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Smartkarma Daily Briefs

Daily Brief Industrials: Doosan Enerbility, Doosan Corp, Antony Waste Handling Cell Limited, Shenzhen International and more

By | Daily Briefs, Industrials

In today’s briefing:

  • Doosan Enerbility Placement – Selldown by Parent Doesn’t Send the Best Signal
  • Doosan Corp: A Block Deal Sale of 4.5% Stake in Doosan Enerbility
  • Antony Waste Handling Cell Ltd – Forensic Analysis
  • Shenzhen Intl (152 HK): The Toughest Time Should Be over Now

Doosan Enerbility Placement – Selldown by Parent Doesn’t Send the Best Signal

By Clarence Chu

  • Doosan Corp (000150 KS) is looking to raise up to US$435m from trimming a portion of its stake in Doosan Enerbility (034020 KS).
  • The deal isn’t exactly a large one to process at just 5.2 days of three month ADV. Shares are offered at a discount range between 5.1-7.8%.
  • As there wasn’t a specific mention of the former’s intention to sell, we would argue that the deal isn’t particularly well flagged.

Doosan Corp: A Block Deal Sale of 4.5% Stake in Doosan Enerbility

By Douglas Kim

  • After the market close today, Doosan Corp (000150 KS) announced that it plans to sell a 4.5% stake in Doosan Enerbility (034020 KS) in a block deal sale.
  • The discount range on the block deal price is 5.1% to 7.8% based on today’s closing price of 21,700 won.
  • This block deal sale should have a positive impact on Doosan Corp but a negative impact on Doosan Enerbility.

Antony Waste Handling Cell Ltd – Forensic Analysis

By Nitin Mangal

  • Antony Waste Handling Cell Limited (AWHCL IN) is one of the key players operating in the Municipal Solid Waste (MSW) industry.
  • Key takeaways that warrant attention overlooked include disparity between accounting and management commentary on margins and reimbursements and stained auditor qualifications since F13
  • Other forensic checks consist of poor quality of debtors, subsidiary stress and few eye-brow raising related party transactions.

Shenzhen Intl (152 HK): The Toughest Time Should Be over Now

By Osbert Tang, CFA

  • The 1H22 result of Shenzhen International (152 HK) is 4% ahead of indicated in profit warning. Key drags are toll roads and Shenzhen Airlines, but their 2H22 outlook is better.
  • It will see many new logistics projects to commence operations in the next 12-18 months. Also, SZI guided that it will continue to realise underlying asset value through strategic disposals.
  • We think the toughest time should be behind and expect more positive news on asset gains. The stock is very cheap at 0.41x P/B and 58% discount to appraised NAV. 

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Daily Brief United States: Elastic NV, Invesco Solar ETF, Lam Research, Palantir Technologies Inc, Teladoc Health, Inc., Gilead Sciences, Nike, Boston Scientific and more

By | Daily Briefs, United States

In today’s briefing:

  • Observability Pair Trade: Long Elastic / Short Splunk
  • Headwinds Persist, Including Rising DXY, 10-Yr Treasury Yield, & Commodities; Buying Staples, Solar
  • Lam Research: New Facility In South Korea & Other Developments
  • Palantir Technologies: Partnership With Google Cloud & Other Drivers
  • Teladoc Inc: Major Drivers
  • Gilead Sciences: The MiroBio Acquisition & Other Drivers
  • Sporting Crypto – August 30th 2022: Nike have made $185 million from NFTs
  • Boston Scientific: Major Drivers

Observability Pair Trade: Long Elastic / Short Splunk

By Aaron Gabin

  • Like PANW and SNOW, Elastic continues to power through macro headwinds seen by many other software companies.
  • Elastic has a Crowdstrike like dynamic, where it is capturing new workloads from incumbents, in the cloud. In this case, Symantec’s share donator role is being played by Splunk.
  • In this tough volatile environment, we like an observability pair trade of Long ESTC / Short SPLK.

Headwinds Persist, Including Rising DXY, 10-Yr Treasury Yield, & Commodities; Buying Staples, Solar

By Joe Jasper

  • In last week’s Compass (Aug. 23) we discussed the increasing odds for a deeper pullback in the broad market indexes.
  • This was due to 5-week uptrend breaks on the SPX, NDX, and Russell 2000, the Fed tightening, and with Treasury yields, the U.S. dollar (DXY), and commodities (DJP) inflecting higher.
  • The market remains in pullback mode; the SPX, NDX, and Russell 2000 are all approaching 50-day MA support, the first big area of interest on this pullback.

