< The 2015 All-Asia Research Team
Total appearances: 8
Team debut: 2005After three consecutive years at the top of this list, UBS falls to second place. Even so, the ten-person squad that Young Chang and Yankun Hou oversee continues to deliver research that is “extremely timely and deeply probing,” one supporter avers. Hou, 43, works out of Hong Kong and also directs a group that merits a runner-up position for its coverage of China. He reports that the team expects sales volume for Chinese automobiles to deteriorate from the second half of this year through the first six months of 2016. “Then the industry will face severe price competition, thus margin pressure,” notes Hou. In this environment, Hong Kong–headquartered Brilliance China Automotive Holding should be a standout in 2016, the analysts believe, “thanks to stable growth of luxury car sales, new product launches and improving localization rate.” They boosted their rating on the stock from neutral to buy in January, citing its cheap valuation and the manufacturer’s stable earnings growth. By the end of last month, Brilliance China had risen 21.7 percent, to HK$14.70, besting its regional peers by 19.8 percentage points. From his base in Seoul, co-captain Chang, 53, also guides a crew that claims a runner-up spot on the South Korea lineup. “We prefer [South Korean] automakers, given the low valuations after a substantial price correction, while their dividends will likely continue to rise,” he advises. Indeed, during the 12 months through April, the country’s autos and auto parts shares tumbled 20.5 percent, which was worse even than the regional group’s decline of 6.6 percent — and far behind the Chinese subsector’s gain of 37.4 percent. “The currency will remain the key issue for the stocks. If the Russia ruble and Brazilian real stabilize or appreciate following a sharp weakness, it would be positive,” Chang adds. “How the dollar moves in light of U.S. monetary policy will be also important.”