Smartkarma Daily Briefs, Author at Smartkarma

Feb 01

Daily Brief Crypto: Sporting Crypto – Sorare Announce £30m Per-Year Blockbuster Premier League Deal and more

By Smartkarma Daily Briefs | Crypto, Daily Briefs

In today’s briefing:

Sporting Crypto – Sorare Announce £30m Per-Year Blockbuster Premier League Deal

Sporting Crypto – Sorare Announce £30m Per-Year Blockbuster Premier League Deal

By Sporting Crypto

At long last — after months of rumours — Sorare and the English Premier League (EPL) have finally announced their exclusive multi-year deal thought to be worth £30m per year.
For Sorare, this was the final piece to the puzzle. That final big deal in Soccer that they wanted to get over the line.
Just over 4 years from inception, they now have deals in place with almost every top flight club and league in the world.

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Feb 01

Daily Brief Event-Driven: StubWorld: Mickey Upstages Keisei Electric and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

StubWorld: Mickey Upstages Keisei Electric
MSCI Feb 2023 QCIR Preview: Potential Changes as Review Period Ends
Toshiba (6502) – Funding Mostly Secured, Still, Again, Maybe. Or Maybe Not. Or Not.
Sembcorp Marine-Keppel O&M Merger Circular Squeaks In Under The Wire – Next Steps
Toshiba (6502 JP): Financing Deadline Slips Again as the 3Q Update Looms
Dufry/Autogrill: Deal Progress
ActivistTalk: Bed Bath & Beyond at Death’s Door

StubWorld: Mickey Upstages Keisei Electric

By David Blennerhassett

Keisei Electric Railway Co (9009 JP) is trading “cheap” as Oriental Land (4661 JP) enjoys a zero-Covid revival.
Preceding my comments on Keisei/Oriental Land, 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%.

MSCI Feb 2023 QCIR Preview: Potential Changes as Review Period Ends

By Brian Freitas

The review period for the February Quarterly Comprehensive Index Review (QCIR) of the MSCI indices ended yesterday. There will be a number of changes in the Asia Pacific region.
Most of the inclusions are in China and the country weight in the MSCI Emerging Markets Index should increase leading to outflows from other markets.
On average, the potential adds have outperformed the potential deletes over the last few weeks. At a glance, pre-positioning appears to be lighter than in the past.

Toshiba (6502) – Funding Mostly Secured, Still, Again, Maybe. Or Maybe Not. Or Not.

By Travis Lundy

The original bid was supposed to be presented fully-funded by 30 September 2022. Then it was early November, then late November, then early December, late Dec, early Jan, end Jan.
Today we find out that The Banks and The Preferred JIP Bidding Consortium will aim to reach agreement by 3 Feb. The Bloomberg article details are newish, and odd.
Shares have deteriorated and vs Peers, they are at their lowest point in many months. And the details do not make me confident this deal is clean yet.

Sembcorp Marine-Keppel O&M Merger Circular Squeaks In Under The Wire – Next Steps

By Travis Lundy

Last Friday, Sembcorp Marine (SMM SP) announced it had Approval-In-Principle for its Proposed Combination with Keppel Corp (KEP SP), contingent on the Circular being despatched by 31 January 2023.
At 6:50pm local time on 31 January, Sembcorp Marine released its 679-page Circular (and EGM Announcement (16 Feb EGM)). Phew!
Now we have a deal in sight, we have to think about next steps. SMM NEWCO needs a story vs flow. Orderbook is nice but may not cut it near-term.

Toshiba (6502 JP): Financing Deadline Slips Again as the 3Q Update Looms

By Arun George

Bloomberg reports that Japan Industrial Partners (JIP), the preferred bidder, has again extended the deadline for securing bank financing of around JPY1.2 trillion (US$8.8 billion).
A new issue has pushed the deadline to 3 February. If JIP manages to secure financing for an offer of around JPY5,100, the next challenge is securing Board support.
The 3QFY2022 update on 14 February needs to avoid further downgrades to keep the deal alive. Toshiba’s multiples are unattractive to peers. Remain on the sidelines for now.

Dufry/Autogrill: Deal Progress

By Jesus Rodriguez Aguilar

The deal is done with the transfer of Edizione’s 50.3% stake in Autogrill under way, and with all main hurdles cleared. Dufry must launch and offer to buy out minorities.
Autogrill shares closed at €6.698 on 30 January, also the implied value of the 0.158 Autogrill/Dufry share swap is 5.8% above the €6.33/share “initial” cash offer. The market expects more.
The deal will not fall through but the price is still being negotiated, possibly around €6.8-6.9/share. The issue will now become what dilution/leverage will Dufry’s patient shareholders endure.

