Smartkarma Daily Briefs

Inside is a recap of movements in the last week relating to the Hong Kong Stock-Shanghai and Shenzhen Northbound Connect facilities, broken down by company and industry.
Overall, net inflow was ~US$6.5bn, split between Shanghai (+US$5.5bn) and Shenzhen (+US$1.0bn).
The largest inflows were into LONGi Green Energy Technology (601012 CH) and Kweichow Moutai (600519 CH). The largest outflows were in CATL (300750 CH) and Cosco Shipping Holdings (601919 CH).

Before it’s here, it’s on Smartkarma

Jun 11

Financials: HKEX, Bank Mandiri Persero, NU Holdings Ltd and more

By Smartkarma Daily Briefs | Daily Briefs, Financials

In today’s briefing:

Shanghai/Shenzhen Southbound Connect: Weekly Moves (9 June 2022)
Bank Mandiri (BMRI IJ) – Upping the Ante on Returns
Brazil Digital Banks – Nubank and Banco Inter Shares Have De-Rated, but Still Face Challenges

Shanghai/Shenzhen Southbound Connect: Weekly Moves (9 June 2022)

Inside is a recap of movements in the last week relating to the Shanghai and Shenzhen-Hong Kong Stock Connect facilities, broken down by company and industry.
Overall, net inflow was ~US$0.6bn, split (roughly) <US$0.1bn for Shanghai and US$0.5bn for Shenzhen.
The largest inflows were into Kuaishou Technology (1024 HK) and Wuxi Biologics (2269 HK). The largest outflows were in CNOOC Ltd (883 HK) and Tencent (700 HK).

Bank Mandiri (BMRI IJ) – Upping the Ante on Returns

By Angus Mackintosh

Bank Mandiri (BMRI IJ) is executing well on its move to shift its focus toward higher-yielding assets in commercial, Micro, and SME segments and also high-quality corporate loans.
The company has seen the cost of funds continue to decline as it picks up new savings accounts through its Livin’ app, helping to improve NIMs and returns.
Bank Mandiri (BMRI IJ)‘s cost of credit continues to fall, with declining provisions also helping to improve profitability, and with ROEs hitting multi-year highs while valuations remain attractive.

Brazil Digital Banks – Nubank and Banco Inter Shares Have De-Rated, but Still Face Challenges

By Victor Galliano

Despite the compression in the Brazil digital banks’ multiples from the FinTech de-rating, big fundamental hurdles remain, especially for Nubank
Nubank is delivering on increased loan penetration and this should drive revenue growth; still, this also drives higher and front loaded provisioning charges along with capital absorption
Banco Inter is less challenged than Nubank on most metrics, and it is modestly profitable, but we believe it is too early to turn positive; we like Banco do Brasil

Before it’s here, it’s on Smartkarma

Jun 11

China: HKEX, China Vast Industrial Urban Development, Bilibili Inc, Agile Property Holdings, LONGi Green Energy Technology, Sino Ocean Land and more

By Smartkarma Daily Briefs | China, Daily Briefs

In today’s briefing:

Shanghai/Shenzhen Southbound Connect: Weekly Moves (9 June 2022)
China VAST’s Underwhelming Privatisation Bid from China Jinmao
Bilibili 1Q2022: Widening Losses and There Is Further Downside
Chinese Property Weekly – 10 June 2022 – Lucror Analytics
Chinese Property Weekly – 10 June 2022 – Lucror Analytics
Shanghai/Shenzhen Northbound Connect: Weekly Moves (9 June 2022)
Weekly Wrap – 10 Jun 2022
Weekly Wrap – 10 Jun 2022
Weekly Wrap – 10 Jun 2022

Shanghai/Shenzhen Southbound Connect: Weekly Moves (9 June 2022)

By Shifara Samsudeen, ACMA, CGMA

Inside is a recap of movements in the last week relating to the Shanghai and Shenzhen-Hong Kong Stock Connect facilities, broken down by company and industry.
Overall, net inflow was ~US$0.6bn, split (roughly) <US$0.1bn for Shanghai and US$0.5bn for Shenzhen.
The largest inflows were into Kuaishou Technology (1024 HK) and Wuxi Biologics (2269 HK). The largest outflows were in CNOOC Ltd (883 HK) and Tencent (700 HK).

China VAST’s Underwhelming Privatisation Bid from China Jinmao

By Arun George

China Vast Industrial Urban Development (6166 HK) announced a pre-conditional privatisation offer from China Jinmao Holdings (817 HK) at HK$2.40 per share, a 30.4% premium to the undisturbed price.
Key conditions include approval by at least 75% disinterested shareholders (<10% of disinterested shareholders rejection). Shareholders with blocking stakes will be supportive.
The headcount test (if still applicable) is a key challenge as minorities are likely to be unimpressed. We would be buyers up to HK$2.26 per share (implies 75% deal probability).

