1. business and industrial

Morning Express
21 November 2014
Focus of the Day
Indices
Harbin Bank (6138.HK)
Neutral
A leading microcredit bank with international and
strategic vision
Qingli YANG
Last Closing: HK$2.86
[email protected]
Upside: +6.6%
LT
BUY
BUY
SELL
Stock
Target Price: HK$3.05
Harbin Bank has been forward looking in strategic vision, as one of the first commercial
banks to establish microcredit and rural financial business strategies in China. The bank
has a diversified shareholding structure. Its stable shareholding structure, experienced
and stable management and unique market-driven business model enable the bank to
formulate and implement consistent strategies.
Close
HSI
23,350
H Shares
10,379
SH A
2,568
SH B
264
SZ A
1,405
SZ B
962
DJIA
17,719
S&P 500
2,053
Nasdaq
4,702
FTSE
6,679
CAC
4,234
DAX
9,484
Source: Bloomberg
1d %
-0.10
-0.01
0.07
0.17
-0.21
-0.26
0.19
0.20
0.56
-0.26
-0.75
0.12
Ytd %
0.19
-4.04
15.97
4.11
27.27
10.79
6.89
11.06
12.58
-1.04
-1.44
-0.71
Close
79.33
1,193.18
16.25
6,685.00
118.25
1.57
1.25
3m %
-22.44
-6.55
-16.43
-2.66
-12.18
-5.35
-5.54
Ytd %
-28.40
-1.03
-16.53
-9.17
-10.94
-5.22
-8.72
bps change
HIBOR
0.37
US 10 yield
2.34
Source: Bloomberg
3m
0.01
-0.07
6m
0.01
-0.19
Indicators
The bank is a pioneer in microcredit loans in China, with greater exposure to microcredit
loans than its listed peers. Microcredit loans feature high pricing levels and sound asset
quality. It also has distinct competitive edges in geographical coverage, rural finance and
Russian businesses. Its retail banking business also commands an advantage with notable
growth potential.
Asset quality improved notably from 2007 to 2012. In 2013, the amount of overdue loans
increased rapidly. The high interest spread between loans and deposits, low
loan-to-deposit ratio and low leverage ratio provide upside in profitability.
Brent
Gold
Silver
Copper
JPY
GBP
EURO
We initiate coverage at Neutral with a TP of HK$3.05.
HSI Technical
ChinaSoft Int'l (354.HK)
NDR takeaways-revenue growth to be maintained and upside potential
in gross margin
Yuan MA
[email protected]
Last Closing: HK$2.69
Not Rated
We invited ChinaSoft Int’l (354.HK)’s COO Mr. Fu Kun and General Manager of Corporate
Development Ms Lin Shanshan for an NDR in Hong Kong upon 3Q14 to share the latest
developments of the company. Huawei estimated that by 2017, the market scale of its
outsourced business will reach RMB10.5 bn, growth of more than 300% as compared
with 2014. The company, being one of the most trusted suppliers of Huawei, will also be
given greater room for growth in the business. JF platform will be opened for testing on
12 Dec and i its business model will encompass profitability enhancement to revenue
Download our reports from Bloomberg: BOCM〈enter〉
HSI
50 d MA
200 d MA
14 d RSI
Short Sell (HK$m)
Source: Bloomberg
23,350
23,645
23,242
42
6,523
Morning Express
21 November 2014
source expansion, such as extending its customer base to small and micro enterprises,
mission undertaking and commissioning, as well as ad revenue and online payment of
interest revenue from collected funds. In respect of the cloud business, other than its
existing business, Aliyun has entered into framework agreements with the E-government
clouds of seven provinces. These agreements will be implemented next year. The
company is confident in maintaining its 2014 growth rate next year. It will also enhance
its gross profit margin through JF platform. The management anticipates the gross profit
margin to inch up by 1 to 2 ppts.
Hang Seng Index (1 year)
Internet Sector
HS China Enterprise Index (1 year)
24,000
23,000
22,000
21,000
Source: Company data, Bloomberg
12,000
11,000
Integration of contents and hardware-Xiaomi to invest in iQiyi
[email protected]
10,000
9,000
UP
MP
OP
Xiaomi took important steps in content development. After Chen Dan from Sina joined
the company, the company spent US$1 bn in content development and invested in Youku
and Tudou. We believe that Xiaomi will have more investment and tie-ups in terms of
content development such as video production. iQiyi’s investment logic is to integrate
contents with hardware. Xiaomi is undeniably the ideal partner then. Future
opportunities of mergers and acquisitions have become rare as the internet video
industry has been basically developed. In the long run, industry integration will help forge
alliance, alleviate the problems of high content cost and bandwidth cost and bring relief
to the pressure on industry profit margin. In the mid to short term, upon Xiaomi’s share
subscription, iQiyi will mainly use the proceeds to invest in its own content and
purchased content. The contents of iQiyi will be integrated with Xiaomi’s channels. Going
forward, if the mobile users of Xiaomi can align well with the traffic and contents of
iQiyi, it will bring the most ideal return on investment, in our view.
