New horizons 9 key themes to guide your outlook - HSBC Global Research
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
New horizons 9 key themes to guide your outlook
HSBC Global Research • 9 key themes to guide your outlook www.research.hsbc.com | 2
Introducing our themes
HSBC Global Research is taking a new approach to investing in
today’s world of disruptive, complex and rapid change. We are
applying our multi-asset and geographical reach to understand the
big events unfolding today and their investment implications through
nine big themes.
From Disruptive Technology and Future Cities to Demographics and
the Energy Transition, this brochure explains our nine big themes and David May
how to access them. Global Head of Research
david.may@hsbc.com
Watch video ›
Got a question or Follow on LinkedIn
want to know how to
subscribe, just email us at
askresearch@hsbc.com
View David’s profile
PUBLIC
HSBC Global Research • 9 key themes to guide your outlook www.research.hsbc.com | 3
Our products
Positioned across our unique selling points and focusing on our key, current and topical themes
Global teams
Economics FX broad Equities 1,900 Fixed Income EM investment ESG insights to Data Science Multi-Asset
covering >50 coverage of DM & companies with covering Rates themes across aid investment analysing vast highlight key
countries EM FX with focus 60% MSCI EM & and Credit across asset classes decisions amounts of data using ideas across asset
worldwide on the RMB FM indices DM & EM Machine Learning classes
techniques
USPs
Macro/ Emerging Asia China UK ESG Data
Multi-Asset Markets Science
Top rated EM and Comprehensive analysis Local expertise for IBCN JV with 300+ Strong mid-cap 10+ years of integrating Embedding Machine
thematic coverage of EM across all asset global clients A-share coverage coverage ESG with fundamental Learning techniques in
classes investing investment advisory
Big themes
Automation Demographics Digital Finance Disruptive Energy Future Cities Future Future Transport Lower for
Technology Transition Consumer Longer
PUBLIC
HSBC Global Research • 9 key themes to guide your outlook www.research.hsbc.com | 4
Meet the themes
Click on the icon to see the latest insights
Automation Demographics Digital Finance
Helen Fang (Global) James Pomeroy (Global) Kailesh Mistry (Global)
Sean McLoughlin (Europe) Herald van der Linde (Asia) Antonin Baudry (Europe)
Edward Stanford (Europe) Neha Agarwala (Americas & EEMEA)
Disruptive Technology Energy Transition Future Cities
Davey Jose (Global) Sriharsha Pappu (Global) Stephen Bramley-Jackson (Global)
Frank Lee (Asia) Thomas C. Hilboldt (Asia) James Pomeroy (Europe)
Lilyanna Yang (Americas)
Jonathan Brandt (EEMEA)
Future Consumer Future Transport Lower for Longer
Erwan Rambourg (Global) Henning Cosman (Global) Steven Major (Global)
Ravi Jain (Americas & EEMEA) Will Cho (Asia) Lawrence Dyer (US)
Karen Choi (Asia)
Jeremy Fialko (Europe)
PUBLIC
HSBC Global Research • 9 key themes to guide your outlook www.research.hsbc.com | 5
Automation
Watch list
® In logistics, we
estimate only 5% of
warehouses currently
have incorporated
Driven by the potential to increase productivity, automation has advanced from early mechanisation automation
of production lines to today’s data-driven industrial Internet of Things (IoT). Already well established ® Automation has
advanced from early
in general manufacturing and process industries, automation has huge growth potential in sectors mechanisation of
with lower penetration, such as logistics production lines to
today’s data-driven
industrial IoT investment
Robotics: Smarter robot riding on IoT tackles ageing workforce Machine Vision: Secular growth and software driven ® Machine vision
software is the high-
Already well established in general manufacturing and process Machine vision offers higher precision and consistency than human value part of the
industries, automation has huge growth potential in sectors with lower labour on quality inspection tasks. industry and provides
penetration. The graph below shows the number of installed industrial leaders with faster
robots per 10,000 employees in the manufacturing industry, 2018 With increasingly complex, precise manufacturing demands, and rising growth and superior
focus on quality, machine vision offers better yields, higher efficiency returns
and lower labour cost for manufacturing industries.
® 85% – share of
Singapore 831
industry taken by vision
South Korea 774 software, while the
other 15% is taken by
Germany 338
Pursuit of productivity vision hardware such as
Japan 327 cameras
Sweden 247 ® Vision-guided robotics
Global average density: 99 and automated
Denmark 240
Asia average density: 91 optical inspections
Demand for
Taiwan 221 are two of the major
Rising labour Machine Vision Ageing applications of machine
US 217 costs population
China’s robot density is vision in manufacturing
Italy 200 industries
still below many industrial
Mainland China 140 economies (2018)
Source: IFR, CRIA & HSBC Source: HSBC
PUBLIC
HSBC Global Research • 9 key themes to guide your outlook www.research.hsbc.com | 6
Automation
Key insights
Equities EQUITIES
Equity Research Report EQUITIES INDUSTRIALS
Industrials Electronic Equipment & Instruments INDUSTRIALS November 2017
January 2018
February 2021 May 2020
By: Helen Fang www.research.hsbc.com By: Michael Hagmann, Debashis Chand and Helen Fang https://www.research.hsbc.com
By: Amy Hu (S1700520090001), Corey Chan (S1700518100001) www.research.hsbc.com
By: Helen Fang, Michael Hagmann, Richard Schramm and Anderson Chow https://www.research.hsbc.com
S P O T L I G H T
SPOTLIGHT
Prometheus unbound
Title of report
Global Robotics
China Automation Global Machine Vision Global Robotics
Global Machine Vision
Automation nation: Robots lead the Global Industrials – Automation goes digital
Initiate coverage: Acing China’s automation ambition The eyes of robots: it’s all about algorithms
charge in China
The pandemic and China’s push to Machine vision – which enables Industrial IoT will drive more than a
be more self-sufficient are pushing robots to see – has the most secular third of IoT benefits of USD4trn to
Demand for robots in China is going USD11trn (by 2025). The necessary
manufacturers to invest more in growth of any sector in the factory
into overdrive as more industries need capex requirements will amount to
automation… automation industry
higher levels of automation USD100bn to USD300bn pa
…with domestic automation leaders We see software – especially
We believe Japanese giant FANUC (Buy)
well-positioned to take market share algorithms – as the key differentiator Rockwell Automation, Schneider
has the best growth story and look at its
from global peers for companies and it accounts for Electric and Siemens have the
expansion in the Chinese market
85% of the industry value most refined offerings today.
