Regional Daily, Maybank KE (2014-08-08)

Daily 08 August 2014 TOP VIEWS Beijing Tong Ren Tang (8138 HK) | Results review Perdana Petroleum (PETR MK) | Company update Wilmar International (WIL SP) | Results review KNM Group (KNMG MK) | Company update Beijing Tong Ren Tang (8138 HK) 1H14 solid & in line Share Price: HKD9.30 | Target Price: HKD10.80 (+16%) | MCap (USD): 996M | ADTV (USD): 0.8M We keep our current TP, forecasts and recommendation and wait for latest business updates from management. We will host 2 days of post-results NDR with company on 8th/11th Aug. 1H14 sales/NPAT up 30%/50% YoY, accounting for 43%/47% of our FY14 estimates. Retail sales up 21% YoY but no detailed retail/wholesale sales breakdown. BJTRT has sped up its overseas markets expansion in terms of product registration and acquisitions. It also plans to sell TRT branded healthcare food products in the future. Click here for report » Perdana Petroleum (PETR MK) Feedback from NDR Share Price: MYR1.86 | Target Price: MYR2.55 (+42%) | MCap (USD): 0.4B | ADTV (USD): 1.4M Perdana is our top pick for the OSV play, as it offers a compelling growth story, GO angle and an Ezion alternative. Taking delivery and chartering out the 4 new accommodation workbarges (AWBs) in 2016 would catalyse earnings. Maintain BUY and MYR2.55 TP, based on 15x FY15 PER. Our forecasts exclude 2 optional 500pax AWBs arriving in 2H16. Click here for report » Wilmar International (WIL SP) Better crushing & sugar next year Share Price: SGD3.24 | Target Price: SGD4.08 (+26%) | MCap (USD): 16.6B | ADTV (USD): 15M 2Q14 results still weak and fell short of market expectations. Cut FY14E-16E EPS by 8-9% for lower Palm & Laurics margins. Reiterate BUY with new Street-high TP of SGD4.08 (from SGD3.94; 15x FY15E P/E) after rollover. Better soybean crushing and sugar conditions next year. Click here for report » KNM Group (KNMG MK) RAPID ready Share Price: MYR1.04 | Target Price: MYR1.50 (+44%) | MCap (USD): 0.5B | ADTV (USD): 4M Estimated to secure USD280m worth of works from Sinopec�s USD1.3b package win. Raising 2015/16 earnings by 44%/40% to account for higher jobs wins (+MYR1b to MYR3b p.a.). Changed valuation methodology to backlog-based; TP raised to MYR1.50 (+50%) on 0.7x EV/backlog. BUY. Click here for report » COMPANY NOTES Noble Group (NOBL SP) | Rating Change Chong Hing Bank (1111 HK) | TP Revision Indonesia Mining | NEUTRAL Sentul City (BKSL IJ) | Results Review D&L Industries Inc (DNL PM) | Results Review Neptune Orient Lines (NOL SP) | Results Review CWT (CWT SP) | Results Review Central Pattana (CPN TB) | Results Preview Thanachart Capital (TCAP TB) | Rating Change Noble Group (NOBL SP) Fairly valued; cut to HOLD Share Price: SGD1.37 | Target Price: SGD1.47(+8%) | MCap (USD): 7.3B | ADTV (USD): 22M 2Q14 results missed due to margin corrections. Limited chance of positive earnings surprises in 2H14. Downgrade to HOLD from BUY with higher TP of SGD1.47 (SGD1.37 previously; GGM) after rollover. Switch to Wilmar for sector exposure. Click here for report » Chong Hing Bank (1111 HK) No imminent synergies with Yuexiu Share Price: HKD14.58 | Target Price: HKD15.90(+9%) | MCap (USD): 818M | ADTV (USD): 0.7M Maintain HOLD and raise TP to HKD15.90 from HKD14.85. CHB made efforts to widen NIM; kept sound asset quality. Yuexiu has no imminent plan to create synergies with CHB. Click here for report » Indonesia Mining Revised export tax regulation Sector update The revised regulation allows miners committed to building smelters to enjoy lower export tax rate. AKRA an indirect beneficiary of the tax change as it enables Freeport to start exporting mineral concentrates. No change in the government�s policy on ore export ban. Click here for report » Sentul City (BKSL IJ) Great asset, volatile earnings Share Price: IDR122 | Target Price: IDR140(+15%) | MCap (USD): 327M | ADTV (USD): 3M Sharp QoQ recovery in revenues and earnings in 2Q14, but not enough to achieve full-year target. We cut earnings forecast by 64% in FY14 and FY15 as execution risk remains high. Earnings volatility will remain high in the near term. It is a trade-off between volatile earnings and large land bank at deep discounted RNAV. Maintain HOLD. Click here for report » D&L Industries Inc (DNL PM) Lower margins due to product mix Share Price: PHP10.88 | Target Price: PHP11.50(+6%) | MCap (USD): 889M | ADTV (USD): 1M Net income up 24% in 2Q14 and 22% in 1H14, on track to meet our full-year earnings forecast of PHP1.72b. Overall GPM down in 1H14 but steady for high-margin specialty products as a group. Downgrade to HOLD as potential upside limited after surging 73% YTD. (Full report will be out soon) Neptune Orient Lines (NOL SP) Cash generation improves Share Price: SGD0.96 | Target Price: SGD1.05(+10%) | MCap (USD): 2.0B | ADTV (USD): 1M 2Q14 net loss of USD54m in line. Cash generation improved significantly as core EBITDA doubled to USD78m. Valuations not compelling given net gearing of 2.16x and FY15E ROE of 7%. TP raised to SGD1.05 (from SGD1) after rollover to 1.0x FY15E P/BV. Maintain HOLD. (Full report will be out soon) CWT (CWT SP) In a sweet spot Share Price: SGD1.67 | Target Price: SGD1.90(+14%) | MCap (USD): 799M | ADTV (USD): 2M 2Q14 in line. Revenue up 114% YoY and net profit, 67%. Growth fuelled by Logistics and Financial Services. We expect stronger 2H. Maintain BUY and TP of SGD1.90 (SOTP). Catalysts are positive earnings surprises. Click here for report » Central Pattana (CPN TB) Unreasonable pull back Share Price: THB46.25 | Target Price: THB60.00(+30%) | MCap (USD): 6.4B | ADTV (USD): 7M Reiterate BUY with Street-high TP of THB60 based on DCF (8.8% WACC and 5% terminal growth). Current share price weakness a buying opportunity given positive outlook intact. Expect 2Q14 net profit to be THB1,747m (EPS THB0.39), up 2% QoQ and 22% YoY. Strong YoY growth driven by rental increase and new malls expansion during 1H14. Gain from sale of Central Chiangmai Airport will be booked in 3Q14 instead of 2Q14; to record as one-time gain (THB5b net of tax) or amortize over 30yrs (THB45m/qtr net of tax) still under discussions. We�ve not factored this into our forecast. Click here for report » Thanachart Capital (TCAP TB) Improved prospects in 2H14 Share Price: THB34.50 | Target Price: THB35.00(+1%) | MCap (USD): 1.4B | ADTV (USD): 4M Upgrade to HOLD and raise TP to THB35 (from THB29), implying 8x 2014PE, 0.9x P/BV and 11.8% ROE. Still prefer SCB, KBANK and KTB. We apply a higher P/BV of 0.9x (prev. 0.7x) given a better 2H14 outlook on asset quality and capital market business. The bank expects loans to grow 1-3% (prev. 6-7%) this year, in line with our assumption of 3% given weak auto demand. Click here for report »