UBS Asian Equity Research - Morning Ratings & Earnings (30 Oct 13)

Global and Asia Economics & Strategy

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* Macro Keys - Economics and immigration; Paul Donovan;

* US Economic Comment - Good September nonauto retailsales, but weak

  October consumerconfidence; Maury N. Harris;

* China A-Share Strategy - SOE reform, a long-term topic;Qin Xia;

* China H-share Strategy - SOE reform breakthroughs andimplications; Niall

  MacLeod;

* Asian Economic Comment - India: RBI policy back tonormal, almost; Edward

  Teather;

* India Market Strategy - Q2 earnings half-time: Positivesurprise ; Gautam

  Chhaochharia;

* Japan Economic Comment - Japanese economic outlook for2014-2015;

  Daiju Aoki ;

Alpha Preferences

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* Asia Banks - Alpha Preferences; Stephen Andrews;

* Korea - Alpha Preferences; Young Chang;

Taiwan Telecom Sector

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* Taiwan Telecom Sector - 4G implications for Taiwantelcos; Jinjin Wang;

* Taiwan Mobile (3045.TW) - Buy (from Neutral); PT NT$106(from NT$109);

  +12% upsideUpgrade to Buy post recent weakness;

* Far EasTone (4904.TW) - Buy (from Neutral); PT NT$70(from NT$72); +12%

  upside Upgrade toBuy rating

* Chunghwa Telecom (2412.TW) - Neutral (unch); PT NT$95(unch); +2%

  upside Leastaffected by LTE

Indonesian Nickel

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* Indonesian Nickel - Downgrading ratings post shareprice rally; Anubhav

  Gupta;

* Antam (ANTM.JK) - Sell (from Buy); PT Rp1590 (unch);+3% upside ;

* Vale Indonesia (INCO.JK) - Sell (from Neutral); PTRp2200 (unch); -12%

  downside

Today's PT changes

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* Zhejiang Huahai Pharmaceutical (600521.SS) - Buy(unch); PT Rmb16 (from

  Rmb18); +30%upside Going through transformation pains, but no impact on

  long-termprospects;

* Beijing Oriental Yuhong Waterproof (002271.SZ) - Buy(unch); PT Rmb33

  (from Rmb31);+22% upside Q3 earnings overshoot expectations again; we

  are liftingearnings estimates and PT;

* China Oilfield Services - A (601808.SS) - Buy (unch);PT Rmb25.7 (from

  Rmb20); +15%upside New vessel fundamentals remain solid, high utilisation

  rate boostedgross margin;

* China Oilfield Services (2883.HK) - Neutral (unch); PTHK$23.5 (from

  HK$17.5); +10%upside Raise our EPS on strong drilling segment;

* Zhaojin Mining Industry (1818.HK) - Buy (unch); PTHK$7.22 (from HK$7.62);

  +14% upsideBetter Q4, attractive valuation;

* Haitong Securities - H (6837.HK) - Neutral (unch); PTHK$12.2 (from

  HK$11.6); +7%upside Q3 suggests consensus upgrade to come;

* Swire Pacific (0019.HK) - Sell (unch); PT HK$84.4 (fromHK$86.2); -6%

  downside Q3operating statement;

* Standard Chartered (2888.HK) - Buy (unch); PT HK$210(from HK$215);

  +12% upsideRevenue momentum still subdued ;

* Shriram Transport Finance (SRTR.BO) - Neutral (unch);PT Rs640 (from

  Rs680); +12%upside AUM growth sustains but margins decline continues;

* Omron (6645.T) - Buy (unch); PT ￥4600 (from ￥4300);+27% upside Omron's

  improvedmanagerial capabilities are not yet priced in;

* Hitachi (6501.T) - Buy (unch); PT ￥850 (from ￥900);+27% upside Still stalled;

* SK Telecom (017670.KS) - Buy (unch); PT Won270000 (fromWon253000);

  +14% upside Q313results in line; reaffirm Buy rating;

* Shinhan Financial Group (055550.KS) - Neutral (unch);PT Won48000 (from

  Won41000); +2%upside Q313 earnings missed estimates;

