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

Yuexiu Real Estate Investment Trust / 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-1457'>China Oil And Gas</a></li><li><a href='#lucror-entity-173'>First Pacific Co</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 Oil And GasFirst Pacific Co

Morning Views Asia: China Oil And Gas, First Pacific Co

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-13359'>Lenovo</a></li><li><a href='#lucror-entity-40676'>Citicore Renewable Energy</a></li><li><a href='#lucror-entity-22202'>Vedanta Resources</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.LenovoCiticore Renewable EnergyVedanta Resources

Morning Views Asia: Lenovo, Citicore Renewable Energy, Vedanta Resources

Yuexiu REIT's FY 2023 results were acceptable in our view, as earnings from its hotels and retail assets recovered y-o-y on the back of China's resumption of economic activities following the pandemic. This was partly offset by lower earnings from its office buildings. The overall portfolio occupancy rate improved in H2, but was down marginally amid weakness in the office segment. Net debt decreased in H2, but was largely stable. Positively, the portfolio asset valuation was largely unchanged at CNY 42.6 bn. That said, the financial profile remains moderately weak. We view refinancing risk as manageable, considering Yuexiu REIT's healthy access to funding and large proportion of unencumbered assets. It will likely continue refinancing offshore floating-rate debt with onshore fixed-rate borrowings, which could help stem FX losses and lower interest costs. We revise our fundamental Credit Bias to "Stable" from "Negative", and move our trade recommendation to "Buy" from "Hold" on the YXREIT 2.65 '26s.

  Yuexiu REIT's FY 2023 results were acceptable in our view, as earnings from its hotels and retail assets recovered y-o-y on the back of China's resumption of economic activities following the pandemic. This was partly offset by lower earnings from its office buildings. The overall portfolio occupancy rate improved in H2, but was down marginally amid weakness in the office segment. Net debt decreased in H2, but was largely stable. Positively, the portfolio asset valuation was largely unchanged at CNY 42.6 bn. That said, the financial profile remains moderately weak.   We view refinancing risk as manageable, considering Yuexiu REIT's healthy access to funding and large proportion of unencumbered assets. It will likely continue refinancing offshore floating-rate debt with onshore fixed-rate borrowings, which could help stem FX losses and lower interest costs.   We revise our fundamental Credit Bias to "Stable" from "Negative", and move our trade recommendation to "Buy" from "Hold" on the YXREIT 2.65 '26s.  

Yuexiu REIT - Earnings Flash - FY 2023 Results - Lucror Analytics

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Event-Driven

<ul>
<li>Bloomberg <a href="https://news.bloomberglaw.com/mergers-and-acquisitions/esr-bidders-said-to-weigh-bringing-in-more-investors-for-buyout" target="_blank" rel="noopener">reports</a> that the bidding consortium is in talks to bring in other partners, such as QIA, PIF, and CPP Investment Board, to aid in privatising <a href="https://www.smartkarma.com/entities/esr-group-ltd" target="_blank" data-smartkarma-citation="entities:27983:1" rel="noopener">ESR Group (1821 HK)</a>.</li>
<li>Warburg Pincus and OMERS have blocking stakes for a Cayman scheme. Warburg Pincus is seemingly supportive, and the consortium’s expansion talks suggest confidence in meeting OMERS’ price expectations.</li>
<li>Our best guess is that an offer is around HK$14.00. ESR’s current valuation is undemanding, with its forward EV/EBITDA multiple at a 40% discount compared to the median peers’ multiple.</li>
</ul>


Bloomberg reports that the bidding consortium is in talks to bring in other partners, such as QIA, PIF, and CPP Investment Board, to aid in privatising ESR Group (1821 HK).
Warburg Pincus and OMERS have blocking stakes for a Cayman scheme. Warburg Pincus is seemingly supportive, and the consortium’s expansion talks suggest confidence in meeting OMERS’ price expectations.
Our best guess is that an offer is around HK$14.00. ESR’s current valuation is undemanding, with its forward EV/EBITDA multiple at a 40% discount compared to the median peers’ multiple.


ESR Group (1821 HK): Consortium’s Expansion Talks Suggest Progress

Hong Kong

Yuexiu Real Estate Investment Trust invests in a diverse portfolio of income producing properties which are used primarily for office, retail, and other commercial purposes in China.

Yuexiu Real Estate Investment Trust (405 HK)

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Yuexiu Real Estate Investment Trust (405 HK)

Morning Views Asia: China Oil And Gas, First Pacific Co

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

Lucror Analytics

Morning Views Asia: Lenovo, Citicore Renewable Energy, Vedanta Resources

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

Lucror Analytics

Morning Views Asia: Lenovo, Citicore Renewable Energy, Vedanta Resources

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

Lucror Analytics

Yuexiu REIT - Earnings Flash - FY 2023 Results - Lucror Analytics

Yuexiu REIT's FY 2023 results were acceptable in our view, as earnings from its hotels and retail assets recovered y-o-y on the back of China's...

Lucror Analytics

ESR Group (1821 HK): Consortium’s Expansion Talks Suggest Progress

The probability of an offer remains high, and the latest Bloomberg reports suggest progress towards a binding proposal. Our best guess is that an...

Arun George

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