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Asean Confidential - Premium Investment Insight

Update alert

Jokowi is Indonesia’s new President as Subianto withdraws

Joko Widodo has been confirmed as Indonesia’s new President but his rival Prabowo Subianto has till Friday to file a legal challenge against the results. 

23 Jul

MAS likely to face privatisation

The crash of Flight MH17 in Ukraine last week is generating public sympathy for Malaysian Airline System Bhd. We think this reduces political opposition to the possibility that the Malaysian government will privatise the airline. We also note that privatisation would effectively be a government bailout and cost significantly less than bankruptcy.

22 Jul

A giant Malaysian bank in the making

A merger between CIMB, RHB and MBSB will create Malaysia’s largest bank by assets, and Asean’s fourth largest after DBS, OCBC and UOB.

11 Jul

Macro

Politics to the fore

Our research and economic data paint a mixed outlook for the Asean 5, with Thailand and Indonesia highlighting how precarious political cycles continuing to have unpredictable impacts on regional economies.

09 Jul

Big Call

Optimism and caution after Thai coup

Asean Confidential research supports an increase in economic optimism for Thailand following the May 22 coup d'état. We believe Thailand will see a modest recovery in 2H14 and fare much better in 2015 under the most likely scenarios, supported by a healthy auto industry, a rebound in tourism and stimulus provided by the junta. However, the coup-makers must not overreach or they will risk much more negative outcomes. 

11 Jun

Finance

1MDB’s debt poses a risk to Malaysia's fiscal health

1Malaysia Development Bhd (1MDB)'s debt has jumped threefold to MYR36.2bn, and AC believes that this makes it possible that the Malaysian government's contingent liabilities could soar to 19% of GDP from the current level of 15.9% should the entity's investments sour. We examined its latest accounts, the state of its finances, and the implications for the government. The sovereign wealth fund recently filed its 2013 accounts for the period ended March 31 after missing its deadline twice. 

30 Apr

Consumer

Special Report: East Java, Indonesia’s latest pacesetter

East Java now leads by example in Indonesia on a number of key economic metrics – most notably job creation – which is feeding into an ongoing consumption boom across East and Central Java.

11 Jun

Capital Investment

Indonesia construction: rethinking the bull run

Expectations of an infrastructure build-out in Indonesia have fed bullish valuations for related stocks in construction and cement/materials, but weaker fundamentals and looming cement oversupply suggest that investors may be overestimating upside for these firms.

09 Jul

Penang’s development shifts towards mainland

Penang is a rapidly growing manufacturing hub, particularly for electronics, with growing wealth and significant FDI, but land shortages are forcing development off the island to satellite areas, such as Batu Kawan. We are optimistic on the city’s growth trajectory, though infrastructure growth faces risks from fragile relations between the state and central governments.

09 Jul

Malaysia not a threat to Thailand's auto industry

In spite of its much-trumpeted National Automotive Policy, we find that Malaysia will not pose a threat to Thailand’s position as the Detroit of Asean.

11 Jun

Lift-off for Myanmar’s real estate and banking sectors

Our research looks at the rapidly advancing property market in Myanmar, where foreign developers are driving a construction boom, though legal deficiencies continue to provide reasons for caution. Similarly, the opening up of the banking sector is attracting strong foreign interest, though the government will carefully limit the activities of the first foreign licensees.

09 Jul

Cambodia: a balancing act for growth

Cambodia is benefiting from a high-profile return by Japanese investors. Sturdy levels of Chinese, Vietnamese and Korean FDI have also triggered a rebound in construction. Beneficiaries of GDP growth of 7-8% include Thai and Vietnamese companies exporting to Cambodia, including PetroVietnam and investors such as Vinamilk, Axiata, CP Group, and ANZ Bank.

05 Mar

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