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Thursday, 25 November 10
ANALYSIS: COAL SECTOR: VALUE EMERGENCE - THE JAKARTA POST
 Coal demand will remain firm due to a build-up of coal-fired power plants in India, China and Indonesia. As a result, we have upgraded our coal price from US$95 per ton to a range of between $100, 105, 108, 110 and 115 per ton, respectively in 2011, 2012, 2013, 2014 and 2015 (inflation rate of 1 percent thereafter).
Additionally, Indonesia is one of the lowest cost coal producers in the world, which means that coal prices have to adjust with the incremental cost of production of higher-cost structured companies.
Thermal Seaborne coal demand is set to rise by 74 percent to 1,187 million tons in 2025 from 680 million tons in 2010, according to Coaltrans Coal Conference in Amsterdam last month. This is driven by a higher demand from China and India, which currently accounts for about 28 percent of the global thermal coal market.
China, which currently relies on coal to produce 80 percent of its power needs, is installing two new coal-fired power plants per week with capacities of 500 megawatts per plant. This pace will persist at least in the next decade, potentially doubling power capacity by 2020 and adding a 500-gigawatts new coal-fired electricity generation capacity according to the International Energy Agency. We highlight that with China consuming 43 percent of the global thermal coal production, imbalances between its indigenous production and consumption will drive global coal prices higher.
As for India, at present it imports about 8 percent of global coal production. But the number is set to grow to 25 percent by 2015. Indian thermal coal demand is expected to rise 810 million tons, or 131 percent, by 2025, driven by a 158 percent hike in coal-fired power capacity, in line with power demand, which will rise from the current 147 gigawatts to 380 gigawatts by 2025.
Meanwhile, Vietnam, which three years ago was the largest exporter of coal to China, is expected to become a net importer by 2015, putting further pressure on global supply in the medium term. Vietnam currently exports about 50 percent of its production or about 24 million tons, but this will fall to only 3 million tons, despite rising coal production from 48 million tons in 2009 to about 105 million tons in 2025.
Stripping out PT Bayan Resources’ (BYAN’s) price movements, the coal sector has underperformed the market by 9.8 percent year-to-date (ytd). We believe value is emerging, particularly for our top picks, and we raise our sector weighting to overweight.
At this stage, PT Bukit Asam (PTBA) has the highest upside potential based on Discounted Cash Flow (DCF), helped by the inclusion of the Banjarsari power project in our forecasts. We like PTBA’s railway expansion projects, which will increase PTBA’s railway capacity from 11 million tons currently to 47.7 million tons by 2015 or 82.7 million tons by 2018.
This will increase fourfold PTBA’s production from 12.7 million tons to 52.5 million tons by 2015 or by seven fold to 87.5 million tons by 2018. We also like PTBA for its government link, translating to more secured supply contracts to PLN. Additionally, we like its huge reserves (fives times Indonesia’s coal production), which will pave the way for it to become the second-largest coal producer after BUMI starting in 2018.
This means 33 percent compound annual growth rate (CAGR) for earning per share (EPS) in the next five years through 2015. It also has cash reserves of Rp 4.9 trillion with no debt and solid corporate governance. Our second pick is PT Indika Energy or INDY (+27 percent upside), due to Kideco’s strong performance (which contributes 76 percent of its pre-tax profit). This is followed by Adaro Energy (+19 percent), the largest market cap and second-highest average daily turnover after BUMI, which plans to nearly double production from about 42 million tons in 2010 to 80 million tons by 2014.
Surabhi Chopra, The writer is an analyst at PT Bahana Securities Source: The Jakarta Post
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Friday, 12 November 10
BANPU'S NET PROFIT HAS INCREASED 249 PERCENT IN 3Q 2010 COMPARED TO THE SAME PERIOD LAST YEAR
COALspot.com: Banpu Public Company Limited (BANPU) reports its financial performance for the third quarter 2010, posting a net profit of THB 13,293 ...
Friday, 12 November 10
DRY BULK MARKET STILL ON A FREEFALL - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market failed to show any signs of life this week, with the Baltic Dry Index (BDI) still being on the red, now stretching more than 11 ...
Thursday, 11 November 10
KOMIPO WANTS 400KT OF SUB BITUMINOUS COAL
COALspot.com : Korea Midland Power Co. Ltd. (KOMIPO) is looking for 400,000 MT of sub bituminous coal through International open bidding. The delive ...
