Technology / Semiconductor / Internet Research

Nicolas Baratte

Equity Bottom-Up

Infineon Technologies  / Equity Bottom-Up

<ul>
<li>Very large miss. Sept-24 (4Q FY24) EPS -30% below Consensus.  Dec-24 (1Q FY25) revenue guidance -16% below Consensus, operating profit at least -20% below Consensus.</li>
<li>End-Demand is slow, large inventory destocking will continue into 1H FY25, followed by “no hockey stick recovery” in 2H FY25. “Current visibility is very low”. </li>
<li>For FY25 (starting in Dec-24 quarter), Consensus assumes +17% revenue growth YoY, management guided for a slight decline. Adding some margins compression, FY25 Consensus Net Income  is ~25-30% too high.   </li>
</ul>


Very large miss. Sept-24 (4Q FY24) EPS -30% below Consensus.  Dec-24 (1Q FY25) revenue guidance -16% below Consensus, operating profit at least -20% below Consensus.
End-Demand is slow, large inventory destocking will continue into 1H FY25, followed by “no hockey stick recovery” in 2H FY25. “Current visibility is very low”. 
For FY25 (starting in Dec-24 quarter), Consensus assumes +17% revenue growth YoY, management guided for a slight decline. Adding some margins compression, FY25 Consensus Net Income  is ~25-30% too high.   


Infineon: Large Miss and Reset. Auto & Industrial Semi Is a Good Space for Shorts.

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Event-Driven

<ul>
<li>Following up on our earlier cross-shareholding work, in this note we look to summarize our work so far by looking at where most of the selling will likely come.</li>
<li>Of the seven companies that we have looked at so far, collectively they have around US$102bn worth of shares to sell in 118 companies. </li>
<li>Of these, they have a combined stake of over US$1bn in 23 companies.</li>
</ul>


Following up on our earlier cross-shareholding work, in this note we look to summarize our work so far by looking at where most of the selling will likely come.
Of the seven companies that we have looked at so far, collectively they have around US$102bn worth of shares to sell in 118 companies. 
Of these, they have a combined stake of over US$1bn in 23 companies.


Japan Cross-Shareholding - Summary Matrix - Over US$100bn of Selling in 118 Companies

<ul>
<li>With <a href="https://www.smartkarma.com/entities/toyota-motor-corp" target="_blank" data-smartkarma-citation="entities:73:1" rel="noopener">Toyota (7203 JP)</a> having sold some of its stake in <a href="https://www.smartkarma.com/entities/denso-corp" target="_blank" data-smartkarma-citation="entities:18703:1" rel="noopener">Denso</a>, <a href="https://www.smartkarma.com/entities/kddi-corp" target="_blank" data-smartkarma-citation="entities:639:1" rel="noopener">KDDI</a> and <a href="https://www.smartkarma.com/entities/harmonic-drive-systems-inc" target="_blank" data-smartkarma-citation="entities:10238:1" rel="noopener">Harmonic Drive</a> this year, it has firmly set the ball rolling for unwinding some of its cross-shareholding.</li>
<li>Toyota has a shareholding in around 60 listed companies, with its combined disposable stake worth over US$26bn.</li>
<li>In this note, we take a look at its stakes in various companies to see which ones could possibly be candidates for further selldowns.</li>
</ul>


With Toyota (7203 JP) having sold some of its stake in Denso, KDDI and Harmonic Drive this year, it has firmly set the ball rolling for unwinding some of its cross-shareholding.
Toyota has a shareholding in around 60 listed companies, with its combined disposable stake worth over US$26bn.
In this note, we take a look at its stakes in various companies to see which ones could possibly be candidates for further selldowns.