Initiate on automation leader Inovance Siemens’ approach is more
As production expands rapidly, China
Helen Fang
Equities // Subcategory
Asset // Subcategory
Equities // Industrials
at Buy (our top pick), relay-focused The ongoing search by manufacturers revolutionary in nature
robot makers are trying to narrow the
Hongfa at Buy, and more slowly for yield enhancement, cost savings knowledge gap through acquisitions
We prefer Siemens (Buy) and
Equities | Electronic Equipment & Instruments
growing Siasun at Hold and labour replacement is driving
penetration especially in electronics, Schneider Electric (Buy)
semiconductor, 5G and healthcare
Head of Industrials Research,
APAC and Global Coordinator for
Play interview with
Automation
Play video with
Helen Fang
Helen Fang
January 2018
helen.c.fang@hsbc.com.hk
Month 20xx
May 2020
Disclaimer & Disclosures: This report must be read with the disclosures and the analyst
Disclosures & Disclaimer: This report must be read with the disclosures and the analyst certifications in Disclosures & Disclaimer: This report must be read with the disclosures and the analyst certifications in Disclaimer & Disclosures: This report must be read with the disclosures and the analyst
certifications in the Disclosure appendix, and with the Disclaimer, which forms part of it
the Disclosure appendix, and with the Disclaimer, which forms part of it. the Disclosure appendix, and with the Disclaimer, which forms part of it. certifications in the Disclosure appendix, and with the Disclaimer, which forms part of it
China Automation Global Machine Vision Global Robotics Prometheus unbound
Initiate coverage: Acing The eyes of robots: it’s all Automation nation: Robots Global Industrials – Follow on LinkedIn
China’s automation about algorithms lead the charge in China Automation goes digital
ambition
Read report › Read report › Read report ›
Read report ›
View insights
Watch on LinkedIn
New horizons for 2021: Our key themes from HSBC Global Research Subscribe to theme
Watch ›
PUBLIC
HSBC Global Research • 9 key themes to guide your outlook www.research.hsbc.com | 7
Demographics
Watch list
® By 2025e, India should
overtake China as the
most populous nation
® Mid-tier cities – this
The world’s population is seeing the fastest changes in history, with ageing populations, lower birth is where people flock
rates and smaller households set to play a key role in determining the pace and shape of global to, more so than the
larger metropoles. This
demand growth for a range of goods and services creates a new group of
consumers in lesser-
known cities across
The world’s population continues to rise with Africa overtaking Asia Most populous countries by 2030e (% proportion) Asia and Africa
17.6% 17.1%
® More women are
15bn working. This is
especially the case
Oceania
India Mainland China in China and also
Latin America
4.1% 3.5%
10bn Indonesia where more
North America
are completing higher
Africa
education and getting
Europe
managerial jobs
5bn Asia US Indonesia
® Demand for
0
1950 1970 1990 2010 2030 2050 2070 2090
3.1% 2.6% healthcare will likely
rise fastest not in
ageing societies but
Nigeria Brazil in younger nations
Source: UN Population Prospects 2019, HSBC where more people are
reaching 40
Ideas key to these long term shifts ® Focus on the
infrastructure
shrinking household.
population growth
empty-
nesters
healthcare
Education
women
This is a particular trait
shrinking household urbanisation
in North Asia – as per
mid-tier cities Global Demographics,
the number of single-
ageing population person households is
estimated to rise
PUBLIC
HSBC Global Research • 9 key themes to guide your outlook www.research.hsbc.com | 8
Demographics
Herald van der Linde, CFA
Key insights Head of Equity Strategy, APAC
and Global Coordinator of
Demographics
4 August 2020
Equity Strategy & Economics
Global
February 2021
Asia Demographics Equity Strategy
heraldvanderlinde@hsbc.com.hk
By: Herald van der Linde and James Pomeroy www.research.hsbc.com Asia
Large shifts are coming soon
Tectonic shifts ahead in the next decade; India’s population
Global Demographics should grow bigger than China, while China’s is set to shrink
Global Demographics
Meanwhile, Asians are living longer, residing in smaller
households, flocking to mid-tier cities, and saving more
Mapping out a century of changes
Follow on LinkedIn
We identify some big picture implications: empty-nesters
The epicentre of population growth trading up, a female future, and rising spending on health
will move to Africa later this century,
We build on our previous research on Asia’s demographics with a new series. This
while India is set to overtake China to
report focuses on long-term investment themes shaped by demographics, while in
become the world’s most populous the accompanying notes we work with fundamental analysts to highlight stock Herald van der Linde*, CFA
nation by 2025 opportunities, starting with the consumer sector: Asia Demographics – Tectonic shifts Head of Equity Strategy, Asia Pacific
The Hongkong and Shanghai Banking Corporation Limited
ahead for the consumer sector, 4 August 2020. heraldvanderlinde@hsbc.com.hk
We show what these vast demographic +852 2996 6575
Big changes are not only around the corner... Before the end of this decade, India Barak Hurvitz*
changes mean, why ageing is the is expected to surpass China as the world’s most populous country, which should Associate, Equity Strategy
biggest social transformation globally… swiftly be followed by China’s population declining. Markets will start to consider the
The Hongkong and Shanghai Banking Corporation Limited
barak.hurvitz@hsbc.com.hk
implications well before this happens. For instance, companies need to position +852 2996 6941
Asset // Subcategory
…and how policymakers have a themselves for slower volume growth, and instead work on their ability to raise prices Prerna Garg*
Associate
dilemma over how best to spend – possibly by offering better quality products. Bangalore
Equity Strategy | Global
on education, healthcare, jobs and …they are also happening now: Asians are getting older, living longer, and flocking
to mid-tier cities. They’re also residing in smaller households while women are having * Employed by a non-US affiliate of HSBC Securities (USA) Inc, and is
infrastructure not registered/ qualified pursuant to FINRA regulations.
fewer children and working more. All this impacts consumer spending. While COVID-
19 continues to cast a shadow over the region’s economy, it is also accelerating
some long-term trends that were already underway like more online shopping.
An academic view: We also interviewed Dr. Stuart Gietel-Basten, Professor of
Social Science and Public Policy at HKUST. He stated that it is possible for very low
fertility rates to become more common in the region. Further, he suggested that it
would be prudent to start planning for a time when families in Asia are not able or
willing to care for their older members, and to start thinking about new types of
insurance, care, and financial products to deal with this.
Opportunities: (1) We expect Chinese ‘empty-nesters’ to buy more premium
products – better quality at higher prices – on almost everything from food and
clothing to home furnishings. (2) More women in the workforce, which contributes to
Play interview with higher household income and how it is spent. (3) New forms of urbanisation are
Herald van der Linde, James Pomeroy unfolding too with growth higher in mid-tier cities, especially in ASEAN and India.
(4) Increased health awareness and rising risks from some diseases, particularly
and Barak Hurvitz Asiamoney Brokers Poll 2020
diabetes, mean more business for pharmaceutical companies, hospitals, and sellers
Voting opens 1st June – 21st August
of health equipment. (5) Asians are living and working longer, which allows for a If you value our service and insight, please vote
greater accumulation of wealth to finance an extended period of retirement.
