Regional Daily, Maybank KE (2015-03-03)

Daily 03 March 2015 TOP VIEWS Samsung Electronics - Prefs. shares (005935 KS) | Company Update Malaysia Strategy | NEUTRAL China Auto OEM | NEUTRAL Minor International (MINT TB) | Company Update Samsung Electronics - Prefs. shares (005935 KS) Some high points on Galaxy S6 Share Price: KRW1,065,000 | Target Price: KRW1,540,000 (+45%) | MCap (USD): 22.2B | ADTV (USD): 29M The new Galaxy S6 handset combines some unique selling points both in software and hardware. Mobile payment and enterprise software are keys. Chips and edge display lead the field. Click here for report » Malaysia Strategy Strategy 4Q report card: Ending on a soft note 2014 core net profit growth in negative territory: -2.0% for the KLCI, -1.3% for our research universe. KLCI core earnings growth forecasts little changed at 6.6%/ 9.0% for 2015/2016; growth risks remain on the downside. No change to our KLCI target; aviation sector downgraded; we continue to advocate a defensive strategy into 2Q15. Click here for report » China Auto OEM Sector Update FY14 results preview Great Wall, Brilliance and SAIC are likely to meet market expectations while we see downside risks to GAC and Dongfeng�s FY14 results amid high inventory pressure. We�re now more positive on Geely due to its new model launches this year and CMA platform for 2016. We remain cautious on BAIC despite its recent positive profit alert. Market has low expectations for auto dealers� results. We�re looking forward to hearing about component makers� margin outlook in result announcements amid falling input cost. Click here for report » Minor International (MINT TB) Show of strength; Top Pick Share Price: THB34.75 | Target Price: THB42.00 (+21%) | MCap (USD): 4.3B | ADTV (USD): 11M Limited impact from dip in Russian tourists as Chinese tourists helped offset the fall. Russian tourists make up 4% of its hotel revenue while Chinese make up 13%. Expect robust EPS growth this year from hotel business recovery & contribution from Tivoli hotels (3% of NPAT). Food biz recovery should be slow in 1H15, we�re betting on 2H15. Maintain BUY. Raise TP to THB42 from THB40, implying 30x PER, 5.3x P/BV and 1.1x PEG for FY15F. MINT continues to have bright prospects and solid growth profile. Click here for report » COMPANY NOTES ITC Ltd (ITC IN) | TP Revision Aneka Tambang (ANTM IJ) | TP Revision Semen Indonesia (SMGR IJ) | Results Review Eversendai Corp (EVSD MK) | Company Update Malaysia Banking | NEUTRAL Metropolitan Bank & Trust Co. (MBT PM) | Results Review Mermaid Maritime (MMT SP) | Results Review Midas Holdings (MIDAS SP) | Company Update Italian-Thai Development (ITD TB) | Results Review Malee Sampran (MALEE TB) | Results Review Vietnam Monthly View ITC Ltd (ITC IN) Budget woes already factored Share Price: INR343 | Target Price: INR420 (+22%) | MCap (USD): 44.3B | ADTV (USD): 53M Maintain BUY despite reduced TP of INR423 (-7%), in view of its domination and strong pricing power in cigarettes. As a result of the FY16 budget proposals, budget, ITC's cigarette sales is imposed with a 16% increase in excise ( our assumption of +10% p a) tax. We believe that ITC will increase cigarette prices by 17% in FY16 to pass on the tax increase and grow its EBIT by 13%. We have fine-tuned our EPS forecast for FY15, in view of moderation in cigarette volumes. Further we reduce our EPS forecast for FY16 by 6.5% and FY17 by 6.9% post factoring a volume drop of 6.6% in FY16. We believe that in the short term, negative catalysts like volume drop in 4QFY15 and the probable implementation of ban on sale of loose cigarettes could impact valuations. (FULL REPORT WILL BE OUT SOON) Aneka Tambang (ANTM IJ) Earnings & TP adjustments Share Price: IDR1,005 | Target Price: IDR1,300 (+29%) | MCap (USD): 742M | ADTV (USD): 1M Retain BUY, but cut SOTP-based TP to IDR1,300 from IDR1,450 on lower FY15F earnings. Attractive valuations at current price. Revising down FY15F EBIT due to lower nickel price assumptions with the bottom line remaining negative. Rights issue positive for capital structure and project expansions. Click here for report » Semen Indonesia (SMGR IJ) Margin pressure remains; HOLD Share Price: IDR14,900 | Target Price: IDR14,100 (-5%) | MCap (USD): 6.8B | ADTV (USD): 10M Maintain HOLD, TP IDR14,100 due to competition and high valuations. Higher 4Q14 profit on volumes, but margins