All Posts By

Smartkarma Daily Briefs

Jan 09
0

Daily Brief Industrials: Doosan Robotics , Inabata & Co, Japan Airlines, Ferrotec Corp, S.F. Holding, Standard Profil AS and more

By | Daily Briefs, Industrials

In today’s briefing:

  • An Early Look at the Potential KOSPI200 Rebalance Candidates in June 2024
  • Inabata & Co Placement – Should Come as a Surprise
  • Japan Airlines: Seasonality Scrutiny Still Suggests Significant Upside to FY24 Guidance
  • Ferrotec (6890 JP): Return to Growth Led by Power Semiconductor Substrates
  • Kerry Logistics Network to Pay Dividend in Form of KEX Shares | SF Holding’s Role & Objectives
  • Standard Profil – ESG Report – Lucror Analytics

An Early Look at the Potential KOSPI200 Rebalance Candidates in June 2024

By Douglas Kim

  • We discuss the potential KOSPI200 rebalance candidates in June 2024. In the past several years, there have been a lot of alpha generating stocks arising from the KOSPI200 rebalances.
  • The following companies are likely candidates which could be included in KOSPI200 rebalance in June 2024, including Posco DX, Doosan Robotics, Hyosung Heavy Industries Corp, and DS Dansuk. 
  • For the potential exclusion candidates, we included 10 stocks that are in the bottom 5% market caps in KOSPI200.

Inabata & Co Placement – Should Come as a Surprise

By Ethan Aw

  • Sumitomo Chemical (4005 JP) and Mizuho Trust & Banking are looking to raise around US$180m through the sale of their stake in Inabata & Co (8098 JP).
  • The deal is a large one to digest, at 90 days of three month ADV and 15% of current mcap. 
  • In this note, we will talk about the deal dynamics and run the deal through our ECM framework.

Japan Airlines: Seasonality Scrutiny Still Suggests Significant Upside to FY24 Guidance

By Neil Glynn

  • We revisit FY24 prospects by highlighting that historical full service carrier (FSC) earnings seasonality suggests group EBIT guidance of ¥130bn is very conservative.
  • FSC FY24 EBIT guidance of ¥80bn implies only ¥9bn in 2H, 12% of 1H’s ¥71bn, whereas historically 2H has represented 74-83% of 1H. We model ¥59bn or 84% in 2H.
  • Our ¥176.5bn group EBIT for FY24 is 36% above guidance but also 27% above Visible Alpha consensus, largely due to lower costs, which position JAL strongly for the long-term.

Ferrotec (6890 JP): Return to Growth Led by Power Semiconductor Substrates

By Scott Foster

  • Ferrotec shares have dropped by a third since last July and are now selling at 8.2x EPS guidance and 0.6x book value.
  • Sales and operating should start to recover in 2H of FY Mar-24, led by power semiconductor substrates.
  • Buy for the upturn in the semiconductor cycle and capacity expansion in Japan, China and Malaysia. No significant damage from the Noto Peninsula earthquake has been reported.

Kerry Logistics Network to Pay Dividend in Form of KEX Shares | SF Holding’s Role & Objectives

By Daniel Hellberg

  • Kerry Logistics Network will pay a special dividend in the form of KEX shares
  • This will trigger a general offer by SF Holding for all KEX shares at THB 5.50
  • Why is SF Holding doing this, & how could its int’l express business change?

Standard Profil – ESG Report – Lucror Analytics

By Charles Macgregor

  • Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
  • We assess Standard Profil’s ESG as “Adequate”, in line with its “Adequate” Environmental, Social and Governance scores. Controversies are “Immaterial”, but Disclosure is “Weak”. 
  • Standard Profil (SP) is a European manufacturer of automotive sealing solutions.

💡 Before it’s here, it’s on Smartkarma

Sign Up for Free

The Smartkarma Preview Pass is your entry to the Independent Investment Research Network

  • ✓ Unlimited Research Summaries
  • ✓ Personalised Alerts
  • ✓ Custom Watchlists
  • ✓ Company Data and News
  • ✓ Events & Webinars
Sign Up for Free


Jan 09
0

Daily Brief Financials: Power Finance, Bitcoin, S&P/ASX 200, Soybean Oil Active Contract, Numis Corporation and more

By | Daily Briefs, Financials

In today’s briefing:

