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

The Asia HY Trade Book for the month of May includes a summary of our recommendations, as well as our high-conviction ideas. The report also features relative-value charts and lists of the bonds in the Lucror Asia HY index.

   The Asia HY Trade Book for the month of May includes a summary of our recommendations, as well as our high-conviction ideas. The report also features relative-value charts and lists of the bonds in the Lucror Asia HY index. 

Asia HY Trade Book - May 2021 - Lucror Analytics

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-10365'>Sirtex Medical</a></li><li><a href='#lucror-entity-8085'>Times China</a></li><li><a href='#lucror-entity-14152'>Yanlord Land</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.Sirtex MedicalTimes ChinaYanlord Land

Morning Views Asia: Sirtex Medical, Times China, Yanlord Land

In this month’s “In-Focus” section, we provide an update on the Oil & Gas sector, including oil price development and projections, along with the associated drivers.  The Asia Monthly focuses on providing updates on recent events, information on new issues and spread movements, as well as summarising our top picks, and discussing specific areas of interest in the “In-Focus” section. The Asia Monthly is intended to broaden investors' understanding of the Asian USD high-yield market.

  In this month’s “In-Focus” section, we provide an update on the Oil & Gas sector, including oil price development and projections, along with the associated drivers.    The Asia Monthly focuses on providing updates on recent events, information on new issues and spread movements, as well as summarising our top picks, and discussing specific areas of interest in the “In-Focus” section. The Asia Monthly is intended to broaden investors' understanding of the Asian USD high-yield market. 

