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.

• Greentown China
• NagaCorp Ltd
• Vedanta Resources
• Yuexiu Property

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.

• Road King Infrastructure
• Samvardhana Motherson International Ltd
• Vedanta Resources

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.

• Nickel Industries
• Samvardhana Motherson International Ltd

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 Vanke
• Lippo Malls Indonesia Retail Trust

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.

• Health And Happiness (H&H)

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 Water Affairs
• Health And Happiness (H&H)

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.

• Adani Ports & Special Economic Zone
• Bharti Airtel
• Lippo Malls Indonesia Retail Trust
• Vedanta Resources

Softbank Group (SBG) has launched a four-part benchmark-sized bond offering comprising USD and EUR notes. The proceeds will mainly be used for debt repayment, including the redemption of foreign currency-denominated bonds, as well as for general corporate purposes, including the maintenance of a cash position for the redemption of outstanding notes due over the next two years along with new investments. In particular, SBG will redeem its USD 766.8 mn 4.75% 2024 bonds (due September) early at par.

• As we are entering the second half of 2024, inflation has remained sticky as expected.
• The lingering fear of a global recession has been mitigating rising shipping and production costs and, as a result, kept inflation in check.
• We see more opportunities in selected Chinese bonds in industries away from property and local government financing vehicle (LGFV) sectors and believe non-Asia emerging bonds offer better value.

We view New World Development (NWD) as “Medium Risk” on the LARA scale. The company is one of the leading Hong Kong-based property developers and the flagship real estate arm of the Chow Tai Fook (CTF) group. NWD has an established property-development track record in Hong Kong and Mainland China, as well as a sizeable and growing portfolio of investment properties (under the premium K11 brand) in both regions. In addition, it has a large land bank (particularly in Hong Kong), which would support its development pipeline.

Overall, we believe NWD’s credit profile is underpinned by expectation of support from the CTF group, as well as its high quality and mostly unencumbered investment property portfolio. That said, the company has high leverage and weak financial metrics.

Our fundamental Credit Bias on NWD is “Negative”. This is mainly on account of the challenging industry environment, which has pressured the company’s property development contracted sales and margins. Going forward, NWD is likely to gradually grow its rental income from investment properties, supported by contributions from newly completed assets. Positively, management has communicated a deleveraging plan, albeit this may hinge on the company’s ability to carry out further non-core asset disposals.  

Controversies are “Immaterial”. In 2021, NWD had to demolish and rebuild two out of seven blocks at The Pavilia Farm Phase 3 project, after the building contractor found construction defects during concrete strength tests. That said, the company adequately compensated affected homebuyers and commissioned an independent third party to carry out tests on the project’s Phase 1 and 2 sections. In 2008, NWD became the subject of a minor controversy after it appointed a former top civil servant (Leung Chin-man, who was Hong Kong’s Permanent Secretary for Housing, Planning and Lands from 2002 to 2005) as deputy MD and ED of NWCL. The appointment was subsequently rescinded after a public outcry. Overall, the ESG Impact on Credit is “Neutral”. 

We initiate coverage on NWD with a “Hold” recommendation on the NWDEVL notes. We believe investors with a higher risk appetite can consider investing in the three NWDEVL perpetual securities that contain coupon step-ups (in the event of non-call at their respective first call dates), considering the attractive YTC. 

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.

• Medco Energi

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.

• Softbank Group

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.

• Softbank Group

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.

• Greentown China