ActivistTalk: Bed Bath & Beyond at Death’s Door

By Robert Sassoon

Bed Bath & Beyond (BBBY US) , the one-time iconic US homes good retailer, whose financial condition has continued to deteriorate rapidly, is barreling towards bankruptcy sooner rather than later
A default notice on one of its primary credit facilities has been served and failure to make a bond interest payment on Feb 1 could well seal its fate
There may not be any money left for its equity holders to recover which means there is a real prospect of the BBBY share price moving rapidly to zero

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Feb 01

Daily Brief Australia: Flight Centre Travel, Harvest Technology Group Ltd and more

By Smartkarma Daily Briefs | Australia, Daily Briefs

In today’s briefing:

Flight Centre Travel Group Placement – Still a Good Deal Despite Its Track Record
Harvest Technology Group Limited – Sales Moving up the Curve

Flight Centre Travel Group Placement – Still a Good Deal Despite Its Track Record

By Ethan Aw

Flight Centre Travel (FLT AU) is looking to raise US$127m from a fully underwritten institutional placement.
The proceeds will be used to acquire Luxury Travel Holdings (Scott Dunn), a UK-based luxury travel business.
In this note, we will discuss deal dynamics, past deal performance, and share the scores on our ECM framework.

Harvest Technology Group Limited – Sales Moving up the Curve

By Research as a Service (RaaS)

Harvest Technology Group Limited (ASX:HTG) licenses its proprietary video compression and encryption technology for low-bandwidth, high-latency applications needing secure real-time streaming video communication.
The company delivers solutions for data transfer from anywhere via satellite or congested networks.
Harvest offers a solution which enables real-time monitoring of remote locations, real-time feedback for field technicians, and secure video conferencing.

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Feb 01

Daily Brief Singapore: Sembcorp Marine, Meta Health Limited and more

By Smartkarma Daily Briefs | Daily Briefs, Singapore

In today’s briefing:

Sembcorp Marine-Keppel O&M Merger Circular Squeaks In Under The Wire – Next Steps
10 in 10 with Meta Health – Digitalising Healthcare

Sembcorp Marine-Keppel O&M Merger Circular Squeaks In Under The Wire – Next Steps

By Travis Lundy

Last Friday, Sembcorp Marine (SMM SP) announced it had Approval-In-Principle for its Proposed Combination with Keppel Corp (KEP SP), contingent on the Circular being despatched by 31 January 2023.
At 6:50pm local time on 31 January, Sembcorp Marine released its 679-page Circular (and EGM Announcement (16 Feb EGM)). Phew!
Now we have a deal in sight, we have to think about next steps. SMM NEWCO needs a story vs flow. Orderbook is nice but may not cut it near-term.

10 in 10 with Meta Health – Digitalising Healthcare

By Geoff Howie

10 in 10 with Meta Health – Digitalising Healthcare

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Feb 01

Daily Brief South Korea: Samsung Biologics and more

By Smartkarma Daily Briefs | Daily Briefs, South Korea

In today’s briefing:

Samsung Biologics (207940 KS): 2022 Revenue Surpassed KRW3T; Strong Growth Momentum to Continue

Samsung Biologics (207940 KS): 2022 Revenue Surpassed KRW3T; Strong Growth Momentum to Continue

By Tina Banerjee

In 2022, Samsung Biologics (207940 KS) posted record-high consolidated revenue of KRW3 trillion and, driven by new orders, efficient plant utilization, and inclusion of Samsung Bioepis as a wholly-owned subsidiary.
Plant 4 is on track to be completed in H12023, with active pre-sale activities are rapidly locking in capacity. Strong order momentum continued, with 2022 CMO contract amount of $9.5B.
Samsung Bioepis reported revenue growth of 12% to KRW946B, driven by stable sales of existing products and new product launch. Humira biosimilar launch in the US is the biggest catalyst.

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✓ Events & Webinars

Feb 01

Daily Brief India: MMP Industries, Lemon Tree Hotels Ltd, Bandhan Bank Ltd, Vedanta Resources and more

By Smartkarma Daily Briefs | Daily Briefs, India

In today’s briefing:

MMP Industries: Forensic Analysis
Lemon Tree Hotels Ltd- Forensic Analysis
Bandhan Bank | The Road Ahead
Morning Views Asia: JSW Infrastructure, Road King Infrastructure, UPL Ltd, Vedanta Resources

MMP Industries: Forensic Analysis

By Nitin Mangal

MMP Industries (MMP IN) is mainly engaged in the business of manufacturing, selling and distribution and trading of aluminum products such as powder, pyro and flake, paste, foils etc.
The company has been on the main board of NSE since F20 but however, its financials are plagued with several forensic concerns.
We highlight takeaways mainly related to negative cash flows and their misrepresentation in reporting standards. Additionally, the company is also engaged in various secretarial audit woes.

