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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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- Wood Mackenzie - Singapore
- Global Coal Blending Company Limited - Australia
- International Coal Ventures Pvt Ltd - India
- Madhucon Powers Ltd - India
- Eastern Coal Council - USA
- Krishnapatnam Port Company Ltd. - India
- The University of Queensland
- Bahari Cakrawala Sebuku - Indonesia
- Indogreen Group - Indonesia
- Posco Energy - South Korea
- Bukit Asam (Persero) Tbk - Indonesia
- Attock Cement Pakistan Limited
- Manunggal Multi Energi - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Ministry of Finance - Indonesia
- Rio Tinto Coal - Australia
- GAC Shipping (India) Pvt Ltd
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Maharashtra Electricity Regulatory Commission - India
- Central Java Power - Indonesia
- Parry Sugars Refinery, India
- Altura Mining Limited, Indonesia
- Karaikal Port Pvt Ltd - India
- Bayan Resources Tbk. - Indonesia
- London Commodity Brokers - England
- AsiaOL BioFuels Corp., Philippines
- Billiton Holdings Pty Ltd - Australia
- Romanian Commodities Exchange
- Electricity Authority, New Zealand
- Coastal Gujarat Power Limited - India
- Renaissance Capital - South Africa
- Sinarmas Energy and Mining - Indonesia
- Kartika Selabumi Mining - Indonesia
- The State Trading Corporation of India Ltd
- Lanco Infratech Ltd - India
- Sindya Power Generating Company Private Ltd
- Anglo American - United Kingdom
- Offshore Bulk Terminal Pte Ltd, Singapore
- Samtan Co., Ltd - South Korea
- European Bulk Services B.V. - Netherlands
- Sarangani Energy Corporation, Philippines
- Barasentosa Lestari - Indonesia
- Trasteel International SA, Italy
- Binh Thuan Hamico - Vietnam
- VISA Power Limited - India
- Aboitiz Power Corporation - Philippines
- OPG Power Generation Pvt Ltd - India
- Orica Australia Pty. Ltd.
- Iligan Light & Power Inc, Philippines
- Cement Manufacturers Association - India
- Energy Development Corp, Philippines
- PNOC Exploration Corporation - Philippines
- New Zealand Coal & Carbon
- Banpu Public Company Limited - Thailand
- PTC India Limited - India
- Kaltim Prima Coal - Indonesia
- Mercator Lines Limited - India
- Indonesian Coal Mining Association
- The Treasury - Australian Government
- Economic Council, Georgia
- Power Finance Corporation Ltd., India
- Interocean Group of Companies - India
- Planning Commission, India
- Energy Link Ltd, New Zealand
- Goldman Sachs - Singapore
- Ind-Barath Power Infra Limited - India
- Chamber of Mines of South Africa
- Eastern Energy - Thailand
- ASAPP Information Group - India
- Semirara Mining and Power Corporation, Philippines
- Deloitte Consulting - India
- Videocon Industries ltd - India
- Kepco SPC Power Corporation, Philippines
- Marubeni Corporation - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Baramulti Group, Indonesia
- Maheswari Brothers Coal Limited - India
- TeaM Sual Corporation - Philippines
- IEA Clean Coal Centre - UK
- Meralco Power Generation, Philippines
- Bhatia International Limited - India
- Savvy Resources Ltd - HongKong
- LBH Netherlands Bv - Netherlands
- PowerSource Philippines DevCo
- Gujarat Mineral Development Corp Ltd - India
- Star Paper Mills Limited - India
- Global Green Power PLC Corporation, Philippines
- Global Business Power Corporation, Philippines
- Indika Energy - Indonesia
- Bharathi Cement Corporation - India
- GVK Power & Infra Limited - India
- SMC Global Power, Philippines
- Grasim Industreis Ltd - India
- Electricity Generating Authority of Thailand
- India Bulls Power Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Commonwealth Bank - Australia
- Timah Investasi Mineral - Indoneisa
- Pendopo Energi Batubara - Indonesia
- Standard Chartered Bank - UAE
- Edison Trading Spa - Italy
- Heidelberg Cement - Germany
- Alfred C Toepfer International GmbH - Germany
- Mintek Dendrill Indonesia
