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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, 17 September 10
CWP COAL WASHING PLANTS MACHINERY LANDS ON RUSSIAN MARKET!!
Press Release: CWP Coal Washing Plants Machinery Industry & Trade Co. which was founded in 1990, has been operating in Izmir with its closed pro ...
Friday, 17 September 10
FREIGHT RATES TO DECLINE FURTHER - ICICI SEC
Broking firm ICICI Securities said tanker freight rates reported a sharp drop with rates of Suezmax and Aframax carriers declining by 16% to USD 8,6 ...
Friday, 17 September 10
R-POWER, ADANI, GMR TO BID FOR $1-BN MINE
Reliance Power, Adani Power and GMR are in the race for a coal mine asset in Australia. The valuation of the asset is close to $1 billion (Rs 4,600 ...
Thursday, 16 September 10
RPG GROUP BUYS 10% IN AUSSIE COAL FIRM RESOURCE GENERATION
Dealcurry reported that, India's RPG Group's Integrated Coal Mining Limited (ICML) has acquired 10% stake (18,268,053 shares) in Resource Generati ...
Wednesday, 15 September 10
VIETNAM TO IMPORT UP TO 15 MLN TONS COAL/YR BY 2015 - VIETNAM BUSINESS
Vietnam Business reported that, Vietnam will need to import 3 million to 15 million tons of coal a year by 2015, rising to 21 million to 40 million ...
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- AsiaOL BioFuels Corp., Philippines
- Xindia Steels Limited - India
- Romanian Commodities Exchange
- Indian Oil Corporation Limited
- SMC Global Power, Philippines
- Independent Power Producers Association of India
- Interocean Group of Companies - India
- Borneo Indobara - Indonesia
- Sakthi Sugars Limited - India
- Kapuas Tunggal Persada - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Bangladesh Power Developement Board
- Renaissance Capital - South Africa
- Bank of Tokyo Mitsubishi UFJ Ltd
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Aboitiz Power Corporation - Philippines
- GVK Power & Infra Limited - India
- Binh Thuan Hamico - Vietnam
- Malabar Cements Ltd - India
- Australian Coal Association
- Miang Besar Coal Terminal - Indonesia
- Singapore Mercantile Exchange
- Petrochimia International Co. Ltd.- Taiwan
- Meralco Power Generation, Philippines
- Petron Corporation, Philippines
- Sarangani Energy Corporation, Philippines
- Oldendorff Carriers - Singapore
- Electricity Generating Authority of Thailand
- Intertek Mineral Services - Indonesia
- Banpu Public Company Limited - Thailand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Savvy Resources Ltd - HongKong
- Merrill Lynch Commodities Europe
- IEA Clean Coal Centre - UK
- McConnell Dowell - Australia
- Jindal Steel & Power Ltd - India
- Bukit Baiduri Energy - Indonesia
- Tamil Nadu electricity Board
- Electricity Authority, New Zealand
- Attock Cement Pakistan Limited
- LBH Netherlands Bv - Netherlands
- Barasentosa Lestari - Indonesia
- Makarim & Taira - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Straits Asia Resources Limited - Singapore
- Iligan Light & Power Inc, Philippines
- Globalindo Alam Lestari - Indonesia
- Sindya Power Generating Company Private Ltd
- MS Steel International - UAE
- PNOC Exploration Corporation - Philippines
- Marubeni Corporation - India
- Georgia Ports Authority, United States
- Global Coal Blending Company Limited - Australia
- Indian Energy Exchange, India
- India Bulls Power Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Baramulti Group, Indonesia
- OPG Power Generation Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- Sinarmas Energy and Mining - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Salva Resources Pvt Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Gujarat Electricity Regulatory Commission - India
- Holcim Trading Pte Ltd - Singapore
- Jorong Barutama Greston.PT - Indonesia
- Timah Investasi Mineral - Indoneisa
- Therma Luzon, Inc, Philippines
- Indogreen Group - Indonesia
- San Jose City I Power Corp, Philippines
- Kideco Jaya Agung - Indonesia
- Maheswari Brothers Coal Limited - India
- Larsen & Toubro Limited - India
- Ceylon Electricity Board - Sri Lanka
- VISA Power Limited - India
- Price Waterhouse Coopers - Russia
- Dalmia Cement Bharat India
- Parliament of New Zealand
- PTC India Limited - India
- Siam City Cement PLC, Thailand
- Grasim Industreis Ltd - India
- Chettinad Cement Corporation Ltd - India
- Indonesian Coal Mining Association
- Africa Commodities Group - South Africa
- Bukit Asam (Persero) Tbk - Indonesia
- ICICI Bank Limited - India
- Semirara Mining and Power Corporation, Philippines