Lam Research: New Facility In South Korea & Other Developments

By Baptista Research

  • Lam Research gave a solid performance in this quarter.
  • In the quarter, Lam announced the expansion of collaborations within the EUV ecosystem.
  • In the quarter, the company continues to see great momentum with its installed and product base initiatives, with CSPG revenues and foundry logic systems reaching new highs.

Palantir Technologies: Partnership With Google Cloud & Other Drivers

By Baptista Research

  • Palantir Technologies is seeing progress in its revenue growth in the commercial market in the United States and has scaled its revenues significantly from $39 million in Q2 2021 to $86 million this quarter.
  • The company surpassed the revenue expectations of Wall Street and this was driven by their U.S. commercial business which increased by 120%.
  • For the past four quarters, their core U.S. commercial business, excluding strategic investments, has grown by 10% or more quarter-over-quarter, most recently hitting $67.4 million, representing a 14% sequential increase.

Teladoc Inc: Major Drivers

By Baptista Research

  • Teladoc delivered a mixed result and managed to surpass Wall Street expectations on the revenue front but its losses were more than market expectations.
  • The management continues its efforts towards creating solutions that change how customers engage with the healthcare system.
  • This growth builds on the company’s current relationship in chronic care and will give plan members access to a wide range of integrated primary and chronic care options.

Gilead Sciences: The MiroBio Acquisition & Other Drivers

By Baptista Research

  • Gilead had a very robust second quarter with total product sales of $5.7 billion, up 7% year over year, excluding Veklury.
  • The company managed to deliver an all-around beat powered by HIV, cell therapy, and Trodelvy, partially offset by HCV.
  • Sequentially, total product sales excluding Veklury increased by 14%, driven by seasonal pricing and inventory dynamics, especially in their HIV business, and increased demand across the whole portfolio.

Sporting Crypto – August 30th 2022: Nike have made $185 million from NFTs

By Sporting Crypto

  • The NFT bubble has popped. You only have to look at the volumes to know this is true.
  • But regardless of the bubble popping — I can tell you for certain — NFTs are still a HUGE talking point at almost every consumer facing company.
  • CMOs and strategy directors will be asked in boardrooms; what is our Web3 strategy?

Boston Scientific: Major Drivers

By Baptista Research

  • Boston Scientific’s innovation portfolio, commercial execution, clinical data, and strategic tuck-in M&A supported its solid second-quarter results where the company delivered an all-around beat.
  • Furthermore, their Diagnostics business performed well during the quarter because of the Preventice portfolio and implantable cardiac LUX-Dx.
  • Despite the macroeconomic difficulties Boston continues to be well-positioned for a decent 2022 ahead given their category leadership strategy, commercial execution, and robust portfolio.

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Daily Brief Indonesia: Link Net, Ace Hardware Indonesia, Agile Property Holdings and more

By | Daily Briefs, Indonesia

In today’s briefing:

  • Link Net: Axiata’s MTO Kicks Off Today
  • Ace Hardware (ACES IJ) – A Rebound in the Offing
  • Morning Views Asia: ABM Investama, Adaro Minerals

Link Net: Axiata’s MTO Kicks Off Today

By David Blennerhassett

  • After Axiata  (AXIATA MK) completed the acquisition of 66.03% in Link Net (LINK IJ) on the 22 June, Axiata was obligated to undertake a mandatory offer for the remaining 33.97%. 
  • The MTO commences today and concludes on the 28 September. Payment will be the 6 October.
  • There are no conditions attached to the MTO. Play the spread, where available.

Ace Hardware (ACES IJ) – A Rebound in the Offing

By Angus Mackintosh

  • Ace Hardware Indonesia (ACES IJ) 1H2022 results continued to reflect a hangover from COVID-19 in terms of slower growth although the company continues to demonstrate its resilience.
  • The company’s store expansion continues with plans for 15 stores in total for 2022, whilst SSSG have seen a sharp recovery recently bringing YTD SSSG into positive territory.
  • Ace Hardware is one of Indonesia’s top quality retailers with the potential for a sharp recovery and valuation looks attractive on 15x FY2023E PER versus 27x 5-year average PER.

Morning Views Asia: ABM Investama, Adaro Minerals

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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Daily Brief Energy/Materials: Korea Zinc, West China Cement and more

By | Daily Briefs, Energy & Materials Sector

In today’s briefing:

  • A Separation of Korea Zinc Group & Young Poong Group by the Choi & Jang Families?
  • West China Cement – Earnings Flash – H1 FY 2022 Results – Lucror Analytics

A Separation of Korea Zinc Group & Young Poong Group by the Choi & Jang Families?