- Antam Resourcindo - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Mjunction Services Limited - India
- South Luzon Thermal Energy Corporation
- Kumho Petrochemical, South Korea
- Siam City Cement PLC, Thailand
- Coalindo Energy - Indonesia
- Bukit Makmur.PT - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Ambuja Cements Ltd - India
- Aditya Birla Group - India
- Uttam Galva Steels Limited - India
- Bhoruka Overseas - Indonesia
- Bukit Baiduri Energy - Indonesia
- Chettinad Cement Corporation Ltd - India
- Price Waterhouse Coopers - Russia
- Directorate Of Revenue Intelligence - India
- Thiess Contractors Indonesia
- Kapuas Tunggal Persada - Indonesia
- Siam City Cement - Thailand
- CNBM International Corporation - China
- Kalimantan Lumbung Energi - Indonesia
- Oldendorff Carriers - Singapore
- Malabar Cements Ltd - India
- ICICI Bank Limited - India
- Indian Energy Exchange, India
- Ministry of Transport, Egypt
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- TNB Fuel Sdn Bhd - Malaysia
- Australian Commodity Traders Exchange
- Thai Mozambique Logistica
- Wilmar Investment Holdings
- McConnell Dowell - Australia
- Bhushan Steel Limited - India
- Sakthi Sugars Limited - India
- Straits Asia Resources Limited - Singapore
- Gujarat Sidhee Cement - India
- IHS Mccloskey Coal Group - USA
- Karbindo Abesyapradhi - Indoneisa
- Africa Commodities Group - South Africa
- Miang Besar Coal Terminal - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Therma Luzon, Inc, Philippines
- Bulk Trading Sa - Switzerland
- Parliament of New Zealand
- Simpson Spence & Young - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Intertek Mineral Services - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Central Electricity Authority - India
- Mercuria Energy - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Agrawal Coal Company - India
- Semirara Mining Corp, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Makarim & Taira - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Cigading International Bulk Terminal - Indonesia
- Carbofer General Trading SA - India
- Independent Power Producers Association of India
- Indo Tambangraya Megah - Indonesia
- Latin American Coal - Colombia
- Merrill Lynch Commodities Europe
- Dalmia Cement Bharat India
- Australian Coal Association
- Toyota Tsusho Corporation, Japan
- Orica Mining Services - Indonesia
- Coal and Oil Company - UAE
- Rashtriya Ispat Nigam Limited - India
- Vedanta Resources Plc - India
- Singapore Mercantile Exchange
- SMG Consultants - Indonesia
- Formosa Plastics Group - Taiwan
- Sree Jayajothi Cements Limited - India
- Ministry of Mines - Canada
- Bangladesh Power Developement Board
- Indian Oil Corporation Limited
- Tamil Nadu electricity Board
- Georgia Ports Authority, United States
- Xindia Steels Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Globalindo Alam Lestari - Indonesia
- Port Waratah Coal Services - Australia
- Meenaskhi Energy Private Limited - India
- Metalloyd Limited - United Kingdom
- Asmin Koalindo Tuhup - Indonesia
- Medco Energi Mining Internasional
- Petrochimia International Co. Ltd.- Taiwan
- PetroVietnam Power Coal Import and Supply Company
- Jindal Steel & Power Ltd - India
- Sical Logistics Limited - India
- Riau Bara Harum - Indonesia
- GMR Energy Limited - India
- Minerals Council of Australia
- Essar Steel Hazira Ltd - India
- Salva Resources Pvt Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Jaiprakash Power Ventures ltd
- Vizag Seaport Private Limited - India
- SN Aboitiz Power Inc, Philippines
- Larsen & Toubro Limited - India
- Petron Corporation, Philippines
- Kideco Jaya Agung - Indonesia
- MS Steel International - UAE
- CIMB Investment Bank - Malaysia
- San Jose City I Power Corp, Philippines
- Sojitz Corporation - Japan
- White Energy Company Limited
- Tata Chemicals Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Borneo Indobara - Indonesia
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