Click here to vote
February 2021
Disclosures & Disclaimer Issuer of report: The Hongkong and Shanghai
Banking Corporation Limited
This report must be read with the disclosures and the analyst certifications in
James Pomeroy
Disclosures & Disclaimer: This report must be read with the disclosures and the analyst certifications in
the Disclosure appendix, and with the Disclaimer, which forms part of it. the Disclosure appendix, and with the Disclaimer, which forms part of it. View HSBC Global Research at:
https://www.research.hsbc.com
Global Demographics Europe’s demographics Asia Demographics LatAm demographics Economist and Global Coordinator
Mapping out a century of The edge of a precipice Large shifts are coming Four investment angles as of Demographics
changes soon the region ages
Read report › james.pomeroy@hsbc.com
Read report › Read report › Read report ›
Follow on LinkedIn
View insights
Watch on LinkedIn
New horizons for 2021: Our key themes from HSBC Global Research
Watch › Subscribe to theme
PUBLIC
HSBC Global Research • 9 key themes to guide your outlook www.research.hsbc.com | 9
Digital Finance
Watch list
® CreditTech – borrowing and
lending models developing
new routes to market,
effective and quick decision
We aim to understand and analyse how digital entrants and/or tech savvy business models making through with financial
services or ecommerce
across financial services disrupt, complement and/or enhance existing operations and key market ® Digital banks and insurers
participants. We also consider how such challenger models impact competitive positioning, – conducting all financial
services activity online
customer acquisition, customer retention, efficiency, market share, profitability, risk management
® Digital currency – Central
and underwriting as well as overall market dynamics Bank digital currencies and
cryptocurrencies that can
replicate key functions of
physical money
The money flower shows the different qualities of types of money Examples of technology applications
® Digital distribution and price
artificial intelligence
comparison – independent or
Central
bank-issued tied direct distribution and/or
Digital
price comparison platforms
Virtual currency along with machine learning, it can interpret and analyse data for risk ® Fintech infrastructure and
Poké coin assessment, investment and underwriting as well as improve services such software solution providers
Settlement as claims management, fraud detection – B2B service providers
or reserve supporting innovation and
accounts
development
blockchain
Bank deposits,
mobile money ® InsureTech – insurance
CBDC
Venmo, M-Pesa
(wholesale)
models that increase
Central Bank
accounts automation of underwriting,
CBDC allows performance of tasks faster and cheaper, track data flow sales, claims management
(retail) Private digital
internally, holds digital assets and settlement as well
tokens
Cash (wholesale) as attaching key services
to insurance to avoid
cloud big data
Widely
accessible Token-based commoditisation
Cryptocurrency ® InvestmentTech or
Bitcoin
WealthTech – Advisors and
increased capacity, agility collection, organisation, interpretation and investment platforms
Key: Type of product and flexibility for data analysis of data to support offers, product ® Payments – infrastructure,
Example CBDC = Central Bank Digital Currency storage design and underwriting e-wallet, payment acquiring,
network providers services
Source: BIS
PUBLIC
HSBC Global Research • 9 key themes to guide your outlook www.research.hsbc.com | 10
Digital Finance
Key insights
17 March 2021 Equities 18 September 2020 26 May 2020
Insurance
October 2020
Digital currencies Economics & Currencies
Global
By: Kailesh Mistry and Edwin Liu www.research.hsbc.com
Brazil Fintech & Instant Payments Equities
Financials
European Payments Equities
Software
S P O T L I G H T
What are they and why do they matter? Lessons for Brazil from India and the globe Brazil Post COVID-19 outlook supportive on all key drivers Europe
SPOTLIGHT
Insurance meets
As cash usage declines, new forms of digital money are To understand potential uptake and impact of PIX in Brazil, we Cash use declining faster in favour of digital payments should
Insurance meets healthcare
Antonin Baudry*
emerging studied India’s UPI and other global instant payment platforms offset weak consumption recovery and drive strong recovery Analyst
HSBC France, S.A.
Healthcare
antonin.baudry@hsbc.fr
We look at cryptocurrencies and Central Bank Digital Expect strong uptake in P2P, estimate banks could lose 1-5% M&A catalyst set to remain centre stage: European market +33 1 56 52 43 25
Currencies… of revenues but see risk to acquiring revenues as less imminent still fragmented and banks face major challenges
* Employed by a non-US affiliate of HSBC Securities (USA) Inc, and is
…and outline the impact they could have on the economy Select global experiences suggest cards will remain relevant Retain Buy on Worldline and Ingenico, Hold on Nexi and not registered/ qualified pursuant to FINRA regulations
and policy decisions From payer to payer, provider and and new business models will emerge; watch for early adopters Wirecard. Raise TPs for all on lower WACC, except Wirecard
risk influencer Post COVID-19 recovery should support payment companies: The Q1 2020
This report is a deep dive into Brazil’s instant payment platform, PIX, which is scheduled
As cash usage plummets in many parts of the world, the role played by new forms of results give us better visibility on the potential impact of the lockdowns on revenue in
to be launched in November (see PIX and Open Banking, 5 July 2020). To understand
digital currencies in the payments chain is only going to grow. But what sort of Insurers are increasingly evolving from the potential uptake for the new system and its impact on financial system participants, Q2 and the likely recovery during H2. We include extracts of recent reports by HSBC
currencies? Cryptocurrencies? Central Bank Digital Currencies (CBDCs)? James Pomeroy
Global Economist
simply writing and servicing health we look at India’s well-known UPI platform in detail. We also take a quick look at the fast Neha Agarwala, CFA economist James Pomeroy. In Lifting lockdowns (1 May) he highlights there is no
Stablecoins? Perhaps a mix of them all? These forms of money are all solely digital – Analyst, LatAm Financials & Fintech
guarantee of a V-shaped recovery for consumption in H2 2020 but a quicker shift
and are either issued via the central bank or privately.
HSBC Bank plc
policies to putting themselves at the payment systems in Australia, the UK, Sweden, Malaysia, Singapore and Mexico. HSBC Securities (USA) Inc.
james.pomeroy@hsbc.com neha.agarwala@us.hsbc.com from cash to contactless and digital payments (No cash, please, 29 April) could be a
+44 20 7991 6714 centre of health and wellness ecosystems PIX – riding on convenience and lower costs. We are optimistic on the uptake of PIX. +1 212 525 5418
strong catalyst for a revenue rebound in 2021, in our view.
