VIEWPOINTS EXPRESS

Weekly Macro Monitor

    Hindsight and forethoughts

    The dip in Chinese exports during February could weigh on market sentimentand keep investors on a cautious stance ahead of the key economic releasesdue Thursday. However, seasonal factors and high-base effect might havecontributed to the weaker trade performance in February. Despite a downsiderisk to economic outlook, the officials have shown a clear resolution tomaintain a steady macro environment this year by keeping its growth targetunchanged at 7.5% while deepening reform. The first onshore bond defaultcase emerged last week could be another development demonstrating thegovernment’s determination to move forward to a market-based economy,although it could cause market to re-price Chinese credit risk.

    Kingsoft (3888.HK, BUY, TP HK$35.00)

    Transition Toward Internet Platform with Spin-off & Tie-ups

    We initiate coverage on Kingsoft with BUY and TP of HK$35. We expectcompany would enjoy stellar growth in online game, advertising, WPS andmobile internet business. Famous for its mobile application of Clean masterand Battery doctor, company scheduled spin off of KIS (Kingsoft InternetSoftware Holdings), aims for US$3 bn offshore IPO in 2014. As a marketleader, we believe Kingsoft would further differentiate itself from the pack andcontinue to capture a disproportionate amount of spending.