Toyota Cross-Shareholding - To Say a Whole Lot Is Left Would Be a US$26bn Understatement

Mitsubishi UFJ Financial (MUFG) / Event-Driven

Mitsubishi UFJ Financial (MUFG) (8306 JP)

<ul>
<li>Following up on our earlier cross-shareholding notes, in this note we look at <a href="https://www.smartkarma.com/entities/mitsubishi-ufj-financial-group" target="_blank" data-smartkarma-citation="entities:218:1" rel="noopener">Mitsubishi UFJ Financial (MUFG) (8306 JP)</a>’s cross-shareholding.</li>
<li>MUFG had a stake over US$100m in at least 47 listed Japanese stocks, amounting to a total of around US$19bn.</li>
<li>In this note, we take a look at its stakes in various companies to see which ones could possibly be candidates for further selldowns.</li>
</ul>


Following up on our earlier cross-shareholding notes, in this note we look at Mitsubishi UFJ Financial (MUFG) (8306 JP)’s cross-shareholding.
MUFG had a stake over US$100m in at least 47 listed Japanese stocks, amounting to a total of around US$19bn.
In this note, we take a look at its stakes in various companies to see which ones could possibly be candidates for further selldowns.


MUFG Cross-Shareholding - At Least US$20bn of Cross-Shareholding to Sell, Taking It Slow

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Equity Capital Markets

<ul>
<li>Yesterday, Reuters reported that multiple Toyota Group companies would sell ~10% of <a href="https://www.smartkarma.com/entities/denso-corp" target="_blank" data-smartkarma-citation="entities:18703:1" rel="noopener">Denso Corp (6902 JP)</a> worth ¥700bn in a secondary share sale by year-end.</li>
<li>The sellers would be Toyota, selling down to just over 20%, Toyota Industries (6201) (selling down a bit more than half, and <a href="https://www.smartkarma.com/entities/aisin-seiki-co-ltd" target="_blank" data-smartkarma-citation="entities:11809:1" rel="noopener">Aisin Seiki (7259 JP)</a> selling its 2% stake. </li>
<li>Denso would buy back shares. This whole thing is both interesting and complicated so I discuss the interesting complications below. It <em>looks</em> bigger than it probably is.</li>
</ul>


Yesterday, Reuters reported that multiple Toyota Group companies would sell ~10% of Denso Corp (6902 JP) worth ¥700bn in a secondary share sale by year-end.
The sellers would be Toyota, selling down to just over 20%, Toyota Industries (6201) (selling down a bit more than half, and Aisin Seiki (7259 JP) selling its 2% stake. 
Denso would buy back shares. This whole thing is both interesting and complicated so I discuss the interesting complications below. It looks bigger than it probably is.


Huge Denso (6902) Secondary Sale by Toyota Group - Admiral Ackbar Says "It's A Trap!"

Japan

Renesas Electronics Corporation researches, develops, designs and manufactures electronic components such as semiconductors and integrated devices.

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Renesas Electronics (6723 JP)

Infineon: Large Miss and Reset. Auto & Industrial Semi Is a Good Space for Shorts.

On Consensus before earnings release, the stock trades at 12.5x FY25. After Consensus adjustment, the stock should be trading at ~16-17x FY25 EPS.

Nicolas Baratte

Japan Cross-Shareholding - Summary Matrix - Over US$100bn of Selling in 118 Companies

Toyotal has just announced that it will buy back around 290m (around 2% of the stock) of its own shares from MS&AD, Tokio Marine, MUFG and SMFG. In...

Sumeet Singh

Toyota Cross-Shareholding - To Say a Whole Lot Is Left Would Be a US$26bn Understatement

Toyota, Toyota Industries and Denso are tag teaming to unwind some of their stake in Aisin, in a deal worth over US$1bn. While the timing of the...

Sumeet Singh

MUFG Cross-Shareholding - At Least US$20bn of Cross-Shareholding to Sell, Taking It Slow

Following up on our earlier cross-shareholding notes, in this note we look at MUFG (8306 JP)’s cross-shareholding. MUFG had a stake of over US$100m...

Sumeet Singh

Huge Denso (6902) Secondary Sale by Toyota Group - Admiral Ackbar Says "It's A Trap!"

Toyota Group will do a large secondary offering of Denso (6902) shares. Toyota, Toyota Industries, and Aishin will sell. This is more complicated...

Travis Lundy

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