Cryptocurrencies, in particular, have been getting a lot of attention recently because Paul Mackel With the benefit of learning from the experiences of other payment systems around the Carlos Gomez-Lopez, CFA
of Bitcoin’s spectacular price rise and the responses to it – with an increasing number Global Head of FX Research Head of EM and LatAm Financials P&L impact: We are more conservative than before for 2020. We now expect Q2 to be
globe, we note that PIX will be an inclusive platform and have more advanced features
of institutional investors showing an interest. Stablecoins, such as Diem, led by
The Hongkong and Shanghai Banking Corporation Limited This transition encompasses insurance, HSBC Securities (USA) Inc. hit more heavily and there remains uncertainty around the potential recovery in H2, due to
paulmackel@hsbc.com.hk than what UPI in India had at the beginning (pg11). The Brazilian regulator has been carlos.gomezlopez@us.hsbc.com
telemedicine, wellness and more likely consumption weakness. However, the temporary slowdown seen so far in 2020 due
Asset // Subcategory
Kailesh Mistry
Facebook, have also gathered much more attention in recent years. +852 2996 6565
creating awareness and swiftly adding partners, which should facilitate usage (electricity +1 212 525 5253
to COVID-19 creates a favourable basis of comparison for 2021. Combined with our
There is no doubt that the rise of cryptocurrencies and stablecoins has alerted
to enhance the competitiveness of bills, tax payments). Most importantly, Brazilian consumers have an incentive, at least for Ravi Singh*
Senior Banks Analyst expectation of a quicker switch from cash to digital payments, this would offset the
governments and policymakers, and is one reason why a number of central banks offerings, facilitate customer acquisition P2P (peer to peer) transactions, given the lower cost of PIX transactions. P2B (peer to HSBC Securities and Capital Markets (India) Private
potential impact of a macro slowdown on consumption in 2021, implying a strong
Equities | Insurance
Limited
business) could be trickier given the high card penetration rate and consumer’s significant
are drawing up plans for their own digital currencies. Sweden and China are leading and retention as well as influencing and ravi5.singh@hsbc.co.in recovery for the payments companies.
preference for credit cards with features like instalment payments. However, the +91 22 2268 1238
the way, but these central banks have other motives too, based on the rapid pricing risks experiences in Australia (pg19) and Sweden (pg21) is encouraging for P2B. Umang Shah* M&A catalyst to remain centre stage: We expect an acceleration of consolidation.
developments of digital payments in their economies. Analyst, Financials Nexi-SIA talks in Italy are gaining momentum and we update our view on a possible
Bank revenues likely be hit; acquirer revenues not imminently. While the experience HSBC Securities and Capital Markets (India) Private
This report will look at the differences between these forms of digital payments and Ping An has developed a comprehensive in India has been somewhat positive for banks (pg8), we expect a loss of fee income for Limited merger (potential accretive impact 10-15% on EPS 2020-21e on leverage 4x vs 3.5x
umang.shah@hsbc.co.in before). Ingenico’s acquisition by Worldline is ongoing. The disposal of Ingenico’s
Head of Financials Research, APAC
the potential economic and monetary impacts. health ecosystem for mainland China the banking sector in Brazil. As per our calculations, Brazilian banks earned about +91 22 2268 1243
point of sales business by Worldline would accelerate its capacity for further M&A.
At its heart this will be a battle over what best serves as a means of payment and/or mainly in-house, while AIA and Pru are BRL36bn in current account services (including TED and DOC; c.5% of total revenue) Rahil Shah*
Wirecard’s share price remains vulnerable to short-term sentiment with a lack of a
Analyst, Banks, Cement and Metals & Mining
store of value in the digital age. The current macro implications of both and BRL9bn in collection services, which include boleto. Our scenario analysis suggests
doing much the same across Asia but HSBC Securities and Capital Markets (India) Private solid and stable shareholder base. We analyse similarities with Iliad and Gemalto.
cryptocurrencies and stablecoins are limited – but this may change depending on that the large listed banks could lose at least 3-5% of their earnings in the short term Limited
through partnerships or JVs (pg15). For the payment acquirers, we expect a meaningful impact if and when P2B takes
rahil.shah@hsbc.co.in Ratings: Since the 19 March lows, share prices have rebounded by c60% on
how the underlying technology develops and the number of use cases grows. +91 22 6628 3719
average, outperforming the Eurostoxx 50’s 13% (except Wirecard -7%). We favour
and Global Coordinator of Digital
Tracking how both of these factors develop will be important in the coming years. off; in such a scenario, companies in the micro-merchant segment, like PagSeguro,
appear more at risk (pg16). The experiences so far in India and Sweden indicate that fast exposure to online payment, geographical spread in strong economies, capacity to
* Employed by a non-US affiliate of HSBC Securities (USA) Inc, and is
Central bank digital currencies will likely have a greater economic impact. But the payment platforms have mostly displaced cash, not so much cards. not registered/ qualified pursuant to FINRA regulations capture the consumption recovery and the shift from cash to electronic payment
leading pilots in China and Sweden are converging on a similar design in a way that thanks to high exposure to transaction volume and potential for M&A or accretive
Expect new opportunities to be created but mindful of risks. Instant is not the end-
may mean that, while payment networks could be more efficient and secure, most of disposals. We remain Buy on Worldline-Ingenico (preferred stocks) and Hold on Nexi
game here. Indeed, instant or fast payment systems should allow the development of
us may not notice a difference day to day. How these pilots develop and how other and Wirecard. We raise our TPs for all on lower WACCs, except Wirecard.
Finance
value-added services, stimulating competition and innovation (pg17). As in India, Australia
central banks react will also be key to follow.
and Singapore, we expect new business models to emerge. And the early-movers will Rating and target price summary
While there has been much excitement over cryptocurrencies and CBDCs, it is just likely be in advantageous positions. We could also see some increased participation from Current ______ TP______ __ Rating__ Upside/ Market cap _____ EV/EBITDA ______ ________ PE__________
as important to remember the implications of getting many of the millions of
Asiamoney Global RMB Poll 2021 telecom and e-commerce companies. However, we believe customer awareness and
2020 GEMs Forum – Going Virtual Company Ticker Currency price Old New downside (EURm) 2020e 2021e 2020e 2021e
Ingenico ING FP EUR 119.5 132 141 Buy 18% 7,457 16.6 13.9 25.7 21.5
unbanked people across the world access to more traditional digital payments, which
Voting opens 22nd Feb – 02nd April 2021
trust will be the key to adoption (pg18). Although merchants have significant cost 6th – 30th October 2020 Nexi * NEXI IT EUR 14.8 12.5 14.5 Hold -2% 9,291 19.4 16.6 35.1 29.4
If you value our service and insight, please vote
Wirecard WDI GR EUR 83.2 105 95 Hold 14% 10,284 9.6 6.4 15.5 11.2
is likely to have a far greater near-term economic impact. incentives to use real-time payment systems, customers do not care much how they
Click here to vote Register now Worldline ** WLN FP EUR 63.0 70 75 Buy 19% 11,494 19.3 15.6 31.6 25.0
make a transaction as long as it adds convenience, is economical and safe to use. Source: HSBC estimates. Priced as of close at 21 May 2020 * Includes ISP pro forma 2020e ** Includes Ingenico pro forma 2020e
kailesh.mistry@hsbc.com.hk
October 2020
Issuer of report: HSBC Bank plc Disclosures & Disclaimer Issuer of report: HSBC Securities (USA) Inc Disclosures & Disclaimer Issuer of report: HSBC France, S.A.
