报告名称：CSCI Alert(03311.HK)Access China conference 2016 highlights
报告类型：港股研究
报告日期：2016-01-12
研究机构：德意志银行
股票名称：中国建筑国际
股票代码：03311
页数：1
简介：CSCI attended our Access China 2016 conference and the following are the key highlights.
CSCI is optimistic on the outlook for the HK infrastructure construction market, on the back of many major upcoming projects such as the third runway of the Hong Kong International Airport and also seven new railway lines. Despite these, management is concerned about the potential risk for political instability in HK, just like what happened in 2014. As a reference, the change in new contract values for 2014 dropped 49% YoY.
CSCI also thinks there are ample opportunities for the Macau market. The Macau government has shown its intention to improve its lagging performance in infrastructure construction. In addition, the government has sufficient fiscal reserves to fund infrastructure construction.
Previously, the bottleneck for infrastructure development in the city has been the shortage of land. But this will be resolved as the central government has granted Macau the right to manage a total of sea area of 85 sq km surrounding the city. It means that the land area of Macau could increase significantly from 35 sq km by land reclamation.
Currently, CSCI’s market share in Macau’s construction market is about 30%. Management is highly confident about tapping into the growing infrastructure construction market in the city. Commenting on concerns over the capacity of CSCI to meet booming demand, management said that after the existing casino project, scheduled to be completed in 2017, the company could free-up most of its capacity for the infrastructure market. In addition, CSCI has the flexibility to adjust capacity between HK and Macau to cater for increasing new contracts.
For the China market, CSCI thinks the public-private-partnership projects will be the major growth driver going forward.
Under the PPP model, cash collection of projects will improve as debts will be borne by the local government; the legitimacy of the model should improve when compared to traditional modes of cooperation. Moreover, fewer capital requirements are needed by CSCI given JV partners for funding of the project; hence, the company would better utilize its capital.
CSCI said its profile perfectly fits the potential requirement to be a partner on PPP projects, as local governments prefer to cooperate with companies with similar backgrounds while fulfilling the requirement to bring in foreign direct investment (FDI).
Commenting on its debt structure, as of 1H15, about 60% / 40% of the company’s debts were denominated in USD or HKD / RMB. The revenue contribution split between HKD or USD / RMB is about the same as that in the debt structure. Hence, the company thinks the impact from RMB depreciation is insignificant. Moreover, starting from 2014, the company has started to finance their projects in China with onshore debt; hence, the future impact from RMB depreciation is also limited so CSCI has not done any hedging.

下载地址：CSCI Alert(03311.HK)Access China conference 2016 highlights