What’s Changed, Research Focus, Today’s Events

First Light Asia What’s Changed, Research Focus, Today’s Events Ticker Company Rating was Currency Target was EPS '13a EPS '14e Price Price At Close New 1339 HK PICC Group OW(V) HKD 5.1 3.9 15 Jan 2328 HK PICC P&C N(V) HKD 17.1 15.4 15 Jan Up DFI SP Dairy Farm N UW USD 9.50 10.7 0.35 0.34 8.92 16 Jan Down 601628 CH China Life-A UW(V)OW(V) RMB 28.0 24.0 36.2 15 Jan 601336 CH New China Life-A UW(V)N(V) RMB 37.0 30.0 49.9 15 Jan MMFS IN Mahindra & Mahindra Finance UW N(V) INR 216 246 15.7(a) 286 19 Jan 2628 HK China Life-H N(V) OW(V) HKD 34.0 30.0 31.7 15 Jan 601601 CH China Pacific-A N(V) OW(V) RMB 40.0 34.0 33.6 15 Jan 1336 HK New China Life-H N(V) OW(V) HKD 46.0 39.0 43.2 15 Jan INTP IJ Indocement UW(V) IDR 16,500 19,300 1336.81 1363.04 22,300 16 Jan Source: Bloomberg, HSBC estimates Click on title to open reports Research Focus Hong Kong economic outlook - Time to take the next step John Zhu  We forecast GDP growth of 2.8% this year, better than 2014 but below the average before the 2008 financial crisis  Inflation and unemployment are back to normal levels, so Hong Kong can cope with US Fed policy tightening in 2015  As a mature economy, Hong Kong’s long-term economic growth will depend on education, innovation and R&D China Strategy - Back to fundamentals, better value in H shares Steven Sun*  The uncontrolled growth of margin financing is a policy concern  No rush to bottom fish the A-share market as the 2nd leg up has to be supported by improvement of fundamentals  Turning positive on H-share brokers after big correction and on big discount, having suggested profit-taking a month ago on valuation China Insurance - Time to be selective James E Garner*  Time to be selective; preferred insurers are China Pacific-H and Ping An-H  Only a migration from P/EV to the Appraisal Value method would support significant share price upside potential  We downgrade five stocks, which moves our sector OW/N/UW ratings spread from 89%/11%/0% to 45%/36%/18% Indonesia Cement - Price cut leads to 15-40% cuts in TPs Shishir Singh*  We factor the impact of cement price cuts announced by the government  Cut our below-consensus estimates by 13-39%; 2015e EPS to fall by 17-52%  We cut our TPs by 15-40%; reiterate UW on SMGR, UW(V) on INTP and SMCB 20 January 2015 Ticker Event Rating Target Price Ticker Event NI Bbg Kotak Mahindra Bank KMB IN Q3 OW1,253.00 1,400.4 Johnson & Johnson JNJ US Q4102.5China GDP 4Q-2014 7.6% Taiwan Export Orders Dec 1.9% Source: Bloomberg, HSBC estimates Colin Davis* Head of Research Marketing Asia +852 2996 6635colindavis@hsbc.com.hk*Employed by a non-US affiliate of HSBC Securities (USA) Inc, and is not registered/qualified pursuant to FINRA regulations Issuer of report: The Hongkong and Shanghai Banking Corporation Limited View HSBC Global Research at: http://www.research.hsbc.comDisclaimer & Disclosures This report must be read with the disclosures in the Disclosure appendix, and the Disclaimer, which forms part of itDisclosures for companies can be accessed via the hyperlinks to the original published research, which can be found in the title THIS CONTENT MAY NOT BE DISTRIBUTED IN THE PEOPLE'S REPUBLIC OF CHINA (THE "PRC") (EXCLUDING SPECIAL ADMINISTRATIVE REGIONS OF HONG KONG AND MACAO) First Light Asia 20 January 2015 abcRegional Asian FX - Trade recommendation update Paul Mackel  We take profit on our short EUR-INR 1m NDF trade recommendation at 71.50 for a nominal gain of 4.7% to our EM FX portfolio*  Meanwhile, we have been stopped out of our short USD-CNH 12m position at 6.4170 for a nominal loss of 0.45% to the portfolio.  Closing these two positions means our only current open position is short TWD-THB 1m NDF, with the position currently 0.2% in the money Australian CPI Preview - Lower oil prices to drive CPI inflation down Paul Bloxham Bank of Japan Watch - Caught in the oil slick Izumi Devalier China & Hong Kong Macau Gaming Weekly - Run rate flat w-o-w, despite being bo