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.

High Yield Experts

Credit Analyst, Lucror Analytics

Chuanyi Zhou

Credit Analyst

Credit

In our view, China South City’s H1/18-19 operating results were decent. CSC has been increasingly relying on residential-property sales, owing to its development cycle and the weak demand for trade centres. Recurring income has been gradually growing, on the back of the large investment-property portfolio and management/logistics services. CSC's margins have been above-average for years, although we believe its profitability advantage may diminish as land costs rise and residential-property contributions increase. Our key concern on CSC is refinancing risk. The company is heavily reliant on debt financing on account of its capital-intensive business model, and the credit environment, whether onshore and offshore, has been challenging, especially for developers. The USD 2Y Notes of May and June were issued with a coupon of 10.875%, far higher than that of the 3Y Notes issued in January (7.25%). Even then, two tranches of the high-coupon Notes were issued, with aggregate principal of USD 250 mn. CSC noted that it will likely use MTN and ABS onshore for refinancing. We now change our recommendation to "Speculative Buy" on CSCHCN 5.75 '20s for c.23% yield mainly due to poor technical after the Wuzhou default.

   In our view, China South City’s H1/18-19 operating results were decent. CSC has been increasingly relying on residential-property sales, owing to its development cycle and the weak demand for trade centres. Recurring income has been gradually growing, on the back of the large investment-property portfolio and management/logistics services. CSC's margins have been above-average for years, although we believe its profitability advantage may diminish as land costs rise and residential-property contributions increase.    Our key concern on CSC is refinancing risk. The company is heavily reliant on debt financing on account of its capital-intensive business model, and the credit environment, whether onshore and offshore, has been challenging, especially for developers. The USD 2Y Notes of May and June were issued with a coupon of 10.875%, far higher than that of the 3Y Notes issued in January (7.25%). Even then, two tranches of the high-coupon Notes were issued, with aggregate principal of USD 250 mn. CSC noted that it will likely use MTN and ABS onshore for refinancing.    We now change our recommendation to "Speculative Buy" on CSCHCN 5.75 '20s for c.23% yield mainly due to poor technical after the Wuzhou default. 

China South City - Earnings Flash - H1 FY 2018-19 Results - Lucror Analytics