China Macro
Comments on November HSBC flash China PMI
Miaoxian LI
25,000
13,000
MIT-Martina Internet Talk:
Yuan MA
26,000
[email protected]
Economics
1) The flash reading of HSBC’s November China PMI came in at 50, lower than 50.4 in
October. The decline could be due to the temporary negative impact from China’s
measures to create the so-called “APEC blue” during the APEC summit. Therefore,
the November PMI might have exaggerated the downward pressure on the
economy.
2) Decline of Output dragged headline PMI. The Output index fell 1.2 ppts MoM,
dragging the headline figure by 0.3 ppt. However, the New Orders index rebounded
0.2 ppt MoM, which was driven by domestic orders, possibly spurred by the recovery
of the property market and accelerated infrastructure investment. Therefore, we
believe the decline of Output reflected, rather than a deterioration of demand,
short-term factors such as production halts during APEC.
Download our reports from Bloomberg: BOCM〈enter〉
8,000
Source: Company data, Bloomberg
Shanghai A-shares (1 year)
2,600
2,400
2,200
2,000
1,800
Source: Company data, Bloomberg
Shenzhen A-shares (1 year)
1,500
1,400
1,300
1,200
1,100
1,000
900
800
Source: Company data, Bloomberg
Morning Express
21 November 2014
3) Market’s speculation of RRR cut is based on unsound reasoning. Some market
participants believe that the statement of “higher flexibility in LDR” from the
Executive Meeting of the State Council implied an extension of the definition of
general deposits and a reduction of RRR. However, the official press release did not
mention any extension of definition – it was market speculation. There are many
ways to introduce higher flexibility to LDR, such as simply raising the LDR ceiling,
which would not involve an RRR cut.
Transportation Sector
Weekly transportation news wrap
Ian FENG
[email protected]
Weekly
In terms of sector, we highlight some notable updates for the transportation industry this
week as follows:
Global dry bulk market: Baltic Dry Bulk Index (BDI) started to rise this week due to the
increase of BCI. BDI may maintain an upward trend in the fourth quarter, as it is the
traditional peak season for the shipping industry.
Import and export: In October, total China iron ore imports recorded a decline of 12.4%
MoM due to a decrease in demand. China coal imports fell for the fourth consecutive
month on a YoY basis.
Railway: China Railway Group (390.HK) won bids for 14 projects, with a total contract
value of RMB24.2 billion.
Logistics: State Council issued Opinions on Promoting the Development of Domestic
Trade Circulation, boding well for the logistics industry.
Download our reports from Bloomberg: BOCM〈enter〉
21 November 2014
Last Closing: HK$2.86
Upside: +6.6%
Target Price: HK$3.05
Banking Sector
Harbin Bank (6138.HK)
UP
MP
OP
A leading microcredit bank with international and strategic vision
Initiation of coverage
Financial Highlights
RMB mn
Revenue
Operating profit
Net profit attributable to equity holders
of the parent
YoY
EPS (RMB)
YoY
PE
PB
DPS
Dividend yield
Source: Company, BOCOM Int’l
2012
7,711
3,849
2,864
2013
8,544
4,447
3,350
2014E
10,544
5,457
4,059
2015E
12,646
6,569
4,917
2016E
14,887
7,934
5,938
54.5%
0.17
4.9%
5.96
1.02
0.02
1.00%
7.0%
0.17
-0.6%
5.56
0.94
0.06
2.70%
21.1%
0.14
-19.3%
6.12
0.84
0.07
3.27%
21.1%
0.15
6.4%
5.05
0.74
0.09
3.96%
20.8%
0.15
5.3%
4.18
0.64
0.11
4.78%
Neutral
LT
BUY
BUY
SELL
Harbin Bank has been forward looking in strategic vision. As of 31 Dec 2013, Harbin
Bank was the second largest commercial bank in Heilongjiang Province and the
largest commercial bank in Harbin. The bank has had long-term strategic vision as it
launched the microcredit business (a strategy in line with the global banking trend of
focusing on smaller customers and retail businesses) in as early as 2001, much earlier
than its domestic counterparts. Meanwhile, the bank, having launched rural financial
services in 2005, is one of the pioneering commercial banks to establish microcredit
and rural financial business strategies in China. Harbin Bank has a diversified
shareholding structure. As of 30 Jun 2014, Harbin Economic Development, the
largest shareholder of the bank, held a 19.65% stake in the bank, while other
shareholders owned less than 7% each. The shareholding structure has been
relatively stable. The experienced and stable management team and the unique,
market-driven business model ensure consistency in its business strategies. The
bank’s core strategy is to become “a first-class domestic and internationally
renowned microcredit bank”.
Pioneer in microcredit loans. Harbin Bank was the first commercial bank in the PRC
to commence the microcredit businesses, comprising small enterprise loans, loans to
farmers and personal consumption loans. It has established the unique microcredit
brand of “Just-for-you”. The business has managed to expand rapidly, thanks to a
sophisticated management model. As of 30 Jun 2014, Harbin Bank’s microcredit
loans (excluding personal consumption loans and loans to farmers) accounted for
46.1% of its total loans, a much higher ratio than its listed peers. Microcredit loans
feature both high pricing levels and sound asset quality. The bank has established a
microcredit R&D centre and financial IT system with proprietary intellectual property
rights. It not only replicates its microcredit loan management model to the branches
in other regions, but also exports microcredit know-how to peers.
