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Smartkarma Daily Briefs

Sep 11
0

Daily Brief Industrials: Rubber, National Infrastructure Trust, Cosco Shipping Energy Transportation Co. Ltd. (H) and more

By | Daily Briefs, Industrials

In today’s briefing:

  • [Rubber, China, Futures] Typhoon Triggered Defaults Nudged Rubber Spot Prices and SHFE Futures Up
  • National Infrastructure Trust Pre-IPO Tearsheet
  • Cosco Shipping Energy Transportation – Capitulation in Oil and Related Equities Almost Complete?

[Rubber, China, Futures] Typhoon Triggered Defaults Nudged Rubber Spot Prices and SHFE Futures Up

By Farah Miller

  • Physical rubber prices gained strength during the Asian trade day as a typhoon in Vietnam disrupted the supply chain, limiting supply in the market. 
  • In addition, increased inquiries from the Chinese tire makers for the prompt cargoes resulted in further support for the prices. 
  • Chinese state buying up to 100kt of rubber, prices to be announced on 13 Sep 2024. This would provide some short term support on the SHFE 

National Infrastructure Trust Pre-IPO Tearsheet

By Akshat Shah

  • National Infrastructure Trust (NIT IN) is looking to raise about US$190m in its upcoming India IPO. The deal will be run by SBI Caps and HDFC Bank.
  • National Infrastructure Trust is an infrastructure investment trust established to acquire, manage and invest in a portfolio of infrastructure assets in India.
  • Its initial asset portfolio will consist of nine road assets, in the states of Haryana, Rajasthan, Bihar, Uttarakhand, Himachal Pradesh, Madhya Pradesh and Karnataka with an aggregate length of ~683.875km.

Cosco Shipping Energy Transportation – Capitulation in Oil and Related Equities Almost Complete?

By Rikki Malik

  • Speculative liquidation of crude oil positions opens up an opportunity
  • A seasonally strong period for crude tanker rates coming up
  • Company option scheme for senior management approved. Strike above current price

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Sep 11
0

Daily Brief TMT/Internet: KT Corp, CELSYS, PC Partner, Nextdc Ltd, Taiwan Semiconductor (TSMC) – ADR, Palantir Technologies , NORBIT ASA, Kyndryl Holdings , CYND and more

By | Daily Briefs, TMT/Internet

In today’s briefing:

  • Timing a Trade to Capitalize on KT’s November Global Index Deletion and the ETF Recall
  • TOPIX Inclusions: Who Is Ready (September 2024)
  • PC Partner (1263 HK): Goodbye Hong Kong; Hello Singapore
  • NEXTDC Placement – Good Track Record but Seems Opportunistic
  • Taiwan Dual-Listings Monitor: TSMC 33% Growth, UMC Headroom Decrease, ASE Historically Low Premium
  • S&P 500/400/600 Changes – DELL, PLTR, and ERIE Added, AAL, ETSY, BIO Deleted
  • Portfolio Update: August 2024
  • Tech Supply Chain Tracker (11-Sep-2024): Global smartphones, 2Q ’24
  • Taiwan Tech Weekly: TSMC Becoming More Dominant; Apple’s AI Opportunity; Taiwan Market Hammered
  • Cynd (4256) – Tuesday, Jun 11, 2024

Timing a Trade to Capitalize on KT’s November Global Index Deletion and the ETF Recall

By Sanghyun Park

  • KT’s foreign room is likely staying below 3.75% for November, setting up an ETF recall play. We’ve seen short-term buying pressure in similar past index reshuffles.
  • The ETF recall impact peaks right after the announcement. KT’s May downweight saw a 5% spike in two trading days post-announcement.
  • KT’s price moves more with downweights than SK Telecom’s because of higher overseas borrowing demand. This trend should hold, so setting up a position before the November announcement makes sense.

TOPIX Inclusions: Who Is Ready (September 2024)

By Janaghan Jeyakumar, CFA

PC Partner (1263 HK): Goodbye Hong Kong; Hello Singapore

By David Blennerhassett

  • On the 18th June, personal computer parts and accessories play PC Partner (1263 HK) (PCP) announced a SGX listing was under consideration; and a possible withdrawal of the HKEx listing.
  • PCP’s 30th August announcement provided clarity on a step-by-step approach for the HKEx withdrawal. I recently held zooms with the SFC and SGX for added clarification.
  • PCP’s exchange relocation is predicated on PCP’s operational expansion into new markets, in particular, Southeast Asia. How and when the SGX becomes the preferred trading exchange  remains an unanswered question. 

