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Smartkarma Daily Briefs

Nov 21
0

Daily Brief Indonesia: Selamat Sempurna and more

By | Daily Briefs, Indonesia

In today’s briefing:

  • Selamat Sempurna (SMSM IJ) – Filters and Radiators Leading the Recovery

Selamat Sempurna (SMSM IJ) – Filters and Radiators Leading the Recovery

By Angus Mackintosh

  • Selamat Sempurna (SMSM IJ) remains one of the best quality Indonesian industrial companies, as the leading auto and heavy equipment filter producers for both OEM and the aftermarket.
  • The company booked a strong set of 9M2022 results, with sales up +21% YoY and net profit increasing +30% YoY, driven by both domestic and export markets.
  • Selamat Sempurna (SMSM IJ) maintains it FY2022 target for 15% sales and profits growth for FY2022, which looks conservative after the performance at 9M stage despite potential global headwinds.

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Nov 21
0

Daily Brief Singapore: Golden Agri Resources, Halcyon Agri, Far East Hospitality Trust and more

By | Daily Briefs, Singapore

In today’s briefing:

  • FTSE All-World/​​​All-Cap Index Rebalance: Watch Golden Agri-Resources & Delhivery
  • Merger Arb Mondays (21 Nov) – Halcyon, Lifestyle, OZ Minerals, Perpetual/Pendal, Nearmap, Nitro
  • REIT Watch – Industrial S-Reits see resilience despite macro challenges

FTSE All-World/​​​All-Cap Index Rebalance: Watch Golden Agri-Resources & Delhivery

By Brian Freitas

Merger Arb Mondays (21 Nov) – Halcyon, Lifestyle, OZ Minerals, Perpetual/Pendal, Nearmap, Nitro

By Arun George

REIT Watch – Industrial S-Reits see resilience despite macro challenges

By Geoff Howie

  • REIT Watch – Hospitality S-Reits ride on pent-up travel demand and the return of events in Q3 2022 All hospitality trusts with Singapore assets observed significant improvements in occupancy and RevPAR (revenue per available room) in the last quarter, driven by the return of large-scale events and the Mice (meetings, incentives, conventions and exhibitions) industry, alongside pent-up demand for overseas travels.
  • Far East Hospitality Trust recorded that its Q3 2022 gross revenue increased 2.0 per cent yoy, led by growth from the hotel segment which increased 4.7 per cent.
  • Income available for distribution grew 12.0 per cent yoy from higher NPI and interest income.

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Nov 21
0

Daily Brief Australia: PEXA Group and more

By | Australia, Daily Briefs

In today’s briefing:

  • Link Admin’s In-Specie Distribution of PEXA: Active Selling Followed by Passive Buying

Link Admin’s In-Specie Distribution of PEXA: Active Selling Followed by Passive Buying

By Brian Freitas

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Nov 21
0

Daily Brief South Korea: Hyundai Motor and more

By | Daily Briefs, South Korea

In today’s briefing:

  • Lowering Tick Sizes for KOSPI & KOSDAQ Starting Next January

Lowering Tick Sizes for KOSPI & KOSDAQ Starting Next January

By Sanghyun Park

  • KRX will lower the tick sizes for KOSPI and KOSDAQ starting next January to reduce actual transaction costs and increase market liquidity by attracting more high-frequency traders.
  • KRX’s acceptance of the market’s long-standing demand at this point can be seen as primarily driven by the purpose of resolving the problem of reduced market liquidity.
  • We need to design a setup that takes a tighter holding period of event and flow trading in the Korean local market from next year.

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Nov 21
0

Daily Brief United States: S&P 500, Bitcoin and more

By | Daily Briefs, United States

In today’s briefing:

  • SPX 4,100 Top Build Ahead of 3,300
  • The 2022 Crypto Debt Crisis

SPX 4,100 Top Build Ahead of 3,300

By Thomas Schroeder

  • SPX has another tactical leg up within our Q4 bull cycle toward 4,100-200 where a top is expected to form.
  • Lead warning signals are emerging in the RTY relative performance and well-defined rising wedge. NDX trading new key lows is a negative for growth.
  • SPX 4,100 wedge sell zone stands out for a final down leg to 3,300/200, that sets the stage for a macro low a new bull cycle.

