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Smartkarma Daily Briefs

Jun 14
0

Daily Brief Industrials: AP Moeller – Maersk A/S, Tokai Holdings and more

By | Daily Briefs, Industrials

In today’s briefing:

  • Why an Israel-Hamas Ceasefire Probably Wouldn’t Lead to Lower Container Rates in Short-Term
  • Tokai Holdings (3167 JP): Full-year FY03/24 flash update
  • Tokai Holdings (3167 JP): Full-year FY03/24 flash update
  • Aeon Delight (9787 JP): Full-year FY02/24 flash update
  • Aeon Delight (9787 JP): Full-year FY02/24 flash update
  • Aeon Delight (9787 JP): Full-year FY02/24 flash update
  • Aeon Delight (9787 JP): Full-year FY02/24 flash update
  • Aeon Delight (9787 JP): Full-year FY02/24 flash update
  • Aeon Delight (9787 JP): Full-year FY02/24 flash update
  • Aeon Delight (9787 JP): Full-year FY02/24 flash update

Why an Israel-Hamas Ceasefire Probably Wouldn’t Lead to Lower Container Rates in Short-Term

By Daniel Hellberg

  • Its unclear whether Yemen-based Houthis would end attacks after ceasefire
  • We’ve entered peak Summer shipping season from Asia to US, Europe
  • Higher spot rates have already lifted contract rates in Q2 2024

Tokai Holdings (3167 JP): Full-year FY03/24 flash update

By Shared Research

  • FY03/24 sales reached JPY231.5bn (+0.6% YoY), operating profit JPY15.5bn (+4.0% YoY), and net income JPY8.5bn (+31.2% YoY).
  • Segment sales: Energy JPY101.0bn (-1.5% YoY), Information and Communications JPY56.7bn (+5.0% YoY), CATV JPY35.8bn (+3.7% YoY).
  • FY03/25 forecast: sales JPY244.0bn (+5.4% YoY), operating profit JPY16.0bn (+3.2% YoY), net income JPY9.0bn (+6.1% YoY).

Tokai Holdings (3167 JP): Full-year FY03/24 flash update

By Shared Research

  • FY03/24: Sales JPY231.5bn (+0.6% YoY), operating profit JPY15.5bn (+4.0% YoY), net income JPY8.5bn (+31.2% YoY).
  • FY03/25 forecast: Sales JPY244.0bn (+5.4% YoY), operating profit JPY16.0bn (+3.2% YoY), net income JPY9.0bn (+6.1% YoY).
  • Segment results: Energy sales JPY101.0bn (-1.5% YoY), Information and Communications sales JPY56.7bn (+5.0% YoY), Construction sales JPY25.0bn (-6.6% YoY).

Aeon Delight (9787 JP): Full-year FY02/24 flash update

By Shared Research

  • Sales grew 6.9% YoY to JPY324.8bn, exceeding the FY02/24 forecast, driven by existing and new customer contracts.
  • Operating profit fell 3.7% YoY to JPY15.2bn due to increased SG&A expenses despite segment profit growth.
  • The company plans to acquire 700,000 treasury shares (1.44% of total issued shares) valued at JPY3.1bn.

Aeon Delight (9787 JP): Full-year FY02/24 flash update

By Shared Research

  • Sales for FY02/23 were JPY324.8bn (+6.9% YoY), operating profit JPY15.2bn (-3.7% YoY), and net income JPY10.7bn (+5.5% YoY).
  • Full-year FY02/24 forecast: Sales JPY340.0bn (+4.7% YoY), operating profit JPY16.0bn (+5.0% YoY), and net income JPY10.4bn (-2.9% YoY).
  • The company plans to acquire 700,000 treasury shares (1.44% of total issued shares) with a total acquisition value of JPY3.1bn.

Aeon Delight (9787 JP): Full-year FY02/24 flash update

By Shared Research

  • Sales for FY02/23 were JPY324.8bn (+6.9% YoY), operating profit JPY15.2bn (-3.7% YoY), and net income JPY10.7bn (+5.5% YoY).
  • Sales grew YoY in all segments, notably in Construction Work and Materials and Supplies Sourcing Services, despite rising SG&A expenses.
  • Full-year forecast for FY02/24: Sales JPY340.0bn (+4.7% YoY), operating profit JPY16.0bn (+5.0% YoY), and annual dividends JPY87 per share.

Aeon Delight (9787 JP): Full-year FY02/24 flash update

By Shared Research

  • Sales increased 6.9% YoY to JPY324.8bn, driven by growth in existing customer wallets and new contracts.
  • Operating profit fell 3.7% YoY to JPY15.2bn, impacted by higher SG&A expenses despite segment profit growth.
  • Net income attributable to owners of the parent rose 5.5% YoY to JPY10.7bn, exceeding the full-year forecast.

Aeon Delight (9787 JP): Full-year FY02/24 flash update

By Shared Research

  • Sales for FY02/23 were JPY324.8bn (+6.9% YoY), operating profit JPY15.2bn (-3.7% YoY), and net income JPY10.7bn (+5.5% YoY).
  • Sales grew YoY in all seven segments, with notable growth in Construction Work and Materials and Supplies Sourcing Services.
  • Full-year forecast for FY02/24: Sales JPY340.0bn (+4.7% YoY), operating profit JPY16.0bn (+5.0% YoY), and annual dividends per share JPY87.

