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ASEAN STOCK WATCH Asean Affairs   5 April 2012

ASEAN will follow Wall St Lower
 

By Shayne Heffernan Ph.D.
 

ASEAN will follow Wall St Lower today after The Dow Jones Industrial Average slid 116 points, or 0.9%, to 13083 in Wednesday afternoon trading. The Standard & Poor’s 500-stock index shed 15 points, or 1%, to 1399, while the Nasdaq Composite lost 51 points, or 1.7%, to 3062.

Technology stocks led the market lower. Microsoft and Cisco Systems were among the biggest percentage decliners of the Dow components. Financial stocks were also weak. Bank of America led the Dow decliners, while J.P. Morgan Chase also fell.

The moves came after a revival of fears about Europe’s debt situation. Spain sold just EUR2.589 billion ($3.4 billion) of bonds, at the bottom of its planned range, and at yields that were well above previous auctions. Following the auction, yields on 10-year Spanish government debt rose to 5.712%, from 5.445% Tuesday, the highest level since Jan. 9.

European stocks fell sharply. Germany’s DAX index skidded 2.8%, while France’s CAC-40 closed down 2.7%.

A revised reading of euro-zone business activity in March, which confirmed contraction, also hurt sentiment, as did a decline in euro-zone retail sales in February.

Meanwhile, the European Central Bank left its main interest rate unchanged for the fourth-straight month, as expected. In a news conference after the decision, ECB President Mario Draghi warned risks to growth remain and any discussion of how and when the ECB will unwind its unconventional measures to fight the crisis was premature.

ASEAN +3 is the Association of Southeast Asian Nations (ASEAN), the People’s Republic of China (including Hong Kong), Japan, and South Korea.

Home to 600 million people, ASEAN has a combined gross domestic product (GDP) of US$1.8 trillion with total trade valued at $2 trillion among the countries.

ASEAN is set to explode as an economic force in 2015 as financial, trade and investment rules become integrated and seamless. Asean last year secured $78.5 billion in investments. Regional trade also increased by 32.9 percent to more than $2 trillion.

The Association of Southeast Asian Nations is beefing up various frameworks for cooperation and development within the region and with its trading partners, in preparation for regional economic integration by 2015.

FTSE Group and the five ASEAN exchanges (Bursa Malaysia, Indonesia Stock Exchange, The Philippines Stock Exchange, Singapore Stock Exchange and The Stock Exchange of Thailand) have joined forces to launch a unique and innovative set of indices known as the FTSE/ASEAN Index series.

The FTSE/ASEAN 40 Index Constituents comprise some of ASEANs leading Equities.

The indices aim to provide domestic and global investors with increased financial exposure to ASEAN markets in the form of a benchmark and tradable index offering opportunities for the creation of investment products such as index-linked funds, ETFs and derivative products.

Both indices are market cap weighted and designed using eligible stocks within the FTSE All-World universe. The real-time data is delivered by FTSE, Reuters, Bloomberg, Thomson One and Global Topic and published in US Dollars.

