Financials & FinTech research, Galliano’s Financials Research

Victor Galliano

Financials & FinTech research

Financials & FinTech, EM & Developed Markets

Galliano’s Financials Research

Galliano's Financials Research provides fundamental research in Emerging Markets financials, including FinTech, as well as financials in select Developed Markets.

The investment style applied is generally value oriented, although Growth At Reasonable Price (GARP) strategies can also be used where appropriate. 

Our investment research approach aim is often contrarian, looking to capitalise on overly sceptical or optimistic consensus views. In terms of valuation techniques, the focus is on PBV ratio to ROE, PE multiples and dividend yield, as well as the application of PEG ratios and, where appropriate, Sum of the Parts (SOTP) valuations.

Equity Bottom-Up

<ul>
<li>The six Malaysian banks screen favourably on balance sheet and returns metrics to June 2022; we add CIMB to the buy list, keep RHB and we remove Maybank</li>
<li>We add CIMB with its positive post-provision return trends and further potential which combine constructively with CIMB’s undemanding valuations versus the peer group; its high NPL ratio is fully provisioned</li>
<li>We stick with RHB, with its attractive post-provision profitability and positive cost of risk trends, whilst also trading on attractive multiples versus peers and on a relatively low PEG</li>
</ul>


The six Malaysian banks screen favourably on balance sheet and returns metrics to June 2022; we add CIMB to the buy list, keep RHB and we remove Maybank
We add CIMB with its positive post-provision return trends and further potential which combine constructively with CIMB’s undemanding valuations versus the peer group; its high NPL ratio is fully provisioned
We stick with RHB, with its attractive post-provision profitability and positive cost of risk trends, whilst also trading on attractive multiples versus peers and on a relatively low PEG


Malaysian Banks June 2022 Screener; CIMB Is Our New Value Pick

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

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Index Rebalance

<ul>
<li>
<a href="https://www.smartkarma.com/entities/ammb-holdings-bhd" target="_blank" data-smartkarma-citation="entities:137:1" rel="noopener">AMMB Holdings (AMM MK)</a> and <a href="https://www.smartkarma.com/entities/ql-resources-bhd" target="_blank" data-smartkarma-citation="entities:11221:1" rel="noopener">Ql Resources (QLG MK)</a> could replace <a href="https://www.smartkarma.com/entities/hartalega-holdings-bhd" target="_blank" data-smartkarma-citation="entities:10230:1" rel="noopener">Hartalega Holdings (HART MK)</a> and <a href="https://www.smartkarma.com/entities/top-glove-corp-bhd" target="_blank" data-smartkarma-citation="entities:20759:1" rel="noopener">Top Glove Corp (TOPG MK)</a> at the December rebalance.</li>
<li>One way turnover is estimated at 2.87% and the impact of passive flows is larger on the potential adds as compared to the potential deletes.</li>
<li>
<a href="https://www.smartkarma.com/entities/westports-holdings-bhd" target="_blank" data-smartkarma-citation="entities:3954:1" rel="noopener">Westports Holdings (WPRTS MK)</a> is a close add and there could be changes over the next few months as we approach the end of the review period.</li>
</ul>



AMMB Holdings (AMM MK) and Ql Resources (QLG MK) could replace Hartalega Holdings (HART MK) and Top Glove Corp (TOPG MK) at the December rebalance.
One way turnover is estimated at 2.87% and the impact of passive flows is larger on the potential adds as compared to the potential deletes.

Westports Holdings (WPRTS MK) is a close add and there could be changes over the next few months as we approach the end of the review period.


KLCI Index Rebalance Preview: The Gloves Could Come Off

<ul>
<li>The six Malaysian banks have healthy capital adequacy ratios, healthy credit quality and adequate NPL coverage; increased tourism should support GDP, positive cost of risk trends and loan growth demand</li>
<li>We like RHB, with its attractive post-provision profitability and sound cost of risk trends, whilst also trading on attractive multiples versus peers and on a relatively low PEG</li>
<li>We also like big-cap Maybank with its reasonable valuations; combined with a prospective earnings recovery due to contained risk costs, this could drive a re-rating, after lacklustre share returns</li>
</ul>


