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Smartkarma Daily Briefs

Oct 06
0

Daily Brief Equity Bottom-Up: Eoflow: Ozempic and Wegovy Reducing Need for Disposable Insulin Injection Devices + Ongoing Lawsuit? and more

By | Daily Briefs, Equity Bottom-Up

In today’s briefing:

  • Eoflow: Ozempic and Wegovy Reducing Need for Disposable Insulin Injection Devices + Ongoing Lawsuit?
  • FAST RETAIL (9983) | 3 Reasons Why Guidance Could Miss
  • Xinyi Glass (868 HK):  More Resilient Than Perceived
  • TSMC (2330.TT): The Advanced Technology Nodes Are Looking at Upside in 2024F
  • NEE & NEP Selloff Prompted by Higher for Longer Rates Sentiment
  • Samsung Biologics (207940 KS): Raises 2023 Sales Guidance Second Time This Year; Buy the Dip
  • SBI Holdings – Pages of Affiliates | Strong Securities | Banks Doing Well | Accelerating Profit
  • China Power International (2380 HK): Continuing the Turnaround Trend
  • GeoPark Limited (NYSE: GPRK): CPO-5 wells back online. Multiple discoveries in Colombia and Ecuador
  • ATEN: Order Delays Continue, PT to $15

Eoflow: Ozempic and Wegovy Reducing Need for Disposable Insulin Injection Devices + Ongoing Lawsuit?

By Douglas Kim

  • Eoflow’s share price has dropped 27% lower than the proposed tender offer price of 30,000 won. Two major factors have negatively impacted Eoflow (294090 KS)’s share price.
  • First, in September 2023, there were new data that suggested that popular weight loss drugs including Ozempic and Wegovy could reduce the need for insulin injections with patients with diabetes.
  • Second, the ongoing lawsuit by Insulet continues to remain a major headache. Eoflow is not a KISS (“Keep It Simple Stupid”) stock.

FAST RETAIL (9983) | 3 Reasons Why Guidance Could Miss

By Mark Chadwick

  • Fast Retail Full-Year Expectations: Anticipate strong FY results, but potential FY8/24 guidance headwinds include weather impacts and yen weakness.
  • Management Guidance Risks: The key risk would seem to be China outlook; Japan/Europe’s heatwave impact on fall season; potential for gross margin pressures.
  • Valuation: Despite growth prospects, concerns over cyclicality and valuation relative to peers persist.

Xinyi Glass (868 HK):  More Resilient Than Perceived

By Steve Zhou, CFA

  • Xinyi Glass Holdings (868 HK)‘s stable auto glass business is often overlooked, making up 39% of the company’s gross profit in 1H23.
  • Given the current valuation of 7x 2023E PE and 1.3x 2023E PB, the risk reward is skewed to the upside, and downside is protected with the stable auto glass business. 
  • The company’s management has been aggressively increasing stake in the company in the last 2 months, gobbling up 11 million shares.

TSMC (2330.TT): The Advanced Technology Nodes Are Looking at Upside in 2024F

By Patrick Liao

  • It is expected that TSMC will have full capacity utilization of 3nm and 5nm technology nodes starting from 1Q24F.
  • Regarding 3nm technology, the EUV mask layer will be reduced.
  • The total number of iPhone 15 units sold in 2023F is expected over 85 million.

NEE & NEP Selloff Prompted by Higher for Longer Rates Sentiment

By Pranay Yadav

  • Higher for longer rate regime makes it difficult for NextEra Energy Partners to raise debt to fund high growth forcing a reduction in growth forecasts.
  • Markets have reacted sharply to slashed forecasts with shares of NEP (-52%) & NEE (-22%). Growth is expected to remain lower in the future.
  • NEE has performed markedly better than NEP. This is reflected by analyst price targets. However, NEE’s long-term growth story has stumbled raising investor concerns.

