Regional Daily, Maybank KE (2014-05-15)

Daily 15 May 2014 TOP VIEWS Lenovo Group (992 HK) | Results Review Q&M Dental Group (QNM SP) | TP Revision Hemaraj Land & Dev (HEMRAJ TB) | Results Review Metropolitan Bank & Trust Co. (MBT PM) | TP Revision Lenovo Group (992 HK) | Results Review Stay on the sidelines Share Price: HKD8.69 | Target Price: HKD7.80(-10%) | ADTV (USD): 58M | MCap (USD): 11.7B 4Q14/FY14 results out 21 May. Expect Lenovo to meet recently downward revised consensus and our forecasts. Outlook for PC is stable but MIDH faces more competition and slower demand. Maintain HOLD and TP of HKD7.80. Stock driven by pending acquisitions of Moto smartphone and IBM�s x-system server. Click here for report » Q&M Dental Group (QNM SP) | TP Revision Results in-line, China remains key catalyst Share Price: SGD0.475 | Target Price: SGD0.55(+16%) | MCap (USD): 230M | ADTV (USD): 0.9M 1Q14 core earnings jumped 37.1% YoY on organic and acquisition-led growth. Acquisitions of China�s dental players with access to National Medical Insurance Scheme the key catalyst. TP raised to SGD0.55, based on a higher P/E multiple of 39x (previously 34x) and after incorporating the acquisitions of Aidite which is close to completion. Click here for report » Hemaraj Land & Dev (HEMRAJ TB) | Results Review Strong as expected; sector Top Pick Share Price: THB3.38 | Target Price: THB4.80(+42%) | MCap (USD): 1.0B | ADTV (USD): 3M 1Q14 normalised net profit up 43% YoY to THB0.987bn. Land sales remain the key profit contributor in 1Q14. Land sales hit THB2.2bn and gross margins were high at 51%. 1Q14 land sales accounted for 36% in value and 41% in volume. Maintain BUY with NAV-based target price of THB4.8. 1Q14 reported revenues and normalised profit accounted for nearly 33.3% and 27% of our full year forecast, respectively � maintain forecast Click here for report » Metropolitan Bank & Trust Co. (MBT PM) | TP Revision Better than expected 1Q14 income Share Price: PHP86.00 | Target Price: PHP92.00(+7%) | MCap (USD): 5.4B | ADTV (USD): 7M Maintain HOLD with just 7% upside to our new TP of PHP92. 1Q14 earnings were ahead of expectations at 36% of FY14E. Surprise from miscellaneous income slightly tempered 92% plunge in trading gains. FULL NOTE WILL BE OUT SOON COMPANY NOTES Tata Communications (TCOM IN) | Results Review Tan Chong Motor (TCM MK) | Rating Change Petron Corp (PCOR PM) | Results Review Security Bank Corp (SECB PM) | TP Revision Mermaid Maritime (MMT SP) | Results Review Neptune Orient Lines (NOL SP) | Results Review CWT (CWT SP) | Results Review Robinson Department Store (ROBINS TB) | Company Update Industrial Estate | OVERWEIGHT Land & Houses (LH TB) | Rating Change Pruksa Real Estate (PS TB) | Company Update Tata Communications (TCOM IN) | Results Review Bandwidth for sustainable growth Share Price: INR286 | Target Price: INR405(+42%) | MCap (USD): 1.4B | ADTV (USD): 4.5M We maintain BUY with TP of INR405 based on sum-of-the-parts valuation. 4QFY14 operational performance was in line with our expectations, with EBITDA of INR7.8b, unchanged QoQ. We maintain our FY15-16 forecast with EBIT CAGR of 21% over FY14-16. Strengthening of balance sheet through the sale of stake in Neotel and land parcels remains the near-term catalyst. Click here for report » Tan Chong Motor (TCM MK) | Rating Change Significantly sub-par 1Q14; cut to HOLD Share Price: MYR5.59 | Target Price: MYR5.25 (-6%) | MCap (USD): 1.1B | ADTV (USD): 0.2M 1Q14�s MYR42m net profit made up just 14%/13% of our/ consensus initial forecasts, hit by intense price discounting. Cut FY14-16 earnings forecasts by 13%-34% on lower: (i) vehicle sales and (ii) EBITDA margins assumptions. Downgrade to HOLD; TP lowered TP by 23% to MYR5.25 (12x FY15 PER). FULL NOTE WILL BE OUT SOON Petron Corp (PCOR PM) | Results Review Less volatile 1Q14 Share Price: PHP12.26 | Target Price: PHP15.90(+30%) | MCap (USD): 2.6B | ADTV (USD): 3M 1Q14 reported net income reached PHP2.23b, accounting for 29% of our full-year 2014 forecast. Although flattish YoY, 1Q14 was historically one of the best performing quarters as stable oil prices boosted margins. RMP-2 is now 98% complete and on-track for start of operations in 4Q14. Pending detailed FS, maintain BUY with TP of PHP15.90. FULL NOTE WILL BE OUT SOON Security Bank