Global Materials | Industrials | Commodities

Rahul Jain

Equity Bottom-Up

<ul>
<li>Funding not a hurdle: Promoter strength provides comfort despite past negative precedents.</li>
<li>Valuation undemanding: Entry at ~US$440–475/t is below replacement cost and past cycle-peak deals.</li>
<li>Execution heavy: Success depends on managing restructuring, integration, and EU policy commitments.</li>
</ul>


Funding not a hurdle: Promoter strength provides comfort despite past negative precedents.
Valuation undemanding: Entry at ~US$440–475/t is below replacement cost and past cycle-peak deals.
Execution heavy: Success depends on managing restructuring, integration, and EU policy commitments.


Naveen Jindal’s Bid for Thyssenkrupp Steel Europe – Sensible Valuation, Execution Critical

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>Thyssenkrupp's recent financial performance and strategic progress provide a mixed outlook for investors.</li>
<li>The company is undergoing significant transformation, focusing on becoming a strategic holding entity with independently managed business segments.</li>
<li>A key element of this transformation is the planned spin-off of thyssenkrupp Marine Systems in 2025, which is on track and backed by strong shareholder support.</li>
</ul>


Thyssenkrupp's recent financial performance and strategic progress provide a mixed outlook for investors.
The company is undergoing significant transformation, focusing on becoming a strategic holding entity with independently managed business segments.
A key element of this transformation is the planned spin-off of thyssenkrupp Marine Systems in 2025, which is on track and backed by strong shareholder support.


Thyssenkrupp Is Reshaping Its Steel Future With 11,000 Job Cuts; What’s The Expected Margin Impact?

<ul>
<li>ThyssenKrupp's recent earnings call highlighted both challenges and opportunities as the company maneuvers through a tough market environment.</li>
<li>The strategic decision to spin off Marine Systems by 2025 is underscored as a pivotal move alongside receiving a significant cash inflow from the sale of Key Electrical Steel India, bolstering the company's financial stance.</li>
<li>Notably, there is a focus on restructuring and adapting to market conditions, evidenced by ongoing negotiations with IG Metall to reconfigure their Steel Europe operations.</li>
</ul>


ThyssenKrupp's recent earnings call highlighted both challenges and opportunities as the company maneuvers through a tough market environment.
The strategic decision to spin off Marine Systems by 2025 is underscored as a pivotal move alongside receiving a significant cash inflow from the sale of Key Electrical Steel India, bolstering the company's financial stance.
Notably, there is a focus on restructuring and adapting to market conditions, evidenced by ongoing negotiations with IG Metall to reconfigure their Steel Europe operations.


ThyssenKrupp - Hidden Value in Elevator Business—A Game Changer?

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>On 30 October, an FT <a href="https://www.ft.com/content/d237189f-d372-474d-981e-c1d3b32c3c8c" target="_blank" rel="noopener">article</a> appeared which pushed <a href="https://www.smartkarma.com/entities/fujitec-co-ltd" target="_blank" data-smartkarma-citation="entities:11686:1" rel="noopener">Fujitec Co Ltd (6406 JP)</a> shares sharply higher. The headline? <em>"Japanese lift maker Fujitec explores sale to private equity"</em>
</li>
<li>The next day, mid-day, Fujitec "<a href="https://www.fujitec.com/uploads/2024/10/241031_hodo_en.pdf" target="_blank" rel="noopener">corrected</a>" the record, saying the articles (FT and others, presumably) contained "inaccuracies", including that "Fujitec is working to find a buyer."</li>
<li>They mention they have received a preliminary and non-binding initial proposal. The stock continued higher after that. Now investors have to decide how attractive an elevator/escalator business really is.</li>
</ul>


On 30 October, an FT article appeared which pushed Fujitec Co Ltd (6406 JP) shares sharply higher. The headline? "Japanese lift maker Fujitec explores sale to private equity"

The next day, mid-day, Fujitec "corrected" the record, saying the articles (FT and others, presumably) contained "inaccuracies", including that "Fujitec is working to find a buyer."
They mention they have received a preliminary and non-binding initial proposal. The stock continued higher after that. Now investors have to decide how attractive an elevator/escalator business really is.


Director | Exposing Creative Accounting, Bucephalus Research Partnership

Robert Medd

Director | Exposing Creative Accounting

Exposing Creative Accounting

Bucephalus Research Partnership

Bucephalus Research Partnership Limited. Exposing Creative Accounting.

