Saturday, June 4, 2011

5G名人论坛 第2集:陈凯希的海鸥人生(上集)~第1节:从政党走入商界




















Source/转贴/Extract/: youtube
Publish date:11/01/11

Weekend Comment Jun 3: Bumpy ride ahead for airlines

THE INTERNATIONAL AIR Transport Association (IATA) is expected to cut its profit forecast for global airlines this year at its annual general meeting — to be held here from June 5 to 7. In March, the IATA, which represents some 230 airlines, forecasted that the industry would report US$8.6 billion ($10.6 billion) in profits this year. However, DMG analyst Melissa Yeap points out in a client note that this forecast was based on average oil prices of US$96 per barrel. Since then, oil prices are nearer to US$110.

Yeap is concerned that higher fuel costs — which often lead to fuel surcharges on ticket prices — could negatively affect demand for air travel. In April, Singapore Airlines (SIA) raised its fuel surcharge by between US$4 and US$32 per sector, adding as much as US$266 to the price of economy class tickets to the Americas. Yeap says that fuel accounts for 30% of the operating costs of full service carriers and 40% for low cost carriers. The recent earthquake in Japan has also curbed travel activity.

Weaknesses are showing up in earnings and operating statistics. SIA, for instance, carried 6.3% fewer passengers in April. Its capacity, however, rose 11.2%. This resulted in the passenger load factor falling by three percentage points to 74.6%. For the quarter ended March, SIA’s revenue rose 7.5% but its net profit fell 38.5% on higher fuel costs. Meanwhile, Tiger Airways reported 16.1% revenue growth and a 94.2% plunge in net profit.

In Malaysia, Tiger Airways’ competitor AirAsia is experiencing similar pressures. Although revenue rose 20.4% in the quarter, net profit fell 22.3%. And national carrier Malaysian Airline System reported a net loss of RM242.3 million ($99.2 million) versus a profit of RM310 million a year ago.

Even as traffic demand slows, however, airline capacity seems to be on the rise. All the major airlines in the region intend to grow capacity this year. SIA has announced its intentions to set up a low-cost airline this year for medium- and long-haul routes, competing with AirAsia X. Meanwhile Thai Airways International says it intends to set up a low-cost airline that will compete in the middle market with SilkAir.

Investor confidence has been dealt a further blow as majority shareholders have pared their stakes. Tune Air Sdn Bhd, the private vehicle of AirAsia founder Tony Fernandes, has pared its stake by 2%. And Tiger Airways CEO Tony Davis recently sold a million shares or a quarter of his stake at $1.42, below its IPO price of $1.50.

Are airlines still worth a look? Most analysts remain positive on SIA’s prospects. Deutsche Bank analyst Joe Liew says in a May 30 note that SIA’s stock still looks inexpensive. With $5.8 billion in net cash on its balance sheet as at the end of March, Liew believes SIA can continue to pay generous dividends and is forecasting a 5% dividend yield for FY2012 (the company has a March year-end). That would put SIA’s dividend yield among the highest of the regional airlines. Although he admits that the short-term weakness in load factors will lead to an unexciting share price performance in the near term, he maintains his “buy” call on the stock as it trades at 1.2 times its forecast price-to-book ratio for FY2012.

Analysts are less optimistic about Tiger Airways. Citigroup analyst Rigan Wong recently downgraded his call on the stock to a “sell” as it believes the company could face difficulties as it seeks to expand in the Philippines, Indonesia and Thailand at the same time while still attempting to reverse its losses in Australia.

Meanwhile, weaker traffic numbers could also affect demand for the maintenance, repair and overhaul services that companies like ST Engineering and SIA Engineering provide. SATS, which supplies food to airlines and also provides gateway services like baggage handling and aircraft interior cleaning, could also see weaker revenues.

SIA Engineering recently reported an 18% decline in its net profit for the quarter to March. Although the company has managed to improve its margins, analysts are concerned about challenges going forward. ST Engineering faces similar challenges, but is somewhat shielded by its other business segments such as defence and electronics so analysts continue to like it for its defensive nature and steady dividend payouts.

Kim Eng analyst Gregory Yap sees strong winds ahead for SATS as the company enters an aggressive expansion mode. He sees the company potentially lowering dividends ahead as it tries to reserve cash for acquisitions. “However, unless the acquisition is very good, we are concerned this more aggressive stance amid strong cost pressures and a slowing aviation market will overhang the stock.”





Source/转贴/Extract/: http://theedgesingapore.com
Publish date:03/06/11

同意更大削支‧希臘獲額外援助

Created 06/03/2011 - 19:30

《路透社》引述接近談判的消息人士稱,歐元區高官原則上已經同意對希臘進行新一輪的國際援助,這將給予該國更多時間解決債務危機。

消息人士稱,由歐元區17國副部長和高級官員組成的經濟與金融委員會在維也納的談判中原則上通過該計劃,談判在凌晨結束。

他補充,第二輪紓困方案實際上將取代去年5月推出的1千100億歐元紓困協議,並將延續至2014年中期,較原協議延長一年財政支持。

新計劃細節未定

這項消息似乎解除了希臘3千300億歐元主權債務今年出現違約的風險。不過,該新計劃仍有很多方面不確定。消息人士稱,援助計劃的具體規模,以及每個機構捐助的數額,都仍需在20日召開的歐元區財長會議前決定。

消息人士補充,新計劃將涉及民間部門投資者的參與,但這種參與有限,以避免引發“信用事件”。信用事件將致使希臘債券持有人蒙受損失,並令希臘評級遭下調等。

消息人士表示,新援助計劃在假定希臘在今年或明年無法重新在資本市場融資的情況下,滿足希臘的融資需求。最初援助計劃假定希臘明年能在市場籌資270億歐元,2013年能籌資380億歐元。

他補充,新計劃將包括希臘在一個新的國家財富機構的管理問題上,以及具體私有化的時間上作出詳細承諾,但未規定對該國家財富機構進行國際監督。

一希臘政府高官表示,希臘方面打算在3日提交新的撙節計劃。該新預算計劃將包括更快私有化,以及涵蓋增稅在內的64億歐元節約新舉措。

希臘總理帕潘德里歐(George Papandreou)將於3日向歐元集團主席容克遞交措施細節。


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Source/转贴/Extract/:biz.sinchew-i.com
Publish date:04/06/11

人民幣走強帶高亞幣‧馬幣印尼盾“沾光”

Created 06/04/2011 - 12:41

(吉隆坡3日訊)馬幣及印尼盾幣值與人民幣匯率走勢的關係愈加密切,這也意味著中國政府讓人民幣繼續走強,馬幣與印尼盾也將繼續“沾光”而大放異彩。

匯豐全球研究報告透露,大馬經濟對外來的震盪具有防震力,強勢的投資資金流入仍難以抵擋,馬幣匯率在區域應當有一番作為。

人民幣成亞洲貨幣主軸

人民幣將成為亞洲貨幣的主軸,馬幣匯率的走向也顯然從歐元轉向以人民幣為馬首是瞻;最新的調查顯示,比較人民幣定匯,馬幣對歐元的反應較微弱,在中國讓人民幣增值前提下,也增添馬幣的樂觀局面。

與此同時,報告也指出,近數周的歐元走貶,但亞洲貨幣仍然強韌,人民幣的走強,有助扶托亞洲貨幣的強勢。

匯豐認為,比較過去,亞洲貨幣對美元與人民幣的反應更加顯著,對歐元的關係儘管仍然強勢,但減退不少。

“只要人民幣繼續自我增值,美元與亞洲貨幣的上部風險將受到調控。”

調查顯示,亞洲貨幣的走勢與人民幣走勢越加亦步亦趨,如果人民幣出乎意料的走弱,亞洲貨幣將出現不均勻的脆弱情況。

基於人民幣逐步走向國際化,將充當亞洲貨幣的區域定點,就像歐元的影響力一樣,把英鎊及瑞典克朗推向其範疇,人民幣對亞洲貨幣的影響也是一樣。

“以長期而言,這進展將是人民幣循序漸進趨向展現儲備貨幣特徵。”

報告指出,不排除歐元對亞洲匯率的影響力,歐元與亞洲貨幣的關係在追蹤期間(2005年7月至2008年7月以及2010年6月至今)仍然相當密切,人民幣也愈加重要。

歐元兌美元及美元兌人民幣定匯的表現背道而馳,基於亞洲貨幣普遍傾向人民幣定匯的變動,因此,匯豐認為,美元兌人民幣定匯將繼續走低,區域貨幣應當表現卓越。

有鑒於此,只要人民幣兌弱勢歐元脫鉤及美元兌人民幣持續定匯,美元兌亞洲貨幣的上部風險在某些程度已減緩。

廣泛趨勢圖顯示,亞洲貨幣對人民幣定匯的弱勢普遍敏感,以整體各別貨幣分析,在某個程度上反映此趨向,當中原因包括政策、部署及投資者預期的關係。

首先,儘管一些當局允許貨幣增值有更大的空間,但區域整體上仍然稍微抗拒貨幣的增值,這類持續性的不對稱政策,也表示當美元兌人民幣定匯率走高,決策者較喜愛讓貨幣稍微貶值多過增值。

再者,亞洲投機性的部署已有一段時間,資金涌入債券及股市在2010年激漲,使投資部署在亞洲貨幣走弱時面對更大的調整風險。

此外,投資者心理已預期美元兌人民幣匯率的走低,他們普遍認為,人民幣需要進一步增值,因此,美元兌人民幣定匯將定得更高。


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Source/转贴/Extract/: biz.sinchew-i.com
Publish date:04/06/11

China drought unlikely to hit most S-chips

Business Times - 04 Jun 2011

CORPORATE FOCUS
China drought unlikely to hit most S-chips

Their operations are not centred on the affected provinces of Hubei and Hunan

By LYNETTE KHOO

CHINA'S worst drought in 60 years is expected to cut crop yields and lift prices further, but most S-chips or Singapore-listed Chinese firms in the agricultural sector could be spared any severe impact.

Companies that cultivate crops in or derive sales from the central region of China would be the worst-hit, as farmers in much of Central China's Hubei and Hunan provinces struggle to plant crops on the parched land or keep fish ponds stocked.

For China Minzhong, whose largest shareholder is Singapore sovereign wealth fund GIC, most of its farmland is located in Fujian province, which has received intermittent rain lately. Its cultivation base in Hubei province in central China remains irrigated.

'Historically, our Hubei operations contribute less than one per cent of our group's revenue in the fourth quarter ending June 30 (our off-peak season),' said chief financial officer Ryan Siek.

Sino Grandness, which manufactures and distributes bottled juices and canned fruits and vegetables, said it does not have any production in the key areas affected by the drought.