Aeon Delight (9787 JP): Full-year FY02/24 flash update

By Shared Research

  • Sales for FY02/23 were JPY324.8bn (+6.9% YoY), operating profit JPY15.2bn (-3.7% YoY), and net income JPY10.7bn (+5.5% YoY).
  • Sales and operating profit grew YoY in all segments, with notable increases in Construction Work and Materials and Supplies Sourcing Services.
  • The company plans to acquire 700,000 treasury shares (1.44% of total issued shares) with a total acquisition value of JPY3.1bn.

Aeon Delight (9787 JP): Full-year FY02/24 flash update

By Shared Research

  • Sales: JPY324.8bn (+6.9% YoY), Operating profit: JPY15.2bn (-3.7% YoY), Recurring profit: JPY15.5bn (-3.3% YoY), Net income: JPY10.7bn (+5.5% YoY).
  • Sales growth driven by existing customer wallet share and new contracts; notable growth in Construction Work and Materials and Supplies Sourcing Services.
  • Full-year forecast: Sales JPY340.0bn (+4.7% YoY), Operating profit JPY16.0bn (+5.0% YoY), Recurring profit JPY16.0bn (+3.3% YoY), Net income JPY10.4bn (-2.9% YoY).

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Jun 14
0

Daily Brief Health Care: Sigma Healthcare, Takeda Pharmaceutical, UMP Healthcare and more

By | Daily Briefs, Healthcare

In today’s briefing:

  • Sigma/Chemist Warehouse Merger: ACCC Has (Many) Issues
  • Takeda (4502 JP)– Avoid
  • UMP Healthcare (722 HK): Deep Value Turnaround in FY25
  • 3 D Matrix Ltd (7777 JP): Q3 FY04/24 flash update
  • 3 D Matrix Ltd (7777 JP): Q3 FY04/24 flash update
  • 3 D Matrix Ltd (7777 JP): Q3 FY04/24 flash update
  • 3 D Matrix Ltd (7777 JP): A second revision to the earnings forecast
  • 3 D Matrix Ltd (7777 JP): Q3 FY04/24 flash update
  • 3 D Matrix Ltd (7777 JP): Q3 FY04/24 flash update
  • 3 D Matrix Ltd (7777 JP): Q3 FY04/24 flash update

Sigma/Chemist Warehouse Merger: ACCC Has (Many) Issues

By David Blennerhassett

Takeda (4502 JP)– Avoid

By Avien Pillay

  • Given the high number of pipeline dropouts, and the potentially disappointing $6 bn psoriasis drug acquisition, we question Takeda’s recent investment track record.
  • A big restructuring, high expectations from new/recently launched drug portfolio, and punchy company guidance reduces the probability of upside surprises.
  • Unless you are limited from investing outside Japan and you want exposure to an innovative pharma company, we believe that there are better and cheaper options elsewhere.

UMP Healthcare (722 HK): Deep Value Turnaround in FY25

By Sameer Taneja

  • We preview UMP Healthcare (722 HK)  earnings for FY24 (June-end), which will be declared in September, and our outlook for FY25. 
  • The company has more than 300 mn HKD of net cash (almost 75% of its market cap), and even assuming a 20% dividend cut, it has an ~8% dividend yield.
  • On core earnings for FY24, we estimate that the stock trades at 12x PE( ex-cash 2.8x PE), with low-hanging fruit from streamlining the business in FY25. 

3 D Matrix Ltd (7777 JP): Q3 FY04/24 flash update

By Shared Research

  • Operating revenue grew 91.5% YoY to JPY3.0bn, driven by significant sales increases in the US and Japan.
  • The company revised its full-year FY04/24 earnings forecast, increasing operating revenue to JPY4.1bn and net loss to JPY1.0bn.
  • R&D expenses rose 20.6% YoY to JPY364mn, and SG&A expenses increased 11.3% YoY to JPY3.2bn.

3 D Matrix Ltd (7777 JP): Q3 FY04/24 flash update

By Shared Research

  • Operating revenue grew 91.5% YoY to JPY3.0bn, driven by significant sales increases in the US and Japan.
  • Revised full-year FY04/24 forecast: Operating revenue JPY4.1bn, operating loss JPY1.9bn, recurring loss JPY743mn, net loss JPY1.0bn.
  • Cost of sales increased 44.2% YoY to JPY1.0bn, with R&D expenses up 20.6% YoY to JPY364mn.

3 D Matrix Ltd (7777 JP): Q3 FY04/24 flash update

By Shared Research

  • Operating revenue grew 91.5% YoY to JPY3.0bn, driven by significant sales increases in the US and Japan.
  • Operating loss narrowed by JPY720mn YoY to JPY1.6bn, with recurring loss at JPY336mn and net loss at JPY700mn.
  • Revised FY04/24 forecast: Operating revenue JPY4.1bn, operating loss JPY1.9bn, recurring loss JPY743mn, net loss JPY1.0bn.

