Fixed Income Daily Market Update
CMBI Credit Commentary Fixed Income Daily Market Update固定收益部市场日报 Flows were still light this morning. Asian IG spreads were largely unchanged.We saw light two-way flows on front-end AT1s and insurance subs. EHICAR26 leaked 1.1pts. NANFUN 5 Perp was 0.5pt lower. WESCHI 28-29 gained0.5-1.1pts. GLPCHI 29/FAEACO 12.814 Perp edged 0.4pt higher. Glenn Ko, CFA高志和(852) 3657 6235glennko@cmbi.com.hk MEDCIJ:Rising oil and gas prices, aswell as strong volume supported1Q26 earnings growth.Maintain buy on MEDCIJ 29-30. MEDCIJs wereunchanged this morning. See below. Cyrena Ng, CPA吳蒨瑩(852) 3900 0801cyrenang@cmbi.com.hk INDYIJ:Indika Energy tapped USD100mn INDYIJ 8.75 05/07/29 at par, theoutstanding amount increased to USD555mn. INDYIJ 29 was 0.2pt lowerthis morning. Yujing Zhang张钰婧(852)3900 0830zhangyujing@cmbi.com.hk Trading desk comments交易台市场观点 Yesterday,flows were light across all spaces as Japan and Mainland Chinawere out for holiday. In the Middle East, TAQAUH 51 edged 0.6pt higher. Onthe other hand, SECO 29-36/BSFRs/FABUH 34-35 were unchanged to 0.2ptweaker. EBIUH Perps were 0.3pt lower to 0.2pt higher. See our commentson the recent new issue EBIUH 6.25 Perp on29 Apr’26. In HK, FAEACO12.814 Perp gained 0.5pt. The NWDEVL/VDNWDL complex were overallunchanged to 0.3pt higher. LIFUNG 5.25 Perp gained 0.1pt. Fitch affirmed Li& Fung’s BB rating with a stable outlook. In Macau gaming, MPEL 27 lost0.1pt, while SANLTD 28/STCITY 29/WYNMAC 29 were 0.1pt higher. Therest of the space closed unchanged. See our commentsyesterdayon Macaugaming 4M26 GGR and MPEL/STCITY 1Q26 results. CWAHK 30 lost 0.1pt.See our comments on30 Apr’26. In Chinese properties, VNKRLE 27-29/FUTLN 28/FTLNHD 27-29 closed 0.1pt higher. LNGFOR 27-32 gained0.2-0.3pt. In SE Asian space, GLPSPs/GLPCHI were 0.3pt lower to 0.1pthigher.VEDLN 28-33s traded up to 0.3pt higher. The ReNew Energycomplex and MEDCIJ 26-30 were unchanged to 0.1pt higher. See commentsbelowon Medco Energi 1Q26 results.TOPTB/PTTGC Perps wereunchanged to 0.2pt higher. In JP space, SOFTBKs were up to 0.6pt firmer.SoftBank plans to establish and list AI robotics business in the US atUSD100bn valuation. As for Japanese and Yankee AT1s, NOMURA 7Perp/STANLN 7 Perp were 0.1pt firmer. Last Trading Day’s Top Movers Marco News Recap宏观新闻回顾 Macro–S&P (-0.41%), Dow (-1.13%) and Nasdaq (-0.19%) were lower on Monday.UST yield was higher onMonday. 2/5/10/30 year yieldwas at 3.95%/4.08%/4.45%/5.02%.. Desk Analyst Comments分析员市场观点 MEDCIJ:Rising oil and gas prices, as well as strong volume supported 1Q26 earnings growth We maintain buy on MEDCIJ 8.96 04/27/29 and MEDCIJ 8.625 05/19/30, in view ofMedco Energi (Medco)’sresilience operating performance, financial discipline in expansion and sufficient liquidity profile. At 103.7 and104.7, MEDCIJ 8.96 04/27/29 and MEDCIJ 8.625 05/19/30 are trading at YTM of 6.7% and 7.3%, respectively.We considerthese bonds are lower-beta and good carry plays. We expect Medco to continue early redeem itsUSD bonds.As per Medco, it repurchased USD bonds of USD2.9mn in 1Q26.This, coupled with notablyhigher O&G prices, should support the near-term performanceof MEDCIJ 29-30. Medco’s 1Q26 revenue rose 19.2% yoy to USD668.3mn, driven by higher oil & gas volumes from additionalworking interest in Corridor and new production from Forel and Terubuk fields and higher oil prices. Oil & gassegment revenue rose 21.0% yoy to USD616.5mn. The average realized price for oil increased to USD75.1/bbl(1Q25: 72.2/bbl), and the daily lifting also increased to 48mbopd (1Q25: 41mbopd).The realized oil pricesincreased to USD94.0/bbl in Mar’26 amid the US-Israel war againstIran and closure of the Strait of Hormuz.Moreover, the gas average realized price in 1Q26 increased to USD7.2/mmbtu (1Q25: 7.1/mmbtu), and thedaily lifting in the quarter increased to 627bbtupd (1Q25: 532bbtupd). Overall, the oil & gas production run-ratewas 169mboepd in 1Q26, in line with Medco’s FY26 guidance of 165-170 mboepd. As for the power segment, revenue was down 2.2% yoy to USD43.4mn.The 20.9% yoy in power sales fromimproved reliability of Dalle Energy Batam, Energi Listrik Batam expansion and other assets were offset by adecrease in construction revenue after completing Ijen Geothermal and East Bali Solar PV in 2025. That said,Medco achieved power sales of 1,053Gwh in 1Q26, representing c23% of the its FY26 guidance of 4,550Gwh. Thecompany is on track to achieve its power sales target. In 1Q26, the power segment contributed c6.5% ofMedco’s revenue. Medco’s 1Q26 EBITDA was up 5.7% yoy to USD349.1mn.The higher production volumes and improvedrealized oil and gas prices were partially offset by higher cash cost at USD9.0/boe (1Q25: 7.9/boe). The highercash cost,however, remains in line with its FY26 guidance of below USD10/boe. PBT, on the other hand,jumped 63.0% yoy to USD149.7mn as Amman Mineral Internasional (AMMAN) turned into profit of USD34mnin 1Q26 from losses of USD29mn in 1Q25 after the smelter had ram
