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Smartkarma Daily Briefs

Feb 18
0

Daily Brief Japan: Mori Trust Sogo Reit, Tokyo Stock Exchange Tokyo Price Index Topix and more

By | Daily Briefs, Japan

In today’s briefing:

  • Mori Trust Sogo REIT (8961) Small Index Upweight on 27 Feb
  • Different Criteria for Exercising Voting Rights for Overseas and Domestic Institutional Investors

Mori Trust Sogo REIT (8961) Small Index Upweight on 27 Feb

By Travis Lundy

Different Criteria for Exercising Voting Rights for Overseas and Domestic Institutional Investors

By Aki Matsumoto

  • The number of shareholder proposals in June 2022 was 241, significant increase from 136 in June 2021. It’s expected that the number of shareholder proposals will increase again this year.
  • The increase in the percentage of shareholder proposals recommended by voting advisors can be considered an increase in shareholder proposals that are quite reasonable from the shareholder’s point of view.
  • The percentage of overseas investors in favor of shareholder proposals increased, while that of domestic institutional investors remained unchanged at 7%, the same as the previous year.

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Feb 18
0

Daily Brief ESG: Different Criteria for Exercising Voting Rights for Overseas and Domestic Institutional Investors and more

By | Daily Briefs, ESG

In today’s briefing:

  • Different Criteria for Exercising Voting Rights for Overseas and Domestic Institutional Investors

Different Criteria for Exercising Voting Rights for Overseas and Domestic Institutional Investors

By Aki Matsumoto

  • The number of shareholder proposals in June 2022 was 241, significant increase from 136 in June 2021. It’s expected that the number of shareholder proposals will increase again this year.
  • The increase in the percentage of shareholder proposals recommended by voting advisors can be considered an increase in shareholder proposals that are quite reasonable from the shareholder’s point of view.
  • The percentage of overseas investors in favor of shareholder proposals increased, while that of domestic institutional investors remained unchanged at 7%, the same as the previous year.

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Feb 18
0

Daily Brief Quantitative Analysis: Hong Kong Buybacks Weekly (Feb 17th): Great Wall Motor and more

By | Daily Briefs, Quantitative Analysis

In today’s briefing:

  • Hong Kong Buybacks Weekly (Feb 17th): Great Wall Motor, Esr, Sunshine Paper

Hong Kong Buybacks Weekly (Feb 17th): Great Wall Motor, Esr, Sunshine Paper

By Ke Yan, CFA, FRM

  • We analyze statistics on top repurchases over one week, one month, one quarter and one year periods ended on Feb 17th based on HKEx daily reports.
  • In the past 7 days, the top 3 companies that repurchased the most shares from the market were Great Wall Motor (2333 HK), Esr (1821 HK), Sunshine Paper (2002 HK).
  • In the past 30 days, the top 3 companies that repurchased the most shares from the market were Aia (1299 HK), Tencent (700 HK), Great Wall Motor (2333 HK).

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Feb 18
0

Daily Brief ECM: Sirius XM Holdings Inc.: Major Drivers and more

By | Daily Briefs, ECM

In today’s briefing:

  • Sirius XM Holdings Inc.: Major Drivers

Sirius XM Holdings Inc.: Major Drivers

By Baptista Research

  • Sirius XM had a mixed quarterly result.
  • This was a challenging environment for the company as the auto sales were the lowest in 11 years in 2022.
  • Sirius XM is trying to attract more consumers to its platform and continues holding the largest share of car music outside combined terrestrial radio.

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Feb 18
0

Daily Brief Technical Analysis: Top Asia Shorts and more

By | Daily Briefs, Technical Analysis

In today’s briefing:

  • Top Asia Shorts

Top Asia Shorts

By Thomas Schroeder

  • After Asian indexes met targets we have now turned negative in a domino sequence.
  • Our table pounding inflationary higher USD and higher yield thesis is seeing the dollar on the move with yield in hot pursuit.
  • Bull divergence in yield and the USD warn or a multi month rise. This is just the beginning of the pain trade to unwind peak inflation and peak rate positioning.