By Douglas Kim

  • The history of Young Poong Group goes back nearly 73 years ago in 1949 when two young men Ki-ho Choi and Byeong-hee Jang founded Young Poong.
  • Young Poong Group and Korea Zinc could be separated from each other with the Choi family controlling Korea Zinc and Jang family controlling Young Poong and related affiliates.
  • The bullish case for Young Poong and Korea Zinc would be that once they are separated, there could be greater management transparency and ownership structure which could boost overall efficiency. 

West China Cement – Earnings Flash – H1 FY 2022 Results – Lucror Analytics

By Leonard Law, CFA

West China Cement’s H1/22 results were in line with expectations. The company reported broad sales volume declines across all regions in China, owing to pandemic-related disruptions. Still, its revenue and gross margin were largely stable, as the better-than-expected ASP growth was able to offset increases in coal and electricity costs. Moreover, the FCF deficit was smaller than anticipated, as capex fell y-o-y. Net Debt/EBITDA weakened slightly, but remained strong at 1.8x (FYE 2021: 1.6x). Management anticipates more meaningful earnings growth and margin expansion in FY 2023, supported by the contribution from its new plant in Congo (expected to commence at end-2022).


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Daily Brief Utilities: Adani Total Gas, CGN Power and more

By | Daily Briefs, Utilities Sector

In today’s briefing:

  • S&P BSE Quiddity Leaderboard Dec 2022: Multiple Adani Names with F&O Question Marks
  • CGN Power (1816 HK): No Nuclear Jitters
  • CGN Power (1816 HK): Building up Stronger Potential

S&P BSE Quiddity Leaderboard Dec 2022: Multiple Adani Names with F&O Question Marks

By Janaghan Jeyakumar, CFA

  • In this insight, we take a look at the names leading the race to become ADDs/DELs for the BSE SENSEX, 100, 200, and 500 Indices in the December 2022 Rebalance.
  • Based on the latest data, I expect one ADD/DEL for SENSEX, one ADD/DEL for BSE 100, and 3 ADDs/DELs for BSE 200. 
  • The potential ADDs/DELs for SENSEX could see index flows of US$100mn or more but the other index changes are both small in size and volume impact (days-to-trade).

CGN Power (1816 HK): No Nuclear Jitters

By David Blennerhassett

  • Nuclear power is a clean energy source that contributes to energy savings and emissions reduction in society.
  • SASAC backed CGN Power (1816 HK) is China’s leading nuclear play, accounting for 55% of on-grid nuclear power generation, but just 1.2% of China’s total installed capacity of power generation.
  • As one of the few listed nuclear -plays in Asia, CGN trades at undemanding multiples, together with an attractive ROE and yield.

CGN Power (1816 HK): Building up Stronger Potential

By Osbert Tang, CFA

  • CGN Power (1816 HK), as China’s largest nuclear power company, has its profit outperformed coal-fired and wind power peers in 1H22 given its stable cost control and higher tariff.  
  • We expect contribution from Hongyanhe #6, normalised operations from existing projects, further margin expansion, solid project pipeline and positive new project potential to be the key earnings drivers. 
  • Its target to reach capacity of 70GW by 2035 should underpin long-term outlook. YTD, the stock has outperformed most peers, yet valuation multiples are still cheaper than peer average.

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Daily Brief China: Baidu, CGN Power, Leapmotor, Shenzhen International, Pinduoduo, Health And Happiness (H&H), Hangzhou Tigermed Consulting (A), West China Cement and more

By | China, Daily Briefs

In today’s briefing:

  • HSI, HSCEI, HSTECH: September Rebalance Flows Post Capping
  • CGN Power (1816 HK): No Nuclear Jitters
  • Leapmotor IPO – Index Inclusion Timeline
  • Leapmotor IPO: Look Before You Leap
  • Shenzhen Intl (152 HK): The Toughest Time Should Be over Now
  • Pinduoduo: Management Warns That 2Q22 Is Not a Good Benchmark For Future
  • H&H International – Earnings Flash – H1 FY 2022 Results – Lucror Analytics
  • Hangzhou Tigermed Consulting (3347.HK/300347.CH) 2022H1 – The Time Bomb Is Ticking
  • Leapmotor Pre-IPO – Peer Comparison – One of the Leaders in 2Q Volumes but Lags on Margins
  • West China Cement – Earnings Flash – H1 FY 2022 Results – Lucror Analytics

