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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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Monday, 07 February 11
RICHARDS BAY COAL TERMINAL EXPORTS SURGE, BUOYED BY ECONOMIC DEVELOPMENT IN CHINA AND INDIA
COALspot.com - Richards Bay Coal Terminal (RBCT) announced today that 2010 exports have exceeded the last two years’ performance, said in a re ...
Monday, 07 February 11
RBCT SHIPPED 28.67 PERCENT LESS COAL IN JANUARY
COALspot.com - Richards Bay Coal Terminal (RBCT) is the single largest export coal terminal in the world, shipped 4,389,925 MT of coal in January 20 ...
Sunday, 06 February 11
THE PANAMAX & SUPRAMAX FUTURES FOR 2011-2013 WAS AT AROUND US$ 16,500 & US$ 15,000 PER DAY RESPECTIVELY
COALspot.com - With the Chinese new year holidays this week, the market has been fairly quite as expected.
The BDI saw a bigger drop compared to ...
Saturday, 05 February 11
INDONESIAN ENERGY MINISTER HAS SIGNED A DECREE FOR COAL TRANSPORTATION PERMITS ON FRIDAY
COALspot.com - Minister of Energy, Darwin Minister Saleh said, that, he had signed a decree for transportation and sale of coal, which was the ...
Saturday, 05 February 11
ANCHORAGE LOADING POINT MOVED TO MUARA JAWA
COALspot.com - The Ministry of Transportation Republic Indonesia has announced that, the loading point at Muara Berau, East kalimantan h ...
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- Star Paper Mills Limited - India
- Port Waratah Coal Services - Australia
- Price Waterhouse Coopers - Russia
- ICICI Bank Limited - India
- The Treasury - Australian Government
- Asmin Koalindo Tuhup - Indonesia
- Eastern Coal Council - USA
- Kepco SPC Power Corporation, Philippines
- Meralco Power Generation, Philippines
- Deloitte Consulting - India
- Sical Logistics Limited - India
- India Bulls Power Limited - India
- Energy Link Ltd, New Zealand
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- TeaM Sual Corporation - Philippines
- Simpson Spence & Young - Indonesia
- Intertek Mineral Services - Indonesia
- Medco Energi Mining Internasional
- PTC India Limited - India
- Marubeni Corporation - India
- PetroVietnam Power Coal Import and Supply Company
- South Luzon Thermal Energy Corporation
- Meenaskhi Energy Private Limited - India
- SMC Global Power, Philippines
- Heidelberg Cement - Germany
- Australian Commodity Traders Exchange
- Agrawal Coal Company - India
- Formosa Plastics Group - Taiwan
- Gujarat Sidhee Cement - India
- Miang Besar Coal Terminal - Indonesia
- Banpu Public Company Limited - Thailand
- Rashtriya Ispat Nigam Limited - India
- Kideco Jaya Agung - Indonesia
- Chettinad Cement Corporation Ltd - India
- Posco Energy - South Korea
- Wilmar Investment Holdings
- Indian Energy Exchange, India
- Australian Coal Association
- Jindal Steel & Power Ltd - India
- Minerals Council of Australia
- Dalmia Cement Bharat India
- Rio Tinto Coal - Australia
- Latin American Coal - Colombia
- Iligan Light & Power Inc, Philippines
- Siam City Cement PLC, Thailand
- Trasteel International SA, Italy
- European Bulk Services B.V. - Netherlands
- Sojitz Corporation - Japan
- Orica Mining Services - Indonesia
- Anglo American - United Kingdom
- Ministry of Finance - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Vijayanagar Sugar Pvt Ltd - India
- New Zealand Coal & Carbon
- Gujarat Electricity Regulatory Commission - India
- Bukit Asam (Persero) Tbk - Indonesia
- Global Coal Blending Company Limited - Australia
- Sindya Power Generating Company Private Ltd
- Essar Steel Hazira Ltd - India
- Bhoruka Overseas - Indonesia
- Bharathi Cement Corporation - India
- Singapore Mercantile Exchange
- SMG Consultants - Indonesia
- Indogreen Group - Indonesia
- Mintek Dendrill Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- The University of Queensland
- Karaikal Port Pvt Ltd - India
- Economic Council, Georgia
- CIMB Investment Bank - Malaysia
- Alfred C Toepfer International GmbH - Germany
- Georgia Ports Authority, United States
- Commonwealth Bank - Australia
- Edison Trading Spa - Italy
- Kumho Petrochemical, South Korea
- Standard Chartered Bank - UAE
- Parry Sugars Refinery, India
- Ambuja Cements Ltd - India
- Indonesian Coal Mining Association
- Ministry of Transport, Egypt
- Energy Development Corp, Philippines
- Larsen & Toubro Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kaltim Prima Coal - Indonesia
- Electricity Generating Authority of Thailand
- Carbofer General Trading SA - India
- Kohat Cement Company Ltd. - Pakistan
- Kalimantan Lumbung Energi - Indonesia
- LBH Netherlands Bv - Netherlands
- Goldman Sachs - Singapore