Stock
Harbin Bank has been forward looking in strategic
vision, as one of the first commercial banks to
establish microcredit and rural financial business
strategies in China. The bank has a diversified
shareholding structure. Its stable shareholding
structure, experienced and stable management and
unique market-driven business model enable the
bank to formulate and implement consistent
strategies.
The bank is a pioneer in microcredit loans in China,
with greater exposure to microcredit loans than its
listed peers. Microcredit loans feature high pricing
levels and sound asset quality. It also has distinct
competitive edges in geographical coverage, rural
finance and Russian businesses. Its retail banking
business also commands an advantage with notable
growth potential.
Asset quality improved notably from 2007 to 2012. In
2013, the amount of overdue loans increased rapidly.
The high interest spread between loans and deposits,
low loan-to-deposit ratio and low leverage ratio
provide upside in profitability.
We initiate coverage at Neutral with a TP of HK$3.05.
Stock data
3.20
2.66
31
3,024
1
-2.05
N/A
2.91
N/A
44.83
52w High (HK$)
52w Low (HK$)
Market cap (HK$m)
Issued shares (m)
Avg daily vol (m)
1-mth change (%)
YTD change (%)
50d MA (HK$)
200d MA (HK$)
14-day RSI
Source: Bloomberg
1-year performance chart
15%
哈尔滨银行
恒指H股指数
10%
5%
0%
-5%
The bank enjoys outstanding competitive edges in regional coverage, rural financial
services and Russian businesses. Harbin Bank was one of the first city commercial
banks approved to establish and operate a cross-regional operating network outside
their home provinces. Harbin Bank is also one of the city commercial banks with the
broadest regional coverage and the most comprehensive branch network outside
their home provinces. As of 31 Dec 2012, it was one of the city commercial banks
with the largest number of village and township banks in China. As of 30 Jun 2014,
the number of outlets of Harbin Bank outstripped that of its listed peers, which gave
the bank an edge in this respect whilst enabling the bank to establish a more
Download our reports from Bloomberg: BOCM〈enter〉
-10%
Source: Bloomberg
Yang Qingli
[email protected]
Tel: (852) 2977 9212
Wan Li CFA
[email protected]
Tel: (8610) 8800 9788 - 8051
Li Shanshan CFA
[email protected]
Tel: (8610) 8800 9788 - 8058
21 November 2014
Transportation Weekly
Transportation
Transportation Sector
Weekly transportation news wrap
th
The global dry bulk market started rising this week. As of 19 November 2014, the
Baltic Dry Bulk Index (BDI) declined by 1.6% WoW to 1,306. However, it should be
th
noted that BDI has already reversed course since Monday, 17 November after the
th
fall since 10 November, largely due to the pickup of BCI, in our view. Yet, BCI still
reported a decline of 3.2% WoW, to 3,127 this week. BPI reached 1,055, with a
drop of 6.9% WoW and 22% YoY. BSI also reversed its downward trend, reaching
904, an increase of 3.6% WoW. BDI may recover in the fourth quarter, in our view,
as it is the traditional peak season for dry bulk shipping.
China iron ore and coal imports saw a declining trend. In October, total China iron
ore imports were $6,568 million, down by 24.7% YoY and 12.4% on a MoM basis.
China iron ore imports reached 79.4 million tonnes, an increase of 17% YoY, but a
decline of 6.3% MoM, mainly driven by a decrease in demand and price, in our view.
Although iron ore imports fell in October, it is still staying at a relatively high level.
Demand for iron ore remained low, partly due to seasonality, in our view. Likewise,
China coal imports amounted to 20.1 million tonnes, a slump by 17.4% YoY and 4.9%
MoM, marking the fourth consecutive month of decline on a YoY basis. Total coal
imports could trend lower ahead due to NDRC’s requirement of reducing 50 million
tonnes of coal imports this year.
China Railway won bids for a total contract value of RMB24.2 billion. China Railway
Group (390 HK) won bids for a total of 14 projects including railway and highway
projects, with a total contract value of RMB24.2 billion. The subsidiaries of China
Railway, China Railway No.1 Engineering Group, China Railway No.5 Engineering Group,
and China Railway No.3 Engineering Group won the bids for the station-front projects
of the Huaihua-Shaoyang-Hengyang rail line, with a duration of 1,552 calendar days.
According to the results announcement for 3Q14, new contract value of railway
projects amounted to RMB157.8 billion for China Railway Group, up 16.3% YoY,
outperforming other businesses.
State Council issued the Opinions on Promoting the Development of Domestic
th
Trade Distribution, which should benefit the logistics industry. On 16 November
2014, State Council issued the Opinions on Promoting the Development of Domestic
Trade Distribution. One of the key areas of development mentioned in the document
is the development of the modern logistics industry. Some of the proposed
development areas of the modern logistics industry include equipment standardization,
provision of sophisticated 3PL services, e-logistics and express delivery services,
cold-chain logistics and agricultural produce logistics. Development of the logistics
industry optimizes trade circulation by reducing circulation cost, improving the
intermediate process, and increasing consumption, according to the Opinions. The
newly released Opinions should be positive for the development of China’s logistics
industry, in our view.
