All Posts By

Smartkarma Daily Briefs

Nov 01
0

Daily Brief Thematic (Sector/Industry): Ohayo Japan | Looking Forward to November; Munger Thanks God for Japanese Trading Houses and more

By | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

  • Ohayo Japan | Looking Forward to November; Munger Thanks God for Japanese Trading Houses
  • What Sep US SEMI Equipment and Aug SIA/WSTS Global Sales Y/Y Discrepancy Tells Us?
  • Aditya Vision, EMIL- Forensic Analysis
  • Five Key Takeaways in Five Charts from 26th GlobOil 2023 Conference in India
  • Halloween Earnings Season 🎃 (Hyperscalers, TXN, VICR, SK Hynix, KLAC, MXL, INTC, AWE, ACMR, BESI)
  • Weekly Sustainable Investing Surveyor – Week Ended October 27, 2023

Ohayo Japan | Looking Forward to November; Munger Thanks God for Japanese Trading Houses

By Mark Chadwick

  • Overseas: SPX +0.7%, Nasdaq +0.5%; Indices finish higher after a difficult month. Mega-cap tech stocks lagged; Fed decision today.
  • Today: NKY Futs+1.6% v cash. JPY 151.7; BoJ monetary tweaks send Yen even lower. Toyota announces massive US battery capex plan; NTT Law under review.
  • JapanX: Charlie Munger describes Warren Buffett’s investment in Japanese trading houses in 2020 as “like having God just opening a chest and just pouring money into it”

What Sep US SEMI Equipment and Aug SIA/WSTS Global Sales Y/Y Discrepancy Tells Us?

By Andrew Lu

  • SEMI reports September front end and back end test/assembly equipment sales decline of 18% and 25% y/y, respectively, resulting 3Q23 sales decline of 17% and 28% y/y.
  • However, WSTS/SIA and US ISM Purchasing Managers Index reported more moderate 7% y/y decline in August global semi sales and 4% y/y decline in September index. 
  • The discrepancy is due to global semi vendors are seeing PC and Smartphone IC improvement but need to consume earlier overbuilt inventories first before boosting in house or foundries’ capex.

Aditya Vision, EMIL- Forensic Analysis

By Nitin Mangal

  • Aditya Vision (AVL IN) and Electronics Mart India (EMIL IN) are two organized regional players in the consumer durables industry with a rapid growth in the last year.
  • AVL carries several governance setbacks, including nomination and remuneration of directors and shareholding, along with some irregularities across balance sheet line items and cash management woes.
  • EMIL even though relatively better on the disclosure side has its own threats to the balance sheet, which includes litigations scare, trademark filing.

Five Key Takeaways in Five Charts from 26th GlobOil 2023 Conference in India

By Pranay Yadav

  • Global Vegetable Oil market remains in imbalance. This is expected to continue in the near future on accelerating demand and gradual supply.
  • India is and will continue to be the largest importer of vegetable oil.
  • National Trade & EXIM Policy has an outsized influence on price.

Halloween Earnings Season 🎃 (Hyperscalers, TXN, VICR, SK Hynix, KLAC, MXL, INTC, AWE, ACMR, BESI)

By Douglas O’Laughlin

  • Welcome to the Halloween Earnings Edition. It’s a spooky time in markets.
  • So far, there’s been a lot of volatility this earnings season, specifically around the Magnificent 7. Let’s discuss.
  • I won’t discuss each company specifically, but I will focus on the high-level capex commentary.