NEXTDC Placement – Good Track Record but Seems Opportunistic

By Sumeet Singh

  • Nextdc Ltd (NXT AU) aims to raise around US$366m via a fully underwritten institutional placement, along with another US$133m via a non-underwritten SPP.
  • The company has undertaken a number of deals in the past, most of which have done ok. Although this one appears to be a bit opportunistic.
  • In this note, we will talk about the deal dynamics and run the deal through our ECM framework.

Taiwan Dual-Listings Monitor: TSMC 33% Growth, UMC Headroom Decrease, ASE Historically Low Premium

By Vincent Fernando, CFA

  • TSMC: +15.9% Premium; Sales Rose 33% YoY in August & Headroom Increased
  • UMC: +1.8% Premium; Largest Monthly Decrease in ADR Headroom, Has Consistently Been Decreasing Since May
  • ASE: +2.0% Premium; At Current Level Can Consider Going Long the Premium

S&P 500/400/600 Changes – DELL, PLTR, and ERIE Added, AAL, ETSY, BIO Deleted

By Travis Lundy

  • Last Friday, the S&P Index Committee announced the changes to the S&P500, S&P400, S&P600, and other indices, along with the result of a recent consultation on capping methodology.
  • The result is about US$23bn a side of flows for the major indices
  • In the S&P500, DELL, PLTR, and ERIE are ADDs. AAL, ETSY, and BIO are DELETEs. But as always, just knowing the names is deceptive. The history matters more.

Portfolio Update: August 2024

By Contrarian Cashflows

  • Welcome back to the portfolio updates series! This month, I enjoyed a long vacation with my family, spending three weeks traveling through Italy by car.
  • We began our journey from our home near Munich, which allowed us to traverse the entire country from north to south and back again.
  • We entered Italy through South Tyrol and drove down to Tuscany, where we spent a week. Afterward, we continued our journey all the way down to Puglia, where we stayed for ten days before making the return trip.

Tech Supply Chain Tracker (11-Sep-2024): Global smartphones, 2Q ’24

By Tech Supply Chain Tracker

  • Global smartphone sales are anticipated to rise in Q2 2024, presenting an opportunity for Taiwanese firms to act quickly.
  • IBM’s Kyndryl spinoff is focusing on addressing India’s cybersecurity talent shortage, signaling the need for immediate action.
  • Apple is prioritizing user privacy in its slow launch strategy, while Huawei revolutionizes mobile innovation with a triple-fold smartphone.

Taiwan Tech Weekly: TSMC Becoming More Dominant; Apple’s AI Opportunity; Taiwan Market Hammered

By Vincent Fernando, CFA

  • TSMC Extends Global Foundry Dominance Amid 33% Sales Surge – A Buy on Weakness Despite Market Concerns
  • Apple ‘Glowtime’ AI Announcements: Mixed Analyst and Media Reactions May Overlook Key Advantage — Apple Is Best Positioned to Seamlessly Integrate AI Into Your Smartphone Experience
  • Taiwan Market Gainers & Losers: Consumer Electronics & Memory Names Some of the Hardest Hit

Cynd (4256) – Tuesday, Jun 11, 2024

By Value Investors Club

  • CYND Co., Ltd. is a dominant player in the reservation management software for beauty salons in Japan, with 90% of its revenue coming from recurring contracts
  • The company has high barriers to scale and has acquired its second largest competitor, effectively eliminating competition
  • CYND has the potential to significantly increase its revenue over the next decade, led by its co-founders with strong insider ownership, and is currently valued at JPY 4.1bn with a projected net 10-year IRR of 24.1% for Sun Mountain.

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

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Sep 11
0

Daily Brief Consumer: Seven & I Holdings, Midea Group Co Ltd A, Joban Kosan, LG Electronics, Descente Ltd, NIO , TSE Tokyo Price Index TOPIX, China Tourism Group Duty Free and more

By | Consumer, Daily Briefs

In today’s briefing:

  • Seven & I Holdings (3382 JP): State of Play
  • Midea Group HK IPO Valuation Analysis
  • Joban Kosan (9675) – Fortress Buys Out a Fukushima Tourism Asset
  • LG Electronics India IPO: Potential Big Gains. Booming Demand, Buoyant Valuations
  • Itochu’s Big Plans for Descente – Shame Investors Won’t Get a Look In
  • Midea HK Listing: Valuation Insights
  • [NIO Inc. (NIO US, SELL, TP US$1) Target Price Change]: Who Is Going to Give in a Slowing EV Market?
  • Disclosure Is Important, but Walk the Talk Is More Important
  • CTG Duty Free (1880 HK): Where Is the End of the Tunnel?

