China Macroeconomics & Academia

Christopher Balding

Thematic (Sector/Industry)

Given the recent run up in Chinese steel prices and the stock prices of producers, it is fair to ask is this being driven by increased demand for products with the coming building season and potential stimulus or by traders. All evidence points to the idea that steel price increases are driven by traders and not underlying activity. This appears to create excellent opportunity for a short play in the commodity sector and Hong Kong listed Chinese steel producers. Both steel and coal output and…

Given the recent run up in Chinese steel prices and the stock prices of producers, it is fair to ask is this being driven by increased demand for products with the coming building season and potential stimulus or by traders. All evidence points to the idea that steel price increases are driven by traders and not underlying activity. This appears to create excellent opportunity for a short play in the commodity sector and Hong Kong listed Chinese steel producers. Both steel and coal output and…

Macroeconomics

Chinese economic activity appears to be stabilizing in April.  We are not witnessing a pullback from the expansion in the real economy we saw post Chinese New Year in March but nor are we witnessing continued expansion.  Given the explosion in credit, the relative lack of continued expansion should be cause for concern.

Chinese economic activity appears to be stabilizing in April.  We are not witnessing a pullback from the expansion in the real economy we saw post Chinese New Year in March but nor are we witnessing continued expansion.  Given the explosion in credit, the relative lack of continued expansion should be cause for concern.

Chinese Flash Numbers Fail to Build on Post-New Year Bounce

Equity Research Analyst, Maritime sector, Drewry Maritime Financial Research

Ankush Kathuria CFA, FRM

Equity Research Analyst, Maritime sector

Maritime Sector, Equity & Credit Research

Drewry Maritime Financial Research

With no ties to other players in the shipping, finance or banking world, we provide a uniquely impartial view of the markets and companies we cover. Our parent organization, Drewry is a leading independent provider of research services to the maritime and shipping industry, employing over 100 professionals across an international network of offices in London, Delhi, Singapore and Shanghai. Combining our market-leading resources with seasoned sector expertise DFRS offers a highly differentiated and comprehensive range of investment and financial research services to lenders and prospective investors in publicly listed maritime and shipping companies. The full service of reports, supporting resources and sector orientated webinars provides our clients with the most complete picture of the organisations under coverage as is possible. We have been charting and analysing the world’s maritime markets for more than 40 years. This unrivalled intelligence and understanding provides the foundation of our research service. Our analysts have access to one of the most up-to-date, comprehensive and reliable sources of market insight and research data available today. We look at globally listed companies within the following sectors: Port Operators, Container Shipping, Container Manufacturing & Leasing, LNG Shipping, Dry Bulk Shipping and Tanker Shipping. Combine in-depth sector expertise with financial analysis focusing on over 50 stocks globally.

Last year saw a record amount of container-ship capacity hit the water. We take a look at which operators accepted delivery and which trades they deployed them in. Record delieveries, record maximum ship size.  Last year was full of records in the container shipping industry, but unfortunately for carriers they were mostly of the unwanted variety. One such record (made by bad by virtue of the second worst ever demand growth) was a record intake of new ships. There were 209 new ships that hit the…

Last year saw a record amount of container-ship capacity hit the water. We take a look at which operators accepted delivery and which trades they deployed them in. Record delieveries, record maximum ship size.  Last year was full of records in the container shipping industry, but unfortunately for carriers they were mostly of the unwanted variety. One such record (made by bad by virtue of the second worst ever demand growth) was a record intake of new ships. There were 209 new ships that hit the…

Container Shipping - 2015 Full of Records, Big Ships, Super Size Me and It Ain't Over Yet

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

The Baltic Dry Index - once a quaint indicator for shipping sector wonks to figure out expected marginal profitability of shippers who ran a greater or lesser portion of their fleet on spot rather than term charter or long-term lease - is now used by stock punters as "evidence" of dynamic demand for shipping services for commodities, and therefore underlying economic pull demand from the secondary sector (heavy and light industry), particularly in China. The big news is that it has bounced 105%…

The Baltic Dry Index - once a quaint indicator for shipping sector wonks to figure out expected marginal profitability of shippers who ran a greater or lesser portion of their fleet on spot rather than term charter or long-term lease - is now used by stock punters as "evidence" of dynamic demand for shipping services for commodities, and therefore underlying economic pull demand from the secondary sector (heavy and light industry), particularly in China. The big news is that it has bounced 105%…

Baltic Dry: 30yrs of Stats Tells You The Bounce You Now See Is Seasonal. Again.

David Blennerhassett

Quiddity Advisors

Event-Driven

<ul>
<li>The correct long-term thing to do is, and the right short-term trade don't match. Best to sell <a href="https://www.smartkarma.com/entities/mcj-co-ltd" target="_blank" data-smartkarma-citation="entities:14132:1" rel="noopener">MCJ (6670 JP)</a> above the tender offer price or at the offer price.</li>
<li>At 6.1x forward EV/EBITDA - and ~80% discount to NAV - <a href="https://www.smartkarma.com/entities/avichina-industry-technology-h" target="_blank" data-smartkarma-citation="entities:16315:1" rel="noopener">AviChina Industry &amp; Technology H (2357 HK)</a> is not expensive.</li>
<li>An interesting fact pattern appears like it might be a setup for a significant change in capital structure for <a href="https://www.smartkarma.com/entities/tokyo-steel-mfg-co-ltd" target="_blank" data-smartkarma-citation="entities:16195:1" rel="noopener">Tokyo Steel Mfg (5423 JP) T</a> related to the former CEO</li>
</ul>


The correct long-term thing to do is, and the right short-term trade don't match. Best to sell MCJ (6670 JP) above the tender offer price or at the offer price.
At 6.1x forward EV/EBITDA - and ~80% discount to NAV - AviChina Industry &amp; Technology H (2357 HK) is not expensive.
An interesting fact pattern appears like it might be a setup for a significant change in capital structure for Tokyo Steel Mfg (5423 JP) T related to the former CEO


Last Week In Event SPACE: MCJ, AviChina, Tokyo Steel Mfg, 3SBio

China

AviChina Industry & Technology Co., Ltd. engages in the research, development, manufacture, and sale of civil aviation products. The company operates through segments including Aviation Entire Aircraft, Aviation Ancillary System and Related Business, and Aviation Engineering Services, offering products such as helicopters, trainer aircraft, regional jets, and aero-parts. It was founded on April 30, 2003, and is headquartered in Beijing, China.

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AviChina Industry & Technology (2357 HK)

The Future of Chinese Steel Prices

Given the recent run up in Chinese steel prices and the stock prices of producers, it is fair to ask is this being driven by increased demand for...

Christopher Balding

Chinese Flash Numbers Fail to Build on Post-New Year Bounce

Chinese economic activity appears to be stabilizing in April. We are not witnessing a pullback from the expansion in the real economy we saw post...

Christopher Balding

Container Shipping - 2015 Full of Records, Big Ships, Super Size Me and It Ain't Over Yet

Last year saw a record amount of container-ship capacity hit the water. We take a look at which operators accepted delivery and which trades they...

Drewry Maritime Financial Research

Baltic Dry: 30yrs of Stats Tells You The Bounce You Now See Is Seasonal. Again.

The Baltic Dry Index - once a quaint indicator for shipping sector wonks to figure out expected marginal profitability of shippers who ran a...

Travis Lundy

Last Week In Event SPACE: MCJ, AviChina, Tokyo Steel Mfg, 3SBio

It’s Sunday! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed during the...

David Blennerhassett

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