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Feb 18
0

Daily Brief Credit: Weekly Wrap – 17 Feb 2023 and more

By | Credit, Daily Briefs

In today’s briefing:

  • Weekly Wrap – 17 Feb 2023

Weekly Wrap – 17 Feb 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. Alam Sutera Realty
  2. China SCE
  3. China Jinmao Holdings
  4. Lifestyle International Holdings
  5. Geely Auto

and more…

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Feb 18
0

Daily Brief Macro: CX Daily: Exclusive: Billionaire Founder of China Renaissance Goes Missing and more

By | Daily Briefs, Macro

In today’s briefing:

  • CX Daily: Exclusive: Billionaire Founder of China Renaissance Goes Missing
  • UK: Sales Briefly Warmed in Jan-23
  • Commodity Watch – What Super Cycle?

CX Daily: Exclusive: Billionaire Founder of China Renaissance Goes Missing

By Caixin Global

  • In Depth: China’s rural Covid wave exposes flaws in plan to prevent hospital overcrowding

  • Xi says China must boost consumer spending, foreign investment this year

  • China to take action against U.S. entities after balloon-related blacklisting

UK: Sales Briefly Warmed in Jan-23

By Phil Rush

  • UK retail sales rebounded in Jan-23 from a downwardly revised December to leave the downward trend intact. Unseasonable warmth probably aided the bounce.
  • A slower inflationary impulse would curb its depressing effect on sales volumes, but expansion also requires spending value growth to regain some pace.
  • Falling house prices could fuel a second leg down. Ongoing BoE rate hikes squeeze affordability, yet better mortgage deals may spare the market from crashing deeply.

Commodity Watch – What Super Cycle?

By Andreas Steno

  • Where is the global commodity super cycle that everyone keeps predicting? 
  • Industrial metals have outperformed energy (as we predicted) and will likely continue to do so
  • Selective positioning in the commodity space remains of vital value with no super cycle in sight

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Feb 18
0

Daily Brief Thematic (Sector/Industry): International Education Stocks: Surging Student Volumes and more

By | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

  • International Education Stocks: Surging Student Volumes
  • Japan Weekly | Citizen Watch, Asahi, Recruit, Mercari, Shimano

International Education Stocks: Surging Student Volumes

By Edward Slade

Japan Weekly | Citizen Watch, Asahi, Recruit, Mercari, Shimano

By Mark Chadwick

  • Japanese stocks ended the week down around 60bps. Global risk assets down on stronger US economic data and rate hike fears
  • Japan posted its largest trade deficit since 1979. The Japanese yen weaker at 134.5/$
  • We highlight the stocks that moved the market over the past week

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Feb 18
0

Daily Brief Event-Driven: Adani Group – MSCI’s Special Treatment Gets More Special and more

By | Daily Briefs, Event-Driven

In today’s briefing:

  • Adani Group – MSCI’s Special Treatment Gets More Special, and Partially Delayed, and Possibly Worse
  • Index Corporate Actions for Hanwha Solutions Split: Passive Flow Size & Schedule
  • Jiangnan Group (1366 HK): Powering Up
  • Mori Trust Sogo REIT (8961) Small Index Upweight on 27 Feb
  • NIFTY NEXT50 / NIFTY100 Index Rebalance: 5 Changes + Capping = Big Turnover
  • Jiangnan Group (1366 HK): Is the Chairman/CEO Reattempting Privatisation?
  • SARIA/Devro: Increased and Final

Adani Group – MSCI’s Special Treatment Gets More Special, and Partially Delayed, and Possibly Worse

By Travis Lundy

  • On 8 February, MSCI announced special treatment for the Adani names in its indices, discussed in Adani Group – MSCI Will Treat Very Adani Funds as a Very Special Case. 
  • Late on 15 February they came out with a revision of their implementation – which was problematic because some stocks had gone limit down many days in a row. 
  • The stocks responded. But it clearly isn’t an easy implementation, and it clearly isn’t over. 

Index Corporate Actions for Hanwha Solutions Split: Passive Flow Size & Schedule

By Sanghyun Park

  • Hanwha Solutions received shareholder approval for its proposed demerger on February 13. The demerger will split Hanwha Solutions into two separate entities: Hanwha Galleria and Hanwha Solutions.
  • Hanwha Solutions will experience a passive outflow of 0.92x ADTV at the closing price on February 24 for KOSPI 200. A similar passive inflow will occur on March 31.
  • MSCI Standard will deliver an outflow of 0.43x ADTV at the close on March 31 as the weight of Hanwha Solutions, an existing constituent, will be reduced.