Seven & I Holdings (3382 JP): State of Play

By Arun George

  • Despite Seven & I Holdings (3382 JP)‘s rejection, Alimentation Couche-Tard (ATD CN) remains prepared to enter collaborative and friendly discussions to focus on finding greater value for 7&i shareholders. 
  • Couche-Tard’s options are to return with a revised offer, go hostile or walk away. Couche-Tard will likely test the Board’s resolve by returning with a higher offer.
  • The Board’s options are to go through the motions (appointing IFAs), conduct a market check or launch a more aggressive action plan to placate restive shareholders. 

Midea Group HK IPO Valuation Analysis

By Douglas Kim

  • We would subscribe to the HK offering of Midea Group due to its attractive valuations, strong fundamentals, and meaningful price discount relative to the A shares. 
  • We believe a premium valuation relative to the comps is appropriate for Midea Group due to its higher sales growth, EBIT margin, and ROE.
  • Pricing of this offering is expected to be completed on 13 September and listing on 17 September. 

Joban Kosan (9675) – Fortress Buys Out a Fukushima Tourism Asset

By Travis Lundy

  • In the annals of foreign buyers of Japanese tourism-related real estate assets, there have been a few good examples, and several disasters. Yesterday, we got a new suitor for assets. 
  • Fortress SPV Ontario GK will attempt to buy out Fukushima-based Joban Kosan (9675 JP) through a double Tender Offer. 
  • There is a history here of a bump on an MBO on an associated company. That may have caused it to trade at a premium on Day 1. It’s unrelated.

LG Electronics India IPO: Potential Big Gains. Booming Demand, Buoyant Valuations

By Devi Subhakesan

  • LG Electronics’s India business IPO could be valued above USD 7 billion, exceeding market expectations, driven by its dominant position in India’s growing home appliances market and strong sector valuations.
  • Favourable market conditions and robust sector growth make now an ideal time for LG Electronics (066570 KS) to launch its India IPO, securing high investor interest and compelling valuations.
  • In a recent interview, LG Electronics(066570 KS)  CEO William Cho mentioned that an Indian market debut is one of several options being considered to revitalise the company’s consumer electronics business.

Itochu’s Big Plans for Descente – Shame Investors Won’t Get a Look In

By Michael Causton

  • Itochu’s Textile division continues to execute the directive from its CEO to expand reach and coverage in the fashion and lifestyle sectors, with sports one of the major target categories.
  • It will completely absorb Descente as part of this plan, meaning the brand is likely to become one of the largest in the portfolio.
  • The ongoing tender offer will likely succeed giving Itochu a bargain and investors no stake in the future.

Midea HK Listing: Valuation Insights

By Shifara Samsudeen, ACMA, CGMA

  • Chinese home appliance maker Midea has announced the terms for its IPO. The company plans to raise $3.46bn at an indicative price range of HK$52.0-54.8 per share.
  • The company has a diversified product portfolio, well-balanced exposure to domestic as well as overseas markets and a growing robotics business.
  • As we expected, the HK offering is priced at around 25% discount to it’s A-shares and our analysis suggests that Midea’s HK offering is priced attractively. 

[NIO Inc. (NIO US, SELL, TP US$1) Target Price Change]: Who Is Going to Give in a Slowing EV Market?

By Eric Wen

  • NIO Motors (NIO) reported C2Q24 top line, non-GAAP operating loss and GAAP net loss in-line, narrower and narrower vs. our estimate, and in-line, narrower and in-line vs. consensus. 
  • The brightest spot of the result is gross margin due to both vehicle and service gross margin improvements. 
  • We keep rating at SELL and raise TP to US$1 to reflect better OPEX control.

Disclosure Is Important, but Walk the Talk Is More Important

By Aki Matsumoto

  • If a company seeks immediate effects to improve capital profitability, it’ll return cash to shareholders because it’ll be years before the company can recoup it by making more investments now.
  • Even companies that have increased valuations by raising their capital profitability can improve it by reducing their cash on hand and policy shareholdings, which are still too large.
  • Companies with low capital profitability and low valuations have to gain investor confidence through quarterly earnings disclosures by demonstrating that their disclosed goals are achievable.

