IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Equity Bottom-Up

<ul>
<li>
<a href="https://jehoshaphatresearch.com/wp-content/uploads/669HK-Short-Report-Feb-2023-Jehoshaphat-Research.pdf" target="_blank" rel="noopener">Jehoshaphat's short report</a> has alleged that <a href="https://www.smartkarma.com/entities/techtronic-industries-co-ltd" target="_blank" data-smartkarma-citation="entities:4561:1" rel="noopener">Techtronic Industries (669 HK)</a>/TTI has been inflating its profits dramatically for over a decade with manipulative accounting.</li>
<li>Our forensic analysis of the allegations suggests that some are credible red flags while others are essentially an exaggeration.</li>
<li>TTI’s response to Jehoshaphat is pitiful. Valuation is meaningless until management adopts more conservative accounting or compelling disprove the allegations.</li>
</ul>



Jehoshaphat's short report has alleged that Techtronic Industries (669 HK)/TTI has been inflating its profits dramatically for over a decade with manipulative accounting.
Our forensic analysis of the allegations suggests that some are credible red flags while others are essentially an exaggeration.
TTI’s response to Jehoshaphat is pitiful. Valuation is meaningless until management adopts more conservative accounting or compelling disprove the allegations.


Techtronic Industries (669 HK): Forensic Analysis Viewpoint

Equity Analyst, LightStream Research

Shifara Samsudeen, FCMA, CGMA

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Forensic Accounting

Techtronic Industries / Forensic Accounting

<ul>
<li>
<a href="https://www.smartkarma.com/entities/techtronic-industries-co-ltd" target="_blank" data-smartkarma-citation="entities:4561:1" rel="noopener">Techtronic Industries (669 HK)</a> was targeted by Jehoshaphat Research (JR) accusing that the company’s profits are inflated dramatically over a decade with manipulative accounting.</li>
<li>As per the report, routine expenses incurred have been booked under various asset accounts such as deferred development costs thereby showing ever increasing margins for a cyclical business.</li>
<li>We have assessed the merits of some of these claims using our forensic accounting framework and it appears that most of the claims are very difficult to refute.</li>
</ul>



Techtronic Industries (669 HK) was targeted by Jehoshaphat Research (JR) accusing that the company’s profits are inflated dramatically over a decade with manipulative accounting.
As per the report, routine expenses incurred have been booked under various asset accounts such as deferred development costs thereby showing ever increasing margins for a cyclical business.
We have assessed the merits of some of these claims using our forensic accounting framework and it appears that most of the claims are very difficult to refute.


Techtronic Industries: Jehoshaphat Research’s Allegations and Our Assessment

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>Jehoshaphat Research (JR) argues the case that <strong><a href="https://www.smartkarma.com/entities/techtronic-industries-co-ltd" target="_blank" data-smartkarma-citation="entities:4561:1" rel="noopener">Techtronic Industries (669 HK)</a></strong> has been engaged in “snowballing” to maintain margin growth.</li>
<li>JR flags TTI is the only public company in the world (with over $1bn in revenues) exhibiting positive sequential gross margin change in every semi-annual period over ten years.</li>
<li>Short interest had been picking up ahead of the short sell report. Shares fell 19% before being suspended in the afternoon session.  </li>
</ul>


Jehoshaphat Research (JR) argues the case that Techtronic Industries (669 HK) has been engaged in “snowballing” to maintain margin growth.
JR flags TTI is the only public company in the world (with over $1bn in revenues) exhibiting positive sequential gross margin change in every semi-annual period over ten years.
Short interest had been picking up ahead of the short sell report. Shares fell 19% before being suspended in the afternoon session.  


Techtronic Industries (669 HK): JR Puts Down That Tool

Asia Pac ECM and Index Rebal, Shenton Research

Ke Yan, CFA, FRM

Asia Pac ECM and Index Rebal

Asia Pac IPO & Placement Research, China Biotech

DZT Research

DZT Research is an independent Asia Pacific equity specialist. Our quantitative research covers index rebalancing flows, alongside exchange data analytics accross Asia Pacific. On the equity capital markets side, we focus on Asia Pacific ECM, especially biotech and TMT. Our lead analyst is frequently cited by international media.