Disclosures & Disclaimer
This report must be read with the disclosures and the analyst certifications in This report must be read with the disclosures and the analyst certifications in This report must be read with the disclosures and the analyst certifications in
View HSBC Global Research at: Disclosures & Disclaimer: This report must be read with the disclosures and the analyst certifications in View HSBC Global Research at: View HSBC Global Research at:
the Disclosure appendix, and with the Disclaimer, which forms part of it. the Disclosure appendix, and with the Disclaimer, which forms part of it. the Disclosure appendix, and with the Disclaimer, which forms part of it.
https://www.research.hsbc.com the Disclosure appendix, and with the Disclaimer, which forms part of it. https://www.research.hsbc.com https://www.research.hsbc.com
Digital currencies Spotlight: Insurance Brazil Fintech & Instant European Payments
What are they and why do meets Healthcare Payments Post COVID-19 outlook Follow on LinkedIn
they matter? From payer to payer, Lessons for Brazil from supportive on all key
provider and risk influencer India and the globe drivers
Read report ›
Read report › Read report › Read report ›
View insights
Watch on LinkedIn
New horizons for 2021: Our key themes from HSBC Global Research Subscribe to theme
Watch ›
PUBLICHSBC Global Research • 9 key themes to guide your outlook www.research.hsbc.com | 11
Disruptive Technology
Watch list
® Forecast AI chip
demand CAGR of 28%
out to 2027 – key for
Asia manufacturers
Technology is disrupting business models around the world, helping companies to make huge leaps ® Cloud’ is still growing,
forward. We help investors understand what to watch out for and how to view tech changes and with some 70% of
software yet to migrate
their impact using our HSBC Disruption Framework
® IoT connected devices
to double by 2025,
supporting over USD1trn
HSBC Disruption Framework of related revenue
Disruptive technology can be considered as a ‘super dot joiner’; it disruptive new business models through HSBC Disruption Framework ® 60% of people to have
connects numerous themes, sectors and assets classes. artificial intelligence and automation. In our view these are likely to mobile internet by
be long-lasting changes in behaviour which could lead to the next 2025, up from ca.49%
2020 was likely to be a tipping point in the adoption of digitalisation. phase of technology-led growth around remote access. Through now
We can see this in the way people are behaving as employees our disruption framework, we examine an array of technologies and ® Data growth, with 5G
(working from home), as students (online education), as consumers related infrastructure that we think are key to these shifts, and hence likely to make up 20% of
(e-commerce), when seeking entertainment (virtual events, e-sports), well-placed to drive long-term outperformance in an already growing mobile connections by
and when needing medical advice (e-medicine). We also see this in technology sector – these include connectivity, automation, experiential, 2025
business, especially with asset-heavy industries seeking efficiencies and and digital health. ® Digital health/
telemedicine worth up
to USD250bn annually
Expectations Expectation > reality
begin in the US alone by 2025;
Expectations see a need for 60,000
expectation vs. reality
Gradient of estimated
meet reality medical robots globally
Expectations Backlash Real
by 2025, 4x that in 2018
exceed reality window application New normal
Expectation = reality ® Hardware/software
Early Hype market for drone-related
disruption mania
businesses to reach
USD120bn by 2030
Expectations fall as Expectations
experiments deemed ‘failure’ catch reality Expectation < reality
Source: HSBC Source: The Edge of Disruption -- Finding
engines of growth for tomorrow
PUBLICHSBC Global Research • 9 key themes to guide your outlook www.research.hsbc.com | 12
Disruptive Technology
Key insights
Equities
Thematic
26 January 2021
Thematic Global
Global Global
THIS CONTENT MAY NOT BE DISTRIBUTED TO MAINLAND CHINA May 2019
By: Davey Jose, Sean McLoughlin, and Michael Hagmann www.research.hsbc.com
Beyond Reality
November 2020 By: Davey Jose, Sean McLoughlin, Ashim Paun, Sriharsha Pappu, February 2021
By: Davey Jose, David Phillips and Edward Stanford www.research.hsbc.com
Thematic Parash Jain and Amy Tyler www.research.hsbc.com
Global
S P O T L I G H T
S P O T L I G H T
Is the race to VR in 2020s about to begin?
SpotliGHt
SPOTLIGHT SPOTLIGHT
The Edge of Disruption
The pandemic is accelerating the use of virtual reality
The second frontier Powering the data
The Edge of Disruption
The second frontier
Davey Jose*
Thematic Analyst, Disruptive Technologies
revolution
Competition is needed to take VR to the next level, in our view HSBC Bank plc
davey.jose@hsbcib.com
+44 20 7991 1489
Could Apple help the market in the 2020s?
Finding engines of growth for tomorrow Frank Lee*
Head of Technology Research, Asia
Towards low carbon shipping
The Hongkong and Shanghai Banking Corporation Limited
With 2020 seeing accelerated digital
Is VR on the edge of disruption…? frank.lee@hsbc.com.hk
+852 2996 6916 Shipping represents 13% of global The strains facing global electricity
Last year, we published our thematic report The Edge of Disruption – finding engines
adoption, we identify four key of growth for tomorrow (22 November 2020). In that report, we broke down disruption
Nicolas Cote-Colisson* transport CO2 emissions and has
technology themes for further growth
Senior Analyst, TMT
lagged other transport sectors in the Exponential growth of data usage
into four key themes: connectivity, automation, digital health and experiential. In this HSBC Bank plc
short update, we give you our latest thoughts on virtual reality and augmented reality,
nicolas.cote-colisson@hsbcib.com
drive to decarbonise could drive an acceleration in global
+44 20 7991 6826
Our analysts across Global Equity which we believe sits within our experiential theme in the ‘real applications’ stage in Amy Tyler*
power consumption by 2030 –
Research look at the potential our HSBC Disruption Framework (see Chart 3). Analyst
HSBC Bank plc With global sea freight demand investors and industry participants
impact on 20 sectors and their ESG If VR is to climb beyond the ‘real applications’ stage of our framework and move into amy.frances.tyler@hsbc.com
potentially tripling by 2050, policy should be alert to potential risks
implications… the ‘new normal’ in the 2020s, then the space needs to become more competitive, in and technological innovation are key
* Employed by a non-US affiliate of HSBC Securities (USA) Inc, and is
our view. This would include more hardware companies facing more price competition Efficiency gains have offset higher
not registered/ qualified pursuant to FINRA regulations to hitting emissions targets
…and distil our thematic views to and more VR content.
