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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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Tuesday, 21 December 10
CHINA COAL CAP TO BOOST GLOBAL M&A - FINANCIER WORLD WIDE
Financier World Wide reported that, Chinese state-run media has reported that the Central Government intends to cap domestic coal production for fea ...
Tuesday, 21 December 10
CIL TOLD TO SCOUT MINES ABROAD TO BRIDGE COAL DEFICIT - ECONOMIC TIMES
Economic Times reported that, The government asked state-owned CIL to look for acquiring assets abroad to meet the domestic shortfall of coal.
&q ...
Tuesday, 21 December 10
SHIPPING INDUSTRY RECOVERING, BUT STILL HAMPERED BY OVERSUPPLY OF VESSELS AND DEPRESSED FREIGHT RATES - UNCTAD / HELLENIC SHIPPING
International seaborne trade contracted by 4.5 per cent in 2009, reports UNCTAD´s Review of Maritime Transport 2010 . That decline put seaborn ...
Sunday, 19 December 10
SPOT SUPRAMAX VESSELS WERE FIXED AROUND US$ 13,000 PER DAY FOR TRIP VIA INDONESIA TO INDIA - VISTAAR
COALspot.com - The freight market continued to be soft with the BDI down by 96 points and closed at 1,999 points, touching below 2,000 points on Fri ...
Friday, 17 December 10
THE PANAMAX MARKET HAS EXPERIENCED A SOFTER TENDENCY THIS WEEK - FEARNBULK
Handy
Monotonous Atlantic markets with little fresh enquiry in Black Sea/Med/Continent. Large Supras are achieving usd 21/22k for TA rounds - 2/3 ...
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- Formosa Plastics Group - Taiwan
- Indian Oil Corporation Limited
- Kobexindo Tractors - Indoneisa
- Vizag Seaport Private Limited - India
- SN Aboitiz Power Inc, Philippines
- Sojitz Corporation - Japan
- Economic Council, Georgia
- Antam Resourcindo - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Romanian Commodities Exchange
- Offshore Bulk Terminal Pte Ltd, Singapore
- Gujarat Electricity Regulatory Commission - India
- Coal and Oil Company - UAE
- Rio Tinto Coal - Australia
- Grasim Industreis Ltd - India
- VISA Power Limited - India
- Marubeni Corporation - India
- CNBM International Corporation - China
- San Jose City I Power Corp, Philippines
- Trasteel International SA, Italy
- SMC Global Power, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Planning Commission, India
- Bhatia International Limited - India
- Timah Investasi Mineral - Indoneisa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Metalloyd Limited - United Kingdom
- Videocon Industries ltd - India
- Altura Mining Limited, Indonesia
- Attock Cement Pakistan Limited
- Kepco SPC Power Corporation, Philippines
- The State Trading Corporation of India Ltd
- Madhucon Powers Ltd - India
- Price Waterhouse Coopers - Russia
- Thai Mozambique Logistica
- Tamil Nadu electricity Board
- Uttam Galva Steels Limited - India
- IEA Clean Coal Centre - UK
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Straits Asia Resources Limited - Singapore
- Independent Power Producers Association of India
- Global Green Power PLC Corporation, Philippines
- Simpson Spence & Young - Indonesia
- Sree Jayajothi Cements Limited - India
- Bangladesh Power Developement Board
- Mintek Dendrill Indonesia
- Lanco Infratech Ltd - India
- Ambuja Cements Ltd - India
- Sindya Power Generating Company Private Ltd
- Central Java Power - Indonesia
- New Zealand Coal & Carbon
- Anglo American - United Kingdom
- Vijayanagar Sugar Pvt Ltd - India
- Standard Chartered Bank - UAE
- Ind-Barath Power Infra Limited - India
- Indo Tambangraya Megah - Indonesia
- Oldendorff Carriers - Singapore
- Cement Manufacturers Association - India
- Thiess Contractors Indonesia
- Heidelberg Cement - Germany
- Coalindo Energy - Indonesia
- Pendopo Energi Batubara - Indonesia
- GMR Energy Limited - India
- Renaissance Capital - South Africa
- Dalmia Cement Bharat India
- Intertek Mineral Services - Indonesia
- Orica Mining Services - Indonesia
- GAC Shipping (India) Pvt Ltd
- Borneo Indobara - Indonesia
- PTC India Limited - India
- Global Business Power Corporation, Philippines
- London Commodity Brokers - England
- Bahari Cakrawala Sebuku - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Aboitiz Power Corporation - Philippines
- Kalimantan Lumbung Energi - Indonesia
- Essar Steel Hazira Ltd - India
- Indika Energy - Indonesia
- Bulk Trading Sa - Switzerland
- Karbindo Abesyapradhi - Indoneisa
- Bukit Makmur.PT - Indonesia
- Georgia Ports Authority, United States
- Malabar Cements Ltd - India
- Orica Australia Pty. Ltd.