Samsung Biologics (207940 KS): Raises 2023 Sales Guidance Second Time This Year; Buy the Dip

By Tina Banerjee

  • Samsung Biologics (207940 KS) expects 2023 revenue to grow by more than 20% YoY compared to 15–20% YoY growth expectations earlier, due to better-than-expected utilization of Plant 4.
  • For the first time in the company’s history, Samsung Biologics has won contracts worth nearly KRW3T during the first half of 2023, with eight contracts worth more than KRW100B each.
  • Anticipating strong demand, Samsung Biologics is building its fifth manufacturing plant with 180KL capacity, which is expected to be completed by April 2025.

SBI Holdings – Pages of Affiliates | Strong Securities | Banks Doing Well | Accelerating Profit

By Daniel Tabbush

  • SBI Holdings (8473 JP) may not be the easiest company to analyze with its many pages of affiliates, but at the least, it’s profit momentum is strong.
  • Securities Group profit is key to the company where growth is excellent in earnings and in the number of new accounts, across many businesses.
  • Its two banks in Japan are doing well, growing faster than others, but still SBI Holdings (8473 JP) is more of an alternative financial company to a traditional bank.

China Power International (2380 HK): Continuing the Turnaround Trend

By Osbert Tang, CFA

  • Power output for China Power International (2380 HK) is healthy in Jul-Aug, following the solid trend in 1H23. The drop in hydropower has moderated and wind and solar stayed decent.
  • Capacity growth will reach 43% in FY23. With just 7.8% YoY in 1H23, most of the new capacity will be added in 4Q23, accelerating both output and profitability.
  • The parent SPIC’s massive clean energy assets are candidates for potential injection. CPI’s high EPS CAGR of 28.8% means that it well deserves premium valuation multiples. 

GeoPark Limited (NYSE: GPRK): CPO-5 wells back online. Multiple discoveries in Colombia and Ecuador

By Auctus Advisors

  • • The Indico 6 and Indico 7 wells in the CPO-5 block in Colombia are now back online.
  • Each well is expected to reach 4,000 bbl/d gross production (8,000 bbl/d gross total, 2,400 bbl/d net to GeoPark).
  • The total gross production of both wells could reach 9,000 bbl/d by YE23.

ATEN: Order Delays Continue, PT to $15

By Hamed Khorsand

  • ATEN continues to experience challenges with order timing from some of its largest customers. ATEN lowered Q3 revenue forecast after North American service providers delayed their purchases in the quarter
  • ATEN has spent the entire year trying to add more enterprise customers to offset this volatility and, while successful, it was not enough in the third quarter.
  • ATEN is projecting third quarter revenue between $56.5 million and $58.5 million compared to our estimate of $75.3 million.

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Oct 06
0

Daily Brief Indonesia: Medco Energi and more

By | Daily Briefs, Indonesia

In today’s briefing:

  • Medco Energi – Earnings Flash – H1 FY 2023 Results – Lucror Analytics

Medco Energi – Earnings Flash – H1 FY 2023 Results – Lucror Analytics

By Leonard Law, CFA

Medco Energi’s H1/23 results were acceptable in our view. The company’s earnings were soft, weighed down by lower O&G selling prices despite higher production volumes. That said, we expect Medco’s earnings to rebound in H2, considering the recent rally in oil prices. Positively, the company’s leverage and liquidity profile remain strong. We believe Medco will be able to accommodate its USD 400-800 mn acquisition in the Middle East without breaching the 2.5x net leverage target.

In addition, we note positively Amman Mineral Nusa Tenggara’s (AMMN) successful IPO in July 2023. We note that Medco’s 21% stake in AMMN is worth USD 6.1 bn (based on AMMN’s current market cap of c. USD 29 bn), which is far larger than Medco’s own market cap of USD 2.2 bn.

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Oct 06
0

Daily Brief India: Tata Motors Ltd and more

By | Daily Briefs, India

In today’s briefing:

  • Morning Views Asia: AAC Technologies Holdings, Tata Motors ADR

Morning Views Asia: AAC Technologies Holdings, Tata Motors ADR

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.

