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Smartkarma Daily Briefs

Dec 23
0

Daily Brief United States: Micron Technology, NFT and more

By | Daily Briefs, United States

In today’s briefing:

  • Micron Analysis, Industry Takeaways: Memory Market TAM New Highs into 2025; SK Hynix Trade
  • Michael Lee – In Focus: The Market for Rare Photos – [Making Markets, EP.9]

Micron Analysis, Industry Takeaways: Memory Market TAM New Highs into 2025; SK Hynix Trade

By Vincent Fernando, CFA

  • Relative Value Trade in Micron Has Worked Since Our Last Piece; Results Blow Away Expectations
  • Memory Pricing Improvement Continues, Management Expects Pricing Increases Through Calendar Year 2024 and 2025
  • We Remain Structurally Long Memory; Now See Relative Value in SK Hynix

Michael Lee – In Focus: The Market for Rare Photos – [Making Markets, EP.9]

By Web3 Breakdowns

  • The guest on the show is Michael Lee, a dealer in rare photographs and the director of the Lee Gallery.
  • The discussion explores the differences between the primary and secondary markets in art, as well as the challenges of finding liquidity and pricing inventory.
  • Michael shares his views on NFTs and explains the capital-intensive nature of being a secondary market dealer in the art industry.

This podcast is sourced from an online content aggregator through publicly available sources and is displayed below for general informational purposes only.

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Dec 23
0

Daily Brief Japan: MARUKA FURUSATO and more

By | Daily Briefs, Japan

In today’s briefing:

  • 3Q Follow-Up – MARUKA FURUSATO Corporation (7128 JP)

3Q Follow-Up – MARUKA FURUSATO Corporation (7128 JP)

By Sessa Investment Research

  • The Medium-Term Management Plan UNISOL includes the following FY26/12 targets, net sales of ¥200.0 bn, operating profit of ¥10.0 bn, and ROE of 8.5%.
  • MARUKA FURUSATO will enter the 2nd stage of the plan, a period of accelerated growth, starting in FY24/12. During the 1st stage of the plan, which was centered on establishing a base, various initiatives were undertaken.
  • The company promoted cross sales and expanded rebates through commercial flow integration, starting with streamlining administration departments, which included merging offices. 

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Dec 23
0

Daily Brief China: Tencent and more

By | China, Daily Briefs

In today’s briefing:

  • China Gaming Restrictions 2.0

China Gaming Restrictions 2.0

By Mio Kato

  • China has tightened restrictions on online games again driving significant falls in names such as Tencent and NetEase. 
  • While the move may surprise some given prior moves to restart approvals in our view the overall trend of regulation is not especially surprising. 
  • In particular, the tightened regulations appear to target the most important drivers of mobile gaming profitability and today’s large drops may actually be underreactions.

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Dec 23
0

Daily Brief Crypto: Michael Lee – In Focus: The Market for Rare Photos – [Making Markets and more

By | Crypto, Daily Briefs

In today’s briefing:

  • Michael Lee – In Focus: The Market for Rare Photos – [Making Markets, EP.9]

Michael Lee – In Focus: The Market for Rare Photos – [Making Markets, EP.9]

By Web3 Breakdowns

  • The guest on the show is Michael Lee, a dealer in rare photographs and the director of the Lee Gallery.
  • The discussion explores the differences between the primary and secondary markets in art, as well as the challenges of finding liquidity and pricing inventory.
  • Michael shares his views on NFTs and explains the capital-intensive nature of being a secondary market dealer in the art industry.

This podcast is sourced from an online content aggregator through publicly available sources and is displayed below for general informational purposes only.

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Dec 23
0

Daily Brief Macro: Portfolio Watch – 2023 in hindsight and more

By | Daily Briefs, Macro

In today’s briefing:

  • Portfolio Watch – 2023 in hindsight
  • NEW EU FISCAL RULES – Victory for the Expansionists or the Prudentials?