Lemon Tree Hotels Ltd- Forensic Analysis

By Nitin Mangal

Lemon Tree Hotels Ltd (LEMONTRE IN) (“LTHL”) is India’s largest mid-market hotel chain with 7 brands and 87 properties across 54 destinations and 8,489 rooms as at F22.
We noticed few setbacks on the forensics, particularly with respect to impairment in subsidiary and unusual accounting with revaluation of PPE.
While the operations have seen a revival in terms of ARR and margins, LTHL however is yet to reach occupancy levels of pre-covid.

Bandhan Bank | The Road Ahead

By Pranav Bhavsar

Bandhan Bank Ltd (BANDHAN IN) reported weak earnings with a flat (-2%) Net Interest Income growth and a +91 YoY growth in provisions.
Additional slippage continues to come primarily from the EEB portfolio. The overall advances recorded is 14% YoY growth driven by the Retail segment, including housing and MSME.
Improvement in customer behaviour in terms of regularizing accounts is a critical component that needs to be verified and checked for the bank to move ahead.

Morning Views Asia: JSW Infrastructure, Road King Infrastructure, UPL Ltd, Vedanta Resources

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.

JSW Infrastructure
Road King Infrastructure
UPL Ltd
Vedanta Resources

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Feb 01

Daily Brief Thailand: Siam Commercial Bank and more

By Smartkarma Daily Briefs | Daily Briefs, Thailand

In today’s briefing:

Siam Commercial Bank (SCB TB) – Traversing Generations

Siam Commercial Bank (SCB TB) – Traversing Generations

By Angus Mackintosh

Siam Commercial Bank (SCB TB) booked a solid set of 4Q2022 results, with the first NIM expansion in two years and record high net interest income.
The bank also provided details of its mothership strategy, which has now come to fruition, with the restructuring process now complete with its increasingly strong digital credentials becoming clearer.
Siam Commercial Bank remains attractive on valuations and probably deserves to trade at a premium to peers given its digital credentials but more data may be required to get there.

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Feb 01

Daily Brief Indonesia: GoTo, Ace Hardware Indonesia, Bank Mandiri Persero and more

By Smartkarma Daily Briefs | Daily Briefs, Indonesia

In today’s briefing:

GoTo: Going Gets Tough
Ace Hardware Indonesia (ACES IJ) – Will Expansion Mode Be Enough?
Bank Mandiri (BMRI IJ) – Brimming with Convenience and Returns

GoTo: Going Gets Tough

By Shifara Samsudeen, ACMA, CGMA

GoTo’s share price lost more than 75% last year following its weaker-than-expected performance and lock-up expiry despite the company entering into a coordinated secondary offering of shares with pre-IPO shareholders.
The company’s share price has moved up 24% YTD partially driven by cost cutting measures that is expected to improve the company’s profitability.
Nevertheless, we expect this share price rebound to be temporary with e-commerce and food delivery market in Indonesia slowing down.

Ace Hardware Indonesia (ACES IJ) – Will Expansion Mode Be Enough?

By Angus Mackintosh

Ace Hardware has been a distinct laggard amongst listed retailers in Indonesia, with its valuations drifting to multi-year lows, given a slow recovery from the pandemic and limited digital strategy.
The company has continued to see lacklustre SSSG finish flat for last year but has recently opined a more optimistic outlook for 2023, planning to open 10-15 new stores.
Ace Hardware Indonesia (ACES IJ) trades on 13.7x FY2023E PER and 12.7x FY2024E PER when it used to trade on twice that multiple with not dissimilar growth rates.

Bank Mandiri (BMRI IJ) – Brimming with Convenience and Returns

By Angus Mackintosh

Bank Mandiri (BMRI IJ) finished the year with a strong showing of loan growth across the board driven by corporate and commercial loans but micro was also a feature.
Both the bank’s consumer app under Livin’ and its digital corporate platform under Kopra continue to help drive CASA growth and transactions plus the bank is opening “smart” branches.
Bank Mandiri (BMRI IJ) is optimistic about the outlook for loan growth and NIMs in 2023, with its digital initiatives continuing to gain traction and drive growth. Valuations are attractive.

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Feb 01

Daily Brief China: I-Mab and more

By Smartkarma Daily Briefs | China, Daily Briefs

In today’s briefing:

I-Mab (IMAB.US) – An “Entertaining Bet”: To Be a Dark Horse or to Fail Completely

I-Mab (IMAB.US) – An “Entertaining Bet”: To Be a Dark Horse or to Fail Completely

By Xinyao (Criss) Wang

Many people aren’t optimistic about CD47 because there is no sufficient evidence to solve blood toxicity. Although I-MAB’s problem-solving idea has no obvious flaws in logic, risks remain.
CD73 is still at a relatively “shallow level”, which can be understood as a low level of verification. I-MAB has to make a last-ditch effort on CD47.
At such low market cap, Investors could make an “entertaining bet”. If CD47 is successful, you can earn several times. If not, then admit the defeat.