HSI, HSCEI, HSTECH: September Rebalance Flows Post Capping

By Brian Freitas


CGN Power (1816 HK): No Nuclear Jitters

By David Blennerhassett

  • Nuclear power is a clean energy source that contributes to energy savings and emissions reduction in society.
  • SASAC backed CGN Power (1816 HK) is China’s leading nuclear play, accounting for 55% of on-grid nuclear power generation, but just 1.2% of China’s total installed capacity of power generation.
  • As one of the few listed nuclear -plays in Asia, CGN trades at undemanding multiples, together with an attractive ROE and yield.

Leapmotor IPO – Index Inclusion Timeline

By Brian Freitas

  • Leapmotor (2007699D HK) is said to be looking to raise between US$1bn-US$1.5bn by selling 290.9m shares in its IPO. At the top end, the company will be valued at HK$53bn.
  • The performance of its peers over the last year leaves a lot to be desired and could lead to lower demand in the IPO.
  • Leapmotor (2007699D HK) should be added to the HSCI and the Hang Seng Tech Index, though timing depends on when the stock lists on the HKEX (388 HK)

Leapmotor IPO: Look Before You Leap

By Arun George

  • Leapmotor (2007699D HK), a Chinese EV manufacturer, is pre-marketing a US$1.5 billion HKEx IPO, according to press reports.
  • We previously discussed the IPO in Leapmotor IPO: The Bull Case and Leapmotor IPO: The Bear Case. This note updates our view for the PHIP and recent developments.
  • While the 1Q and truncated 1H numbers outline rapid growth and declining loss margin, key metrics continue to lag peers over comparable periods. We would pass on the IPO. 

Shenzhen Intl (152 HK): The Toughest Time Should Be over Now

By Osbert Tang, CFA

  • The 1H22 result of Shenzhen International (152 HK) is 4% ahead of indicated in profit warning. Key drags are toll roads and Shenzhen Airlines, but their 2H22 outlook is better.
  • It will see many new logistics projects to commence operations in the next 12-18 months. Also, SZI guided that it will continue to realise underlying asset value through strategic disposals.
  • We think the toughest time should be behind and expect more positive news on asset gains. The stock is very cheap at 0.41x P/B and 58% discount to appraised NAV. 

Pinduoduo: Management Warns That 2Q22 Is Not a Good Benchmark For Future

By Oshadhi Kumarasiri

  • Pinduoduo (PDD US)’s 2Q22 was rather strong with revenue of RMB 31.4bn (consensus: RMB 23.6bn) and OP of RMB 8.7bn (consensus: RMB 3.6bn).
  • However, the management was quick to dismiss the pretence that piduoduo would be able to maintain these elevated growth/margin numbers throughout the rest of the year and over the medium-term.
  • This creates a lot of downside to consensus 2H22 and medium-term revenue and OP estimates in a time when valuation multiples have expanded over 70% from the March 2022 bottom.

H&H International – Earnings Flash – H1 FY 2022 Results – Lucror Analytics

By Shu Hui Woon

H&H International’s H1/22 results were adequate in our view, despite the challenging operating conditions in China. The company is gradually diversifying its businesses, with ANC and PNC accounting for 48% of total H1/22 revenue. Moreover, demand for PNC products is increasing, and H&H is focused on leveraging this to expand in the US and China. The Swiss brand under ANC is also growing steadily. Going forward, these would allow the company to balance any revenue decline from the intensified BNC business. H&H has a moderate financial risk profile overall, with sound liquidity.


Hangzhou Tigermed Consulting (3347.HK/300347.CH) 2022H1 – The Time Bomb Is Ticking

By Xinyao (Criss) Wang

  • Tigermed had high revenue growth in 2022H1 but with a YoY decrease in net profit attributable to the owners of the Company, mainly due to poor performance of investment business.
  • Tigermed’s investment business is like a “time bomb” that would detonate in the future. Its “CRO+PE/VC business model” would trap its performance in a vicious circle due to unfriendly macro.  
  • We are conservative about Tigermed’s outlook and performance. Tigermed is difficult to achieve the V-shaped rebound. So we recommend investors to offload, or just do some short term trade.