3 D Matrix Ltd (7777 JP): A second revision to the earnings forecast

By Shared Research

  • In full-year FY04/23, the company reported consolidated operating revenue of JPY2.3bn (+53.6% YoY), an operating loss of JPY3.2bn (versus loss of JPY2.7bn in FY04/22), a recurring loss of JPY2.4bn (versus loss of JPY1.8bn in FY04/22), and a net loss attributable to owners of the parent of JPY2.4bn (versus net loss of JPY1.9bn in FY04/22).
  • Operating revenue grew on sales expansion of mainstay products in Japan and overseas.
  • However, the operating loss expanded, because overseas sales were not enough to offset upfront investment in establishing a direct sales structure.  The company’s full-year FY04/24 forecast (revised in June 2024 for the second time) calls for operating revenue of JPY4.6bn (previous forecast: JPY4.1bn), an operating loss of JPY2.1bn (previous forecast: a JPY1.9bn loss), a recurring profit of JPY140mn (previous forecast: a JPY743mn loss), and a net loss attributable to owners of the parent of JPY255mn (previous forecast: a JPY1.0bn loss). While revenue, mainly in the US, exceeded the previous estimates, costs on a foreign currency basis increased and profitability declined in Europe and Australia, due to the yen’s depreciation.

3 D Matrix Ltd (7777 JP): Q3 FY04/24 flash update

By Shared Research

  • Operating revenue grew 91.5% YoY to JPY3.0bn, driven by significant sales increases in the US and Japan.
  • The company revised its full-year FY04/24 forecast: operating revenue to JPY4.1bn, operating loss to JPY1.9bn.
  • Foreign exchange gains of JPY1.3bn and an extraordinary loss of JPY199mn due to remittance fraud were recorded.

3 D Matrix Ltd (7777 JP): Q3 FY04/24 flash update

By Shared Research

  • Operating revenue grew 91.5% YoY to JPY3.0bn, driven by significant sales increases in the US and Japan.
  • The company revised its full-year FY04/24 forecast, increasing operating revenue to JPY4.1bn and recurring loss to JPY743mn.
  • Foreign exchange gains and extraordinary loss due to remittance fraud impacted financial results, narrowing recurring and net losses.

3 D Matrix Ltd (7777 JP): Q3 FY04/24 flash update

By Shared Research

  • Operating revenue grew 91.5% YoY to JPY3.0bn, with significant sales increases in the US and Japan.
  • Operating loss narrowed YoY to JPY1.6bn, driven by increased sales and foreign exchange gains of JPY1.3bn.
  • Full-year FY04/24 forecast revised: operating revenue JPY4.1bn, operating loss JPY1.9bn, recurring loss JPY743mn, net loss JPY1.0bn.

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Jun 13
0

Daily Brief Quantitative Analysis: KRX Short Interest Weekly (Jun 7th): Samsung Electronics and more

By | Daily Briefs, Quantitative Analysis

In today’s briefing:

  • KRX Short Interest Weekly (Jun 7th): Samsung Electronics

KRX Short Interest Weekly (Jun 7th): Samsung Electronics

By Ke Yan, CFA, FRM

  • We analyzed the changes in short interest of KRX Stocks as of Jun 7th which has an aggregated short interest worth USD6.1bn.
  • We tabulate league table for top short by value and short as multiple of ADT, as well as weekly increases & decreases in short value, short as multiple of ADT.
  • We estimate short interest increased by 4.0% WoW and highlight short interest changes in Samsung Electronics.

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Jun 13
0

Daily Brief Thematic (Sector/Industry): In Court Today With Segantii and more

By | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

  • In Court Today With Segantii
  • Ohayo Japan | Inflation Cools…a Bit
  • Postcard from Uttar Pradesh | Addressing the Core
  • HK Strategy: What Are the Best-Of-The-Breed Stocks?
  • #13 India Insight: India’s Retail Inflation Eases, Tata Motors Guidance, Nestle Royalty, HCL Tech
  • Manila Trip Report – An emerging Pacific tiger? (Part 1)
  • [Blue Lotus Daily – TMT Update]:1024HK/BABA US/BIDU US/NTES US/700 HK
  • [Blue Lotus Daily]:300750 SZ/1211 HK/XPEV US/NIO US/1810 HK/LI US
  • Fewer Price Hikes in Spring, but Prices Still Rising
  • #17Business Buzz: BHP Averts Strike, UBS Market Concerns, EU Tariffs on Chinese EVs

In Court Today With Segantii

By David Blennerhassett

  • Although this note does not encapsulate a trade idea, the fallout from the Capital Management Limited’s (Segantii) insider dealing case has impacted certain event trades, as the fund winds down.
  • On the 2nd May, the SFC commenced criminal proceedings against Segantii, its founder/  director/CIO Simon Sadler, and former trader Daniel La Rocca.
  • In the Eastern Magistrates’ Court this morning, we heard the prosecution’s request to transfer the case to the District Court. 

Ohayo Japan | Inflation Cools…a Bit

By Mark Chadwick

  • US CPI remained flat over previous month and rose 3.3% over May last year – a slight deceleration
  • The Federal Reserve concluded its two-day policy meeting on Wednesday by keeping interest rates unchanged in the 5.25%-5.50% range
  • Japanese companies announced record share buybacks of ¥9 trillion ($57 billion) from January to May, up 60% from the previous year.