Weekly Sustainable Investing Surveyor – Week Ended October 27, 2023

By Water Tower Research

  • The WTR Sustainable Index fell by 0.5% W/W versus the S&P 500 Index (down 2.5%), the Russell 2000 Index (down 2.6%), and the Nasdaq Index (down 2.6%).
  • Energy Technology (12.9% of the index) was down by 4.8%, while Industrial Climate and Ag Technology (48.9% of the index) was down 1.8%, ClimateTech Mining was down 6.8%, and Advanced Transportation Solutions was up 4.2%.
  • Top 10 Performers: NVVE, AZRE, GCEI, NEP, RE, ALTA, FIX, MULN, RIDE, CGRN

💡 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


Nov 01
0

Daily Brief Quantitative Analysis: HK Short Interest Weekly: Anta Sports and more

By | Daily Briefs, Quantitative Analysis

In today’s briefing:

  • HK Short Interest Weekly: Anta Sports, Hkex, Shenzhou Intl, China Mobile
  • KRX Short Interest Weekly (Oct 27th): Samsung Biologic, Skc, Hotel Shilla Co, Ecopro

HK Short Interest Weekly: Anta Sports, Hkex, Shenzhou Intl, China Mobile

By Ke Yan, CFA, FRM

  • We analyzed the latest HK SFC report for aggregate short position as of Oct 20th.
  • Top short increases and decreases were tabulated for one week and four week period. 
  • We highlight short changes in Anta Sports, Hkex, Shenzhou Intl, China Mobile.

KRX Short Interest Weekly (Oct 27th): Samsung Biologic, Skc, Hotel Shilla Co, Ecopro

By Ke Yan, CFA, FRM

  • We analyzed the changes in short interest of KRX Stocks as of Oct 27th which has an aggregated short interest worth USD11.9bn.
  • 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 highlight short interest changes in Samsung Biologic, Skc, Hotel Shilla Co, Ecopro, Posco Holdings I, Yuhan, Posco Dx.

💡 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


Nov 01
0

Daily Brief Technical Analysis: Bullish Breadth Divergences Persist; Russell 2000 Testing 1.5-Year Support; Buys in Education Svcs and more

By | Daily Briefs, Technical Analysis

In today’s briefing:

  • Bullish Breadth Divergences Persist; Russell 2000 Testing 1.5-Year Support; Buys in Education Svcs

Bullish Breadth Divergences Persist; Russell 2000 Testing 1.5-Year Support; Buys in Education Svcs

By Joe Jasper

  • The SPX is at 4165-4200 support, and the Nasdaq 100 (QQQ) is at $350-$355 support. No “decisive” breakdowns quite yet as supports show signs of holding.
  • Russell 2000 (IWM) is testing 1.5-year support at $162-$163, making this a logical spot for small-caps to bounce and an attractive risk/reward for buyers
  • Continue to see signs of breadth possibly bottoming-out. Both the SPX and Russell 2000 and the % of stocks above their 50-day and 20-day MAs display bullish breadth divergences.

💡 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


Nov 01
0

Daily Brief ESG: Fewer TOPIX Remaining Companies Show the Difficulty of Producing Convincing Disclosures and more

By | Daily Briefs, ESG

In today’s briefing:

  • Fewer TOPIX Remaining Companies Show the Difficulty of Producing Convincing Disclosures
  • Ineos – ESG Report – Lucror Analytics
  • Arcor – ESG Report – Lucror Analytics
  • Volcan – ESG Report – Lucror Analytics

Fewer TOPIX Remaining Companies Show the Difficulty of Producing Convincing Disclosures

By Aki Matsumoto

  • 439 companies that will be excluded from TOPIX aren’t expected to face further selling pressure, but 43 companies that remain in TOPIX may have a positive impact in the future.
  • Only 43 companies (8.9%) succeeded in exceeding 10 billion yen in tradable market capitalization; compared to 22.3% rise in TOPIX, the stock performance of the TOPIX exclusion candidates were lackluster.
  • These companies with small market capitalizations represent a challenge that has made it difficult for them to attract investor attention and to come up with convincing disclosures.

Ineos – 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 Ineos’ ESG as “Adequate”, in line with its Environmental, Social and Governance scores. Controversies are “Immaterial” and Disclosure is “Adequate”.