Bilibili 1Q2022: Widening Losses and There Is Further Downside

Bilibili reported 1Q2022 results yesterday. Revenue grew 29.6% YoY to RMB5.1bn (vs consensus RMB5.04bn) while operating losses as a % of revenue increased to 39.4% from 26.4% in 1Q2021.
Monthly Paying Users (MPUs) reached 27.2m vs 20.5m in 1Q2021, however, blended ARPU declined to RMB41.8 from RMB43.4 a year ago suggesting that user growth comes at lower pricing.
Bilibili’s ADS’ closed 15% lower at the end of yesterday’s trading as widening losses and softer guidance for 2Q2022 disappointed the market.

Chinese Property Weekly – 10 June 2022 – Lucror Analytics

The Chinese Property Weekly focuses on providing updates in the Chinese real-estate sector, including recent regulatory and company developments, top and bottom performers, rating actions, as well as a list of bond maturities in the next 30 days.

Chinese Property Weekly – 10 June 2022 – Lucror Analytics

Shanghai/Shenzhen Northbound Connect: Weekly Moves (9 June 2022)

Inside is a recap of movements in the last week relating to the Hong Kong Stock-Shanghai and Shenzhen Northbound Connect facilities, broken down by company and industry.
Overall, net inflow was ~US$6.5bn, split between Shanghai (+US$5.5bn) and Shenzhen (+US$1.0bn).
The largest inflows were into LONGi Green Energy Technology (601012 CH) and Kweichow Moutai (600519 CH). The largest outflows were in CATL (300750 CH) and Cosco Shipping Holdings (601919 CH).

Weekly Wrap – 10 Jun 2022

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:

and more…

Weekly Wrap – 10 Jun 2022

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:

and more…

Weekly Wrap – 10 Jun 2022

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:

and more…

Before it’s here, it’s on Smartkarma

Jun 11

Event-Driven: HKEX, China Vast Industrial Urban Development, Sk Discovery, Korea Electric Power, LONGi Green Energy Technology, Iljin Hysolus and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

Shanghai/Shenzhen Southbound Connect: Weekly Moves (9 June 2022)
China VAST’s Underwhelming Privatisation Bid from China Jinmao
Short-Covering Trend of KOSPI 200 Deletions by Month-End
NPS Plans to Increase Its Stake in KEPCO from 6.4% to Up to 10.0%
Shanghai/Shenzhen Northbound Connect: Weekly Moves (9 June 2022)
Shorting Trend Projections on KOSPI 200 Additions

Shanghai/Shenzhen Southbound Connect: Weekly Moves (9 June 2022)

Inside is a recap of movements in the last week relating to the Shanghai and Shenzhen-Hong Kong Stock Connect facilities, broken down by company and industry.
Overall, net inflow was ~US$0.6bn, split (roughly) <US$0.1bn for Shanghai and US$0.5bn for Shenzhen.
The largest inflows were into Kuaishou Technology (1024 HK) and Wuxi Biologics (2269 HK). The largest outflows were in CNOOC Ltd (883 HK) and Tencent (700 HK).

China VAST’s Underwhelming Privatisation Bid from China Jinmao

By Arun George

China Vast Industrial Urban Development (6166 HK) announced a pre-conditional privatisation offer from China Jinmao Holdings (817 HK) at HK$2.40 per share, a 30.4% premium to the undisturbed price.
Key conditions include approval by at least 75% disinterested shareholders (<10% of disinterested shareholders rejection). Shareholders with blocking stakes will be supportive.
The headcount test (if still applicable) is a key challenge as minorities are likely to be unimpressed. We would be buyers up to HK$2.26 per share (implies 75% deal probability).

Short-Covering Trend of KOSPI 200 Deletions by Month-End

By Sanghyun Park

As expected, most of the KOSPI 200 deletions, except for Bukwang Pharm, significantly outperformed the KOSPI index today.
Those that fit the pattern shown in the last rebalancing are CJ CGV and Bukwang. The problem, however, is that they have potential events triggering their price to fall.
So, I suggest paying attention to Yungjin Pharm and SK Discovery, which also have a sizable level of short interest and are expected to have stable short-coverings by end-June.

NPS Plans to Increase Its Stake in KEPCO from 6.4% to Up to 10.0%

By Douglas Kim

After the market close today, KEPCO announced that NPS plans to increase its ownership of the company from 6.43% to as high as 10% by 2025.
This announcement is likely to have a positive impact on KEPCO’s shares both in the near term as well as over the next three years.
If NPS has a greater stake in KEPCO, this could encourage the government to raise electricity prices since the government wants the investments made by the NPS to perform well.