Postcard from Uttar Pradesh | Addressing the Core

By Pranav Bhavsar

  • With the “Postcard” series, our objective is to bring to our readers on-ground insights based on interactions across key channels located in tier 2 and tier 3 locations.
  • Uttar Pradesh (UP) is crucial in Indian politics with the most Lok Sabha seats and has a diverse economy focused on agriculture, services, and manufacturing.
  • We are trying to be optimists, but it’s hard to ignore the ground realities, especially when compared to a much less developed and smaller nation like Nepal. 

HK Strategy: What Are the Best-Of-The-Breed Stocks?

By Osbert Tang, CFA

#13 India Insight: India’s Retail Inflation Eases, Tata Motors Guidance, Nestle Royalty, HCL Tech

By Sudarshan Bhandari

  • Tata Motors Ltd (TTMT IN) and Dollar Industries guided for their upcoming years and expansion strategy.
  • India’s Retail Inflation eases to Lowest Since May 2022, now market is waiting for rate cut.
  • HCL Technologies (HCLT IN) to Establish Product Innovation Centre for Olympus in Hyderabad

Manila Trip Report – An emerging Pacific tiger? (Part 1)

By Pyramids and Pagodas

  • Initially planned around meeting a Chairman of an exciting listed company (to be covered separately), Altraman’s recent trip to Manila quickly morphed into a slew of meetings with other enterprises.
  • His first stop was the Philippines Stock Exchange (PSE.PS) – the holding company itself being a potential play on the market as a whole, where he learned of catalysts such as soaring fintech-driven retail investor participation and government reforms to slash transaction costs.
  • Further afield in Quezon, Altraman met with D&L Industries (DNL.PS), a raw materials manufacturer serving many of the country’s blue chips and multinationals. 

[Blue Lotus Daily – TMT Update]:1024HK/BABA US/BIDU US/NTES US/700 HK

By Ying Pan

  • 1024HK:  Kuaishou has launched its AI video generation tool “Kling” and has begun invite-only testing.(+)
  • BABA US/BIDU US: Alibaba publishes GPT-4 level AI LLM model Qwen2 (+/-)
  • NTES US:NetEase announced that <World of Warcraft Classic> will begin a public server stress test on June 11th. The Blizzard platform“Battle.net“has already opened for login today.(+)

[Blue Lotus Daily]:300750 SZ/1211 HK/XPEV US/NIO US/1810 HK/LI US

By Eric Wen

  • 300750 SZ: US lawmakers called to ban CATL and Gotion batteries to US.(+)
  • 1211 HK/XPEV US/NIO US/1810 HK:BYD’s two models equipped with DM-5 exceeded 80,000 pre-order in two weeks.(//-/-/-)
  • LI US/XPEV US/NIO US/1810 HK: /In the 23rd week of 2024, LI’s electric vehicle deliveries is leading the way, but most of them have fallen back.(///////)

Fewer Price Hikes in Spring, but Prices Still Rising

By Michael Causton

  • April, which along with October is the month when many Japanese FMCG brands adjust prices, saw far fewer price hikes this year compared to 2023. 
  • Even so, numerous major brands still announced hefty price increases for later in the year.
  • Meanwhile, government subsidies for utility costs are ending and the weak Yen is an increasing concern for many consumer-facing companies. 

#17Business Buzz: BHP Averts Strike, UBS Market Concerns, EU Tariffs on Chinese EVs

By Nimish Maheshwari

  • UBS merger with Credit Suisse sparks concerns over reduced competition and higher financing costs
  • EU announces tariffs on Chinese electric vehicles, risking trade tensions with China
  • Preliminary wage deal at BHP’s Spence copper mine averts potential costly strike

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Jun 13
0

Daily Brief ECM: Mao Geping Cosmetics Pre-IPO – Riding on the Founder’s Reputation and more

By | Daily Briefs, ECM

In today’s briefing:

  • Mao Geping Cosmetics Pre-IPO – Riding on the Founder’s Reputation
  • QuantumPharm IPO Trading – Lukewarm Insti Demand Combined with a Tight Float at Listing
  • Medtide Pre-IPO Tearsheet
  • Telix Pharmaceutical US ADS – Momentum Remains Strong, Offering Would Triple Its Cash Base

Mao Geping Cosmetics Pre-IPO – Riding on the Founder’s Reputation

By Sumeet Singh

  • Mao Geping Cosmetics is looking to raise around US$300m in its upcoming Hong Kong IPO.
  • Mao Geping Cosmetics (MGC) operates in the premium beauty segment. Operating via its two brands, MAOGEPING and Love Keeps, MGC offers a wide range of color cosmetics and skincare products.
  • In this note, we look at the company’s past performance.

QuantumPharm IPO Trading – Lukewarm Insti Demand Combined with a Tight Float at Listing

By Clarence Chu

  • QuantumPharm (QUP HK) raised US$126m from its Hong Kong IPO.
  • QuantumPharm is a R&D platform, utilizing quantum physics-based first-principles calculation, advanced AI, high-performance cloud computing, and scalable and standardized robotic automation to provide drug and material science R&D solutions.
  • We have covered various aspects of the deal in our previous note. In this note, we will talk about the demand and trading dynamics.