The production of its key product, white asparagus, in its plants in Shandong and Shanxi continues to run smoothly in the second quarter ending June 30, which is typically the peak season, according to Parry Ng, vice-president for corporate communication and investor relations.

Yamada Green Resources also noted that there is unlikely to be a financial impact from the severe drought. Its investor relations manager Kim Chew explained that the harvesting period for shiitake mushrooms - from September to April - is already over, while raw material prices for its processed food products have remained stable.

DMG & Partners Securities analyst Tan Han Meng recently issued 'buy' calls on China Minzhong, Yamada and Sino Grandness but noted that higher fresh vegetable prices could continue to weigh on margins at Yamada's processed food segment.

One S-chip, however, that is feeling the heat of China's severe drought is China Farm Equipment, which derives much of its sales from products like combine harvesters, ploughing machines and diesel engines in the central and southern region of China.

'The current drought in certain part of Hunan, Hubei and Jiangshu provinces may affect the sales of combined harvesters in the next two months as there would be less paddy crops to harvest if the drought situation persists,' said its chief financial officer Eric Sho.

'Although it may have a negative impact on our current year's financial performance, it is still premature to gauge the magnitude of financial impact at this juncture,' he added. Should the situation persist, the group will shift its sales focus to other unaffected provinces such as Shanxi, Henan and Liaoning.

Mr Tan of DMG noted that China Farm could see lower demand for its combine harvesters if the drought persists and paddy crops are affected, but maintained a 'buy' call on the stock based on earlier projections of continued strong earnings.

Earlier on, Chinese companies have been bracing themselves against rising labour and raw material costs, higher interest rates and a rising yuan. They now find themselves having to fend off heightened weather risks in China.

'In our industry, it is a norm to have an 'Act of God' clause in our contracts with customers, where we will be protected against any penalties for non-deliveries in the event of crop failures under unforeseen weather conditions,' said China Minzhong's Mr Siek.

He noted that China Minzhong also benefits from being able to select premium farmland in areas less prone to floods and droughts and having irrigation and drainage systems to enhance yield and mitigate weather adversities.

For Sino Grandness, its production facilities span across a few provinces in China to reduce concentration risks, said Mr Ng. Its relationship with third-party suppliers across China also provides a safety net against any sudden surge in orders or shortages in supply.

As a longer term measure, the company has been expanding its range of products that have different production seasons during the year and sources raw materials for its bottled juices from different parts of China, Mr Ng added.



Source/转贴/Extract/: www.businesstimes.com.sg
Publish date:04/06/11

CapLand buys Wuhan firm

Business Times - 04 Jun 2011


CapLand buys Wuhan firm

CAPITALAND has acquired Wuhan Kaihui Real Estate Co for 361 million yuan (S$68.8 million). The Singapore property group bought its full stake in Kaihui from a party unrelated to CapitaLand.

The Chinese firm owns a 124,737 square metre plot of land in the Caidian district of Wuhan, Hubei. Kaihui's plans to develop the land into 2,000 homes will be led by CapitaLand's new subsidiary, CapitaValue Homes. This will be its first project to build affordable homes in China.

The Kaihui stake will be held by CapitaLand through its wholly owned subsidiary Bellevale. The acquisition is not expected to have any material impact on CapitaLand's net tangible assets or earnings per share for this financial year. CapitaValue Homes recently acquired a 65 per cent stake in Vietnam's Quoc Cuong Sai Gon to lead the development of 800 homes in Ho Chi Minh City. CapitaLand launched CapitaValue Homes last year to grow its low-cost residential business in China and Vietnam.



Source/转贴/Extract/: www.businesstimes.com.sg
Publish date:04/06/11

Tony Fernandes sells 2% stake in AirAsia

Business Times - 04 Jun 2011


Tony Fernandes sells 2% stake in AirAsia

A positive move, say analysts, as it would atrract more local funds

By PAULINE NG
IN KUALA LUMPUR

ALREADY a hit with foreign investors, AirAsia could be making gains with local institutional funds going by a recent disposal of 55.5 million shares by its founder Tony Fernandes to a domestic long-term institutional investor.

Amounting to 2 per cent, the stake was transacted off-market at the end of May by Mr Fernandes' private vehicle Tune Air, according to filings to the exchange. Analysts said the stake was sold to the country's largest fund Permodalan Nasional at RM2.85 a share, netting Tune Air slightly over RM158 million.

Although the market generally does not like founders selling down their stake, this move is seen as positive for the airline as it positions itself to attract more local funds, which in turn will mitigate concerns of foreign selling, said OSK Research.

Indeed, in its filing, the region's largest budget carrier remarked that 'the disposal is to broaden the local long-term institutional investors' base and increase the level of shareholdings by the same.'

Such is its following overseas that the company has one of the highest foreign shareholdings among entities listed on Bursa Malaysia, and in January had reached 51.55 per cent, exceeding the 45 per cent limit allowed by foreigners.

That local investors have tended to undervalue and perhaps not appreciated the company's growth prospects and valuations has in the past irked Mr Fernandes who initially said he was contemplating a foreign bourse when the budget carrier's long-haul unit AirAsia X undertakes a floatation exercise later this year, but has more recently talked about a dual listing.

Given that it has already overtaken national and legacy carrier Malaysia Airlines (MAS) in terms of market capitalization and performance, the recent pick-up in interest among local retailers and funds is not unexpected. AirAsia declared a maiden dividend last year - albeit a nominal one - but investors stand to further gain when its Thai and Indonesian units undertake a public share sale of their own some months down the road.

MAS' posting of a RM267 million operating loss for the first quarter to end March has raised questions about its prospects this year. Despite also battling higher fuel costs, AirAsia managed a RM242 operating profit for the same period, prompting OSK Research to maintain its buy call on the stock with an unchanged target price of RM3.89 based on 12x FY11 EPS. 'We anticipate traffic momentum and load factor continuing to be encouraging over the coming quarters despite the imposition of a fuel surcharge,' the broker said of the AirAsia which was last traded at RM3.00.

Tune Air currently holds 23.08 per cent of the company while the country's biggest pension fund owns 8 per cent. Capital Research Global Investors and Genesis Smaller Companies count as its larger foreign institutional shareholders, owning 7.3 and 5.4 per cent, respectively.

For Mr Fernandes, the RM158 million could come in handy given his recent tilt at a takeover of West Ham. Already involved in F1 through Team Lotus, the sports crazy entrepreneur this week tweeted he had made a bid for the club which was recently relegated from the English Premier League. 'For all you West Ham fans, an offer has gone to the present owners of West Ham. Let's see if they accept.'

It is his second shot at helming his favourite club, an earlier attempt not finding its mark. Still, he indicated he would be fine if nothing comes of it. 'If it goes quiet, it goes quiet.'


Source/转贴/Extract/: www.businesstimes.com.sg
Publish date:04/06/11

SIA takes on low-cost-carrier market

Goh Choon Phong, who took over as CEO of Singapore Airlines only in January, is in what could be a make-or-break career move. On May 25, SIA said it would launch a budget-carrier service of its own within a year. The new no-frills, low-fare airline will serve medium- and long-haul routes using some of its parent’s wide body air-craft, according to a statement from SIA

This is a significant departure from SIA’s un-wavering and successful focus on premium and business travellers over the past decades. Despite soaring oil prices, periodic slumps in air travel due to economic crises and terrorist scares, and persistent competitive pressure from burgeoning low-cost carriers (LCCs), Goh’s predecessors managed to keep the airline among the most profitable in the world.

For the financial year to March 2011,SIA reported earnings of nearly $1.1 billion. Now, Goh is betting that SIA could be much bigger if it creates a budget service in the medium- and long-haul space instead of just focusing on its full-service operation. “We have observed on short-haul routes within Asia, low-fare airlines help stimulate demand for travel, and we expect this will also prove true for longer flights,” Goh said, in a statement

The Centre for Asia Pacific Aviation (CAPA)says that operating a budget service is a major refocus in strategy for SIA. “The message is that the carrier, despite its very high-quality product, cannot grow profitably by only focusing on the top end of the market.”SIA has seen its market share at home shrink steadily since the advent of budget carriers as well as the continued liberalisation of Singapore’s aviation space.

Notably, it lost its lucrative duopoly with Malaysian Airlines on the shuttle flights between Singapore and Kuala Lumpur in 2008, with a number of low-cost carriers having since taken on that route. Over the last three years, SIA has seen its share of passenger traffic at Changi Air-port shrink from about 50% to about 35%, ac-cording to CAPA

Meanwhile, SIA’s efforts to expand into new routes haven’t gone all that smoothly. The air-line has said it has faced difficulty increasing its frequencies to top Chinese cities such as Beijing and Shanghai owing to the lack of slots at the airports. The Singapore carrier has also been thwarted in its attempts to operate the lucrative Australia-US route.

With a budget-carrier unit, SIA could stimulate new demand for air travel by getting into underserved routes to secondary airports. It could also position its budget carrier on its own established, high-frequency routes as a means of fending off competition from other low-cost carriers.

In fact, CAPA notes that SIA’s new budget carrier could hurt existing LCCs, particularly those that ply routes to Australia as well as North Asia and Europe, such as Qantas and AirAsia X. It adds that the SIA budget-carrier unit would benefit from SIA’s extensive network, and “a sufficiently low-cost operation could also allow SIA to launch new Australian gateways such as Cairns

Mixed reactions
Despite the apparently sound logic for SIA to venture into the budget space, news of its plans came as a surprise to most aviation-sector watchers. Nevertheless, the initial reaction from analysts has mostly been positive.

UBS analysts Eric Lin and Richard Wei say that LCCs would have continued to chip away at SIA’s market share if it did nothing. “At least, we view this attempt as a pro-active move to address its own problems,” they say in a May 26 note.

UOB Kay Hian analyst K Ajith says SIA’s choice of medium- and long-haul routes would keep it clear of the current tight LCC competition on short hops, while helping it gain exposure to a wider customer base. “It appears that it’s difficult to raise yields, so SIA needs to go for volume growth, and that is through the LCC sector,” he says.

In fact, by adopting a low-cost model for medium- and long-haul routes, SIA might be conferring a degree of credibility on the LCCs that have gone before it, suggests Citigroup analyst Rigan Wong in a May 26 report. “SIA’s planned venture into long-haul LCC gives the model as tamp of approval from one of the most respected airlines globally.”

Other LCCs see SIA’s imminent entry into their sphere somewhat differently. Tony Fernandes, the flamboyant CEO of AirAsia, responded to the news of SIA’s budget carrier on microblogging service Twitter within hours: “Déjàvu,” he tweeted. “AirAsia staff should be proud that we have been copied again. Will be same result like Tiger [Airways].”