* SK Hynix (000660.KS) - Buy (unch); PT Won44000 (fromWon41000); +38%

  upside Forget thetrees, look at the forest;

* Flexium Interconnect (6269.TW) - Neutral (unch); PTNT$100 (from NT$105);

  +9% upside Noearnings growth in 2014E on diminishing return;

Company Update

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* China Auto Research Institute (601965.SS) - Buy (unch);PT Rmb12 (unch);

  +20% upsideResults growth in line; the quality of the growth exceeded

  expectations;

* China Merchants Holdings (0144.HK) - Buy (unch); PTHK$32 (unch); +15%

  upside 10%increase of listed assets in Q313;

* China National Chemical Engineering (601117.SS) - Buy(unch); PT Rmb10.9

  (unch); +53%upside In-line results, progress on construction likely to

  accelerategradually;

* Dalian Port (PDA) (2880.HK) - Buy (unch); PT HK$2.5(unch); +41% upside

  Q313 growthremain strong;

* Datang International Power (0991.HK) - Buy (unch); PTHK$4.8 (unch); +38%

  upside Q3 resultsbetter than expected;

* Gold Mantis Construction Decoration (002081.SZ) - Buy(unch); PT Rmb33.5

  (unch); +65%upside Results in line, reiterate positive view on long-term

  growth prospects;

* Guangshen Railway (0525.HK) - Buy (unch); PT HK$5.07(unch); +24%

  upside Q313results is disappointing;

* Guangxi Liugong Machinery (000528.SZ) - Buy (unch); PTRmb8.8 (unch);

  +35% upsideProfitability has continued to improve;

* Guangzhou Devotion Thermal Technology (300335.SZ) - Buy(unch); PT

  Rmb21.1 (unch);+14% upside Q3 recurring net profit largely flat YoY and

  QoQ;

* Hand Enterprise Solutions (300170.SZ) - Buy (unch); PTRmb24.6 (unch);

  +56% upsideEarnings grew fast in Q3;

* PetroChina (0857.HK) - Buy (unch); PT HK$11.9 (unch);+34% upside Solid

  earnings recoveryin Q313;

* Poly Real Estate (600048.SS) - Buy (unch); PT Rmb15.6(unch); +71%

  upside New startsgrew strongly, likely to ease the available-for-sale housing

  bottleneck;

* Pubang Landscape Architecture (002663.SZ) - Buy (unch);PT Rmb19.7

  (unch); +36%upside Results in line, ample cash at hand;

* Shandong Nanshan Aluminium (600219.SS) - Buy (unch); PTRmb5.84

  (unch); +14%upside Q3 results in line, focusing on LME storage policy

  reform;

* Shanghai Pharmaceuticals - A (601607.SS) - Buy (unch);PT Rmb18 (unch);

  +30% upsideSteady growth, key businesses doing well;

* Sinopec (0386.HK) - Buy (unch); PT HK$7.6 (unch); +25%upside Q313 is

  2nd best netprofit on record;

* Weichai Power - A (000338.SZ) - Buy (unch); PT Rmb27.5(unch); +47%

  upside Earningsgrowth lower than expected, but valuation below the

  historicalaverage;

* Yantai Jereh Oilfield Services (002353.SZ) - Buy(unch); PT Rmb90 (unch);

  +22% upside Q3results in line, gross margin picked up;

* Zhongjin Gold (600489.SS) - Buy (unch); PT Rmb12.04(unch); +31% upside

  Q3 results camein lower than expected due to declining gold prices;

* China Coal Energy - A (601898.SS) - Neutral (unch); PTRmb5.5 (unch);

  +10% upside 9M13NP down 54% YoY, slightly lower than expected;

* China International Marine Containers (2039.HK) -Neutral (unch); PT

  HK$13.6 (unch);-3% downside Q313 result weaker than expectation;

* China Shipping Container Lines (2866.HK) - Neutral(unch); PT HK$2.14

  (unch); +8%upside Q3 loss is disappointing;

* China Shipping Development (1138.HK) - Neutral (unch);PT HK$4.97 (unch);