FTSE/ASEAN 40 Index constituents   

SEDOL             Constituent Name              Country Code       Index Marker
6366999          Gudang Garam                         INDO              ASEAN40
B02ZK79          Telekomunikasi Indonesia           INDO              ASEAN40
6291712           Astra International                   INDO              ASEAN40
6687184           Unilever Indonesia                    INDO              ASEAN40
6230845           United Tractors                       INDO               ASEAN40
B01C1P6            Bank Central Asia                    INDO               ASEAN40
6651048            Bank Mandiri                           INDO              ASEAN40
6709099            Bank Rakyat Indonesia             INDO               ASEAN40
6719764           Perusahaan Gas Negara             INDO               ASEAN40
B2QZGV5          Axiata Group Bhd                      MAL               ASEAN40
B5387L5           Maxis Bhd                                 MAL               ASEAN40
B5KQGT3          PETRONAS Chemicals Group Bhd  MAL              ASEAN40
B1VXJL8           Genting                                     MAL              ASEAN40
6556325          Malayan Banking                          MAL              ASEAN40
B29TTR1          Sime Darby Bhd                          MAL              ASEAN40
B1Y3WG1         IOI                                           MAL              ASEAN40
6904612          Tenaga Nasional                          MAL              ASEAN40
6075745          CIMB Group Holdings                    MAL              ASEAN40
6703972          Petronas Gas                               MAL              ASEAN40
B012W53         Public Bank Fgn                           MAL              ASEAN40
6685661          Phil Long Dist Tel                         PHIL              ASEAN40
6197928          City Developments                        SI                ASEAN40
B1VQ5C0         Keppel Corp                                 SI                ASEAN40
6811734         Singapore Airlines                           SI                ASEAN40
6916781         United Overseas Bank                     SI                ASEAN40
B0F9V20         Oversea-Chinese Banking                 SI                ASEAN40
6175203         DBS Group Holdings                        SI                ASEAN40
6242260         Jardine Cycle & Carriage                   SI                ASEAN40
B02PY22         Singapore Telecom                          SI                ASEAN40
6043214         Singapore Technologies Engineering  SI                 ASEAN40
6309303        Capitaland                                      SI                  ASEAN40
B17KC69        Wilmar International Limited              SI                  ASEAN40
6366795         Genting Singapore                          SI                  ASEAN40
6889924        Siam Commercial Bank PCL              THAI              ASEAN40
6412568        Advanced Info Serv                       THAI               ASEAN40
B1359K1         PTT Exploration & Production        THAI              ASEAN40
6077008         Bangkok Bank                              THAI              ASEAN40
6609917         Siam Cement                              THAI              ASEAN40
6888783         Kasikornbank                               THAI              ASEAN40
6420389          PTT                                          THAI              ASEAN40


Singapore will open lower today after a sell off on Wall St
Shayne Heffernan Best Buys DBS, Genting, Wilmar

DBS
DBS Group Holdings Ltd is an investment holding company that operates through its main subsidiary, DBS Bank Ltd (the Bank). The Bank is engaged in the provision of retail, small and medium-sized enterprise, corporate and investment banking services. The Company’s financial businesses are organized into four segments: consumer/private banking, institutional banking, treasury and others.
Consumer/ Private Banking provides individual customers with a range of banking and related financial services. Institutional Banking provides financial services and products to institutional clients including non bank financial institutions, government linked companies, large corporates and small and medium-sized businesses. Treasury provides treasury services to corporations, institutional and private investors, financial institutions and other market participants. Others encompasses a range of activities from corporate decisions.

Genting
Genting Singapore PLC, along with its subsidiaries, is engaged in development and operation of integrated resort, operation of casinos, investments, provision of sales and marketing services and information technology (IT) related services to leisure and hospitality related businesses.
It operated in two segments: leisure and hospitality, which is engaged in provision of sales and marketing services and IT related services to leisure and hospitality related businesses. In September 2011, it incorporated a subsidiary Tamerton Pte. Ltd.
In September 2011, it incorporated a subsidiary Prestelle Pte. Ltd. In September 2011, it acquired Blue Shell International Limited and incorporated Orionbest Pte. Ltd. In November 2011, the Company through its subsidiary, Northspring Resources Ltd, incorporated a wholly owned subsidiary, North Spring Enterprises LLC in Mongolia. In December 2011, the Company incorporated a wholly owned subsidiary North Spring Capital Blue LLC.

Wilmar
Wilmar International Limited is an investment holding company engaged in the provision of management services to its subsidiaries. It operates in five segments: palm and laurics comprises the merchandising and processing of palm oil and laurics related products; oilseeds and grains segment comprises the merchandising and processing of a range of edible oils, oilseeds and grains from the crushing, further processing and refining of soybean, as well as other oilseeds and grains; consumer products segment comprises packaging and sales of consumer pack edible oils, rice, flour and grains; plantation and palm oil mills segment comprises oil palm cultivation and milling, and others segment includes the manufacturing and distribution of fertilizer products and ship-chartering services. In December 2010, the Company acquired Sucrogen Limited. On January 8, 2010, it disposed its entire 98.39% interest in Hop Yick Packaging & Manufacturing (Shenzhen) Co., Ltd.

