EM ASIA FX-Ringgit hits 13-year high; Koreans brake won again 19 Aug 2010 15:27

     * Ringgit strongest since 1997, charts point to more gains 
    * Yuan/ringgit stable in trading debut 
    * Won strength sparks dlr-buying intervention 
    * Baht hits fresh 28-month high 
     
    By Kevin Yao 
    SINGAPORE, Aug 19 (Reuters) - The Malaysian ringgit hit a 
13-year high on Thursday after the central bank allowed it to be 
used for offshore trade settlements, while South Korean 
authorities again intervened to cap the buoyant won. 
    The dollar edged up against the yen <JPY=>, with investors 
reluctant to chase the yen higher as they waited to see if the 
Bank of Japan or the government will take new steps to rein in 
the yen's rise, which is threatening the country's fragile 
economic recovery. [ID:nTOE67I04Y] 
     
    RINGGIT 
    The ringgit <MYR=> gained half of a percent to 3.1273 per 
dollar, its highest since October 1997, after the central bank 
announced late on Wednesday it would allow the use of ringgit for 
offshore settlements of trade in goods and services, fueling 
speculation it may internationalise the currency. 
    (To read a story with questions and answers on the move, see 
[ID:nSGE67I06T]) 
    China also began directly trading the yuan against the 
ringgit on Thursday in its latest step to make the yuan a more 
global currency, further supporting the ringgit. [ID:nLDE67H175] 
    "China's yuan/ringgit quotes in the interbank system added to 
the dollar/ringgit downward move," said a trader in Kuala Lumpur. 
    But traders saw no sign of central bank intervention to slow 
ringgit gains, which were largely in line with its regional 
peers.  
    The ringgit is the top performing Asian currency so far this 
year, gaining 9.3 percent against the dollar. It has risen 1.8 
percent this month alone. 
    Chart signals, including slow stochastics and MACD, show that 
the ringgit is on track to test 3.10 per dollar, a level last hit 
in mid-October 1997, after piercing through a key barrier at 
3.1280, a high hit in April 2008. 
 
    YUAN 
    The yuan <CNY=CFXS> hovered near 6.7895 per dollar amid signs 
that the People's Bank of China hopes to keep the currency 
stable, while the yuan's trading debut against the ringgit put it 
largely in line with the Malaysian currency's offshore rate. 
    The yuan was trading within a range of less than 50 pips 
around 0.461 against the ringgit in morning trade, dealers said, 
compared with the PBOC's mid-point of 0.46204, from where the 
yuan can rise or fall 5 percent against the ringgit each day.  
   "It appears the market has good interest in the new trading 
pair," said a dealer at a major European Bank in Shanghai. 
    The ringgit is the sixth foreign currency to trade in the 
domestic market, the China Foreign Exchange Trading System 
(CFETS), after the U.S. dollar, Hong Kong dollar, yen, euro and 
sterling. The yuan can rise or fall 5 percent from the central 
bank's fixing each day. 
 
    WON 
    The South Korean won <KRW=> gained 0.4 percent to 1,169.4 per 
dollar, its highest since Aug 10, as foreign investors' local 
bond purchases and bids from exporters prompted players to clear 
dollar-long positions to stop losses. 
    It later pulled back to 1,174 as foreign exchange authorities 
were again spotted buying dollars to contain the won's advance. 
    "It looks difficult to chase it further as we saw the 
authorities around 1,170," said a local bank dealer. 
    But another local bank dealer said the won may extend gains 
if foreigners kept buying domestic bonds. 
    By Wednesday, foreign investors had bought a combined net 
2.87 trillion won so far this month, data from the Financial 
Supervisory Service shows. South Korean shares <.KS11> rose 1 
percent as foreign investors bought local stocks. 
     
