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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, 20 September 10
MMTC SEEKS TO BUY 1.3 MT OF COAL FOR INDIA UTILITIES - SXCOAL
MMTC Ltd., India’s largest state- owned trading company, is seeking bids for the supply of 1.3 million tonnes of coal to feed power plants run ...
Monday, 20 September 10
KANGAROO RESOURCES SIGNS PARTNERSHIP WITH ASEAMCO FOR INDONESIAN COAL ASSETS - PROACTIVE INVESTORS
International coal producer Kangaroo Resources (ASX: KRL) has completed a new three-year agreement with Australian mining consultants ASEAMCO to del ...
Monday, 20 September 10
ICVL LOOKS FOR COAL ASSETS IN UZBEK, INDONESIA, AUSTRALIA - ECONOMIC TIMES
Economic Times reported that, International Coal Ventures, or ICVL, the special purpose vehicle floated by five state-owned firms to scout for coal ...
Monday, 20 September 10
IRON-ORE SHIPPING DEMAND MAY GAIN ONCE CHINA STEEL CUTS FINISH, SSY SAYS
Demand to transport iron ore may rebound once China ends steel-production cuts and steel prices may gain in the next several months because of the r ...
Saturday, 18 September 10
ECI / CHINA FREIGHT ROUTE DOWN BY 1.22 PCT OR US$ 225 PER DAY AND CLOSED AT US$ 18,123 PER DAY - VISTAAR
COALspot.com: The BDI was under pressure this week and was almost down by 11 pct and closed at 2676 points.
The Cape and Panamax index was almost ...
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- Krishnapatnam Port Company Ltd. - India
- Bhatia International Limited - India
- AsiaOL BioFuels Corp., Philippines
- International Coal Ventures Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- Sojitz Corporation - Japan
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- MS Steel International - UAE
- Meralco Power Generation, Philippines
- Mercuria Energy - Indonesia
- Globalindo Alam Lestari - Indonesia
- Sakthi Sugars Limited - India
- Parry Sugars Refinery, India
- Mintek Dendrill Indonesia
- Bharathi Cement Corporation - India
- Billiton Holdings Pty Ltd - Australia
- Electricity Authority, New Zealand
- Toyota Tsusho Corporation, Japan
- Rio Tinto Coal - Australia
- IHS Mccloskey Coal Group - USA
- Siam City Cement PLC, Thailand
- Cement Manufacturers Association - India
- South Luzon Thermal Energy Corporation
- Samtan Co., Ltd - South Korea
- TeaM Sual Corporation - Philippines
- Bangladesh Power Developement Board
- Siam City Cement - Thailand
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bukit Baiduri Energy - Indonesia
- The University of Queensland
- Orica Mining Services - Indonesia
- Power Finance Corporation Ltd., India
- Eastern Coal Council - USA
- Holcim Trading Pte Ltd - Singapore
- Kartika Selabumi Mining - Indonesia
- CNBM International Corporation - China
- Posco Energy - South Korea
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Vizag Seaport Private Limited - India
- Jindal Steel & Power Ltd - India
- Chettinad Cement Corporation Ltd - India
- Therma Luzon, Inc, Philippines
- London Commodity Brokers - England
- Ambuja Cements Ltd - India
- Ind-Barath Power Infra Limited - India
- Wilmar Investment Holdings
- Sree Jayajothi Cements Limited - India
- Alfred C Toepfer International GmbH - Germany
- LBH Netherlands Bv - Netherlands
- Deloitte Consulting - India
- Banpu Public Company Limited - Thailand
- Rashtriya Ispat Nigam Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Goldman Sachs - Singapore
- Straits Asia Resources Limited - Singapore
- Australian Commodity Traders Exchange
- Carbofer General Trading SA - India
- CIMB Investment Bank - Malaysia
- Ministry of Mines - Canada
- Neyveli Lignite Corporation Ltd, - India
- Kobexindo Tractors - Indoneisa
- Singapore Mercantile Exchange
- Thiess Contractors Indonesia
- PowerSource Philippines DevCo
- Timah Investasi Mineral - Indoneisa
- European Bulk Services B.V. - Netherlands
- Bukit Asam (Persero) Tbk - Indonesia
- Maheswari Brothers Coal Limited - India
- Directorate Of Revenue Intelligence - India
- Merrill Lynch Commodities Europe
- Chamber of Mines of South Africa
- Gujarat Sidhee Cement - India
- Standard Chartered Bank - UAE
- Bhushan Steel Limited - India
- Pendopo Energi Batubara - Indonesia
- Savvy Resources Ltd - HongKong
- Heidelberg Cement - Germany
- Ministry of Finance - Indonesia
- Edison Trading Spa - Italy
- Kepco SPC Power Corporation, Philippines
- Iligan Light & Power Inc, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Bahari Cakrawala Sebuku - Indonesia
- McConnell Dowell - Australia
- Kaltim Prima Coal - Indonesia
- Mjunction Services Limited - India
- Xindia Steels Limited - India
- Coalindo Energy - Indonesia
