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ASEAN STOCK WATCH Asean Affairs   16  March 2011

Asean Equities Face Mixed Day

Shayne Heffernan

The US market recovered from a sharp morning fall after US Federal Reserve policy makers said the recovery is gaining strength and that higher energy prices will have a temporary effect on inflation, while reaffirming plans to buy US$600 billion + of Treasuries through June.

“The economic recovery is on a firmer footing, and overall conditions in the labor market appear to be improving gradually,” the Federal Open Market Committee (FMOC) said today in its statement after a two-day meeting in Washington. The effects of higher fuel and commodity costs on inflation will be “transitory,” and officials “will pay close attention to the evolution of inflation and inflation expectations,” the Fed said.

Fed Chairman Ben S. Bernanke has signaled he wants to see more consistent gains in payrolls before considering pulling back record monetary stimulus that’s been criticized by Republican lawmakers. Central bankers have indicated the surge in oil and other commodity prices, which may crimp spending, won’t have a lasting impact on inflation.

In Asean today we expect some decliners, but should the Japan situation not deteriorate excessively we may see a rally in Asia.

Thailand should consolidate today and there is great buying for bargain hunters in quality stocks.

Shayne Heffernan Best Buys are:


Banpu Public Company Limited (Banpu) is a Thailand-based company engaged in coal mining and power businesses. The company has operations in Thailand and overseas, including Indonesia and the People’s Republic of China. Banpu supplies coal through its mines in the Lampang and Payao Provinces and via imported coal from Indonesia. The company's current operations in Indonesia are located in Jorong, Indominco, Kitadin, Trubaindo and Bharinto. In China, Banpu has mining projects in Daning, Hebi and Gaohe. As of December 31, 2009, the Company has for subsidiaries, namely Banpu Minerals Co., Ltd., Banpu Power Co., Ltd., BP Overseas Development Co., Ltd. and Banpu Power International Co., Ltd. On April 6, 2009 and June 22, 2009, the Company incorporated Banpu Australia Co. Pty Ltd. and Banpu Power Development Co., Ltd., respectively.

Valuation Ratios

Company Industry Sector S&P 500
P/E Ratio (TTM) 8.24 0.55 11.88 17.49
P/E High – Last 5 Yrs. 16.33 4.15 24.24 89.17
P/E Low – Last 5 Yrs. 6.71 0.21 13.53 12.28
Beta 1.23 0.04 0.87 1.32
Price to Sales (TTM) 3.12 0.09 7.78 2.19
Price to Book (MRQ) 3.34 0.21 0.78 2.98
Price to Tangible Book (MRQ) 126.21 0.16 0.92 5.30
Price to Cash Flow (TTM) 7.04 0.35 8.37 72.04
Price to Free Cash Flow (TTM) -- 0.51 6.69 20.51
% Owned Institutions - - - -



Company Industry Sector S&P 500
Dividend Yield 2.80 0.08 1.73 1.60
Dividend Yield – 5 Year Avg. 2.59 0.03 1.29 2.50
Dividend 5 Year Growth Rate 6.37 0.09 5.38 -5.49
Payout Ratio(TTM) 17.37 0.38 11.72 42.50


Growth Rates

Company Industry Sector S&P 500
Sales (MRQ) vs Qtr. 1 Yr. Ago 23.41 1.27 33.44 10.11
Sales (TTM) vs TTM 1 Yr. Ago 12.82 0.57 34.15 10.17
Sales – 5 Yr. Growth Rate 20.96 0.31 13.57 7.34
EPS (MRQ) vs Qtr. 1 Yr. Ago 201.24 7.76 117.83 78.29
EPS (TTM) vs TTM 1 Yr. Ago 66.35 - - -
EPS – 5 Yr. Growth Rate 34.79 0.19 9.23 4.47
Capital Spending – 5 Yr. Growth Rate 1.63 0.25 17.38 3.40



PTT Public Company Limited is a Thailand-based company engaged in the in upstream petroleum, downstream petroleum, coal business and other related businesses. Its business activities include the exploration for, the development and production of, natural gas, condensate and crude oil through subsidiaries; the procurement, transmission, processing, marketing and distribution of natural gas and gas products; the marketing of refined products through various distribution channels including commercial, retail, reseller and international markets, and the import and export of crude oil, condensate, petroleum feedstock and petrochemical products. As of Dec. 31, 2009, the Company was operating in 24 countries, as well as it has 17 subsidiaries.


