EMERGINGMARKETCORPORATES：CORPORATECREDITTRENDSFAIRLYROBUST／CHALLENGESEMERGE1023

1、credit globalmarketsresearch emergingmarkets global 22 october 2012 emerging market corporates corporate credit trends - fairly robust/challenges emerge quarterly credit ratio trends: by region and sector in this publication, we analyse the historic trends for some of the main credit ratios that hav

2、e defined the fundamental performance of ceemea and latam corporates, with the purpose of understanding how resilient the companies across industry sectors have been in the most recent downturn of the global commodity prices and macroeconomic trends versus the previous instance in 2008/09. figure 1

3、below implies that ceemea industrials currently are fairing better than their latam peers in terms of net leverage; though we highlight that this is not a sector- wide trend and that the full picture can only be ascertained by examining the evolution of a complete spectrum of ratios, as we do in the

4、 body of this report. financing needs: corporates quarterly frr trends we provide an overview of the evolution of global corporate and banking financing requirements (frrs) across ceemea and latam. we believe that the frrs have been very useful, dependable indicators of corporate financing needs, in

5、 focusing on the degree of sustainability of individual corporate, and aggregated sectors cash flow cycles and therefore at highlighting the sectors that could need to cut spending or raise new funding in the near-term. credit ratings structure and outlook for em; commodities overview included figur

6、e 1: ltm net leverage historic trend for em corporates 2.0 1.8 1.6 1.4 1.2 1.0 0.8 0.6 periodical research team denis parisien research analyst (+1) 212 250-7568 viacheslav shilin, mba research analyst (+44) 20 754-79035 tala boulos research analyst (+44) 20 754-53664 natalia corfield research analy

7、st (+1) 212 2506135 jed evans strategist (+1) 212 250-8605 3q082q091q104q103q112q12 emeagloballatam source: deutsche bank figure 2: capital adequacy ratio (car) historic trend for em banks 22% 20% 18% 16% 14% 4q073q082q091q104q103q112q12 emeagloballatam source: deutsche bank deutsche bank securities

8、 inc. all prices are those current at the end of the previous trading session unless otherwise indicated. prices are sourced from local exchanges via reuters, bloomberg and other vendors. data is sourced from deutsche bank and subject companies. deutsche bank does and seeks to do business with compa

9、nies covered in its research reports. thus, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. investors should consider this report as only a single factor in making their investment decision. disclosures and analyst certificati

10、ons are located in appendix 1. mica(p) 072/04/2012. 22 october 2012 page 2 emerging market corporates table of contents global financing needs. 3 main conclusions . 3 global credit trends overview . 8 em corporates. 8 consumer although we expect the ratio to rise slightly in 2h12 mainly driven by ca

11、pex cycle in ceemea. this deutsche bank securities inc.page 3 22 october 2012 page 4 emerging market corporates could be at least partially offset by the positive seasonality of brazilian protein companies in 4q and by some refinancing/maturity extensions that we expect in this regions sector partic

12、ipants. there is risk however of heavy wc usage in the us operations of latam companies, exposed to high grain prices/raw material scarcity. the gradual increase of the frr for the tmt sector since mid-2011 is, in our view, a reflection of continued m mainly in ceemea, which we expect to remain the

13、case in the next 6-12 months. the collapse in the latam hy operating margins and high cash burn has been a contributing factor as well. the frr trend for the metals while cumulative net cash flow declined to usd177.4bn in 2q12 from usd238.2bn a year earlier much more gradual changes. in our view, th

14、e pace of growth of the ceemea bank frr ratio in 2h12 should abate following the surge in new bond supply in october-to-date, which should help smooth out the above-mentioned st debt repayments. more new issues are also expected from latam banks in the run-up to the application of basel iii and in t

15、he wake of other capital markets transactions. deutsche bank securities inc. 1q102q103q104q101q112q113q114q111q12 1q102q103q104q101q112q113q114q111q122q12 2q12 22 october 2012emerging market corporates figure 3: quarterly frr by sector 4 3 2 1 0 cement construction while keeping capex spending under

16、 control. for the m though low capex should to some extent provide a buffer. the main culprits behind this reduced cash generating capacity that started in 4q11 were the oil with the number of upgrades and downgrades evenly split. financial institutions accounted for 32.9% of the 1,002 actions on re

17、cord within our sample period (1q08-3q12); with positive actions for the sector representing 16.7% of the total and negatives at 16.3%.the utilities and consumer sectors were the second most active industries. generally, a steady increase in upgrades was exhibited from 1q10 to 4q11. in 2012 to-date,

18、 a shift in the ratings evolution has been evident as downgrades outpaced upgrades; with the financial segment continuing to be the main contributor. this sector experienced record negative rating actions in june relative to the data sample (1q08-3q12). our expectation that this trend will abate by

19、4q12 led to an increase in our buy recommendations in the sector in our last em corporate quarterly publication on oct 1, 2012. utilities and consumer sector companies have registered quite polarised dynamics: greater proportion of downgrades for the former versus more upgrades for the latter. the c

20、onstruction, oil with the share of negative outpacing the positive ones. between 1q08 and 3q12, banks accounted for 61.5% of the 1,109 actions recorded during the period, of which upgrades represented 16.0% and downgrades stood at 45.5% of the total. metals although the oil though a pick-up in the m

21、omentum has been evident during 3q12. the positive rating actions have been broadly evenly split across the segments (excluding banks) in the past three quarters; with no particular dominant trend visible for any given sector at this stage. deutsche bank securities inc.page 21 numberof actions jun10

22、 dec09 jun09dec10 oct09 jun11 dec11oct11oct10feb11feb12aug09aug11 jun12 2q12 2q12 feb10 apr10 aug10apr11apr12 numberofactions 1q08 2q08 3q08 4q08 1q09 2q09 3q09 4q09 1q10 2q10 3q10 4q10 1q11 2q11 3q11 4q11 1q123q12 3q12 numberofactions 1q08 2q08 3q08 4q08 1q09 2q09 3q09 4q09 1q10 2q10 3q10 4q10 1q11

23、 2q11 3q11 4q11 1q12 aug12 22 october 2012emerging market corporates figure 43: rating changes by region since june 2009 50 40 30 20 10 0 -10 -20 -30 -40 -50 -60 -70 latam u pgrades downgrades emea source: deutsche bank, bloomberg finance lp figure 44: latam ratings by industry since 1q08 55 35 15 -

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