  • Power Finance – Largest NBFC in India, Direct Focus on Power Infrastructure, Steady, Strong Returns
  • Crypto Moves #9 – Is It Too Obvious That 2024 is the Year of Crypto?
  • EQD | S&P/ASX200 Going Down… (Approaching Support to Go LONG)
  • China’s Role as Commodity Importer & The Problem that Emerges for the Soybean Complex
  • Numis Corporation – Termination of coverage

Power Finance – Largest NBFC in India, Direct Focus on Power Infrastructure, Steady, Strong Returns

By Daniel Tabbush

  • Steady and strong profit is the key features of Power Finance and this is improving during FY24.
  • ROA expansion can continue to reach and possibly surpass the peaks of FY15 and FY16 with loan volume, contained costs, better credit metrics.
  • Recent quarterly data shows better loan volume and financial assets expanding more than financial liabilities, with credit costs in reverse.

Crypto Moves #9 – Is It Too Obvious That 2024 is the Year of Crypto?

By Andreas Steno

  • Everyone is buzzing with anticipation, predicting a highly favorable year for crypto.
  • The general sentiment in the market suggests that 2024 will be a memorable year, drawing parallels to the positive environments witnessed in 2017 and 2021.
  • The crypto landscape was overshadowed by the dramatic collapse of FTX in November 2022, making 2022 end on a rather bleak note. 

EQD | S&P/ASX200 Going Down… (Approaching Support to Go LONG)

By Nico Rosti

  • The S&P/ASX 200 INDEX is oversold, currently down for 2 weeks (actually the second week down has just started), it has good chances to bounce this week.
  • The best set up would be: index closing the week down at the end of this week: GO LONG at Close (or at any high probability support level reached intra-week).
  • A reprise of the rally should last into the end of January (or longer).

China’s Role as Commodity Importer & The Problem that Emerges for the Soybean Complex

By The Commodity Report

  • We all know about China’s importance in global trade as it is the single most important importer of many key commodities and raw materials.
  • This great chart by S&P Global highlights this once again.
  • Meanwhile, this importance could at least top out over the next couple of years – as the demographic problem really hits the country.

Numis Corporation – Termination of coverage

By Edison Investment Research

Edison Investment Research is terminating coverage on Kinarus Therapeutics (KNRS), Numis Corporation (NUM), EMIS Group (EMIS), Pixium Vision (PIX) and Treatt (TET). Please note you should no longer rely on any previous research or estimates for this company. All forecasts should now be considered redundant. Previously published reports can still be accessed via website

💡 Before it’s here, it’s on Smartkarma

Sign Up for Free

The Smartkarma Preview Pass is your entry to the Independent Investment Research Network

  • ✓ Unlimited Research Summaries
  • ✓ Personalised Alerts
  • ✓ Custom Watchlists
  • ✓ Company Data and News
  • ✓ Events & Webinars
Sign Up for Free


Jan 09
0

Daily Brief Consumer: Samsonite, Ola Electric, Fast Retailing, Oriental Watch, Alibaba (ADR), PDD Holdings, MIXUE Group and more

By | Consumer, Daily Briefs

In today’s briefing:

  • Hang Seng Index (HSI) Rebalance Preview: Inclusion Candidates for March
  • Ola Electric Mobility Pre-IPO Tearsheet
  • Ola Electric IPO: The Bear Case
  • Fast Retailing (9983) | Q1 Preview – Slight Miss
  • Oriental Watch (398 HK): Ex-Dividend, Cash Levels To Mkt Cap at 60%, 6.8x PE, 14% Dividend Yield
  • Aequitas HK IPOs + Placements Broker Performance 2023
  • PDD (PDD US): Stopped Diversifying into ‘Local Life’ – A Rational Decision During Fast Growing
  • MIXUE Group Pre-IPO Tearsheet

Hang Seng Index (HSI) Rebalance Preview: Inclusion Candidates for March

By Brian Freitas

  • At 82 index constituents currently, we expect the index committee to progress towards reaching 100 constituents. We are (highly) unlikely to reach the target this calendar year though.
  • We highlight nine stocks that have a decent chance at being added to the index over the next couple of rebalances. All companies are profitable and meet inclusion requirements.
  • The market consultation on proposed changes to the Hang Seng Industry Classification System (HSICS) could lead to more inclusions from the Information Technology sector from the June rebalance.