Leapmotor Pre-IPO – Peer Comparison – One of the Leaders in 2Q Volumes but Lags on Margins

By Sumeet Singh

  • Leapmotor (LM) aims to raise around US$1.5bn in its Hong Kong IPO. LM is a smart EV company based in China, founded in 2015.
  • As of end Jun 22, it had delivered a total of 104,829 cars with most of its sales coming from its mini units, T03.
  • In our previous notes, we spoke about the company’s past performance and its PHIP updates. In this note, we will undertake a peer comparison.

West China Cement – Earnings Flash – H1 FY 2022 Results – Lucror Analytics

By Leonard Law, CFA

West China Cement’s H1/22 results were in line with expectations. The company reported broad sales volume declines across all regions in China, owing to pandemic-related disruptions. Still, its revenue and gross margin were largely stable, as the better-than-expected ASP growth was able to offset increases in coal and electricity costs. Moreover, the FCF deficit was smaller than anticipated, as capex fell y-o-y. Net Debt/EBITDA weakened slightly, but remained strong at 1.8x (FYE 2021: 1.6x). Management anticipates more meaningful earnings growth and margin expansion in FY 2023, supported by the contribution from its new plant in Congo (expected to commence at end-2022).


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Daily Brief TMT/Internet: Baidu, SK Telecom Co Ltd (Adr), Nitro Software Ltd, Prosus , Link Net, Elastic NV, Delta Electronics, SDI Corporation, Micro Focus International, Invesco Solar ETF and more

By | Daily Briefs, TMT/Internet

In today’s briefing:

  • HSI, HSCEI, HSTECH: September Rebalance Flows Post Capping
  • SKT ADR Play on the 31st for MSCI Exclusion
  • Nitro’s Opportunistic A$1.58 Offer from Potentia
  • Prosus: 30% Discount Seems About Right
  • Link Net: Axiata’s MTO Kicks Off Today
  • Observability Pair Trade: Long Elastic / Short Splunk
  • Delta Electronics: Taiwan Vs. Thailand Pairs Monitor, Call with Management
  • Two Niche Semiconductor Industry Stocks Highly Exposed to EV Acceleration
  • Open Text/Micro Focus: Next Chapter in an Acquisition Growth Story
  • Headwinds Persist, Including Rising DXY, 10-Yr Treasury Yield, & Commodities; Buying Staples, Solar

HSI, HSCEI, HSTECH: September Rebalance Flows Post Capping

By Brian Freitas


SKT ADR Play on the 31st for MSCI Exclusion

By Sanghyun Park

  • We need a hedge to short SKT on the 31st. For this, we need to consider trading SKT ADR, which is pretty liquid as DTV reaches nearly $8mil.
  • The play structure is simple. It exploits the pattern that passive flow is concentrated on underlying shares rather than ADRs. We witnessed this pattern in the last two cases.
  • Passive outflow may be aggravated since SKT leaves not only STANDARD but also sub-indices such as ESG. So, the degree of a temporary DR premium can get thicker.

Nitro’s Opportunistic A$1.58 Offer from Potentia

By Arun George

  • Nitro Software Ltd (NTO AU) entered a trading halt in response to an AFR report that Potentia has lobbed an indicative non-binding proposal at A$1.58 per share.
  • Potentia’s offer follows its success in securing a 17% stake at A$1.58 per share on Monday night. The stake is large enough to deter rival schemes. 
  • The offer is opportunistic and unattractive. However, the ability of Potentia to relatively quickly secure a significant stake suggests that the Board will be under pressure to engage.

Prosus: 30% Discount Seems About Right

By Wium Malan, CFA

  • The initial impact, of the share repurchase program, was for Prosus’ simple discount to listed NAV to reduce from roughly 50% to around 25% within 4 weeks of implementation.
  • The weekly size of the share repurchase program has been reduced by ~40%, on a 4-week rolling average basis, since the discount has been below 30%.
  • We remain constructive on Tencent and, with Prosus at 25% or less simple discount to NAV, would own Tencent directly (long-only), or be long Tencent, short Prosus/Naspers.

Link Net: Axiata’s MTO Kicks Off Today

By David Blennerhassett

  • After Axiata  (AXIATA MK) completed the acquisition of 66.03% in Link Net (LINK IJ) on the 22 June, Axiata was obligated to undertake a mandatory offer for the remaining 33.97%. 
  • The MTO commences today and concludes on the 28 September. Payment will be the 6 October.
  • There are no conditions attached to the MTO. Play the spread, where available.