    Ineos AG was awarded another gold sustainability rating by EcoVadis in 2022, while Ineos Group Holdings received a low-risk rating from Sustainalytics and was ranked the third-best commodity chemicals company out of 234 rated by the agency.

Arcor – 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 Arcor’s ESG as “Adequate”, in line with its “Adequate” Social and Governance scores. The company’s Environmental pillar is “Strong”. Controversies are “Immaterial” and Disclosure is “Strong”.
  • Arcor SAIC is one of the largest confectionery, cookie and food companies in Argentina. Founded in Cordoba, the company’s LTM Q2/23 sales and EBITDA stood at ARS 944.8 bn (USD 5.4 bn) and ARS 80 bn (USD 468 mn), respectively. 

Volcan – 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 Volcan’s ESG as “Adequate”, in line with its Environmental, Social and Governance scores. Controversies are “Immaterial” and Disclosure is “Adequate”.
  • Volcan Cia Minera SAA is a polymetallic mining company in Peru. It is one of the largest producers of zinc, lead and silver in the world.

💡 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


Nov 01
0

Daily Brief Credit: UPL Limited – Earnings Flash – Q2 FY 2023-24 Results – Lucror Analytics and more

By | Credit, Daily Briefs

In today’s briefing:

  • UPL Limited – Earnings Flash – Q2 FY 2023-24 Results – Lucror Analytics
  • Morning Views Asia: Lippo Karawaci

UPL Limited – Earnings Flash – Q2 FY 2023-24 Results – Lucror Analytics

By Trung Nguyen

UPL’s Q2/23-24 results were very weak, with revenues and earnings declining significantly and a deterioration in working capital. Our scepticism of the company has continued to deepen with the results. We are concerned about the lack of discussion on the huge debt reduction and unusual earnings call set-up in Q4/22-23, as well as the subsequent rebound in debt in Q1/23-24. We note that the pressure to reduce net debt to USD 2 bn in Q4/22-23 was to meet management’s aggressive guidance and rating agencies’ expectations. Management had released the Q4 results in early May 2023, almost halfway through Q1/23-24. Yet, there were few indications of very weak Q1 or H1 numbers.

In addition, we are sceptical of management’s guidance, even after it has been revised downwards. The new guidance implies c. 18% y-o-y revenue growth and a c. 28-30% increase in EBITDA in H2/23-24. That said, management does not expect y-o-y improvement in Q3. Hence, for UPL to meet the guidance, all the growth would have to be registered in Q4. We do not believe that the company will be able to meet the full-year guidance.

Morning Views Asia: Lippo Karawaci

By Charles Macgregor

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.

💡 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


Nov 01
0

Daily Brief ECM: Treasury Wine Entitlement Offer – Not as Straightforward as It Sounds and more

By | Daily Briefs, ECM

In today’s briefing:

  • Treasury Wine Entitlement Offer – Not as Straightforward as It Sounds
  • WuXi XDC IPO: The Bull Case
  • WuXi XDC Cayman Pre-IPO – PHIP Updates – Margins Remain Depressed Although Growth Still Strong
  • Asicland IPO Book Building Results Analysis
  • Pre-IPO WuXi XDC (PHIP Updates) – Some Points Worth the Attention
  • Midea A/H Listing – Filing Updates – Growth and Margins Pick Up

Treasury Wine Entitlement Offer – Not as Straightforward as It Sounds

By Sumeet Singh

  • Treasury Wine Estates (TWE AU) aims to raise up to US$525m (A$825m) via a renounceable fully underwritten entitlement offer.
  • Proceeds from the placement will be used to part fund the acquisition of DAOU Vineyards, a luxury wine brand based in California.
  • In this note, we will talk about the deal dynamics.