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Feb 01

Daily Brief Japan: Keisei Electric Railway Co, Baycurrent Consulting, Toshiba Corp, Oriental Land, Komatsu Ltd, Tokyo Stock Exchange Tokyo Price Index Topix and more

By Smartkarma Daily Briefs | Daily Briefs, Japan

In today’s briefing:

StubWorld: Mickey Upstages Keisei Electric
MSCI Feb 2023 QCIR Preview: Potential Changes as Review Period Ends
Toshiba (6502) – Funding Mostly Secured, Still, Again, Maybe. Or Maybe Not. Or Not.
Oriental Land: Fantasy Springs Is No Longer on Management’s Interest
Toshiba (6502 JP): Financing Deadline Slips Again as the 3Q Update Looms
Komatsu (6301) | Plenty of Gas in the Tank
Board Independence Is Demonstrated by Whether It Is Aligned with Common Shareholder Goal

StubWorld: Mickey Upstages Keisei Electric

By David Blennerhassett

Keisei Electric Railway Co (9009 JP) is trading “cheap” as Oriental Land (4661 JP) enjoys a zero-Covid revival.
Preceding my comments on Keisei/Oriental Land, 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%.

MSCI Feb 2023 QCIR Preview: Potential Changes as Review Period Ends

By Brian Freitas

The review period for the February Quarterly Comprehensive Index Review (QCIR) of the MSCI indices ended yesterday. There will be a number of changes in the Asia Pacific region.
Most of the inclusions are in China and the country weight in the MSCI Emerging Markets Index should increase leading to outflows from other markets.
On average, the potential adds have outperformed the potential deletes over the last few weeks. At a glance, pre-positioning appears to be lighter than in the past.

Toshiba (6502) – Funding Mostly Secured, Still, Again, Maybe. Or Maybe Not. Or Not.

By Travis Lundy

The original bid was supposed to be presented fully-funded by 30 September 2022. Then it was early November, then late November, then early December, late Dec, early Jan, end Jan.
Today we find out that The Banks and The Preferred JIP Bidding Consortium will aim to reach agreement by 3 Feb. The Bloomberg article details are newish, and odd.
Shares have deteriorated and vs Peers, they are at their lowest point in many months. And the details do not make me confident this deal is clean yet.

Oriental Land: Fantasy Springs Is No Longer on Management’s Interest

By Oshadhi Kumarasiri

Aided by the Japanese Government’s efforts to rebuild the COVID-ravaged leisure sector, Oriental Land (4661 JP)’s 3QFY23 OP surpassed consensus by more than 35%.
We believe 3QFY23 could be a peak in terms of financial performance for Oriental Land, at least until the opening of the Fantasy Springs.
In addition, the growth story that OLC offered through the expansion of DisneySea, seems to be no longer compelling as the management has simply stopped talking about its progress.

Toshiba (6502 JP): Financing Deadline Slips Again as the 3Q Update Looms

By Arun George

Bloomberg reports that Japan Industrial Partners (JIP), the preferred bidder, has again extended the deadline for securing bank financing of around JPY1.2 trillion (US$8.8 billion).
A new issue has pushed the deadline to 3 February. If JIP manages to secure financing for an offer of around JPY5,100, the next challenge is securing Board support.
The 3QFY2022 update on 14 February needs to avoid further downgrades to keep the deal alive. Toshiba’s multiples are unattractive to peers. Remain on the sidelines for now.

Komatsu (6301) | Plenty of Gas in the Tank

By Mark Chadwick

Komatsu Q3 operating profit rose 54% YoY, beating analyst estimates by around 12%
Construction and Mining Equipment sales rose 31% in the quarter, or ~10% on a constant currency basis versus industry volume of -6%
Komatsu shares have sharply lagged the recovery at CAT. We still see significant upside with current P/B of 1.2x

Board Independence Is Demonstrated by Whether It Is Aligned with Common Shareholder Goal

By Aki Matsumoto

While shareholder proposals, including those from activist investors, should be considered from independent perspective, it’s clear that even companies with high-% independent directors don’t necessarily get along with activist investors.
Board independence is not a question of the number or ratio of independent directors; rather, it is a question of whether independent directors are truly functioning on the board.
If the loss of cash results in missed investment opportunities to expand corporate value, this would conflict with interests of shareholders, so subsequent increases in market capitalization should be verified.

💡 Before it’s here, it’s on Smartkarma

The Smartkarma Preview Pass is your entry to the Independent Investment Research Network

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✓ Company Data and News
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