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 discuss variable interest entities (VIEs) in China, including recent developments in China and the US that may complicate the future use of VIEs. We also give an overview of recent bond defaults. 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 discuss variable interest entities (VIEs) in China, including recent developments in China and the US that may complicate the future use of VIEs. We also give an overview of recent bond defaults.   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 Variable Interest Entities - Lucror Analytics

Credit Analyst, Lucror Analytics

Chuanyi Zhou

Credit Analyst

Powerlong's H1/21 results were in line with our expectations, with good revenue growth and strong profitability. Contracted sales have been promising. The company's gross profit margin remains stronger than most peers, and we believe Powerlong will maintain its edge in terms of profitability. While gross debt increased, it was still within the limit set by the Three Red Lines thresholds. Notably, the company's land purchases were aggressive, exceeding the 40% threshold set by the regulator this year. This would limit Powerlong's pace of expansion in H2/21. Credit metrics improved marginally on the back of stronger operating results, and the liquidity profile remains sound.

  Powerlong's H1/21 results were in line with our expectations, with good revenue growth and strong profitability. Contracted sales have been promising. The company's gross profit margin remains stronger than most peers, and we believe Powerlong will maintain its edge in terms of profitability.   While gross debt increased, it was still within the limit set by the Three Red Lines thresholds. Notably, the company's land purchases were aggressive, exceeding the 40% threshold set by the regulator this year. This would limit Powerlong's pace of expansion in H2/21. Credit metrics improved marginally on the back of stronger operating results, and the liquidity profile remains sound.     

Powerlong - Earnings Flash - H1 FY 2021 Results - Lucror Analytics

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Quantitative Analysis

The property sector in China has been in the spotlight over the last few years. Regulators have made various attempts to temper price growth but the silver bullet has been elusive so far.The powers that be realise that the lack of affordable housing is one of the reasons for China's birth rate dropping and there is now a renewed effort to ensure that property prices do not continue to run up. As part of the measures that started with the 'Three Red Lines' almost a year ago, Bloomberg reports that China has halted PE funds from raising money to invest in residential property developments.We take a look at some of the regulatory changes that have been implemented over the last year and see how the companies in the sector are faring. We then look for stocks with similar characteristics but different stock returns over the last year to find trade opportunities.

The property sector in China has been in the spotlight over the last few years. Regulators have made various attempts to temper price growth but the silver bullet has been elusive so far.The powers that be realise that the lack of affordable housing is one of the reasons for China's birth rate dropping and there is now a renewed effort to ensure that property prices do not continue to run up. As part of the measures that started with the 'Three Red Lines' almost a year ago, Bloomberg reports that China has halted PE funds from raising money to invest in residential property developments.We take a look at some of the regulatory changes that have been implemented over the last year and see how the companies in the sector are faring. We then look for stocks with similar characteristics but different stock returns over the last year to find trade opportunities.

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-6159'>China SCE</a></li><li><a href='#lucror-entity-13359'>Lenovo</a></li><li><a href='#lucror-entity-28672'>Powerlong Commercial Management Holdings</a></li><li><a href='#lucror-entity-31037'>Sino-Ocean Service</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.China SCELenovoPowerlong Commercial Management HoldingsSino-Ocean Service

Morning Views Asia: China SCE, Lenovo, Powerlong Commercial Management Holdings, Sino-Ocean Service

In this month’s "In-Focus" section, we discuss Chinese developers’ urban redevelopment businesses, including local governments' role in urban renewal projects and the various redevelopment models, as well as the impact of such projects on companies' financials. We also give an overview of recent bond defaults. 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 discuss Chinese developers’ urban redevelopment businesses, including local governments' role in urban renewal projects and the various redevelopment models, as well as the impact of such projects on companies' financials. We also give an overview of recent bond defaults.   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 Developers’ Urban Redevelopment Businesses - Lucror Analytics

China

Powerlong Real Estate Holdings Ltd. develops commercial properties in the Peoples Republic of China.

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Powerlong Real Estate Holdings (1238 HK)

Asia HY Monthly - Chinese Variable Interest Entities - Lucror Analytics

In this month’s "In-Focus" section, we discuss variable interest entities (VIEs) in China, including recent developments in China and the US that...

Lucror Analytics

Powerlong - Earnings Flash - H1 FY 2021 Results - Lucror Analytics

Powerlong's H1/21 results were in line with our expectations, with good revenue growth and strong profitability. Contracted sales have been...

Lucror Analytics

China Property Sector: Trading Ideas

The China property sector has been in the regulatory crosshairs and new rules continue to be rolled out. We look for trading opportunities in the...

Brian Freitas

Morning Views Asia: China SCE, Lenovo, Powerlong Commercial Management Holdings, Sino-Ocean Service

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 - Chinese Developers’ Urban Redevelopment Businesses - Lucror Analytics

In this month’s "In-Focus" section, we discuss Chinese developers’ urban redevelopment businesses, including local governments' role in urban...

Lucror Analytics

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