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.

Equity Bottom-Up

<ul><li>Vale's Q2 2024 earnings reflected a mixture of operational accomplishments and ongoing challenges.</li><li>A significant positive was the advancement in safety measures, particularly the decharacterization of the B3/B4 dam, which was completed one year ahead of schedule.</li><li>This achievement is part of Vale's broader commitment to eliminate all upstream dams in Brazil, enhancing safety standards.</li></ul>

Vale's Q2 2024 earnings reflected a mixture of operational accomplishments and ongoing challenges.A significant positive was the advancement in safety measures, particularly the decharacterization of the B3/B4 dam, which was completed one year ahead of schedule.This achievement is part of Vale's broader commitment to eliminate all upstream dams in Brazil, enhancing safety standards.

Vale S.A.: Enhanced Production Capacity Through Strategic Asset Expansion & Other Major Drivers

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

<ul>
<li>Iron ore broke out of its three-year band two weeks ago and, after a brief recovery, trended lower by 9% WoW. It is now within touching distance of 90 USD/ton. </li>
<li>Chinese steel margins showed no signs of improving, with the average mills losing 70-80 USD/ton. Iron ore inventories continued to climb at the ports, exceeding 150 million tons.</li>
<li>We would stay clear of iron ore names for the time being as we wait for iron ore to consolidate at some levels. </li>
</ul>


Iron ore broke out of its three-year band two weeks ago and, after a brief recovery, trended lower by 9% WoW. It is now within touching distance of 90 USD/ton. 
Chinese steel margins showed no signs of improving, with the average mills losing 70-80 USD/ton. Iron ore inventories continued to climb at the ports, exceeding 150 million tons.
We would stay clear of iron ore names for the time being as we wait for iron ore to consolidate at some levels. 


Iron Ore Tracker (9-Sep-2024): Short-Term Bearish Signals More Prominent

<ul>
<li>Iron ore found no support at the 95-100 USD/ton range for the first time in a while and broke through it, gapping down 8.8% WoW to 92 USD/ton.</li>
<li>This break is a major short-term bearish signal for iron ore prices, as market participants would lose confidence in the theory of cost support at 95-100 USD/ton. </li>
<li>TSF data and mill margins ( -575 RMB/ton) from China also do not inspire much confidence in the near-term outlook for iron ore. </li>
</ul>


Iron ore found no support at the 95-100 USD/ton range for the first time in a while and broke through it, gapping down 8.8% WoW to 92 USD/ton.
This break is a major short-term bearish signal for iron ore prices, as market participants would lose confidence in the theory of cost support at 95-100 USD/ton. 
TSF data and mill margins ( -575 RMB/ton) from China also do not inspire much confidence in the near-term outlook for iron ore. 


Iron Ore Tracker (19-Aug-2024): Major Testing Point of 95 USD/Ton, Broken For Iron Ore

<ul>
<li>Iron ore has remained rangebound between 95 and 130 USD/ton for three years, with cost-curve support kicking in on the higher cost curve at around 100 USD/ton.</li>
<li>Last week, quarterly operational updates released were for <a href="https://api.mziq.com/mzfilemanager/v2/d/53207d1c-63b4-48f1-96b7-19869fae19fe/7d5a19cc-4fa7-7ce9-a947-44dcefea9f27?origin=1" target="_blank" rel="noopener">Vale</a>, <a href="https://www.bhp.com/-/media/documents/media/reports-and-presentations/2024/240717_bhpoperationalreviewfortheyearended30june2024.pdf" target="_blank" rel="noopener">BHP</a>, <a href="https://www.angloamericankumba.com/~/media/Files/A/Anglo-American-Group-v5/Kumba/press-releases/2024/q2-2024-production-and-sales-report.pdf" target="_blank" rel="noopener">Kumba</a>, and <a href="https://www.mtgibsoniron.com.au/wp-content/uploads/2024/07/MGX-June-Quarter-2024-Activities-Report-Final.pdf" target="_blank" rel="noopener">Mount Gibson.</a> Except for BHP, all companies were disappointed due to provisional pricing impacts and mix changes.</li>
<li>Read our recent production preview <a href="https://www.smartkarma.com/insights/fortescue-metals-group-fmg-au-high-dividend-yield-of-9-what-to-expect-from-q4-fy24" target="_blank" data-smartkarma-citation="insights:151567" rel="noopener">Fortescue Metals Group (FMG AU): High Dividend Yield of 9%, What to Expect From Q4 FY24,</a> to be declared on the 25th of July. </li>
</ul>