Download our reports from Bloomberg: BOCM〈enter〉
1-Year Sector Performance
20%
Sector performance
HSI Index performance
15%
10%
5%
0%
-5%
-10%
-15%
Nov-13
Feb-14
May-14
Aug-14
Source: Bloomberg
Ian Feng
[email protected]
Tel: (852) 29779381
Geoffrey Cheng, CFA
[email protected]
Tel: (852)2977 9380
Oct-14
Morning Express
21 November 2014
Market Review
Hong Kong stocks fell for the fourth straight day. The Hang Seng Index finished Thursday
down 23 points, or 0.1%, at 23,459, after the HSBC flash China PMI for November came in
at a six-month low of 50. CR Land (1109.HK) lost 1.6% as the worst blue-chip performer.
Other companies under the CR group also fell. CRE (291.HK) dropped 1.2%. CR Power
(836.HK) fell 1.5%. HKEx (388.HK) extended loss to the fifth consecutive session, as usage
of quota of SH-HK Stock Connect remained low. However, brokers rebounded. CITIC
Securities (6030.HK) rose 2.9% and Haitong (6837.HK) gained 2.4%. CNOOC (883.HK) rose
2% after new discovery in South China Sea. Anton Oil (3337.HK) soared 17%.
US stocks finished higher on Thursday. The S&P 500 rose 4 points, or 0.2%, to 2,052.75.
The DJIA gained 33.27 points, or 0.2%, to 17,719. European stocks closed lower following
disappointing eurozone PMI. The Stoxx Europe 600 dropped 0.3% to 338.28.
News Reaction
The State Council: to support the development of small and micro enterprises and to
implement preferential fiscal, taxation and financial policies. The State Council of the
PRC issued ten opinions relating to policies in support of the sound development of small
and micro enterprises on Thursday, in which it was specified that preferential policies will
be implemented to support fiscal, taxation, employment and finance. On the premise
that regulations will be tightened, great efforts will be made to encourage qualified
private capital to form financial institutions such as medium-to-small banks in accordance
with laws.
China adjusted its classification standards of urban planning to five categories and
seven grades in line with the need of urbanization. The State Council of the PRC issued a
notification relating to the adjustment of the classification standards of urban planning.
According to the new classification standards of urban planning, statistics will be
conducted based on permanent population of the urban area. Cities will be classified into
five categories and seven grades so as to facilitate a better population and city
classification management in line with the new requirements of urbanization.
National Bureau of Statistics of the PRC: completion and commencement of production
of the phase I of the national petroleum reserve project. According to the National
Bureau of Statistics of the PRC, the national petroleum reserve project (phase I) includes
four national petroleum reserve bases at Zhoushan, Zhenhai, Dalian and Huangdou. The
total reserve capacity of the bases is 16.4 million cubic meters and the crude oil reserve is
12.43 million tonnes.
MIIT confirmed, for the first time, that the salt franchise system will be cancelled. As
reported by CCTV, MIIT had, for the first time, confirmed that China will cancel the salt
franchise system to give way to the voluntary operation and fair competitions of salt
companies.
Shanghai set to complete full 4G coverage by the end of next year. As disclosed by Liu
Jian, the deputy head of the Shanghai Municipal Commission of Economy and
Informatisation, 4G coverage will span across Shanghai by the end of 2015. To deepen
the coverage, such as facilitating more in-depth coverage in more densely populated
Download our reports from Bloomberg: BOCM〈enter〉
Morning Express
21 November 2014
regions such as airports, high-speed train stations and regions with higher subway
passenger traffic will be the major task for 2016, with an aim to enhance the quality of
the network. As planned, Shanghai seeks to achieve full 4G coverage by 2016.
Download our reports from Bloomberg: BOCM〈enter〉
Morning Express
21 November 2014
Economic releases for this week - USA
Economic releases for this week - China
Date Time
Event
Survey
Prior
17-Nov
18-Nov
18-Nov
19-Nov
20-Nov
20-Nov
20-Nov
20-Nov
-
Industrial Production(MoM)
PPI(MoM)
PPI ex food & energy (MoM)
Housing Starts(k)
CPI (MoM)
Initial jobless claims (k)
Existing Home sales (m)
Leading indicators
-
-0.1%
0.1%
1,025.0
-0.1%
5.15
0.6%
-
50.4
-0.1%
0.0%
1,017.0
0.1%
290.0
5.17
0.8%
-
Source: Bloomberg
Date Time
20-Nov
Event
HSBC Manufacturing PMI
Survey
-
Prior
50.4
Source: Bloomberg
BOCOM Research Latest Reports
Data
20 Nov 2014
19 Nov 2014
19 Nov 2014
19 Nov 2014
18 Nov 2014
18 Nov 2014
18 Nov 2014
18 Nov 2014
17 Nov 2014
17 Nov 2014
17 Nov 2014
17 Nov 2014
17 Nov 2014
14 Nov 2014
14 Nov 2014
14 Nov 2014
14 Nov 2014
13 Nov 2014
13 Nov 2014
12 Nov 2014
Report
Baidu (BIDU.US) - MIT-Martina Internet Talk: Acquiring Kuaiqian to make up the short board in mobile
payment
China Market Strategy - SH-HK Connect: D.O.A.?