Corp (SECB PM) | TP Revision Strong loan growth boosts earnings Share Price: PHP122.50 | Target Price: PHP141.00(+15%) | MCap (USD): 1.7B | ADTV (USD): 2M Maintain BUY with TP upgraded to PHP141, equivalent to 1.9x 2014F PBV and 13.4x PER. 1Q14 earnings up 17% to PHP1.43b, accounting for 27% of full-year estimate. Robust loan demand of 39% boosts net interest income 42%. FULL NOTE WILL BE OUT SOON Mermaid Maritime (MMT SP) | Results Review Weaker subsea a huge drag Share Price: SGD0.47 | Target Price: SGD0.59(+26%) | MCap (USD): 531M | ADTV (USD): 1.0M 2QFY9/14 PATMI plunged 60.7% QoQ to USD5.2m, coming in below our expectations. Subsea utilisation weak due to seasonality and vessel mobilisation. Management expects 2HFY9/14 to catch up. Turnaround story still intact. Maintain BUY with lower TP of SGD0.59, pegged to 14x FY9/14E P/E. Click here for report » Neptune Orient Lines (NOL SP) | Results Review Narrowing losses Share Price: SGD1.00 | Target Price: SGD1.00(+0%) | MCap (USD): 2.1B | ADTV (USD): 2M 1Q14 net loss of USD98m in line with our expectations. Core EBIT losses narrowed to USD65m (1Q13: USD76m). Reduced losses largely attributable to the 6% YoY improvement in average slot cost. Guidance still negative. Maintain HOLD with unchanged TP of SGD1.00, based on 1.0x FY14E P/BV. Click here for report » CWT (CWT SP) | Results Review A strong start to the year Share Price: SGD1.58 | Target Price: SGD1.90(+20%) | MCap (USD): 758M | ADTV (USD): 0.9M 1Q14 results beat, with revenue more than tripling to SGD4.5b and net profit up 30% YoY to SGD35.0m. Commodity trading was the key surprise, delivering a 238% YoY gain in revenue. This leads us to raise our FY14E-16E forecasts by 9-18%. Reiterate BUY with SOTP-based target price raised to SGD1.90. Click here for report » Robinson Department Store (ROBINS TB) | Company Update New strategy; give it time: HOLD Share Price: THB50.25 | Target Price: THB53.00(+5%) | MCap (USD): 1.7B | ADTV (USD): 1M New president is clear on the strategy to make the Robinson Department Store brand the destination for the majority of shoppers both in Thailand and Vietnam. Outlook in Thailand remains weak but appears situation bottomed. The 1st store in Vietnam opened in Apr met with warm welcome; very upbeat on the long-term success. Maintain HOLD. Major re-positioning takes time and operating results may soften for a while. Thus, while we like the long-term proposition of RDS, maintain HOLD (DCF-based target price THB53) as the short-term outlook remains challenging. Click here for report » Industrial Estate | OVERWEIGHT Sector Update 1Q14 a write-off, long term intact 1Q14 earnings will be weak for AMATA and TICON but good for HEMRAJ thanks to high land transfers; earnings expected to be announced shortly. Market conditions have turned around since Mar-14 and 2Q14 performance could start improving, but will still be below �normal�. Maintain BUY on HEMRAJ, TICON and AMATA (in this order of preference) on the basis the long to medium-term foreign investment outlook remains positive and the three operators� properties are in prime locations to tap growth. Click here for report » Land & Houses (LH TB) | Rating Change 1Q14: In line; d/g to HOLD Share Price: THB9.80 | Target Price: THB10.70(+9%) | MCap (USD): 3.0B | ADTV (USD): 6M Downgrade to HOLD with limited upside to our lowered TP of THB9.0 (from THB10.7) after factoring in newly issued warrants. 1Q14 results in line with consensus at THB1.4b (EPS THB0.14), down 9% QoQ and flat YoY. 1Q14 core profit accounts for 22% of our FY14 estimates. Likely to revise down presales target of THB32b after 1Q14 presales (THB6.6b) were 15% behind target; a de-rating catalyst. FULL NOTE WILL BE OUT SOON Pruksa Real Estate (PS TB) | Company Update 1Q14: Nothing comes as a surprise Share Price: THB21.90 | Target Price: THB21.90(+0%) | MCap (USD): 1.5B | ADTV (USD): 3M Maintain HOLD and TP of THB21.9 on limited upside and challenging outlook. Prefer AP (BUY TP THB6.5) and SPALI (BUY TP THB25.5). 1Q14 earnings in line with our expectation at THB1,065m (EPS THB0.48), down 53% QoQ but up 38% YoY. This accounts for 18% of our FY14 forecast. Planning to launch 20-22 projects valued at THB18b in 2Q14. Current backlog secures 58% of our 2Q-4Q14 revenue forecast. FULL NOTE WILL BE OUT SOON