CTG Duty Free (1880 HK): Where Is the End of the Tunnel?

By Osbert Tang, CFA

  • Market consensus is unrealistic as it expects China Tourism Group Duty Free (1880 HK) to record 32.1% YoY and 14.6% HoH earnings growth in 2H24. More downgrade risk ahead.
  • Average per-customer duty-free sales in Hainan dropped by 19.2% YoY in Jul, indicating the negative wealth effect and deteriorating middle-class spending appetite.
  • Overseas duty-free sales to Chinese residents surged by almost 50% YoY in Aug, implying a diversion effect which is also detrimental. 

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Sep 11
0

Daily Brief Health Care: Krsnaa Diagnostics, Bicara Therapeutics, Akeso Biopharma Inc, Arrowhead Pharmaceuticals and more

By | Daily Briefs, Healthcare

In today’s briefing:

  • The Beat Ideas- Krsnaa Diagnostics: B2C & Asset Light Flavor
  • Key Updates on Bicara Therapeutics IPO: ~$800M Valuation at the Midpoint and Strong Balance Sheet
  • Akeso Biopharma Inc (9926 HK) – Something Beautiful Is Happening
  • ARWR: PALISADE Phase 3 Results Published in NEJM

The Beat Ideas- Krsnaa Diagnostics: B2C & Asset Light Flavor

By Sudarshan Bhandari

  • Krsnaa Diagnostics (KRSNAA IN) expands into B2C, adds new pathology labs, and secures major government contracts for further growth.
  • Growth in PPP and retail sectors, improved margins, and expanding service offerings solidify market leadership.
  • Krsnaa’s aggressive expansion strategy and diversification indicate strong long-term growth potential with new B2C trajectory and Asset Light Model Expansion.

Key Updates on Bicara Therapeutics IPO: ~$800M Valuation at the Midpoint and Strong Balance Sheet

By Andrei Zakharov

  • Bicara Therapeutics unveiled the terms of its IPO: a clinical-stage biotech company offers ~11.8M shares at the price range of $16.00-$18.00, implying a market cap of ~$800M at the midpoint.
  • Existing shareholders do not intend to sell shares in this offering and Bicara Therapeutics shares will list on the Nasdaq under the ticker symbol “BCAX”.
  • The biotech company is focused on patients with HPV-negative head and neck cancer, and I view Bicara’s IPO valuation as attractive, with major catalysts coming up in 2025.

Akeso Biopharma Inc (9926 HK) – Something Beautiful Is Happening

By Xinyao (Criss) Wang

  • AK112’s HARMONi-2 results were impressive, but there’s still critical data gap before obtaining approval from FDA. The main concern is whether good PFS can be translated into significant OS benefits.
  • Akeso will be eligible to receive low double-digit royalties on net sales from Summit. So, Summit is actually a better investment because it has complete global rights of AK112.
  • Investors are betting Summit to be acquired by MNCs at a high price.Due to anti-monopoly issue, the narrowing pool of potential buyers would increase the difficulty of Summit being acquired.

ARWR: PALISADE Phase 3 Results Published in NEJM

By Zacks Small Cap Research

  • On September 2, 2024, Arrowhead Pharmaceuticals, Inc. (ARWR) announced results from the Phase 3 PALISADE study of plozasiran in patients with familial chylomicronemia syndrome (FCS).
  • The trial met its primary endpoint and all key secondary endpoints, including statistically significant reductions in triglycerides (TGs), apolipoprotein C-III (APOC3), and the incidence of acute pancreatitis.
  • The data were presented in a late-breaking oral presentation at the European Society of Cardiolog (ESG) Congress 2024 and simultaneously published in The New England Journal of Medicine.

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Sep 11
0

Daily Brief Financials: Public Storage, Bitcoin, CIMB Group Holdings and more

By | Daily Briefs, Financials

In today’s briefing:

  • Upgrading Staples, Real Estate, and Health Care to Overweight; List of Concerns Continues to Grow
  • Crypto Crisp: September, Please Go Away
  • Malaysian Banks Screener; CIMB Improves Credit Quality Driving Post Provision Returns

Upgrading Staples, Real Estate, and Health Care to Overweight; List of Concerns Continues to Grow

By Joe Jasper

  • Our long-term outlook remains neutral on the S&P 500 (SPX) as of our 8/6/24 Compass, after being bullish since early-November 2023.
  • Since late-July discussed expectations for a 1-to 4-month pullback/consolidation on SPX and QQQ; now it’s likely to last closer to four months, and potentially 4- to 6-months from 7/17/24.
  • At that point the market will decide which way this consolidation resolves. Throughout this pullback we have said that this consolidation could end up being a significant topping pattern.