Yesterday in Singapore
The FTSE Straits Times Index (STI) ended 29.94 points lower or -0.99%, closing at 2985.04. This brings the STI 2012 year-to-date performance to +12.80%. The FTSE ST Mid-Cap Index and FTSE ST Small-Cap Index also ended lower, with the Mid-Cap Index declining -0.34% and the Small-Cap Index declining -0.57%. Among the 30 stocks that make up the STI, there were 2 gainers and 25 decliners and 3 stocks unchanged.

The top three most actively traded stocks were DBS Group Holdings (-2.25%), Genting SP (-1.18%) and Wilmar (-1.02%).

The FTSE ST sectors were lower except for the FTSE Real Estate Investment Trusts Sector which firmed a marginal +0.01%. The two largest REITs by market cap that make up the FTSE Real Estate Investment Trusts Sector are CapitaMall and Ascendas REIT. CapitaMall declined -0.82% and was also the most active REIT today by turnover. Ascendas REIT remained unchanged. The top three REITs by turnover were CapitaMall , Suntec REIT (unchanged) and CapitaCommercial REIT (unchanged). The FTSE Real Estate Investment Trusts Sector has gained 0.48% over the first three sessions of April.

The two underperforming FTSE ST sectors were Basic Materials and Financials, which declined -1.61% and -1.13% respectively. The two largest stocks by market cap of the FTSE ST Basic Materials Sector are Sakari Resources (-2.55%) and Midas Holdings (unchanged). The two largest stocks by market cap of the FTSE ST Financials sector are DBS Group Holdings and OCBC Bank (-0.89%)

The three most active Exchange Traded Funds (ETFs) by value were SPDR Gold Shares (-2.65%), iShares USD Asia High Yield Bond Index ETF (+0.95%) and Lyxor China H-shares (-1.67%).

Thai Stocks: Kitichai Taechangamlert on Sahaviriya Steel Industries
Kitichai Taechangamlert speaks with Economist Shayne Heffernan on Sahaviriya Steel Industries
Sahaviriya Steel Industries has already been severely discounted all the bad news (the bad earning ‘s performance of 2011 : the increase of its material in the beginning of 2011 from Australia, the earthquake n Tsunami in Japan, the financial turmoil in EU, and the flood in Thailand).

The investors are looking for the coming good news from the starting its operation of SSI-UK(expect in March 2012), the pent-up demand of the auto and electronic sectors, Thai ‘s government ‘s mega projects such as flood preventing, mass transportation, etc. Sahaviriya Steel Industries price per book value is merely 0.56, very low valuation.

Sahaviriya Steel Industries CEO, Khun Win said that SSI-UK will operate with full capacity in Q4 of 2012, so it will generate more revenue n earning to SSI. If one looks at its technical chart, you may notice that its 5 days EMA has just broken is 10 days EMA last Friday, and will break its 25 and 75 days EMA today. Its MACD will break its MA today, showing a STRONG BUY SIGNAL.

Sahaviriya Steel Industries Public Company Limited, together with its subsidiaries, manufactures and distributes hot rolled coils in Thailand. The company offers hot rolled steel sheet in coils, hot-rolled coils picked and oiled products, cold rolled steel sheets, electro-galvanized coils, round steel bars and deformed steel bars, wire rods, and C-channels.

It also provides deep-sea port services, and maintenance and engineering services, as well as engineering design services. The company sells its products to customers for direct use in automobiles and parts, gas cylinders, steel structures, steel pipe, and home appliances industries, as well as for cold-rolled steel sheet industry. It also exports its products internationally. Sahaviriya Steel Industries Public Company Limited was founded in 1990 and is headquartered in Bangkok, Thailand.
    