data consumption, but we think
Asset // Subcategory
Asset // Subcategory
around 30 investible ideas that are In a previous update, Beyond Reality: The show must go on – can VR content make The solutions will include greater take off in VR, AV or blockchain may
exposed to the likely disruption money today? (20 July 2020), we focused on the development of digital content, such use of batteries and LNG/LPG, and, change this; electrification of transport
as concerts, conferences, education, games, etc, in VR. In this update, we outline why
Thematic | Global
Thematic | Global
longer term, ammonia and green may further strain power systems
we think recent reports of Apple entering VR could be a shot in the arm for the VR
landscape and public visibility. hydrogen could play important roles
Davey Jose
We flag 26 stocks with exposure to
Chart 1: Mobile is competitive … – Chart 2: … VR is not competitive yet the theme, highlighting 4 Buy-rated
mobile phone market shares, 2Q20 – VR headset market share, 2Q20 ideas
Huawei Others
Facebook
Others 20% 16%
39%
28%
DPVR
9%
Samsung
Thematic Analyst and Global
Pico
Vivo 19%
9%
9%
Xiaomi HTC
Apple 5% Sony
10%
Play video 14% 22% Play the video
Play interview with
Source: IDC Source: IDC
Sean McLoughlin and Davey Jose
Coordinator of Disruptive
November 2020
February 2021
Issuer of report: HSBC Bank plc
Technology
Disclosures & Disclaimer: This report must be read with the disclosures and the analyst certifications in Disclosures & Disclaimer Disclosures & Disclaimer: This report must be read with the disclosures and the analyst certifications in
the Disclosure appendix, and with the Disclaimer, which forms part of it. This report must be read with the disclosures and the analyst certifications in the Disclosure appendix, and with the Disclaimer, which forms part of it. Disclosures & Disclaimer: This report must be read with the disclosures and the analyst certifications in
View HSBC Global Research at:
the Disclosure appendix, and with the Disclaimer, which forms part of it. https://www.research.hsbc.com the Disclosure appendix, and with the Disclaimer, which forms part of it.
The Edge of Disruption Beyond Reality The second frontier Powering the data Age of Cybersecurity davey.jose@hsbcib.com
Finding growth engines Is the race to VR in 2020s Towards low carbon revolution Spend to defend
of tomorrow about to begin? shipping The strains facing global
electricity Read report ›
Read report › Read report › Read report › Follow on LinkedIn
Read report ›
View insights
Watch on LinkedIn
Live Insights: Disruptive Technologies, 28th April 2021 Subscribe to theme
Attend ›
PUBLICHSBC Global Research • 9 key themes to guide your outlook www.research.hsbc.com | 13
Energy Transition
Watch list
® Clean power
generation: Coal
and natural gas to be
phased out by 2035 in
We see a mix of renewable energy sources, efficiency gains, design changes, new storage solutions developed markets, and
and continued progress on innovation, adoption, scale and costs as central to the energy transition mostly by 2050 globally
® Cleaner transport:
case for moving away from carbon intensive energy sources Diesel and gasoline
make way for batteries
Snapshot: global Green House Gas emissions flows (2017) and fuel cells in road
transport by 2040,
Source of emissions Human activities responsible Greenhouse gases (GHGs) Sinks
with global regulation
limiting shipping and
aviation emissions
Electricity: 26.2%
® Green buildings:
Retrofitting in existing
Industry: 11.8% buildings and green
Coal: 30.4%
Iron & steel 3.1% new builds increase
Chemical & petrochem 0.1% 18.7%
Transport: 15.9 Cement production 2.2% 24% CO2 to land energy efficiency, as oil
Other industry 6.4%
and gas are replaced by
Oil: 24.4% Fugitive & other: 9.5% Road 11.9% Cars 6.2%
17.8% electricity and hydrogen
Carbon dioxide (CO2): 23% CO2 to oceans
Aviation 1.9% Vans 2.1% 74.0% as energy sources
Shipping 1.6% Buses 0.7%
Gas: 14.4% Buildings: 5.8% Pipeline transport
Rail & other
0.3%
0.2%
Trucks 2.9% 41.3% ® Low-carbon Industry:
53% CO2 to atmosphere
Fugitive 5.6%
~50
GTCO2e
A disparate sector
Solid waste disposal: 1.7%
Wastewater handling: 1.9% Own use & other 3.9% requiring diverse
Waste: 4.1%
Waste incineration & other: 0.4% Residential buildings 4.1% 0.9% solutions, such as
Other agri emissions: 2.6% Commercial buildings 1.7% 5% CH4 to land
Methane (CH4): 16.2% materials efficiency and
Agriculture: 11.4 Enteric fermentation: 4.8%
Rice cultivation: 1.2%
16.8% 95% CH4 to atmosphere recycling, electrification,
Manure management: 2.7% 1.6%
Land use, change & forestry: 6.2%
Nitrous oxide (N2O): 27% N2O to pyrolysis
carbon capture and
Industrial processes: 9.1%
Crop & grassland: 1.4% 6.2% in stratosphere hydrogen reduce
Forest: 2.1% F-gases: 7.2%
Burning biomass: 2.8% 3.0% 73% N2O & 100% of emissions from metals
F-gases to atmosphere & mining, chemicals,
Calcination & lime production: 3.4%
Metals & chemicals: 2.2% cement, oil & gas and
Other industrial processes: 3.4% Fluorinated gases
Source: HSBC, IEA, EDGAR, Global Carbon Project. Please see our report ‘Future Frontiers -- The pathway towards net-zero’ for more details
PUBLICHSBC Global Research • 9 key themes to guide your outlook www.research.hsbc.com | 14
Energy Transition
Key insights
ESG & Climate Change Equities Equities
Global Global Energy Equipment & Services
By: Ashim Paun, Sriharsha Pappu, Wai-Shin Chan, Tarek Soliman and March 2021 March 2021 January 2021
the Global Research team www.research.hsbc.com By: Tarek Soliman www.research.hsbc.com By: Tarek Soliman and Sean McLoughlin www.research.hsbc.com
S P O T L I G H T
S P O T L I G H T
SPOTLIGHT SPOTLIGHT
Future Frontiers Carbon Capture & Hydrogen electrolysers
Hydrogen electrolysers
Future Frontiers
Carbon Capture & Sequestration
The pathway towards net-zero Sequestration The rock star of clean energy or just a
case of FOMO?