Valuation Ratios

Company Industry Sector S&P 500
P/E Ratio (TTM) 11.96 22.60 11.88 17.49
P/E High – Last 5 Yrs. 11.74 24.06 24.24 89.17
P/E Low – Last 5 Yrs. 6.17 12.87 13.53 12.28
Beta 1.20 1.03 0.87 1.32
Price to Sales (TTM) 0.52 21.74 7.78 2.19
Price to Book (MRQ) 2.03 0.59 0.78 2.98
Price to Tangible Book (MRQ) 2.19 0.71 0.92 5.30
Price to Cash Flow (TTM) 6.72 16.66 8.37 72.04
Price to Free Cash Flow (TTM) 83.40 1.67 6.69 20.51
% Owned Institutions - - - -



Company Industry Sector S&P 500
Dividend Yield 2.94 1.19 1.73 1.60
Dividend Yield – 5 Year Avg. 3.96 1.11 1.29 2.50
Dividend 5 Year Growth Rate 6.50 10.90 5.38 -5.49
Payout Ratio(TTM) 37.13 16.88 11.72 42.50


Growth Rates

Company Industry Sector S&P 500
Sales (MRQ) vs Qtr. 1 Yr. Ago 9.40 33.06 33.44 10.11
Sales (TTM) vs TTM 1 Yr. Ago 19.79 31.39 34.15 10.17
Sales – 5 Yr. Growth Rate 15.45 21.96 13.57 7.34
EPS (MRQ) vs Qtr. 1 Yr. Ago 41.87 80.61 117.83 78.29
EPS (TTM) vs TTM 1 Yr. Ago 39.38 - - -
EPS – 5 Yr. Growth Rate 0.41 19.84 9.23 4.47
Capital Spending – 5 Yr. Growth Rate 4.54 31.57 17.38 3.40

In Bangkok yesterday The Stock Exchange of Thailand (SET) composite index lost 19.79 points or 1.93 percent to close at 1,003.10 points on Tuesday. The trade value was 37.65 billion baht, with 3.39 billion shares traded.

Top five most active values were as follows;

BANPU closed at 744.00 baht, down by 6.00 baht or 0.80 percent.

PTT closed at 338.00 baht, down by 11.00 baht or 3.15 percent.

TOP closed at 80.00 baht, down by 1.00 baht or 1.23 percent.

IVL closed at 49.25 baht, down by 0.75 baht or 1.50 percent.

SCC closed at 328.00 baht, down by 4.00 baht or 1.20 percent.

In Kuala Lumpur yesterday the index lost 11.21 points or 0.75 percent. The market traded within a range of 18.65 points between an intra-day high of 1494.89 and a low of 1476.24 during the session.The Finance Index fell 0.75 percent to 13424.73 points, the Properties Index dropped 2.29 percent to 1029.91 points and the Plantation Index down 1.43 percent to 7554.78 points.

Shayne Heffernan Best Buys today


IOI Corp Bhd, a palm oil player, records a 12.8 percent year-on-year (YoY) in net profit to RM520.2mil for its second quarter ended Dec. 31, 2010 due to better performance of its plantation and property businesses.

Revenue for the period under review was also up by 29.7 percent YoY to RM3.97billion.

According to IOI Corp in its filing to Bursa Malaysia today, the plantation segment reported a 14 percent increase in operating profit to RM363.7mil for the quarter under review as compared to RM319.9 million a year ago.


Malayan Banking Bhd (Maybank) posted a net profit of RM1.13billion, or 15.72 sen per share, for its second quarter ended Dec. 31, 13.7 percent higher than the RM993.5mil, or 14.04 sen per share, reported in the same quarter of 2009 after almost all segments performed better and bad loan provisions were lower.

Revenue for the period stood at RM5.19 bilionl compared with RM4.67 billion a year ago.

The country’s largest bank by assets also declared an interim gross dividend of 28 sen.

Most Active MPAY, SAAG, IRCB-WA, HWGB-WB, IRCB, TANCO, HWGB, AXIATA, PCHEM and BJRTAIL. Trading volume increased to 1452.29 mil shares worth RM2116.51 mil as compared to Monday’s 802.36 mil shares worth RM1179.41 mil.