remained under pressure. FY14 core earnings in line with our estimate. FY15F earnings at risk should margin pressure continue. Click here for report » Eversendai Corp (EVSD MK) Sizeable MYR269m win in Qatar Share Price: MYR0.715 | Target Price: MYR0.80 (+12%) | MCap (USD): 139M | ADTV (USD): 0.2M Sizable MYR269m arches and visitors centre job in Doha, Qatar to lift outstanding orderbook to MYR1.9b. New wins YTD has been rapid, job pipeline is looking bright; this could drive earnings rebound in FY15-16. Maintain BUY and TP of MYR0.80 (12x FY15 PER). Click here for report » Malaysia Banking Sector Update Starting off on a softer note Loan growth slipped to 8.6% YoY in Jan 2015 � HH loan application trend marginally positive. Industry LDR hit new high of 87.3%; keeping a wary eye on non-residential property financing asset quality. NEUTRAL on the sector; BUY AFG, HL Bank, HLFG and RHB. Click here for report » Metropolitan Bank & Trust Co. (MBT PM) Asset sale drives earnings higher Share Price: PHP93.60 | Target Price: PHP105.00 (+12%) | MCap (USD): 5.8B | ADTV (USD): 8M FY14 net income was PHP20.1b on strong core lending and non-core asset sale. Keep our positive view on MBT�s performance this year. Rights offer may increase CET1 by 3ppts to 13%. Click here for report » Mermaid Maritime (MMT SP) Tripping over; D/G to HOLD Share Price: SGD0.25 | Target Price: SGD0.24 (-6%) | MCap (USD): 260M | ADTV (USD): 0.2M 5Q14 missed on weak vessel utilisation. DPS of 0.40 USD ct. Tripped by chartered-in vessels. Cut FY15E/16E by 63%/26% for lower utilisation. Downgrade to HOLD from BUY pending better contract visibility. TP cut from SGD0.38 to SGD0.24, now on 0.5x FY15E P/BV, from 9x FY15E PER. Click here for report » Midas Holdings (MIDAS SP) Cheaper play on PRC rail sector Share Price: SGD0.31 | Target Price: SGD0.50 (+61%) | MCap (USD): 278M | ADTV (USD): 2M Management still positive on China�s rail industry, in conference call. Proposed CNR/CSR merger should be net positive for Midas, potentially providing order catalysts. Maintain BUY for cheaper exposure to PRC�s rail sector. TP still at SGD0.50, 1x FY15E P/BV. Click here for report » Italian-Thai Development (ITD TB) Outlook remains bright Share Price: THB9.25 | Target Price: THB10.60 (+15%) | MCap (USD): 1.5B | ADTV (USD): 34M Maintain BUY and raise TP to THB10.6 (from THB7.7). It is a beneficiary of infrastructure investment and ongoing positive news flow will continue to support share price. 4Q14 net profit was THB25m, down 91% QoQ and 94% YoY. In FY14, ITD achieved net profit of THB522m, down 42% YoY. Backlog remains solid at THB210b. This equals to 4.7 years of FY14 revenue. Click here for report » Malee Sampran (MALEE TB) FY14 slightly better; Positive signs Share Price: THB32.50 | Target Price: THB36.00 (+11%) | MCap (USD): 141M | ADTV (USD): 0.3M Still a BUY: FY14 net profit 9% above our estimate, thanks to a very good 4Q. Despite weak headline consumption data, outlook for the fruit juice market has turned positive. Also, the positioning for the market expansion in the context of the upcoming ASEAN Economic integration by YE15, particularly the Greater Mekong Subregion (GMS), is another positive that could drive sales growth higher. We are keeping our forecasts for now as well as target price. We will revisit our assumptions post the analyst meeting. Click here for report » Vietnam Monthly View Strategy Headed higher, with more volatility likely The VN-Index added 0.9% in the last few trading days of Feb�15 after the market re-opened following a long holiday. Amid still-low liquidity, the index was driven up by blue-chips, including banks (VCB, CTG, BID) and VNM, MSN and VIC etc. Net buying by foreign investors reached USD53m in the month, the most since mid-2014. Click here for report » ECONOMICS Thailand Economics Second negative headline inflation But not a main concern of BoT Headline inflation showed a second negative reading in February, declining for the ninth consecutive month, and is now at the slowest pace since Oct 2009. We maintain there could be upside risks from the demand side while we note a rebound in local retail gasoline prices. We believe the central bank is putting less weight on the temporary benign supply-side inflation (or deflation) as it is mainly impacted by falling oil prices and is focusing more on demand momentum. Click here for report »