Fernandes later told The Edge Singapore that he’s “very, very proud” of SIA’s recognition of the low-cost model, and added that SIA probably now realises that it needs to do some thing in order to remain relevant and protect its market share. “They laughed at us before and now they have to start their own,” he says.

Will the SIA budget carrier pose significant competition for AirAsia? “Same question people asked me when Tiger first started,” Fernandes says. “Now [Tiger] has 20 planes. We have 100.They broke even, but we made RM250 million in profit in 1Q2011"

On the other hand, Jetstar, which started flying to Melbourne from Bangkok in 2006, says it is continuing to expand its long-haul routes and will take delivery of at least one more long-haul aircraft by year-end. “Given the success we have with the value-based long-haul model, we would expect others to adopt the model,” says a spokes-woman for Jetstar. “We believe we can maintain a leadership position in the evolving competitive market.”

Execution risks
Much ultimately depends on how well CEO Goh manages SIA’s foray into the low-cost sector. SIA says its new budget carrier will be managed separately, but that its CEO will be drawn from SIA’s ranks. Analysts say that’s not a bad thing as SIA has generally faired better with businesses developed in-house than acquisitions like Air New Zealand and Virgin Atlantic.

Yet, SIA’s only significant involvement with a LCC so far is the backing it provided to Tiger Air-ways. It initially held a 49% stake, but this has been whittled down to 32.8% since Tiger Air-ways’ listing. However, Tiger Airways had other backers too, including the family of the Ryanair founders. Its CEO Tony Davis, who has helmed Tiger Airways since January 2005, had previously helped launch bmi baby, the LCC unit of the UK’s BMI Group

Moreover, SIA is attempting to position its budget carrier on longer-haul routes, where the failure rate has been high, according to MorganStanley. The research house figures that the budget carrier will need to keep its costs below four US cents per available seat kilometer in order to compete successfully. AirAsia X operates with costs of about three to four US cents per available seat kilometer, while analysts estimate Jetstar’s costs are about seven US cents.

CEO Goh also has to consider the risk of SIA’s budget carrier eating into its own economy class market. Ajith says SIA will probably be affected, but the extent of the cannibalisation hinges on the price points, as well as route overlap, flight timings and airport access. Ajith expects the LCC service to cater to North Indian and second-tier Chinese cities, as well as Europe, using SIA’s current Boeing 777s, or even reconfigured Airbus A380s,especially for flights to Europe

Despite SIA not having much of track record in the low-cost sector, analysts say the new budget carrier stands a good chance of succeeding be-cause of its parentage.

Morgan Stanley, for one, says SIA’s “strong branding and deep pockets allow the new carrier to progress faster than potential entrants with no parental support. Comparative cost ad-vantage in aircraft purchases and established global network infrastructure in SIA will position the new carrier to compete effectively.”The brokerage has an “overweight” rating on the counter with a price target of $18.80.

Ajith is also relatively sanguine about SIA’s chances in the budget sector. “SIA is still one of the best-managed airlines, not just in Asia but in the world,” he says. “It reads the market relatively well, in terms of capacity, and is well aware of the competitive landscape.” UOB Kay Hian is maintaining its “hold” call on the stock with a price target of $15.

Citigroup’s Wong says the venture allows SIA to tailor its services to a wide range of customer demands, leading to “minimal dilution to SIA’s brand for premium short- and long-haul services.” But it’s a defensive move in a difficult market and competition could erode SIA’s market share and adversely affect its profitability. He has a “sell” rating on SIA, given the tough outlook for the premium-travel market. — Additional reporting by Kang Wan Chern

Source/转贴/Extract/: Theedgeweekly Singapore
Publish date:30/05/11

Strategy – 1QCY11 Report Card (HLG)

Strategy – 1QCY11 Report Card
FBM KLCI Target – 1,720

1QCY11 Report Card
 The recently concluded reporting season (for 1QCY11) was slightly disappointing.

 Of the 45 stocks under our universe that reported their results, 10 were below HLIB’s expectations while only four surprised on the upside. Against consensus, 13 were below while only three came in above.

 Sectors that disappointed (based on number of stocks that fell short of expectations) were transport, plantation, construction and technology. On the other hand, only the banking sector was slightly ahead of expectations.

 Major rating downgrades were MAS (Hold to Sell), Digi (Buy to Hold), Affin (Buy to Hold) as well as Sunway and SunCity (both from Buy to Hold as potential upside to their general offer prices is now very limited). Major upgrades were TNB and MahSing (both from Hold to Buy).

 All in, HLIB had 18 earnings downgrades and nine earnings upgrades (inclusive of earnings changes following the electricity tariff hike).

 As a result, HLIB’s 2011 EPS growth projected has been cut from 12.2% to 11.4% but 2012 EPS growth projection has been raised from 10.1% to 13.6%.

Outlook
 Slightly weak reporting season, recent weak external economic data, lingering European debt woes and uncertainties arising from completion of QE2 coupled with school holidays in Malaysia and Singapore as well as the summer holiday may dampen sentiment in the immediate term and result in continued lackluster trading activities.  However, our longer-term positive outlook remains intact as ETP is gaining traction, wealth creation culminating in continue consumption, Petronas contract awards, stronger 2H economic growth as well as wide interest rate and growth differential.

Risks
 Domestic – fiscal position, rising interest rate and SRR beyond expectations and General Election.

 External – inflation, geopolitical, China over tightening, lingering European debt woes, weak external economic data and faster-than-expected pace of QE unwinding.

Summary & KLCI Target
 Remained positive with unchanged year-end FBM KLCI target of 1,720 (15x 2012 earnings).

 Continued to advocate accumulate on dip (especially dip during external uncertainties).

Sector Weight & Stock Picks
 Sector weightings are listed in Figure 2 while our fundamental stock picks are listed in Figure 3.



 In the immediate term, stocks that could attract interest are: 1) RHB Cap – M&A excitement; 2) Boustead – finalization of OPVs contract; 3) Mudajaya – formal award of the Janamanjung extension project; and



Source/转贴/Extract/: HLIB Research
Publish date:03/06/11

Bearish Mind, Bullish Heart (Kenanga)

Review for 1QCY11 Results
Bearish Mind, Bullish Heart
Our mind is bearish, but our heart is bullish. Fundamentally speaking, we saw marginal earnings downgrade post 1QCY10 results while these results were largely within our and consensus estimates. Target prices for most of the stocks, however, were revised up, as some analysts have rolled over their valuations base year to FY12, especially those companies that with financial year‐end earlier than 30‐June. As such, the probability for the index to overcome 1,650 should increase as per our simulation study and higher target price of FBMKLCI of 1,720 (vs. 1,670 previously), which is also inline with consensus estimates of 1,720 (vs. 1,690 previously) as well, on the back of FY11 and FY12 net earnings estimates of 23.6% and 8.8%, respectively, (vs. 25.1% and 8.8% previously). At 1,720, FBMKLCI is estimated to be valued at 17.4x and 15.3x against its FY11 and FY12 consensus earnings estimates respectively. Note that these target levels are on a trailing 12‐ month basis. Therefore, should we prorate these index levels, the year‐end index target is expected to register at 1,640. All in all, we are cautiously optimistic, despite the uncertainties over the timing of General Election and overseas equity market as well as the threats of inflation and interest hike. As for our investment strategy, we prefer to go back to the basic – buying/accumulating into dips and focusing into blue chips.

• Brief recap. Recall that in our “2Q11 Half‐Time Review” dated 16 May 2011, we have mentioned that the probability for FBMKLCI to dip below 1,450 has declined in contrast to 1½ months ago and at the same time, the probability for FBMKLCI to overcome 1,650 has increased, as per our Monte Carlo Simulation Study. Besides, our 2Q11 Investment Strategy has been able to sail through the sea of uncertainties. In fact, our Low Beta Model Portfolio has out‐performed FBMKLCI by 35bps in terms of price performance and much higher at 182bps if and when we take dividends received into considerations (see Figure 1).

• Latest updates and developments. The afore‐mentioned view is also reinforced by the strong performance of FBMKLCI thus far. In May 2011, FBMKLCI was the very few equity markets around the world (apart from JCI) that had recorded gains (see Figure 2), despite the lingering concern over the Euro‐Zone debt crisis; recent hikes in the interest rate, statutory required reserve as well as gas and electricity tariffs. Coupled with the recent strong performance of FBMKLCI, the probability for the index to overcome 1,650 should increase in tandem with the index movement. Hence, we are getting more optimistic about the outlook of FBMKLCI going forward even thought we
saw a weaker‐than‐expected set of 1QCY11 financial results.

• 1QCY11 results review. Based on our sampling that comprises of 218 stocks, we notice that the annualized aggregate reported results were 4.0% belowthan‐ expected (despite a 22.7% YoY growth based on YTD figures, see Figure 3).

• Most of the disappointments were coming from non FBM100 component stocks, which were 24.1% weaker than consensus estimates. As for the FBM100 component stocks, their results were largely within expectations with only a marginal 1.7% lower than consensus estimates.

• As a result, we saw consensus estimates for FBM100 and non FBM100 stocks were revised down by 0.7% and 2.5%, respectively, as at 31 May 2010, based on our 218‐stock sampling (see Figure 4).

• Based on Kenanga Research’s Big Cap Earnings Universe, the FY11 net earnings growth rate has revised down to 23.6% from 25.1% (as at 1 April 2011) while the net earnings growth rate for FY12 remains unchanged at 8.8%. On calendarised basis, a net earnings growth rate for CY11 has lowered to 15.0% from 18.2% previously (see Figure 5).

• Revising up index target. Despite revising down our earnings estimates, we, however, revised up our target FBMKLCI level to 1,720 (from 1,670 previously) due mainly to higher target prices for the respective stocks under our big cap earnings universe. This is because some of our analysts have rolled over their valuation base year to FY12. This revised index target is also inline with the consensus estimate of 1,720 (as at 31 May 2011, see Figure 6, vs. 1,690 as at 1 April 2011).

• At 1,720, FBMKLCI is estimated to be valued at 17.4x and 15.3x against its FY11 and FY12 consensus earnings estimates. However, do note that this index target level is on a trailing 12‐month basis. Should we prorate this 12‐ month trailing target, FBMKLCI is expected to trade at 1,640 by end‐2011. • As for our investment strategy, we prefer to go back to the basic – buying/accumulating into dips and focusing into blue chips.

• On sectorial front, (i) water and multi‐utilities, (ii) technology (especially the E&E sub‐sector), (iii) construction, (iv) healthcare products and services, (v) basic materials (including cement, steel, pipe) and (vi) gloves were the underperformed sectors as their actual/annualized earnings were 74.4%, 61.9%, 30.7%, 28.4%, 27.7% and 27.1% below than consensus estimates (see Figure 3).