At the Bucephalus Research Partnership (BRP) we analyse financial statements using our accountant's practical experience and our own quantitative algorithms for corporate governance, accounting risk and peer performance.

Our thematic research refines our unique algorithms while our single stock research focuses on examples where we discover a significant gap between published accounts and business reality.

​Bucephalus Research Partnership:
- Is an independent fee-based research service
- Does not take proprietary positions, long or short
- Does not solicit business or fees from the corporates we review

Forensic Accounting

<p>The spectacular sale of Elevators has transformed TKA’s balance sheet and the performance problems are finally being addressed. The cash from the sale will more than cover COVID losses, the restructuring and restore TKA to health. A management prioritising productivity and margin over revenue should transform both P&amp;L and cashflow. We estimated 16-19,000 job cuts, but with the new plan, 23,000 jobs and E6bn of revenue will be off-loaded. The supervisory board has a poor track record, but the shareholder appointees have been renewed so they may deliver. Investors can buy cash at a discount with a free option on a turnaround. On 2.5x EV/fEBITDA, it is time to BUY:</p>

The spectacular sale of Elevators has transformed TKA’s balance sheet and the performance problems are finally being addressed. The cash from the sale will more than cover COVID losses, the restructuring and restore TKA to health. A management prioritising productivity and margin over revenue should transform both P&amp;L and cashflow. We estimated 16-19,000 job cuts, but with the new plan, 23,000 jobs and E6bn of revenue will be off-loaded. The supervisory board has a poor track record, but the shareholder appointees have been renewed so they may deliver. Investors can buy cash at a discount with a free option on a turnaround. On 2.5x EV/fEBITDA, it is time to BUY:

Germany

ThyssenKrupp AG manufactures industrial components.  The Company produces flat rolled and cast steel, automobile parts, elevators and escalators, machine tools, bearings, nonferrous metals and plastics, develops and manages real estate, and designs and constructs factories.

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ThyssenKrupp AG (TKA GR)

Naveen Jindal’s Bid for Thyssenkrupp Steel Europe – Sensible Valuation, Execution Critical

Despite past negative precedents, strong promoters and undemanding valuation make funding not a hurdle for entry at US$440-475/t. Success hinges...

Rahul Jain

Thyssenkrupp Is Reshaping Its Steel Future With 11,000 Job Cuts; What’s The Expected Margin Impact?

The company is undergoing significant transformation, focusing on becoming a strategic holding entity with independently managed business segments.

Baptista Research

ThyssenKrupp - Hidden Value in Elevator Business—A Game Changer?

hyssenKrupp's recent earnings call highlighted both challenges and opportunities as the company maneuvers through a tough market environment.

Baptista Research

Fujitec (6406 JP) - On the Block?

Fujitec may be on the block. An FT article suggests the company is talking to PE firms (wholly unsurprising) and the firm's "clarification" says a...

Travis Lundy

Thyssenkrupp: Turnaround Underway

The spectacular sale of Elevators has transformed TKA’s balance sheet and the performance problems are finally being addressed. The cash from the...

Bucephalus Research Partnership

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Naveen Jindal’s Bid for Thyssenkrupp Steel Europe – Sensible Valuation, Execution Critical

​Despite past negative precedents, strong promoters and undemanding valuation make funding not a hurdle for entry at US$440-475/t. Success hinges...

Rahul Jain

Thyssenkrupp Is Reshaping Its Steel Future With 11,000 Job Cuts; What’s The Expected Margin Impact?

The company is undergoing significant transformation, focusing on becoming a strategic holding entity with independently managed business segments.

Baptista Research

ThyssenKrupp - Hidden Value in Elevator Business—A Game Changer?

hyssenKrupp's recent earnings call highlighted both challenges and opportunities as the company maneuvers through a tough market environment.

Baptista Research

Fujitec (6406 JP) - On the Block?

Fujitec may be on the block. An FT article suggests the company is talking to PE firms (wholly unsurprising) and the firm's "clarification" says a...

Travis Lundy

Thyssenkrupp: Turnaround Underway

The spectacular sale of Elevators has transformed TKA’s balance sheet and the performance problems are finally being addressed. The cash from the...

Bucephalus Research Partnership

Despite past negative precedents, strong promoters and undemanding valuation make funding not a hurdle for entry at US$440-475/t. Success hinges...