To achieve the global warming targets
Back in the debate, but no silver bullet
agreed in the Paris Agreement… Green hydrogen is forcing its way
Carbon capture has re-emerged as a up the energy transition agenda;
…the world needs to cut emissions electrolysers occupy a crucial part of
key decarbonisation option, but does
rapidly the supply chain
not represent a ‘silver bullet’ or a
substitute for deep emissions cuts
Our global decarbonisation scenario We see unparalleled growth prospects
looks at how cleaner power, transport, of ~200x to 2030, backed by rising
After a decade of losing ground to
buildings and industry can reduce the political and corporate commitment to
wind and solar, the 2020s are likely
emissions gap to net-zero by 81% green hydrogen
‘make or break’ for the technology to
Sriharsha Pappu
Asset // Subcategory
Asset // Subcategory
Asset // Subcategory
by 2050
play a key role in reaching global net
We initiate on ITM Power (Hold, TP
zero emissions
Equities | Energy Equipment & Services
ESG & Climate Change | Global
550p) and NEL (Hold, TP NOK33),
Equities | Global
Corporate appetite to invest in CCS both set to be key players but where
is growing but remains sensitive to valuations have risen sharply. We
policy support. In this report we list maintain a Buy rating on Siemens
Energy (new TP EUR41) which has an
Head of Chemicals Research and
51 companies exposed to the carbon
capture value chain emerging electrolyser business
Global Coordinator of Energy
Transition
Play interview with Play video with Play video with
Ashim Paun Tarek Soliman Tarek Soliman
January 2021
sriharsha.pappu@hsbc.com
March 2021
March 2021
Disclosures & Disclaimer: This report must be read with the disclosures and the analyst certifications in Disclosures & Disclaimer: This report must be read with the disclosures and the analyst certifications in Disclosures & Disclaimer: This report must be read with the disclosures and the analyst certifications in
the Disclosure appendix, and with the Disclaimer, which forms part of it. the Disclosure appendix, and with the Disclaimer, which forms part of it. the Disclosure appendix, and with the Disclaimer, which forms part of it.
Future Frontiers Spotlight: Carbon Spotlight: Hydrogen Energy Transition
The pathway towards net- Capture & Sequestration electrolysers Our best ideas Follow on LinkedIn
zero Back in the debate, but no The rock star of clean
silver bullet energy or just a case of Read report ›
Read report › FOMO?
Read report ›
Read report › View insights
Watch on LinkedIn
New horizons for 2021: Our key themes from HSBC Global Research Subscribe to theme
Watch ›
PUBLICHSBC Global Research • 9 key themes to guide your outlook www.research.hsbc.com | 15
Future Cities
Watch list
® Today, roughly 4.2bn
people live in cities
across the world, and
this is set to rise to 5.2bn
The pandemic has changed the way we think about urbanisation, raising challenges in well-being, by 2030 and 6.7bn by
mobility, infrastructure, housing and work practices all of which require careful consideration, 2050, says the UN
® With cities responsible for
planning and embodiment in our future cities between 40% to 70% of
Green House Gas (GHG)
emissions, we expect
Global urban population How cities can be smarter cities to prioritise air
pollution from transport
6.7bn congestion as air pollution
is also responsible for
5.2bn Faster mobile Smarter buildings Predictive More working Prefab ‘flatpack’
over 3m deaths a year
globally
and broadband using less energy policing from home housing
® Green, Social and
networks
Sustainability Bonds
are increasingly being
issued to fund green and
social projects in urban
areas. In 2020, green,
2030 2050 Bigger public Faster emergency Online Paying fines or More cycle lanes social and sustainability
transport networks response education taxes via app bond issuance reached
USD 400bn, up 24% vs
Source: UN, HSBC
2019, and is expected
to rise to USD650bn in
2021, a 60%+ increase on
Ideas key to these long-term shifts
issuance in 2020
fewer cars
green bonds
congestion public service
fewer
journeys
® Although economies
quality of life
women
smart cities
crime and
autonomous vehicles
are expected to open up
climate change and pollution
safety
credit risk
throughout 2021, will
people travel to cities for
housing social and sustainability bond private sector bond work and entertainment?
PUBLICHSBC Global Research • 9 key themes to guide your outlook www.research.hsbc.com | 16
Future Cities
Key insights
24 February 2021
Economics & ESG
Global
October 2019
Cities and inflation
By: James Pomeroy and Ashim Paun www.research.hsbc.com Economics
Global
Why urban migration is worth watching Global
Future cities
The pandemic has made urban living less popular…
…which is weighing on rental prices…
…that may not recover fully until cities regain their allure
Cut congestion, lift growth
Urbanisation trends may not be something that many investors spend too much time
Urban congestion creates huge costs worrying about. They are typically seen as slow-moving, longer-term issues that don’t
affect asset prices or the economy in the short term.
for the global economy
But, as a result of the pandemic, that may have changed. The nature of the pandemic
This will only rise without investment has at least temporarily made living in large cities less attractive, particularly in
apartments with limited access to outside space. In the developed world, where remote
in public transport and new city
working jobs are more common, we can see that fewer people are moving to cities (and
layouts young people are staying with parents more), meaning that while house prices are James Pomeroy
Economist
surging, rental demand in cities remains soft. This is weighing on rental prices, a key HSBC Bank plc
We outline what could and should be component of inflation. james.pomeroy@hsbc.com
done across the world +44 20 7991 6714
While timely data aren’t available everywhere, information from private apartment listings Ryan Wang
providers are showing this trend in big cities. In the US, according to Apartment List, US Economist
HSBC Securities (USA) Inc.
Stephen Bramley-Jackson
three of the largest metropolitan areas – Los Angeles, New York, and Chicago – have Ryan.Wang@us.hsbc.com
seen y-o-y declines ranging from -4% to -9% recently. Rental demand outside big cities +1 212 525 3181
has held up, but not enough to keep the national indices up: average rental prices on
Apartment List were down 1.2% y-o-y in January.
In the UK, according to HomeLet, rental prices in Greater London were down 3.9% y-o-y
in January, despite rising 5.8% y-o-y elsewhere. In Australia, CoreLogic data cited by the
RBA shows that rental inflation for apartments is negative in Melbourne and Sydney,
while rental vacancy rates have spiked.
While prospective renters are being offered lower prices, CPI data on rents more closely
reflect the prices paid by all tenants, including those that have not moved. In most metro
areas in the US where we have data, the CPI data on rents have cooled off but have
stayed in positive y-o-y territory. A key question is how long any downward pressure on
Global Head of Real Estate
Research and Global Coordinator of
rental inflation will persist, and this will likely depend on how quickly the appetite to move
into major cities revives. This could matter a lot for inflation developments in the coming
years, particularly in the US where rents account for 30% of the CPI basket.
As a result, the movement of people in and out of cities will be a key indicator to
Play interview with follow. If the end of the pandemic is met with a robust economic recovery and a
Future Cities
James Pomeroy return to urban living, particularly for young renters, then we could see rental demand
and prices pick back up.