Shanghai/Shenzhen Northbound Connect: Weekly Moves (9 June 2022)

Inside is a recap of movements in the last week relating to the Hong Kong Stock-Shanghai and Shenzhen Northbound Connect facilities, broken down by company and industry.
Overall, net inflow was ~US$6.5bn, split between Shanghai (+US$5.5bn) and Shenzhen (+US$1.0bn).
The largest inflows were into LONGi Green Energy Technology (601012 CH) and Kweichow Moutai (600519 CH). The largest outflows were in CATL (300750 CH) and Cosco Shipping Holdings (601919 CH).

Shorting Trend Projections on KOSPI 200 Additions

By Sanghyun Park

All of these additions experienced significant levels of short trading yesterday. In particular, those newly listed stocks saw harsher shorting attacks, similar to what we witnessed at the last rebalancing.
A certain level of short selling trend for newly listed stocks will likely work the same this time, and the applicable period is expected to be 3-4 trading days.
That is, we need to target the newly listed stocks again for this rebalancing: Iljin Hysolus (271940 KS), K Car (381970 KS), and SD Biosensor (137310 KS).

Before it’s here, it’s on Smartkarma

Jun 11

Consumer: RPSG Ventures Limited and more

By Smartkarma Daily Briefs | Consumer, Daily Briefs

In today’s briefing:

RPSG Ventures (RPSGV): FMCG Business Gaining Traction; IPL Media Rights Auction – A Key Monitorable

RPSG Ventures (RPSGV): FMCG Business Gaining Traction; IPL Media Rights Auction – A Key Monitorable

By Ankit Agrawal, CFA

The FMCG Business reported Q4FY22 revenues, in line with the recent annualized revenue run-rate of around INR 400cr.
The relatively new Naturali brand was advertised prominently at the IPL and its products are becoming increasingly visible at department stores.
A key monitorable for RPSGV’s sports business is the IPL Media Rights Auction that is scheduled to be held on Jun 12.

Before it’s here, it’s on Smartkarma

Jun 11

Indonesia: Bank Mandiri Persero, Sino Ocean Land and more

By Smartkarma Daily Briefs | Daily Briefs, Indonesia

In today’s briefing:

Bank Mandiri (BMRI IJ) – Upping the Ante on Returns
Weekly Wrap – 10 Jun 2022

Bank Mandiri (BMRI IJ) – Upping the Ante on Returns

By Angus Mackintosh

Bank Mandiri (BMRI IJ) is executing well on its move to shift its focus toward higher-yielding assets in commercial, Micro, and SME segments and also high-quality corporate loans.
The company has seen the cost of funds continue to decline as it picks up new savings accounts through its Livin’ app, helping to improve NIMs and returns.
Bank Mandiri (BMRI IJ)‘s cost of credit continues to fall, with declining provisions also helping to improve profitability, and with ROEs hitting multi-year highs while valuations remain attractive.

Weekly Wrap – 10 Jun 2022

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:

and more…

Before it’s here, it’s on Smartkarma

Jun 11

Industrials: Ashok Leyland, Tokyo Electron, Iljin Hysolus and more

By Smartkarma Daily Briefs | Daily Briefs, Industrials

In today’s briefing:

India Channel Insight #38 | Ashok Leyland, Tata Motors (MHCV)
Tokyo Electron (8035 JP): New Medium-Term Plan Vs. Reality
Shorting Trend Projections on KOSPI 200 Additions

India Channel Insight #38 | Ashok Leyland, Tata Motors (MHCV)

By Pranav Bhavsar

Infrastructure and E-commerce are core drivers of the MHCV recovery
The market for Retail fleet operators (1-5 trucks) has shrunk.
Ashok Leyland (AL IN) ‘s market share gain has been on the back of discounting and is unlikely to sustain.

Tokyo Electron (8035 JP): New Medium-Term Plan Vs. Reality

By Scott Foster

Tokyo Electron has announced a new Medium-term Plan that shows what the company could probably do if the next five years were as good as the last five years.
That seems unlikely. The plan ignores rising interest rates, the risk of recession, political risk, and the possibility of demand from South Korea, Taiwan and China maxing out.
It looks like FY Mar-23 guidance is intended to be conservative. That cannot be take for granted.

Shorting Trend Projections on KOSPI 200 Additions

By Sanghyun Park

All of these additions experienced significant levels of short trading yesterday. In particular, those newly listed stocks saw harsher shorting attacks, similar to what we witnessed at the last rebalancing.
A certain level of short selling trend for newly listed stocks will likely work the same this time, and the applicable period is expected to be 3-4 trading days.
That is, we need to target the newly listed stocks again for this rebalancing: Iljin Hysolus (271940 KS), K Car (381970 KS), and SD Biosensor (137310 KS).