Company Highlights    
                                                                                  (Unit: M.Baht)
Period    Y/E ’08          Y/E ’09           Y/E ’10          Y/E ’11
as of     31/12/2008    31/12/2009    31/12/2010   31/12/2011

    
    
Financial Data     
Assets                       41,786.34     42,773.25     42,492.56     86,363.66     
Liabilities                    25,003.21     25,018.15     22,617.13     61,415.87     
Equity                       16,014.04     16,959.50     19,033.42     24,095.76     
Paid-up Capital            13,101.28     13,101.28     13,101.28     18,184.11     
Revenue                    27,894.27     39,010.55     48,538.00     53,306.41     
Net Profit                   -5,166.20       1,273.20       2,445.81        -980.77     
EPS (Baht)                       -0.39             0.10              0.19           -0.06     


Financial Ratio     
ROA(%)                       -11.28         5.57         7.97          1.15     
ROE(%)                          -26.72         7.72         13.59         -4.55     
Net Profit Margin(%)         -18.52         3.26          5.04         -1.84     


Statistics as of          30/12/2008       30/12/2009       30/12/2010       30/12/2011     26/03/2012
Last Price(Baht)              0.53                   1.20                   1.50                0.71               0.80
Market Cap.             6,943.68           15,721.54           19,651.92          2,910.72       14,547.29

F/S Period (As of date)  30/09/2008       30/09/2009       30/09/2010     30/09/2011     31/12/2011
P/E                                    13.56                  N.A.                 5.55               8.91                 N.A.
P/BV                                   0.31                 0.99                  1.03               0.49                 0.60
Book Value per share (Baht)   1.69                 1.21                  1.45               1.45                 1.33
Dvd. Yield(%)                        9.43                 N.A.                  N.A.               N.A.                  N.A

Indonesia will open lower today on the back of a steep fall on Wall St overnight.
U.S. stocks fell for a second day on Wednesday as investors faced the prospect of no new monetary stimulus from the Federal Reserve and as a poorly received bond auction in Spain suggested the effects of earlier European funding operations may be waning.
 

Selling was broad as indexes tracking nine of the 10 S&P 500 sectors were lower, with energy, financial and technology stocks among the worst performers. The benchmark S&P 500 index has fallen in eight of the past 12 sessions. The Nasdaq was on track for its worst daily percentage drop since Dec. 8.

Spanish borrowing costs jumped at bond auctions, raising concerns that the rally in troubled peripheral sovereign debt sparked by the European Central Bank’s two Long-Term Refinancing Operations may be coming to an end.

Stocks continued to feel the fallout from minutes from the Federal Reserve’s latest meeting, published on Tuesday. They showed the Fed’s policy-setting Federal Open Market Committee was moving away from introducing more monetary stimulus in a surprise turn for the market.

Moody’s downgraded the ratings of conglomerate General Electric Co and its finance unit, GE Capital, each by a notch, saying there were “material risks” associated with GE Capital’s funding model. The stock, a Dow component, fell 1 percent to $19.76.

Shayne Heffernan Best Buys are Bank Danamon and Nusantara Infrastructure
Nusantara Infrastructure is set to become the first private company to operate an Indonesian seaport, a top official said on Wednesday.

Ramdani Basri, the company’s president director, said Nusantara has agreed to purchase a 39 percent stake in Inti Sentosa Alam Bahtera, which runs the Panjang seaport in southern Sumatra, for $10 million to $11 million.

“The acquisition will complement our business and make us the first private company to operate a seaport in Indonesia,’’ he said, adding that the deal was signed on Tuesday.

Panjang seaport, located in Lampung, processes shipments of chemical products and commodities. Ramdani hopes it will become a hub that links global trade centers such as India, Africa and Europe.

“The seaport is a base for commodities,” he said.

