Senior Credit Analyst, Lucror Analytics

Leonard Law, CFA

Senior Credit Analyst

High Yield Experts

Lucror Analytics

Lucror Analytics is a leading credit and ESG research specialist and a provider of technology solutions for differentiated fixed income strategies. Our roots are in bottom-up fundamental credit analysis with a specialization in high yield corporate credits from Europe, Asia and Latin America. We are one of few research specialists integrating ESG considerations with fundamental credit research through a dedicated ESG platform. Our ESG assessment covers five key criteria: Disclosure, E,S, & G Pillars, Controversies, ESG Impact on Credit and ESG Momentum.

Recognizing the importance and value-add of Factor Investing in fixed income, Lucror developed the Smart Quant Navigator (SQN), an intuitive platform that helps clients devise and implement factor-based strategies ranging from pure quant to active fundamental, with integrated ESG.

Our company has been at the forefront of developments in the fixed income markets, identifying opportunities and consistently delivering new products and value-adding solutions to clients. Lucror has close relationships with the largest and most reputable asset managers, family offices, hedge funds, investment and wealth managers globally.

Credit

In this month's “In-Focus”, we update our study of agency ratings for Asian issuers, analysing ratings transitions for all issuers in the Lucror Asia HY index between January 2014 and the present. The Asia Monthly focuses on providing updates on recent events, information on new issues and spread movements, as well as summarising our top picks and discussing specific areas of interest in the “In-Focus” section. The Asia Monthly is intended to broaden investors' understanding of the Asian USD high-yield market.

  In this month's “In-Focus”, we update our study of agency ratings for Asian issuers, analysing ratings transitions for all issuers in the Lucror Asia HY index between January 2014 and the present.   The Asia Monthly focuses on providing updates on recent events, information on new issues and spread movements, as well as summarising our top picks and discussing specific areas of interest in the “In-Focus” section. The Asia Monthly is intended to broaden investors' understanding of the Asian USD high-yield market.  

Asia HY Monthly - Asian HY Ratings Transition Study - Lucror Analytics

China Specialist, Auto and Industrial Specialist

Victoria Li

Equity Bottom-Up

It is disappointing that Geely has given up on its Volvo merger plan, which would limit the share performance upside in short term. In the long term, Geely's valuation re-rating is still possible depending on how successful it would be in NEV market. We believe recent market correction has priced in the negative impact. Looking forward, what the investors could expect in 2021E is 1) its A-share IPO, although it has higher uncertainty with a longer waiting time - as the company might have to update its financial data (such as 2020 annual results), before launching it.2) Lynk Zero, Geely's first EV from SEA platform, might come ahead of schedule. Recent market reports says this new car would be officially launched in March-April and start delivery at end-Sep 2021.

It is disappointing that Geely has given up on its Volvo merger plan, which would limit the share performance upside in short term. In the long term, Geely's valuation re-rating is still possible depending on how successful it would be in NEV market. We believe recent market correction has priced in the negative impact. Looking forward, what the investors could expect in 2021E is 1) its A-share IPO, although it has higher uncertainty with a longer waiting time - as the company might have to update its financial data (such as 2020 annual results), before launching it.2) Lynk Zero, Geely's first EV from SEA platform, might come ahead of schedule. Recent market reports says this new car would be officially launched in March-April and start delivery at end-Sep 2021.

The Asia HY Trade Book for the month of February includes a summary of our recommendations, as well as our high-conviction ideas. The report also features relative-value charts and lists of the bonds in the Lucror Asia HY index.

  The Asia HY Trade Book for the month of February includes a summary of our recommendations, as well as our high-conviction ideas. The report also features relative-value charts and lists of the bonds in the Lucror Asia HY index. 