- Vedanta Resources Plc - India
- Jorong Barutama Greston.PT - Indonesia
- Baramulti Group, Indonesia
- Videocon Industries ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Indian Oil Corporation Limited
- Tamil Nadu electricity Board
- Metalloyd Limited - United Kingdom
- PetroVietnam Power Coal Import and Supply Company
- Economic Council, Georgia
- PTC India Limited - India
- IEA Clean Coal Centre - UK
- Planning Commission, India
- Energy Link Ltd, New Zealand
- Energy Development Corp, Philippines
- Borneo Indobara - Indonesia
- Bulk Trading Sa - Switzerland
- Australian Coal Association
- Dalmia Cement Bharat India
- Kideco Jaya Agung - Indonesia
- Simpson Spence & Young - Indonesia
- Antam Resourcindo - Indonesia
- Uttam Galva Steels Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Cigading International Bulk Terminal - Indonesia
- Eastern Energy - Thailand
- PNOC Exploration Corporation - Philippines
- SN Aboitiz Power Inc, Philippines
- Trasteel International SA, Italy
- Sical Logistics Limited - India
- Anglo American - United Kingdom
- Asmin Koalindo Tuhup - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Meenaskhi Energy Private Limited - India
- Madhucon Powers Ltd - India
- SMC Global Power, Philippines
- Sinarmas Energy and Mining - Indonesia
- Attock Cement Pakistan Limited
- Lanco Infratech Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Riau Bara Harum - Indonesia
- Independent Power Producers Association of India
- Mercator Lines Limited - India
- Thai Mozambique Logistica
- Coastal Gujarat Power Limited - India
- Kapuas Tunggal Persada - Indonesia
- Grasim Industreis Ltd - India
- Indika Energy - Indonesia
- Binh Thuan Hamico - Vietnam
- Agrawal Coal Company - India
- Renaissance Capital - South Africa
- Intertek Mineral Services - Indonesia
- Star Paper Mills Limited - India
- Salva Resources Pvt Ltd - India
- India Bulls Power Limited - India
- Ceylon Electricity Board - Sri Lanka
- Medco Energi Mining Internasional
- Orica Australia Pty. Ltd.
- Port Waratah Coal Services - Australia
- Global Business Power Corporation, Philippines
- Africa Commodities Group - South Africa
- TNB Fuel Sdn Bhd - Malaysia
- GAC Shipping (India) Pvt Ltd
- Central Electricity Authority - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Gujarat Electricity Regulatory Commission - India
- Semirara Mining Corp, Philippines
- Price Waterhouse Coopers - Russia
- Georgia Ports Authority, United States
- Semirara Mining and Power Corporation, Philippines
- The State Trading Corporation of India Ltd
- Tata Chemicals Ltd - India
- Manunggal Multi Energi - Indonesia
- Indogreen Group - Indonesia
- San Jose City I Power Corp, Philippines
- Central Java Power - Indonesia
- White Energy Company Limited
- The Treasury - Australian Government
- Makarim & Taira - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Bukit Makmur.PT - Indonesia
- Electricity Generating Authority of Thailand
- Karbindo Abesyapradhi - Indoneisa
- Maharashtra Electricity Regulatory Commission - India
- Aboitiz Power Corporation - Philippines
- Marubeni Corporation - India
- Sindya Power Generating Company Private Ltd
- Indian Energy Exchange, India
- Parliament of New Zealand
- Sarangani Energy Corporation, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Latin American Coal - Colombia
- Interocean Group of Companies - India
- Malabar Cements Ltd - India
- Minerals Council of Australia
- Ministry of Transport, Egypt
- GVK Power & Infra Limited - India
- GMR Energy Limited - India
- Wood Mackenzie - Singapore
- Bhoruka Overseas - Indonesia
- Altura Mining Limited, Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- VISA Power Limited - India
- Petron Corporation, Philippines
- Indo Tambangraya Megah - Indonesia
- Bayan Resources Tbk. - Indonesia
- Barasentosa Lestari - Indonesia
- Aditya Birla Group - India
- SMG Consultants - Indonesia
- Global Green Power PLC Corporation, Philippines
- Formosa Plastics Group - Taiwan
- OPG Power Generation Pvt Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Karaikal Port Pvt Ltd - India
- ICICI Bank Limited - India
- Global Coal Blending Company Limited - Australia
- New Zealand Coal & Carbon
- Leighton Contractors Pty Ltd - Australia
- Commonwealth Bank - Australia
- ASAPP Information Group - India
- Indonesian Coal Mining Association
- Kumho Petrochemical, South Korea
- Romanian Commodities Exchange
- Coal and Oil Company - UAE
- Vijayanagar Sugar Pvt Ltd - India
- Oldendorff Carriers - Singapore
- Larsen & Toubro Limited - India
- Essar Steel Hazira Ltd - India
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