WuXi XDC IPO: The Bull Case

By Arun George

  • WuXi XDC Cayman Inc (1877628D HK), a leading contract research, development and manufacturing organization (CRDMO), is pre-marketing an HKEx IPO to raise US$500 million, according to press reports.   
  • WuXi XDC ranked No. 2 globally and No. 1 in China among CRDMO for antibody-drug conjugates and other bioconjugates in terms of revenue in 2022, according to Frost & Sullivan.
  • The bull case rests on large addressable markets, market share gains, fast-paced revenue growth, strong revenue visibility, a solid balance sheet and ambitious capacity expansion plans.

WuXi XDC Cayman Pre-IPO – PHIP Updates – Margins Remain Depressed Although Growth Still Strong

By Clarence Chu

  • WuXi XDC Cayman Inc (1877628D HK) is looking to raise around US$500m in its upcoming Hong Kong IPO.
  • WuXi XDC Cayman (WXDC) is a CRDMO focused on the global antibody drug conjugates (ADC) and broader bioconjugate market providing integrated and end-to-end services.
  • In our previous notes we looked at the company’s past performance, peer comparison, and shared our thoughts on valuations. In this note, we discuss WXDC’s PHIP updates.

Asicland IPO Book Building Results Analysis

By Douglas Kim

  • Asicland completed an excellent IPO book building results. IPO price has been determined at 25,000 won which is 17% higher than the high end of the IPO price range.
  • A total of 1,906 institutional investors participated in this IPO book building results. The IPO demand ratio was 490 to 1. Asicland IPO will start trading on 13 November. 
  • Our base case valuation of Asicland is implied market cap of 434 billion won or target price of 40,571 won per share, which is 62% higher than the IPO price.

Pre-IPO WuXi XDC (PHIP Updates) – Some Points Worth the Attention

By Xinyao (Criss) Wang

  • We’ve seen increasing global cooperation for ADC pipelines. However, licensing deals alone cannot be used as the only basis for judgment. We still need to wait for solid clinical evidence.
  • ADCs are far less “general and popularized” than PD-1. If compare ADC with GLP-1s, the difference is more obvious.How big the real market is for ADC is a question mark.
  • WuXi XDC’s share price could perform well after IPO due to positive sentiments towards ADC, but whether its long-term valuation would be higher than peers remains to be seen.  

Midea A/H Listing – Filing Updates – Growth and Margins Pick Up

By Sumeet Singh

  • Midea Group Co Ltd A (000333 CH), one of the world’s largest home appliance producers, aims to raise up to US$3bn in its H-share listing.
  • Midea Group is one of the world’s largest home appliance manufacturing companies with a presence in over 200 countries. Its A-shares have been listed since 2013.
  • We have covered the company and deal background in our previous note. In this note, we talk about the updates from the recent filing.

💡 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


Nov 01
0

Daily Brief Equity Bottom-Up: SK Hynix. DRAM To The Rescue and more

By | Daily Briefs, Equity Bottom-Up

In today’s briefing:

  • SK Hynix. DRAM To The Rescue
  • JD.Com: Losing Its Appeal?
  • Kuaishou/KS (1024 HK) Earnings Preview: Unnecessary Concerns About Chairman Change and 3Q23 Results
  • APAC Luxury Industry Series: Update
  • GoTo: In Pursuit of Profits…
  • Fanuc (6954) | Not Out of the Woods Yet
  • AviChina Industry (2357 HK): No Way Its Parts Are Greater than the Sum
  • Alfresa Holdings (2784 JP): Better-Than-Expected H1FY24 Performance; FY24 Guidance Raised
  • Midea Group (000333 CH):  Not That Correlated To China Property
  • Arbuthnot Banking Group (ARBB) Trading update: taking ABG to the next level

SK Hynix. DRAM To The Rescue

By William Keating

  • SK Hynix reported Q323 revenues of 9.066 trillion won, up 24% QoQ but still down 17% YoY
  • Net income was -2.185 trillion won, a 27% improvement on the losses in the prior quarter.
  • While DRAM has turned profitable, NAND remains stubbornly loss making and is likely to remain so for the foreseeable future

JD.Com: Losing Its Appeal?

