Senior Credit Analyst, Lucror Analytics

Leonard Law, CFA

Senior Credit Analyst

High Yield Experts

Lucror Analytics

Lucror Analytics is a leading credit and ESG research specialist and a provider of technology solutions for differentiated fixed income strategies. Our roots are in bottom-up fundamental credit analysis with a specialization in high yield corporate credits from Europe, Asia and Latin America. We are one of few research specialists integrating ESG considerations with fundamental credit research through a dedicated ESG platform. Our ESG assessment covers five key criteria: Disclosure, E,S, & G Pillars, Controversies, ESG Impact on Credit and ESG Momentum.

Recognizing the importance and value-add of Factor Investing in fixed income, Lucror developed the Smart Quant Navigator (SQN), an intuitive platform that helps clients devise and implement factor-based strategies ranging from pure quant to active fundamental, with integrated ESG.

Our company has been at the forefront of developments in the fixed income markets, identifying opportunities and consistently delivering new products and value-adding solutions to clients. Lucror has close relationships with the largest and most reputable asset managers, family offices, hedge funds, investment and wealth managers globally.

Credit

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.<ul><li><a href='#lucror-entity-18561'>JSW Steel Ltd</a></li><li><a href='#lucror-entity-7845'>Road King Infrastructure</a></li><li><a href='#lucror-entity-8898'>Sino Ocean Land</a></li></ul>

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.JSW Steel LtdRoad King InfrastructureSino Ocean Land

Morning Views Asia: JSW Steel Ltd, Road King Infrastructure, Sino Ocean Land

In this month’s “In-Focus” section, we provide an update on recent events in Indonesia that we believe will have an impact on offshore investor confidence. Among these are negative developments at the governmental level regarding the policing of corruption. We also feature a case study on the recent bond default by Delta Merlin Dunia, which highlights the problems inherent in governance with Indonesian corporates, particularly private firms. We believe that at the regulatory and corporate level there is often a capricious approach to governance, which is encouraged by a benign judicial system. The Asia Monthly focuses on providing updates on recent events, information on new issues and spread movements, as well as summarising our top picks and discussing specific areas of interest in the “In-Focus” section. The Asia Monthly is intended to broaden investors' understanding of the Asian USD high-yield market.

  In this month’s “In-Focus” section, we provide an update on recent events in Indonesia that we believe will have an impact on offshore investor confidence. Among these are negative developments at the governmental level regarding the policing of corruption. We also feature a case study on the recent bond default by Delta Merlin Dunia, which highlights the problems inherent in governance with Indonesian corporates, particularly private firms. We believe that at the regulatory and corporate level there is often a capricious approach to governance, which is encouraged by a benign judicial system.   The Asia Monthly focuses on providing updates on recent events, information on new issues and spread movements, as well as summarising our top picks and discussing specific areas of interest in the “In-Focus” section. The Asia Monthly is intended to broaden investors' understanding of the Asian USD high-yield market. 

Asia HY Monthly - Corporate Governance And Corruption In Indonesia - Lucror Analytics

Trung Nguyen

JSW’s Q2/19-20 performance was much weaker than both our expectations and the street consensus, with a large drop in selling prices and profitability. The company was greatly affected by the sharp slowdown in the auto segment, which has been severely impacted by the tight liquidity situation onshore. The financial risk profile has deteriorated significantly, and may have tripped the rating agencies’ negative triggers. We expect the profile to worsen even further. Liquidity is weak. The key risk for JSW is its aggressive expansion plan amid the weak operating environment, both organically as well as via acquisitions, especially the large acquisition of bankrupt Bhushan Power and Steel Ltd (c. INR 19,000 cr). We expect negative pressure on JSW’s ratings in the next one year from both Moody’s and Fitch.

  JSW’s Q2/19-20 performance was much weaker than both our expectations and the street consensus, with a large drop in selling prices and profitability. The company was greatly affected by the sharp slowdown in the auto segment, which has been severely impacted by the tight liquidity situation onshore. The financial risk profile has deteriorated significantly, and may have tripped the rating agencies’ negative triggers. We expect the profile to worsen even further. Liquidity is weak.   The key risk for JSW is its aggressive expansion plan amid the weak operating environment, both organically as well as via acquisitions, especially the large acquisition of bankrupt Bhushan Power and Steel Ltd (c. INR 19,000 cr).   We expect negative pressure on JSW’s ratings in the next one year from both Moody’s and Fitch. 

JSW Steel - Earnings Flash - Q2 FY 2019-20 Results - Lucror Analytics

The Asia HY Trade Recommendations report for October includes a summary of our recommendations, as well as our high-conviction ideas. We also provide relative-value charts and lists of the bonds in the Lucror Asia HY index.

  The Asia HY Trade Recommendations report for October includes a summary of our recommendations, as well as our high-conviction ideas. We also provide relative-value charts and lists of the bonds in the Lucror Asia HY index. 

Asia HY Trade Recommendations - October 2019 - Lucror Analytics

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

Lucror Analytics - Morning Views Asia - 24 Oct 2019

India

Vedanta Limited mines, produces, and exports base metals. The Company mines and distributes metals such as zinc, iron ore, copper, silver, and aluminium, as well as operates power plants. Vedanta markets its products worldwide.

NMDC Limited explores for minerals. The Company is exploring for iron ore, copper, rock phosphate, lime stone, dolomite, gypsum, bentonite, magnesite, diamond, tin, tungsten, graphite, and beach sands.