Medtide Pre-IPO Tearsheet

By Ethan Aw

  • Medtide (1268709D CH) is looking to raise at least US$100m in its upcoming HK IPO. The deal will be run by Morgan Stanley and Citic Securities.
  • Medtide is the third largest peptide-focused contract research, development and manufacturing organization (CRDMO) worldwide in terms of sales revenue in 2023, according to F&S. 
  • Its full-cycle services range from early-stage discovery, pre-clinical research and clinical development to commercial-stage production.

Telix Pharmaceutical US ADS – Momentum Remains Strong, Offering Would Triple Its Cash Base

By Clarence Chu

  • Telix Pharmaceuticals (TLX AU) is looking to raise around US$190m in its US ADS listing. The bookrunners on the deal are Jefferies, Morgan Stanley, Truist Securities, and William Blair.
  • TLX is a commercial-stage biopharmaceutical company focused on the development and commercialization of therapeutic and diagnostic radiopharmaceuticals.
  • In this note, we talk about the updates since our last note and current deal dynamics.

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Jun 13
0

Daily Brief Credit: Morning Views Asia: Nickel Industries and more

By | Credit, Daily Briefs

In today’s briefing:

  • Morning Views Asia: Nickel Industries , Road King Infrastructure, Yankuang Energy Group

Morning Views Asia: Nickel Industries , Road King Infrastructure, Yankuang Energy Group

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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Jun 13
0

Daily Brief Event-Driven: Helios Techno Holding (6927) TOB – Today Could Be The Day and more

By | Daily Briefs, Event-Driven

In today’s briefing:

  • Helios Techno Holding (6927) TOB – Today Could Be The Day
  • Tatsuta Electric (5809 JP) Crunch Time = Bump Time?
  • Tatsuta Electric (5809 JP): Eneos Finally Secures SAMR Approval but Needs to Bump
  • A8 New Media (800 HK): A Scheme with a 162% Takeover Premium
  • Proposed Merger Between Rebellions and Sapeon – To Challenge Nvidia
  • Quiddity Leaderboard NIFTY Sep 24: Multiple Changes Possible for NIFTY 50; Some New Trade Ideas
  • Changes in Law for Allocation of Treasury Shares as New Shares Post Spin-Offs in Korea in 2H 2024
  • NIFTY NEXT50 Index Rebalance Preview: Active Meets Passive
  • A8 Media (800 HK): A 163% Premium to Undisturbed? Yes Please.

Helios Techno Holding (6927) TOB – Today Could Be The Day

By Travis Lundy

  • Rs Technologies (3445 JP) announced a TOB on Helios Techno Holding (6927 JP) 12 days ago. At a 74% premium, but that was too cheap. I discussed it here.
  • Shares went limit up for two days then traded huge volume the first full day last Wednesday. The lowest trade so far in open trading is 3% through terms.
  • 57% of Shares Out Ex-Treasury have traded in five days. Anyone who bought 5% on Day 1 has to file a Large Shareholder Report today.

Tatsuta Electric (5809 JP) Crunch Time = Bump Time?

By Travis Lundy

  • ENEOS Holdings (5020 JP) announced a deal to buy out their affiliate Tatsuta Electric Wire & Cable (5809 JP) 18 months ago. The TOB was expected to start June 2023.
  • June 2023 came around and China’s SAMR still hadn’t approved. ENEOS provided quarterly updates in Sep and Dec and monthly updates since. The May update was different. 
  • The May update cut the “re-update” schedule to mid-month June. There are reasons to look at what has changed since the Dec 2022 announcement. 

Tatsuta Electric (5809 JP): Eneos Finally Secures SAMR Approval but Needs to Bump

By Arun George

  • 18 months after announcing the offer, ENEOS Holdings (5020 JP) secured SAMR approval for the Tatsuta Electric Wire & Cable (5809 JP) tender offer at JPY720 per share.   
  • The tender offer is expected to be launched on 21 June, subject to securing the recommendation from the special committee and the Board.
  • A bump is required due to the material market rerating since 21 December 2022. An offer of JPY828, a 15.1% premium to the current offer, implies a P/B of 1x.  

A8 New Media (800 HK): A Scheme with a 162% Takeover Premium

By Arun George

  • A8 New Media (800 HK) disclosed a Cayman scheme privatisation offer from Mr Liu Xiaosong (Founder, Chairman, CEO) at HK$0.36 per share, a 162.8% premium to the last close price. 
  • The massive premium is unsurprising, as A8’s EV has been negative since April 2023 due to headwinds from the weak Chinese leasing sector and uncertainty about cash use.  
  • The high takeover premium, no shareholder holding a blocking stake, and low AGM minority participation rate point to a done deal. However, this is a small-cap illiquid stock.  

Proposed Merger Between Rebellions and Sapeon – To Challenge Nvidia

By Douglas Kim

  • On 12 June, SK Telecom (017670 KS) confirmed that its affiliate Sapeon plans to merge with its competitor Rebellions by end of this year.
  • Sapeon and Rebellions’ largest global competitor is Nvidia. A key aim of the merger is to challenge Nvidia and try to take away its global dominance in AI chips.
  • If the combined Sapeon and Rebellion can take away just 1% market share resulting in 1% of Nvidia’s market cap, this would suggest valuation of US$31 billion.