Ola Electric Mobility Pre-IPO Tearsheet

By Clarence Chu

  • Ola Electric (1700674D IN) is looking to raise about US$1bn in its upcoming India IPO. The bookrunners are Kotak, Citigroup, BofA, Goldman Sachs, Axis, ICICI Sec, SBI Caps, BoB Caps.
  • Ola Electric Mobility is a vertically integrated pure EV player in India with manufacturing capabilities for EVs and EV components, including cells.
  • The firm manufactures EVs and certain core EV components like battery packs, motors and vehicle frames.

Ola Electric IPO: The Bear Case

By Arun George

  • Ola Electric (1700674D IN), the largest Indian electric two-wheel vehicles (E2W) player, is seeking US$660 million from a primary raise along with a secondary raise at a US$7-8 billion valuation.
  • In Ola Electric IPO: The Bull Case, we highlighted the key elements of the bull case. In this note, we outline the bear case.
  • The bear case rests on high R&D capitalization, ongoing losses, high attrition, declining contract liabilities, cash burn and deteriorating balance sheet. 

Fast Retailing (9983) | Q1 Preview – Slight Miss

By Mark Chadwick

  • We anticipate a sluggish beginning to the fiscal year with 1Q8/24 earnings reflecting slower growth in Japan, China, and Southeast Asia.
  • Our forecast for 1Q24 operating profit stands at ¥130 billion, slightly below the consensus estimate of ¥138 billion. Assuming our estimates are accurate, we anticipate a slightly negative share-price reaction.
  • Our bearish stance on the stock persists, driven by the fact that it trades at a premium to our DCF and at a premium compared to global peers

Oriental Watch (398 HK): Ex-Dividend, Cash Levels To Mkt Cap at 60%, 6.8x PE, 14% Dividend Yield

By Sameer Taneja

  • Oriental Watch (398 HK)  went ex-dividend on the 4th of January and has settled at an appetizing valuation of 6.8x PE with 60% of the market cap in cash.
  • The market post-golden week and into the new year has been tepid.
  • We expect the company to continue paying out 100% of its profits as dividends, based on which the dividend yield is close to 14% at the current share price.

Aequitas HK IPOs + Placements Broker Performance 2023

By Ethan Aw

  • In this note, we will take a look at broker performance for HK IPOs and placements in 2023. 
  • The following dataset includes all HK IPOs and placements above US$100m, which amounted to a total of 27 deals.
  • The deals you see in this note are based on our historical IPO and placement tracker. Feel free to drop us a message for additional information.

PDD (PDD US): Stopped Diversifying into ‘Local Life’ – A Rational Decision During Fast Growing

By Ming Lu

  • PDD diversified into ‘local life’ businesses in December 2023, but stopped these businesses within two weeks.
  • We believe PDD’s low price advantage does not work in Meituan-like ‘local life’ and the top performer Meituan is hard to fight.
  • We believe the stock price has an upside of 88% for year end 2024.

MIXUE Group Pre-IPO Tearsheet

By Clarence Chu

  • MIXUE Group (1860056D CH) is looking to raise about US$1bn in its upcoming Hong Kong IPO. The bookrunners on the deal are Bank of America, Goldman Sachs, and UBS.
  • MIXUE Group (MIXUE) is a freshly-made drinks company providing affordable products to consumers, including freshly-made fruit drinks, tea, ice cream and coffee, typically priced at around one USD per item.
  • The firm is the largest domestically freshly-made drinks company in terms of number of stores as of Sept 23, and number of cups sold during 9M23, according to CIC.

💡 Before it’s here, it’s on Smartkarma

Sign Up for Free

The Smartkarma Preview Pass is your entry to the Independent Investment Research Network

  • ✓ Unlimited Research Summaries
  • ✓ Personalised Alerts
  • ✓ Custom Watchlists
  • ✓ Company Data and News
  • ✓ Events & Webinars
Sign Up for Free


Jan 09
0

Most Read: Tower Bersama Infrastructure, Aoki Super, Wuxi Biologics, L&F Co Ltd, Socionext, Samsonite, TDCX, Hollysys Automation Technologies, Wipro Ltd, Doosan Robotics and more

By | Daily Briefs, Most Read

In today’s briefing:

  • LQ45 Index Rebalance Preview (Jan): Reading the Tea Leaves
  • Aoki Super (9977) MBO at ¥3,800/Share (All-Time High, 15x Forecast FCF)
  • FXI Rebalance Preview: Two Potential Changes in March
  • Event Trading on KOSPI Transfer Listings: Notable Post-Listing Price Patterns
  • March 2024 Nikkei 225 Rebal:  Socionext, Disco, and a Consumer Goods Stock, Still
  • Hang Seng Index (HSI) Rebalance Preview: Inclusion Candidates for March
  • TDCX (TDCX US): Laurent Junique’s NBIO
  • Hollysys (HOLI US): 8th Feb Shareholder Vote. Dazheng Fails The Sniff Test
  • Quiddity Leaderboard BSE/​​​​SENSEX Jun 24: Wipro SENSEX Deletion Possible
  • An Early Look at the Potential KOSPI200 Rebalance Candidates in June 2024

