Head of Asia, Lucror Analytics

Charles Macgregor

Head of Asia

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-22202'>Vedanta Resources</a></li><li><a href='#lucror-entity-18097'>Yuexiu Property </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.Vedanta ResourcesYuexiu Property 

Morning Views Asia: Vedanta Resources, Yuexiu Property  

Yuexiu Property's (YXP) H1/23 results were largely in line with expectations. Overall revenue climbed 2.6% y-o-y to CNY 32.1 bn, driven by strong growth in property management, rental income and real estate agency & decoration services. However, sales from property development remained stagnant at CNY 29.8 bn (H1/22: CNY 29.8 bn). The company encountered ongoing margin pressure, largely due to falling profits and margins for the property development business, which we believe is in line with the overall industry trend. We note positively YXP's CNY 221 bn in unrecognised sales, which could have positive implications for steady revenue growth in the near to medium term. The company appears to have resilient access to capital markets. Liquidity was boosted as at end-June 2023, by a c. 39% y-o-y increase in cash to CNY 30.3 bn. The debt structure improved, with exposure to ST debt narrowing to 12% of total debt. The 2023 notes are trading near par (yielding 7-8%). The YUEXIU 2.8 26 are quoted at c. 90.6 (yielding 6.9-7.2%), while the 2031 notes are trading at c. 80 (yielding c. 7.5%). We view the pricing as fair, and maintain our "Hold" recommendation on the YUEXIU curve given the current weak market technicals.

  Yuexiu Property's (YXP) H1/23 results were largely in line with expectations. Overall revenue climbed 2.6% y-o-y to CNY 32.1 bn, driven by strong growth in property management, rental income and real estate agency & decoration services. However, sales from property development remained stagnant at CNY 29.8 bn (H1/22: CNY 29.8 bn). The company encountered ongoing margin pressure, largely due to falling profits and margins for the property development business, which we believe is in line with the overall industry trend.   We note positively YXP's CNY 221 bn in unrecognised sales, which could have positive implications for steady revenue growth in the near to medium term. The company appears to have resilient access to capital markets. Liquidity was boosted as at end-June 2023, by a c. 39% y-o-y increase in cash to CNY 30.3 bn. The debt structure improved, with exposure to ST debt narrowing to 12% of total debt.   The 2023 notes are trading near par (yielding 7-8%). The YUEXIU 2.8 26 are quoted at c. 90.6 (yielding 6.9-7.2%), while the 2031 notes are trading at c. 80 (yielding c. 7.5%). We view the pricing as fair, and maintain our "Hold" recommendation on the YUEXIU curve given the current weak market technicals. 

Yuexiu Property - Earnings Flash - H1 FY 2023 Results - Lucror Analytics

We view Yuexiu Property (YXP) as "Low Risk" on the LARA scale. Our assessment takes into account the company's: [1] parental support from Guangzhou Yuexiu (GYX), which is an SOE; [2] sound operating track record; [3] good contracted sales performance; and [4] geographical diversity, with a focus on the Greater Bay Area. These are balanced against weak market sentiment and a change in government policy. Our fundamental Credit Bias on YXP is "Stable". We expect its near-term credit profile to be supported by stable sales and cash collection, with Transit-oriented Development being a key factor underpinning the company's growth. While YXP likely has limited room for margin improvement given the industry trends, we believe YXP could still outperform most of its competitors in terms of profitability. In addition, we expect the developer to have good funding access, given parent GYX's SOE status and close relationship with the municipal government. Controversies are "Immaterial" and the ESG Impact on Credit is "Neutral". We maintain our "Buy" recommendation on the YUEXIU curve. We like the company's fundamentals and its support from GYX. We also expect YXP's near-term credit profile to be supported by stable sales and cash collection.

  We view Yuexiu Property (YXP) as "Low Risk" on the LARA scale. Our assessment takes into account the company's: [1] parental support from Guangzhou Yuexiu (GYX), which is an SOE; [2] sound operating track record; [3] good contracted sales performance; and [4] geographical diversity, with a focus on the Greater Bay Area. These are balanced against weak market sentiment and a change in government policy.   Our fundamental Credit Bias on YXP is "Stable". We expect its near-term credit profile to be supported by stable sales and cash collection, with Transit-oriented Development being a key factor underpinning the company's growth. While YXP likely has limited room for margin improvement given the industry trends, we believe YXP could still outperform most of its competitors in terms of profitability. In addition, we expect the developer to have good funding access, given parent GYX's SOE status and close relationship with the municipal government.   Controversies are "Immaterial" and the ESG Impact on Credit is "Neutral".   We maintain our "Buy" recommendation on the YUEXIU curve. We like the company's fundamentals and its support from GYX. We also expect YXP's near-term credit profile to be supported by stable sales and cash collection. 