- VISA Power Limited - India
- Riau Bara Harum - Indonesia
- Power Finance Corporation Ltd., India
- Pipit Mutiara Jaya. PT, Indonesia
- Global Green Power PLC Corporation, Philippines
- Mercator Lines Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Africa Commodities Group - South Africa
- GAC Shipping (India) Pvt Ltd
- London Commodity Brokers - England
- Attock Cement Pakistan Limited
- Parliament of New Zealand
- Interocean Group of Companies - India
- GMR Energy Limited - India
- Bukit Baiduri Energy - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Vedanta Resources Plc - India
- Lanco Infratech Ltd - India
- Sree Jayajothi Cements Limited - India
- Electricity Authority, New Zealand
- Borneo Indobara - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Savvy Resources Ltd - HongKong
- Mjunction Services Limited - India
- Madhucon Powers Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Cement Manufacturers Association - India
- San Jose City I Power Corp, Philippines
- Salva Resources Pvt Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Uttam Galva Steels Limited - India
- Coalindo Energy - Indonesia
- Bulk Trading Sa - Switzerland
- Malabar Cements Ltd - India
- SN Aboitiz Power Inc, Philippines
- MS Steel International - UAE
- Central Java Power - Indonesia
- Makarim & Taira - Indonesia
- CNBM International Corporation - China
- The State Trading Corporation of India Ltd
- Central Electricity Authority - India
- Jorong Barutama Greston.PT - Indonesia
- Coastal Gujarat Power Limited - India
- Oldendorff Carriers - Singapore
- Samtan Co., Ltd - South Korea
- AsiaOL BioFuels Corp., Philippines
- Altura Mining Limited, Indonesia
- Tamil Nadu electricity Board
- Bukit Makmur.PT - Indonesia
- Aboitiz Power Corporation - Philippines
- Thai Mozambique Logistica
- PowerSource Philippines DevCo
- Chamber of Mines of South Africa
- Global Business Power Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- PNOC Exploration Corporation - Philippines
- Independent Power Producers Association of India
- Aditya Birla Group - India
- Kapuas Tunggal Persada - Indonesia
- Ind-Barath Power Infra Limited - India
- Kartika Selabumi Mining - Indonesia
- Thiess Contractors Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Jaiprakash Power Ventures ltd
- Neyveli Lignite Corporation Ltd, - India
- Sinarmas Energy and Mining - Indonesia
- Sarangani Energy Corporation, Philippines
- Siam City Cement - Thailand
- White Energy Company Limited
- Pendopo Energi Batubara - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Ministry of Mines - Canada
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Orica Australia Pty. Ltd.
- Metalloyd Limited - United Kingdom
- Timah Investasi Mineral - Indoneisa
- International Coal Ventures Pvt Ltd - India
- Bangladesh Power Developement Board
- Maheswari Brothers Coal Limited - India
- GVK Power & Infra Limited - India
- Vizag Seaport Private Limited - India
- Videocon Industries ltd - India
- Indika Energy - Indonesia
- Coal and Oil Company - UAE
- IEA Clean Coal Centre - UK
- Grasim Industreis Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- McConnell Dowell - Australia
- Binh Thuan Hamico - Vietnam
- Indian Oil Corporation Limited
- IHS Mccloskey Coal Group - USA
- Petron Corporation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Bayan Resources Tbk. - Indonesia
- Toyota Tsusho Corporation, Japan
- Bhatia International Limited - India
- Mercuria Energy - Indonesia
- Globalindo Alam Lestari - Indonesia
- Barasentosa Lestari - Indonesia
- Xindia Steels Limited - India
- Semirara Mining and Power Corporation, Philippines
- Krishnapatnam Port Company Ltd. - India
- Wood Mackenzie - Singapore
- Manunggal Multi Energi - Indonesia
- Baramulti Group, Indonesia
- Eastern Energy - Thailand
- Kobexindo Tractors - Indoneisa
- Billiton Holdings Pty Ltd - Australia
- Planning Commission, India
- Holcim Trading Pte Ltd - Singapore
- Indo Tambangraya Megah - Indonesia
- OPG Power Generation Pvt Ltd - India
- Antam Resourcindo - Indonesia
- Sakthi Sugars Limited - India
- Leighton Contractors Pty Ltd - Australia
- Merrill Lynch Commodities Europe
- Petrochimia International Co. Ltd.- Taiwan
- Bhushan Steel Limited - India
- Romanian Commodities Exchange
- Renaissance Capital - South Africa
- ASAPP Information Group - India
- Directorate Of Revenue Intelligence - India
- Semirara Mining Corp, Philippines
- Cigading International Bulk Terminal - Indonesia
- Straits Asia Resources Limited - Singapore
- Therma Luzon, Inc, Philippines
- Tata Chemicals Ltd - India
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