Asian Insight Provider - Actionable ideas, CrossASEAN Research

Henry Soediarko

Asian Insight Provider - Actionable ideas

Thematic (Sector/Industry)

Is there really a value in the aircraft leasing business? Or is just the hype of market expectation? This report aims to give a more detailed and comprehensive explanation in the aircraft leasing business model which is more of an investment management business rather than transport related business. Air travel is still the only way to do cross-continental travel hence benefiting from the increasing middle class, especially in the emerging economies.

Is there really a value in the aircraft leasing business? Or is just the hype of market expectation? This report aims to give a more detailed and comprehensive explanation in the aircraft leasing business model which is more of an investment management business rather than transport related business. Air travel is still the only way to do cross-continental travel hence benefiting from the increasing middle class, especially in the emerging economies. 

Aircraft Leasing Companies: Boring Business?

Independent Asian Credit Research, Bondcritic

Warut Promboon

Independent Asian Credit Research

Asian Fixed Income/Frontier Market Research

Bondcritic

Bondcritic, established in 2009, is designed to be an independent credit research voice that helps investors gain insights and unbiased analyses on Asian fixed income market. Our mission is to discover deep-value Asian high-yield and distressed bonds with a bottom-up approach, together with the help of our proprietary ESG (Environmental, Social Development, and Governance) model. At the same time, we focus on bringing investment cases of unrated and unloved issuers to the general public.

Credit

In <a href="https://www.smartkarma.com/insights/asian-credit-monitor-china-s-onshore-bonds-part-i-the-normandy" target="_blank" data-smartkarma-citation="insights:10216">Asian Credit Monitor: China’s Onshore Bonds (Part I: The Normandy)</a>, we highlighted the access and motivations for investing in China's onshore bonds. In Part II, we aim at a sequel that explains risks of investing in China's onshore bonds, hence the title of this report. At the end of the day, we believe there are a lot of naked swimmers among Chinese onshore bond issuers and, as Warren Buffett once said,  "Only when the tides go out do you discover who has been swimming naked".We need to stress that Bond Connect gives investors access, not a hedge, and the idiosyncratic risk of investing in China remains unchanged. That said, China's onshore bond investment is not for the faint of heart, especially if anyone intends to invest outside Chinese government bonds, Chinese policy bank bonds and top 4 commercial banks as we mentioned in Part I. We remain positive on China's onshore bond market in the long term but we also believe the onshore bond market is not the place for risky bonds.

In Asian Credit Monitor: China’s Onshore Bonds (Part I: The Normandy), we highlighted the access and motivations for investing in China's onshore bonds. In Part II, we aim at a sequel that explains risks of investing in China's onshore bonds, hence the title of this report. At the end of the day, we believe there are a lot of naked swimmers among Chinese onshore bond issuers and, as Warren Buffett once said,  "Only when the tides go out do you discover who has been swimming naked".We need to stress that Bond Connect gives investors access, not a hedge, and the idiosyncratic risk of investing in China remains unchanged. That said, China's onshore bond investment is not for the faint of heart, especially if anyone intends to invest outside Chinese government bonds, Chinese policy bank bonds and top 4 commercial banks as we mentioned in Part I. We remain positive on China's onshore bond market in the long term but we also believe the onshore bond market is not the place for risky bonds.

Asian Credit Monitor: China's Onshore Bonds (Part II: Omaha Beach)

Asia Ex-J Consumer/ Transport analyst

Valerie Law, CFA

Extending my point about more demanding transportation frameworks going forward (see <a href="https://www.smartkarma.com/insights/comfortdelgro-fy16-results-an-era-where-competition-hits-a-higher-gear" target="_blank" data-smartkarma-citation="insights:8719">ComfortDelGro FY16 Results: An Era Where Competition Hits a Higher Gear</a> ), the recent fire-bomb attack on Hong Kong’s MTR that left 19 injured signals increasing costs for transport operators. This article presents another reason why investors should sell MTR Corp, on top of points already provided by fellow insight provider Sameer Taneja in an earlier piece <a href="https://www.smartkarma.com/insights/mtr-66-hk-conviction-sell-thesis" target="_blank" data-smartkarma-citation="insights:7982">MTR (66 HK): Conviction Sell Thesis</a><h2>Security Costs to</h2>…

Extending my point about more demanding transportation frameworks going forward (see ComfortDelGro FY16 Results: An Era Where Competition Hits a Higher Gear ), the recent fire-bomb attack on Hong Kong’s MTR that left 19 injured signals increasing costs for transport operators. This article presents another reason why investors should sell MTR Corp, on top of points already provided by fellow insight provider Sameer Taneja in an earlier piece MTR (66 HK): Conviction Sell ThesisSecurity Costs to…