  +15% upside Q313loss narrowed, better Q4 outlook;

* Hangzhou Binjiang Real Estate (002244.SZ) - Neutral(unch); PT Rmb9.06

  (unch); +15%upside Booked net profit down 9% YoY, but funding position

  improved further;

* Jiangsu Yuyue Medical Equipment & Supply(002223.SZ) - Neutral (unch);

  PT Rmb23.4(unch); +2% upside Increasing investment into hospitals; profit

  growth slows;

* People.cn (603000.SS) - Neutral (unch); PT Rmb73.1(unch); +8% upside Q3

  profit growthslower;

* Shenzhen GEM High-Tech (002340.SZ) - Neutral (unch); PTRmb11.9 (unch);

  +15% upside Q3results in line; a private placement is planned, entering the

  scrapped carfield;

* Shenzhen Hongtao Decoration (002325.SZ) - Neutral(unch); PT Rmb13

  (unch); +37%upside Results in line, plan to issue shares to address capital

  bottleneck ;

* Sound Environmental Resources (000826.SZ) - Neutral(unch); PT Rmb34.9

  (unch); 0% downsideNo asset impairment accrued, resulting in QoQ net

  profit growth inQ3;

* Air China (0753.HK) - Sell (unch); PT HK$5.37 (unch);-1% downside Q3

  earnings down33%, in line with UBSe;

* China CITIC Bank (0998.HK) - Sell (unch); PT HK$3.8(unch); -8% downside

  Q3 NP beat;sustainability yet to be seen;

* Standard Chartered (STAN.L) - Buy (unch); PT p1790(unch); +18% upside

  Resilientperformance in a weak revenue quarter;

* Esprit (0330.HK) - Buy (unch); PT HK$15.8 (unch); +21%upside FY14 off to

  a solid start;new CPO;

* Lifestyle International (1212.HK) - Buy (unch); PTHK$26 (unch); +55%

  upside In searchof a replacement site;

* Swire Properties (1972.HK) - Neutral (unch); PT HK$22.4(unch); +6% upside

  Flattish officerents and sluggish HK malls' retail sales;

* Semen Indonesia (SMGR.JK) - Buy (unch); PT Rp15800(unch); +10%

  upside Weak 3Q2013 result;

* JSW Steel (JSTL.BO) - Buy (unch); PT Rs1000 (unch);+16% upside Volume

  driven EBITDAbeat;

* National Thermal Power Corporation Ltd. (NTPC.BO) - Buy(unch); PT Rs190

  (unch); +30%upside Q2 FY14 results: In-line;

* Marico Ltd (MRCO.BO) - Neutral (unch); PT Rs240 (unch);+14% upside Q2

  FY14 review;

* Ranbaxy (RANB.BO) - Neutral (unch); PT Rs500 (unch);+30% upside

  Q3FY14 - Belowest. despite adjusting for one-offs;

* Fanuc (6954.T) - Sell (unch); PT ￥11500 (unch); -29%downside Strong

  business model isat a turning point;

* DGB Financial Group (139130.KS) - Buy (unch); PTWon22000 (unch); +32%

  upside Q313results - higher provisioning;

* Hyundai Mobis (012330.KS) - Buy (unch); PT Won340000(unch); +12%

  upside Q3earnings in line with consensus;

* PTT Exploration & Production (PTTE.BK) - Buy(unch); PT Bt190 (unch);

  +12% upside Q3results and conference call feedback;

* Far EasTone (4904.TW) - Buy (unch); PT NT$70 (unch);+12% upside

  YTD13 largelyin-line;

* Apple Inc. (AAPL.O) - Neutral (unch); PT US$540 (unch);+2%

  upside SolidQuarter and Outlook;

Sector note

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* China Cement Sector - Robust peak season, East/SouthCentral price rises

  likely tocontinue in November; Qiang Liu;

* HK China Property Morning Post - CKH disposes 6.03%share in ARA for

  ~HK$550m; EvaLee;

* India Banking & Finance Sector - RBI Q2 policy -Liquidity easing continues;

  Vishal Goyal;

* Hyundai Mobis - To buy back all pref shares; YoungChang;