In today’s briefing:
- SELL Pop Mart (9992 HK): Assessment of Short Pre 1H26 Results
- Groww: Can Margin Trading Become The Next Growth Engine?
- PowerGrid (PGCIL): Recovery on the Way
- Embassy Office: Steady Q1FY27; GCC Leasing, and Hotel Ramp Up Keep the Double-Digit DPU Story Intact
- Rio Tinto (RIO AU) Vs BHP (BHP AU): Pair Trade Opportunity as Ratio Breaches Two Sigma
- Milky Mist Dairy Food (1231D IN): Synthetic Expert Call Transcript (19 Aug 2026)
- Why Alibaba’s Lingxi Games Acquisition Is Drawing Attention!
- Morning Market Notes: Energy Equities Now Discounting Crude Oil Price Duration Vs. Price Level
- Shin-Etsu Chemical (4063 JP): Japan’s Best Wafer Asset, Priced as a Chemicals Stock
- ON Semiconductor Is Not Just An Auto Chip Play — NVIDIA MGX & AWS Change The Story!
SELL Pop Mart (9992 HK): Assessment of Short Pre 1H26 Results
- Consensus. The Street reset its numbers after the March results and the May update, then stopped while July channel data weakened. We think a second reset is ahead.
- Positioning. July’s bounce is accompied by short covering. Southbound has been a seller since June and the company’s buyback has been idle since April.
- Guidance risk. Management has lowered the bar twice this year. We expect the results call to lower the growth tone again.
Groww: Can Margin Trading Become The Next Growth Engine?
- Groww has rapidly scaled its Margin Trading Facility (MTF) business, creating a new interest-income opportunity beyond traditional broking revenue.
- MTF can improve customer monetisation, increase wallet share and create a more recurring revenue stream for discount brokers.
- If Groww achieves meaningful MTF penetration similar to established players, the business model could shift from transaction-led to platform-led financial services.
PowerGrid (PGCIL): Recovery on the Way
- Power Grid has work-in-hand of ~5x FY27 capex guidance, while 1QFY27 showed a clear improvement in execution through stronger capitalisation and continued TBCB wins.
- India’s transmission opportunity remains structurally strong, and we believe Power Grid is entering an operational recovery phase. The key catalyst is sustained project execution and monetisation through 2027e.
- We value Power Grid at 3.5x FY28E P/B, implying 60%+ upside over a medium-term horizon, largely driven by re-rating as execution and tariff conversion become more visible.
Embassy Office: Steady Q1FY27; GCC Leasing, and Hotel Ramp Up Keep the Double-Digit DPU Story Intact
- Revenue and NOI rose 17% YOY and DPU 9%. Q1 DPU was affected by property tax timing, while management reiterated double-digit FY27 DPU growth
- Leasing remains strong. 1.3 msf signed at 10% spreads and an 8% market premium, with GCCs driving 81% of leasing and AI-linked sectors 21% of new demand.
- Growth is supported by rent escalations, pre-leased developments and hotel ramp up. Key risks are refinancing needs, weak Pune occupancy and the Four Seasons transition.
Rio Tinto (RIO AU) Vs BHP (BHP AU): Pair Trade Opportunity as Ratio Breaches Two Sigma
- Context: The BHP (BHP AU) vs. Rio Tinto (RIO AU) price ratio has deviated more than two standard deviations from its one-year average, presenting a potential relative value opportunity.
- Highlight: Going long Rio Tinto (RIO AU) and short BHP (BHP AU) targets a 4% return.
- Why Read: Essential for quantitative traders seeking mean-reversion opportunities, with detailed execution framework, risk management protocols, and historical simulation showing the statistical basis for this relative value play.
Milky Mist Dairy Food (1231D IN): Synthetic Expert Call Transcript (19 Aug 2026)
- Premium Valuation vs. Asset-Heavy Reality: Following its listing on August 18, 2026, at ₹181.50 (a 29.61% premium over the ₹140 issue price), Milky Mist is valued at ₹13,972.66 crore (~$1.46 billion). This 85x price-to-earnings multiple matches premium packaged-food FMCG players, but ignores the company’s asset-heavy, highly leveraged, and low Return on Capital Employed (11.73% in FY26) model.