Sa Sa (178.HK) - Downgrade to Neutral on unexciting near term outlook
Energy Sector - Fei Wu, Tony Liu
Container Shipping Sector - Weekly container shipping commentary
Tingyi (322.HK) - Shifting from a volume story to a margin story
Kingsoft (3888.HK) - MIT-Martina Internet Talk: Takeaways from 3Q14 NDR --The Next Breakthrough
Tencent (700.HK) - MIT-Martina Internet Talk: Can Weixin Phone Book become the next super Aapp?
China Market Strategy - SH-HK Connect: Breaking New Grounds
Property Sector - HK/China property weekly - 14th November 2014
China Resources Enterprise (291.HK) - Poorer-than-expected 3Q; profit warning to continue; dividend may
cease
Sina (SINA.US) - Weibo ad to drive revenue in the short term; vertical portal is the long-term objective
Alibaba Group (BABA.US) - "Double 11"--Mobilization and globalization were the highlights; mobile payment
played an important role
Energy Sector - Bocom Energy Weekly
Netease (NTES.US) - 3Q top-line beat on fast-growing eCommerce and ad revenue
Transportation Sector - IWeekly transportation news wrap
Insurance Sector - Recommend buying undervalued insurance stocks on re-rating potential driven by visible
growth
Tencent (700.HK) - 3Q top-line missed; opportunity in performance based ad
SH-HK Stock Connect - Rebalancing the A/H valuation gap and searching for overlooked names
China Property Sector - Constrained valuation amid sales recovery
Source: Company data, BOCOM International
Download our reports from Bloomberg: BOCM〈enter〉
Analyst
Ma Yuan (Martina), Ph.D, Gu Xinyu (Connie), CPA
Hao Hong, CFA
Phoebe Wong
Bocom Energy Weekly
Geoffrey Cheng, CFA
Summer WANG
Ma Yuan (Martina), Ph.D, Gu Xinyu (Connie), CPA
Ma Yuan (Martina), Ph.D, Gu Xinyu (Connie), CPA
Hong Hao, CFA
Luella Guo, Alfred Lau, CFA, FRM, Toni Ho, CFA,
FRM
Phoebe Wong
Ma Yuan (Martina), Ph.D, Gu Xinyu (Connie), CPA
Ma Yuan (Martina), Ph.D, Gu Xinyu (Connie), CPA
Fei Wu, Tony Liu
Ma Yuan (Martina), Ph.D, Gu Xinyu (Connie), CPA
an Feng, Geoffrey Cheng, CFA
Li Wenbing
Ma Yuan (Martina), Ph.D, Gu Xinyu (Connie), CPA
Energy Sector - Fei Wu, Xutong Liu
Toni Ho, CFA, FRM, Alfred Lau, CFA, FRM
Morning Express
21 November 2014
Hang Seng Index Constituents
Company
name
Cheung Kong
Hang Lung Proper
Hengan Intl
China Shenhua-H
Hang Seng Bk
China Res Land
Cosco Pac Ltd
Henderson Land D
Aia Group Ltd
Hutchison Whampo
Kunlun Energy Co
Ind & Comm Bk-H
China Merchant
Want Want China
Sun Hung Kai Pro
New World Dev
Belle Internatio
China Coal Ene-H
Swire Pacific-A
Sands China Ltd
Clp Hldgs Ltd
Bank East Asia
Ping An Insura-H
Boc Hong Kong Ho
China Life Ins-H
Citic Pacific
China Res Enterp
Cathay Pac Air
Hong Kg China Gs
Tingyi Hldg Co
Esprit Hldgs
Bank Of Commun-H
China Petroleu-H
Hong Kong Exchng
Bank Of China-H
Wharf Hldg
Li & Fung Ltd
Hsbc Hldgs Plc
Power Assets Hol
Mtr Corp
China Overseas
Tencent Holdings
China Unicom Hon
Sino Land Co
China Res Power
Petrochina Co-H
Cnooc Ltd
China Const Ba-H
China Mobile
Lenovo Group Ltd
Hang Seng Index
BBG
code
1 HK
101 HK
1044 HK
1088 HK
11 HK
1109 HK
1199 HK
12 HK
1299 HK
13 HK
135 HK
1398 HK
144 HK