Yuexiu Property - Tear Sheet - Lucror Analytics

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Equity Capital Markets

Yuexiu Property   / Equity Capital Markets

<ul>
<li>A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.</li>
<li>ECM developments - <a href="https://www.smartkarma.com/entities/tata-technologies" target="_blank" data-smartkarma-citation="entities:23700:1" rel="noopener">Tata Technologies (TATATECH IN)</a>, <a href="https://www.smartkarma.com/entities/horizon-construction-development" target="_blank" data-smartkarma-citation="entities:35117:1" rel="noopener">Horizon Construction Development (1887128D HK)</a>, <a href="https://www.smartkarma.com/entities/growatt-new-energy-technology" target="_blank" data-smartkarma-citation="entities:36103:1" rel="noopener">Growatt Technology (1833969D CH)</a> IPOs; <a href="https://www.smartkarma.com/entities/yuexiu-property-co-ltd" target="_blank" data-smartkarma-citation="entities:18097:1" rel="noopener">Yuexiu Property (123 HK)</a> rights trading.</li>
<li>Event-Driven developments - <a href="https://www.smartkarma.com/entities/invocare-ltd" target="_blank" data-smartkarma-citation="entities:9044:1" rel="noopener">Invocare Ltd (IVC AU)</a>, <a href="https://www.smartkarma.com/entities/newcrest-mining-ltd" target="_blank" data-smartkarma-citation="entities:691:1" rel="noopener">Newcrest Mining (NCM AU)</a>, <a href="https://www.smartkarma.com/entities/united-malt-group-ltd" target="_blank" data-smartkarma-citation="entities:29116:1" rel="noopener">United Malt Group Ltd (UMG AU)</a>, <a href="https://www.smartkarma.com/entities/united-fiber-system-ltd" target="_blank" data-smartkarma-citation="entities:20826:1" rel="noopener">Golden Energy &amp; Resources (GER SP)</a>, <a href="https://www.smartkarma.com/entities/penguin-international-ltd" target="_blank" data-smartkarma-citation="entities:10190:1" rel="noopener">Penguin International (PBS SP)</a>.  </li>
</ul>


A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
ECM developments - Tata Technologies (TATATECH IN), Horizon Construction Development (1887128D HK), Growatt Technology (1833969D CH) IPOs; Yuexiu Property (123 HK) rights trading.
Event-Driven developments - Invocare Ltd (IVC AU), Newcrest Mining (NCM AU), United Malt Group Ltd (UMG AU), Golden Energy &amp; Resources (GER SP), Penguin International (PBS SP).  


Weekly Deals Digest (21 May) - Yuexiu, Horizon Construction, Newcrest, InvoCare, Golden Energy

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>The <a href="https://www.smartkarma.com/entities/yuexiu-property-co-ltd" target="_blank" data-smartkarma-citation="entities:18097:1" rel="noopener">Yuexiu Property (123 HK)</a> Rights start trading today. Last day is next Monday. There is a general pattern to the flows and it behooves investors to be aware.</li>
<li>There is a pattern to these trades which is worth understanding.</li>
<li>In this case, I expect it is worth going long Yuexiu Rights vs Short peer basket equity earlier in the cycle.</li>
</ul>


The Yuexiu Property (123 HK) Rights start trading today. Last day is next Monday. There is a general pattern to the flows and it behooves investors to be aware.
There is a pattern to these trades which is worth understanding.
In this case, I expect it is worth going long Yuexiu Rights vs Short peer basket equity earlier in the cycle.


China

Yuexiu Property Company Ltd., through its subsidiaries, develops, manages and invests in properties. The Company also invests in a Real Estate Investment Trusts.

52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Yuexiu Property (123 HK)

Morning Views Asia: Vedanta Resources, Yuexiu Property

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

Lucror Analytics

Yuexiu Property - Earnings Flash - H1 FY 2023 Results - Lucror Analytics

Yuexiu Property's (YXP) H1/23 results were largely in line with expectations. Overall revenue climbed 2.6% y-o-y to CNY 32.1 bn, driven by strong...

Lucror Analytics

Yuexiu Property - Tear Sheet - Lucror Analytics

We view Yuexiu Property (YXP) as "Low Risk" on the LARA scale. Our assessment takes into account the company's: [1] parental support from...

Lucror Analytics

Weekly Deals Digest (21 May) - Yuexiu, Horizon Construction, Newcrest, InvoCare, Golden Energy

Last week, notable developments occurred in Event-Driven (InvoCare, Newcrest, United Malt, Golden Energy, Penguin) and ECM (Yuexiu, Tata Tech,...

Arun George

Yuexiu Rights - The Trading Pattern Fits

Yuexiu Property (123 HK) Rights are trading today. The stock is trading down, as expected, as those who do not wish to re-up sell their rights. I...

Travis Lundy

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)