Macro Research
Asia Strategy: Weekly fund flows in Asia (Yip Yee Lan) Page 7
Asian Instant Insight
– China: PMI Manufacturing – July 2009 (Isaac Meng) Page 8
– Hong Kong: Retail Sales – June 2009 (Angus To) Page 9
– Indonesia: Trade – June 2009; and CPI – July 2009 (Yip Yee Lan) Page 10
– Korea: CPI – July 2009 (Angus To) Page 11
– Thailand: CPI – July 2009 (Yip Yee Lan) Page 12
Today’s Other Research
Cairn India: Production on track, pricing confirmed (Amit Shah) Page 13
CAIR IN; HOLD; CP: INR232.30; TP: INR230.00
􀂃 Crude pricing set at 10-15% discount to Brent. Weather might delay pipeline construction.
􀂃 2010E: P/E 51.8x, P/B 1.4x
China Cement: Policy too late to stop capacity flood (Bruce Wang) Page 14
􀂃 All IPPs to post strong interim results, due to double application of tariff hikes and significant
coal-cost savings.
􀂃 We estimate IPPs to accelerate growth in 2H09, thanks to power demand recovery and stable
coal price.
􀂃 We reiterate our BUY recommendations on Datang, Huadian, Huaneng, and CR Power.
China Resources Land: Fifth injection to enhance NAV mildly (Andy So) Page 15
1109 HK; BUY; CP: HKD19.32; TP: HKD22.20
􀂃 Low discount, injection is another normal acquisition. Earnings upgrade on increase completion.
􀂃 2009E: P/E 31.2x, P/B 2.4x, Yield 0.8%
China Shipping Compass: Supply/demand suggests limited upside (Sarah Liu) Page 16
􀂃 BDI was flat last week. The increasing new supply, unwinding port congestion, slowing China
import, and high iron-ore inventory at Chinese ports all indicate a gloomy outlook for dry bulk
shipping.
􀂃 Container shipping rates and load factors held up well in July. Still idled capacity could return
if the shipping rate trades above the breakeven level.
􀂃 Tanker rates are running below breakeven level, and are expected to fluctuate at a low level
due to oversupply.
China Utilities: Super Powers – Brilliant results ahead (Daisy Zhang) Page 17
􀂃 All IPPs to post strong interim results, due to double application of tariff hikes and significant
coal-cost savings.
􀂃 We estimate IPPs to accelerate growth in 2H09, thanks to power demand recovery and stable
coal price.
􀂃 We reiterate our BUY recommendations on Datang, Huadian, Huaneng, and CR Power.
Chinatrust FHC: 2Q09 earnings likely to disappoint (James Wu) Page 18
2891 TT; HOLD; CP: TWD20.45; TP: TWD18.40
􀂃 NIM to further contract to 1.35% (down 21bp q-q), and US sub NPL to hit 16.9% (up 5.9% q-q).
􀂃 2009E: P/E 20.1x, P/B 1.5x, Yield 1.0%
Ciputra Development: Housing boom (Kim Kwie Sjamsudin) Page 19
CTRA IJ; BUY; CP: IDR810; TP: IDR925
􀂃 TP raised on improving outlook. Main beneficiary of mortgage resurgence.
􀂃 2009E: P/E 27.2x, P/B 1.2x, Yield 0.9%
CLP Holdings: Low SoC returns drag down 1H09 (Daisy Zhang) Page 20
2 HK; BUY; CP: HKD52.65; TP: HKD62.59
􀂃 HK business offers stable growth, while international business is the real growth engine.
􀂃 2009E: P/E 16.0x, P/B 1.9x, Yield 4.7%
Cosco Corp: Dry bulk debacle continues (Glenford Tan) Page 21
COS SP; REDUCE; CP: SGD1.32; TP: SGD0.23
􀂃 Gross margins compressed the most in recent history. Saved by a write-back of receivables.
􀂃 2009E: P/E 37.2x, P/B 2.6x, Yield 5.3%
Daelim Industrial: NDR discussions in the EU (Jae Rhee) Page 22
000210 KS; BUY; CP: KRW71,900; TP: KRW86,000
􀂃 Upside to its current 2009 full-year guidance in orders & OP due to improving market conditions.
􀂃 2009E: P/E 9.1x, P/B 0.8x, Yield 1.4%
HTC Corp: All about marketing or the lack of it (Alen Lin) Page 23
2498 TT; REDUCE; CP: TWD372.50; TP: TWD290.00
􀂃 Rising marketing expenses; limited near-term benefits. Growing pain in working with operators.
􀂃 2009E: P/E 12.9x, P/B 5.4x, Yield 5.4%
Indocement: Brighter outlook (Kim Kwie Sjamsudin) Page 24
INTP IJ; BUY; CP: IDR9,700; TP: IDR10,750
􀂃 Substantial earnings upgrades on strong 1H09 results. Price-driven growth. TP raised.
􀂃 2009E: P/E 18.0x, P/B 3.6x, Yield 1.8%
Malaysia Monthly: July – Najib factor is effective execution (Michael Greenall) Page 25
􀂃 KLCI rose 9.3% m-m to 1,174.9, a new 12-month high but continued to lag regional bourses.
Banks, oil & gas and property sectors outperformed.
􀂃 Najib ended his first 100 days with flying colours and we expect more projects to be awarded
in the next three months, boosting the construction sector.
􀂃 Market is trading on 2009 P/E of 17.4x and 2010 of 15.4x. Our EPS growth forecasts are -
11.5% for 2009 and 13.3% for 2010.
OCBC: 2Q09 results – Lifted by low SP (Ng Wee Siang) Page 26
OCBC SP; HOLD; CP: SGD7.80; TP: SGD7.40
􀂃 Largely bumped up by lower credit charge. Not-so-encouraging key operating trends.
􀂃 2009E: P/E 17.2x, P/B 1.5x, Yield 2.8%
Siam Senses: Banks lend a major hand (Pimpaka Nichgaroon) Page 27
􀂃 Thai banks are now in the process of helping to jump-start the recovery.
􀂃 Competition for loans is intensifying and economic growth momentum will be better in 3Q09
than in 2Q09.
􀂃 Siam Senses defends its bullish stance on Thai banks despite the margin risk in 3Q09.
Singapore Property: Jumping on the bandwagon (Pang Chin Hong) Page 28
􀂃 Our showflat visits reveal that sentiment has remained strong on mass-market projects, but
buyers are price sensitive.
􀂃 There are an increasing number of advertisements to flip options, i.e. The Wharf Residence
and One Devonshire.
􀂃 The mass-market segment remains resilient – BUY on City Developments; REDUCE on
CapitaLand.
Suzlon Energy: Misses estimates; cost control crucial (Lakshminarayana Ganti) Page 29
INTP IJ; BUY; CP: INR95.65; TP: INR93.00
􀂃 We expect 1.4% decline in top-line and 9.5% EBITDA margin in FY10 after REpower
consolidation.
􀂃 2010E: P/E 21.2x, P/B 1.5x, Yield 0.0