151 HK
16 HK
17 HK
1880 HK
1898 HK
19 HK
1928 HK
2 HK
23 HK
2318 HK
2388 HK
2628 HK
267 HK
291 HK
293 HK
3 HK
322 HK
330 HK
3328 HK
386 HK
388 HK
3988 HK
4 HK
494 HK
5 HK
6 HK
66 HK
688 HK
700 HK
762 HK
83 HK
836 HK
857 HK
883 HK
939 HK
941 HK
992 HK
Share
price
(HK$)
137.80
22.50
82.70
20.10
129.00
16.78
10.52
51.20
43.80
98.15
8.44
4.94
25.55
10.20
112.40
9.55
9.52
4.69
102.60
44.80
66.15
32.20
58.20
26.60
22.80
12.88
15.58
15.18
18.34
18.52
10.02
5.72
6.23
165.80
3.71
55.00
8.77
76.85
72.55
31.15
20.35
125.70
11.30
12.50
20.45
8.54
11.48
5.58
93.75
10.36
Mkt
cap
(HK$m)
319,167
100,919
101,257
379,163
246,628
97,848
30,933
153,617
527,576
418,450
68,131
1,661,983
65,086
134,599
317,259
82,751
80,294
74,409
150,061
361,387
167,125
75,569
442,157
281,236
609,099
320,755
37,725
59,716
192,792
103,781
19,467
417,905
747,133
193,663
1,034,434
166,657
73,321
1,474,646
154,841
181,380
166,340
1,177,472
270,226
75,196
98,092
1,760,597
512,553
1,392,173
1,911,528
115,086
5d
chg
(%)
-0.9
-2.6
0.9
-4.7
-1.5
-2.0
-0.6
-1.0
-2.8
0.1
-9.5
-3.3
0.4
0.0
-2.9
0.1
-3.2
-5.6
-1.5
-4.5
-2.7
0.2
-3.9
-3.1
-2.1
-5.3
-7.7
-3.4
-0.9
-3.6
-1.2
-4.2
-3.9
-11.4
-3.9
-1.7
-5.6
-1.7
-4.5
0.2
-5.6
-2.9
0.0
-3.7
-4.2
-3.3
-2.0
-3.3
-1.5
-3.0
Ytd
chg
(%)
18.8
-8.2
-9.7
-17.8
2.6
-12.7
-1.1
27.3
12.6
-0.4
-38.2
-5.7
-9.7
-8.9
14.3
3.6
6.1
7.6
12.9
-28.3
7.9
-2.0
-16.2
7.0
-6.0
8.6
-39.5
-7.4
13.5
-17.3
-32.9
4.6
-1.6
28.2
3.9
-7.3
6.9
-8.7
17.7
6.1
-6.7
27.1
-2.6
17.9
11.3
0.5
-20.4
-4.6
16.6
9.9
23,349.6 14,340,750
-2.8
0.2
Source: Bloomberg
Download our reports from Bloomberg: BOCM〈enter〉
–––– 52-week ––––
Hi
Lo
(HK$)
(HK$)
152.00
105.95
27.00
19.80
99.35
74.05
27.00
19.12
133.00
117.60
21.80
13.62
11.92
9.40
56.40
36.46
45.65
34.65
108.50
88.66
14.82
8.38
5.66
4.33
29.80
22.75
13.10
9.32
120.20
90.35
10.48
7.15
10.36
7.25
5.26
3.72
108.00
80.55
68.00
38.70
68.35
56.00
35.00
28.50
76.50
55.60
27.95
21.50
25.80
19.72
16.88
9.35
27.90
15.48
17.26
13.56
18.90
13.91
23.65
17.82
17.22
9.28
6.04
4.53
8.23
5.73
189.00
112.80
3.90
3.03
66.10
46.35
10.70
7.72
87.35
75.75
76.50
57.85
32.30
26.55
24.50
17.52
134.90
82.64
14.22
9.03
14.16
9.83
24.90
17.10
11.70
7.31
16.06
11.22
6.35
4.89
102.20
63.65
12.70
7.62
25,363.0
21,137.6
–––––––––– PE –––––––––––
2013A
2014E
2015E
(X)
(X)
(X)
7.4
9.0
9.3
13.2
16.1
15.9
28.0
26.6
22.1
7.3
7.9
7.8
14.8
14.4
13.3
6.4
8.6
7.2
13.5
11.9
10.6
8.6
16.5
16.2
27.7
21.5
18.7
8.9
12.0
11.5
10.7
10.7
9.8
4.9
5.0
4.7
14.8
15.3
13.9
24.9
24.4
21.2
9.0
14.5
13.5
7.2
10.9
10.6
14.1
13.8
13.2
35.6
42.6
26.5
11.7
15.0
13.6
17.6
17.2
15.7
18.5
15.8
15.5
10.8
11.6
11.0
11.5
9.9
8.8
12.2
11.4
10.4
19.0
15.5
13.2
9.1
9.1
7.7
20.5
60.9
39.0
20.3
17.6
12.0
27.7
25.7
23.8
32.1
28.4
23.0
91.7
32.1
20.4
5.2
5.1
4.9
8.4
8.8
8.8
41.2
37.9
28.1
4.9
4.9
4.6
7.0
14.0
12.4
11.3
17.4
14.9
12.4
11.0
10.2
2.5
17.5
17.9
12.2
17.5
16.1
6.7
7.2
6.2
41.8
38.8
29.6
16.9
16.5
14.3
8.4
14.2
13.7
8.4
8.0
7.4
9.4
9.6
9.3
7.3
7.5
7.8
4.8
4.8
4.5
12.8
13.6
13.6
15.4
16.7
13.8
10.1
10.8
10.1
Yield
P/B
(%)
2.6
3.3
2.2
5.7
4.3
2.7
2.9
2.0
1.0
2.4
2.7
N/A
3.0
2.6
3.0
4.3
1.1
2.2
3.5
3.9