- Thiess Contractors Indonesia
- New Zealand Coal & Carbon
- Aditya Birla Group - India
- Posco Energy - South Korea
- Asmin Koalindo Tuhup - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Mercator Lines Limited - India
- Cement Manufacturers Association - India
- Ambuja Cements Ltd - India
- Antam Resourcindo - Indonesia
- White Energy Company Limited
- Medco Energi Mining Internasional
- Trasteel International SA, Italy
- Commonwealth Bank - Australia
- Energy Development Corp, Philippines
- Wood Mackenzie - Singapore
- Central Java Power - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- The University of Queensland
- Deloitte Consulting - India
- Chamber of Mines of South Africa
- Coalindo Energy - Indonesia
- Kobexindo Tractors - Indoneisa
- Global Green Power PLC Corporation, Philippines
- Altura Mining Limited, Indonesia
- GMR Energy Limited - India
- Rashtriya Ispat Nigam Limited - India
- Sical Logistics Limited - India
- Global Business Power Corporation, Philippines
- TeaM Sual Corporation - Philippines
- Mjunction Services Limited - India
- Directorate Of Revenue Intelligence - India
- Rio Tinto Coal - Australia
- Star Paper Mills Limited - India
- Bukit Makmur.PT - Indonesia
- International Coal Ventures Pvt Ltd - India
- Formosa Plastics Group - Taiwan
- GAC Shipping (India) Pvt Ltd
- London Commodity Brokers - England
- Kepco SPC Power Corporation, Philippines
- Heidelberg Cement - Germany
- Power Finance Corporation Ltd., India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sojitz Corporation - Japan
- The State Trading Corporation of India Ltd
- Uttam Galva Steels Limited - India
- Edison Trading Spa - Italy
- Samtan Co., Ltd - South Korea
- Thai Mozambique Logistica
- Sree Jayajothi Cements Limited - India
- Bayan Resources Tbk. - Indonesia
- Pendopo Energi Batubara - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- PowerSource Philippines DevCo
- Eastern Energy - Thailand
- ASAPP Information Group - India
- Simpson Spence & Young - Indonesia
- Anglo American - United Kingdom
- Vizag Seaport Private Limited - India
- Ministry of Finance - Indonesia
- Australian Commodity Traders Exchange
- Metalloyd Limited - United Kingdom
- Videocon Industries ltd - India
- CNBM International Corporation - China
- Mintek Dendrill Indonesia
- Bulk Trading Sa - Switzerland
- Siam City Cement - Thailand
- South Luzon Thermal Energy Corporation
- Toyota Tsusho Corporation, Japan
- Vedanta Resources Plc - India
- GN Power Mariveles Coal Plant, Philippines
- Goldman Sachs - Singapore
- Ind-Barath Power Infra Limited - India
- Ministry of Mines - Canada
- Economic Council, Georgia
- SMG Consultants - Indonesia
- Ministry of Transport, Egypt
- Neyveli Lignite Corporation Ltd, - India
- Energy Link Ltd, New Zealand
- Riau Bara Harum - Indonesia
- Agrawal Coal Company - India
- Wilmar Investment Holdings
- Billiton Holdings Pty Ltd - Australia
- Krishnapatnam Port Company Ltd. - India
- PetroVietnam Power Coal Import and Supply Company
- The Treasury - Australian Government
- Central Electricity Authority - India
- Kaltim Prima Coal - Indonesia
- Latin American Coal - Colombia
- Indo Tambangraya Megah - Indonesia
- IHS Mccloskey Coal Group - USA
- Gujarat Mineral Development Corp Ltd - India
- Meenaskhi Energy Private Limited - India
- Cigading International Bulk Terminal - Indonesia
- Coastal Gujarat Power Limited - India
- Port Waratah Coal Services - Australia
- Bhushan Steel Limited - India
- Semirara Mining Corp, Philippines
- Gujarat Sidhee Cement - India
- Kartika Selabumi Mining - Indonesia
- Kumho Petrochemical, South Korea
- Directorate General of MIneral and Coal - Indonesia
- Lanco Infratech Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- CIMB Investment Bank - Malaysia
- Orica Mining Services - Indonesia
- SN Aboitiz Power Inc, Philippines
- Parry Sugars Refinery, India
- Standard Chartered Bank - UAE
- Essar Steel Hazira Ltd - India
- Tata Chemicals Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Planning Commission, India
- Manunggal Multi Energi - Indonesia
- Orica Australia Pty. Ltd.
- Indika Energy - Indonesia
- Eastern Coal Council - USA
- Madhucon Powers Ltd - India
- Mercuria Energy - Indonesia
- Bhoruka Overseas - Indonesia
- Bharathi Cement Corporation - India
- Karaikal Port Pvt Ltd - India
- Bhatia International Limited - India
- European Bulk Services B.V. - Netherlands
- Coal and Oil Company - UAE
- Carbofer General Trading SA - India
- Minerals Council of Australia
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