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Oct 06
0

Daily Brief China: People’s Insurance (PICC), Xinyi Glass Holdings, Tian Tu Capital, China Power International, Tata Motors Ltd and more

By | China, Daily Briefs

In today’s briefing:

  • PICC’s (1339 HK) Lifetime Low Implied Stub
  • Xinyi Glass (868 HK):  More Resilient Than Perceived
  • Tian Tu Capital IPO Trading – Subscription Rates Were Lukewarm
  • China Power International (2380 HK): Continuing the Turnaround Trend
  • Morning Views Asia: AAC Technologies Holdings, Tata Motors ADR

PICC’s (1339 HK) Lifetime Low Implied Stub

By David Blennerhassett

  • People’s Insurance (PICC) (1339 HK) is currently trading at an all-time low implied stub.
  • Stripping out PICC’s 68.98% stake in PICC Property & Casualty H (2328 HK), the market is assigning HK$35.6bn less for its steady and profitable life/health insurance stub ops, year-to-date. 
  • PICC is outperforming the HSI. It’s just that PICC P&C is on a hot streak, possibly driven (pun intended) by EV insurance. 

Xinyi Glass (868 HK):  More Resilient Than Perceived

By Steve Zhou, CFA

  • Xinyi Glass Holdings (868 HK)‘s stable auto glass business is often overlooked, making up 39% of the company’s gross profit in 1H23.
  • Given the current valuation of 7x 2023E PE and 1.3x 2023E PB, the risk reward is skewed to the upside, and downside is protected with the stable auto glass business. 
  • The company’s management has been aggressively increasing stake in the company in the last 2 months, gobbling up 11 million shares.

Tian Tu Capital IPO Trading – Subscription Rates Were Lukewarm

By Clarence Chu

  • Tian Tu Capital (1390587D CH) raised around US$144m in its Hong Kong IPO.
  • Tian Tu Capital (TTC) is a private equity/venture capital investor and fund manager with a focus on Chinese consumer brands and companies.
  • We have covered various aspects of the deal in our previous notes. In this note, we will talk about the demand and trading dynamics.

China Power International (2380 HK): Continuing the Turnaround Trend

By Osbert Tang, CFA

  • Power output for China Power International (2380 HK) is healthy in Jul-Aug, following the solid trend in 1H23. The drop in hydropower has moderated and wind and solar stayed decent.
  • Capacity growth will reach 43% in FY23. With just 7.8% YoY in 1H23, most of the new capacity will be added in 4Q23, accelerating both output and profitability.
  • The parent SPIC’s massive clean energy assets are candidates for potential injection. CPI’s high EPS CAGR of 28.8% means that it well deserves premium valuation multiples. 

Morning Views Asia: AAC Technologies Holdings, Tata Motors ADR

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.

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Oct 06
0

Daily Brief United States: Tesla Motors, Nextera Energy, A10 Networks, Adeia and more

By | Daily Briefs, United States

In today’s briefing:

  • Tesla’s Problem Is Fading Demand, Not Disruptive Factory “Updates”
  • NEE & NEP Selloff Prompted by Higher for Longer Rates Sentiment
  • ATEN: Order Delays Continue, PT to $15
  • ADEA: Adjusting to Customer Dispute

Tesla’s Problem Is Fading Demand, Not Disruptive Factory “Updates”

By Vicki Bryan

  • Factory shutdowns for “updates” doesn’t explain Tesla’s huge Q3 miss on deliveries.
  • Why? Because bloated excess inventory was enough to cover the 20k “miss” some 3-5x. 
  • A better explanation: Tesla’s accelerating demand erosion, which I have been tracking since last year in every major market.

