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Macquarie MarQuee Ideas
Adding Woori Finance & monthly update
Switching out of Shinhan Financial Group & removing XL
Axiata, Man Wah and Shree Renuka Sugars
We are adding Woori Finance to our MarQuee Buy Ideas list, replacing Shinhan
Financial as our Korean banking analyst Chan Hwang sees Woori as now best
placed among Korean banking names to play the recovery in the credit cycle.
We are also today removing XL Axiata (Indonesia) as our analyst Riaz Hyder
sees intensifying competition from market leader Telkomsel as a headwind to
ongoing stock outperformance over the next six months. And in the Emerging
Leaders section, Jake Lynch is removing Man Wah, after meeting with
management and lowering his target price, as well as Shree Renuka Sugars.
Full details are inside.
In this report, we also provide a review of our MarQuee list stock performances
and a run down of the changes we have made since our last update in February.
Adding Woori Finance
Today, our Head of Research in Korea, Chan Hwang, in a separate report on the
Korea banking sector, identifies Woori Finance as now best placed to play the
recovery in the credit cycle, and given the macro outlook in Korea and a
stabilising housing market, he believes the stock should start enjoying the
benefits of write-backs soon. He is also upgrading his target price to Won22,000
(from Won21,000) giving 57% upside from current levels.
We’ve removed consumer names but added Tech
Since our last monthly, we have added two Taiwan technology names, TPK
Holdings and Wistron NeWeb, both on the basis that the stocks are attractively
valued and exposed to all the right areas of technology – smartphones, tablets
and the digital home. Full details can be found on pages six and seven
respectively.
Also, since our last MarQuee update, we have removed a number of stocks
whose analysts felt that either the catalyst had passed or the stock was facing
fresh headwinds. Anta Sports is directly exposed to the Asia consumer, and in
an environment in which inflation and the potential for rising interest rates are
dominating themes, our analysts felt there were better returns available
elsewhere. We also removed Air China after Macquarie’s 2011 oil price forecast
was increased, and China Yurun after a competitor’s meat was found to be
contaminated. Finally, we removed BRI as the spike in oil prices and domestic
inflation led to a surprise increase in Indonesian interest rates.
Performance Review
Stocks on the MarQuee list have endured a volatile few weeks as first, fears of
inflation and interest rates rises and then the earthquake and tsunami in Japan
played on investors’ fears. That said, we have seen some impressive returns
from Thai stocks Kasikornbank and Supalai as well as a recovery in India
names Reliance Industries and Jindal Steel & Power. On the downside,
Japan names have clearly been under pressure, although with the exception of
Elpida Memory, our top picks have performed in line.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Macquarie MarQuee Ideas
Adding Woori Finance & monthly update
Switching out of Shinhan Financial Group & removing XL
Axiata, Man Wah and Shree Renuka Sugars
We are adding Woori Finance to our MarQuee Buy Ideas list, replacing Shinhan
Financial as our Korean banking analyst Chan Hwang sees Woori as now best
placed among Korean banking names to play the recovery in the credit cycle.
We are also today removing XL Axiata (Indonesia) as our analyst Riaz Hyder
sees intensifying competition from market leader Telkomsel as a headwind to
ongoing stock outperformance over the next six months. And in the Emerging
Leaders section, Jake Lynch is removing Man Wah, after meeting with
management and lowering his target price, as well as Shree Renuka Sugars.
Full details are inside.
In this report, we also provide a review of our MarQuee list stock performances
and a run down of the changes we have made since our last update in February.
Adding Woori Finance
Today, our Head of Research in Korea, Chan Hwang, in a separate report on the
Korea banking sector, identifies Woori Finance as now best placed to play the
recovery in the credit cycle, and given the macro outlook in Korea and a
stabilising housing market, he believes the stock should start enjoying the
benefits of write-backs soon. He is also upgrading his target price to Won22,000
(from Won21,000) giving 57% upside from current levels.
We’ve removed consumer names but added Tech
Since our last monthly, we have added two Taiwan technology names, TPK
Holdings and Wistron NeWeb, both on the basis that the stocks are attractively
valued and exposed to all the right areas of technology – smartphones, tablets
and the digital home. Full details can be found on pages six and seven
respectively.
Also, since our last MarQuee update, we have removed a number of stocks
whose analysts felt that either the catalyst had passed or the stock was facing
fresh headwinds. Anta Sports is directly exposed to the Asia consumer, and in
an environment in which inflation and the potential for rising interest rates are
dominating themes, our analysts felt there were better returns available
elsewhere. We also removed Air China after Macquarie’s 2011 oil price forecast
was increased, and China Yurun after a competitor’s meat was found to be
contaminated. Finally, we removed BRI as the spike in oil prices and domestic
inflation led to a surprise increase in Indonesian interest rates.
Performance Review
Stocks on the MarQuee list have endured a volatile few weeks as first, fears of
inflation and interest rates rises and then the earthquake and tsunami in Japan
played on investors’ fears. That said, we have seen some impressive returns
from Thai stocks Kasikornbank and Supalai as well as a recovery in India
names Reliance Industries and Jindal Steel & Power. On the downside,
Japan names have clearly been under pressure, although with the exception of
Elpida Memory, our top picks have performed in line.
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