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

In this month’s “In-Focus” section, we provide an update on the Chinese property sector, including trends in contracted sales and operations, as well as regulatory developments. 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 the Chinese property sector, including trends in contracted sales and operations, as well as regulatory developments.    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 - Chinese Property Update - Lucror Analytics

The Asia HY Trade Recommendations report for August 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 August 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 - August 2019 - Lucror Analytics

Medco Energi's H1/19 results were satisfactory. Earnings continued to grow on higher O&G production volumes. While the company reported a lower average realised oil price, we note that the average realised gas price is higher y-o-y, as the bulk of its gas contracts are based on fixed prices or indexed prices with annual escalations. The weaker leverage was in line with expectations, as the additional debt was mainly used to fund the Ophir acquisition. We project that full-year Debt/EBITDA will improve to c. 5x (LTM June 2019: 5.6x). We also expect FCF to remain negative over the near term, on account of the high capex. That said, cash flow will be supplemented by the company’s non-core asset disposals. Medco may also embark on further acquisitions, considering its relatively short 2P reserve life of nine years. Although the company has ample 2C reserves, these are unproven and will require exploration capex.

   Medco Energi's H1/19 results were satisfactory. Earnings continued to grow on higher O&G production volumes. While the company reported a lower average realised oil price, we note that the average realised gas price is higher y-o-y, as the bulk of its gas contracts are based on fixed prices or indexed prices with annual escalations.    The weaker leverage was in line with expectations, as the additional debt was mainly used to fund the Ophir acquisition. We project that full-year Debt/EBITDA will improve to c. 5x (LTM June 2019: 5.6x). We also expect FCF to remain negative over the near term, on account of the high capex. That said, cash flow will be supplemented by the company’s non-core asset disposals. Medco may also embark on further acquisitions, considering its relatively short 2P reserve life of nine years. Although the company has ample 2C reserves, these are unproven and will require exploration capex. 

Medco Energi - Earnings Flash - H1 FY 2019 Results - 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 - 05 Aug 2019

In this month’s “In-Focus” section, we provide an update on the Indonesian real estate sector, including the background of the last cycle, sales trends, regulatory actions and expectations. We also comment broadly on the FY 2018 and Q1/19 results of real estate companies under our coverage.

   In this month’s “In-Focus” section, we provide an update on the Indonesian real estate sector, including the background of the last cycle, sales trends, regulatory actions and expectations. We also comment broadly on the FY 2018 and Q1/19 results of real estate companies under our coverage. 

Asia HY Monthly - Indonesian Property Update (2019) - Lucror Analytics

Indonesia

PT Medco Energi Internasional Tbk is an integrated energy company. The Company explores for and produces oil and gas both in Indonesia and internationally, operates gas-fired power plants in Panaran I, Batam Island, and develops renewable fuels such as Bio-fuel.

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Medco Energi (MEDC IJ)

Asia HY Monthly - Chinese Property Update - Lucror Analytics

In this month’s “In-Focus” section, we provide an update on the Chinese property sector, including trends in contracted sales and operations, as...

Lucror Analytics

Asia HY Trade Recommendations - August 2019 - Lucror Analytics

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

Lucror Analytics

Medco Energi - Earnings Flash - H1 FY 2019 Results - Lucror Analytics

Medco Energi's H1/19 results were satisfactory. Earnings continued to grow on higher O&G production volumes. While the company reported a...

Lucror Analytics

Lucror Analytics - Morning Views Asia - 05 Aug 2019

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 - Indonesian Property Update (2019) - Lucror Analytics

In this month’s “In-Focus” section, we provide an update on the Indonesian real estate sector, including the background of the last cycle, sales...

Lucror Analytics

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