By Steven Holden

  • After a spike higher in fund ownership in 2021, active Asia Ex-Japan funds are beginning to close out positions.
  • Funds including T.Rowe Price, LO Funds and Nikko AM have closed out exposure this year.
  • JD.com remains a very well owned stock among institutional investors, at a time when performance is anything but stellar so far this year.

Kuaishou/KS (1024 HK) Earnings Preview: Unnecessary Concerns About Chairman Change and 3Q23 Results

By Ming Lu

  • We believe Mr. Su’s resignation as chairman is not a concern, because Mr. Cheng, the CEO, has been operating the company for two years.
  • We believe the 3Q23 YoY growth will be lower, as 2Q23 had a lower comparison base.
  • We believe the operating margin can be negative in 3Q23 as Q3 is always a weak season, but operating profit will break even for 2023.

APAC Luxury Industry Series: Update

By Oshadhi Kumarasiri

  • This update builds upon our initial report on the APAC Luxury Industry, in which we expressed our belief that potential opportunities lie within the small niches of the luxury sector.
  • While the share price performance hasn’t met our expectations, the broader trend we highlighted, Luxury Travel and Tourism, has shown robust growth.
  • Even though travel flows have returned to pre-pandemic levels, Shiseido has not yet regained its pre-pandemic performance, however the two hotels are already operating at levels close to 2019 levels.

GoTo: In Pursuit of Profits…

By Shifara Samsudeen, ACMA, CGMA

  • GoTo reported 3Q2023 results on Monday. Gross revenues increased 1.4% YoY to IDR5.98trn while adj. EBITDA losses further narrowed down to IDR1.84trn vs IDR3.71trn in 3Q2022.
  • GoTo Gojek Tokopedia Tbk PT (GOTO IJ) continues to see huge reduction in losses but growth rates have fallen further with cutdown on incentives and promotional spending.
  • It seems that GoTo has stopped exploring growth opportunities in pursuit of profits, however, this may not be sustainable in the long-term with falling growth rates.

Fanuc (6954) | Not Out of the Woods Yet

By Mark Chadwick

  • Q2 2023 results for FANUC Group showed a 3.7% decrease in consolidated net sales, a 24.5% drop in consolidated operating income, and mixed performance in its divisions.
  • Some positives: operating profit exceeding analyst expectations and an operating margin increase to 17.2%. However, declining robot orders, challenges in the US region, and high inventory remain concerns
  • We believe that the stock is currently trading around fair value (20x EV/EBIT). However, we still see risks to the downside given macro concerns

AviChina Industry (2357 HK): No Way Its Parts Are Greater than the Sum

By Osbert Tang, CFA

  • The A-share subsidiaries of AviChina Industry & Technology (2357 HK) have mostly posted solid 3Q23 results – aggregate earnings growth has accelerated to 50.2%, from 26.8% in 1Q23.
  • Their 9M23 result reached 64% of FY23 consensus forecast earnings for AviChina, vs. just 61% a year ago. This indicates the market is too conservative and suggests room for upgrade.
  • Valuations are cheap at 8.7x and 7.0x PERs for FY23 and FY24. Its market capitalisation equals just 46% of the total attributable market capitalisation of these subsidiaries.

Alfresa Holdings (2784 JP): Better-Than-Expected H1FY24 Performance; FY24 Guidance Raised

By Tina Banerjee

  • Alfresa Holdings (2784 JP)‘s H1FY24 revenue, operating profit, and net profit are expected to exceed the previous expectations due to greater-than-expected growth in the ethical pharmaceuticals business.  
  • Encouraged by the growth in the pharmaceutical market and better-than-expected H1FY24 performance, the company has raised FY24 revenue, operating profit, and net profit guidance by 4%, 30%, and 36%, respectively.
  • New FY24 guidance implies, H2FY24 revenue run-rate will be similar to H1F24, while H2FY24 operating profit will accelerate to ¥20.1 billion from ¥15.9 billion in H1FY24.