Quiddity Leaderboard NIFTY Sep 24: Multiple Changes Possible for NIFTY 50; Some New Trade Ideas

By Janaghan Jeyakumar, CFA

  • NIFTY 50 represents the 50 largest stocks listed in the National Stock Exchange (NSE) of India and the NIFTY Next 50 index tracks the next 50 largest names.
  • In this insight, we take a look at the names leading the race to become ADDs/DELs during the September 2024 index rebal event.
  • Since my last insight, we have observed a couple of important changes to candidate rankings and that has resulted in some changes to our index change expectations.

Changes in Law for Allocation of Treasury Shares as New Shares Post Spin-Offs in Korea in 2H 2024

By Douglas Kim

  • On 11 June, the FSC announced that the restrictions on allocation of treasury shares as new shares post spin-offs is expected to be made into law in 2H 2024.
  • Meanwhile, starting 1 July, the financial regulators will make it more difficult for Korean companies to conduct spin-offs that have separate allocation of treasury shares as new shares.
  • The top five stocks with highest percentage of treasury shares/outstanding shares are up on average 40.5% YTD. 

NIFTY NEXT50 Index Rebalance Preview: Active Meets Passive

By Brian Freitas

  • With a substantial part of the review period complete, there could potentially be 7 changes for the NSE Nifty Next 50 Index (NIFTYJR INDEX) in September.
  • Estimated one-way turnover is 17.7% resulting in a one-way trade of INR 47.2bn (US$566m). 8 stocks will have over 1x ADV to trade from passive trackers.
  • There are a bunch of stocks that are potential migrations between Mid Cap and Large Cap segments in the AMFI Classification system and there will be flows from active managers.

A8 Media (800 HK): A 163% Premium to Undisturbed? Yes Please.

By David Blennerhassett

  • Following a suspension on the 28th May, property rental play A8 New Media (800 HK) has now announced an Offer by way of a Scheme from chairman/founder/major shareholder Liu Xiaosong.
  • The Cancellation price is $0.36, a whopping 162.77% to last close. The price is final.
  • This is a done deal. But A8 is an illiquid micro cap. 

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Jun 13
0

Daily Brief Equity Bottom-Up: Reliance’s Next Mega Industrial Hub: The Rise of Navi Mumbai and more

By | Daily Briefs, Equity Bottom-Up

In today’s briefing:

  • Reliance’s Next Mega Industrial Hub: The Rise of Navi Mumbai
  • Transsion (688036 CH): Global No. 4 Smartphone Producer, Revenue Up by 88% YoY in 1Q24
  • Coal Is Back – The Real Inconvenient Truth
  • Tech Supply Chain Tracker (13-Jun-2024): Sony aims for profit in car camera biz by 2026.
  • Beijing Capital International Airport: On Track to Break Even
  • i-mobile Co Ltd (6535 JP): Q3 FY07/24 flash update
  • Ballys Corp (BALY) – Wednesday, Mar 13, 2024
  • Jiangsu Hengrui Medicine (600276.CH) – More Downside Ahead; The Long Logic Doesn’t Exist
  • CRE Inc/Japan (3458 JP): Q3 FY07/24 flash update
  • Cal-Maine Foods Inc (CALM) – Wednesday, Mar 13, 2024

Reliance’s Next Mega Industrial Hub: The Rise of Navi Mumbai

By Sudarshan Bhandari

  • Reliance Industries (RIL IN) is developing a new integrated industrial area in Navi Mumbai, part of a global economic hub.
  • This project, supported by a 43-year land lease and strategic partnerships, aims to attract global companies, fostering innovation and economic growth in the Fourth Industrial Revolution.
  • Reliance’s initiative will significantly boost Navi Mumbai’s attractiveness as an investment destination, driving regional economic growth and employment opportunities.

Transsion (688036 CH): Global No. 4 Smartphone Producer, Revenue Up by 88% YoY in 1Q24

By Ming Lu

  • Transsion is the global No. 4 largest smartphone producer according to IDC.
  • In 1Q24, shipments increased by 34% YoY and revenue increased by 88% YoY.
  • We see the stock’s upside at 17% and the price target at RMB100.00.

Coal Is Back – The Real Inconvenient Truth

By Rikki Malik

  • Increased demand from power plants under construction outside  G-7 countries
  • There is constrained supply as with many other fossil fuels
  • We look at a basket of coal stocks with good balance sheets and increasing production

Tech Supply Chain Tracker (13-Jun-2024): Sony aims for profit in car camera biz by 2026.

By Tech Supply Chain Tracker

  • Sony plans to achieve profitability in car camera business by 2026, aiming for 6x growth in the sector.
  • Samsung cancels anniversary events to focus on new management plan in response to crisis within the company.
  • Taiwan’s passive component makers like Yageo and Ample flourish in AI boom, indicating growth potential in semiconductor industry.