Asia HY Trade Book - February 2021 - Lucror Analytics

Global Emerging Market Equities, Propitious Research

Wium Malan, CFA

Global Emerging Market Equities

Since my last detailed look at <a href="https://www.smartkarma.com/entities/baidu-inc" target="_blank" data-smartkarma-citation="entities:179:1" rel="noopener">Baidu (BIDU US)</a>’s valuation back in September last year (<a href="https://www.smartkarma.com/insights/baidu-strategies-for-operating-in-an-industry-in-decline" target="_blank" data-smartkarma-citation="insights:43393" rel="noopener">Baidu: Strategies for Operating in an Industry in Decline</a>) Baidu’s share price has witnessed a meteoric rise of 170%, re-rating from 6.2x to 16.9x NTM EV/EBITDA.This has been driven by several catalysts, such as M&amp;A into live streaming, increased share buybacks, the continued prospect of a Hong Kong listing, and improved reported earnings, but most-of-all, by their announcement that they plan to start an intelligent electric vehicle company in strategic partnership with <a href="https://www.smartkarma.com/entities/geely-automobile-holdings-ltd" target="_blank" data-smartkarma-citation="entities:127:1" rel="noopener">Geely Auto (175 HK)</a>. Following their recent 4Q20 results, management also went to great lengths to highlight the revenue growth acceleration in their “Non-marketing Baidu Core” sub-segment, emphasising the shift away from their traditional Core Search Advertising, or mobile ecosystem, to diversify revenue streams. In this insight, I take a closer look at this sub-segment and analyse what the current market value implies for those operations, as well as their future “intelligent electric vehicle” venture.

Since my last detailed look at Baidu (BIDU US)’s valuation back in September last year (Baidu: Strategies for Operating in an Industry in Decline) Baidu’s share price has witnessed a meteoric rise of 170%, re-rating from 6.2x to 16.9x NTM EV/EBITDA.This has been driven by several catalysts, such as M&amp;A into live streaming, increased share buybacks, the continued prospect of a Hong Kong listing, and improved reported earnings, but most-of-all, by their announcement that they plan to start an intelligent electric vehicle company in strategic partnership with Geely Auto (175 HK). Following their recent 4Q20 results, management also went to great lengths to highlight the revenue growth acceleration in their “Non-marketing Baidu Core” sub-segment, emphasising the shift away from their traditional Core Search Advertising, or mobile ecosystem, to diversify revenue streams. In this insight, I take a closer look at this sub-segment and analyse what the current market value implies for those operations, as well as their future “intelligent electric vehicle” venture.

Baidu: A Closer Look at Non-Marketing Baidu Core. What Are We Paying for EV?

Semiconductors, Memory and SSDs Specialist, Objective Analysis

Jim Handy

Semiconductors, Memory and SSDs Specialist

Objective Analysis

Objective Analysis offers third-party independent market research and data for the semiconductor industry and investors in the semiconductor industry.

Semiconductors, Memory and SSDs

Thematic (Sector/Industry)

After Japan's earthquake automobile makers had a lot to worry about, since they were already faced with critical semiconductor shortages.  Now unusually bad weather has hit much of the US, and has stopped chip production in three important fabs in Austin, Texas.  This Insight explores the winners and losers in this series of events.

After Japan's earthquake automobile makers had a lot to worry about, since they were already faced with critical semiconductor shortages.  Now unusually bad weather has hit much of the US, and has stopped chip production in three important fabs in Austin, Texas.  This Insight explores the winners and losers in this series of events.

Texas Weather Deals Second Blow to Automotive Chip Supply Chain

Hong Kong

Geely Automobile Holdings Limited operates as a passenger vehicles manufacturing company. The Company provides passenger vehicles development, manufacturing, sales, and other services. Geely Automobile Holdings also exports passenger vehicles.

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Geely Auto (175 HK)

Asia HY Monthly - Asian HY Ratings Transition Study - Lucror Analytics

In this month's “In-Focus”, we update our study of agency ratings for Asian issuers, analysing ratings transitions for all issuers in the Lucror...

Lucror Analytics

Geely (175.HK) - No Volvo, Less Momentum

It is disappointing that Geely has given up on its Volvo merger plan, which would limit the share performance upside in short term.

Victoria Li

Asia HY Trade Book - February 2021 - Lucror Analytics

The Asia HY Trade Book for the month of February includes a summary of our recommendations, as well as our high-conviction ideas. The report also...

Lucror Analytics

Baidu: A Closer Look at Non-Marketing Baidu Core. What Are We Paying for EV?

In this insight, I take a closer look at “Non-marketing Baidu Core” and analyse what the current market value implies for those operations, as well...

Wium Malan, CFA

Texas Weather Deals Second Blow to Automotive Chip Supply Chain

A chip shortage is preventing the automotive industry from returning to full volume. Meanwhile Japan's earthquake and bad weather in Texas are...

Jim Handy

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