But, if remote work holds these flows back as people don’t need to move to cities to
be close to offices, then lower rental prices in large cities may weigh on headline
inflation rates for some time.
Disclosures & Disclaimer: This report must be read with the disclosures and the analyst certifications in
the Disclosure appendix, and with the Disclaimer, which forms part of it.
Disclosures & Disclaimer
This report must be read with the disclosures and the analyst certifications in
the Disclosure appendix, and with the Disclaimer, which forms part of it.
Issuer of report: HSBC Bank plc
View HSBC Global Research at:
https://www.research.hsbc.com
stephen.bramley-jackson@hsbc.com
Future cities Cities and the pandemic Future Cities Future Cities
Cut congestion, lift growth What is the impact from The changing shape of A different type of Follow on LinkedIn
re-opening? urbanisation urbanisation – ways to play
Read report › our theme
Read report › Read report ›
Read report ›
View insights
Watch on LinkedIn
New horizons for 2021: Our key themes from HSBC Global Research Subscribe to theme
Watch ›
PUBLICHSBC Global Research • 9 key themes to guide your outlook www.research.hsbc.com | 17
Future Consumer
Watch list
® The global beauty
market has seen huge
demand shifts during
2020 as parts of the
The future of consumption will be driven by Asian consumers and women in terms of both industry have proved
spending volumes and influence on other consumer clusters resilient but others have
suffered, most notably
make-up. Skincare,
fragrance, makeup
As such, we focus consumer research on the “4Cs”: Population (mn) 40-64 years with household income >USD50,000 and hair care sectors
are collectively worth
Chinese
120
China USD320bn
100
US ® Fragmented, female
80 and retail-heavy
dominating many subsectors 60 jewelry segment
40 likely to outperform the
Japan luxury sector, outside
Channels
20
UK
a handful of brands we
0
2010 2015 2020 2025 2030 2035 2040 2045 are less optimistic about
the watch trade
Source: Global Demographics, HSBC
what place for brick and mortar versus online surge ® The European
Stickiness of online behaviour post vaccine (Brazil) Consumer Staples
and Beverages
Consolidation
0% 20% 40% 60% 80% 100% sector had a resilient
2020 given massive
Expect to buy
post vaccine dislocation caused by
COVID-induced M&A and scale advantages COVID-19. Not only did
During 2020 the covered companies
generally do a good job
Conscience
Pre-COVID-19
at coping with swings
in demand but the big
brands came into their
More than Once a 2-3 times Once a Once in 2-4 Once a own after a number of
buy less, buy better, health concerns, buy purpose not once a week week a month month months year years of pressure from
just products, circularity and second hand
Source: HSBC, Toluna; number of respondents: 1,671 smaller-start-ups
PUBLICHSBC Global Research • 9 key themes to guide your outlook www.research.hsbc.com | 18
Future Consumer
Key insights
Equities Equities Equities Equities
Consumer Future Consumer Consumer Global Luxury Goods
March 2021 December 2020 February 2021
January 2021
By: Ravi Jain and Felipe Cassimiro www.research.hsbc.com By: Jeremy Fialko, Erwan Rambourg, Karen Choi, Antoine Belge and Robert Price www.research.hsbc.com By: Erwan Rambourg and Anne-Laure Bismuth www.research.hsbc.com
By: Jeremy Fialko and Robert Price www.research.hsbc.com
S P O T L I G H T
SPOTLIGHT
European Staples in 2021 Brazil: Anatomy of the Global Beauty Time to shine
Global Beauty
Time to shine
Brazil: Anatomy of the digital consumer
European Staples in 2021
Ready for the next stage digital consumer Onwards and upwards Bullish outlook for luxury jewelry,
watches more mixed
Dislocation caused by coronavirus
Despite the extraordinary swings of Prepare for a new normal post vaccine
2020 most staples demonstrated the has raised important questions over Fragmented, female and retail-heavy
resilience of their business models the beauty industry’s direction jewelry segment likely to outperform
In our third proprietary Brazil survey,
we focus on the rise of the digital the luxury sector. Outside of Rolex
Yet much of the sector’s H1 Our proprietary survey of 4,700 and a handful of other brands, we are
consumer and the lasting impact of
outperformance was given back in consumers seeks answers – they less optimistic about the watch trade
COVID-19 on consumer behavior
H2 and valuations have returned are reassuring with appetite for the
towards historical averages category undimmed Tiffany to shine at LVMH (Buy)
We offer insights into brand
preferences across e-commerce, though not a transformational deal;
The sector offers several attractive Raise our L’Oréal target price to Richemont (Buy) more of a pure play
mobile wallets, apparel, footwear,
Erwan Rambourg
Asset // Subcategory
Asset // Subcategory
Asset // Subcategory
Asset // Subcategory
opportunities. We remain Buy on EUR305 from EUR246, rated Hold, on jewelry
sporting goods, food retail, restaurants,
Henkel, Nestlé, Reckitt, Diageo and change three more target prices.
cosmetics, and travel/leisure
Equities | Consumer
Upgrade Henkel to Buy from Hold.
Equities | Consumer
Equities | Global Luxury Goods
and Danone
Equities | Future Consumer
Retain Hold rating on Swatch despite
LVMH, Amorepacific and LG H&H valuation gap
Weekends post vaccine will likely
remain Buy
include restaurants, theaters, and malls,
but there are enough datapoints in the
Global Head of Consumer and
survey to reinforce stickiness in online
purchase frequency
Retail Research and Global
Coordinator of Future Consumer
Play video with Play video with Play video with
Ravi Jain Jeremy Fialko Erwan Rambourg
December 2020
erwanrambourg@us.hsbc.com
January 2021
February 2021
March 2021
Disclosures & Disclaimer: This report must be read with the disclosures and the analyst certifications in Disclosures & Disclaimer: This report must be read with the disclosures and the analyst certifications in Disclosures & Disclaimer: This report must be read with the disclosures and the analyst certifications in Disclosures & Disclaimer: This report must be read with the disclosures and the analyst certifications in
the Disclosure appendix, and with the Disclaimer, which forms part of it. the Disclosure appendix, and with the Disclaimer, which forms part of it. the Disclosure appendix, and with the Disclaimer, which forms part of it. the Disclosure appendix, and with the Disclaimer, which forms part of it.
European Staples in 2021 Brazil: anatomy of the Global Beauty Time to shine
Ready for the next stage digital consumer Onwards and upwards Bullish outlook for luxury Follow on LinkedIn
Prepare for a new normal jewelry, watches more
Read report › post vaccine Read report › mixed
Read report › Read report ›
View insights
Watch on LinkedIn
New horizons for 2021: Our key themes from HSBC Global Research Subscribe to theme
Watch ›
PUBLICYou can also read