Crypto Crisp: September, Please Go Away

By Mads Eberhardt

  • Since the release of our Crypto Moves #42 on Friday, the market experienced further declines but has since regained some of its lost ground.
  • Our outlook remains unchanged: at best, the market will move sideways throughout September, and at worst, we may see further declines.
  • However, starting in October, the market will most likely show signs of life similar to those we saw in the early months of this year.

Malaysian Banks Screener; CIMB Improves Credit Quality Driving Post Provision Returns

By Victor Galliano

  • We reiterate our buy on CIMB; management continues to drive credit quality with cost of risk improvements, and we see potential for operating efficiency gains, combined with its attractive valuations 
  • We downgrade Maybank to a neutral from buy, largely on the back of valuations and its middle-of-the-peer-group pre- and post-provision return trends, with its efficiency ratio requiring attention 
  • We believe that AM Bank is a name to watch for its low valuations as well as its improving cost of risk trends and profitability returns

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Sep 10
0

Daily Brief Australia: Hotel Property Investments, Nanosonics Ltd, Kinatico , Amaero International Ltd and more

By | Australia, Daily Briefs

In today’s briefing:

  • Hotel Property (HPI AU) Rejects Charter Hall’s A$3.65/Share Offer
  • Nanosonics Ltd (NAN AU): Steering Back to Growth Trajectory; Outlook Is Improving
  • Kinatico Ltd – Recurring revenue streams top $21.7m in FY24
  • Amaero International Ltd – ADDMAN qualification of C103 powder a major milestone

Hotel Property (HPI AU) Rejects Charter Hall’s A$3.65/Share Offer

By David Blennerhassett

Nanosonics Ltd (NAN AU): Steering Back to Growth Trajectory; Outlook Is Improving

By Tina Banerjee

  • Nanosonics Ltd (NAN AU) reported significant turnaround, with recording H2FY24 revenue of A$90M, up 14% over the first half, driven by 20% increase in capital revenue in H2 over H1.
  • For FY25, Nanosonics guided for accelerated revenue growth of 8–12%, driven by growing capital revenue with greater unit volumes and increasing recurring revenue aligned with growth in installed base.
  • The company expects FY25 gross profit margin of 77–79% versus 77.9% in FY24, on higher production volumes in FY25 after reducing inventory in FY24.

Kinatico Ltd – Recurring revenue streams top $21.7m in FY24

By Research as a Service (RaaS)

  • RaaS has published an update report on ‘Know Your People’ regtech company, Kinatico (ASX:KYP) following its 5 September webinar in which it highlighted for the first time the annual recurring revenue being generated across the group.
  • Total ARR for the group was 76% of revenue or $21.7m, comprising $12m in transactional ARR and $9.7m in SaaS revenue.
  • • Kinatico is targeting 80% of its revenues from SaaS (currently 34%) within three years, which is well ahead of our forecasts for 60% by FY27.

Amaero International Ltd – ADDMAN qualification of C103 powder a major milestone

By Research as a Service (RaaS)

  • RaaS has published an update report on advanced materials manufacturing group Amaero International (ASX:3DA) following its announcement that it has completed qualification of C103 additive manufacturing powder with US advanced manufacturing conglomerate ADDMAN Group more than a quarter ahead of schedule.
  • Amaero notes that expected future sales from this relationship are material to its revenue and is a key assumption underpinning Amaero’s guidance that it will achieve EBITDA break-even in FY26.
  • Our FY26f EBITDA forecast of $0.1m assumes qualification is achieved.