Observability Pair Trade: Long Elastic / Short Splunk

By Aaron Gabin

  • Like PANW and SNOW, Elastic continues to power through macro headwinds seen by many other software companies.
  • Elastic has a Crowdstrike like dynamic, where it is capturing new workloads from incumbents, in the cloud. In this case, Symantec’s share donator role is being played by Splunk.
  • In this tough volatile environment, we like an observability pair trade of Long ESTC / Short SPLK.

Delta Electronics: Taiwan Vs. Thailand Pairs Monitor, Call with Management

By Vincent Fernando, CFA

  • We had a call with Delta Electronics (2308 TT) management to understand the company’s latest developments, particularly in relation to its growing automotive and EV businesses.
  • Delta Thailand shares have rallied 55.4% in T$ terms, while Delta Taiwan has only rallied 9.3%.
  • Delta’s EV business is growing 50% per year and has major customers including Tesla, GM, and Volkswagen, however, our sense is the Taiwan entity has an advantage. 

Two Niche Semiconductor Industry Stocks Highly Exposed to EV Acceleration

By Vincent Fernando, CFA

  • SDI Corporation (2351 TT) and Jih Lin Technology (5285 TT) are well positioned to generate significant long-term business from automotive end-market chip demand.
  • The companies are the #1 and #2 leaders globally by market share respectively for power lead frames.
  • Could receive earnings upgrades if CEV to EV market expectations are pulled forward.

Open Text/Micro Focus: Next Chapter in an Acquisition Growth Story

By Jesus Rodriguez Aguilar

  • Open Text agreed a 532p/share cash offer for legacy software, highly leveraged FTSE250 constituent, Micro Focus (98% premium, 2.3x EV/Fwd Revenues, 6.4x EV/Fwd EBITDA), taking advantage of target’s downwards re-rating.
  • My TP based (5.6x EV/Fwd EBITDA based) is 350p, which reflects macro challenges. Although the offer from Open Text seems every generous, ROIC could reach low single teens.
  • Gross spread is 2.35% and the estimated annual return would be 4.38% assuming settlement by mid-February. Irrevocables amount to 16.62%, the lengthy part will be antitrust and FDI approvals. Long.

Headwinds Persist, Including Rising DXY, 10-Yr Treasury Yield, & Commodities; Buying Staples, Solar

By Joe Jasper

  • In last week’s Compass (Aug. 23) we discussed the increasing odds for a deeper pullback in the broad market indexes.
  • This was due to 5-week uptrend breaks on the SPX, NDX, and Russell 2000, the Fed tightening, and with Treasury yields, the U.S. dollar (DXY), and commodities (DJP) inflecting higher.
  • The market remains in pullback mode; the SPX, NDX, and Russell 2000 are all approaching 50-day MA support, the first big area of interest on this pullback.

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Daily Brief Health Care: Hangzhou Tigermed Consulting (A), Boston Scientific, Gilead Sciences, Oneness Biotech, Teladoc Health, Inc. and more

By | Daily Briefs, Healthcare

In today’s briefing:

  • Hangzhou Tigermed Consulting (3347.HK/300347.CH) 2022H1 – The Time Bomb Is Ticking
  • Boston Scientific: Major Drivers
  • Gilead Sciences: The MiroBio Acquisition & Other Drivers
  • Oneness Biotech (4743 TT): Positive Clinical Trial Progress Is Pushing Stock Prices to Higher Highs
  • Teladoc Inc: Major Drivers

Hangzhou Tigermed Consulting (3347.HK/300347.CH) 2022H1 – The Time Bomb Is Ticking

By Xinyao (Criss) Wang

  • Tigermed had high revenue growth in 2022H1 but with a YoY decrease in net profit attributable to the owners of the Company, mainly due to poor performance of investment business.
  • Tigermed’s investment business is like a “time bomb” that would detonate in the future. Its “CRO+PE/VC business model” would trap its performance in a vicious circle due to unfriendly macro.  
  • We are conservative about Tigermed’s outlook and performance. Tigermed is difficult to achieve the V-shaped rebound. So we recommend investors to offload, or just do some short term trade.

Boston Scientific: Major Drivers

By Baptista Research

  • Boston Scientific’s innovation portfolio, commercial execution, clinical data, and strategic tuck-in M&A supported its solid second-quarter results where the company delivered an all-around beat.
  • Furthermore, their Diagnostics business performed well during the quarter because of the Preventice portfolio and implantable cardiac LUX-Dx.
  • Despite the macroeconomic difficulties Boston continues to be well-positioned for a decent 2022 ahead given their category leadership strategy, commercial execution, and robust portfolio.