Portfolio Watch – 2023 in hindsight

By Andreas Steno

  • Merry Christmas and a happy new year to all of you from us here at Steno Research.
  • What a year it has been, and we hope you have enjoyed the portfolio, trade alerts and our weekly portfolio updates, where we as always try to give you an edge and insight in what we are doing with our money.
  • For those of you who have been listening to our ‘Macro Sunday’ podcast, it’s no secret that our trades are “sometimes maybe good sometimes maybe shit”, but our equal-weighted alpha overlay portfolio has since inception in May 2023 delivered a very decent return of around 5% with very little drawdowns of at max 3-4% (compared to 8-10% for S&P 500 as an example) and with a market beta of 0.15 (based on a simple linear regression).

NEW EU FISCAL RULES – Victory for the Expansionists or the Prudentials?

By Anne Sandager

  • Amidst the prospect of a soft landing and lower interest rates, the European Council unanimously voted in favor of reinstating fiscal safeguards for EU member states after a 4-year pause during the pandemic.
  • The Stability and Growth Pact – the formal name of the fiscal rulebook – gives the EU the ability to impose monetary fines on member states with debt-to-GDP ratios above 60% and/or budget deficits exceeding -3%.
  • The pact was temporarily waived to allow states to undertake counter-cyclical investments and debt intake during the pandemic and subsequent energy crisis.

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Dec 22
0

Daily Brief Energy/Materials: Hanwha Corporation and more

By | Daily Briefs, Energy & Materials Sector

In today’s briefing:

  • StubWorld: Hanwha Corp Is “Cheap”

StubWorld: Hanwha Corp Is “Cheap”

By David Blennerhassett

  • A double dose of StubWorld this week as Hanwha Corporation (000880 KS) comes up “cheap” on my monitor.
  • Preceding my comments on Hanwha are the current setup/unwind tables for Asia-Pacific Holdcos.
  • These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation >20%.

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Dec 22
0

Daily Brief Industrials: Benefit One Inc, Pasona Group, Cosco Shipping Energy Transportation Co. Ltd. (H), Airports of Thailand, MillerKnoll and more

By | Daily Briefs, Industrials

In today’s briefing:

  • Dai-Ichi Life “Decides” Tender Offer Price and Buyback Price at ¥2,123 and ¥1,491/Share
  • Benefit One (2412 JP): Dai-Ichi Life’s Tender Offer at JPY2,123
  • Buy Pasona As Dai-Ichi Life Amends Benefit One’s Tender Offer & Buyback Price
  • COSCO Shipping Energy (1138 HK): Time for Another Look
  • AOT Vs MAHB: Part Deux
  • MillerKnoll, Inc. – 2QFY24 Results Deliver Strong Margins; Orders Challenged

Dai-Ichi Life “Decides” Tender Offer Price and Buyback Price at ¥2,123 and ¥1,491/Share

By Travis Lundy

  • Today, Dai Ichi Life Insurance (8750 JP) came out with a cover letter and an amended Announcement of Intention to Commence a Tender Offer on Benefit One Inc (2412 JP). 
  • The cover letter says they have obtained information from Pasona Group (2168 JP) and Benefit One allowing them to calculate a Tender Offer of ¥2,123/share for minorities, and buyback at ¥1,491/share. 
  • Now we wait. Again. Dai-Ichi Life “intends” to start a tender in mid-Jan 2024 (19 Jan likely earliest start possible) but it is not clear timing will come that early.

Benefit One (2412 JP): Dai-Ichi Life’s Tender Offer at JPY2,123

By Arun George

  • Dai Ichi Life Insurance (8750 JP)‘s pre-conditional tender offer for Benefit One Inc (2412 JP) is JPY2,123 per share, a 32.7% premium to M3 Inc (2413 JP)’s offer.
  • The other terms are unchanged. The pre-conditions relate to board recommendation, Pasona Group (2168 JP) support, and the M3 offer not being completed. The tender offer starts in mid-January 2024.
  • While M3 has extended its offer period to 17 January 2024, it will unlikely engage in a bidding war. Expect the Board and Pasona to support the Dai-ichi Life proposal.