The Winners were PBBANK (+2 sen to RM12.98), GENM (+1 sen to RM3.33), PETGAS (+2 sen to RM11.26) and BAT (+8 sen to RM45.20).

The Losers were IOICORP (-3 sen to RM5.58), MISC (-24 sen to RM7.42), PETCHEM (-16 sen to RM6.59), MAYBANK (-5 sen to RM8.66) and AXIATA (-4 sen to RM4.73). Market breadth was negative with 126 gainers as compared to 812 losers.

In Singapore the STI was 2.79 percent lower on Tuesday as investors sold fearing further losses from Japan's deadly earthquake and tsunami as well as problems at the country's damaged nuclear facilities.

Breaking 3,000 points support level to 2,946.08, it's the lowest the Straits Times Index (STI) has been since August 2010 and is great value. Best Buys today are:


The culmination of events in the Middle East and the devastating Japan Earthquake have flattened world markets and reduced investor confidence substantially. Shayne Heffernan says, that is the time to be buying.

As Warren Buffett says “Be fearful when others are greedy, and be greedy when others are fearful.”

Buy low, Sell high is the oldest investment cliche. Given the logic is sound, why do people find it hard to do.

Investor Psychology. Two things drive the stock market; fear and greed. Fear is a powerful emotion that causes people to sell investments and seek comfort and safety in cash or gold. There is a lot of fear around today.

Greed is an even more powerful emotion than fear. Fear is temporary, greed is permanent. Greed always overtakes fear. Greed also lulls us into a false sense of security. For most people logic and reason go out the window at both ends of the spectrum.

Buying low and selling high requires you to buy now when the economy is in a panic and fear is rampant, and sell when things are going great and everyone feels giddily happy. Why would you sell when your stocks are going up every week?

Psychologically it is incredibly difficult to buy now when all the news is bad and everyone is in a panic. It is counter to every safety mechanism we have learned since we were born. It is equally difficult to sell when everything is going great.

But, watch what Warren Buffett does. He isn’t buying just any random stock. Buffett buys rock solid companies that are at bargain basement prices in a crisis, then he waits. Investors would be far better off following that lead rather than the short-term trading pattern.

The mood should lighten in Manila after a fall in Tuesday’s session.

Shayne Heffernan Best Buys are

Alliance Global, down 2.0 percent at P11.80 but should rally today.

Energy Development, up 1.6 percent at P6.18 Undervalued at this level.

Aboitiz Equity,up 0.8 percent at P41.35 and has more room to rally.

In Manila yesterday the Philippine Stock Exchange index (PSEi) fell 0.6 percent to 3,896.31, with 102 decliners and 35 advancers while 36 issues were unchanged. Investors feel the index may stay within a 3,850-3,950 range today as the market watches developments in Japan following last week's massive quake.

Expect Jakarta to show some strength today, after the US markets recovered in late trading.

Shayne Heffernan Best Buys

Perusahaan Perkebunan London Sumatra Indonesia, Indonesia's second-largest listed plantation company, lost 3.3 percent to Rp 2,200 yesterday and is undervalued. Bakrie Sumatera Plantations fell 1.4 percent to Rp 345 and is great buying under 370.

Rubber futures declined as August-delivery futures plunged 13 percent to 335 yen per kilogram ($4,097 per ton) in Tokyo yesterday but will stabilize today.

Medco Energi Internasional, Indonesia’s biggest listed oil company, fell 2.6 percent to Rp 2,850 and Energi Mega Persada, the second-largest, lost 2.3 percent to Rp 126 both should have a much better day today.

In Jakarta yesterday the JCI lost 45.36 points, or 1.3 percent, to close at 3,524.48. About 4.1 billion shares worth Rp 5 trillion ($570 million) changed hands, with decliners topping gainers 185 to 36.

The rupiah weakened 0.2 percent to trade at 8,783 to the US dollar at the close on Tuesday, from 8,760 on Monday.



Shayne Heffernan brings more than 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over US$500m and 1 that reach a peak market cap of US$15billion. He has managed and overseen start-ups in Mining, Shipping, Technology and Financial Services.


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This year in Thailand-what next?

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.

The first issue that can’t be answered is the health of Thailand’s beloved King Bhumibol, who is now 83 years old. He is the world's longest reigning monarch, but elaborate birthday celebrations in December failed to mask concern over his health. More

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