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Sep 10
0

Daily Brief Event-Driven: Select Sector Indices: Inflows to Apple and more

By | Daily Briefs, Event-Driven

In today’s briefing:

  • Select Sector Indices: Inflows to Apple, Palantir, Dell Will Add to SPX Buying
  • Guotai Junan (2611 HK) & Haitong (6837 HK) Merger Creates China’s Major Player
  • 7&I Rejects ACT’s Bid As Too Low, Not Worth Discussing, ACT Whines, 7&I Taps The Sign
  • Midea Group: Quick Overview of HK Offer, Post-Issue Valuations. Attractive.
  • Hotel Property (HPI AU) Rejects Charter Hall’s A$3.65/Share Offer
  • SENSEX Index Rebalance Preview: Trent Could Replace Bajaj Finserv; BUT F&O Adds Could Change That
  • Shanghai Henlius Biotech (2696.HK) Privatization Update – Some New Information Worth the Attention
  • Midea Real Estate (3990 HK): Now Trading Ex-In-Specie
  • EQD | The NIFTY Potential Upside From Here

Select Sector Indices: Inflows to Apple, Palantir, Dell Will Add to SPX Buying

By Brian Freitas

Guotai Junan (2611 HK) & Haitong (6837 HK) Merger Creates China’s Major Player

By David Blennerhassett

  • Guotai Junan Securities (2611 HK) and Haitong Securities Co Ltd (H) (6837 HK), two of China’s leading state-backed brokerages, intend to merger via a share swap, subject to regulatory approvals.
  • Via a Merger by Absorption. GJS will issue new A and H shares to Haitong shareholders. The ratio hasn’t been firmed. Upon completion, the MergeCo creates China’s largest securities entity.
  • A merger is welcome – possibly mandated – amid challenging capital markets and a tightening regulatory backdrop.

7&I Rejects ACT’s Bid As Too Low, Not Worth Discussing, ACT Whines, 7&I Taps The Sign

By Travis Lundy

  • Late last week, the Nikkei reported Seven & I Holdings (3382 JP) would send a letter to Couche-Tard saying they reviewed ACT’s Proposal and deemed it “inadequate.” Indeed it was.
  • 7&i then published the Board’s letter, saying 7&i remained open to discussions but ACT’s Offer “grossly undervalued” 7&i’s intrinsic value and lacked in other areas. ACT responded with a “letter.”
  • But ACT’s “letter” was a press release aimed not at 7&i but the public. 7&i released a terse response today. ACT is the suitor. It needs to act like it.

Midea Group: Quick Overview of HK Offer, Post-Issue Valuations. Attractive.

By Devi Subhakesan

  • Midea Group Co Ltd A (000333 CH)  is offering 492.1 million shares in Hong Kong, priced between HKD52 and HKD54.8 per share.The valuation looks attractive.
  • Nearly one-third of the Hong Kong share offering has already been subscribed by cornerstone investors.
  • Midea’s strong market share in home appliances, consistent revenue growth, margin expansion, and appealing return ratios make a compelling investment case.

Hotel Property (HPI AU) Rejects Charter Hall’s A$3.65/Share Offer

By David Blennerhassett

SENSEX Index Rebalance Preview: Trent Could Replace Bajaj Finserv; BUT F&O Adds Could Change That

By Brian Freitas

Shanghai Henlius Biotech (2696.HK) Privatization Update – Some New Information Worth the Attention

By Xinyao (Criss) Wang

  • Fosun Pharma will make every effort to promote the success of this privatization. The management has disclosed the afterwards arrangements- Henlius and Fosun Pharma will further expand/integrate in the future.
  • Henlius’ revenue is expected to reach RMB6 billion in 2024 and RMB8-9 billion in next 2-3 years. Even if the privatization fails, things are still manageable due to strong fundamentals.
  • Fosun Pharma will not stop its capital operation against Henlius, but the plans of re-listing could be based on a new entity. So, the Cash Alternative is a better choice. 

Midea Real Estate (3990 HK): Now Trading Ex-In-Specie

By David Blennerhassett

  • Back on the 23 June 2024, property developer Midea Real Estate Holding (3990 HK) announced the in-specie distribution of its core ops, either in unlisted scrip, or HK$5.90/share in cash.
  • The in-specie involved distributing 97.8% of Midea’s assets (involved in property development and sales); accounting for 95% of revenue and ~91% of profit. All figures as at FY23.
  • Midea went ex yesterday, closing down just HK$4.87/share. Midea, ex-in-specie, is currently trading at a trailing 0.6x P/B, and 2.3x PER. Pricing looks full.

EQD | The NIFTY Potential Upside From Here

By Nico Rosti

  • The NIFTY Index closed down last week, but if the rally restarts from here it would be good to analyse the pattern trend, to estimate how high it could go.
  • The current WEEKLY pattern favors uptrend that last for 2 or 3 weeks up in a row, on average, and up to 5 consecutive weeks up in a row.
  • Some additional reasoning is necessary to highlight the strongest resistance levels, we will do it in the insight.