Iron ore has remained rangebound between 95 and 130 USD/ton for three years, with cost-curve support kicking in on the higher cost curve at around 100 USD/ton.
Last week, quarterly operational updates released were for Vale, BHP, Kumba, and Mount Gibson. Except for BHP, all companies were disappointed due to provisional pricing impacts and mix changes.
Read our recent production preview Fortescue Metals Group (FMG AU): High Dividend Yield of 9%, What to Expect From Q4 FY24, to be declared on the 25th of July. 


Iron Ore Tracker July 22nd, 2024: Doing The Dance Between 95-130 USD/Ton, Use Iron Condors

<ul>
<li>Iron ore has remained rangebound between 95 and 130 USD/ton for three years, with cost-curve support kicking in on the higher end of the cost curve at around 100 USD/ton. </li>
<li>Coking coal prices are expected to bounce due to the Anglo incident, and we believe the 65-62 spread will benefit, moving out of its mid-teens band. </li>
<li>We like iron condors (set up details in the insight) and high-grade ore producers <a href="https://www.smartkarma.com/entities/rio-tinto-ltd" target="_blank" data-smartkarma-citation="entities:13:1" rel="noopener">Rio Tinto Ltd (RIO AU)</a>, <a href="https://www.smartkarma.com/entities/vale-sa" target="_blank" data-smartkarma-citation="entities:23731:1" rel="noopener">Vale (VALE US)</a>.</li>
</ul>


Iron ore has remained rangebound between 95 and 130 USD/ton for three years, with cost-curve support kicking in on the higher end of the cost curve at around 100 USD/ton. 
Coking coal prices are expected to bounce due to the Anglo incident, and we believe the 65-62 spread will benefit, moving out of its mid-teens band. 
We like iron condors (set up details in the insight) and high-grade ore producers Rio Tinto Ltd (RIO AU), Vale (VALE US).


Iron Ore Tracker July 4th, 2024: Prices Rangebound, Iron Condors Anyone?

Brazil

Vale S.A. is a Brazilian multinational corporation primarily engaged in metals and mining. The company is one of the world's largest producers of iron ore and nickel, also extracting copper, manganese, and ferroalloys, along with operating extensive logistics infrastructure. Vale S.A. was founded on June 1, 1942, and is headquartered in Rio de Janeiro, Brazil.

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Vale (VALE US)

Vale S.A.: Enhanced Production Capacity Through Strategic Asset Expansion & Other Major Drivers

Vale's Q2 2024 earnings reflected a mixture of operational accomplishments and ongoing challenges. A significant positive was the advancement in...

Baptista Research

Iron Ore Tracker (9-Sep-2024): Short-Term Bearish Signals More Prominent

With iron ore prices breaking below 95 USD/ton, we become more bearish in the short term. We track indicators like mill margins, inventories, and...

Sameer Taneja

Iron Ore Tracker (19-Aug-2024): Major Testing Point of 95 USD/Ton, Broken For Iron Ore

Iron ore broke out of its 95-130 USD/ton level and is now 92 USD/ton. The short-term outlook looks bad as at this level confidence is broken in the...

Sameer Taneja

Iron Ore Tracker July 22nd, 2024: Doing The Dance Between 95-130 USD/Ton, Use Iron Condors

With iron ore continuing to remain rangebound between 95-130 USD/ton for the last 3 years (with minor overshoots), we summarize actionable ideas in...

Sameer Taneja

Iron Ore Tracker July 4th, 2024: Prices Rangebound, Iron Condors Anyone?

With the latest 10% bounce in iron ore prices and coking coal prices, we provide actionable ideas to play iron ore in equities/options etc.

Sameer Taneja

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