The 2022 Crypto Debt Crisis

By Etherbridge

  • Over the past week and a half, we witnessed the unravelling of the $32 billion empire that was FTX and the fall of its “benevolent” leader Sam Bankman-Fried, otherwise known as SBF.
  • This story of overleveraging and outright fraud has formed a part of the bigger crypto debt crisis of 2022.
  • This article will explore how this debt crisis has unfolded and how all parties were closely interlinked. 

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Nov 21
0

Daily Brief China: Haier Smart Home Co Ltd, Semiconductor Manufacturing International Corp (SMIC), China Construction Bank H, Weimob Inc., Bilibili, Galaxy Entertainment Group, Zhangzhou Pientzehuang Pharmaceutical Co., Ltd. and more

By | China, Daily Briefs

In today’s briefing:

  • Hang Seng Index Dec22 Rebal – 3 IN, None Out (The March to 80 Continues)
  • Hang Seng TECH Index Rebalance: Float & Capping Changes
  • HSCEI Dec 2022 Rebalance – 4 IN, 4 OUT, 3% One-Way Flow
  • Weimob (2013 HK): Strategic Patience Will Be Rewarded (Part 2)
  • Hang Seng Tech Rebalance Dec 2022 – No Name Changes, Decent Flow
  • Galaxy Entertainment Group: Its 4.5% of Wynn Shares Key if the Stock Is in Play
  • Zhangzhou Pientzehuang Pharmaceutical (600436.CH) – Disappointing Performance Is Just the Beginning

Hang Seng Index Dec22 Rebal – 3 IN, None Out (The March to 80 Continues)

By Travis Lundy

Hang Seng TECH Index Rebalance: Float & Capping Changes

By Brian Freitas

  • As expected, there are no adds or deletes for the Hang Seng Tech Index (HSTECH INDEX) in December. However, there are plenty of capping and float changes to drive flows.
  • The December rebalance is expected to have a one-way turnover of 2.3% resulting in a one-way trade of HK$1.9bn.
  • Short interest is greater than 5% of float on a few stocks and a continued recovering in markets could lead to a squeeze higher.

HSCEI Dec 2022 Rebalance – 4 IN, 4 OUT, 3% One-Way Flow

By Travis Lundy

Weimob (2013 HK): Strategic Patience Will Be Rewarded (Part 2)

By Eric Chen

  • Weimob has emerged from the pandemic stronger and leaner, further consolidating its leadership in China’s e-commerce SaaS market. 
  • Drawing insights into the supply side (merchants/brands) on  Alibaba platform, our bottom-up analysis suggests that Weimob potentially has a US$600mn revenue opportunity by 2025.
  • We value Weimob at US$3bn assigning 5xPS on its US$600mn revenue by 2025,  implying 25% CAGR over 3-year period. Patience needed to navigate high-inflation environment which pressures growth assets. 

Hang Seng Tech Rebalance Dec 2022 – No Name Changes, Decent Flow

By Travis Lundy

  • The Hang Seng Tech Index Review was announced on Friday after the close. There are no name changes but there is decent flow. 3% one-way turnover.
  • There are five capping changes and one very large share count change making things interesting.
  • All told, this is less impactful than it was last time, and less impactful than the other index rebalances announced. 

Galaxy Entertainment Group: Its 4.5% of Wynn Shares Key if the Stock Is in Play

By Howard J Klein

  • In 2018, shortly after the departure of Wynn founder Steve Wynn, Galaxy bought 4.9% of his shares atUS$175. The shares have been under water. But a new player has entered.
  • Gaming, restaurant and sports entrepreneur Tillman Fertitta has just bought 6.1% of Wynn shares setting up a possible play on the shares, or a total takeover move.
  • There are three scenarios that could play bullish for Galaxy if Wynn is in play. All auger well for movement on the stock.

Zhangzhou Pientzehuang Pharmaceutical (600436.CH) – Disappointing Performance Is Just the Beginning

By Xinyao (Criss) Wang

  • Zhangzhou Pientzehuang Pharmaceutical Co., Ltd. (600436 CH)’s 22Q3 performance was disappointing because its strategy of “stabilizing” performance growth by raising prices has been ineffective.
  • Endogenous growth problem would finally be reflected in the decline of company’s valuation. We recommend to think about long-term logic from a broader perspective,not simply tracking performance of individual companies.
  • Pien Tze Huang’s valuation still has a lot of downward space. When the bubble bursts or its valuation is lower than Kweichow Moutai, it’s time to go long again.

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Nov 21
0

Daily Brief Japan: Sapporo Holdings, Alfresa Holdings and more

By | Daily Briefs, Japan

In today’s briefing:

  • