Global Emerging Market Equities, Propitious Research

Wium Malan, CFA

Global Emerging Market Equities

Independent, Fundamental Quantitative Research

Propitious Research

Fully independent, fundamental and quantitative equity research, focused on companies in the Telecommunication, Media, Technology, Internet and Healthcare sectors in the Global Emerging Markets. Idea generation focused on Quality stocks, trading below their intrinsic Value, with sound Corporate Governance.

Thematic (Sector/Industry)

<ul>
<li>The Global Emerging Markets weekly provides a summary of the key news and related developments impacting the largest countries and constituents of the Global Emerging Markets equity indices.</li>
<li>
 Macro data points: Chinese inflation data; Malaysian and Indonesian GDP growth</li>
<li>
 Companies mentioned:<a href="https://www.smartkarma.com/entities/taiwan-semiconductor-manufacturing-company" target="_blank" data-smartkarma-citation="entities:11230:1" rel="noopener">Taiwan Semiconductor (TSMC) (2330 TT)</a>, <a href="https://www.smartkarma.com/entities/reliance-communications-ltd" target="_blank" data-smartkarma-citation="entities:5197:1" rel="noopener">Reliance Communications (RCOM IN)</a>, Jio</li>
</ul>


The Global Emerging Markets weekly provides a summary of the key news and related developments impacting the largest countries and constituents of the Global Emerging Markets equity indices.

 Macro data points: Chinese inflation data; Malaysian and Indonesian GDP growth

 Companies mentioned:Taiwan Semiconductor (TSMC) (2330 TT), Reliance Communications (RCOM IN), Jio


GEM Weekly (11 Nov 2022): Chinese Inflation, Malaysia, Indonesia GDP; Reliance, Jio, TSMC

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Event-Driven

On 25 August, the Board of <a href="https://www.smartkarma.com/entities/bharti-airtel-ltd" target="_blank" data-smartkarma-citation="entities:953:1" rel="noopener">Bharti Airtel (BHARTI IN)</a> announced that they would be meeting on 29 August to consider various capital raising options through equity or equity linked or debt instruments or a combination thereof. The stock dropped 4.2% on 26 August and then gained 1.4% on 27 August.Last evening, <a href="https://www.smartkarma.com/entities/bharti-airtel-ltd" target="_blank" data-smartkarma-citation="entities:953:1" rel="noopener">Bharti Airtel (BHARTI IN)</a> announced a 1:14 rights issue (shareholders can subscribe to 1 share for every 14 shares they own) at INR 535/share to raise up to INR 21,000 crores (INR 210 bn; US$2.86bn). That is a 10.1% discount to the last close on the NSE.Subscribers to the issue will need to pay 25% on application and the balance will need to be paid in two additional calls within an overall time horizon of 36 months.The promoter and promoter group will subscribe to the full extent of their entitlement and will also subscribe to any unsubscribed shares in the issue.The record date has not been announced yet and a 'Special Committee of Directors' has been formed to decide other terms and conditions of the offer, including the issue period and record date.Given the small dilution, we do not expect the stock to trade a lot lower today. The stock could trade higher as investors that sold in size on Thursday and Friday re-enter the stock.<a href="https://www.smartkarma.com/entities/bharti-airtel-ltd" target="_blank" data-smartkarma-citation="entities:953:1" rel="noopener">Bharti Airtel (BHARTI IN)</a> has continued to gain subscribers at the expense of <a href="https://www.smartkarma.com/entities/vodafone-idea-ltd" target="_blank" data-smartkarma-citation="entities:15678:1" rel="noopener">Vodafone Idea (IDEA IN)</a> and the rights issue could help cement its position while helping pay the Adjusted Gross Revenue (AGR) dues.

On 25 August, the Board of Bharti Airtel (BHARTI IN) announced that they would be meeting on 29 August to consider various capital raising options through equity or equity linked or debt instruments or a combination thereof. The stock dropped 4.2% on 26 August and then gained 1.4% on 27 August.Last evening, Bharti Airtel (BHARTI IN) announced a 1:14 rights issue (shareholders can subscribe to 1 share for every 14 shares they own) at INR 535/share to raise up to INR 21,000 crores (INR 210 bn; US$2.86bn). That is a 10.1% discount to the last close on the NSE.Subscribers to the issue will need to pay 25% on application and the balance will need to be paid in two additional calls within an overall time horizon of 36 months.The promoter and promoter group will subscribe to the full extent of their entitlement and will also subscribe to any unsubscribed shares in the issue.The record date has not been announced yet and a 'Special Committee of Directors' has been formed to decide other terms and conditions of the offer, including the issue period and record date.Given the small dilution, we do not expect the stock to trade a lot lower today. The stock could trade higher as investors that sold in size on Thursday and Friday re-enter the stock.Bharti Airtel (BHARTI IN) has continued to gain subscribers at the expense of Vodafone Idea (IDEA IN) and the rights issue could help cement its position while helping pay the Adjusted Gross Revenue (AGR) dues.

Bharti Airtel's Large Partly Paid Rights Offering

Over the last couple of days, news agencies have reported that Bharti Telecom is seeking Government approval for an infusion of INR 49 billion (US$690m) from <a href="https://www.smartkarma.com/entities/singapore-telecommunications-limited" target="_blank" rel="noopener" data-smartkarma-citation="entities:20:1">Singtel (ST SP)</a> and other foreign entities. If this goes through, it will take the foreign shareholding in Bharti Telecom above 50%.The implication is that Bharti Telecom's stake in <a href="https://www.smartkarma.com/entities/bharti-airtel-ltd" target="_blank" rel="noopener" data-smartkarma-citation="entities:953:1">Bharti Airtel (BHARTI IN)</a> would be reclassified from domestic to foreign, and foreign shareholding in <a href="https://www.smartkarma.com/entities/bharti-airtel-ltd" target="_blank" rel="noopener" data-smartkarma-citation="entities:953:1">Bharti Airtel (BHARTI IN)</a> would exceed the maximum permissible limit of 74%. Even if the foreign shareholding limit in <a href="https://www.smartkarma.com/entities/bharti-airtel-ltd" target="_blank" rel="noopener" data-smartkarma-citation="entities:953:1">Bharti Airtel (BHARTI IN)</a> is increased to 100%, there will be implications for the stock in global indices.

Over the last couple of days, news agencies have reported that Bharti Telecom is seeking Government approval for an infusion of INR 49 billion (US$690m) from Singtel (ST SP) and other foreign entities. If this goes through, it will take the foreign shareholding in Bharti Telecom above 50%.The implication is that Bharti Telecom's stake in Bharti Airtel (BHARTI IN) would be reclassified from domestic to foreign, and foreign shareholding in Bharti Airtel (BHARTI IN) would exceed the maximum permissible limit of 74%. Even if the foreign shareholding limit in Bharti Airtel (BHARTI IN) is increased to 100%, there will be implications for the stock in global indices.

Bharti Airtel - Implications of Potential Singtel Investment in Bharti Telecom

Consumer Analyst / Channel Surveillance Specialist, Trudence Capital Advisors

Pranav Bhavsar

Consumer Analyst / Channel Surveillance Specialist

ASA Capital Management

ASA Capital Management is a boutique Research and Investment Advisory firm focusing on primary research in India. ASA provides bespoke research services to Institutional Clients with a focus on due diligence backed with primary research, Field Trips & Channel Checks.

Equity Bottom-Up

In this Insight, we present some of the key catalysts that argue for a Buy on <a href="https://www.smartkarma.com/entities/bharti-airtel-ltd" target="_blank" data-smartkarma-citation="entities:953:1" rel="noopener">Bharti Airtel (BHARTI IN)</a> in spite of a sharp rally post Q2 and AGR rulings. Our target price is based on the expected market consolidation, that could lead to subscriber additions, growth in ARPU and the revenue potential that Africa business offers. Compared to the Industry, Airtel's balance sheet is already under repair mode, along with further opportunities for deleveraging. <a href="https://www.smartkarma.com/entities/bharti-airtel-ltd" target="_blank" data-smartkarma-citation="entities:953:1" rel="noopener">Bharti Airtel (BHARTI IN)</a>  seems to be the best positioned to gain from current market consolidation, offering a better return potential compared to Singtel.

In this Insight, we present some of the key catalysts that argue for a Buy on Bharti Airtel (BHARTI IN) in spite of a sharp rally post Q2 and AGR rulings. Our target price is based on the expected market consolidation, that could lead to subscriber additions, growth in ARPU and the revenue potential that Africa business offers. Compared to the Industry, Airtel's balance sheet is already under repair mode, along with further opportunities for deleveraging. Bharti Airtel (BHARTI IN)  seems to be the best positioned to gain from current market consolidation, offering a better return potential compared to Singtel.  

Bharti Airtel (BHARTI IN) | The Last One Standing

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” section, we provide an update on the Chinese property sector, including trends in contracted sales and operations, as well as regulatory developments. 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” section, we provide an update on the Chinese property sector, including trends in contracted sales and operations, as well as regulatory developments.    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 - Chinese Property Update - Lucror Analytics

India

Reliance Communications Ltd. offers integrated telephone services. The Company offers fixed line and wireless voice, data and video transmission services, and Internet access.

Reliance Communications (RCOM IN)

GEM Weekly (11 Nov 2022): Chinese Inflation, Malaysia, Indonesia GDP; Reliance, Jio, TSMC

The Global Emerging Markets weekly provides a summary of the key news and related developments impacting the largest countries and constituents of...

Wium Malan, CFA

Bharti Airtel's Large Partly Paid Rights Offering

Bharti Airtel has announced a US$2.8bn rights offer. This is a partly paid offering with 25% paid upfront and 2 calls within 36 months. Expect the...

Brian Freitas

Bharti Airtel - Implications of Potential Singtel Investment in Bharti Telecom

Over the last couple of days, news agencies have reported that Bharti Telecom is seeking Government approval for an infusion of INR 49 billion...

Brian Freitas

Bharti Airtel (BHARTI IN) | The Last One Standing

In this Insight, we present some of the key catalysts that argue for a Buy on Bharti Airtel (BHARTI IN) in spite of a sharp rally post Q2 and AGR...

Pranav Bhavsar

Asia HY Monthly - Chinese Property Update - Lucror Analytics

In this month’s “In-Focus” section, we provide an update on the Chinese property sector, including trends in contracted sales and operations, as...

Lucror Analytics