Jiangnan Group (1366 HK): Powering Up

By David Blennerhassett

  • Jiangnan (1366 HK), a manufacturer of wires and cables for power transmission and distribution systems, was suspended yesterday at lunchtime pursuant to Hong Kong’s Code on Takeovers and Mergers.
  • But not before the share price gained 63% on clear news leakage.
  • Chu Hui, the chairman, CEO, and major shareholder, mulled taking the private six years ago. 

Mori Trust Sogo REIT (8961) Small Index Upweight on 27 Feb

By Travis Lundy

NIFTY NEXT50 / NIFTY100 Index Rebalance: 5 Changes + Capping = Big Turnover

By Brian Freitas

Jiangnan Group (1366 HK): Is the Chairman/CEO Reattempting Privatisation?

By Arun George

  • Jiangnan (1366 HK) entered a trading halt pending the release of an announcement under the Hong Kong Code on Takeovers and Mergers on 16 February. 
  • It is likely that Mr Chu Hui (Chairman and CEO), the largest shareholder representing 34.99% of outstanding shares is reattempting to privatise Jiangnan. 
  • The 83.9% share price run prior to the trading halt suggests that the offeror is very close to finalising a formal proposal at a hefty premium to the undisturbed price. 

SARIA/Devro: Increased and Final

By Jesus Rodriguez Aguilar

  • Shareholders have gently pressed. SARIA has upped by 4.4% (“increased and final”) its cash offer for casings manufacturer Devro to 320p+10p interim, which represents 10x EV/Fwd EBITDA and 17.1x Fwd P/E.
  • The increased consideration puts the offer almost in line with market leader Viscofan’s multiples (10.2x EV/Fwd EBITDA). The initial offer was already generous, even more so now.
  • The deal should complete. Spread (gross/annualised) is 1.06%/2.65%, assuming settlement by 14 July (settlement will happen the same day as the second permitted dividend payment).

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Feb 18
0

Daily Brief Equity Bottom-Up: Meilan Airport (357 HK): Takeaway from Recent Passenger Throughput and more

By | Daily Briefs, Equity Bottom-Up

In today’s briefing:

  • Meilan Airport (357 HK): Takeaway from Recent Passenger Throughput
  • Kolte Patil: Q4FY23 Is All Set to Bring a Strong Close to FY23
  • RPPL: Q3FY23 Was Seasonally Weak As Expected, But Q4FY23 Is On Track To Be Strong
  • Nesco: Business Is Now As Usual Similar to Pre-COVID Level
  • Classys (214150 KS): Record-High Sales and Profit in 2022; Geography Expansion to Accelerate Growth
  • Fresenius Medical Care (FME GR): Look Before You Leap; Uncertainty & Cost Pressure Continue to Bite
  • President Yoon Calls for Greater Competition and Social Contribution by the Korean Banks
  • The Clorox Co: Major Drivers
  • The Estee Lauder Companies Inc.: Major Drivers
  • Nubank (NU US); Strong Execution to Drive Premium ROE into 2023 and Beyond

Meilan Airport (357 HK): Takeaway from Recent Passenger Throughput

By Eric Chen

  • Strong passenger traffic year-to-date indicates that full-year passenger throughput for 2023 will be on par with 2019.
  • Concerns that China resuming outbound travel could turn domestic tourists away from Hainan are overblown, overlooking the huge pent-up leisure travel demand over last three years.
  • We expect investors will focus on pace and sustainability of the recovery when company announces 2022 results. Being eligible for Stock Connect Program in 2023 will be a key catalyst. 

Kolte Patil: Q4FY23 Is All Set to Bring a Strong Close to FY23

By Ankit Agrawal, CFA

  • Kolte Patil reported weaker than expected Q3FY23 accounting earnings due to slight delay in arrival of OC for some projects. However, sales velocity and business development activity was robust.
  • Reported Q3FY23 earnings had weak margins due to revenue contribution from two low-margin projects.
  • Q4FY23 is on track to be strong both in terms of reported earnings (which depends on the timing of OC) and sales velocity.