Midea Group (000333 CH):  Not That Correlated To China Property

By Steve Zhou, CFA

  • Midea Group Co Ltd A (000333 CH) has officially filed for Hong Kong listing last week. 
  • A common pushback against owning the stock is the perception of strong correlation to China property, which is not true in terms of business fundamentals.
  • The stock is currently trading at 10x 2024E PE compared to an average of 13x over the last 10 years. 

Arbuthnot Banking Group (ARBB) Trading update: taking ABG to the next level

By Hardman & Co

  • In our view, the key takeaway from the recent 3Q trading statement is how ABG is progressing strategically towards its “Future State 2” plan.
  • In particular, we note specialist SME finance divisions generating the ambitious balance sheet growth in the plan, optimising the core relationship banking franchise, which, in this period, saw 7% deposit growth ‒ given the level of base rates, this is a profitable product for a relationship bank, and continued investment, which, at times, requires a step change in cost rather than a gentle evolution.
  • To meet expected multi-year demand, ABG is increasing its central London HQ office space by 45% at an annual increase in cost of ca.£5m (with further dual running costs until October 2024 as it is refitted).

💡 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


Nov 01
0

Daily Brief Macro: BTC Bull Run Preempts Other Digital Assets and more

By | Daily Briefs, Macro

In today’s briefing:

  • BTC Bull Run Preempts Other Digital Assets
  • CX Daily: China’s Family-Run Businesses Face Succession Issues
  • EA: Doves Near Inflation’s Trough

BTC Bull Run Preempts Other Digital Assets

By Pranay Yadav

  • Bitcoin price has increased 20% over the past week anticipating the imminent approval  of a spot Bitcoin ETF. 
  • Bitcoin has outperformed other digital assets over the past year. Dominance has reached a two-year high. 
  • BTC-ETH ratio is expected to continue rising after a near-term pullback due to ETF approval and relative safety providing strong tailwinds to BTC. 

CX Daily: China’s Family-Run Businesses Face Succession Issues

By Caixin Global

  • Family / Cover Story: China’s family-run businesses face succession issues 
  • China-U.S. /: China, U.S. ‘working together’ on Biden-Xi meeting at APEC next month
  • Personnel /: Communist Party names new economic czar

EA: Doves Near Inflation’s Trough

By Phil Rush

  • EA inflation plummeted by 1.4pp to 2.9% in Oct-23, 0.2pp beyond the consensus and within 0.1pp of our forecast again. But it is close to views prevailing since February.
  • The downside news concentrated on energy prices, as we expected, while the core matched forecasts by falling 0.3pp to 4.2%. National surprises broadly skewed lower.
  • We still expect a much smaller slowing in November before temporarily jumping into yearend. Recent downside news should encourage the ECB as it resists hiking again.

💡 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


Nov 01
0

Daily Brief Australia: Emerald Resources Nl, Treasury Wine Estates, ADX Energy Ltd, Lepidico Limited and more

By | Australia, Daily Briefs

In today’s briefing:

  • S&P/ASX 200 Index Adhoc Rebalance: Emerald Resources (EMR) To Replace Invocare (IVC)
  • Treasury Wine Entitlement Offer – Not as Straightforward as It Sounds
  • Auctus on Friday – 20/10/2023
  • ADX Energy Limited (ASE: ADX): On Track to start drilling in early November
  • Lepidico – Development plan evolves

S&P/ASX 200 Index Adhoc Rebalance: Emerald Resources (EMR) To Replace Invocare (IVC)

By Brian Freitas

Treasury Wine Entitlement Offer – Not as Straightforward as It Sounds

By Sumeet Singh

  • Treasury Wine Estates (TWE AU) aims to raise up to US$525m (A$825m) via a renounceable fully underwritten entitlement offer.
  • Proceeds from the placement will be used to part fund the acquisition of DAOU Vineyards, a luxury wine brand based in California.
  • In this note, we will talk about the deal dynamics.