3.9
3.4
1.5
3.8
1.7
2.1
1.6
1.7
1.8
1.5
0.7
N/A
4.9
2.1
6.7
3.2
5.4
4.9
3.5
3.0
2.4
0.2
1.8
4.0
3.7
4.7
5.0
6.8
3.4
2.3
(X)
0.8
0.8
6.1
1.1
2.3
1.1
0.9
0.6
2.4
1.0
1.3
1.0
1.0
9.2
0.7
0.5
2.5
0.6
0.7
8.9
1.8
1.1
1.8
1.7
2.1
0.5
0.7
1.0
3.8
4.4
1.2
0.7
1.0
9.4
0.8
0.6
2.0
1.0
1.3
1.2
1.4
12.4
0.9
0.7
1.5
1.1
1.1
0.9
1.8
4.5
3.7
1.3
Morning Express
21 November 2014
China Ent Index Constituents
Company
name
Shandong Weig-H
China Shenhua-H
Sinopharm-H
China Shipping-H
Zoomlion Heavy-H
Yanzhou Coal-H
Agricultural-H
New China Life-H
Ind & Comm Bk-H
Tsingtao Brew-H
China Com Cons-H
China Coal Ene-H
China Minsheng-H
Guangzhou Auto-H
Ping An Insura-H
Picc Property &
Great Wall Mot-H
Weichai Power-H
Aluminum Corp-H
China Pacific-H
China Life Ins-H
China Oilfield-H
Zijin Mining-H
China Natl Bdg-H
Bank Of Commun-H
Jiangxi Copper-H
China Petroleu-H
China Rail Gr-H
China Merch Bk-H
Bank Of China-H
Dongfeng Motor-H
Citic Securiti-H
Haitong Securi-H
China Telecom-H
Air China Ltd-H
Petrochina Co-H
Huaneng Power-H
Anhui Conch-H
China Longyuan-H
China Const Ba-H
China Citic Bk-H
Hang Seng China Ent Indx
BBG
code
1066 HK
1088 HK
1099 HK
1138 HK
1157 HK
1171 HK
1288 HK
1336 HK
1398 HK
168 HK
1800 HK
1898 HK
1988 HK
2238 HK
2318 HK
2328 HK
2333 HK
2338 HK
2600 HK
2601 HK
2628 HK
2883 HK
2899 HK
3323 HK
3328 HK
358 HK
386 HK
390 HK
3968 HK
3988 HK
489 HK
6030 HK
6837 HK
728 HK
753 HK
857 HK
902 HK
914 HK
916 HK
939 HK
998 HK
Share
price
(HK$)
Mkt
cap
(HK$m)
5d
chg
(%)
Ytd
chg
(%)
7.02
20.10
31.30
4.89
4.27
6.24
3.47
30.30
4.94
54.00
6.97
4.69
7.67
7.14
58.20
13.62
35.75
28.75
3.29
28.35
22.80
14.64
1.99
7.16
5.72
13.12
6.23
5.06
14.52
3.71
11.08
19.44
13.58
4.72
5.26
8.54
8.56
24.15
8.19
5.58
5.08
31,424.13
379,162.73
80,387.58
22,753.55
45,592.30
45,382.73
1,052,187.82
109,874.09
1,661,983.32
69,317.83
125,886.54
74,408.64
274,165.34
57,756.54
442,157.05
190,460.92
117,567.11
53,455.36
59,790.79
241,590.78
609,099.03
90,076.64
63,442.56
38,657.03
417,905.09
54,799.53
747,133.24
115,198.01
343,215.74
1,034,434.30
95,466.61
204,749.11
139,612.86
382,000.78
75,352.24
1,760,596.66
116,635.18
116,854.61
65,818.03
1,392,172.90
276,338.31
-10.8
-4.7
-5.3
-10.8
-9.1
-12.5
-3.6
-5.9
-3.3
-1.6
-1.6
-5.6
-4.6
-6.7
-3.9
-2.2
-3.6
-5.6
-7.8
-4.7
-2.1
-8.4
-9.1
-2.5
-4.2
-5.5
-3.9
-1.4
-2.7
-3.9
-1.1
-5.2
-7.1
-6.3
-4.9
-3.3
-5.7
-4.2
-3.0
-3.3
-7.5
-32.9
-17.8
40.7
-18.8
-41.0
-11.9
-8.9
16.5
-5.7
-17.6
11.5
7.6
6.9
-15.8
-16.2
23.1
-16.5
-8.0
21.9
-6.7
-6.0
-39.1
19.9
-14.1
4.6
-6.3
-1.6
26.5
-12.1
3.9
-8.7
-8.1
0.6
20.4
-9.2
0.5
22.1
-16.0
-18.0
-4.6
20.7
11.2
27.0
34.5
6.3
8.0
8.7
4.1
32.8
5.7
68.3
7.2
5.3
8.1
10.8
76.5
14.4
48.5
35.5
3.9
33.5
25.8
24.7
2.3
9.1
6.0
15.3
8.2
5.3
17.4
3.9
15.2
21.7
15.2
5.2
6.3
11.7
9.7
35.7
10.3
6.4
5.5
6.9
19.1
19.7
4.0
3.5
4.9
3.0
21.1
4.3
53.1
4.9
3.7
5.9
6.7
55.6
9.4
26.1
25.8
2.5
23.6
19.7
14.0
1.6
6.7
4.5
11.6
5.7
3.0
12.1
3.0
9.6
13.7
9.5
3.1
4.2
7.3
6.1
24.1
7.1
4.9
3.6
81.1
7.3
24.7
N/A
14.1
6.6
5.0
12.5
4.9
29.0
6.9
35.6
4.6
11.5
11.5
13.7
10.6
8.7
N/A
19.0
19.0
6.7
16.0
4.9
5.2
10.1
8.4
8.6
5.0
4.9
5.6
21.3
24.4
16.2
19.4