He said Nusantara signed the deal through its unit Portco Infranusantara and expects to earn up to $3.12 million in annual revenue from the port. Inti Sentosa Alam Bahtera is forecast to make up to $8 million in revenue annually from the port.

Nusantara Infrastructure is 23.6 percent owned by Rajawali Group, a conglomerate controlled by business tycoon Peter Sondakh. It operates four toll roads on Java and Sulawesi.

Rajawali Group is engaged in mining, transportation, agricultural estates, infrastructure and retail. It is also the controlling shareholder at Transpacific Railway Infrastructure, which manages railway development in South Sumatra.

Shares in Nusantara rose 7.7 percent to Rp 280 on the Indonesia Stock Exchange on Wednesday. The company’s shares have risen 37 percent this year.
Bank Danamon
DBS, owner of Southeast Asia’s biggest bank, is seeking to buy 67.4 percent of Danamon from a unit of Singaporean sovereign wealth fund Temasek Holdings, for 6.2 billion Singapore dollars ($4.9 billion). It will buy the remaining shares it doesn’t own from minority owners. Should all the shareholders sell, DBS would complete the purchase for 9.1 billion Singapore dollars.

The transaction is expected to be completed in the next six months, toward the end of the year, DBS’s chief executive officer, Piyush Gupta, said on Monday. Approval must also be given by authorities including Bank Indonesia, the central bank, and the Capital Market and Financial Institution Supervisory Agency (Bapepam-LK).

Harry, a lawmaker from the Golkar Party, which holds the second-largest number of seats in the House, said lawmakers were studying some options, including limiting investors to 20 percent stakes in banks, or limiting foreign investors to a 45 percent stake in banks here. A presidential decree in 2010 set the maximum foreigner ownership in banks here at 99 percent.

Arif Budimanta, also a member of the House’s finance commission from the Indonesian Democratic Party of Struggle (PDIP), was worried that foreign lenders would eat into the market share of local banks.

Muliaman Hadad, deputy governor at the central bank, said Bank Indonesia would send a letter to DBS, inquiring about its motives for acquiring Danamon.

He said the central bank would also ask about the reciprocal principle when deciding whether to approve the deal.

Karen Ngui, head of group strategic marketing and communication at DBS, defended the deal in an e-mail on Wednesday.

“DBS’ regional expertise in infrastructure, project finance, trade finance and Shariah banking will contribute to banking sector growth,” she said.

Yesterday in Jakarta
The Jakarta Composite Index lost 81.41 points, or 1.9 percent, to close at 4,134.04. The index hit its new record high — the first in eight months — of 4,215.44 on Tuesday after fears of inflation subsided as lawmakers voted to delay the fuel price increase.

The loss ended a 4.5 percent gain for the JCI in the past six days of trading. Trading volume was 3.69 billion shares, valued at Rp 4.91 trillion ($535 million), after reaching more than Rp 6 trillion each of the previous two days.

Foreign investors posted net sales for the first time in 17 consecutive trading days. Foreigners sold Rp 466.8 billion more than they bought in shares.

Shayne Heffernanwww.livetradingnews.com

Shayne Heffernan Ph.D.  
 
 
Linda Johnson, Business Development Director - Private Client Group, Heffernan Capital Management
Sales@Heffcap.com
 
Singapore
3 Raffles Place #07-01
Bharat Building Singapore 048617
Tel: +65 6329 6408 Fax: +65 6329 9699
Email : info@heffcap.com
 
Bangkok
Suite 53 Athenee Tower
63 Wireless Road, Lumpini, Pathumwan, Bangkok 10330
THAILAND Email : info@heffcap.com
 
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AseanAffairs   04 January 2011
By David Swartzentruber      

It is commonplace in journalism to write two types of articles at the transition point between the year that has passed and the New Year. As this writer qualifies as an “old hand” in observing Thailand with a track record dating back 14 years, it is time take a shot at what may unfold in Thailand in 2011.

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