The six Malaysian banks have healthy capital adequacy ratios, healthy credit quality and adequate NPL coverage; increased tourism should support GDP, positive cost of risk trends and loan growth demand
We like RHB, with its attractive post-provision profitability and sound cost of risk trends, whilst also trading on attractive multiples versus peers and on a relatively low PEG
We also like big-cap Maybank with its reasonable valuations; combined with a prospective earnings recovery due to contained risk costs, this could drive a re-rating, after lacklustre share returns


Malaysian Banks Screener; RHB Bank Is Our Top Pick

Alpha-Centric ESG Research

Kyle Rudden

<ul>
<li>
<a href="https://www.smartkarma.com/entities/carsome-group" target="_blank" data-smartkarma-citation="entities:35913:1" rel="noopener">Carsome (CARSOME1 SP)</a>, Malaysia's used-car eCommerce/technology unicorn, has reportedly submitted a confidential IPO filing for a dual listing on Nasdaq and <a href="https://www.smartkarma.com/entities/singapore-exchange-ltd" target="_blank" data-smartkarma-citation="entities:1047:1" rel="noopener">Singapore Exchange</a>.</li>
<li>Carsome has a great ESG story to tell, but needs to be less humble about telling it because pre-IPO ESG messaging can impact IPO valuations, especially for transportation-related deals.</li>
<li>The centerpiece of Carsome's ESG story should be the important (but underappreciated) role of used car markets in decarbonising road transportation, a leading source of carbon emissions.</li>
</ul>



Carsome (CARSOME1 SP), Malaysia's used-car eCommerce/technology unicorn, has reportedly submitted a confidential IPO filing for a dual listing on Nasdaq and Singapore Exchange.
Carsome has a great ESG story to tell, but needs to be less humble about telling it because pre-IPO ESG messaging can impact IPO valuations, especially for transportation-related deals.
The centerpiece of Carsome's ESG story should be the important (but underappreciated) role of used car markets in decarbonising road transportation, a leading source of carbon emissions.


Carsome: A Paradigm of Circular Economy and Unsung Hero in the Decarbonisation of Transportation

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.

Equity Capital Markets

Press Metal Aluminium Holdin / Equity Capital Markets

<ul>
<li>Press Metal Aluminum Holdings (PMAH) aims to raise around US$233m via a primary placement.</li>
<li>The stock has been doing well on the back of buoyant Aluminum prices over the past few months.</li>
<li>In this note, we will run the deal through our ECM framework and talk about the recent updates.</li>
</ul>


Press Metal Aluminum Holdings (PMAH) aims to raise around US$233m via a primary placement.
The stock has been doing well on the back of buoyant Aluminum prices over the past few months.
In this note, we will run the deal through our ECM framework and talk about the recent updates.


Press Metals Aluminum Holdings Placement - Well Flagged Deal, Stock Has Done Well

Malaysia

RHB Bank BHD provides banking services. The Company offers commercial and consumer banking, corporate and investment banking, and international banking services. RHB also provides savings accounts, foreign currency accounts, home and travel insurance, and investment planning.

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RHB Bank Bhd (RHBBANK MK)

Malaysian Banks June 2022 Screener; CIMB Is Our New Value Pick

We add CIMB to the buy list, keep RHB and we remove Maybank; CIMB has positive post-provision return trends and undemanding valuations; RHB has...

Victor Galliano

KLCI Index Rebalance Preview: The Gloves Could Come Off

AMMB and QL Resources could replace Hartalega and Top Glove in the KLCI at the December rebalance. Westports is a close add, while Top Glove needs...

Brian Freitas

Malaysian Banks Screener; RHB Bank Is Our Top Pick

From our Malaysian banks screener report, we like RHB for its attractive post-provision returns and undemanding multiples, and Maybank for its...

Victor Galliano

Carsome: A Paradigm of Circular Economy and Unsung Hero in the Decarbonisation of Transportation

Carsome has reportedly filed for an IPO (dual Nasdaq/SGX listing), and has a great ESG story to tell investors including the role that used car...

Kyle Rudden

Press Metals Aluminum Holdings Placement - Well Flagged Deal, Stock Has Done Well

Press Metal Aluminum Holdings (PMAH) aims to raise around US$233m via a primary placement. In this note, we will run the deal through our ECM...

Sumeet Singh

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52-week Range

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