January 15, 2019

We initiate our coverage on Bangladesh with a STABLE credit outlook for the country. Prime Minister Sheikh Hasina has been re-elected in the general elections in a crucial result for the country’s economy. We expect political stability to improve the credit outlook of this South Asian nation with a renewed emphasis on rapid economic growth now seeming likely. The election was see...

January 9, 2019

In our third report in the Belt and Road Initiative (BRI) or One Belt One Road (OBOR) series, we examine a brand-new US strategic initiative to finance emerging markets economies, including OBOR, African, and Latin American countries.

The on-going trade war between China and the US makes the issue very political. Rightfully so, we believe the creation of the International Developm...

January 7, 2019

If we had to make a base observation for Asia credit markets over 2018, it was certainly caught “wrong-footed” like most of its other risky asset counterparts. The combination of a more hawkish Fed in 2018, global quantitative tightening, late-cycle economic conditions, volatility and a strong USD have all served to impact almost all the asset classes negatively. According to som...

December 24, 2018

Shaktikanta Das has been appointed as the new governor of India’s central bank. The new appointment comes as a major boost to the economy and has driven a rebound in the financial markets as well as the Indian rupee. The country’s current account deficit remains a major concern, although these recent developments further affirm India’s attractiveness as an investment destination.

...

December 11, 2018

Tata Steel Ltd (TATA IN)’s latest quarterly results beat our expectations. The company’s revenue for Q2FY19 (which ended in September) rose 15% YoY, with EBITDA during the same period rising nearly 50% YoY. This growth reflects a good operating and market performance during the quarter. The company has also benefitted from the amalgamation of previously-acquired Bhushan Steel (BH...

December 7, 2018

China’s Belt-and-Road-Initiative (“BRI”) (一带一路) is arguably the 21st century’s most ambitious infrastructure project involving over 65 nations and a third of global GDP. Slightly over 5 years since its inception, the BRI has created both benefits and drawn public criticism from some of its member nations. On the positive side, Chinese companies have been the clear beneficiaries (...

November 28, 2018

We initiate our coverage on Sri Lanka’s sovereign bonds (SRILAN complex) with an OVERWEIGHT recommendation. The SRILAN complex comprises SRILAN 19s, 22s, 26s and 27s. We believe Sri Lankan sovereign bonds (Moody’s: B1; S&P: B+) offer attractive yields in the market versus peers such as Vietnam (Moody’s: Ba3; S&P: BB-). Despite the sell-off due to the political chaos, we believe i...

November 23, 2018

We examine the factors that contribute to consumption trend in China. This quantitative study finds that disposable income plays a significant role in consumption growth, and the overall effect from real estate market is insignificant. However, the wealth effects from real estate market play a significantly positive role in promoting auto sales, one important indicator of consump...

November 19, 2018

Vedanta Resources (VED LN) (Vedanta) was delisted from the London Stock Exchange (LSE) on 01-October-2018. This came on the back of Volcan Investments Ltd, controlled by Executive Chairman Anil Agarwal, successfully buying out the company’s shares in September. The privatization was more noticed by the market since it happened after a series of protests against the death of 13 pe...

November 8, 2018

Hna Group (HNAGRZ CH) announced on 6-November that it has repaid USD300m of principal in SANYPH 11/18s which matured on the same date. The event has unfolded as per our prediction and we believe the SANYPH 11/18 repayment increases the likelihood that SANYPH 12/18s, which will mature on 3-December, will also be redeemed.

As such, we remove SANYPH 11/18s from our coverage and maint...

October 30, 2018

HNA Group Ltd. (HNAGRZ CH) (HNA)’s SANYPH 11/18s will mature on November 6 (next Tuesday) and we believe there is a likelihood that HNA will repay the bonds, based on the group’s credit facilities, on-going asset sales, and additional new debt the group has raised so far since July.

We note that it will be difficult to buy SANYPH 11/18s since the maturity date is already next week...

October 29, 2018

Bondcritic is embarking on a series of a thematic research pieces on China’s Belt and Road Initiative or One-Belt-One-Road (OBOR) to study the impact on Asia. We start with a study on the impact on OBOR on South Asia (India, Pakistan, Bangladesh, and Sri Lanka), which forms a key component of the OBOR project.

The geographical proximity to China, as well as access to trade routes...

October 26, 2018

Bharti Airtel (BHARTI IN) (“Bharti”)’s management announced on 24-October that it would sell a minority stake in Airtel Africa Ltd. (AA), its UK-based mobile operator in 14 African countries for USD1.25bn. The transaction, in effect, put post-money equity valuation of the company’s African business of USD4.4bn with the enterprise value at USD8.15bn.

The share sale will be subscrib...

October 24, 2018

We initiate our coverage on Agile Property Holdings (3383 HK) (“Agile”) with an overall NEUTRAL recommendation on the AGILE complex (increasing leverage concerns are mitigated by a strong business profile at the moment) and a tactical OVERWEIGHT recommendation on AGILE 21s which we view as a cheaper/higher spread pick-up option compared to its peer group.

Agile is a well-entr...

October 18, 2018

Reliance Communications (RCOM IN) has been granted a relief by the Telecom Disputes Settlement & Appellate Tribunal (TDSAT) on 1-October-2018 as the tribunal has rejected Bank Guarantee demands made by the Department of Telecommunications (DoT). RCOM has also managed to sell off multiple large-scale assets in order to repay debt, including a INR30bn sale of fibre and infra assets...

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