Wednesday, 10 November 10
NTPC TO IMPORT 12 MILLION TONS OF COAL IN 2011
COALspot.com: India's State Trading Corp Ltd a public sector Govt of India co. is looking for 12 million tones (+/- 2%) of imported coal for NTPC. ...
Tuesday, 09 November 10
NOBLE GROUP APPOINTED AS THE EXCLUSIVE MARKETING AGENT FOR PT. BERAU COAL
COALspot.com: Noble Group Limited has recently been appointed as the exclusive marketing agent for PT. Berau Coal production exported to internation ...
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- Eastern Energy - Thailand
- SN Aboitiz Power Inc, Philippines
- Deloitte Consulting - India
- Electricity Authority, New Zealand
- Cement Manufacturers Association - India
- Energy Link Ltd, New Zealand
- Baramulti Group, Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Georgia Ports Authority, United States
- Bharathi Cement Corporation - India
- Meralco Power Generation, Philippines
- Bukit Makmur.PT - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Directorate Of Revenue Intelligence - India
- Independent Power Producers Association of India
- Sical Logistics Limited - India
- Indo Tambangraya Megah - Indonesia
- Bhoruka Overseas - Indonesia
- Globalindo Alam Lestari - Indonesia
- New Zealand Coal & Carbon
- Orica Australia Pty. Ltd.
- Attock Cement Pakistan Limited
- Aboitiz Power Corporation - Philippines
- Indika Energy - Indonesia
- GVK Power & Infra Limited - India
- Australian Coal Association
- Sojitz Corporation - Japan
- Kohat Cement Company Ltd. - Pakistan
- Tata Chemicals Ltd - India
- Mercuria Energy - Indonesia
- Energy Development Corp, Philippines
- Eastern Coal Council - USA
- Pendopo Energi Batubara - Indonesia
- Grasim Industreis Ltd - India
- International Coal Ventures Pvt Ltd - India
- Marubeni Corporation - India
- India Bulls Power Limited - India
- Iligan Light & Power Inc, Philippines
- Lanco Infratech Ltd - India
- Essar Steel Hazira Ltd - India
- Bulk Trading Sa - Switzerland
- Makarim & Taira - Indonesia
- Merrill Lynch Commodities Europe
- Banpu Public Company Limited - Thailand
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Samtan Co., Ltd - South Korea
- Neyveli Lignite Corporation Ltd, - India
- Toyota Tsusho Corporation, Japan
- Dalmia Cement Bharat India
- Rashtriya Ispat Nigam Limited - India
- TeaM Sual Corporation - Philippines
- Barasentosa Lestari - Indonesia
- Maheswari Brothers Coal Limited - India
- Kapuas Tunggal Persada - Indonesia
- Electricity Generating Authority of Thailand
- Aditya Birla Group - India
- Agrawal Coal Company - India
- Antam Resourcindo - Indonesia
- Interocean Group of Companies - India
- Maharashtra Electricity Regulatory Commission - India
- Leighton Contractors Pty Ltd - Australia
- Uttam Galva Steels Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Thai Mozambique Logistica
- Romanian Commodities Exchange
- CIMB Investment Bank - Malaysia
- Commonwealth Bank - Australia
- Sakthi Sugars Limited - India
- IHS Mccloskey Coal Group - USA
- Meenaskhi Energy Private Limited - India
- Timah Investasi Mineral - Indoneisa
- SMG Consultants - Indonesia
- Vizag Seaport Private Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Xindia Steels Limited - India
- Wilmar Investment Holdings
- Minerals Council of Australia
- PTC India Limited - India
- Jindal Steel & Power Ltd - India
- Malabar Cements Ltd - India
- Planning Commission, India
- Port Waratah Coal Services - Australia
- Star Paper Mills Limited - India
- Wood Mackenzie - Singapore
- SMC Global Power, Philippines
- Sindya Power Generating Company Private Ltd
- Posco Energy - South Korea
- Mjunction Services Limited - India
- Larsen & Toubro Limited - India
- Ministry of Mines - Canada
- Metalloyd Limited - United Kingdom
- Goldman Sachs - Singapore
- Ministry of Finance - Indonesia
- Salva Resources Pvt Ltd - India
- European Bulk Services B.V. - Netherlands
- Jorong Barutama Greston.PT - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Indian Oil Corporation Limited
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- PowerSource Philippines DevCo
- ASAPP Information Group - India
