Asia Securities

Normalising footfall offset by improving volumes, supporting Retail revenues. Price growth to taper down; volumes to drive Manufacturing revenues in 2H. Lower cost base and higher prices to support margin expansion in 2H.

Price increases to ease; volume recovery to drive revenues in CY23E. EBIT margins to remain above historic levels as opex normalises in CY23E. Higher interest costs in CY23E partly offset by increased interest income.

Government tax proposals to support IMF discussions; negative impact on consumer spending power. Mobility levels remain steady during the month; Manufacturing, Services PMIs show mixed results. Inverted yield curve indicates higher short-term risk; y...

Revenue base expanded; expenditure proposals remain a key priority. Personal income tax changes further widen tax net and burden on higher income earners. Corporate tax revisions and affected counters; export counters to see least impact.

CB maintains rates; FX liquidity in the banking system continues to improve. Inflation to gradually ease as supply side pressure improves. Reserves at USD 1.8bn in September including USD 1.4bn swap; we factor in an IMF EFF in January 2023.

CBSL commences creditor discussions; IMF Board agreement a crucial factor. GDP: 2Q reflects impact from multiple headwinds; 2H 2022 to improve faster than our initial expectations. Mobility remains consistent on the back of continuous fuel supply.