Asean round-up

In Vietnam, the government’s planned sale of a 20% in Sabeco, a brewery,  is expected this year, according to bankers.

Wilmar, one of Asia’s largest agribusinesses, and Cargill, the commodities’ trader are setting up in Burma.

18 companies, including Malaysia’s Axiata, Norway’s Telenor Group, parent of the Thai mobile operator DTAC, Digicel, the Caribbean based operator, and two Singaporean companies, Singapore Telecommunications, one of southeast Asia’s biggest telephone companies, and ST Telemedia, a unit of Temasek Holdings, have submitted proposals for the two telecoms licences

The Burma has abolished a 25-year-old ban on public gatherings of more than five people: more liberal than S’pore.

Malayan Banking Bhd (Maybank) has made a US$100 million capital injection into its Philippines operations.The banking group, the fourth largest in the region, on the previous Friday launched a new corporate head office in Manila and announced plans to double its number of branches in that country to 100 by 2014, and thereafter to 200 by 2018, Malaysia’s Business Times said.

It currently has 54 branches there, with another expected to open in the city of Davao by the end of this month.

Maybank Philippines Inc (MPI), which has been operating since 1997 and is now the 24th largest bank by assets, may eventually go for a listing there. The Philippine central bank had last year issued a directive, requiring banks controlled by their foreign counterparts to go for a listing on the Philippine Stock Exchange.

Wilmar: Doing deals with what?

(Or “Why analysts are talking rubbish” or “Bond issue coming up”)

Analysts are telling Wilmar to do deals to get its share price up. Remember they have been fans of Wilmar and need the share price to recover to look gd. 
http://www.sfgate.com/business/bloomberg/article/Wilmar-Deals-Loom-With-Stock-at-65-Discount-to-3817390.php

This Kuok wants to do deals. Its in his blood.

But the analysts forget one thing. How is Wilmar going to finance its deals. Not thru a share issue: because as they are pointing out the shares are “super cheap”. Borrowing more money ain’t that easy because co has net debt of US$12.5bn on a market captalisation of US$19bn. True got gd cash flow and interest cover. But it would need brave bankers. Not many around nowadays as the irrational French frogs are nursing losses.

Err what a bond issue aimed at the retail investor? Why not call DBS? Reason: http://atans1.wordpress.com/2012/08/27/dbs-screws-its-customers-again-and-again/

More bad news for Noble, Olam and Wilmar

The FT reports that Chinese importers are requesting trading houses to defer shipments of commodities. Sometimes they have broken agreements by refusing to accept deliveries.

Commodities specifically mentioned are iron ore and thermal coal (Noble’s specialities), cotton (Olam speciality) and soyabeans (Wilmar is world’s boiggest crusher). No wonder the price of these stocks keep weakening.

BTW, until I read below, I didn’t realise Noble is a big player in coffee and cocoa (but revenue is “peanuts” compared to iron ore and energy).

http://seekingalpha.com/article/572831-commodity-trading-firms-bunge-and-noble-offer-investors-good-value

Wilmar: Beneficiary of China slow-down?

One reason why Wilmar had such a bad set of results was because it’s Jing Long YU (China’s biigest cooking oil brand) could not raise prices because of administrative measures imposed by the government to control inflation. Pre-tax margins in this segment more than halved.

Now that Chinese inflation has fallen to a 20-month low in February, Wilmar should be able to raise prices for this brand?

Broker likes Wilmar

JPMorgan upgrades Wilmar from Neutral to Overweight. It raises target price to S$6.50 from S$5.40.

“We think Wilmar will be able to raise prices in the near term, improving both oilseeds and consumer products margin in 2H11/2012,” citing recent media reports of China removing price controls on cooking oil.

Meanwhile , OCBC retains its Hold call on Wilmar.