• Note that, as we have adopted a conservative stance, therefore, 1QCY11 results were largely within our expectations. Besides, it is also worthwhile to note that the water and multi‐utilities sector was dragged down by the adoption of new accounting standard by MMC Corporation (“MMC”, MARKET PERFORM, RM2.76) and Puncak Niaga (“PUNCAK”, BUY, RM3.84). The summary of the results and the full‐list of result numbers (see Figure 7‐10) are shown in the following sections.

• The uncertainties over the timing of General Election and overseas equity market as well as the threats of inflation and interest hike could be major downside risk factors to the market.


Source/转贴/Extract/:KENANGA INVESTMENT
Publish date:02/06/11

Market Strategy : 1Q11 results round-up (ECM)

Market Strategy
FBMKLCI : 1,556.42
End 2011 FBMKLCI target: 1,650

1Q11 results round-up
1QCY11 results saw more negative surprises (24% from 18% in 4QCY10) but at the same time, a lot also came in within expectations (58%). Earnings revision slowed to 1.4x given less need for upgrades to estimates. On fund flows, there was a recovery in April but mostly to North Asia. Malaysia nonetheless had some spillover effect and we continue to be positive of the fund flow into Malaysia as foreign investors’ interest may be stoked by news flow on economic transformation, new listings as well as M&A activities. We maintain our end-2011 FBMKLCI target of 1,650.

1QCY11 held more negative surprises
_ 1QCY11 results were largely within both ECM and market expectations. 58% of stocks under coverage (49% based on consensus estimates) reported results which were within estimates

_ Positive earnings surprises made up 18% of stocks under coverage which was lower than the 25% positive earnings surprises in the 4QCY10 reporting season. Negative earnings surprises however, have increased this quarter with 24% of stocks under coverage failing to meet estimates as compared to 18% in the preceding quarter.

That said, number of downgrades declined
_ Number of earnings downgrades has declined from 11 in 4QCY10 to 8 in 1QCY11. Upgrades also declined hence the earnings revision ratio (number of upgrades divided by downgrades) slowed at 1.4x versus 1.6x in the preceding quarter.

Fund flow analysis
_ After a tumultuous 1Q, foreign equity flowed into emerging markets again with USD10.8bn net inflow in April. While most of the inflows went to North Asia given its attractive valuation, ASEAN benefited from the spillover effect with a net inflow of USD1.1bn in Apr. Thailand (+USD381.8m), Indonesia (+USD277.1m) and Malaysia (+USD201.3m) were the top three destinations of foreign investors in the ASEAN region. Despite this, regional equity markets continued to be volatile as investors remain concern with high inflationary pressure in the region as well as contagion effect of Eurozone sovereign debt crisis. Going forward, we are still positive of the fund flow into Malaysia as foreign investors’ interest may be stoked by news flow on economic transformation, new listings as well as M&A activities.

Maintain end-2011 FBMKLCI target at 1,650
_ Taking into account our view that fundamentals of Malaysian equities is intact but external uncertainties has derailed momentum in the near term, we maintain our end-2011 FBMKLCI target of 1,650 (15x mid-cycle P/E) which is premised on expected CY11 and CY12 earnings growth of 10.3% and 14.3% respectively.

_ FBMKLCI is likely to be range bound in the near term.

_ Investors’ interest has switched from big-cap stocks to small/mid-cap stocks due to widening valuation gap.

Still overweight on O&G, consumer and media
_ We maintain our existing overweight calls on consumer, media, and oil & gas sectors. The latter is still the clear cut winner as more laggards start to see positive news flow in the months ahead.

_ Our top picks are (1) Axiata (2) AirAsia (3) Parkson (4) SapuraCrest (5) Wah Seong (6) Sunway Holdings (7) Alam Maritm and (8) Axis Reit.

FUND FLOW ANALYSIS
Foreign equity flows into emerging market again
After a tumultuous 1Q, foreign equity flowed into the emerging market again with USD10.8bn net inflow in April. While most of the inflows went to North Asia given its attractive valuation, ASEAN benefited from the spillover effect with a net inflow of USD1.1bn in Apr. Thailand (+USD381.8m), Indonesia (+USD277.1m) and Malaysia (+USD201.3m) were the top three destinations of foreign investors in the ASEAN region. Despite this, regional equity markets continued to be volatile as investors remain concerned with high inflationary pressure in the region as well as the contagion effect of Eurozone sovereign debt crisis. Going forward, we are positive of the fund flow into Malaysia as foreign investors’ interest may be stoked by news flow on economic transformation, new listings as well as M&A activities.

In terms of country allocation, Malaysia continued to gain traction. Asia ex-Japan fund allocation to Malaysia has increased from 3.19% in Mar to 3.24% in Apr.







Maintain end-2011 FBMKLCI target of 1,650
Taking into account our view that fundamentals of Malaysian equities is intact but external uncertainties has derailed momentum in the near term, we maintain our end-2011 FBMKLCI target of 1,650 which is premised on expected CY11 and CY12 earnings growth of 10.3% and 14.3% respectively and mid-cycle P/E valuation of 15x.

Departing from our previous view of a possible extension of a liquidity driven rally, we are now ruling out such a possibility due to potentially muted foreign investors’ net inflow going forward.

The benchmark index is likely to be range bound in the near term, as it digests positive news flow on the domestic front (financial sector liberalisation, ETP implementation, general election etc) and potentially negative news flow on the external front (Eurozone sovereign debt crisis, escalation of the MENA crisis, early withdrawal of QE2 etc).

We maintain our existing Overweight calls on consumer, media, and oil & gas sectors. The latter is still the clear cut winner as more laggards start to see positive news flow in the months ahead. Our top picks are (1) Axiata (2) AirAsia (3) Parkson (4) SapuraCrest (5) Wah Seong (6) Sunway Holdings (7) Alam Maritm and (8) Axis Reit.





Source/转贴/Extract/: ECM Libra Capital
Publish date:02/06/11

US dollar cracking at the seams

The Star Online > Business
Saturday June 4, 2011

US dollar cracking at the seams

WHAT ARE WE TO DO
By TAN SRI LIN SEE-YAN

MY last columns dealt with the international monetary system (IMS), specifically why the world monetary order is in disorder, and why free movement of capital underpinning the IMS is increasingly being challenged. Today's column concerns the basic anchor of the IMS the reserve currency role of the US dollar and why it will give way to rapidly rising pressures towards multipolarity, that is, the concurrent pulling of forces emanating from more than two growth centres.

In 20 years, the World Bank expects the newly emerging BRIIKs (Brazil, Russia, India, Indonesia and Korea) to join China as new drivers of growth towards a multipolar world. Today, none of their currencies is used for reserve accumulation, invoicing or exchange rate anchor. The status quo remains centred on the US dollar. But change is in the air. In 1991, the G3 (US, euro-zone and Japan) accounted for 49% of world trade, and the BRIICKs (BRIIKs plus China) only 9%. By 2010, the G3's share had fallen to 29%, while the BRIICKs' share rose beyond 30%. Without doubt, the post-war structure dominated by advanced nations is in the midst of fundamental change. Globalisation and the rapid growth of the emerging market economies (EMEs) are bound to translate into greater global economic power. It's just a matter of time.

Multipolarity

We are witnessing the cracking of the global institutions created in 1945. They are still unadjusted to the growing weight of the EMEs, reflecting reluctance by the United States and euro-zone to come to terms with a world they no longer dominate. It is also a manifestation of uneasiness in China, India and Brazil that the management of their domestic economy, long the jurisdiction of internal prerogative, now matters to the rest of the world.

This is understandable. The founding of the Bretton Woods institutions (IMF and World Bank) after the devastation of the Great Depression and WWII set in motion an era of stability at a time when the US was unchallenged in the global economy. In international finance, this post-war order began to fall apart in the 1970s as the US economy floundered, the dollar tanked, Europe was rebuilt and Japan asserted itself.

The move towards multipolarism was, however, interrupted in the 1980s and 1990s by the Soviet Union's collapse, the euro-zone's indigestion after swallowing a re-united Germany, and the Asian currency crisis. The US was thrust into the forefront to lead. But, the home-made US financial crisis in the 2000s in the face of rapidly rising EMEs, brought the era of US dominance to an end.

Yet, neither the US, euro-zone nor China has the capacity and clout to manage global problems. Happily, the G-20 came along to replace the G7, stumbling on to a mutually beneficial co-operation. Prof Barry Eichengreen's reference in history of another scenario is scary: “The decades following WWI were marked by the inability of rising or declining powers to stabilise the world economy or create functioning global institutions; the result was the Great Depression & WWII.”

A definite shift is taking place, driven by the rising power of the emerging BRIICKs, together representing more than one-half of global growth in 14 years. According to the World Bank report, Multipolarity: The New Global Economy, the EMEs will grow at 4.7% per annum up until 2025, which is double the rate of the advanced nations (2.3%). The implications are far-reaching:

the balance of global growth and investment will shift to the EMEs;

this shift will lead to boosts in investment flows to nations driving global growth, with a significant rise in cross-border M&As, and a changing corporate landscape where established multinationals will largely be absent;

a new IMS will gradually evolve, displacing the US$ as the world's main reserve currency by 2025;

the euro and the RMB (renmimbi, China's currency) will establish themselves on an equal footing in a new “multi-currency” monetary system;

the euro is the most credible rival to the US$; “its status is poised to expand provided the euro can successfully overcome sovereign debt crisis currently faced by some member countries and can avoid moral hazard problems associated with bailouts within the European Union;”

the rising role (and internationalising) of the RMB should “resolve the disparity between China's growing economic strength on the global stage and its heavy reliance on foreign currencies;” and

the transition will happen gradually.

At no time in modern history have so many EMEs been at the forefront of an evolving multipolar economic system.

A strong US dollar a delusion

The US dollar is the reserve currency. This refers to its use by foreign central banks and governments as part of their international reserves. This role, combined with its widespread use as a medium of exchange (transactions and settlement vehicle), a standard of measurement (unit of account) and a store of value (method of holding wealth), has given rise to the key currency status of the US dollar. For these reasons, the US serves as world banker.

This was not planned. It just evolved since it met various needs of foreign official institutions and foreign private parties more effectively than any alternative could. Many of the reasons for the use of US dollar by official and private parties are the same. However, the aims of the two users need not always coincide. If the US dollar's role as reserve currency was terminated, its use by private traders and institutions would most likely remain, perhaps even stronger. The wheels of commerce keep turning. The role of the US dollar as world banker remains relevant.