LQ45 Index Rebalance Preview (Jan): Reading the Tea Leaves

By Brian Freitas

  • The review period for the LQ45 Index ended on 29 December. The changes should be announced in the last week of January, becoming effective after the close on 31 January.
  • Based on the index methodology, there could be up to 5 changes at the rebalance. Plus there will be capping changes for Bank Rakyat (BBRI) and Bank Central Asia (BBCA).
  • The impact of passive trading will be higher on the deletions than the inclusions since lower liquidity stocks are replaced with higher liquidity stocks.

Aoki Super (9977) MBO at ¥3,800/Share (All-Time High, 15x Forecast FCF)

By Travis Lundy

  • The family which owns and controls ubiquitous Nagoya supermarket chain Aoki Super (9977 JP) will acquire the 47% it does not own in an MBO. 
  • This appears to be an estate planning exercise, creating a context to hand off ownership from the 77yr old former CEO to his 44yr old son and current CEO. 
  • This comes in at a 44% premium, an all-time high price, and 15+x forecast FCF (even if the forecast looks a little light). This gets done easily.

FXI Rebalance Preview: Two Potential Changes in March

By Brian Freitas

Event Trading on KOSPI Transfer Listings: Notable Post-Listing Price Patterns

By Sanghyun Park

  • In the past year, four KOSPI transfer listings showed similar patterns, with pre-listing price increases and substantial corrections in the first five trading days post-listing.
  • ChatGPTAmid a sideways market and a 54.2% YoY growth in the local ETF market last year, the impact of passive flow imbalances may have been more significant than before.
  • A key factor is the short-selling ban. Posco DX’s SSFs showed significant backwardation pre-KOSPI listing, concentrating proactive short positions, requiring caution in adjusting pre-listing short position costs.

March 2024 Nikkei 225 Rebal:  Socionext, Disco, and a Consumer Goods Stock, Still

By Travis Lundy

  • No changes in the rankings since last time. Socionext (6526), Disco (6146), and a Consumer Goods stock (Zozo (3092) top-ranked, Ryohin Keikaku (7453) a better choice) are ADDs.
  • The DELETEs are still Takara Holdings (2531), Pacific Metals (5541), Sumitomo Osaka Cement (5232) with a dark horse candidate in Hitachi Zosen (7004) to replace Takara.
  • There is the upweight to Nitori (9843) but now less funkiness with Fast Retailing (9983). But it will continue being an interesting Nikkei 225 influence (for years to come).

Hang Seng Index (HSI) Rebalance Preview: Inclusion Candidates for March

By Brian Freitas

  • At 82 index constituents currently, we expect the index committee to progress towards reaching 100 constituents. We are (highly) unlikely to reach the target this calendar year though.
  • We highlight nine stocks that have a decent chance at being added to the index over the next couple of rebalances. All companies are profitable and meet inclusion requirements.
  • The market consultation on proposed changes to the Hang Seng Industry Classification System (HSICS) could lead to more inclusions from the Information Technology sector from the June rebalance.

TDCX (TDCX US): Laurent Junique’s NBIO

By David Blennerhassett

  • TDCX (TDCX US), a Singapore-headquartered digital customer experience (CX) provider, has announced a preliminary non-binding proposal from Laurent Junique, founder/CEO, and largest shareholder (98.3% of the voting power).
  • Junique is offering US$6.60/ADS, a 39% premium to the 30-day VWAP, but a 63% discount to its IPO price a little over two years ago. 
  • One issue dogging TDCX is the key man risk given Junique’s almost absolute control. Now he’s trying to take the company private on the cheap.

Hollysys (HOLI US): 8th Feb Shareholder Vote. Dazheng Fails The Sniff Test

By David Blennerhassett

  • Hollysys Automation Technologies (HOLI US) has announced that an EGM is scheduled for February 8th to vote on the merger agreement with Ascendent Capital Partners. 
  • The Offer price remains at US$26.50/ADS. The shareholder approval required is simple majority. Regulatory approvals include NDRC, MoC and SAFE. Maybe a national security review.
  • And the Dazheng consortium? Apparently insufficient information as to its financing sources and consortium structure ruled it out. Separately, the SGM to spill the board has now been called off. 