Beijing Capital International Airport: On Track to Break Even

By Eric Chen

  • The worst is behind Beijing Capital International Airport. We believe it is on track to achieve breakeven on quarterly basis in 2H24.
  • We see recent parking fee hikes at Daxing Airport as a signal that more will come, which is not in the price and can bring in extra option value.
  • Boom-And-Bust in China property sector is behind the airport’s share price cycle. The airport is at the cusp of a steady recovery driving mean reversion of valuation .

i-mobile Co Ltd (6535 JP): Q3 FY07/24 flash update

By Shared Research

  • i-mobile reported cumulative Q3 FY07/24 revenue of JPY16.3bn (+14.3% YoY), operating profit of JPY3.7bn (+9.2% YoY).
  • Consumer Service business cumulative Q3 revenue was JPY14.2bn (+19.4% YoY), with segment profit of JPY3.5bn (+18.9% YoY).
  • Online Advertising business cumulative Q3 revenue was JPY2.1bn (-11.8% YoY), with segment profit of JPY316mn (-39.3% YoY).

Ballys Corp (BALY) – Wednesday, Mar 13, 2024

By Value Investors Club

  • Bally’s Corporation is undervalued despite insiders recognizing its potential
  • Standard General made a buyout offer of $15/share, prompting Bally’s to form a special committee
  • The author predicts that Standard General will increase their bid to take Bally’s private, highlighting it as a compelling investment opportunity.

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.

Jiangsu Hengrui Medicine (600276.CH) – More Downside Ahead; The Long Logic Doesn’t Exist

By Xinyao (Criss) Wang

  • Around RMB5 billion generic drugs would be included in VBP in 2024/2025 (e.g. sevoflurane/Ioversol/butorphanol tartrate). So, the assumption that all the negative effects of VBP have cleared up isn’t correct.
  • Hengrui’s innovative drugs would lose growth momentum after they reach peak sales. It’s difficult for Hengrui to maintain its scale expansion or achieve the over 20% YoY revenue growth.
  • Hengrui’s PE would fall below 30 (or even below 20) in the future, which means its valuation would start to enter a downward trend. Current high valuation cannot be justified.

CRE Inc/Japan (3458 JP): Q3 FY07/24 flash update

By Shared Research

  • In cumulative Q3 FY07/24, the company reported sales of JPY30.2bn (-30.0% YoY) and business profit of JPY1.3bn (-80.8% YoY).
  • Sales from recurring revenue businesses declined 2.8% YoY to JPY18.3bn, with segment profit falling 7.3% YoY to JPY1.9bn.
  • The company revised its FY07/24 year-end dividend forecast to JPY50.00 per share, including a special dividend of JPY24.00.

Cal-Maine Foods Inc (CALM) – Wednesday, Mar 13, 2024

By Value Investors Club

  • Cal-Maine Foods (CALM) is a promising long-term investment with potential for around 50% upside
  • Stock is currently undervalued due to low historical book multiples and high short interest
  • Company has a cost advantage over peers and strong earnings potential, especially in the event of an avian flu outbreak

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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Jun 13
0

Daily Brief Macro: US CPI Inflation 3.27% y-o-y (consensus 3.4%) in May-24 and more

By | Daily Briefs, Macro

In today’s briefing:

  • US CPI Inflation 3.27% y-o-y (consensus 3.4%) in May-24
  • CX Daily: Turning Research Into Revenue – China’s Quest to Bring Lab Inventions to Market
  • Iron Ore: Disappointing Data Pushed Price Down to 105, Bounce To 120 On Further Stimulus From China
  • UK: Structural Trend Imputation
  • EM Watch: Is China making a fool out of Western metals speculants?
  • Thailand Policy Rate 2.5% (consensus 2.5%) in Jun-24
  • US CPI Review – Admittedly a soft report, but NOT the new normal
  • India CPI Inflation 4.75% y-o-y (consensus 4.9%) in May-24
  • China CPI 0.3% y-o-y (consensus 0.4%) in May-24

US CPI Inflation 3.27% y-o-y (consensus 3.4%) in May-24

By Heteronomics AI

  • US CPI inflation for May 2024 was reported at 3.27% year-on-year, the lowest growth rate since February 2024, and slightly below the consensus estimate and the previous month’s figure.
  • Despite a decrease in headline inflation, core CPI inflation remained stable at 3.4% year-on-year.
  • This stability in core CPI inflation is due to persistent producer price pressures, indicating sustained underlying inflationary pressures.
This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

CX Daily: Turning Research Into Revenue – China’s Quest to Bring Lab Inventions to Market

By Caixin Global

  • Cover Story: Turning research into revenue – China’s quest to bring lab inventions to market
  • Peru amends law allowing Cosco Shipping to retain exclusive rights to operate Chancay Port
  • In Depth: How Hong Kong could help craft mainland policies for digital assets

Iron Ore: Disappointing Data Pushed Price Down to 105, Bounce To 120 On Further Stimulus From China

By Sameer Taneja

  • Iron ore continued to operate in its band from 95-130 USD/ton over the last few years, with a recent drop from 120 USD/ton to 105 USD/ton on tepid China data.
  • With incremental news on China’s stimulus in the property and infrastructure sectors, we remain confident that iron ore will return to 120 USD/ton in the short term. 
  • We also remain bullish on the 65-62 spread, which has expanded to the teens. Rio Tinto Ltd (RIO AU) and Vale (VALE US)  are good plays on the spread.