Gilead Sciences: The MiroBio Acquisition & Other Drivers

By Baptista Research

  • Gilead had a very robust second quarter with total product sales of $5.7 billion, up 7% year over year, excluding Veklury.
  • The company managed to deliver an all-around beat powered by HIV, cell therapy, and Trodelvy, partially offset by HCV.
  • Sequentially, total product sales excluding Veklury increased by 14%, driven by seasonal pricing and inventory dynamics, especially in their HIV business, and increased demand across the whole portfolio.

Oneness Biotech (4743 TT): Positive Clinical Trial Progress Is Pushing Stock Prices to Higher Highs

By Tina Banerjee

  • Oneness Biotech (4743 TT) is showing steady progress in its R&D pipeline. The company submitted IND application to FDA for phase 1 trial of SNS812 for the treatment of COVID-19.
  • SNS812 is a first-in-class broad-spectrum siRNA-based new drug against SARS-CoV-2 variants covering 99.8% of current variants and shown picomolar inhibition of dominant ones, including Alpha, Delta, Gamma, Epsilon, and Omicron.
  • The health authorities in Singapore, Malaysia, the Philippines, and Vietnam have accepted the NDA application of Fespixon, which has been commercialized in Taiwan last year for diabetes foot ulcer.

Teladoc Inc: Major Drivers

By Baptista Research

  • Teladoc delivered a mixed result and managed to surpass Wall Street expectations on the revenue front but its losses were more than market expectations.
  • The management continues its efforts towards creating solutions that change how customers engage with the healthcare system.
  • This growth builds on the company’s current relationship in chronic care and will give plan members access to a wide range of integrated primary and chronic care options.

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Daily Brief Financials: Farglory Land Development, ICICI Bank Ltd, Banco Do Brasil Sa, Agile Property Holdings and more

By | Daily Briefs, Financials

In today’s briefing:

  • A Taiwan Basket Trade For A Special Index Rebal
  • Finding Leadership Within Emerging Markets
  • June Brazil Bank Data in Twelve Charts – Credit Spreads Keep Rising, NPLs More Benign
  • Morning Views Asia: ABM Investama, Adaro Minerals

A Taiwan Basket Trade For A Special Index Rebal

By Travis Lundy

  • The FTSE TWSE Taiwan indices get rebalanced in line with the standard FTSE Global indices – on the third Friday of September. 
  • The most interesting one is the probably the least famous. It has only one change but it has massive re-weightings because of the way the index is constructed. 
  • Historical patterns suggest a right-way long-short basket, reversed on the event, is a good trade.

Finding Leadership Within Emerging Markets

By Joe Jasper

  • We are starting to see early signs of a potential bottom on MSCI EM (EEM-US).
  • Specifically, the EEM-US has reversed topside its 6-month downtrend. If MSCI EM has indeed bottomed, we want to be buying the leaders; that is where this report comes in.
  • Specific themes include attractive opportunities in India and Thailand, and also many in Taiwan and South Korea. Attractive Sectors include Energy, Financials, Materials, and Industrials.

June Brazil Bank Data in Twelve Charts – Credit Spreads Keep Rising, NPLs More Benign

By Victor Galliano

  • Brazil’s consumer credit quality trends to June showed an improvement across most series, with the exception of the credit cards category
  • System loan growth was +17.8% for the twelve months to June, an acceleration from the YoY rate for May (+16.9%), due largely to the pick-up in corporate loan growth
  • The BCB’s latest consensus estimates suggest that benchmark rate have now peaked at 13.75%; our preferred Brazilian bank remains Banco do Brasil, for good credit quality and attractive valuations

Morning Views Asia: ABM Investama, Adaro Minerals

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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Daily Brief Consumer: Leapmotor, Ace Hardware Indonesia, Pinduoduo, Health And Happiness (H&H), Nike, Tokyo Stock Exchange Tokyo Price Index Topix and more

By | Consumer, Daily Briefs

In today’s briefing:

  • Leapmotor IPO – Index Inclusion Timeline
  • Leapmotor IPO: Look Before You Leap
  • Ace Hardware (ACES IJ) – A Rebound in the Offing
  • Pinduoduo: Management Warns That 2Q22 Is Not a Good Benchmark For Future
  • H&H International – Earnings Flash – H1 FY 2022 Results – Lucror Analytics
  • Leapmotor Pre-IPO – Peer Comparison – One of the Leaders in 2Q Volumes but Lags on Margins
  • Sporting Crypto – August 30th 2022: Nike have made $185 million from NFTs
  • The Crux of the Problem Is the Company’s Reluctance to Increase the Number of Diverse Shareholders