    BAHT 
    The Thai baht <THB=> hit 31.38 per dollar, a fresh 28-month 
high, prompting intervention by Bank of Thailand. 
    "Capital inflows are picking up speed, going into Thai stocks 
and bonds. The whole world is selling dollars and the general 
feeling here is BOT will probably let it settle at around this 
level," a Bangkok-based dealer said. 
    Thai stocks <.SETI> climbed 1.3 percent. 
    The baht has rallied just over 1 percent in the past week and 
5.6 percent this year, the third-best Asian performer after the 
ringgit and yen. 
 Change on the day at   0702 GMT 
 Currency    Latest bid   Previous day    Pct Move 
 Japan yen        85.84          85.36       -0.56 
 Sing dlr        1.3523         1.3523       +0.00 
 Taiwan dlr      31.903         31.966       +0.20 
 Korean won     1172.15        1174.20       +0.17 
 Baht             31.58          31.60       +0.06 
 Peso             44.88          45.10       +0.50 
 Rupiah         8965.00        8970.00       +0.06 
 Rupee            46.57          46.56       -0.02 
 Ringgit         3.1298         3.1430       +0.42 
 Yuan            6.7887         6.7917       +0.04 
  
 Change so far in 2010 
 Currency    Latest bid  End prev year    Pct Move 
 Japan yen        85.84          92.90       +8.22 
 Sing dlr        1.3523         1.4053       +3.92 
 Taiwan dlr      31.903         32.030       +0.40 
 Korean won     1172.15        1164.50       -0.65 
 Baht             31.58          33.32       +5.51 
 Peso             44.88          46.20       +2.95 
 Rupiah         8965.00        9420.00       +5.08 
 Rupee            46.57          46.54       -0.06 
 Ringgit         3.1298         3.4220       +9.34 
 Yuan            6.7887         6.8270       +0.56 
 (Additional reporting by Cheon Jong-woo in SEOUL, Lu Jianxin in 
SHANGHAI and Vithoon Amorn in BANGKOK) 
 (Editing by Kim Coghill) 
 ((kevin.yao@thomsonreuters.com; +65 6870 3841; Reuters 
Messaging: kevin.yao.reuters.com@reuters.net )) 
 ((If you have a query or comment on this story, send an email to 
news.feedback.asia@thomsonreuters.com)) 
  For the new Reuters scrolling global forex service please click 
<FXNEWS> 
  ((Multimedia versions of Reuters Top News are now available for: 
 * 3000 Xtra    : visit http://topnews.session.rservices.com 
 * BridgeStation: view story .134 
For more information on Top News, please visit 
http://topnews.reuters.com)) 
 
    Double click on brackets for following items: 
    Asian currencies   <AFX=>   Asian currencies in Asia <AFX=A> 
    Malaysian ringgit  <MYRX=>  Indonesian rupiah  <IDRX=> 
    Singapore dollar   <SGDX=>  Thai baht          <THBX=> 
    Taiwan dollar      <TWDX=>  Hong Kong dollar   <H

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Chaoda says to raise $356 mln to expand production 18 Aug 2010 09:18

HONG KONG, Aug 18 (Reuters) - Chaoda Modern Agriculture (Holdings) <0682.HK> plans to raise a total of $356 million via issues of bonds, options and shares to expand existing and establish new production areas in China.

In a filing to the Hong Kong bourse late on Tuesday, the Chinese agricultural products producer said it would issue up to $200 million in 3.7 percent secured guaranteed convertible bonds due 2015 and about $6 million worth of call options.

It also aims to raise $150 million through the sale of 154.84 million shares at HK$7.53 ($0.969) each, or a 12.03 percent discount to the previous close, to substantial shareholder Kailey Investment Ltd.

Trading in its shares, which was suspended on Monday, will resume on Wednesday.

Kailey's stake in Chaoda Modern will be diluted to 19.20 percent after the share sale from 20.13 percent.

IFR reported on Monday that Chaoda Modern planned to raise at least $400 million via share, bond and warrant issues. [ID:nTOE67F06H] (Reporting by Donny Kwok; Editing by Jonathan Hopfner) ((donny.kwok@thomsonreuters.com; +852 2843 6470; Reuters Messaging: donny.kwok.reuters.com@reuters.net)) ((If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com)) ($1=7.771 Hong Kong Dollar) Keywords: CHAODA BONDS

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UFufeng Group (HKG:0546) Convertible Bond Conversion Price 20% Above Current LevelFU

Hong Kong, May 13, 2010 (ABN Newswire) - Fufeng Group (HKG:0546) (PINK:FFNGY) has announced it will issue Rmb-dominated convertible bonds (CBs) to raise Rmb 820mil-1bil. As the initial conversion price (HK$7.03) is below both of the current share price and our current PT of HK$6.7, there is no dilution impact on our modeled numbers at present. Our initial take on the CB issue is that it is slightly positive to the company's financials as it can lock the company's interest costs in face of a potential interest rate hike. We leave our model, rating and PT unchanged.

