Regional Daily, Maybank KE (2014-09-12)

Daily 12 September 2014 TOP VIEWS Philippines Economics Hoa Phat Group (HPG VN) | Transfer Coverage China Financial Services Holdings (605 HK) | Company Update SP Setia, Sime Darby | Company Visit Philippines Economics Economics Stronger action for supply issues Monetary board hiked policy and SDA rates 25bps. More scope for further rate hikes if inflation doesn�t slow. Growth prospects still robust if tightening measured. Click here for report » Hoa Phat Group (HPG VN) Go long on long steel; BUY Share Price: VND57,500 | Target Price: VND76,000 (+32%) | MCap (USD): 1.4B | ADTV (USD): 2.4M Maintain BUY with TP of VND76,000. Investable market-leading steelmaker specialising in long steel and steel pipes, both with an 18% market share. �Moated� business with secured access to iron ore, an established distribution network and favourable protectionist tariffs. Well-run management helps maintain high profitability. Excellent structural exposure to Vietnam�s long-term urban development. Click here for report » China Financial Services Holdings (605 HK) Remain positive after latest NDR Share Price: HKD0.57 | Target Price: HKD0.95 (+67%)| MCap (USD): 252M | ADTV (USD): 0.4M Limited change in EPS forecast. Keep BUY and TP at HKD0.95 Net profit contribution from new JVs will be 23% in 2016 Shift towards low yield loans and low cost funding Click here for report » SP Setia, Sime Darby Battersea: Re-writing history SIME MK; BUY |SPSB MK; HOLD BPS's demand, selling price and deliveries have exceeded our expectations. Total GDV could well be GBP10b now. Phase 1 handover targeted in June 2016 with Sime and SP Setia estimated to recognise lumpy profits of MYR263m each. Maintain BUY on Sime with unchanged TP of MYR10.20 while SP Setia is a HOLD at a higher MYR3.47 TP (+11sen). Click here for report » COMPANY NOTES Bangkok Dusit Medical Services (BGH TB) | Company Update SP Setia (SPSB MK) | Results Preview Hyflux Ltd (HYF SP) | Initation Bangkok Dusit Medical Services (BGH TB) Nothing to worry Share Price: THB18.30 | Target Price: THB23.00 (+26%) | MCap (USD): 8.8B | ADTV (USD): 21M BGH issued THB10b zero-coupon convertible bonds due in 2019. Proceeds will be used for investment and expansion. Conversion price is 15% above last price. Yield to maturity for the CB is 2%. No significant cash flow and P&L impact until maturity. Dilution upon full conversion is 3% based on THB10b issued. Maintain BUY w/ DCF-based TP of THB23, implying 37x PER, 6x P/BV and 1.3x PEG for FY15F. Medium to LT growth outlook remain positive. Catalysts from M&A in 4Q14-1H15. (FULL REPORT WILL BE OUT SOON) SP Setia (SPSB MK) 2016, the tipping point Share Price: MYR3.48 | Target Price: MYR3.36 (-+3%) | MCap (USD): 2.7B | ADTV (USD): 2.0M Massive jump in FY16 earnings as contribution from Battersea Power Station comes in earlier than expected. Cut FY14/15 earnings forecasts by -27%/-6% but raise FY16 by +42%. Our TP is raised to MYR3.47 (on 0.7x P/RNAV); maintain HOLD. Potential asset injection by PNB is a catalyst. Click here for report » Hyflux Ltd (HYF SP) Waiting for catalysts Share Price: SGD1.14 | Target Price: SGD1.07 (-6%) | MCap (USD): 777M | ADTV (USD): 0.6M Initiate with HOLD. TP at SGD1.07, 25x FY16E P/E, comparable to closest peer, United Envirotech. For sector exposure, we recommend HanKore and SIIC. Long-term bullish on Hyflux�s membrane-based desalination. Medium-term earnings weakness. Catalysts are renewed order-win momentum and big-scale asset recycling. Click here for report » ECONOMICS Malaysia Economics | Industrial Production Malaysia Economics | Manufacturing Sales Industrial Production, July 14 Malaysia Economics Slow start to 2H 2014� Industrial production growth in Jul 2014 fell off a cliff to +0.5% YoY (Jun 2014: +7.0% YoY) in part due to the high base from last year. IPI data was in line with trade data signaling tapering of GDP growth after robust 1H 2014. No change to our 2014 IP forecast for now. Global IP trends remain stable in June 2014 as near-term outlook remains positive. Click here for report » Manufacturing Sales, July 14 Malaysia Economics Momentum continue to slow Manufacturing sales growth continued to slide in July 2014 mirroring recently released weaker export trends. High base, festive season and stronger MYR may have had negative effect on manufacturing sales growth as sales growth only halved the growth in production index. Productivity or average sales per employee rose by +2.8% MoM or +0.1% YoY (YTD 2014: 6.3%). Click here for report »