Buy Pasona As Dai-Ichi Life Amends Benefit One’s Tender Offer & Buyback Price

By David Blennerhassett

  • Earlier this month, Dai Ichi Life (8750 JP) countered M3 with an unsolicited ¥1,800/share Offer of Equity Value TOB; followed by a Benefit One buyback to mop up Pasona‘s stake.
  • Dai-Ichi has now amended the TOB Price for minorities in Benefit One to ¥2,123/share, and the tax-equivalent price of ¥1,800/share for Pasona would be ¥1,491 on the Buyback Tender, post-squeezeout.
  • That price appears a bit higher for Pasona than expected, and therefore a bit lower for Benefit One minorities. Terms can still be bumped.

COSCO Shipping Energy (1138 HK): Time for Another Look

By Osbert Tang, CFA

  • The 20% retreat in the share price of Cosco Shipping Energy Transportation (1138 HK) from the peak has well reflected the plunge in 3Q23 VLCC rates and 10% earnings downgrade.
  • 4Q23 VLCC rates have rebounded 78.4% QoQ. Re-routing due to recent Houthi attacks on commercial ships at the Red Sea has reduced effective supply and is positive to rates.
  • Heightened energy security needs will drive demand. The medium-term supply pressure is mild as the VLCC orderbook equals just 2% of the existing fleet, fueling ROE for FY23-25F. 

AOT Vs MAHB: Part Deux

By Henry Soediarko

  • Airports of Thailand (AOT TB) 6m24 revenue growth rates are healthy, supported by the growth in departure passenger service charges and the coming back of concession revenues.
  • AOT labor expenses have expanded at an unprecedented level, even higher than pre-COVID levels, while Malaysia Airports Holdings (MAHB MK) kept them under control.
  • Book profit on half of the exposure and wait for the next quarter to see if AOT labor expenses will stay high.

MillerKnoll, Inc. – 2QFY24 Results Deliver Strong Margins; Orders Challenged

By Water Tower Research

  • After market close on December 20, MillerKnoll reported 2QFY24 adjusted EPS of $0.59, ahead of our estimate of $0.55 and the consensus mean of $0.54.
  • Margins were better than expected, while revenue of $949.5 million came in at the low end of guidance.
  • Sales in the Americas segment disappointed relative to our expectations.

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Dec 22
0

Daily Brief TMT/Internet: Plover Bay Technologies, Posco DX, Intel Corp, UBTech Robotics, Telefonica SA, Japan System Techniques Co, Carta Holdings, Inc. and more

By | Daily Briefs, TMT/Internet

In today’s briefing:

  • Plover Bay (1523 HK): Interesting Net Cash /8% Dividend Yield Play/ With ROEs Above 50%
  • KOSDAQ150 Adhoc Index Rebalance: TEMC Added; Short Covering Expected in PoscoDX
  • Intel’s AI Everywhere In New York
  • UBTech Robotics IPO – Quick Thoughts on Valuation – Too Hefty a Premium for Slowing Growth
  • SEPI/Telefonica: Acquisition of a 10% Stake
  • 2Q Follow-Up – Japan System Techniques (4323 JP)
  • 3Q FOLLOW-UP – Carta Holdings (3688 JP)

Plover Bay (1523 HK): Interesting Net Cash /8% Dividend Yield Play/ With ROEs Above 50%

By Sameer Taneja

  • Plover Bay Technologies (1523 HK) is another exciting play from the stable of net cash (12% of market cap) and high dividend yield (8% FY22) companies.  
  • The company develops networking technologies that enable supercharged connectivity. Users can build always-on networks anywhere by combining fixed, mobile, and satellite connectivity. Its major brands are Peplink and Pepwave.
  • Plover Bay is a high net margin (25%) and high ROE (>50%) business that has 9-10% CAGR revenue growth (trading at 11x PE) with catalysts up ahead. 

KOSDAQ150 Adhoc Index Rebalance: TEMC Added; Short Covering Expected in PoscoDX

By Brian Freitas

Intel’s AI Everywhere In New York

By William Keating

  • Intel’s “AI Everywhere” event turned out to be little more than last minute launches client and server products promised for 2023
  • While these products have little new in the way of ground-breaking AI hardware, the entire event was infused with AI marketing to the highest degree
  • Ostensibly Intel’s great hope in AI hardware acceleration, Gaudi, featured solely as a last minute gimmick announcing that Gaudi3 was “out of the fab and into the lab”. Yawn!