It is a long-standing tradition for the US Treasury to favour a strong US dollar. The US Fed has no say since it is outside its purview of fighting inflation and unemployment.

The exchange rate is just another price. The price of the US dollar relative to other currencies is determined in the market, and not under the control of anyone. An increase in demand for US dollar or a reduction in its supply strengthens the US dollar. Lower demand and increased supply will weaken the US dollar.

A strong US dollar is not always good. It depends on what causes it to strengthen; if the cause is rising productivity or innovation, that's good. But in an economy struggling to grow and to create more jobs, a strong US dollar is not so desirable. A weak dollar means goods are cheaper relative to foreign goods; it stimulates exports and reduces imports. Foreign goods get more expansive but more US jobs are created.

At this time, US is better off with a weak dollar. Strangely, most politicians thinks it's desirable for the US dollar to weaken only against one currency, the renminbi. The US Congress routinely bashes China for not weakening the US dollar enough. Indeed, a fall in the value of the US dollar against all currencies would help the US even more. Yet, in the next breath, the same Congress wants the US dollar to be strong. This delusion just won't go away. They are like failed dieters who talk earnestly about healthy living while eating a chocolate doughnut.

The US dollar isn't going anywhere. It is not about to be replaced anytime soon. The only dangers are (i) reckless US mismanagement giving rise to chronic inflation (or deflation if the exit of QE2, the second round of quantitative easing, is not well handled), which is implausible; and (ii) US budget deficits run out of control; outright debt default is far-fetched. Mark Twain once responded to accounts of his ill health by saying “reports of my death are greatly exaggerated”. He might well have referred to the US dollar. For the moment, the patient is stable, external symptoms notwithstanding. But there will be grounds for worry if he doesn't commit to a healthier lifestyle.

The euro and renminbi

Today, the US dollar faces growing competition in the global currency space. The serious contender is the euro, which has gained ground as a currency goods are invoiced and as official reserves held. Nevertheless, share of reserves held in US dollar remains well over double the share held in euros; US$ share did fall from 71% in 2000 to 67% in 2005 and 62% in 2009, while euro's share rose from 24% in 2005 to more than 27% in 2009. In terms of global forex, the US$ market turns over US$3.5 trillion daily, more than double that in euros. But the US dollar share of the market fell from 45% in 2001 to 42% in 2010. Euro capital markets are of comparable depth and liquidity as the US dollar's, and the euro-zone and US economies are roughly the same size.

Events since 2008 have shaken faith in the US financial markets. But the banking crisis and its economic fallout are a trans-Atlantic affair. Continuing euro bailouts is a sign the old continent is not much safer than the US. Worried savers may still sleep better with US$ under their pillow. So for the euro, it's going to be a long haul.

The sheer dynamism of China and the globalisation of its corporations and banks will propel the renminbi to a greater international role. It can become a global settlement currency this year. China has made good progress, signing currency swaps with more central banks. The issuance of renminbi-denominated bonds is actively promoted. Renminbi offshore deposits in Hong Kong (to top 1 trillion renminbi by year-end) are rising rapidly, and offshore renminbi trading will expand beyond Hong Kong.

But with the undervalued exchange rate, an asymmetry in settlement has arisen. Foreign importers are reluctant to settle in renminbi, while foreign exporters are glad to do so. In the end, success at internationalising the renminbi depends on the pace China liberalises the capital account.

The problem lies in speculative capital flows aimed at profiting from arbitrage. Capital controls remain as China's last line of defence against hot' money inflows. Its policy continues to encourage non-residents to hold more renminbi and renminbi-denominated assets. The sequencing of policy adjustments remains critical as China moves forward. The road ahead is going to be bumpy.

Policies co-ordination

By 2025, the World Bank's best bet is the emergence of a multipolar world centered around the US dollar, euro and renminbi. A world supported by the likelihood US, euro-zone & China will constitute the three major “growth poles” by then. They would provide stimulus to other nations through expanding trade, finance and technology transfers, which in turn creates international demand for their currencies. Already, private investment inflows into EMEs are expected at US$1.04 trillion this year (mainly to China) against US$990bil in 2010 and US$640bil in 2009.

Inherent in this shift is rising competition among them, which is real. This is bound to create situations of potential conflict, which can exact a heavy toll on global financial markets and growth. This calls for workable mechanisms to strengthen policy co-ordination across the major growth poles in particular. This is critical in reducing risks of political and economic instability.

In the recent crisis, the G-20 was able to pick low-hanging fruits by managing the re-alignment of macro-economic policies aimed at generally common objectives to get out of recession and to rebuild financial systems. In today's world, shifts in policy co-ordination will be increasingly towards more politically sensitive domestic fiscal and monetary and exchange rate policies. Also, the interests of the least developed countries (LDCs) have to be safeguarded against pressures accompanying the transition to a multipolar order.

Against the backdrop of the tragic earthquakes and tsunami that hit Japan, the political turmoil of the Arab spring' gripping much of Middle East and North Africa (MENA), and growing uncertainties emanating from euro-zone sovereign debt crisis, global growth remains at sub-par this year with high unemployment, and rising inflation in the EMEs and LDCs. This calls for building confidence and promoting investments to boost productivity and create jobs to absorb the large pool of youth in MENA in particular. The LDCs and MENA nations are heavily dependent on external demand for growth. Aid and technical assistance have the ability to cushion adjustments as they adapt in the transition process.

According to the World Bank: “It is also critical that major developed economies and EMEs simultaneously craft policies that are mindful of the growing interdependency associated with the increasing presence of developing economies on the global stage and leverage such interdependency to derive closer international cooperation and prosperity worldwide.”

A former banker, Dr Lin is a Harvard-educated economist and a British Chartered Scientist who now spends time writing, teaching and promoting the public interest. Feedback is most welcome at starbiz@thestar.com.my

Source/转贴/Extract/: The Star Online
Publish date:04/06/11

科斯托蘭尼-雞蛋理論




Source/转贴/Extract/: youtube
Publish date:11/12/10

Jim Rogers - BBC Hard Talk Interview





Source/转贴/Extract/: youtube
Publish date:02/06/11

Jim Rogers - China Isn't Communist (May 11, 2011)



Source/转贴/Extract/: youtube
Publish date:11/05/11

Jim Rogers - Why Is George Soros Selling Gold and Silver? (CNBC May 11, 2011)

Jim Rogers - Why Is George Soros Selling Gold and Silver? (CNBC May 11, 2011)


George Soros has recently announced that he is getting out of gold and silver. Hopefully it goes down for a while. Ideally, they will continue to go up gradually with normal corrections. But if anything turns into a parabolic move, you have to sell.


Jim Rogers - Time to Face Reality (CNBC May 11, 2011)


You should own the Euro, nor should you think about selling it for fundamental reasons. The European central bank has done a much better job than the American central bank. If the Europeans were running the American central bank, the world would be in much better shape.



Source/转贴/Extract/: youtube
Publish date:11/05/11

Battling the inflation monster

by Steve Brice
04:46 AM Jun 04, 2011

Investing is tricky enough in normal times but periods of heightened uncertainty surrounding inflation outcomes make it even tougher. We forecast Singapore inflation to average 4.2 per cent this year and slow down to 2.5 per cent next year and in 2013.

We are in a situation where investors need to invest in different asset classes, not to grow wealth but just to maintain its current value.

The policy of managing the Singapore dollar against a basket of currencies to control inflation means that interest rates are largely determined by international interest rates.

While Europe has started tightening monetary policy, the reality is that neither United States nor European rates are likely to rise dramatically in the coming 24 months.

Therefore, Singapore interest rates in real terms are likely to remain negative through the next year and we expect money in the bank to lose purchasing power - which has happening for some time - over the coming 24 months



Go easy on bonds?

One alternative to investors would normally be extending the tenor of investments, assuming that they have the appetite to invest over the longer term, by investing in bond markets.

However, the environment for global bonds is not positive and we expect meagre returns over the next 12 months, given high or rising inflation and deteriorating fiscal dynamics, especially in the West.

Singapore bonds are unlikely to significantly outperform their global counterparts as we expect the interest paid to be largely offset by capital losses as yields rise.



Consider equities - look at dividend yield, watch for risks to PER and earnings growth

Until recently, the good news has been that a relatively small allocation to global equity markets would have offset the inflation erosion from investing in cash instruments.

The MSCI World index rose 31 per cent in 2009 and then over 10 per cent last year. In the first quarter of this year, the return has been almost 4 per cent (over 16 per cent on an annualised basis). This performance was remarkable given the backdrop of much higher oil prices, due to the political crises in the Middle East, the earthquake, tsunami and radiation leak in Japan, the sovereign debt issue in Europe and increasing signs that the Asia rate hiking cycle may be more severe than expected.

Given the low returns expected in other major asset classes (cash and bonds), we remain overweight on global equities on a 12-month time horizon. However, the outsized returns we have seen over the past 27 months are unlikely to be replicated going forward.

There are three key drivers to equity market performance: The dividend yield, earnings growth and the price-earnings ratio (PER, the price the market is willing to pay for earnings). We see little reason to forecast a significant re-rating of equity markets via a higher PER in the coming months, as the risk of higher oil prices remains. Our analysis suggests if oil prices rise to around US$150 per barrel on a sustained basis, it would significantly undermine global growth, reducing the attractiveness of global equities.

Therefore, we are likely to have to rely on the other two factors to generate the majority of returns. The MSCI World index dividend yield is 2.4 per cent currently, while consensus earnings growth is around 14 per cent on average over the next two years, according to I/B/E/S data.

However, earnings growth could disappoint as companies take the hit, at least initially, from higher food and oil prices. Therefore, we estimate that equities are likely to generate more normal high single-/low double-digit returns over the next 12 months.

With cash and bond returns being abnormally low, we believe this still warrants a small overweight for global equities on a 12-month basis. For those willing to ride out short-term volatility generated by the tightening cycle, we expect Asia ex-Japan equities to outperform over a 12-month time horizon.

A continued global economic recovery remains our central scenario and this is positive for Singapore companies. However, Singapore is one of the countries most exposed to potential supply chain issues after the earthquake and tsunami in Japan. Therefore, the earnings of some companies in the first half of the year may be adversely affected, but this will be short-term.



Steve Brice is chief investment strategist, group wealth management, at Standard Chartered Bank.