9.4
8.2
8.3
26.7
4.8
4.6
24.3
7.9
22.5
45.4
13.7
16.4
4.8
10.8
5.0
28.0
6.6
42.6
4.3
10.2
9.9
12.1
10.5
9.6
N/A
17.1
15.5
6.9
14.3
5.3
5.1
13.0
8.8
8.2
5.0
4.9
5.9
22.3
18.5
16.2
16.4
9.6
7.7
8.6
20.0
4.8
4.5
10,379
4,185,214
-3.9
-4.0
11,638.3
9,159.8
7.2
7.1
Source: Bloomberg
Download our reports from Bloomberg: BOCM〈enter〉
–––– 52-week ––––
Hi
Lo
(HK$)
(HK$)
––––––––––– PE –––––––––––
2013A
2014E
2015E
(X)
(X)
(X)
Yield
P/B
(%)
(X)
19.9
7.8
18.7
13.9
11.1
15.7
4.5
9.8
4.7
24.6
6.1
26.5
4.1
7.8
8.8
11.1
8.2
9.4
N/A
14.5
13.2
6.9
14.2
4.9
4.9
13.2
8.8
7.4
4.5
4.6
5.6
19.4
15.9
14.6
11.6
9.3
7.5
8.0
14.7
4.5
4.2
1.1
5.7
1.1
0.0
4.4
0.4
N/A
0.6
N/A
N/A
3.4
2.2
2.6
3.2
1.5
2.1
2.9
1.1
N/A
1.8
1.7
3.7
N/A
2.8
N/A
4.8
4.9
1.7
5.4
6.7
2.1
N/A
1.1
2.5
1.1
4.7
5.6
1.8
0.7
6.8
N/A
2.6
1.1
2.9
0.6
0.6
0.6
0.9
1.7
1.0
3.7
0.9
0.6
0.9
1.1
1.8
2.3
2.9
1.4
0.9
1.9
2.1
1.2
1.3
0.8
0.7
0.8
1.0
1.0
1.0
0.8
1.1
1.8
1.6
1.1
1.0
1.1
1.5
1.7
1.6
0.9
0.8
6.5
4.5
1.1
Morning Express
21 November 2014
BOCOM International
11/F, Man Yee Building, 68 Des Voeux Road, Central, Hong Kong
Main: + 852 3710 3328
Fax: + 852 3798 0133
Rating System
Company Rating
www.bocomgroup.com
Sector Rating
Buy: Expect more than 20% upside in 12 months
LT Buy: Expect more than 20% upside but longer than 12 months
Neutral: Expect low volatility
Sell: Expect more than 20% downside in 12 months
Outperform (“OP”): Expect more than 10% upside in 12 months
Market perform (“MP”): Expect low volatility
Underperform (“UP”): Expect more than 10% downside in 12 months
Research Team
Head of Research
@bocomgroup.com
(852) 2977 9393
raymond.cheng
(852) 2977 9384
hao.hong
(852) 2977 9212
yangqingli
Shanshan LI, CFA
(86) 10 8800 9788 - 8058
lishanshan
Li WAN, CFA
(86) 10 8800 9788 - 8051
Wanli
Raymond CHENG, CFA, CPA, CA
Strategy
Economics
Hao HONG, CFA
Banks/Network Financials
Qingli YANG
miaoxian.li
Fei WU
(852) 2977 9392
fei.wu
Tony LIU
(852) 2977 9390
xutong.liu
Alfred LAU, CFA, FRM
(852) 2977 9235
alfred.lau
Toni HO, CFA, FRM
(852) 2977 9220
toni.ho
Luella GUO
(852) 2977 9211
luella.guo
(86) 21 6065 3606
louis.sun
(852) 2977 9209
lizhiwu
(852) 2977 9216
miles.xie
Geoffrey CHENG, CFA
(852) 2977 9380
geoffrey.cheng
Ian FENG
(852) 2977 9381
Yinan.feng
(86) 21 6065 3675
wei.yao
Property
Phoebe WONG
(852) 2977 9391
phoebe.wong
Anita CHU
(852) 2977 9205
anita.chu
Consumer Staples
Renewable Energy
Summer WANG
(852) 2977 9221
summer.wang
Shawn WU
(852) 2977 9386
shawn.wu
Johnson SUN
(852) 2977 9203
johnson.sun
Milo LIU
(852) 2977 9387
milo.liu
(852) 2977 9389
liwenbing
Healthcare
Louis SUN
Telecom & Small/ Mid-Caps
Insurance & Brokerage
Zhiwu LI
Technology
Internet
Miles XIE
Transportation & Industrial
Yuan MA
(86) 10 8800 9788 - 8039
yuan.ma
Connie GU, CPA
(86) 10 8800 9788 - 8045
conniegu
(852) 2977 9243
jovi.li
Metals & Mining
Jovi LI
(86) 10 8800 9788 - 8043
Miaoxian LI
Oil & Gas/ Gas Utilities
Consumer Discretionary
Jerry LI
@bocomgroup.com
Automobile
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Wei YAO
Morning Express
21 November 2014
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