NEE & NEP Selloff Prompted by Higher for Longer Rates Sentiment

By Pranay Yadav

  • Higher for longer rate regime makes it difficult for NextEra Energy Partners to raise debt to fund high growth forcing a reduction in growth forecasts.
  • Markets have reacted sharply to slashed forecasts with shares of NEP (-52%) & NEE (-22%). Growth is expected to remain lower in the future.
  • NEE has performed markedly better than NEP. This is reflected by analyst price targets. However, NEE’s long-term growth story has stumbled raising investor concerns.

ATEN: Order Delays Continue, PT to $15

By Hamed Khorsand

  • ATEN continues to experience challenges with order timing from some of its largest customers. ATEN lowered Q3 revenue forecast after North American service providers delayed their purchases in the quarter
  • ATEN has spent the entire year trying to add more enterprise customers to offset this volatility and, while successful, it was not enough in the third quarter.
  • ATEN is projecting third quarter revenue between $56.5 million and $58.5 million compared to our estimate of $75.3 million.

ADEA: Adjusting to Customer Dispute

By Hamed Khorsand

  • ADEA revised its full year outlook after electing to sue long-time customer Shaw Communications for breach of contract
  • Shaw was acquired by Rogers Communications (RCI). ADEA claims Shaw is no longer paying ADEA even though the two companies had signed a license renewal in 2019
  • We are reducing our 2023 revenue forecast to approximately $387.7 million with operating income of $250.8 million

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Oct 06
0

Daily Brief Japan: Fast Retailing, TSE Tokyo Price Index TOPIX, SBI Holdings and more

By | Daily Briefs, Japan

In today’s briefing:

  • FAST RETAIL (9983) | 3 Reasons Why Guidance Could Miss
  • Policy Shareholdings, if Reduced, Should Be Used for Profitable Investments
  • SBI Holdings – Pages of Affiliates | Strong Securities | Banks Doing Well | Accelerating Profit

FAST RETAIL (9983) | 3 Reasons Why Guidance Could Miss

By Mark Chadwick

  • Fast Retail Full-Year Expectations: Anticipate strong FY results, but potential FY8/24 guidance headwinds include weather impacts and yen weakness.
  • Management Guidance Risks: The key risk would seem to be China outlook; Japan/Europe’s heatwave impact on fall season; potential for gross margin pressures.
  • Valuation: Despite growth prospects, concerns over cyclicality and valuation relative to peers persist.

Policy Shareholdings, if Reduced, Should Be Used for Profitable Investments

By Aki Matsumoto

  • TSE market reorganization triggered the reduction of policy shareholdings, and now the test will be whether policy shareholdings can be reduced in order to raise ROE, which is sluggishly growing.
  • Companies that maintain excessive policy shareholdings should provide a rational explanation of their holding policies and the reasons for each shareholding in their corporate governance reports and annual securities reports.
  • Improving OP Margin, which is highly correlated with ROE, is a shortcut to raising ROE. Policy shareholdings, should not be accumulated in cash on hand, but used for profitable investments.

SBI Holdings – Pages of Affiliates | Strong Securities | Banks Doing Well | Accelerating Profit

By Daniel Tabbush

  • SBI Holdings (8473 JP) may not be the easiest company to analyze with its many pages of affiliates, but at the least, it’s profit momentum is strong.
  • Securities Group profit is key to the company where growth is excellent in earnings and in the number of new accounts, across many businesses.
  • Its two banks in Japan are doing well, growing faster than others, but still SBI Holdings (8473 JP) is more of an alternative financial company to a traditional bank.

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Oct 06
0

Daily Brief Macro: Asia Economics: Where Do Asian Currencies Go as Fed Rate Hikes Cease? and more

By | Daily Briefs, Macro

In today’s briefing:

  • Asia Economics: Where Do Asian Currencies Go as Fed Rate Hikes Cease?
  • Real Rates Above 2%? Buy Bonds and Sell Equities
  • Recession Nugget: 4 Charts for the Equity Bears, 1 Chart for the Bulls!
  • Macro Regime Model: Inflation down while growth is on the up?

Asia Economics: Where Do Asian Currencies Go as Fed Rate Hikes Cease?