RPPL: Q3FY23 Was Seasonally Weak As Expected, But Q4FY23 Is On Track To Be Strong

By Ankit Agrawal, CFA

  • Q3FY23 tends to be the weakest quarter seasonally. Volume de-growth was -10% QoQ, in line with the expectation as per historical seasonality trend.
  • Q4FY23 is all set to be a strong quarter. Management is confident of closing FY23 as per the previously stated revenue and margin guidance.
  • The new value-added segment, Barrier Packaging, has started to contribute meaningfully to the revenue. Tube Laminates, another value-added segment, will also start to contribute soon.

Nesco: Business Is Now As Usual Similar to Pre-COVID Level

By Ankit Agrawal, CFA

  • BEC revenues continue to match the pre-COVID level suggesting that the business has now normalized fully post-COVID. COVID led shift in working habits has had no structural impact.
  • IT Office Leasing revenues grew 6%+ QoQ, led by the improvement in occupancy rates. Profitability also improved led by operating efficiencies. 
  • BEC’s EBIT margin came in significantly lower than expected due to one-off expense of INR 15cr for demolition of a factory shed to build a new exhibition hall.

Classys (214150 KS): Record-High Sales and Profit in 2022; Geography Expansion to Accelerate Growth

By Tina Banerjee

  • Classys (214150 KS) reported strong performance in 2022, with highest ever revenue and profit, driven by increased sales of equipment and consumables due to increased global awareness of major products.
  • Revenue from export recorded a CAGR of 30% during 2017–2022, mainly driven by strong growth in Brazil. Classys launched Shrink Universe in Korea and Ultraformer MPT in global market.
  • For 2023, Classys has guided for revenue of KRW170B (+20% YoY), driven by Shrink Universe’s expansion into the global market, full-fledged domestic sales of Volumemers, and increasing volume of consumables.

Fresenius Medical Care (FME GR): Look Before You Leap; Uncertainty & Cost Pressure Continue to Bite

By Tina Banerjee

  • Fresenius Medical Care Ag & Co (FME GR) is reporting decelerating organic revenue growth and earnings decline. The company has revised 2022 revenue and earnings guidance twice in last year.  
  • Earnings are heavily impacted by the unprecedented US labor market situation constraining capacity and accelerating wage inflation, and worsening macroeconomic environment driving cost inflation and supply chain disruptions.
  • For 2022, the company expects low single-digit percentage revenue growth and high teens to mid-twenties percentage decline in net income. CEO has stepped down within two months of taking charge.

President Yoon Calls for Greater Competition and Social Contribution by the Korean Banks

By Douglas Kim

  • We discuss the increasing likelihood of formation of another Internet bank, challenger banks, and other measures to foster competition and increase social contribution on the Korean banking sector in 2023.  
  • The Korean banks underperformed in the past week due to President Yoon pointing out “banks and telcos need to share the increasing living costs.”
  • We believe Kakao Bank is likely to underperform the market in the next several months as investors fear about greater competitive pressure, especially on the existing Internet banks.

The Clorox Co: Major Drivers

By Baptista Research

  • Clorox delivered a solid set of results in the previous quarter with organic sales growth in 3 to 4 segments, double-digit earnings growth, and gross margin expansion, despite the challenges in the market due to an unstable global operating environment.
  • The company delivered an all-around beat and continued to work on the enhancement of its brand equity.
  • Clorox has been encountering different challenges in the macro environment for the past few quarters especially after the Covid-19 tailwinds have receded.

The Estee Lauder Companies Inc.: Major Drivers

By Baptista Research

  • Estee Lauder delivered a highly disappointing result despite surpassing Wall Street expectations in terms of revenues as well as earnings.
  • With its business continuing to be pressured by external headwinds resulting from the pandemic, the organic net sales and the earnings per share decreased in the quarter for Estee Lauder.
  • Estee Lauder should also benefit from the acquisition of Tom Ford in competing with L’Oréal.

Nubank (NU US); Strong Execution to Drive Premium ROE into 2023 and Beyond

By Victor Galliano

  • 4Q22 results confirm that Nubank is the benchmark among EM neobanks in terms of activity rates, as well as trends in revenues and costs per client and digital efficiencies
  • We see further potential for broadening and deepening the product offer to customers, at little incremental cost especially in Brazil, to drive cost effective revenue growth
  • Our proprietary Nubank model forecasts are broadly in sync with positive consensus estimates; we forecast group ROE of close to 30% in FY 2025, despite high cost of credit assumptions

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