China Macroeconomics & Academia

Christopher Balding

Macroeconomics

Outlook on China’s PMI  The month of June furthered the case that the Chinese economy has plateaued and potentially started declining again. With last month’s PMI at 50.1, there was reason to believe we would see real economy expansion but this failed to materialize. Throughout June, most industries showed a downward trend in production output generating a PMI of 50.0, .1 lower than the last month. The slowdown in output and manager expectation does not provide a positive outlook on a leverage…

Outlook on China’s PMI  The month of June furthered the case that the Chinese economy has plateaued and potentially started declining again. With last month’s PMI at 50.1, there was reason to believe we would see real economy expansion but this failed to materialize. Throughout June, most industries showed a downward trend in production output generating a PMI of 50.0, .1 lower than the last month. The slowdown in output and manager expectation does not provide a positive outlook on a leverage…

Recent data of the excessively leveraged economy in China yielded few positive results. While data from previous months hinted that the Chinese economy might be heading towards growth, the post PMI of 50.1 defied those predictions.Most sectors in June either witnessed stagnant output or a decline except for steel which has witnessed output growth of 14% since January 31. Though in the beginning of June the daily steel output slightly declined, it is anticipated that with the start of the…

Recent data of the excessively leveraged economy in China yielded few positive results. While data from previous months hinted that the Chinese economy might be heading towards growth, the post PMI of 50.1 defied those predictions.Most sectors in June either witnessed stagnant output or a decline except for steel which has witnessed output growth of 14% since January 31. Though in the beginning of June the daily steel output slightly declined, it is anticipated that with the start of the…

Co-founder & Managing Director, Marketnomix 

Rajan Govil

Co-founder & Managing Director

Marketnomix 

China’s data releases in recent days have continued to broadly reflect the ongoing slowdown in the economy. While industrial production remained steady in May 2016, retail sales as well as fixed asset investment continued to slow.  Money supply and outstanding loans also slowed in May.Industrial production in China remained steady in May 2016 rising 6.0% y-o-y, the same as in April, and compared to an increase of 6.8% y-o-y for March 2016. On a year-to-date (ytd) y-o-y basis, industrial…

China’s data releases in recent days have continued to broadly reflect the ongoing slowdown in the economy. While industrial production remained steady in May 2016, retail sales as well as fixed asset investment continued to slow.  Money supply and outstanding loans also slowed in May.Industrial production in China remained steady in May 2016 rising 6.0% y-o-y, the same as in April, and compared to an increase of 6.8% y-o-y for March 2016. On a year-to-date (ytd) y-o-y basis, industrial…

China: May Industrial Production Held Steady, Fixed Asset Investment, Loans Growth Slowed

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.

Thematic (Sector/Industry)

Since the GFC, the global port operators have been under-performing the MSCI world index. The divergence has increased in the last 18 months and is now reaching an extreme. Does this make the sector a buy? We believe the industry dynamics are changing and the sector is pricing in  a structural slowdown in global trade. The growth industry has matured and is now more akin to valuations given to a utilities business i.e. P/E compression is in play despite still strong margins and earnings. We believe that ports sector on a macro basis is moving from a growth stock to a value stock which commands stable but lower P/E.  Wider implications for this would be the investor profile for the ports will change as more value investors get in and growth investors move away. We expect Chinese operators to get aggressive on M&amp;A and cheapest valuation in the sector in years on account of structural weakness to drive M&amp;A.

Since the GFC, the global port operators have been under-performing the MSCI world index. The divergence has increased in the last 18 months and is now reaching an extreme. Does this make the sector a buy? We believe the industry dynamics are changing and the sector is pricing in  a structural slowdown in global trade. The growth industry has matured and is now more akin to valuations given to a utilities business i.e. P/E compression is in play despite still strong margins and earnings. We believe that ports sector on a macro basis is moving from a growth stock to a value stock which commands stable but lower P/E.  Wider implications for this would be the investor profile for the ports will change as more value investors get in and growth investors move away. We expect Chinese operators to get aggressive on M&amp;A and cheapest valuation in the sector in years on account of structural weakness to drive M&amp;A. 

Port Operators - Valuations Downshift on Structural Changes

Counter cyclical investment strategy to run its course, Downgrade to Neutral on multiple headwinds<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/009/137/original/t3.JPG?1465611344" class="editor-image img-responsive" data-smartkarma-image-id="9137"></figure> • Demand for tankers to grow, albeit at a slower pace: The sharp decline in crude prices in 2014-15 on account of supply glut in the crude oil market has turned the fortune of tanker operators. Demand for oil tankers picked up as crude demand surged on account of increased crude consumption and greater stockpiling activity for building Strategic Petroleum Reserves (SPRs) by China and India, as their…

Counter cyclical investment strategy to run its course, Downgrade to Neutral on multiple headwinds • Demand for tankers to grow, albeit at a slower pace: The sharp decline in crude prices in 2014-15 on account of supply glut in the crude oil market has turned the fortune of tanker operators. Demand for oil tankers picked up as crude demand surged on account of increased crude consumption and greater stockpiling activity for building Strategic Petroleum Reserves (SPRs) by China and India, as their…

Tanker Shipping Cycle - Counter Cyclical Investment Strategy to Run Its Course, Downgrade to Neutral

China

Jiangsu Expressway Company Ltd. constructs, operates, manages and maintains expressways in China.  The Company also provides passenger transportation and other ancillary services along including fueling stations, restaurants, car maintenance and repair and advertising.

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Jiangsu Expressway (H) (177 HK)

China Economic Recap for June

Outlook on China’s PMI The month of June furthered the case that the Chinese economy has plateaued and potentially started declining again. With...

Christopher Balding

Early Look June Economic Activity

Recent data of the excessively leveraged economy in China yielded few positive results. While data from previous months hinted that the Chinese...

Christopher Balding

China: May Industrial Production Held Steady, Fixed Asset Investment, Loans Growth Slowed

China’s data releases in recent days have continued to broadly reflect the ongoing slowdown in the economy. While industrial production remained...

Rajan Govil

Port Operators - Valuations Downshift on Structural Changes

Since the GFC, the global port operators have been under-performing the MSCI world index. The divergence has increased in the last 18 months and is...

Drewry Maritime Financial Research

Tanker Shipping Cycle - Counter Cyclical Investment Strategy to Run Its Course, Downgrade to Neutral

Counter cyclical investment strategy to run its course, Downgrade to Neutral on multiple headwinds • Demand for tankers to grow, albeit at a slower...

Drewry Maritime Financial Research

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