- The Cold-Chain Distribution Moat: Milky Mist’s primary defense against cooperative giants like Amul is its network of 41,459 owned visi-coolers placed in retail stores. This capital-intensive strategy secures exclusive shelf space and drives a 19% national organized paneer market share, but severely depresses free cash flows and asset turnover compared to asset-light peers like Dodla Dairy.
- Concentration Risk and High Financial Leverage: Despite using ₹496.86 crore of its IPO proceeds to deleverage—bringing debt-to-equity down from 3.61x toward a target of under 1.4x by FY27—Milky Mist is concentrating ₹469.24 crore of new capital expenditure back into its single manufacturing facility in Perundurai, Tamil Nadu. Its high-profile national expansion remains high-risk and freight-heavy until its proposed Baramati, Maharashtra plant is operational.
Disclaimer: The following transcripts are synthetic, AI-generated on demand, and compiled exclusively from public data sources; no real-word experts were actually interviewed. This content is designed to highlight potential market mispricings, explore compelling lines of inquiry, and suggest strategic questions rather than present verified facts. All specific financial metrics and data points, including market shares, TAM, margins, and growth rates, are AI-estimated approximations. They may be inaccurate and must be independently verified.
Why Alibaba’s Lingxi Games Acquisition Is Drawing Attention!
- Alibaba Group Holding Limited is advancing another major portfolio simplification as its Lingxi Games business moves toward new ownership under Asian private-equity firm Trustar Capital.
- The latest development goes beyond preliminary acquisition interest: Alibaba has reached an agreement to sell Lingxi Games, with reports indicating a valuation of more than $1.5 billion, although the final consideration has not been publicly disclosed.
- Lingxi Chief Executive Zhou Bingshu described the transaction as part of Alibaba’s broader effort to sharpen its strategic focus, while the company continues directing more capital toward artificial intelligence, cloud infrastructure, e-commerce and consumption.
Morning Market Notes: Energy Equities Now Discounting Crude Oil Price Duration Vs. Price Level
- As we expected, there continues to be absolutely no sign that the current U.S.-Iran stalemate will end anytime soon.
- In terms of our energy equity universe, it appears that portfolio managers are now embracing oil price “duration” versus price level, consistent with our “indefinite stalemate” scenario.
- We would not “chase” our stocks here, however, and we are looking for opportunities to begin trimming equity length in our model portfolio versus hedging with the commodity.
Shin-Etsu Chemical (4063 JP): Japan’s Best Wafer Asset, Priced as a Chemicals Stock
- The best ROIC in the wafer group (14.5%) does not trade at the best multiple — the PVC business imposes a conglomerate discount; the silicon recovery removes the justification.
- FY2025’s 14.4% profit fall was two independent cycle troughs — Asian PVC and wafer destocking — arriving simultaneously; Q1 FY2026 confirmed both are passing, management calls supply constrained.
- Initiating BULLISH, fair value ¥7,300 (11.5x FY2027E EBITDA); 14.4% capital upside plus 2.0% yield; 23 October H1 result is the catalyst to quantify the Electronics Materials recovery.
ON Semiconductor Is Not Just An Auto Chip Play — NVIDIA MGX & AWS Change The Story!
- Onsemi’s second quarter results for 2026 illustrate ongoing progress in its strategic reshaping and portfolio repositioning, with revenue reaching $1.6 billion—a 9% increase year-over-year—and non-GAAP diluted earnings per share of $0.74, both above midpoint guidance.
- The company reported a non-GAAP gross margin of 39.3%, marking the fourth consecutive quarter of margin expansion, driven by improved manufacturing performance, favorable product mix, and operating leverage amid recovering demand across multiple markets.
- A key highlight is the continued strength and rapid growth of the AI data center segment, expected to more than double revenue in 2026.
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