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Sep 10
0

Daily Brief Thematic (Sector/Industry): The Stocks to Own in Asia – Vol. 46 and more

By | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

  • The Stocks to Own in Asia – Vol. 46
  • Ohayo Japan | Stocks Jump Ahead of Key Inflation Reports
  • China Banks – Losses at Developers, Notes to Financials at Some Banks, More Clear than Headlines
  • Japan Morning Connection: Tech Rebound Setting Positive Tone to Start
  • The Stocks to Own in ASEAN – Vol. 48
  • Online Game Monitor: August 13 – September 8, 2024

The Stocks to Own in Asia – Vol. 46

By Dr. Andrew Stotz, CFA

  • We highlight 14 stocks in Asia that look interesting to us based on our FVMR methodology
  • Portfolio changes: Two stock remains, 12 stocks added into portfolio
  • Since its inception, it has generated a before-fee total return of 168% versus the MSCI Asia ex Japan of 82%

Ohayo Japan | Stocks Jump Ahead of Key Inflation Reports

By Mark Chadwick

  • U.S. stocks surged Monday as investors bought the dip following Wall Street’s worst week of the year, anticipating a Federal Reserve rate cut later this month
  • Apple’s “Glowtime” event revealed the iPhone 16 lineup, AI-powered iOS 18 updates, and new hardware including AirPods 4 and Apple Watch Series 10
  • In August, Japanese investors set a record by purchasing 7.34 trillion yen ($51.3 billion) in foreign bonds, driven by a stronger yen

China Banks – Losses at Developers, Notes to Financials at Some Banks, More Clear than Headlines

By Daniel Tabbush

  • With many real estate developers in China reporting losses, and with greater clarity of their woes, there should be flow through to banks.
  • Generally, at the top line and in head line bad loans, this is simply not visible, so that one must look to notes to financial statements, other granular data.
  • Bank Of Communications Co H (3328 HK) shows restructured loans up from RMB41bn to RMB61bn in just six months, with many China banks showing far higher loss loans

Japan Morning Connection: Tech Rebound Setting Positive Tone to Start

By Andrew Jackson

  • Tech rebounds overnight led by AI related, although concerns weighing on China export names including ASML.
  • Oracle numbers beating after hours setting a positive tone for software as well as some SPE, with capex plans set to double YoY.
  • Nothing amazing from the Apple event likely to weigh on Japanese suppliers, although little expectation priced in. ARM and Softbank the big winners, with V9 chips running the new iPhones.

The Stocks to Own in ASEAN – Vol. 48

By Dr. Andrew Stotz, CFA

  • We highlight 14 stocks in ASEAN that look interesting to us based on our FVMR Methodology
  • Portfolio changes: Four stocks remain, 10 stocks added to our portfolio
  • Since its inception, the portfolio has generated a before-fee total return of 249% versus MSCI ASEAN’s 39%

Online Game Monitor: August 13 – September 8, 2024

By Stan Zhao

  • Tencent’s <Honor of Kings> has seen significant grossing growth following gameplay features’ expansion and global servers’ launch.
  • Additionally, <Teamfight Tactics Mobile> saw a surge in grossing rankings after its anniversary event and has since maintained a stable position.
  • <Justice Mobile> has stabilized following its anniversary update, while <Naraka Mobile> experienced a noticeable drop in revenue rankings. Future updates will be monitored to assess the game’s performance moving forward.

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Sep 10
0

Daily Brief ECM: Midea Group H Share Listing (300 HK): Valuation Insights and more

By | Daily Briefs, ECM

In today’s briefing:

  • Midea Group H Share Listing (300 HK): Valuation Insights
  • Midea A/H Listing – Bigger Deal, Better Pricing
  • Terumo Placement Follow-Up – Correction Has Been Inline with Recent Cross-Shareholding Unwind
  • Terumo (4543 JP): The Current Playbook
  • K Bank IPO – The Biggest IPO in Korea in 2024
  • Bajaj Housing Finance IPO- Forensic Analysis
  • P N Gadgil Jewellers IPO – RHP Updates & Quick Thoughts on Peer Comp and Valuation
  • The Story Behind K-Bank Leaking Pricing Details Before the IPO Prospectus Dropped
  • Via Technologies Early Look – Wouldn’t Be a Large One to Digest
  • Hozon New Energy Automobile Pre-IPO – The Positives – Has Been Ramping Up

Midea Group H Share Listing (300 HK): Valuation Insights

By Arun George

Midea A/H Listing – Bigger Deal, Better Pricing

By Sumeet Singh

  • Midea Group Co Ltd A (000333 CH) aims to raise up to US$3.5bn in its H-share listing, the deal is somewhat larger than what was being spoken about earlier.
  • Midea Group is one of the world’s largest home appliance manufacturing companies with a presence in over 200 countries. Its A-shares have been listed since 2013.
  • We have covered the deal background in our previous notes. In this note, we talk about valuations.