UK: Structural Trend Imputation

By Phil Rush

  • Sustaining the Q1 rebound in April suggests economic trends have improved in 2024 to about 0.3% q-o-q for demand and 0.4% for supply amid slightly rising unemployment.
  • The fading positive supply shock from falling energy prices should slow those trends before policy aligns at neutral such that both trends converge at 0.3% q-o-q in 2025.
  • Easing before expectations have re-anchored with the target risks excessively high inflation, compounding the UK risk of rates reversing higher relative to other countries.

EM Watch: Is China making a fool out of Western metals speculants?

By Andreas Steno

  • Hot on the heels of watching Powell’s press conference, which pushed back slightly against renewed rate-cut optimism, it’s clear that the Fed is playing a cautious game.
  • Despite the soft inflation data this morning, they significantly changed the dot plot.
  • They likely believe the CPI report was noisy due to a sudden deflation in transportation.

Thailand Policy Rate 2.5% (consensus 2.5%) in Jun-24

By Heteronomics AI

  • The Bank of Thailand maintained its Policy Rate at 2.5%, with a 6 to 1 vote, reflecting a cautious approach amid structural challenges and ongoing economic uncertainties, particularly in the export sector.
  • It projects economic growth at 2.6% in 2024 and 3.0% in 2025, driven by strong domestic demand, tourism recovery, and accelerated government disbursements, while structural impediments continue to weigh on export performance.
  • Inflation should gradually increase towards the target range by the fourth quarter of 2024, with headline inflation projected at 0.6% for 2024 and 1.3% for 2025, necessitating careful monitoring of external and domestic factors that could influence inflation dynamics and future policy decisions.
This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

US CPI Review – Admittedly a soft report, but NOT the new normal

By Andreas Steno

  • The CPI report today was admittedly softer than our initial hawkish forecasts, with headline coming in unchanged at 0.0% MoM vs 0.1% expected while core came in to the soft side of 0.2% MoM vs 0.3% expected.
  • Our anticipation of rising goods-flation didn’t play out fully, and while shelter re-accelerated as we forecasted, core services disinflated heavily in May due to auto insurance costs declining.
  • The main culprit behind the dovish CPI report was the sudden drop in Motor Vehicle Insurance (chart 2.b), which has so far been printing at trend MoM levels around 1-1.5%, lifting headline inflation by 0.03-0.05% consecutively.

India CPI Inflation 4.75% y-o-y (consensus 4.9%) in May-24

By Heteronomics AI

  • India’s CPI inflation for May 2024 was 4.75% year-on-year, lower than the predicted 4.9%, and the lowest since May 2023.
  • There has been a slowdown in CPI inflation and subdued wholesale price movements, especially in the manufacturing sector.
  • This suggests a potential easing of inflationary pressures, which could provide economic relief and lead to adjustments in monetary policy.
This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

China CPI 0.3% y-o-y (consensus 0.4%) in May-24

By Heteronomics AI

  • China’s CPI remained stable at 0.3% year-on-year in May 2024, indicating modest inflationary pressures.
  • Despite this stability, the CPI was slightly above the one-year average.
  • Other economic indicators, such as declining new house prices and robust monetary and credit growth, suggest potential future inflationary dynamics.
This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

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Jun 13
0

Daily Brief Australia: Telix Pharmaceuticals, Iron Ore, Road King Infrastructure and more

By | Australia, Daily Briefs

In today’s briefing:

  • Telix Pharmaceutical US ADS – Momentum Remains Strong, Offering Would Triple Its Cash Base
  • Iron Ore: Disappointing Data Pushed Price Down to 105, Bounce To 120 On Further Stimulus From China
  • Morning Views Asia: Nickel Industries , Road King Infrastructure, Yankuang Energy Group

Telix Pharmaceutical US ADS – Momentum Remains Strong, Offering Would Triple Its Cash Base

By Clarence Chu

  • Telix Pharmaceuticals (TLX AU) is looking to raise around US$190m in its US ADS listing. The bookrunners on the deal are Jefferies, Morgan Stanley, Truist Securities, and William Blair.
  • TLX is a commercial-stage biopharmaceutical company focused on the development and commercialization of therapeutic and diagnostic radiopharmaceuticals.
  • In this note, we talk about the updates since our last note and current deal dynamics.

Iron Ore: Disappointing Data Pushed Price Down to 105, Bounce To 120 On Further Stimulus From China

By Sameer Taneja

  • Iron ore continued to operate in its band from 95-130 USD/ton over the last few years, with a recent drop from 120 USD/ton to 105 USD/ton on tepid China data.
  • With incremental news on China’s stimulus in the property and infrastructure sectors, we remain confident that iron ore will return to 120 USD/ton in the short term. 
  • We also remain bullish on the 65-62 spread, which has expanded to the teens. Rio Tinto Ltd (RIO AU) and Vale (VALE US)  are good plays on the spread.

Morning Views Asia: Nickel Industries , Road King Infrastructure, Yankuang Energy Group

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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