Source/转贴/Extract/: TODAYonline
Publish date:04/06/11

Friday, June 3, 2011

穆迪或下調美銀花旗評級

(紐約3日訊)穆迪投資者服務公司眼下正在評估美國政府,是否將限制對大型金融機構的支持,評估結果可能導致美國銀行、花旗集團和富國銀行的債信評級被下調。


穆迪目前將美國銀行、花旗集團、富國銀行以及它們子公司的存款評級、優先債券評級和優先次級債評級至於觀察名單,可能下調。

穆迪在一份公告中表示,自金融危機以來,該機構認為,如果這些銀行再次陷入困境,美國政府將向它們提供額外的支持,這種假設對這些銀行的評級構成支撐。穆迪此番評估,將集中在這些銀行的評級是否應該被調整,以消除這種不尋常因素帶來的提振,只把相當於危機發生前的政府支持力度納入考慮範圍。

這些大型銀行2008年獲得政府救助以防止金融系統崩潰,自此投資者一直認為它們是大到不能倒的機構。為了避免重蹈覆轍,美國國會議員自那之後改革監管體制,通過了多德‧弗蘭克法案。其中,美國銀行危機時獲得了450億美元的政府救助。


Source/转贴/Extract/: 東方新聞
Publish date:04/06/11

Starhill Global REIT Attractive yields for well-heeled retail malls (CIMB)

Starhill Global REIT
OUTPERFORM
S$0.64 @02/06/11
Target: S$0.74
Attractive yields for well-heeled retail malls

• Attractive yields for well-heeled retail malls; initiate with Outperform. Starhill’s portfolio is dominated by high-end retail properties located in prime shopping districts in Singapore, Malaysia, China, Australia and Japan. We use DDM (discount rate 8.4%) to value Starhill and arrive at a target price of S$0.74. We believe its welllocated assets, master leases and low asset leverage offer income stability. FY11 DPU yield of 6.7% is also the highest among retail REITs under our coverage. We
see catalysts from higher rental revisions, asset-enhancement initiatives and accretive acquisitions.

• Master leases for income stability. While exposure to discretionary spending (in high-end retail malls) typically increases volatility, we expect master and long leases, which anchor about 44% of our FY11 revenue forecast, to mitigate these volatilities. Master and long leases on its overseas assets, likewise provide income stability as the REIT ventures overseas for growth.

• Growth catalysts. Its Toshin and David Jones master leases will be up for reviews in FY11. With both properties substantially under-rented, we see room for upward rental revisions. Management has also announced asset-enhancement plans for Wisma Atria, which should drive rental growth on completion. Meanwhile, low asset leverage at 30% leaves room for acquisitions without the need for substantial equity fund-raising.

Background
Global mid-to-high-end retail exposure. Sponsored by YTL Corporation Berhad, Starhill is a Singapore-based real estate investment trust (REIT) investing primarily in prime retail properties in the region. It had a portfolio of 13 properties across Singapore, Malaysia, China, Australia and Japan, totalling S$2.6bn, as at Dec 10. Starhill has a global investment mandate and targets mid-to-high-end retail assets located in top-tier shopping stretches in any city. Its properties can be found in prime shopping stretches including Orchard Road in Singapore, Bukit Bintang in Kuala Lumpur, Malaysia, Hay Street in Perth, Australia, Minato-Ku and Shibuya-Ku in Tokyo, Japan and Renmin South Road in Chengdu, China.

New sponsor in 2008. First listed on the Singapore Exchange as Prime REIT in Sep 05, the REIT was renamed Macquarie MEAG Prime REIT, then Macquarie Prime REIT before YTL acquired the REIT manager in 2008 and renamed it Starhill Global REIT. Both the REIT manager and property manager of Starhill’s Singapore assets (YTL Starhill Global REIT Management Limited and YTL Starhill Global Property Management Pte) are subsidiaries of the sponsor. The rest of the portfolio is managed externally by local managers.

Focus on retail. Starhill is predominantly retail-focused, with its office component accounting only about 12% of net property income (NPI) in 1Q11. This comes mainly from office space in Wisma Atria and Ngee Ann City. Management intends to focus on retail assets in the long term.

Singapore to remain core market with 59% contribution in 2011. The 13 assets in Starhill’s portfolio are Wisma Atria (74% stake) and Ngee Ann City (27% stake) in Singapore; Renhe Spring Zongbei in Chengdu, China; seven properties in Tokyo, Japan; David Jones Building in Perth, Australia; Starhill Gallery and Lot 10 in Malaysia. Singapore remains a core market for Starhill, accounting for 69% of its portfolio asset value and 59% of NPI as at 1Q11. Malaysia is its second largest market, accounting for 16% of its asset value and 20% of NPI as at 1Q11.

Master and long leases with rental reviews/step-ups. Typically, high-end retail malls have large discretionary or luxury spending content, and a heavier reliance on tourist spending than suburban counterparts. Hence, we deduce greater uncertainties in the leasing of prime retail space. However, the volatility is, in part, mitigated by master leases and long leases in Starhill’s portfolio, accounting for 44% of our 2011 projected revenue. These leases consist of the:

1) Toshin master lease in Ngee Ann City: Toshin is a wholly-owned subsidiary of Takashimaya Company, which operates the Takashimaya Department Store in Ngee Ann City. The area under Toshin’s master lease is 225,969sf, or 57% of NLA (of Starhill’s stake of Ngee Ann City), and is allowed for subletting. The sublease tenants (managed directly by Toshin) are largely luxury and high-end retailers including Louis Vuitton, Chanel, and Burberry’s. The master lease area comprises retail space in Basements 1 and 2, Levels 1 through 4 (not including Takashimaya Department Store, which is owned by Ngee Ann Kongsi). The master lease will expire in Jun 13, with an option for renewal for 12 years, and is subject to an upward-only market rent review every three years, and a 25% cap on rental increases. The next market review will be in Jun 11. We project a 10% rental increase, with contributions from the Toshin master lease forming 21% of our forecast revenue for 2011, up from 20% in 4Q10.

2) YTL master lease in Starhill Gallery and Lot 10. Starhill Gallery and Lot 10 are master-leased to YTL’s indirectly wholly-owned subsidiary, Katagreen Development Sdn Bhd. YTL guarantees the master tenant’s payment obligations under the master tenancy agreements. The lease area for both buildings is 554,824sf (Starhill Gallery at 298,013sf; and Lot 10 at 256,811sf) or 100% of the NLA of both buildings. The lease term is 3+3 years (with an option for renewal for the last three years) at pre determined annual rents of RM72.1m (S$30.9m) for the first three years, RM77.3m (S$33.1m) for the second; and RM82.4m (S$35.3m) for the third term. The above represents an annualised increase of 1.6% p.a. While this might be lower than what the underlying property could have achieved, we see positives in the stability offered by the master lease. Contribution forms 17% of our 2011 forecast revenue for the REIT.

3) David Jones long lease in David Jones Building. David Jones is a popular department store in Australia, arguably the oldest continuously operating department store in the world still trading under its original name. Area leased is 246,528sf, or 95% of the GLA of the building. The lease to David Jones has 22 years left before expiring in 2032. A rent review every three years has been incorporated, and the first review is in Aug 11. We project a rental increase of 6% then and estimate that the David Jones master lease will contribute 6% of our 2011 forecast revenue.

Benefiting from the sponsor. Starhill is sponsored by YTL, which owns an aggregate 29.4% stake in the REIT. YTL is one of the largest companies listed on the Bursa Malaysia (market cap of RM36.4bn or US$12.0bn as at end-May 11), involved in various businesses including utilities, construction, property development and hospitality. We anticipate that YTL’s strong ties with major global retailers such as Moet Hennessy, Louis Vuitton and the Swatch Group would aid Starhill in securing tenants appropriate for its luxe positioning. Separately, we anticipate that YTL’s expertise in property development and construction could, in the longer term, possibly incubate development projects for the REIT, that may include the defunct hotel component of the David Jones Building in Perth, Australia. In terms of acquisition pipeline, we understand that the sponsor has no more retail assets that could be injected into the REIT.

Market outlook
Singapore
Long-term positive outlook for Singapore retail. We believe underlying support of the retail sector from both domestic and foreign visitors remains strong in the near- to medium-term. The Singapore government’s population growth target of 6.5m (from a current population of 5m) is intact. Additionally, increased attractions for tourists at the two integrated resorts, the rejuvenation of Orchard Road, long-term plans to link Singapore and Johor by rail and road networks among others should result in increased visitor arrivals which are positive for the retail sector, particularly for welllocated malls along Orchard Road, a key destination for tourists.

Orchard retail rents to remain soft in short term, but well-located mature malls should fare better. Despite a positive longer-term outlook, retail rents have, however, fallen almost 20% from their peak in 2Q08 due to a combination of weaker retail sales in 2009 and an influx of new retail malls in 2009. Some 1.1m sf of retail space was added to Orchard Road over 2009, bumping up Orchard Road’s retail space by 24%. As new malls typically need at least one leasing period (usually three years) for gestation, occupancy and rents at Orchard malls could soften in the short term with some musical chairs among the new malls and existing malls. The impact should, nevertheless, be alleviated by continued take-up of space in the newer retail malls and the arrival of newto- market brands attracted to top spots along the prime shopping district. Wheelock’s Scotts Square (with NLA of 71,200 sf), due to be completed in 4Q11, is the only scheduled completion for the rest of 2011. In 1Q11, rentals along prime Orchard Road softened 0.5% qoq and 7.1% yoy to S$29.90 psf, according to CB Richard Ellis, though this was a slight improvement over the 2.6% qoq decline in 4Q10.

Rise in office rents to mitigate negative reversions. Driven by positive take-up with a pick-up in the economy and the job market, office rents bottomed out in 1Q10. Though there should still be some negative rental reversions for Starhill’s office portfolio in FY11, we expect improving rents to alleviate the impact. Furthermore, unlike CBD offices, office rents in the Orchard Road micro-market are generally more stable, with peak rents (in 2007-08) lower at S$12-14 psf vs. their Raffles Place counterparts. With limited office supply in the Orchard area and niche demand from tenants in the retail and medical industries, management expects occupancy to hold up and asking rents to trend up to S$9-10 psf. With its occupancy firming up to 90% or more for both office towers, management intends to hold out for better rentals.

Malaysia
Retail sales backed by domestic demand. We see bright prospects for the retail market in Malaysia. Backed by strong underlying domestic demand and private consumption expenditure, retail sales had been growing yoy for the past five years prior to 2009 before contracting in early 2009 due to the global financial crisis. A recovery since 3Q09 had allowed 1% yoy growth in 2009 overall. Retail sales, meanwhile, expanded 8% in 2010, boosted by government policies to support consumer spending and a continued recovery in consumer sentiment. While growth is expected to moderate in 2011, partly with a reduction in government subsidies, independent research firm Retail Group Malaysia still anticipates 6% growth this year, backed by positive structural drivers including low unemployment, a young and growing population with the propensity to spend, rising urbanisation and rising household income.