Terumo Placement Follow-Up – Correction Has Been Inline with Recent Cross-Shareholding Unwind

By Clarence Chu

Terumo (4543 JP): The Current Playbook

By Arun George

  • Since the US$1.4 billion secondary placement announcement, Terumo Corp (4543 JP)’s shares are down 3.5% from the undisturbed price of JPY2,771 per share (29 August).
  • Looking at recent large Japanese placements is instructive to understand the potential trading pattern. So far, Terumo’s shares have followed the pattern of previous large placements.
  • The offering will likely be priced on 10 September. Despite Kokusai and Honda’s disappointing performance, the average large Japanese placement tends to generate positive returns.

K Bank IPO – The Biggest IPO in Korea in 2024

By Douglas Kim

  • K Bank is the biggest IPO in Korea in 2024. The IPO price range is from 9,500 won to 12,000 won. It is offering 82 million shares in this IPO.
  • According to the bankers’ valuation, the expected market cap of the company is from 4.0 trillion won to 5.0 trillion won.
  • The IPO deal size is 779 billion (US$579 million) to 984 billion won (US$732 million). 

Bajaj Housing Finance IPO- Forensic Analysis

By Nitin Mangal

  • Bajaj Housing Finance (BHF IN) upcoming IPO is worth INR 65.6 bn, comprising of fresh issue worth INR 35.6 bn and offer for sale worth INR 30 bn. 
  • The company reports strong KPIs and has been better than peers in several aspects. AUM growth is strong and is driven by Developer Financing and Lease Rental Discounting. 
  • There are few important cautions regarding the NHB observations and assignments.

P N Gadgil Jewellers IPO – RHP Updates & Quick Thoughts on Peer Comp and Valuation

By Akshat Shah

  • P N Gadgil Jewellers (1742652D IN) is looking to raise up to US$132m in its India IPO.
  • P N Gadgil Jewellers (PNGJ) is an Indian organized jewellery player. Its product offerings include traditional as well as modern and functional jewellery designs, in gold, diamond, silver and platinum.
  • Previously, we talked about the company’s historical performance. In this note, we provide a summary of its RHP updates and share our quick thoughts on peer comparison and valuation.

The Story Behind K-Bank Leaking Pricing Details Before the IPO Prospectus Dropped

By Sanghyun Park

  • To justify a higher multiple, K-Bank is comparing itself to international internet banks, with KakaoBank as the only local peer. Differences in market conditions could complicate this comparison.
  • This might explains why K-Bank is cautiously testing the market by announcing the rights issue first and delaying the prospectus, amid regulatory crackdowns on inflated IPOs.
  • Controversy over high multiples from overseas peers and KakaoBank’s legal discount will be key in setting K-Bank’s IPO pricing.

Via Technologies Early Look – Wouldn’t Be a Large One to Digest

By Clarence Chu

  • Via Technologies (2388 TT) is looking to raise US$220m in its upcoming global depository receipts (GDRs) offering.
  • In July 2024, Via Technologies (Via Tech) announced its board’s resolution to issue up to 75m common shares via a GDR offering.
  • Similar to previous GDR listings, the deal is a long drawn out process with the firm required to jump through a number of board/shareholder/regulatory approval loops.

Hozon New Energy Automobile Pre-IPO – The Positives – Has Been Ramping Up

By Sumeet Singh

  • Hozon New Energy Automobile is looking to raise up to US$1bn in its upcoming HK IPO. 
  • Hozon New Energy Automobile (HNEA) is a NEV technology company which sells cars under the Neta brand. The prices of its vehicles generally range between US$15,000 to US$45,000.
  • In this note, we talk about the positive aspects of the deal.

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Sep 10
0

Daily Brief Credit: Morning Views Asia: Azure Power Global Ltd and more

By | Credit, Daily Briefs

In today’s briefing:

  • Morning Views Asia: Azure Power Global Ltd

Morning Views Asia: Azure Power Global Ltd

By Leonard Law, CFA

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

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