By Manu Bhaskaran

  • The short-term outlook for Asian currencies is moderately positive as the US Fed signals an end to its hiking campaign. Economic conditions in major markets support this view. 
  • Trade-Reliant economies, particularly those depending on semiconductor exports, have seen their currencies endure larger setbacks. A tentative recovery in trade may provide an upside  
  • While policy uncertainty and investor risk aversion are headwinds, metrics of currency resilience remain broadly healthy across selected Asian markets.

Real Rates Above 2%? Buy Bonds and Sell Equities

By Jeroen Blokland

  • Using a relatively short data sample, we show that buying bonds when the US 10-year real yield rises above 2% has been an attractive strategy.
  • Equities underperformed their long-term average once the real yield hit this critical level.
  • Moreover, the Federal Reserve Target Rate and the real yield tended to drop once the latter crossed the 2% threshold.

Recession Nugget: 4 Charts for the Equity Bears, 1 Chart for the Bulls!

By Ulrik Simmelholt

  • Takeaways: Yield curve looks prone to make equities puke. Real economic data looks weak as well. Jobs still strong lending support. 
  • Let’s start by honing in on the historic perspective of the recent moves in the yield curve.
  • Equity longs are already getting a taste of the curve medicine with SPX down some 6% in a month with long-end yields up more than 15%.

Macro Regime Model: Inflation down while growth is on the up?

By Andreas Steno

  • Every month, we present our best evaluation of the present and approaching month’s macroeconomic conditions, balancing risks and rewards.
  • We put to use our Macro Regime Indicator framework, alongside the interactive Structural Asset Allocation Model, to carry out this analysis.
  • Coming into September, we wrote that: “Looking ahead, we do not expect sudden shocks or changes to the current conditions.

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Oct 06
0

Most Read: Boustead Plantations, Doosan Robotics, JMDC , Eoflow , Kokusai Electric , People’s Insurance (PICC), CALB Group , Fast Retailing, POSCO Holdings and more

By | Daily Briefs, Most Read

In today’s briefing:

  • BPlant/KLK: This Is Getting (Even More) Political
  • Doosan Robotics (454910 KS): Listing & Index Inclusion Timeline
  • JMDC (4483) Partial Offer Update (Updated Pro-Ration Range)
  • EOFLOW/Medtronic Tender: Proposed Preliminary Injunction Is a Problem
  • Kokusai Electric Pre-IPO – Thoughts on Valuation
  • PICC’s (1339 HK) Lifetime Low Implied Stub
  • Eoflow: Ozempic and Wegovy Reducing Need for Disposable Insulin Injection Devices + Ongoing Lawsuit?
  • CALB IPO Lock-Up – US$2.6bn Lockup Release but Mostly SOE Owned
  • FAST RETAIL (9983) | 3 Reasons Why Guidance Could Miss
  • Exploring the Launch of a Posco Group-Focused ETF: Flow Trading Insights

BPlant/KLK: This Is Getting (Even More) Political

By David Blennerhassett

  • On the 24 August, Kuala Lumpur Kepong (KLK MK) entered an agreement with Boustead Holdings (BHB), Boustead Plantations (BPLANT MK)‘s largest shareholder, to acquire a 33% plus 1 share stake.
  • Upon the completion of the agreement, KLK – together with BHB and LTAT – would make a Mandatory Offer for BPlant. The Offer Price would be RM1.55/share, a lifetime high
  • It all looked pretty straightforward. However the BHB/LTAT agreement has twice been delayed. This may still get done. But there remain a number of political kinks to be ironed out. 

Doosan Robotics (454910 KS): Listing & Index Inclusion Timeline

By Brian Freitas

JMDC (4483) Partial Offer Update (Updated Pro-Ration Range)

By Travis Lundy

  • When this was launched, it traded more a fair bit on the first day, but then more volume traded than I expected. This could mean a couple of things.
  • Re-Reading the original doc leaves nuances. The change in management responsibilities this past summer make some holders less certain. It’s complicated. 
  • There have been several blocks traded, and a large short instantiated. And if one has a more conservative estimate at a higher top-end participation, the back end gets uglier.