Auctus on Friday – 20/10/2023

By Auctus Advisors

  • ________________________________________ ADX Energy (ADX AU)C; target price of A$0.80 per share: Two high impact wells to commence drilling by YE23 – ADX is expected to start drilling the Anshof-2 appraisal well in November.
  • Anshof is also estimated to hold 5.5 mmboe net 3C contingent resources (net to ADX).
  • We have changed our target price to A$0.80 per share as we incorporate the recently announced 10 for 1 share consolidation.

ADX Energy Limited (ASE: ADX): On Track to start drilling in early November

By Auctus Advisors

  • • 3Q23 production of 324 boe/d and cash of A$5.7 mm at the end of September were near our expectations.
  • This includes 101 bbl/d gross production for Anshof that was shut-in on 19 September after reaching the regulatory limit for test production.
  • Anshof-3 production will recommence after the drilling of the Anshof-2 well and the installation of a permanent production facility in February.

Lepidico – Development plan evolves

By Edison Investment Research

On 30 October, Lepidico announced the updated economics of its 2020 definitive feasibility study (DFS) on its integrated lithium hydroxide mine and chemical plant to show a base case NPV8 of US$457m post-tax, which equates to 9.4 Australian cents per share on a pre-funding basis. In our January 2019 report Gold stars and black holes, we calculated that companies with completed DFSs typically have an EV/NPV ratio of 30.9%, which would imply a pre-funding valuation for Lepidico of 2.9c/share, to which its shares are currently trading at a significant 69.0% discount.

💡 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


Nov 01
0

Daily Brief South Korea: Kakao Corp, SK Hynix, Doosan Robotics, ASICLAND and more

By | Daily Briefs, South Korea

In today’s briefing:

  • Concerns About A Major Accounting Fraud at Kakao Mobility
  • SK Hynix. DRAM To The Rescue
  • End of Mandatory Lock-Up Periods for 48 Companies in Korea in November 2023
  • Asicland IPO Book Building Results Analysis

Concerns About A Major Accounting Fraud at Kakao Mobility

By Douglas Kim

  • It was reported in numerous local media in Korea that FSS is investigating Kakao Mobility for a potential accounting fraud. 
  • There are suspicions that Kakao Mobility may have artificially inflated its sales from 2020 to 2023 to enhance the value of the company prior to its IPO listing. 
  • Given that the regulators are unlikely to make a final decision on this matter until next year, this is likely to be negative on both Kakao Mobility and Kakao Corp. 

SK Hynix. DRAM To The Rescue

By William Keating

  • SK Hynix reported Q323 revenues of 9.066 trillion won, up 24% QoQ but still down 17% YoY
  • Net income was -2.185 trillion won, a 27% improvement on the losses in the prior quarter.
  • While DRAM has turned profitable, NAND remains stubbornly loss making and is likely to remain so for the foreseeable future

End of Mandatory Lock-Up Periods for 48 Companies in Korea in November 2023

By Douglas Kim

  • We discuss the end of the mandatory lock-up periods for 48 stocks in Korea in November 2023, among which 6 are in KOSPI and 42 are in KOSDAQ.
  • These 48 stocks on average could be subject to further selling pressures in November and could underperform relative to the market.
  • Among these 48 stocks, top five market cap stocks include Doosan Robotics, Fadu, CanariaBio, Enchem, and Gigavis. 

Asicland IPO Book Building Results Analysis

By Douglas Kim

  • Asicland completed an excellent IPO book building results. IPO price has been determined at 25,000 won which is 17% higher than the high end of the IPO price range.
  • A total of 1,906 institutional investors participated in this IPO book building results. The IPO demand ratio was 490 to 1. Asicland IPO will start trading on 13 November. 
  • Our base case valuation of Asicland is implied market cap of 434 billion won or target price of 40,571 won per share, which is 62% higher than the IPO price.

💡 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