Quiddity Leaderboard BSE/​​​​SENSEX Jun 24: Wipro SENSEX Deletion Possible

By Janaghan Jeyakumar, CFA

  • In this insight, we take a look at the Potential ADDs/DELs for the BSE SENSEX, 100, and 200 Indices in the June 2024 index rebal event.
  • As things stand, there could be one index change for the SENSEX index. 
  • There could be four ADDs/DELs for the BSE 100 index and four ADDs/DELs for the BSE 200 index.

An Early Look at the Potential KOSPI200 Rebalance Candidates in June 2024

By Douglas Kim

  • We discuss the potential KOSPI200 rebalance candidates in June 2024. In the past several years, there have been a lot of alpha generating stocks arising from the KOSPI200 rebalances.
  • The following companies are likely candidates which could be included in KOSPI200 rebalance in June 2024, including Posco DX, Doosan Robotics, Hyosung Heavy Industries Corp, and DS Dansuk. 
  • For the potential exclusion candidates, we included 10 stocks that are in the bottom 5% market caps in KOSPI200.

💡 Before it’s here, it’s on Smartkarma

Sign Up for Free

The Smartkarma Preview Pass is your entry to the Independent Investment Research Network

  • ✓ Unlimited Research Summaries
  • ✓ Personalised Alerts
  • ✓ Custom Watchlists
  • ✓ Company Analytics and News
  • ✓ Events & Webinars
Sign Up for Free



Jan 09
0

Daily Brief Australia: S&P/ASX 200 and more

By | Australia, Daily Briefs

In today’s briefing:

  • EQD | S&P/ASX200 Going Down… (Approaching Support to Go LONG)

EQD | S&P/ASX200 Going Down… (Approaching Support to Go LONG)

By Nico Rosti

  • The S&P/ASX 200 INDEX is oversold, currently down for 2 weeks (actually the second week down has just started), it has good chances to bounce this week.
  • The best set up would be: index closing the week down at the end of this week: GO LONG at Close (or at any high probability support level reached intra-week).
  • A reprise of the rally should last into the end of January (or longer).

💡 Before it’s here, it’s on Smartkarma

Sign Up for Free

The Smartkarma Preview Pass is your entry to the Independent Investment Research Network

  • ✓ Unlimited Research Summaries
  • ✓ Personalised Alerts
  • ✓ Custom Watchlists
  • ✓ Company Data and News
  • ✓ Events & Webinars
Sign Up for Free


Jan 09
0

Daily Brief ESG: Standard Profil – ESG Report – Lucror Analytics and more

By | Daily Briefs, ESG

In today’s briefing:

  • Standard Profil – ESG Report – Lucror Analytics

Standard Profil – ESG Report – Lucror Analytics

By Charles Macgregor

  • Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
  • We assess Standard Profil’s ESG as “Adequate”, in line with its “Adequate” Environmental, Social and Governance scores. Controversies are “Immaterial”, but Disclosure is “Weak”. 
  • Standard Profil (SP) is a European manufacturer of automotive sealing solutions.

💡 Before it’s here, it’s on Smartkarma

Sign Up for Free

The Smartkarma Preview Pass is your entry to the Independent Investment Research Network

  • ✓ Unlimited Research Summaries
  • ✓ Personalised Alerts
  • ✓ Custom Watchlists
  • ✓ Company Data and News
  • ✓ Events & Webinars
Sign Up for Free


Jan 09
0

Daily Brief South Korea: L&F Co Ltd, Doosan Robotics and more

By | Daily Briefs, South Korea

In today’s briefing:

  • Event Trading on KOSPI Transfer Listings: Notable Post-Listing Price Patterns
  • An Early Look at the Potential KOSPI200 Rebalance Candidates in June 2024

Event Trading on KOSPI Transfer Listings: Notable Post-Listing Price Patterns

By Sanghyun Park

  • In the past year, four KOSPI transfer listings showed similar patterns, with pre-listing price increases and substantial corrections in the first five trading days post-listing.
  • ChatGPTAmid a sideways market and a 54.2% YoY growth in the local ETF market last year, the impact of passive flow imbalances may have been more significant than before.
  • A key factor is the short-selling ban. Posco DX’s SSFs showed significant backwardation pre-KOSPI listing, concentrating proactive short positions, requiring caution in adjusting pre-listing short position costs.