EOFLOW/Medtronic Tender: Proposed Preliminary Injunction Is a Problem

By Arun George

  • The US judge has proposed a preliminary injunction which prevents Eoflow (294090 KS) from using Insulet Corp (PODD US)’s trade secrets and disclosing them to any third party.
  • Eoflow and other defendants must respond by 5 October. The court hearing is set for 16 October. The potential trial is to be discussed in Spring of 2024.
  • Medtronic Plc (MDT US) faces a difficult choice. If the injunction is enforced, Medtronic would acquire a ring-fenced asset exposed to potential court-determined liabilities. 

Kokusai Electric Pre-IPO – Thoughts on Valuation

By Sumeet Singh

  • KKR is looking to raise around US$750m via selling a stake in Kokusai Electric (6525 JP) (KE) in its Japan IPO.
  • KE main business activities consist of the manufacturing, sales and maintenance service of semiconductor manufacturing equipment.
  • In our previous notes we have looked at the company’s past performance and undertaken a peer comparison. In this note, we talk about valuations.

PICC’s (1339 HK) Lifetime Low Implied Stub

By David Blennerhassett

  • People’s Insurance (PICC) (1339 HK) is currently trading at an all-time low implied stub.
  • Stripping out PICC’s 68.98% stake in PICC Property & Casualty H (2328 HK), the market is assigning HK$35.6bn less for its steady and profitable life/health insurance stub ops, year-to-date. 
  • PICC is outperforming the HSI. It’s just that PICC P&C is on a hot streak, possibly driven (pun intended) by EV insurance. 

Eoflow: Ozempic and Wegovy Reducing Need for Disposable Insulin Injection Devices + Ongoing Lawsuit?

By Douglas Kim

  • Eoflow’s share price has dropped 27% lower than the proposed tender offer price of 30,000 won. Two major factors have negatively impacted Eoflow (294090 KS)’s share price.
  • First, in September 2023, there were new data that suggested that popular weight loss drugs including Ozempic and Wegovy could reduce the need for insulin injections with patients with diabetes.
  • Second, the ongoing lawsuit by Insulet continues to remain a major headache. Eoflow is not a KISS (“Keep It Simple Stupid”) stock.

CALB IPO Lock-Up – US$2.6bn Lockup Release but Mostly SOE Owned

By Sumeet Singh

  • CALB Group (3931 HK) raised around US$1.2bn in its Hong Kong IPO in Oct 2022. The lockup on its pre-IPO shareholders will expire tomorrow.
  • CALB undertakes design, R&D, production and sales of EV batteries and Energy Storage Systems (ESS) products in China.
  • In this note, we will talk about the lock-up dynamics and updates since our last note.

FAST RETAIL (9983) | 3 Reasons Why Guidance Could Miss

By Mark Chadwick

  • Fast Retail Full-Year Expectations: Anticipate strong FY results, but potential FY8/24 guidance headwinds include weather impacts and yen weakness.
  • Management Guidance Risks: The key risk would seem to be China outlook; Japan/Europe’s heatwave impact on fall season; potential for gross margin pressures.
  • Valuation: Despite growth prospects, concerns over cyclicality and valuation relative to peers persist.

Exploring the Launch of a Posco Group-Focused ETF: Flow Trading Insights

By Sanghyun Park

  • KRX approved the listing of ACE POSCO Group Focus. This fund mirrors the performance of the FnGuide POSCO Group Focus Index. KRX will announce the listing date next week.
  • This index encompasses 6 Posco affiliates and 4 non-Posco stocks. The top 3 constituents, each assigned a 25% weight, are POSCO Holdings, Posco International, and Posco Future M.
  • We should explore various long-short setups for stocks within the local battery sector (long Posco affiliates and short others), starting with the listing of this ACE POSCO Group Focus ETF.