Share capital enlarged by 10% if fully issued and converted: Details of the CB are shown in the exhibit below. We would like to highlight: (1) the conversion price of HK$7.03 is ~20% above the current share price and 5% above our PT of HK$6.7. (2) Fufeng will pay Rmb37mil-46mil of CB interest expense (settled in US$ in cash semi-annually), but we believe that this will largely be offset by an interest saving from a lower bank borrowing. The CB coupon rate is 4.5%, lower than the company's current borrowing rate (~6%, according to management). We believe the CB can help fix the company's interest costs in face of a potential interest rate hike.

-----------------------------------------------------------
Gross Proceeds                     Rmb 820mil - Rmb 1025mil
                                 (~US$ 120mil - US$ 150mil)
No. of new shares to be issued              132.6-165.7 mil                      
% Increase                                         8% - 10%
-----------------------------------------------------------
Annual Coupon rate (%)            4.5% (paid semi-annually)
Conversion Price (HK$)                                 7.03
Maturity                          Five years (Due Apr 2015)
CB Holder's Put Option           At year 3 (1st April 2013)
CB Listing                        Singaopore Stock Exchange
Use of Proceeds              Expansion capex, M&As, General
                                            working capital
-----------------------------------------------------------

Source: Company

For a better understanding, we have also calculated below the potential dilution impact on the company's EPS if the CB is fully converted now. However, as both the share price and PT is below the conversion price, there should not be any dilution due to the new shares to be issued from the CB conversion.
Potential Impact

-----------------------------------------------------------
Our current estimates                       FY10      FY11
Net Profit (Rmb mil)                        1049      1531
EPS (Rmb)                                   0.63      0.82
Impact (if Optional bonds issued in full)
Net Profit (Rmb mil)                        1,033     1,341
EPS                                         0.57      0.73
EPS dilution effect                        -10.2      -10.5
-----------------------------------------------------------

Source: Piper Jaffray Asia Securities

PRICE TARGET AND JUSTIFICATION:

We rate Fufeng Overweight with a PT of HK$6.7 (9.4x FY10E EPS of HK$0.72).

For the complete Fufeng Group Research Report, please refer to the following link:

http://www.abnnewswire.net/media/en/docs/62855-PJ-Mar-10-(100329).pdf

Link: http://www.abnnewswire.net/media/en/docs/62855-PJ-Mar-10-(100329).pdf

About Fufeng Group Limited

Fufeng Group Limited (US:FFNGY)(HKG:0546) is one of the leading vertically integrated manufacturers of corn-based biochemical products principally utilising fermentation technology in China, and mainly engaged in MSG related products and xanthan gum production. MSG segment includes production of MSG, glutamic acid, fertilisers, corn refined products and sweeteners. Fufeng is the largest glutamic acid manufacturer in China, and one of the top three leading xanthan gum manufacturers in the world.

Please visit the Company website for more details:
http://www.fufeng-group.com

Contact

Fufeng Group Limited Carine Wong Tel: +852-3185-0300 carinewong@fufeng-group.com.hk

Related Companies

>>>        Fufeng Group Limited
>>>        Piper Jaffray Companies

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ANALYSIS-China to set gold market alight as it opens up 06 Aug 2010 09:50

(Repeats story issued on Thursday)

* China liberalises domestic market, lures foreign players

* China's move seen positive, government eyes 2nd tier banks

* Investors shift money out of property markets

By Lewa Pardomuan and Langi Chiang

SINGAPORE/BEIJING, Aug 5 (Reuters) - China's moves to free up its gold market open the way for foreign players and local banks to tap growing demand for the precious metal, offering citizens a more attractive investment and promising to boost the country's clout over global prices.

With the Shanghai Composite Index <.SSEC> down 20 percent this year, and gold prices <XAU=> still up 9 percent despite a correction from a lifetime high hit in June, more retail investors are buying bullion as they diversify their wealth.

A clampdown on rampant property speculation could also drive investors to shift some hot money into gold, which many see as a sign of status and good fortune, as hopes for more Chinese demand pushed gold to a two-week high above $1,200 an ounce this week.

"What's happening in China right now is that a lot of wealth is being switched out of the property markets into the gold market," said Mark Pervan, senior commodities analyst at ANZ in Melbourne.