66 HK and SBUS SP: Attack on HK Metro Signals Increases in Transport Operators' Costs

The accounting research firm, GMT Research

Lisa Mangkornkarn

The accounting research firm

GMT Research

GMT Research provides independent insight into markets, sectors and companies throughout Asia. Our unique method of mining a comprehensive collection of corporate financial statements for key data allows us to evaluate the financial health of a company, sectors and the market at large. We also investigate the application of accounting standards by companies and sectors, shedding light on the quality of reported profits. Armed with this information, we help investment professionals navigate the financial landscape.

China Aircraft Leasing Group Holdings / ESG

Don’t be tempted to buy into aircraft leasing businesses despite the recent flurry of IPOs. It is a bad industry and the only stocks to trade above book value are those with creative accounting or government subsidies. The prospect of rising interest rates and low oil prices means that the aircraft leasing cycle is turning down. This explains why everyone is trying to offload these assets. We think <a href="https://www.smartkarma.com/entities/9844" target="_blank" data-smartkarma-citation="entities:9844:1">China Aircraft Leasing Group Holdings Ltd (1848 HK)</a> might not survive the cycle. Don’t be left holding the baby.

Don’t be tempted to buy into aircraft leasing businesses despite the recent flurry of IPOs. It is a bad industry and the only stocks to trade above book value are those with creative accounting or government subsidies. The prospect of rising interest rates and low oil prices means that the aircraft leasing cycle is turning down. This explains why everyone is trying to offload these assets. We think China Aircraft Leasing Group Holdings Ltd (1848 HK) might not survive the cycle. Don’t be left holding the baby.

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.

In our update yesterday, <a href="https://www.smartkarma.com/insights/dmer-chinese-port-operators-avoid-bottom-fishing-in-troubled-waters," target="_blank">https://www.smartkarma.com/insights/dmer-chinese-port-operators-avoid-bottom-fishing-in-troubled-waters,</a> we looked at the Chinese port on macro basis. We had cautioned against bottom-fishing based on past valuation multiples. Investors are more likely to pick up Chinese port operators with greater unrewarded risks than for the port companies overseas.In this update we highlight that there are little signs of green shoots for mainland Chinese operators with laggard throughput growth across the three economic regions: Pearl River Delta, Yangtze River Delta and Bohai Rim.

In our update yesterday, https://www.smartkarma.com/insights/dmer-chinese-port-operators-avoid-bottom-fishing-in-troubled-waters, we looked at the Chinese port on macro basis. We had cautioned against bottom-fishing based on past valuation multiples. Investors are more likely to pick up Chinese port operators with greater unrewarded risks than for the port companies overseas.In this update we highlight that there are little signs of green shoots for mainland Chinese operators with laggard throughput growth across the three economic regions: Pearl River Delta, Yangtze River Delta and Bohai Rim.

DMER - Chinese Port Operators 2.0 - Pearl River Delta, Yangtze River Delta and Bohai Rim, HK Update.

Hong Kong

BOC Aviation provides direct operating leasing of aircrafts to airlines. The Company offers a range services including structured finance, aircraft remarketing, direct operating leases, and technical services.

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BOC Aviation (2588 HK)

Aircraft Leasing Companies: Boring Business?

Is there really a value in the aircraft leasing business? Or is just the hype of market expectation? This report aims to give a more detailed and...

Henry Soediarko

Asian Credit Monitor: China's Onshore Bonds (Part II: Omaha Beach)

In Asian Credit Monitor: China’s Onshore Bonds (Part I: The Normandy), we highlighted the access and motivations for investing in China's onshore...

Bondcritic

66 HK and SBUS SP: Attack on HK Metro Signals Increases in Transport Operators' Costs

Extending my point about more demanding transportation frameworks going forward (see ComfortDelGro FY16 Results: An Era Where Competition Hits a...

Valerie Law, CFA

AIRCRAFT LEASING: Left Holding the Baby

Don’t be tempted to buy into aircraft leasing businesses despite the recent flurry of IPOs. It is a bad industry and the only stocks to trade above...

GMT Research

DMER - Chinese Port Operators 2.0 - Pearl River Delta, Yangtze River Delta and Bohai Rim, HK Update.

In our update yesterday, https://www.smartkarma.com/insights/dmer-chinese-port-operators-avoid-bottom-fishing-in-troubled-waters, we looked at the...

Drewry Maritime Financial Research

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