UBTech Robotics IPO – Quick Thoughts on Valuation – Too Hefty a Premium for Slowing Growth

By Ethan Aw

  • UBTech Robotics (9880 HK) is looking to raise about US$168m in its upcoming HK IPO, after downsizing from an earlier reported float of up to US$700m.
  • UBTech Robotics is engaged in artificial intelligence (AI)-empowered robotics in China, dedicated to the innovation of humanoid robots and development and sales of smart service robotic solutions.
  • In our previous note, we looked at the company’s performance and its PHIP updates. In this note, we share our quick thoughts on valuation.

SEPI/Telefonica: Acquisition of a 10% Stake

By Jesus Rodriguez Aguilar

  • The Spanish Cabinet has agreed on the acquisition of up to 10% of the share capital of Telefonica SA (TEF SM) (c.€2.2 billion), higher than the 5% initially mentioned.
  • This should move the market as it represents 48 trading days. This also means that the Government will likely authorise the purchase of up to 9.9% by STC.
  • The Kingdom of Spain 10-y benchmark bond yield is 2.9%, while the 24e dividend yield of Telefonica is 8% (source: IBES), therefore the operation makes financial sense.

2Q Follow-Up – Japan System Techniques (4323 JP)

By Sessa Investment Research

  • Fully independent DX provider: Japan System Techniques (JAST) is an independent system integrator that develops and sells software and systems, which celebrated its 50th anniversary.
  • The company develops systems for customers in a variety of industries and sectors, including finance, manufacturing, distribution, services, public services, telecommunications, transportation, and science and technology.
  • Furthermore, as a developer, the company has three main JAST-branded software offerings for its customers, namely GAKUEN for the education industry, BankNeo for the financial industry, and JMICS (JAST Medical Insurance Checking System) for the medical industry and the profitability of these own-brand businesses is very high.

3Q FOLLOW-UP – Carta Holdings (3688 JP)

By Sessa Investment Research

  • In 2023, the first year of CARTA Holdings’ new medium-term management plan, the company made a solid push to reform its business and organizational structure with the aim of executing a sharp recovery in business performance.
  • It moved forward with narrowing its focus, integrating four direct sales subsidiaries in the digital marketing business, and withdrawing from the low-profit game and hometown tax payment business in the internet-related services business.
  • In addition, the company announced and implemented additional measures to reduce fixed costs to the tune of ¥1 bn, including by calling for voluntary retirement during FY23/12, as its earnings may fall further than initially expected before bottoming out, mainly for reservation-based ads. 

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Dec 22
0

Daily Brief Financials: Edelweiss Financial Services, China South City and more

By | Daily Briefs, Financials

In today’s briefing:

  • Edelweiss: Hitting All the Right Notes to Scale Up Businesses and Unlock Value
  • Weekly Wrap – 21 Dec 2023

Edelweiss: Hitting All the Right Notes to Scale Up Businesses and Unlock Value

By Ankit Agrawal, CFA

  • Edelweiss reported a decent Q2FY24 with ex-Insurance PAT of INR 153cr vs INR 133cr YoY. All the businesses – ARC, Asset Management and Credit – performed well.
  • Edelweiss is making decent progress in the Credit business aided by the co-lending business model. 80% of disbursals in NBFC and 30% in Housing Finance in Q2FY24 were through co-lending.
  • Edelweiss is in process of selling a minority stake in its Alternative Asset Management business for value unlocking. It plans to sell 10-20% equity stake for INR 1500-2000cr.

Weekly Wrap – 21 Dec 2023

By Charles Macgregor

Lucror Analytics Weekly Wraps provide an overview of all Morning Views comments and reports published by our analyst team in the past week, and also showcase a list of the most-read reports.