"This is an ongoing theme. This theme is likely to put a very high floor of price on the gold market. The property investor is very concerned the government is trying to cool that market. They've made a lot of money in property."

Investors have long bet that China will eventually overtake India as the world's top consumer, and Beijing's move to allow more domestic banks to export and import bullion underscores the hunger for gold among the country's burgeoning middle class.

More foreign firms are likely to become members of the Shanghai Gold Exchange <SGE/MENU> and analysts also expect Beijing to ease curbs on gold investment products such as exchange traded funds.

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^

For a graphic of gold prices versus the Shanghai Composite

Index, click:

http://graphics.thomsonreuters.com/gfx1/LWP_20100508120808.jpg

For a graphic of demand for gold jewellery and investment in

China and other main consumers, click:

http://graphics.thomsonreuters.com/F/08/CN_GOLD0810.jpg

For a six-week gold technical analysis, click [ID:nSGE66Q0DL]

For a factbox on the top 50 official sector gold holders,

click [ID:nLDE66C11E]

For a factbox on how to invest in gold and key price drivers,

click [ID:nLDE6600NC]

For a factbox on precious metals holdings of exchange-traded

products, click [ID:nLDE6721DV]

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>

SHARE OF GLOBAL GOLD DEMAND JUMPS

Although China is the world's largest gold producer, it still requires imports as demand can easily outstrip domestic output by more than 100 tonnes annually.

China's share of global gold demand jumped to 11 percent in 2009 from 5 percent in 2002, when the Shanghai Gold Exchange opened, and consumption is likely to double in the next decade from around 420 tonnes as income grows, the World Gold Council says. [ID:nTOE62S01M]

The People's Bank of China said on Tuesday it would allow banks to hedge bullion positions in overseas markets, urge banks to lend more to domestic gold firms looking to go abroad, and actively develop more yuan-denominated gold derivatives. [ID:nTOE67207V]

China is likely to let second-tier institutions such as Minsheng Banking Corp <600016.SS> and China Merchants Bank <600036.SS> join forces with four major state banks, including Bank of China, that are already allowed to offer such services -- bringing the number to at least eight.

"China's gold market is going to play an important role in the global gold market," said Albert Cheng, Far East managing director of the World Gold Council.

"It will become more accessible for both international and domestic players. Investors in China will benefit from greater availability of physical gold and gold-related financial products. Naturally this is very positive for gold."

Analysts say China wants more banks to trade with overseas counterparts, reduce their reliance on the Shanghai Gold Exchange for hedging and invite more foreign banking institutions to trade on the Exchange, where trading volumes have risen by more than half in the first half of this year.

Five banks, including HSBC <HSBC.L> and Standard Chartered <STAN.L>, are members of the Shanghai Gold Exchange.

WILL CHINA BOOST RESERVES?

Most gold investors trade via the Exchange but banking sources say more clients are chasing products such as gold saving accounts and gold bars while hedging services to miners have gone up -- suggesting a shift from equities or property markets.

Beijing has repeatedly stressed its determination to curb speculative demand and rein in overly fast price rises in the real estate market despite a slowdown in economic growth. [ID:nBJ003894]

"Investment demand for gold is expanding very fast, as we are now in a bull market and prices will rise in the mid- and long-term," said a wealth manager specialising in precious metals at a state bank in Guangzhou.

"No matter if it's the stock, property or gold market, Chinese people always flock in when prices are rising."

Will China boost reserves after announcing the new measures? The answer may be no because Beijing will focus on bringing more gold into the country to satisfy demand, rather than stirring up global prices through official purchases.

China has increased its official gold holdings by more than 400 tonnes in the past few years to 1,054 tonnes -- the world's sixth largest.

"The PBoC comments should not be taken as a sign the official sector will buy gold, but rather that current restrictions on gold imports and gold investment products, such as exchange-traded funds, will gradually ease," HSBC said in a report.

Indeed, business is booming in downtown Beijing.

"There has been a big jump in interest in gold over the past year," said Zhang Qi, a salesman surrounded by gold commemorative items on display in a store of China Golddeal, the country's only official minting company, on Financial Street.