Asia HY Monthly - Oil & Gas Update (2021) - Lucror Analytics

ASEAN Insight Provider, CrossASEAN Research

Angus Mackintosh

ASEAN Insight Provider

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

Equity Bottom-Up

Bank Negara Indonesia Persero / Equity Bottom-Up

<a href="https://www.smartkarma.com/entities/bank-negara-indonesia-persero" target="_blank" data-smartkarma-citation="entities:8285:1" rel="noopener">Bank Negara Indonesia Persero (BBNI IJ)</a> has historically tended to lag its peers within the top four banks in Indonesia, both in terms of returns and risk management plus their digital initiatives have not yet caught the attention of investors. With a new senior management team in place from <a href="https://www.smartkarma.com/entities/bank-mandiri-persero-tbk-pt" target="_blank" data-smartkarma-citation="entities:441:1" rel="noopener">Bank Mandiri (BMRI IJ)</a> in place, we think this is about to change. 
<a href="https://www.smartkarma.com/entities/bank-negara-indonesia-persero" target="_blank" data-smartkarma-citation="entities:8285:1" rel="noopener">Bank Negara Indonesia Persero (BBNI IJ)</a>is making good progress on its COVID-19 loan restructuring with a reduction in loans under restructuring of IDR18tn in 1Q20201 versus 4Q2020, with further progress in April.
Credit costs fell significantly in 1Q2021, as did provisions versus 4Q2021. Overall NPLs also improved slightly in 1Q2021 falling to 4.1% of total loans. 
One key highlight in 1Q2021 was the decline in <a href="https://www.smartkarma.com/entities/bank-negara-indonesia-persero" target="_blank" data-smartkarma-citation="entities:8285:1" rel="noopener">Bank Negara Indonesia (BBNI IJ)</a>'s cost of funds, which hit the lowest level ever at 1.7% in 1Q2021.
This has helped overall net interest margins (NIMs) hold up in 1Q2021, which are now above the bank's FY2021 guidance range.
The key driver for CASA has been the increased number of mobile banking users which have increased significantly.
Loan growth in 1Q2021 was slow at only +2.2% but this was against a slightly negative picture for the overall banking industry, with small business and consumer loans starting to rebound at <a href="https://www.smartkarma.com/entities/bank-negara-indonesia-persero" target="_blank" data-smartkarma-citation="entities:8285:1" rel="noopener">Bank Negara Indonesia Persero (BBNI IJ)</a>. 
A key focus for <a href="https://www.smartkarma.com/entities/bank-negara-indonesia-persero" target="_blank" data-smartkarma-citation="entities:8285:1" rel="noopener">Bank Negara Indonesia Persero (BBNI IJ)</a> is on the digitalization of both its retail and wholesale banking businesses, which we see as a significant growth driver.
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The bank now trades on 0.9x FY21E PBV, 11.6x FY21E PER, and 7.2x FY22E PER, with forecast EPS growth of +186% and +60% for FY21E and FY22E respectively. We continue to expect positive momentum over the coming quarters for the <a href="https://www.smartkarma.com/entities/bank-negara-indonesia-persero" target="_blank" data-smartkarma-citation="entities:8285:1" rel="noopener">Bank Negara Indonesia Persero (BBNI IJ)</a> both as the economy recovers and its new strategies continue to gain traction.
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Bank Negara Indonesia Persero (BBNI IJ) has historically tended to lag its peers within the top four banks in Indonesia, both in terms of returns and risk management plus their digital initiatives have not yet caught the attention of investors. With a new senior management team in place from Bank Mandiri (BMRI IJ) in place, we think this is about to change. 
Bank Negara Indonesia Persero (BBNI IJ)is making good progress on its COVID-19 loan restructuring with a reduction in loans under restructuring of IDR18tn in 1Q20201 versus 4Q2020, with further progress in April.
Credit costs fell significantly in 1Q2021, as did provisions versus 4Q2021. Overall NPLs also improved slightly in 1Q2021 falling to 4.1% of total loans. 
One key highlight in 1Q2021 was the decline in Bank Negara Indonesia (BBNI IJ)'s cost of funds, which hit the lowest level ever at 1.7% in 1Q2021.
This has helped overall net interest margins (NIMs) hold up in 1Q2021, which are now above the bank's FY2021 guidance range.
The key driver for CASA has been the increased number of mobile banking users which have increased significantly.
Loan growth in 1Q2021 was slow at only +2.2% but this was against a slightly negative picture for the overall banking industry, with small business and consumer loans starting to rebound at Bank Negara Indonesia Persero (BBNI IJ). 
A key focus for Bank Negara Indonesia Persero (BBNI IJ) is on the digitalization of both its retail and wholesale banking businesses, which we see as a significant growth driver.

The bank now trades on 0.9x FY21E PBV, 11.6x FY21E PER, and 7.2x FY22E PER, with forecast EPS growth of +186% and +60% for FY21E and FY22E respectively. We continue to expect positive momentum over the coming quarters for the Bank Negara Indonesia Persero (BBNI IJ) both as the economy recovers and its new strategies continue to gain traction.


Bank Negara Indonesia (BBNI IJ) - The Happening

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-7845'>Road King Infrastructure</a></li><li><a href='#lucror-entity-10365'>Sirtex Medical</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.Road King InfrastructureSirtex Medical

Morning Views Asia: Road King Infrastructure, Sirtex Medical

Indonesia

PT Sri Rejeki Isman Tbk was founded in 1978. The company's line of business includes manufacturing textile products.

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Sri Rejeki Isman (SRIL IJ)

Asia HY Trade Book - May 2021 - Lucror Analytics

The Asia HY Trade Book for the month of May includes a summary of our recommendations, as well as our high-conviction ideas. The report also...

Lucror Analytics

Morning Views Asia: Sirtex Medical, Times China, Yanlord Land

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

Lucror Analytics

Asia HY Monthly - Oil & Gas Update (2021) - Lucror Analytics

In this month’s “In-Focus” section, we provide an update on the Oil & Gas sector, including oil price development and projections, along with...

Lucror Analytics

Bank Negara Indonesia (BBNI IJ) - The Happening

BNI has been the laggard amongst its top four peers in Indonesia but we expect this to change as a new senior management team pushes through new...

Angus Mackintosh

Morning Views Asia: Road King Infrastructure, Sirtex Medical

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

Lucror Analytics

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