Equity, Bottom-up Analyst, Investics Research

Sameer Taneja

Equity, Bottom-up Analyst

Investics Research

It is important to note that the information provided by Investics Research is based on publicly available data and own knowledge, which has been gathered and analyzed from a variety of sources. While every effort has been made to ensure the accuracy and completeness of the information provided, it is not guaranteed to be free from errors or omissions. All forecasts and estimates are based on information that has been obtained from public sources that are considered to be reliable. The sources include but are not limited to, company announcements, exchange filings, presentations, etc. Investics does not guarantee the accuracy and completeness of the forecasts, estimates, and/or other information.

Equity Bottom-up Research

Equity Bottom-Up

<ul>
<li>With increasing market volatility, base metals continue their rocky weekly performance. Copper is up marginally, taking it past 9000 USD/ton.</li>
<li>Copper inventories continue to pile at the exchanges, with ~500k tons combined at Comex, LME, and Shanghai, up almost 7% in the last two weeks. </li>
<li>We believe accumulating names like <a href="https://www.smartkarma.com/entities/southern-copper-corp" target="_blank" rel="noopener">Southern Copper (SCCO US)</a> and <a href="https://www.smartkarma.com/entities/ivanhoe-mines-ltd" target="_blank" rel="noopener">Ivanhoe Mines (IVN CN)</a> with good long-term fundamentals is a great strategy. </li>
</ul>


With increasing market volatility, base metals continue their rocky weekly performance. Copper is up marginally, taking it past 9000 USD/ton.
Copper inventories continue to pile at the exchanges, with ~500k tons combined at Comex, LME, and Shanghai, up almost 7% in the last two weeks. 
We believe accumulating names like Southern Copper (SCCO US) and Ivanhoe Mines (IVN CN) with good long-term fundamentals is a great strategy. 


Copper Tracker August 19th, 2024: Markets Volatile, Accumulate Good Copper Names On Weakness

<ul>
<li>Copper declined below the 9,000 USD/ton levels (WoW by -0.5%) due to weakness in financial markets caused by the Federal Reserve's slowness in cutting rates. </li>
<li>Positive signs for copper were the Yangshan Copper Premium inflecting into positive territory and combined inventory on all exchanges being drawn down by almost 5%. </li>
<li>
<a href="https://www.smartkarma.com/entities/lundin-mining-corp-92352503-3781-4fcb-a4db-62e6f6343783" target="_blank" data-smartkarma-citation="entities:25356:1" rel="noopener">Lundin Mining (LUN CN)</a> and <a href="https://www.smartkarma.com/entities/bhp-group-ltd" target="_blank" data-smartkarma-citation="entities:147:1" rel="noopener">BHP Group Ltd (BHP AU)</a> will acquire <a href="https://www.smartkarma.com/entities/filo-corp" target="_blank" data-smartkarma-citation="entities:42545:1" rel="noopener">Filo (FIL CN)</a> for 4.1 bn CAD and develop the <a href="https://lundinmining.com/news/lundin-mining-and-bhp-to-acquire-filo-and-form-a-5-123162/" target="_blank" rel="noopener">Josemaria project in Argentina</a>. </li>
</ul>


Copper declined below the 9,000 USD/ton levels (WoW by -0.5%) due to weakness in financial markets caused by the Federal Reserve's slowness in cutting rates. 
Positive signs for copper were the Yangshan Copper Premium inflecting into positive territory and combined inventory on all exchanges being drawn down by almost 5%. 

Lundin Mining (LUN CN) and BHP Group Ltd (BHP AU) will acquire Filo (FIL CN) for 4.1 bn CAD and develop the Josemaria project in Argentina. 


Copper Tracker August 5th, 2024: Physical/​Equity Screens And Trades, Positive Signs For Copper

<ul>
<li>
<a href="https://www.smartkarma.com/entities/southern-copper-corp" target="_blank" data-smartkarma-citation="entities:16279:1" rel="noopener">Southern Copper (SCCO US)</a> posted a 6% EBITDA beat and a 17% EPS beat buoyed by higher pricing of copper and by-products</li>
<li>Sales/EBITDA/Profit increased by 35.5%/61%/72% YoY. It also guided a positive outlook for copper, highlighting a tightening of the physical market boding well for future quarters. </li>
<li>The board paid a 1.20 USD/share quarterly dividend in 50:50 scrip/cash. It will probably continue this practice, considering the elevated capex/ debt repayment of 500 mn USD in April 2025.</li>
</ul>



Southern Copper (SCCO US) posted a 6% EBITDA beat and a 17% EPS beat buoyed by higher pricing of copper and by-products
Sales/EBITDA/Profit increased by 35.5%/61%/72% YoY. It also guided a positive outlook for copper, highlighting a tightening of the physical market boding well for future quarters. 
The board paid a 1.20 USD/share quarterly dividend in 50:50 scrip/cash. It will probably continue this practice, considering the elevated capex/ debt repayment of 500 mn USD in April 2025.