An Early Look at the Potential KOSPI200 Rebalance Candidates in June 2024

By Douglas Kim

  • We discuss the potential KOSPI200 rebalance candidates in June 2024. In the past several years, there have been a lot of alpha generating stocks arising from the KOSPI200 rebalances.
  • The following companies are likely candidates which could be included in KOSPI200 rebalance in June 2024, including Posco DX, Doosan Robotics, Hyosung Heavy Industries Corp, and DS Dansuk. 
  • For the potential exclusion candidates, we included 10 stocks that are in the bottom 5% market caps in KOSPI200.

💡 Before it’s here, it’s on Smartkarma

Sign Up for Free

The Smartkarma Preview Pass is your entry to the Independent Investment Research Network

  • ✓ Unlimited Research Summaries
  • ✓ Personalised Alerts
  • ✓ Custom Watchlists
  • ✓ Company Data and News
  • ✓ Events & Webinars
Sign Up for Free


Jan 09
0

Daily Brief Thematic (Sector/Industry): Ohayo Japan: Tech Lifts Stocks; Wage Hikes Gaining Acceptance in Japan and more

By | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

  • Ohayo Japan: Tech Lifts Stocks; Wage Hikes Gaining Acceptance in Japan
  • Equity Strategy: US Regional Banks: Not Out of the Woods Yet
  • Furniture/Furnishings Weekly – WTR Furniture/Furnishings Conference Approaching
  • Industry Report – Chemicals & Materials Technology
  • The Highlights – Cannabis News for the Week Ending January 5, 2024

Ohayo Japan: Tech Lifts Stocks; Wage Hikes Gaining Acceptance in Japan

By Mark Chadwick

  • Overseas: US Tech stocks lead charge higher. Nvidia +6.4% to all-time high; Semicon ETF +3.5%; Boeing -8%; WTI Crude -4% on Saudi price cuts 
  • Today: NKY Futures point to strong open; JPY stable at 144/$; Honda considers $14b plant in Canada; Uniqlo Japan December sales -15%
  • Japan: Wage hikes, at least for larger companies, could be in the +5-6% range this year. Good news for BoJ looking to exit ultra lose policy

Equity Strategy: US Regional Banks: Not Out of the Woods Yet

By Raj Saya, CA, CFA

  • Large regional banks in the US have been troubled in 2023 by the proposed “Basel III Endgame” regulations, asset quality issues and earning pressure in terms of the high COF
  • We believe these factors have made the sector more cyclical and vulnerable to even a mild recession scenario in 2024-25
  • We are particularly weary of names at regulatory risk (like USB), and those with higher exposures to CRE

Furniture/Furnishings Weekly – WTR Furniture/Furnishings Conference Approaching

By Water Tower Research

  • Furniture & furnishings equity issues slumped in the final two weeks of 2023 and into the first week of 2024. The group had a positive year.

  • The commercial/contract furniture stocks gained 46%, beating all major broad market indices.

  • Steelcase led the sector with a ~91% gain for the year.

Industry Report – Chemicals & Materials Technology

By Water Tower Research

  • WTR-CMI in 2023. With the majority of stocks in our index finishing the year in positive territory, the WTR-CMI Index managed to keep pace with the Russell 2000, appreciating 15%.
  • However, both indexes fell well short of the 24% growth of the S&P 500 in 2023, with the WTR- CMI Index dragged down by four companies that lost more than 50% in value during the year.
  • Weak demand and destocking. Looking back at 2023, several themes are emerging as we head into 2024, such as declining commodity prices and weakening end-market demand, with Y/Y volume comps affected by destocking across several end-markets since mid-year, as supply chain constraints, which characterized 2022, are resolved and companies go back to just-in-time inventory management.

The Highlights – Cannabis News for the Week Ending January 5, 2024

By Water Tower Research

  • It was a strong start of the year for cannabis stocks, with the US cannabis MSOS ETF gaining 13.12% and the global YOLO ETF increasing 9.11%.
  • US cannabis continues to outperform Canadian and other global names due to the positive sentiment driven by the potential for the DEA to agree with the HHS’s Schedule III recommendation.
  • This would eradicate 280E, the onerous tax code that applies to plant-touching US operators.