- Kapuas Tunggal Persada - Indonesia
- Mercuria Energy - Indonesia
- Tata Chemicals Ltd - India
- Star Paper Mills Limited - India
- Meenaskhi Energy Private Limited - India
- Sakthi Sugars Limited - India
- Energy Link Ltd, New Zealand
- Electricity Authority, New Zealand
- Bhoruka Overseas - Indonesia
- Mercator Lines Limited - India
- Singapore Mercantile Exchange
- Leighton Contractors Pty Ltd - Australia
- Siam City Cement PLC, Thailand
- Billiton Holdings Pty Ltd - Australia
- Kartika Selabumi Mining - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Coastal Gujarat Power Limited - India
- Power Finance Corporation Ltd., India
- Maheswari Brothers Coal Limited - India
- OPG Power Generation Pvt Ltd - India
- Interocean Group of Companies - India
- Deloitte Consulting - India
- Jindal Steel & Power Ltd - India
- Bayan Resources Tbk. - Indonesia
- Ministry of Transport, Egypt
- Cigading International Bulk Terminal - Indonesia
- Edison Trading Spa - Italy
- Ministry of Finance - Indonesia
- CIMB Investment Bank - Malaysia
- Kaltim Prima Coal - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Therma Luzon, Inc, Philippines
- ICICI Bank Limited - India
- Karaikal Port Pvt Ltd - India
- Indogreen Group - Indonesia
- Vedanta Resources Plc - India
- Iligan Light & Power Inc, Philippines
- Directorate Of Revenue Intelligence - India
- The University of Queensland
- McConnell Dowell - Australia
- Ministry of Mines - Canada
- Indian Energy Exchange, India
- Latin American Coal - Colombia
- Savvy Resources Ltd - HongKong
- Semirara Mining and Power Corporation, Philippines
- Africa Commodities Group - South Africa
- South Luzon Thermal Energy Corporation
- Banpu Public Company Limited - Thailand
- Toyota Tsusho Corporation, Japan
- Agrawal Coal Company - India
- Mjunction Services Limited - India
- Meralco Power Generation, Philippines
- LBH Netherlands Bv - Netherlands
- GVK Power & Infra Limited - India
- Wood Mackenzie - Singapore
- ASAPP Information Group - India
- Chettinad Cement Corporation Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- PNOC Exploration Corporation - Philippines
- Holcim Trading Pte Ltd - Singapore
- Rashtriya Ispat Nigam Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Parliament of New Zealand
- Eastern Energy - Thailand
- Minerals Council of Australia
- TNB Fuel Sdn Bhd - Malaysia
- Sinarmas Energy and Mining - Indonesia
- Gujarat Sidhee Cement - India
- Global Coal Blending Company Limited - Australia
- PetroVietnam Power Coal Import and Supply Company
- GN Power Mariveles Coal Plant, Philippines
- Bharathi Cement Corporation - India
- Samtan Co., Ltd - South Korea
- Petron Corporation, Philippines
- Australian Coal Association
- Kohat Cement Company Ltd. - Pakistan
- Central Electricity Authority - India
- Manunggal Multi Energi - Indonesia
- Bukit Baiduri Energy - Indonesia
- PowerSource Philippines DevCo
- Makarim & Taira - Indonesia
- Sical Logistics Limited - India
- Commonwealth Bank - Australia
- Australian Commodity Traders Exchange
- India Bulls Power Limited - India
- Carbofer General Trading SA - India
- Baramulti Group, Indonesia
- Aditya Birla Group - India
- Merrill Lynch Commodities Europe
- Wilmar Investment Holdings
- Gujarat Mineral Development Corp Ltd - India
- Salva Resources Pvt Ltd - India
- TeaM Sual Corporation - Philippines
- Bhushan Steel Limited - India
- Krishnapatnam Port Company Ltd. - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Riau Bara Harum - Indonesia
- MS Steel International - UAE
- Kumho Petrochemical, South Korea
- Port Waratah Coal Services - Australia
- The Treasury - Australian Government
- Electricity Generating Authority of Thailand
- Posco Energy - South Korea
- Binh Thuan Hamico - Vietnam
- Siam City Cement - Thailand
- Kideco Jaya Agung - Indonesia
- Barasentosa Lestari - Indonesia
- Parry Sugars Refinery, India
- European Bulk Services B.V. - Netherlands
- Energy Development Corp, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Indonesian Coal Mining Association
- Ceylon Electricity Board - Sri Lanka
- Larsen & Toubro Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Sarangani Energy Corporation, Philippines
- Goldman Sachs - Singapore
- Chamber of Mines of South Africa
- White Energy Company Limited
- Alfred C Toepfer International GmbH - Germany
- Semirara Mining Corp, Philippines
- Medco Energi Mining Internasional
- IHS Mccloskey Coal Group - USA
- International Coal Ventures Pvt Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Jaiprakash Power Ventures ltd
- SMG Consultants - Indonesia
- Globalindo Alam Lestari - Indonesia
- Xindia Steels Limited - India
- Eastern Coal Council - USA
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