Southern Copper (SCCO US) Concall Highlights: Great Q2 2024, FY24 Production Guide Up

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/mmg-ltd" target="_blank" data-smartkarma-citation="entities:13961:1" rel="noopener">Mmg Ltd (1208 HK)</a> today announced a 2:5 Rights Offering to raise US$1.15bn at HK$2.62/share in order to pay down debt from their recent Botswanan copper mine acquisition. </li>
<li>It was a sizeable acquisition, and the near-term EV/EBITDA of the acquisition is 10x or above. The longer-term EV/EBITDA is in the 3s based on expansion later this decade.</li>
<li>The Rights Offering is underwritten, supported by its 67.5% owner. SOUTHBOUND holds 10+%. There are short dynamics, arb dynamics, "don't wanna spend more" dynamics. There's a path here.</li>
</ul>



Mmg Ltd (1208 HK) today announced a 2:5 Rights Offering to raise US$1.15bn at HK$2.62/share in order to pay down debt from their recent Botswanan copper mine acquisition. 
It was a sizeable acquisition, and the near-term EV/EBITDA of the acquisition is 10x or above. The longer-term EV/EBITDA is in the 3s based on expansion later this decade.
The Rights Offering is underwritten, supported by its 67.5% owner. SOUTHBOUND holds 10+%. There are short dynamics, arb dynamics, "don't wanna spend more" dynamics. There's a path here.


MMG (1208 HK) - $1.1bn+ Rights Offering - Expect Regular Rights Trading Dynamics

Independent research on the U.S. markets, Baptista Research

Baptista Research

Independent research on the U.S. markets

Baptista Research is an independent financial research house focused on the U.S. markets. We provide equity research as well as credit research reports on the top-listed U.S. companies with most of our focus on technology, consumer goods and services, automobiles, industrials, oil and gas, pharma, and healthcare. Our research has served more than 3000 institutional investors including mutual funds, hedge funds, banks, family offices, and various buy-side firms. We operate a research subscription service where institutions, as well as retail investors, can have priority access to all our research. We also have a wide distribution of our research reports across some of the top global financial platforms. Apart from equity research and credit research, we also provide advisory services with respect to mergers & acquisitions (M&A), private equity/ venture capital fundraising, valuation reports, and investment management services for corporates.
Baptista Research is owned and managed by Ishan Majumdar, an ex-Venture Capitalist/ Investment Banker, a Chartered Accountant, and a Masters’ degree holder in Management from HEC Paris. Ishan has nearly a decade of experience in Mergers and Acquisitions, Leveraged Buyouts (LBOs), Venture Capital Investing, Corporate Strategy, and Valuation in front-office roles at the likes of BNP Paribas CIB, Credit Agricole CIB, Groupe Danone, and TIW Private Equity. He has worked on and closed multiple acquisition deals, leveraged buyouts, and start-up investment transactions.

<ul><li>Southern Copper Corporation performed admirably in 2023 despite facing some challenges.</li><li>The company reported net sales of $9,896 million, a decrease of 1.5% compared to 2022.</li><li>This was primarily due to higher copper and molybdenum sales volumes, increased molybdenum and silver prices, and a reduction in copper and zinc metal prices along with decreased silver and zinc sales volumes.</li></ul>

Southern Copper Corporation performed admirably in 2023 despite facing some challenges.The company reported net sales of $9,896 million, a decrease of 1.5% compared to 2022.This was primarily due to higher copper and molybdenum sales volumes, increased molybdenum and silver prices, and a reduction in copper and zinc metal prices along with decreased silver and zinc sales volumes.

Southern Copper Corporation: What Is The Current Impact Of Copper Market Dynamics & Prices - Major Drivers

United States

Southern Copper Corporation conducts mining operations in Peru and Mexico.  The Company owns and operates open pit mines and metallurgical complexes that produce copper, molybdenum, zinc, and precious metals.

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Southern Copper (SCCO US)

Copper Tracker August 19th, 2024: Markets Volatile, Accumulate Good Copper Names On Weakness

This brief insight summarizes Copper's performance and equities on our screens. We highlight our research and trades to explore.

Sameer Taneja

Copper Tracker August 5th, 2024: Physical/Equity Screens And Trades, Positive Signs For Copper

This brief insight summarizes Copper's performance and equities on our screens. We highlight our research and trades to explore.

Sameer Taneja