Positive retail rental outlook. Kuala Lumpur is the capital city and the largest in Malaysia by population. Bukit Bintang is a key shopping belt with the highest concentration of malls in Kuala Lumpur. The retail scene in Malaysia is relatively fragmented in terms of ownership, with malls typically owned individually by separate corporate entities. Few malls are held as a portfolio by REITs and few companies have more than one mall in their portfolios. Within Kuala Lumpur, such players typically own the larger malls and include IGB Corporation Berhad, Pavilion International Ltd and Starhill. Driven by positive retail sales, rents for prime retail space in Kuala Lumpur had steadily risen from 2001 before a pullback in late 2008 due to the crisis. Rentals resumed their climb in late 2009, in tandem with the recovery in retail sales, though the pace has since moderated, with net rents hovering in the range of S$27 psf pm, according to Jones Lang Research. In 1Q11, Suria KLCC – Ramlee Extension (141k sf) was the only completion in the city centre with supply muted for the rest of 2011. With limited supply and a positive retail sales outlook, we expect stable to rising rents for prime retail space in Kuala Lumpur, with rental increases commanded by well-located prime shopping centres with good positioning.

Australia (Perth)
Retail rents could remain flat in 2011. Perth is the capital of resource-rich Western Australia. Hit by the 2008 downturn, retail sales in Western Australia had slumped in late 2008 and remained weak in 2009. The Western Australian economy, however, regained its footing in 2010 as a rebound in commodity prices renewed demand for Australia’s mineral exports. This, coupled with a reduction in the unemployment rate and a pick-up in consumer confidence, took retail turnover in 2010 higher despite a post-stimulus lull, growing 2.5% yoy in 2010 after a 3.2% increase in 2009. We believe that a sustained environment of low unemployment rates and rising disposable income would fuel some improvements in retail sales this year, though the threat of further interest-rate hikes and weak discretionary spending could remain overhangs. Retail rents in Perth had been stable since the start of 1Q09, with super-prime rents (CBD) and prime rents at indicative levels of A$3,788psm and A$3,042 psm respectively, according to CB Richard Ellis. With the retail environment remaining rather subdued, we expect retail rents to stay flat in 1H11 before nudging higher towards the end of the year.

China (Chengdu)
Positive outlook; but supply could cap rental growth. Chengdu is the commerce and trade centre of Sichuan province in China and boasts one of the busiest shopping districts in south-west China. Backed by strong economic growth and rising disposable incomes, retail sales have been growing strongly in the past few years, even in the midst of the global financial crisis. This growth has, however, attracted retail investments from various developers, resulting in an influx of retail-space supply and putting a check on increases in average rentals. More retail-space supply is in fact expected in 2011 with the completion of malls like Suning Plaza, Wangfujing Shopping Centre and Raffles City. As such, while demand could potentially keep up with supply in view of the strong retail sales and demand for space from international labels keen to penetrate the market, we expect upcoming supply to cap major rental increases.

Japan (Tokyo)
Less positive retail outlook. Plagued by the global financial crisis, Japan’s economy had shrunk 6% in 2009 while its unemployment rate had risen 1%. The economy rebounded in 1Q10, with rising consumer confidence and consumption setting the stage for a bottoming-out in retail rents. This recovery was, however, short-circuited by one of the worst earthquakes in Japan’s history in Mar 11. Coupled with a potential nuclear crisis, this is expected to hurt consumer spending and tourist arrivals in the near term. Looking beyond the earthquake, a shrinking workforce, ageing population, rising public debt and persistent deflation do not augur well for the Japanese economy, potentially keeping growth in the slow lane. Compounded by the costs of relief and reconstruction after the earthquake, consumption taxes could rise, slowing wage growth and weakening consumer sentiment. We are thus less positive on the retail scene in Japan and have projected flat rents for its Japanese portfolio.

Growth catalysts
Room for upward rental revisions for Toshin lease. As at 1Q11, we estimate Toshin’s monthly rent at S$13.15 psf (GLA) on average. This is below our estimated rents (NLA) of S$30-31 psf on average for Wisma Atria and S$15-16 psf for Ngee Ann City Level 5 (owned and managed by Starhill), which is less prime than the Toshin area. We thus expect some rental revision for the Toshin lease during its Jun 11 review, though rents on a GLA basis should still be below the average in Wisma Atria given its large tenant format and inclusion of common corridor space. Due to a slight disagreement between Starhill and Toshin on rental increases, Starhill recently applied by way of originating summons for the court to review its rental review mechanism on the Toshin lease. Should new rents not be determined before the commencement of the next term, current rents would continue to apply for the next term until new rents are determined. The new rents will also be applied retrospectively as soon as they have been determined. Given the much lower rentals on the Toshin lease vis-à-vis nearby buildings, we expect Starhill to be successful in negotiating for a rental increase and estimate a 10% rental increase in the Jun 11 review.

The Toshin master lease will expire in Jun 13, with an option for renewal for 12 years. While there are risks of non-renewal, we believe there could be upside should Starhill take over direct lease management. With rentals still much below market rates, even if rentals are raised by a maximum of 25% in Jun 11, we expect Starhill to be in pole position to negotiate for a further rental increase in Jun 13.

Asset-enhancement initiatives for Wisma Atria. Management has announced assetenhancement plans to rejuvenate the frontage of Wisma Atria. This will feature doublestorey store fronts to leverage Wisma Atria’s long street level along Orchard Road and showcase flagship stores for international retailers. The asset enhancement will also feature full-width steps to improve accessibility and provide permanent flood control. Capex will be funded by proceeds from its rights issue in 2009. With likely higher rentals from tenants occupying the new duplexes and a slight NLA increase, management guides for a positive ROI of 8% on the AEI though we believe there could be upside through higher rentals from other tenants if the AEI succeeds in improving footfall at the mall.

Potential for higher NLA in David Jones Building. The 4-level David Jones Building is a heritage-listed building constructed around 1910 that was formerly the Savoy Hotel. The hotel is vacant except for ground-floor units. The manager is exploring the potential of converting the hotel into additional tenantable space within heritage guidelines. If successful, the asset-enhancement plan could provide upside in the future.

Acquisition growth. Management is moderately ambitious in expanding its asset base. It hopes to double assets under management in 5-7 years’ time with a view on prime and retail properties with the potential of supporting a mid-to-high-end tenant mix. Starhill holds the first right of refusal to Renhe Spring’s assets in China. In addition, while
management is keen to develop its existing markets (Singapore, Malaysia, Australia, China, and Japan), it is exploring new markets such as London for potential entry at opportune times. With asset leverage of 30%, we believe it will not be difficult for Starhill to make accretive acquisitions on a leveraged basis. Barring major acquisitions, we expect these acquisitions to take the form of master/long leases for increased income stability and to reduce the cost of running a dedicated local management team.

Rationalisation of portfolio. In view of its limited presence and thus lack of scale in Tokyo, we believe management could be open to divesting its Japanese retail assets in the medium term.

Risks
Potential dilution from convertible preferred units (CPUs). The acquisition of Malaysian assets had been funded partially by junior medium-term notes, which were in turn partially funded by S$173m worth of CPUs. The CPUs can be converted into units after three years i.e. from 2013, with any unconverted CPUs converted in the seventh year i.e. 2017. The conversion price has been set at S$0.7266. Upon full conversion, the unit base will increase by 238.1m units, representing a dilution of 12%.

Concentration risks in Toshin. There are considerable concentration risks in the portfolio with the Toshin master lease contributing 21% of our estimated revenue forecast for 2011. As Toshin fully manages the retail space which forms the bulk of the retail area in Ngee Ann City, the success of the mall both in terms of positioning and choice of subtenants can be largely attributed to Toshin. The first term of the lease is due to expire in 2013, and if Toshin chooses not to renew for a second term, management may not be able to retain or attract sufficient similar-quality tenants to fill the vacancy. Nonetheless, given the prime location and established status of Ngee Ann City, low master rents, and a positive retail outlook for Singapore, we believe the probability of Toshin’s non-renewal is very low. Even in a scenario of non-renewal, we believe management could attract similar retailers, given sponsor YTL’s network of contacts among luxury retailers. Risks should also be mitigated by the requirement for Toshin to provide advance notice of non-renewal 12 months before expiry.

Risks increase with each new market. As Starhill continues to diversify into more and more markets, we anticipate additional overheads including due-diligence studies and property-management costs. Furthermore, unfamiliarity with new markets may render Starhill less competitive than its local peers in terms of leasing and property
management. Tax leakages and foreign-currency risks could also climb with each additional country though Starhill seeks to limit the impact through natural hedging. Risks could also come from poor asset acquisitions in unfamiliar markets.

Lack of full control over Ngee Ann City and Wisma Atria. Starhill’s two key assets, Ngee Ann City and Wisma Atria, are strata-titled malls with 74% and 27% voting rights respectively. Although ownership is less fragmented than the strata-titled assets held by several individual owners, with only two other owners in each building (Ngee Ann Kongsi in Ngee Ann City and Isetan in Wisma Atria), the lack of full control and rights to asset management could affect future plans for the assets, such as AEI, tenant mix, and positioning. This could in turn compromise its strategy which may not optimise the generation of rental income for the REIT.

Financials
Stable income with upside from master lease renewals. As a projected 44% of Starhill’s FY11 revenue is expected to come from master leases and long leases, income is expected to be stable. Some near-term upside is expected from locked-in upward renewals/step-up mechanisms in the Toshin and David Jones master leases in FY11, the YTL master lease in FY13 and other specialty tenants at David Jones Building annually. For its non-master lease assets, we expect mild reversions of 0-4%. We expect flat rents for its office assets in FY11 before rents pick up again from FY12. Retail rents are, meanwhile, expected to stabilise with a 3% reversion annually. With a more bleak retail outlook in Japan, we project flat rates for its Japanese assets. Occupancy across its retail assets is expected to remain more or less unchanged from FY10 levels except the retail space at Wisma Atria. We expect occupancy at its office assets to stabilise at 90% and above beyond FY11.

AEI at Wisma Atria. Total expected capex for AEI at Wisma Atria is S$31m. This will be funded by proceeds from its rights issue in 2009 and/or working capital and no equity fund-raising will be required. We factor in an annual return on investment of 8% (S$2.5m) when the asset stabilises, tracking management guidance, though we believe there could be upside should Starhill succeed in securing even higher rentals from its tenants after the AEI.

Asset leverage at 30%, lower than sector average. With a BBB corporate family rating assigned by ratings agency S&P, Starhill is able to leverage up to 60% of its asset size. However, management is more comfortable with a lower target of 40%. This would give it debt headroom of about S$450m for potential acquisitions.