In this Insight:

  1. Meituan
  2. Lippo Malls Indonesia Retail Trust
  3. SK Hynix
  4. China Jinmao Holdings
  5. Geely Auto

and more…

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Dec 22
0

Daily Brief Industrials: Benefit One Inc, Pasona Group, Cosco Shipping Energy Transportation Co. Ltd. (H), Airports of Thailand, MillerKnoll and more

By | Daily Briefs, Industrials

In today’s briefing:

  • Dai-Ichi Life “Decides” Tender Offer Price and Buyback Price at ¥2,123 and ¥1,491/Share
  • Benefit One (2412 JP): Dai-Ichi Life’s Tender Offer at JPY2,123
  • Buy Pasona As Dai-Ichi Life Amends Benefit One’s Tender Offer & Buyback Price
  • COSCO Shipping Energy (1138 HK): Time for Another Look
  • AOT Vs MAHB: Part Deux
  • MillerKnoll, Inc. – 2QFY24 Results Deliver Strong Margins; Orders Challenged

Dai-Ichi Life “Decides” Tender Offer Price and Buyback Price at ¥2,123 and ¥1,491/Share

By Travis Lundy

  • Today, Dai Ichi Life Insurance (8750 JP) came out with a cover letter and an amended Announcement of Intention to Commence a Tender Offer on Benefit One Inc (2412 JP). 
  • The cover letter says they have obtained information from Pasona Group (2168 JP) and Benefit One allowing them to calculate a Tender Offer of ¥2,123/share for minorities, and buyback at ¥1,491/share. 
  • Now we wait. Again. Dai-Ichi Life “intends” to start a tender in mid-Jan 2024 (19 Jan likely earliest start possible) but it is not clear timing will come that early.

Benefit One (2412 JP): Dai-Ichi Life’s Tender Offer at JPY2,123

By Arun George

  • Dai Ichi Life Insurance (8750 JP)‘s pre-conditional tender offer for Benefit One Inc (2412 JP) is JPY2,123 per share, a 32.7% premium to M3 Inc (2413 JP)’s offer.
  • The other terms are unchanged. The pre-conditions relate to board recommendation, Pasona Group (2168 JP) support, and the M3 offer not being completed. The tender offer starts in mid-January 2024.
  • While M3 has extended its offer period to 17 January 2024, it will unlikely engage in a bidding war. Expect the Board and Pasona to support the Dai-ichi Life proposal.

Buy Pasona As Dai-Ichi Life Amends Benefit One’s Tender Offer & Buyback Price

By David Blennerhassett

  • Earlier this month, Dai Ichi Life (8750 JP) countered M3 with an unsolicited ¥1,800/share Offer of Equity Value TOB; followed by a Benefit One buyback to mop up Pasona‘s stake.
  • Dai-Ichi has now amended the TOB Price for minorities in Benefit One to ¥2,123/share, and the tax-equivalent price of ¥1,800/share for Pasona would be ¥1,491 on the Buyback Tender, post-squeezeout.
  • That price appears a bit higher for Pasona than expected, and therefore a bit lower for Benefit One minorities. Terms can still be bumped.

COSCO Shipping Energy (1138 HK): Time for Another Look

By Osbert Tang, CFA

  • The 20% retreat in the share price of Cosco Shipping Energy Transportation (1138 HK) from the peak has well reflected the plunge in 3Q23 VLCC rates and 10% earnings downgrade.
  • 4Q23 VLCC rates have rebounded 78.4% QoQ. Re-routing due to recent Houthi attacks on commercial ships at the Red Sea has reduced effective supply and is positive to rates.
  • Heightened energy security needs will drive demand. The medium-term supply pressure is mild as the VLCC orderbook equals just 2% of the existing fleet, fueling ROE for FY23-25F. 

AOT Vs MAHB: Part Deux

By Henry Soediarko

  • Airports of Thailand (AOT TB) 6m24 revenue growth rates are healthy, supported by the growth in departure passenger service charges and the coming back of concession revenues.
  • AOT labor expenses have expanded at an unprecedented level, even higher than pre-COVID levels, while Malaysia Airports Holdings (MAHB MK) kept them under control.
  • Book profit on half of the exposure and wait for the next quarter to see if AOT labor expenses will stay high.

MillerKnoll, Inc. – 2QFY24 Results Deliver Strong Margins; Orders Challenged

By Water Tower Research

  • After market close on December 20, MillerKnoll reported 2QFY24 adjusted EPS of $0.59, ahead of our estimate of $0.55 and the consensus mean of $0.54.
  • Margins were better than expected, while revenue of $949.5 million came in at the low end of guidance.
  • Sales in the Americas segment disappointed relative to our expectations.

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