"Everybody can see how the government is trying to control the real estate market, so there is more confidence that gold is something that will be able to hold its value. Parents want to pass gold on to their children because they think it is safe." (Additional reporting by Polly Yam in HONG KONG; Editing by Clarence Fernandez and Ramthan Hussain) ((lewa.pardomuan@thomson reuters.com; +65 6870 3834; Reuters Messaging: lewa.pardomuan.reuters.com@reuters.net)) ( (If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com))

Keywords: GOLD CHINA/

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RPT-BUY OR SELL-Singapore healthcare sector-Healthy or feverish?

Related Symbols:

SGX - RAFFLES MED GRP R01 SGX - THOMSON MEDICAL 5FV SGX - PARKWAY HLDGS LT P27 SGX - HEALTHWAY MEDI 5NG

RPT-BUY OR SELL-Singapore healthcare sector-Healthy or feverish? 03 Aug 2010 10:21

(Repeats Aug 2 story with no changes to text) * Health sector index up as much as 23.4 pct since May * Shares have risen between 20 pct to 50 pct year to date * Strong fundamentals with ageing population, regional demand (For more Reuters buysells click [BUYSELL/]) By Eveline Danubrata SINGAPORE, Aug 2 (Reuters) - Singapore's healthcare sector, up more than a quarter this year, may be running ahead of fundamentals, boosted by a bidding war for Asia's biggest listed hospital operator Parkway Holdings <PARM.SI> The Singapore stock exchange's health sector index <.FTFSTAS4000> has jumped as much as 23.4 percent in a rally which started at the end of May when Malaysia's Khazanah announced its successful bid for Parkway after months of wrangling with Fortis Healthcare <FOHE.BO>. [ID:nSGE66P00J] But are Singapore healthcare stocks still a good buy? <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ For StarMine comparisons click: http://r.reuters.com/was72n ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> GOOD BUYS Singapore's healthcare firms have strong fundamentals due to the city-state's ageing population, thriving medical tourism from the region and the roaring recovery of the local economy -- set to grow as much as 15 percent this year. [ID:nSGE66C0GX] "Healthcare provision is unusual in that it is both a defensive and a growth industry, so well-managed companies in the sector can be good investments," said Peter Elston, a strategist at Aberdeen Asset Management Asia, which oversees more than $68.5 billion and holds shares in Raffles Medical Group <RAFG.SI>. "Healthcare is defensive because people always need healthcare, so demand is not cyclical. And it is a growth industry because as people get richer they spend more on healthcare," he added. Raffles Medical, which posted a 20 percent rise in second-quarter profit last week, is expanding its flagship hospital in Singapore and has opened a medical centre in Shanghai. Healthway Medical Corp <HEMC.SI> is on track to open six medical centres in Shanghai and is eyeing other cities. "The healthcare firms are generally trading at higher valuations," said Lynette Tan, an analyst at DMG & Partners. She said these valuations had not been seen for a long time "but as long as the companies can still perform and their strategies come through, they might not be that expensive at all." Tan has buy ratings on Raffles Medical, Healthway Medical and Thomson Medical. TOO RICH FOR OTHERS "We believe growth in hospital and healthcare services is starting to show a deceleration," said James Tan, an analyst at Deutsche Bank. For the year to date, shares of Parkway and Raffles Medical have surged around 35 percent. Thomson Medical Centre <THOM.SI> has risen by about 21 percent and Healthway has gained more than 50 percent, outperforming the benchmark Straits Times Index's <.FTSTI> 3 percent. Tan has a "hold" rating on Raffles Medical. He said the stock is trading above its fair value and close to its long-term average of 23.6 times. The bank's revised target price of S$1.58 implies 22.3 times Raffles Medical's price-earnings ratio for its 2010 financial year. Lau Seu Yee, a Standard and Poor's analyst, warned about the threat from a possible slowdown in the United States and Europe economies and also of competition from neighbouring countries. "There is also competition (in the healthcare sector) from lower-cost places like Johor Bahru in Malaysia, Thailand and India," Lau said. For Parkway, analysts are calling for investors to reinvest proceeds from the general offer into other healthcare firms, given their estimated price-to-earnings multiple of 31 times 2010 earnings for the firm. ($1=1.362 Singapore Dollar) (Editing by Raju Gopalakrishnan and Valerie Lee) ((eveline.danubrata@thomsonreuters.com; +65 6403 5669; Reuters Messaging: (eveline.danubrata.reuters.com@reuters.net) ((If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.co Keywords: BUYSELL/SINGAPOREHEALTH

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