Leapmotor IPO – Index Inclusion Timeline

By Brian Freitas

  • Leapmotor (2007699D HK) is said to be looking to raise between US$1bn-US$1.5bn by selling 290.9m shares in its IPO. At the top end, the company will be valued at HK$53bn.
  • The performance of its peers over the last year leaves a lot to be desired and could lead to lower demand in the IPO.
  • Leapmotor (2007699D HK) should be added to the HSCI and the Hang Seng Tech Index, though timing depends on when the stock lists on the HKEX (388 HK)

Leapmotor IPO: Look Before You Leap

By Arun George

  • Leapmotor (2007699D HK), a Chinese EV manufacturer, is pre-marketing a US$1.5 billion HKEx IPO, according to press reports.
  • We previously discussed the IPO in Leapmotor IPO: The Bull Case and Leapmotor IPO: The Bear Case. This note updates our view for the PHIP and recent developments.
  • While the 1Q and truncated 1H numbers outline rapid growth and declining loss margin, key metrics continue to lag peers over comparable periods. We would pass on the IPO. 

Ace Hardware (ACES IJ) – A Rebound in the Offing

By Angus Mackintosh

  • Ace Hardware Indonesia (ACES IJ) 1H2022 results continued to reflect a hangover from COVID-19 in terms of slower growth although the company continues to demonstrate its resilience.
  • The company’s store expansion continues with plans for 15 stores in total for 2022, whilst SSSG have seen a sharp recovery recently bringing YTD SSSG into positive territory.
  • Ace Hardware is one of Indonesia’s top quality retailers with the potential for a sharp recovery and valuation looks attractive on 15x FY2023E PER versus 27x 5-year average PER.

Pinduoduo: Management Warns That 2Q22 Is Not a Good Benchmark For Future

By Oshadhi Kumarasiri

  • Pinduoduo (PDD US)’s 2Q22 was rather strong with revenue of RMB 31.4bn (consensus: RMB 23.6bn) and OP of RMB 8.7bn (consensus: RMB 3.6bn).
  • However, the management was quick to dismiss the pretence that piduoduo would be able to maintain these elevated growth/margin numbers throughout the rest of the year and over the medium-term.
  • This creates a lot of downside to consensus 2H22 and medium-term revenue and OP estimates in a time when valuation multiples have expanded over 70% from the March 2022 bottom.

H&H International – Earnings Flash – H1 FY 2022 Results – Lucror Analytics

By Shu Hui Woon

H&H International’s H1/22 results were adequate in our view, despite the challenging operating conditions in China. The company is gradually diversifying its businesses, with ANC and PNC accounting for 48% of total H1/22 revenue. Moreover, demand for PNC products is increasing, and H&H is focused on leveraging this to expand in the US and China. The Swiss brand under ANC is also growing steadily. Going forward, these would allow the company to balance any revenue decline from the intensified BNC business. H&H has a moderate financial risk profile overall, with sound liquidity.


Leapmotor Pre-IPO – Peer Comparison – One of the Leaders in 2Q Volumes but Lags on Margins

By Sumeet Singh

  • Leapmotor (LM) aims to raise around US$1.5bn in its Hong Kong IPO. LM is a smart EV company based in China, founded in 2015.
  • As of end Jun 22, it had delivered a total of 104,829 cars with most of its sales coming from its mini units, T03.
  • In our previous notes, we spoke about the company’s past performance and its PHIP updates. In this note, we will undertake a peer comparison.

Sporting Crypto – August 30th 2022: Nike have made $185 million from NFTs

By Sporting Crypto

  • The NFT bubble has popped. You only have to look at the volumes to know this is true.
  • But regardless of the bubble popping — I can tell you for certain — NFTs are still a HUGE talking point at almost every consumer facing company.
  • CMOs and strategy directors will be asked in boardrooms; what is our Web3 strategy?

The Crux of the Problem Is the Company’s Reluctance to Increase the Number of Diverse Shareholders

By Aki Matsumoto

  • If stock price is high, then a stock split is the way to go, and stockbrokers have provided a mechanism for trading shares in less than single-unit in the past.
  • The issue isn’t “the trading unit should be lowered because people can’t buy shares with high stock prices” but “let’s improve so that people can become shareholders with one share.
  • If Japanese companies are reluctant to increase the number of diverse shareholders, this would be in line with their slower progress in solving issues: diversity, human rights, and environment.

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