💡 Before it’s here, it’s on Smartkarma

Sign Up for Free

The Smartkarma Preview Pass is your entry to the Independent Investment Research Network

  • ✓ Unlimited Research Summaries
  • ✓ Personalised Alerts
  • ✓ Custom Watchlists
  • ✓ Company Data and News
  • ✓ Events & Webinars
Sign Up for Free


Jan 09
0

Daily Brief ECM: Ola Electric Mobility Pre-IPO Tearsheet and more

By | Daily Briefs, ECM

In today’s briefing:

  • Ola Electric Mobility Pre-IPO Tearsheet
  • Ola Electric IPO: The Bear Case
  • Aequitas HK IPOs + Placements Broker Performance 2023
  • Inabata & Co Placement – Should Come as a Surprise
  • MIXUE Group Pre-IPO Tearsheet
  • Kerry Logistics Network to Pay Dividend in Form of KEX Shares | SF Holding’s Role & Objectives
  • Aequitas 2023 IPOs and Placements Performance Review – IPOs Forming a Low Base, Placements Pick Up
  • Pre-IPO IVF Hospital Management Group – The Industry, the Business and the Risks Behind

Ola Electric Mobility Pre-IPO Tearsheet

By Clarence Chu

  • Ola Electric (1700674D IN) is looking to raise about US$1bn in its upcoming India IPO. The bookrunners are Kotak, Citigroup, BofA, Goldman Sachs, Axis, ICICI Sec, SBI Caps, BoB Caps.
  • Ola Electric Mobility is a vertically integrated pure EV player in India with manufacturing capabilities for EVs and EV components, including cells.
  • The firm manufactures EVs and certain core EV components like battery packs, motors and vehicle frames.

Ola Electric IPO: The Bear Case

By Arun George

  • Ola Electric (1700674D IN), the largest Indian electric two-wheel vehicles (E2W) player, is seeking US$660 million from a primary raise along with a secondary raise at a US$7-8 billion valuation.
  • In Ola Electric IPO: The Bull Case, we highlighted the key elements of the bull case. In this note, we outline the bear case.
  • The bear case rests on high R&D capitalization, ongoing losses, high attrition, declining contract liabilities, cash burn and deteriorating balance sheet. 

Aequitas HK IPOs + Placements Broker Performance 2023

By Ethan Aw

  • In this note, we will take a look at broker performance for HK IPOs and placements in 2023. 
  • The following dataset includes all HK IPOs and placements above US$100m, which amounted to a total of 27 deals.
  • The deals you see in this note are based on our historical IPO and placement tracker. Feel free to drop us a message for additional information.

Inabata & Co Placement – Should Come as a Surprise

By Ethan Aw

  • Sumitomo Chemical (4005 JP) and Mizuho Trust & Banking are looking to raise around US$180m through the sale of their stake in Inabata & Co (8098 JP).
  • The deal is a large one to digest, at 90 days of three month ADV and 15% of current mcap. 
  • In this note, we will talk about the deal dynamics and run the deal through our ECM framework.

MIXUE Group Pre-IPO Tearsheet

By Clarence Chu

  • MIXUE Group (1860056D CH) is looking to raise about US$1bn in its upcoming Hong Kong IPO. The bookrunners on the deal are Bank of America, Goldman Sachs, and UBS.
  • MIXUE Group (MIXUE) is a freshly-made drinks company providing affordable products to consumers, including freshly-made fruit drinks, tea, ice cream and coffee, typically priced at around one USD per item.
  • The firm is the largest domestically freshly-made drinks company in terms of number of stores as of Sept 23, and number of cups sold during 9M23, according to CIC.

Kerry Logistics Network to Pay Dividend in Form of KEX Shares | SF Holding’s Role & Objectives

By Daniel Hellberg

  • Kerry Logistics Network will pay a special dividend in the form of KEX shares
  • This will trigger a general offer by SF Holding for all KEX shares at THB 5.50
  • Why is SF Holding doing this, & how could its int’l express business change?

Aequitas 2023 IPOs and Placements Performance Review – IPOs Forming a Low Base, Placements Pick Up

By Sumeet Singh

  • 2023 marked our eighth year covering Equity Capital Markets in Asia Pacific. In 2023, IPOs didn’t pick up much from the low base of 2022  while placements showed upward momentum.
  • We ended 2023 with an accuracy rate of 73.7% across 57 IPOs that we covered and 79.3% across 115 placements.
  • For those not familiar with our coverage, we aim to cover all IPOs and placements with a minimum deal size of US$100m across Asia-Pacific, including China ADRs.