Before it’s here, it’s on Smartkarma

Jun 11

Most Read: Orient Overseas International, ACM Research Shanghai Inc, Crown Resorts, HKEX, Tokyo Electron and more

By Smartkarma Daily Briefs | Daily Briefs, Most Read

In today’s briefing:

OOIL (316 HK): Peak Index Inclusion?
STAR50 Index Rebalance Preview (Sep): Change Is the Only Constant
Crown Resorts: Regulatory Approvals Falling Into Place
Shanghai/Shenzhen Southbound Connect: Weekly Moves (9 June 2022)
Tokyo Electron (8035 JP): New Medium-Term Plan Vs. Reality

OOIL (316 HK): Peak Index Inclusion?

By Brian Freitas

Over the last 3 months, Orient Overseas International (316 HK) has been added to the FTSE All-World Index, MSCI Standard Index and Hong Kong Hang Seng Index (HSI INDEX).
The stock has outperformed its Asia peers and now trades at a higher valuation. Shorts have been building positions over the last couple of months.
Cumulative excess volume on the stock has been increasing. While a lot of positioning has likely been unwound, there could be more unwinding over the next few weeks.

STAR50 Index Rebalance Preview (Sep): Change Is the Only Constant

By Brian Freitas

With only one change expected in September using a 12 month minimum listing history, we expect the index committee to continue using a 6 month minimum listing history.
That will see the maximum of 5 changes that are permitted at a single rebalance resulting in a one-way turnover just shy of 5%.
Over the last few rebalances, the adds have outperformed the deletes post the end of the review period. That’s expected given passive trackers need to buy/sell a lot of stock.

Crown Resorts: Regulatory Approvals Falling Into Place

Into the final straight. Victoria and NSW have signed off on Blackstone’s proposed acquisition of Crown Resorts (CWN AU).
Gaming regulatory approval from Western Australia remains outstanding, but this is done. Crown’s conduct in WA was no better – or worse – than it was in Victoria and NSW.
Trading super tight with potentially another month or so until payment.

Shanghai/Shenzhen Southbound Connect: Weekly Moves (9 June 2022)

Inside is a recap of movements in the last week relating to the Shanghai and Shenzhen-Hong Kong Stock Connect facilities, broken down by company and industry.
Overall, net inflow was ~US$0.6bn, split (roughly) <US$0.1bn for Shanghai and US$0.5bn for Shenzhen.
The largest inflows were into Kuaishou Technology (1024 HK) and Wuxi Biologics (2269 HK). The largest outflows were in CNOOC Ltd (883 HK) and Tencent (700 HK).

Tokyo Electron (8035 JP): New Medium-Term Plan Vs. Reality

By Scott Foster

Tokyo Electron has announced a new Medium-term Plan that shows what the company could probably do if the next five years were as good as the last five years.
That seems unlikely. The plan ignores rising interest rates, the risk of recession, political risk, and the possibility of demand from South Korea, Taiwan and China maxing out.
It looks like FY Mar-23 guidance is intended to be conservative. That cannot be take for granted.

Before it’s here, it’s on Smartkarma

Jun 11

Macro: CX Daily: China’s Never-Ending Coal Price Woes and more

By Smartkarma Daily Briefs | Daily Briefs, Macro

In today’s briefing:

CX Daily: China’s Never-Ending Coal Price Woes

CX Daily: China’s Never-Ending Coal Price Woes

By Caixin Global

Coal / In Depth: China’s never-ending coal price woes
Rains / Unending torrential rain leaves at least 24 dead across China. At least 24 people have died and six more are missing as torrential rain continues to batter parts of China, according to state media reports and official statements.
Inflows / Foreign capital roars back into China’s stock market

Before it’s here, it’s on Smartkarma

Jun 11

Health Care: Tactile Systems Technology I and more

By Smartkarma Daily Briefs | Daily Briefs, Healthcare

In today’s briefing:

Tactile Systems Technology (TCMD US): Subsiding COVID to Drive Mid-Teens Sales Growth in 2022

Tactile Systems Technology (TCMD US): Subsiding COVID to Drive Mid-Teens Sales Growth in 2022

By Tina Banerjee

Tactile Systems Technology I (TCMD US) offers pneumatic compression pump, which has total current addressable market opportunity of $10B+ in the U.S. The company’s annual run rate is ~$200M.
To penetrate the addressable market deeper, Tactile is aggressively expanding commercial team, which should lay the foundation for long-term sustainable revenue growth and margin expansion.
With the declining COVID-related headwinds, new product launch, and better commercial execution, Tactile should be well-positioned for accelerated growth trajectory.

Before it’s here, it’s on Smartkarma