No refinancing risks till 2013. As Starhill had successfully refinanced S$123m of its S$570m debt maturing in Sep 10 with a 5-year fixed-rate medium-term note and the balance through term loan facilities ahead of loan maturity in Sep 10, the REIT does not have any major refinancing concerns until 2013.

Minimal tax leakage from overseas assets. Starhill sees annual tax leakages of S$3m-5m through withholding taxes of 10-15% on its assets in Australia, China and Japan. Its ownership of Malaysian assets has been structured in a tax-efficient manner (due to the tax-exemption status of coupon payments and dividend payments from the SPV holding the Malaysian assets). Taxes are thus not expected to increase significantly from current levels.

Key assumptions. We have factored in 8% ROI for AEI at Wisma Atria and S$31m capex, and expect a dip in occupancy in 2011-12 for retail space at the property during the AEI. With no significant debt due for refinancing till 2013, we have factored in a stable cost of debt of 3.8%. Tracking its practice in 2010, we have also assumed a 100% payout of management fees in cash and an actual payout of 98% from the total distributable income. Of these, about S$9.8m each year will go to CPU holders
(convertible preferred unit holders who previously funded Starhill’s asset purchases in Malaysia) while the remainder will go to ordinary unit holders.

Valuation and recommendation
DDM-derived valuation. We used DDM to value Starhill, the methodology we use to value all the REITs under our coverage. We use a discount rate of 8.4%, derived from a risk-free rate of 4.1%, an equity risk premium of 4.9% and a beta of 0.9. Our risk-free rate and equity risk premium are derived from blended rates in the respective countries, weighed by income contributions from Starhill’s assets in the respective countries. We also assume a terminal growth rate of 2%.

Initiate coverage with Outperform and target price of S$0.74. We initiate coverage with a target price of S$0.74, which represents a total return of 23.1% from a forward yield of 6.7% and price upside of 16.4%. At FY11 DPU yields of 6.7% and P/BV of 0.7x, Starhill is the cheapest retail REIT under our coverage. Though its overseas exposure could increase risks and the Orchard Road retail outlook is less positive, we believe these could be somewhat mitigated by master leases and long leases in its portfolio. With asset leverage of 30% (lower end of the 20-40% leverage in the sector), AEI and acquisitions are also unlikely to entail substantial equity fund-raising. We see catalysts from higher rental revisions, AEI and accretive acquisitions.


Source/转贴/Extract/: CIMB Research
Publish date:03/06/11

2011-0530-57金錢爆5-1(中國50年大旱 三峽大壩拉警報!?)






Source/转贴/Extract/: youtube
Publish date:30/5/11

PCCW gets OK for telecom business-trust spinoff

The Hong Kong stock exchange stepped up its competition with Singapore by approving an estimated $650 million spinoff of PCCW Ltd’s (0008.HK) telecommunications units into the city’s first listed business trust.

PCCW, chaired by media tycoon Richard Li, was given the approval late on Thursday. The news boosted PCCW shares as much as 7 percent to a five-week high on Friday, bucking a 1.1% fall in benchmark Hong Kong share index <.HSI>.

The approval came after PCCW appealed a decision made in April by the exchange’s listing committee to block its plan for the city’s first listed business trust.

Hong Kong Exchanges and Clearing (0388.HK) does not yet have regulatory framework in place to allow business trust listings and is working to have the rules in place within the next few months. That will establish a level playing field with Singapore Exchange (SGXL.SI), which already allows such listings.

PCCW is working with Hong Kong regulators to finalise a structure that would enable the business trust to operate within Hong Kong’s existing regulatory framework.



Source/转贴/Extract/: http://theedgesingapore.com
Publish date:03/06/11

Tiger Airways: Thai-Tiger still in the cards (DMG)

Tiger Airways: Thai-Tiger still in the cards
(NEUTRAL. S$1.33, TP S$1.40)

We recently had a conference call with Thai Airways over the fate of Thai Tiger. Thai Airway’s new budget carrier, Thai Wings is not meant to replace Thai Tiger but will target the middle market, and be similar to Singapore Airline’s Silkair. However the fate of the JV still remains in the hands of Thailand’s Ministry of Transportation and will be known after the Thai elections set for 3 July 2011. We maintain our neutral stance with a TP of S$1.40.

Thai Wings not to replace Thai-Tiger. Thai Airways’s new budget carrier, Thai Wings which is targeted to commence operations by April 2012 will not be in direct competition with Thai-Tiger. Instead, it will be targeting the middle market, in between the high end and lower end and be similar to SIA’s SilkAir. Our channel checks reveal that while Thai Airways has a 39% stake in budget carrier NokAir (which also services the middle market), Thai has been unhappy with its minority stake as it is unable to exert enough control over the airline’s strategy and operations. We also believe that Thai wishes to gain from Tiger’s expertise in running a low cost airline.

Details on Thai-Tiger. The future of Thai-Tiger is still pending the Ministry of Transport’s approval and will be known after the Thai elections which is due to be held on 3 July 2012. We were told that while Thai will hold the majority stake (51%) in the JV, all the branding of the planes will be under Tiger Airways and the fleet will come from the latter. It said that Tiger has committed ten A320s in the first year should the JV take-off. Tiger is expecting net nine new aircraft deliveries this FY12 so we should expect it to advance deliveries should the JV be approved. The first route to be taken by the JV would be Tiger’s current BKK-SIN route.

Huge upside if JV is approved. We believe the Thai market offers huge potential for Tiger should the Thai-Tiger JV be approved. At present, we understand that Thai Airways holds a 40% market share while Air Asia holds another 40%. While it appears that Thai has lost market share to Air Asia, we were told by management that absolute number of passengers carried has actually not dwindled but Air Asia has just managed to create a whole new niche demand. We believe that Thai-Tiger is well placed to be a formidable competitor to Thai Air Asia as it would be part of the national carrier’s arm. This would be appealing to the patriotic Thais who are potentially likely to favor supporting their own national carrier.

Valuations. We have chosen to be conservative with our estimates and assumed that the Thai- Tiger JV will not be approved. We maintain our earnings estimates for now and maintain our NEUTRAL stance on the stock with a TP of $1.40, pegged to 12x FY12F earnings.


Source/转贴/Extract/: DMG & Partners Research
Publish date:03/06/11

S'pore stocks fairly attractive, say brokers

Business Times - 03 Jun 2011


S'pore stocks fairly attractive, say brokers

Negative earnings revisions only natural after a year of high GDP growth, says Citi analysis

By MICHELLE TAN

(SINGAPORE) Investors should not fear negative earnings revisions as this is likely a normalisation of earnings expectations, says Citigroup.

Singapore's earnings revision count (ERC) indicator has fallen off of late, implying signs of a weaker market as the negative earnings revision count exceeded the positive earnings revision count by 14 per cent.

However, the negative ERC is likely to be a normalisation of earnings expectations as the local economy adjusts to a slower rate of growth of 7 per cent in 2011 from 15 per cent in 2010.

More importantly, investors should note that upon closer inspection on recent upgrades and downgrades, one would notice certain sector-specific trends.

For instance, energy sensitive counters such as Singapore Airlines, Neptune Orient Lines, SMRT and ComfortDelGro have been punished in terms of pricing as investors factor in the impact of rising energy costs in the global market.

An array of real estate firms - such as CapitaLand, Wing Tai and Keppel Land - were also not spared from the falling knife as sentiment faltered following a string of earnings downgrades.

On the other side of the fence where pastures seem greener, offshore players such as Keppel Corp and Sembcorp Marine had much to smile about as revenues and margins were bolstered by rising oil prices.

Local banks also had their run as they saw a steady stream of upgrades from brokers post-results season.

On a more macro level, inflationary worries have moderated of late as April's consumer price index (CPI) came in lower at 4.5 per cent year-on year as opposed to January's CPI of 5.5 per cent.

That said, overall sentiment continues to weigh on the Straits Times Index (STI) which has seen difficulty holding on to earlier gains.

However, from a valuation standpoint, the STI remains fairly attractive, say brokers.

'We expect the market to grind higher in 2011,' commented Patrick Yau from Citigroup in a report.

To highlight, the STI currently trades between 13 and 14 times 12-month forward price-to-earnings, which is under its long-term mean of 15 times.

Mr Yau also added that Citigroup currently has a bottom-up STI target of 3,558 which is about 13 to 14 per cent higher than current levels and sees counters such as CapitaLand, DBS Group, Hongkong Land, OCBC, Keppel Corp, Golden Agri Resources, Wilmar and SingTel as potential key index drivers going forward.

In addition, resilient plays such as Ascendas Real Estate Investment Trust (A-Reit), SingTel and Singapore Press Holdings (SPH) were noted as counters that are likely to retain their charm with investors in light of their attractive dividend yields.

In particular, though SPH recently faced an earnings downgrade and a target price cut from $4.40 to $4.25, Citigroup maintains that the media group remains attractive with dividend yields of about 6 per cent.

All in all, analysts generally concur that investors are more likely to get more bang for their buck from big cap stocks that are in mid-to-late economic cycle plays and maintain a more neutral-to-bullish stance towards the STI going forward as opposed to a bearish one.

The STI closed 12.27 points or 0.4 per cent lower at 3,160.6 yesterday.



Source/转贴/Extract/: www.businesstimes.com.sg
Publish date:03/06/11
Warren E. Buffett(沃伦•巴菲特)
Be fearful when others are greedy, and be greedy when others are fearful
别人贪婪时我恐惧, 别人恐惧时我贪婪
投资只需学好两门课: 一,是如何给企业估值,二,是如何看待股市波动
吉姆·罗杰斯(Jim Rogers)
“错过时机”胜于“搞错对象”:不会全军覆没!”
做自己熟悉的事,等到发现大好机会才投钱下去

乔治·索罗斯(George Soros)

“犯错误并没有什么好羞耻的,只有知错不改才是耻辱。”

如果操作过量,即使对市场判断正确,仍会一败涂地。

李驰(中国巴菲特)
高估期间, 卖对, 不卖也对, 买是错的。
低估期间, 买对, 不买也是对, 卖是错的。

Tan Teng Boo


There’s no such thing as defensive stocks.Every stock can be defensive depending on what price you pay for it and what value you get,
冷眼(冯时能)投资概念
“买股票就是买公司的股份,买股份就是与陌生人合股做生意”。
合股做生意,则公司股份的业绩高于一切,而股票的价值决定于盈利。
价值是本,价格是末,故公司比股市重要百倍。
曹仁超-香港股神/港股明灯
1.有智慧,不如趁势
2.止损不止盈
成功者所以成功,是因为不怕失败!失败者所以失败,是失败后不再尝试!
曾淵滄-散户明灯
每逢灾难就是机会,而是在灾难发生时贱价买股票,然后放在一边,耐性地等灾难结束
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