Pre-IPO IVF Hospital Management Group – The Industry, the Business and the Risks Behind

By Xinyao (Criss) Wang

  • IVF Hospital’s profitability and growth momentum look good at this stage, but the Company is still in early stage of development, with obvious gap with leading players in the industry.
  • IVF penetration rate in China is not high and the rate of improvement is slow. With public hospitals accounting for over 90% market share, IVF Hospital’s growth space is limited.
  • Licensing is a big barrier for development, slowing down the pace of nationwide expansion. The “good story” should be based on internationalization, which is actually the weakness of IVF Hospital.

💡 Before it’s here, it’s on Smartkarma

Sign Up for Free

The Smartkarma Preview Pass is your entry to the Independent Investment Research Network

  • ✓ Unlimited Research Summaries
  • ✓ Personalised Alerts
  • ✓ Custom Watchlists
  • ✓ Company Data and News
  • ✓ Events & Webinars
Sign Up for Free


Jan 09
0

Daily Brief United States: Samsonite, Hollysys Automation Technologies, Bitcoin, Soybean Oil Active Contract, Aspira Women’s Health and more

By | Daily Briefs, United States

In today’s briefing:

  • Hang Seng Index (HSI) Rebalance Preview: Inclusion Candidates for March
  • Hollysys (HOLI US): 8th Feb Shareholder Vote. Dazheng Fails The Sniff Test
  • Crypto Moves #9 – Is It Too Obvious That 2024 is the Year of Crypto?
  • China’s Role as Commodity Importer & The Problem that Emerges for the Soybean Complex
  • Aspira Women’s Health, Inc. – Aspira Women’s Health Hosts R&D Day

Hang Seng Index (HSI) Rebalance Preview: Inclusion Candidates for March

By Brian Freitas

  • At 82 index constituents currently, we expect the index committee to progress towards reaching 100 constituents. We are (highly) unlikely to reach the target this calendar year though.
  • We highlight nine stocks that have a decent chance at being added to the index over the next couple of rebalances. All companies are profitable and meet inclusion requirements.
  • The market consultation on proposed changes to the Hang Seng Industry Classification System (HSICS) could lead to more inclusions from the Information Technology sector from the June rebalance.

Hollysys (HOLI US): 8th Feb Shareholder Vote. Dazheng Fails The Sniff Test

By David Blennerhassett

  • Hollysys Automation Technologies (HOLI US) has announced that an EGM is scheduled for February 8th to vote on the merger agreement with Ascendent Capital Partners. 
  • The Offer price remains at US$26.50/ADS. The shareholder approval required is simple majority. Regulatory approvals include NDRC, MoC and SAFE. Maybe a national security review.
  • And the Dazheng consortium? Apparently insufficient information as to its financing sources and consortium structure ruled it out. Separately, the SGM to spill the board has now been called off. 

Crypto Moves #9 – Is It Too Obvious That 2024 is the Year of Crypto?

By Andreas Steno

  • Everyone is buzzing with anticipation, predicting a highly favorable year for crypto.
  • The general sentiment in the market suggests that 2024 will be a memorable year, drawing parallels to the positive environments witnessed in 2017 and 2021.
  • The crypto landscape was overshadowed by the dramatic collapse of FTX in November 2022, making 2022 end on a rather bleak note. 

China’s Role as Commodity Importer & The Problem that Emerges for the Soybean Complex

By The Commodity Report

  • We all know about China’s importance in global trade as it is the single most important importer of many key commodities and raw materials.
  • This great chart by S&P Global highlights this once again.
  • Meanwhile, this importance could at least top out over the next couple of years – as the demographic problem really hits the country.

Aspira Women’s Health, Inc. – Aspira Women’s Health Hosts R&D Day

By Water Tower Research

  • Aspira Women’s Health hosted an R&D Day and discussed updates on its non-invasive diagnostic platforms for ovarian cancer and endometriosis.
  • CEO Nicole Sandford led the discussion, and was joined by Chief Scientific Officer Dr. Jody Berry, PhD, and one of Aspira’s medical advisors and research partners, Dr. Kevin Elias, MD.
  • Aspira also discussed the domestic market potential for both ovarian cancer and endometriosis products, which it estimates is more than $1.5 billion.

💡 Before it’s here, it’s on Smartkarma

Sign Up for Free

The Smartkarma Preview Pass is your entry to the Independent Investment Research Network

  • ✓ Unlimited Research Summaries
  • ✓ Personalised Alerts
  • ✓ Custom Watchlists
  • ✓ Company Data and News
  • ✓ Events & Webinars
Sign Up for Free