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Oct 05
0

Daily Brief Quantitative Analysis: US Factor Strategies: Value and Dividend Yield Outperform in September and more

By | Daily Briefs, Quantitative Analysis

In today’s briefing:

  • US Factor Strategies: Value and Dividend Yield Outperform in September, Higher for Longer Narrative

US Factor Strategies: Value and Dividend Yield Outperform in September, Higher for Longer Narrative

By Charlotte van Tiddens, CFA

  • Short duration US factor strategies outperformed in September as markets came under pressure (value and dividend yield).
  • Despite keeping rates unchanged on the 20th of September at 5.5% (upper bound), Fed Chair Powell indicated that rates would be kept higher for longer than initially anticipated.
  • In this note we explore the relative performance of US factor strategies through different interest rate cycles, to inform timing around factor/style rotation.

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Oct 05
0

Daily Brief Thematic (Sector/Industry): Ohayo Japan | Stocks Recover; Hitachi Zosen’s Cheap Cuts of Lab-Grown Meat and more

By | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

  • Ohayo Japan | Stocks Recover; Hitachi Zosen’s Cheap Cuts of Lab-Grown Meat
  • Indian Life Insurance (And Savings) Sector Primer – Long-Term Potential and Strong Operating Margins
  • Australia – New Insolvencies Data: Construction Appointments at 829 Vs 588 YoY | Credit Risk Worsens
  • Mat-Chem Notes For the Week Ended September 29, 2023

Ohayo Japan | Stocks Recover; Hitachi Zosen’s Cheap Cuts of Lab-Grown Meat

By Mark Chadwick

  • OVERSEAS: SPX +0.8% as stocks recover from recent steep losses;  ADP data hints at slower pace of job growth; bond yields eased off
  • JAPAN: Nikkei Futures (+0.5% v cash) point to stronger open, JPY 149/$. Toyota signs long-term battery deal with LG Energy; Docomo takes stake in Monex.
  • JapanX: Hitachi Zosen slashes lab-grown meat protein cost by 90%

Indian Life Insurance (And Savings) Sector Primer – Long-Term Potential and Strong Operating Margins

By Raj Saya, CA, CFA

  • Indian Life Insurance Sector is a play on lucrative Indian demographics, under-penetration of life insurance and retirement savings across cohorts of the population.
  • The large firmsSBI Life, HDFC Life , LIC IN , ICICI Pru, MAXF IN are ripe for long-term secular growth for decades to come as they dominate the market.
  • This “Primer” sets the stage for the company-specific notes to follow. Here we discuss the sector level issues, key metrics and relative valuations. See attached PDF- Free access.

Australia – New Insolvencies Data: Construction Appointments at 829 Vs 588 YoY | Credit Risk Worsens

By Daniel Tabbush

  • Australia Securities & Investment Commission produces high-frequency data on insolvencies, which is valuable data for analyzing banks. There is pronounced deterioration in at least 3 sectors.
  • In construction, total appointments rose to 829 YTD to 10 Sept 2023 from 588 a year ago and from 250 in the preceding comparable period.
  • Hotel & food services and retail trade are also seeing high growth of insolvencies. Australia’s banks will likely face more defaults, NPLs and credit costs.

Mat-Chem Notes For the Week Ended September 29, 2023

By Water Tower Research

  • WTR-CMI last week. The third quarter ended on a down note, with the S&P 500 losing 3.7% and the Russell 2000 dropping 2.7%.
  • Our WTR-CMI index slightly underperformed the Russell 2000, declining 3.0% for the week. Coincidently, RYAM led the performance of stocks in our index, appreciating 18% last week, as news spread of one of its main competitors in commodity markets announcing the intention to shut down a major wood pulp production plant in the US
  • Lithium (LAC and PLL) and ag- chem stocks (FMC and AVD) were the worst performers in our index last week on lower lithium prices and signs of slowing EV demand, and a weaker farmer outlook for 2024/25 season.

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