Quantitative Analysis

<ul>
<li>We analyzed the latest HK SFC report for aggregate short position as of Feb 3rd.</li>
<li>Top short increases and decreases were tabulated for one week and four week period. </li>
<li>We highlight short changes in Bidu, Manulife, Mengniu Dairy, CDF, Tencent, Baba, Anta Sports, Wuxi Bio.</li>
</ul>


We analyzed the latest HK SFC report for aggregate short position as of Feb 3rd.
Top short increases and decreases were tabulated for one week and four week period. 
We highlight short changes in Bidu, Manulife, Mengniu Dairy, CDF, Tencent, Baba, Anta Sports, Wuxi Bio.


HK Short Interest Weekly: Short Covers for Tencent, Baba, Anta, Wuxi Biologics

HK/China Equity Long-Short

Osbert Tang, CFA

<ul>
<li>"Buy the Worst" strategy returned 1.9% in 2022, sharply outperformed HSI's 15% drop. In the last two years, this strategy recorded massive aggregate outperformance of 41pp against HSI.</li>
<li>For 2023, we expect to switch into <a href="https://www.smartkarma.com/entities/country-garden-holdings-co" target="_blank" data-smartkarma-citation="entities:5225:1" rel="noopener">Country Garden (2007 HK)</a>, <a href="https://www.smartkarma.com/entities/sunny-optical-tech" target="_blank" data-smartkarma-citation="entities:13363:1" rel="noopener">Sunny Optical (2382 HK)</a>, <a href="https://www.smartkarma.com/entities/country-garden-services-holdings-company-limited" target="_blank" data-smartkarma-citation="entities:27343:1" rel="noopener">Country Garden Services (6098 HK)</a>, <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> and <a href="https://www.smartkarma.com/entities/techtronic-industries-co-ltd" target="_blank" data-smartkarma-citation="entities:4561:1" rel="noopener">Techtronic Industries (669 HK)</a>. </li>
<li>Aggressive investors can consider shorting 2022 best-performing portfolio of <a href="https://www.smartkarma.com/entities/sands-china-ltd" target="_blank" data-smartkarma-citation="entities:182:1" rel="noopener">Sands China (1928 HK)</a>, <a href="https://www.smartkarma.com/entities/haidilao-international-holding-ltd" target="_blank" data-smartkarma-citation="entities:27044:1" rel="noopener">Haidilao (6862 HK)</a>, <a href="https://www.smartkarma.com/entities/galaxy-entertainment-group-limited" target="_blank" data-smartkarma-citation="entities:806:1" rel="noopener">Galaxy Entertainment (27 HK)</a>, <a href="https://www.smartkarma.com/entities/china-shenhua-energy-co-h" target="_blank" data-smartkarma-citation="entities:382:1" rel="noopener">China Shenhua (1088 HK)</a> and <a href="https://www.smartkarma.com/entities/china-unicom-hong-kong-ltd" target="_blank" data-smartkarma-citation="entities:1016:1" rel="noopener">China Unicom (762 HK)</a>. </li>
</ul>


"Buy the Worst" strategy returned 1.9% in 2022, sharply outperformed HSI's 15% drop. In the last two years, this strategy recorded massive aggregate outperformance of 41pp against HSI.
For 2023, we expect to switch into Country Garden (2007 HK), Sunny Optical (2382 HK), Country Garden Services (6098 HK), Geely Auto (175 HK) and Techtronic Industries (669 HK). 
Aggressive investors can consider shorting 2022 best-performing portfolio of Sands China (1928 HK), Haidilao (6862 HK), Galaxy Entertainment (27 HK), China Shenhua (1088 HK) and China Unicom (762 HK). 


"Buy the Worst" HSI Strategy: Big Win in 2022 and Let's See if It Can Sustain in 2023

Hong Kong

Techtronic Industries designs, produces, and markets cordless power tools, outdoor power equipment, hand tools, and floor care appliances. Its diverse brand portfolio includes Milwaukee, Ryobi, AEG, Hoover, and Dirt Devil. The company was founded in 1985 and is headquartered in Hong Kong.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Techtronic Industries (669 HK)