Jindal Steel & Power Ltd. (JSPL) manufactures sponge iron, mild steel, and cement. The Company also produces power, conducts mining operations for iron ore and coal, and explores for natural gas and oil. JSPL, with its diverse resources, also contributes to the construction of infrastructure.

Hindustan Zinc Limited specializes in the exploration, mining and smelting of zinc, lead and other non-ferrous metals.  The Company's products include zinc ore, lead zinc concentrate, zinc metal, lead metal, cadmium metal, silver metal and sulfuric acid.

Hindalco Industries Limited is an integrated aluminum manufacturer. The Company mines bauxite and refines it into alumina. The Company's other operations include the smelting of alumina into aluminum, the manufacture of semi-fabricated rolled and extruded products. The Company's products include aluminum ingots, steel rods and rolled flat steel products.

National Aluminium Co. Ltd. is an integrated aluminum manufacturer. The Company mines for bauxite, refines bauxite into aluminum and manufactures and sells aluminum and aluminum products. National Aluminium Company's products include bauxite, aluminum hydrate, calcined aluminum, aluminum ingots and aluminum wire rods, as well as electricity which is generated for captive consumption.

Jindal Stainless Ltd. is an integrated steel producer which manufactures a variety of steel products.  The Company's products include stainless steel plates, welded steel tubes, cold rolled strips and seamless tubes. Jindal also manufactures industrial machinery.

Steel Authority of India Limited is an integrated steel manufacturing company. The Company's products include pig iron, steel ingots, liquid steel, alloy steel, special steel, stainless steel, ferro alloys, ERW pipes, spirally welded pipes, and calcium ammonium nitrate.  The Government of India is currently a majority shareholder in the company.

Lloyds Metals and Energy Ltd. manufactures sponge iron.  The Company also operates a cogeneration waste heat recovery plant to recover heat from its kilns.

APL Apollo Tubes Ltd. manufactures and exports galvanized steel tubes, galvanized steel pipes, and welded black pipes and tubes.

United States Steel Corporation operates as an integrated steel producer. The Company manufactures flat-rolled and tubular products with production operations in North America and Europe. United States Steel serves the automotive, appliance, container, industrial machinery, construction, and oil and gas industries.

POSCO Holdings Inc. manufactures and distributes steel products. The Company produces crude steel, hot rolled steel, cold rolled steel, stainless steel, steel plates, wire rods, galvanized steel, electrical steel, and other related products. POSCO Holdings markets its products worldwide.

JFE Holdings, Inc. is a holding company which was established through the merger of NKK Corp and Kawasaki Steel Corp.  The Company manages and conducts its subsidiaries' business, which is steel production and integrated engineering services.

Newcrest Mining Limited is a gold mining, exploration and production company. The Company is geographically focused in Australia, the Pacific region and Asia. Newcrest Mining operates projects within six provinces in four countries, focusing on the Cadia East and Lihir MOPU expansion projects and the Wafi Golpu and Namosi greenfield projects.

Nippon Steel Corp is an integrated steel maker. The Company produces various types of steel products used for industrial machinery & equipment and exports them worldwide.  Nippon Steel provides plant construction and urban development and also develops new businesses such as chemicals, ceramics, electronic equipment and information & communication systems.

China Steel Corporation manufactures and markets a variety of steel products. The main products are hot rolled coils and sheets, cold rolled coils and sheets, wire rods, steel plates, and steel bars.

China Hongqiao Group Ltd. manufactures aluminum products. The Company's aluminum products consist of molten aluminum alloy, aluminum alloy ingots and aluminum busbars.

Baoshan Iron & Steel Co., Ltd. manufactures and markets a variety of iron and steel products including cold rolled plates and coils, hot rolled plates and coils, seamless steel tubes, high-speed wire rods, and steel billets.  The company also operates in related energy production businesses.

Nucor Corporation manufactures steel products.  The Company's products include carbon and alloy steel, steel joists, steel deck, cold finished steel, steel grinding balls, steel bearing products, and metal buildingsystems. Nucor also brokers ferrous and nonferrous metals, pig iron and HBI/DRI; supplies ferro-alloys; and processes ferrous and nonferrous scrap.

Northern Star Resources Ltd manufactures precious metals. The Company provides mining and production of gold. Northern Star Resources serves customers in Australia and North America.

JSW Steel Limited is an integrated steel producer with manufacturing facilities in Karnataka, Tamil Nadu and the western state of Maharashtra. The Company produces products including hot rolled coils, cold rolled coils, wire rods, galvanized coils and sheets.

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JSW Steel Ltd (JSTL IN)

Morning Views Asia: JSW Steel Ltd, Road King Infrastructure, Sino Ocean Land

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region,...

Lucror Analytics

Asia HY Monthly - Corporate Governance And Corruption In Indonesia - Lucror Analytics

In this month’s “In-Focus” section, we provide an update on recent events in Indonesia that we believe will have an impact on offshore investor...

Lucror Analytics

JSW Steel - Earnings Flash - Q2 FY 2019-20 Results - Lucror Analytics

JSW’s Q2/19-20 performance was much weaker than both our expectations and the street consensus, with a large drop in selling prices and...

Lucror Analytics

Asia HY Trade Recommendations - October 2019 - Lucror Analytics

The Asia HY Trade Recommendations report for October includes a summary of our recommendations, as well as our high-conviction ideas. We also...

Lucror Analytics

Lucror Analytics - Morning Views Asia - 24 Oct 2019

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region,...

Lucror Analytics

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