- Cigading International Bulk Terminal - Indonesia
- Kepco SPC Power Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Sinarmas Energy and Mining - Indonesia
- South Luzon Thermal Energy Corporation
- Edison Trading Spa - Italy
- OPG Power Generation Pvt Ltd - India
- Central Java Power - Indonesia
- Simpson Spence & Young - Indonesia
- Madhucon Powers Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Medco Energi Mining Internasional
- Borneo Indobara - Indonesia
- Karaikal Port Pvt Ltd - India
- Global Business Power Corporation, Philippines
- Gujarat Electricity Regulatory Commission - India
- Mercator Lines Limited - India
- Kaltim Prima Coal - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Bayan Resources Tbk. - Indonesia
- Kartika Selabumi Mining - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- GAC Shipping (India) Pvt Ltd
- Jaiprakash Power Ventures ltd
- The University of Queensland
- Altura Mining Limited, Indonesia
- Ind-Barath Power Infra Limited - India
- Renaissance Capital - South Africa
- Parry Sugars Refinery, India
- Straits Asia Resources Limited - Singapore
- Petrochimia International Co. Ltd.- Taiwan
- Indian Energy Exchange, India
- Siam City Cement - Thailand
- Gujarat Mineral Development Corp Ltd - India
- Formosa Plastics Group - Taiwan
- Mintek Dendrill Indonesia
- Videocon Industries ltd - India
- VISA Power Limited - India
- Carbofer General Trading SA - India
- Therma Luzon, Inc, Philippines
- MS Steel International - UAE
- Thiess Contractors Indonesia
- The State Trading Corporation of India Ltd
- Central Electricity Authority - India
- Trasteel International SA, Italy
- Intertek Mineral Services - Indonesia
- Price Waterhouse Coopers - Russia
- TNB Fuel Sdn Bhd - Malaysia
- Bangladesh Power Developement Board
- Heidelberg Cement - Germany
- Parliament of New Zealand
- Billiton Holdings Pty Ltd - Australia
- Binh Thuan Hamico - Vietnam
- Sarangani Energy Corporation, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Gujarat Sidhee Cement - India
- Chettinad Cement Corporation Ltd - India
- Indogreen Group - Indonesia
- Indonesian Coal Mining Association
- PNOC Exploration Corporation - Philippines
- Petron Corporation, Philippines
- Holcim Trading Pte Ltd - Singapore
- Vijayanagar Sugar Pvt Ltd - India
- Global Green Power PLC Corporation, Philippines
- Rio Tinto Coal - Australia
- Standard Chartered Bank - UAE
- Power Finance Corporation Ltd., India
- Kobexindo Tractors - Indoneisa
- The Treasury - Australian Government
- Kumho Petrochemical, South Korea
- Latin American Coal - Colombia
- Ceylon Electricity Board - Sri Lanka
- IEA Clean Coal Centre - UK
- Africa Commodities Group - South Africa
- Sree Jayajothi Cements Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Bukit Baiduri Energy - Indonesia
- Singapore Mercantile Exchange
- McConnell Dowell - Australia
- Economic Council, Georgia
- Oldendorff Carriers - Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- London Commodity Brokers - England
- Alfred C Toepfer International GmbH - Germany
- Tamil Nadu electricity Board
- Savvy Resources Ltd - HongKong
- Bhatia International Limited - India
- Australian Commodity Traders Exchange
- GMR Energy Limited - India
- Ambuja Cements Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- ICICI Bank Limited - India
- Vedanta Resources Plc - India
- Semirara Mining Corp, Philippines
- Manunggal Multi Energi - Indonesia
- San Jose City I Power Corp, Philippines
- Orica Mining Services - Indonesia
- Global Coal Blending Company Limited - Australia
- Riau Bara Harum - Indonesia
- Ministry of Transport, Egypt
- Coastal Gujarat Power Limited - India
- Chamber of Mines of South Africa
- Bukit Asam (Persero) Tbk - Indonesia
- Bhushan Steel Limited - India
- Krishnapatnam Port Company Ltd. - India
- Bahari Cakrawala Sebuku - Indonesia
- Siam City Cement PLC, Thailand
- CNBM International Corporation - China
- Anglo American - United Kingdom
- Coal and Oil Company - UAE
- Kideco Jaya Agung - Indonesia
- White Energy Company Limited
- Coalindo Energy - Indonesia
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