Senior Credit Analyst, Lucror Analytics

Leonard Law, CFA

Senior Credit Analyst

High Yield Experts

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.

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.<ul><li><a href='#lucror-entity-20844'>Medco Energi</a></li><li><a href='#lucror-entity-384'>Yankuang Energy Group</a></li></ul>

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 EnergiYankuang Energy Group

Morning Views Asia: Medco Energi, Yankuang Energy Group

External broker reports(aggregated public sources), BRI Danareksa Research

BRI Danareksa Research

External broker reports(aggregated public sources)

As a one-stop financial solution with the vision to be the most valuable securities house, BRI Danareksa Sekuritas (BRIDS) has maintained an excellent track record and extensive experience in the capital market as an underwriter, broker, and financial advisor for individual, institutional, foreign and domestic, private and government clients. Established in 1992, PT Danareksa Sekuritas is a securities company that performs activities as a securities broker, underwriter, or arranger and financial advisor.

Equity Bottom-Up

<ul><li>We reiterate our Buy rating on MEDC with a TP of IDR1,900 as we see upside in earnings and reserve in 2024F onwards from the potentially accretive prospective Middle East asset acquisition and the potential release of Tanzania 2P Reserves.</li><li>Expect the potential Middle East acquisition to be completed at end of 2023. Medco entered into an agreement to acquire a 20% non-operating stake in a Middle East O&amp;G asset in Aug23, with management expecting the deal to be closed by end of FY23.</li><li>According to Fitch report, the potential new block may add production rate of 13 mboped and 2P reserves of 56 mmboe (net MEDC’s ownership). </li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

We reiterate our Buy rating on MEDC with a TP of IDR1,900 as we see upside in earnings and reserve in 2024F onwards from the potentially accretive prospective Middle East asset acquisition and the potential release of Tanzania 2P Reserves.Expect the potential Middle East acquisition to be completed at end of 2023. Medco entered into an agreement to acquire a 20% non-operating stake in a Middle East O&amp;G asset in Aug23, with management expecting the deal to be closed by end of FY23.According to Fitch report, the potential new block may add production rate of 13 mboped and 2P reserves of 56 mmboe (net MEDC’s ownership). Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Medco Energi International (MEDC IJ) - A Potentially More Compelling Growth Story in FY24

Lucror Analytics Weekly Wraps provide an overview of all Morning Views comments and reports published by our analyst team in the past week, and also showcase a list of the most-read reports.In this Insight:<ol><li><a href='/entities/adani-green-energy-ltd' target='_blank' rel='noopener'>Adani Green Energy</a></li><li><a href='/entities/vedanta-resources-ltd' target='_blank' rel='noopener'>Vedanta Resources</a></li><li><a href='/entities/china-jinmao-holdings-group' target='_blank' rel='noopener'>China Jinmao Holdings</a></li><li><a href='/entities/geely-automobile-holdings-ltd' target='_blank' rel='noopener'>Geely Auto</a></li><li><a href='/entities/first-pacific-co-ltd' target='_blank' rel='noopener'>First Pacific Co</a></li></ol>and more...

Lucror Analytics Weekly Wraps provide an overview of all Morning Views comments and reports published by our analyst team in the past week, and also showcase a list of the most-read reports.In this Insight:Adani Green EnergyVedanta ResourcesChina Jinmao HoldingsGeely AutoFirst Pacific Coand more...

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.<ul><li><a href='#lucror-entity-20844'>Medco Energi</a></li></ul>

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

Medco Energi's tender offers are positive for existing bondholders in our view, as the early tender considerations are 2-3 pts above the last traded prices before the announcement. Conversely, we doubt the repurchases will provide significant interest savings for the company. Still, we view the proposed new notes issuance as credit positive for Medco, as it will lengthen the debt maturity profile and enable the company to finance a Middle East acquisition using long-term funding. We recommend that holders of the MEDCIJ 6.75 25 tender before the early tender deadline, but are neutral on the tender offer for the remaining notes. We see fair value for the proposed 2029 notes at 9.2-9.7%.

  Medco Energi's tender offers are positive for existing bondholders in our view, as the early tender considerations are 2-3 pts above the last traded prices before the announcement. Conversely, we doubt the repurchases will provide significant interest savings for the company. Still, we view the proposed new notes issuance as credit positive for Medco, as it will lengthen the debt maturity profile and enable the company to finance a Middle East acquisition using long-term funding.   We recommend that holders of the MEDCIJ 6.75 25 tender before the early tender deadline, but are neutral on the tender offer for the remaining notes. We see fair value for the proposed 2029 notes at 9.2-9.7%.  

Medco Energi - Event Flash - Tender Offer And Potential Notes Issuance - Lucror Analytics

Indonesia

PT Medco Energi Internasional Tbk is an integrated energy company. The Company explores for and produces oil and gas both in Indonesia and internationally, operates gas-fired power plants in Panaran I, Batam Island, and develops renewable fuels such as Bio-fuel.

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Medco Energi (MEDC IJ)

Morning Views Asia: Medco Energi, Yankuang Energy Group

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region,...

Lucror Analytics

Medco Energi International (MEDC IJ) - A Potentially More Compelling Growth Story in FY24

We reiterate our Buy rating on MEDC with a TP of IDR1,900 as we see upside in earnings and reserve in 2024F onwards from the potentially accretive...

BRI Danareksa Research

Weekly Wrap - 27 Oct 2023

Lucror Analytics Weekly Wraps provide an overview of all Morning Views comments and reports published by our analyst team in the past week, and...

Lucror Analytics

Morning Views Asia: Medco Energi

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region,...

Lucror Analytics

Medco Energi - Event Flash - Tender Offer And Potential Notes Issuance - Lucror Analytics

Medco Energi's tender offers are positive for existing bondholders in our view, as the early tender considerations are 2-3 pts above the last...

Lucror Analytics

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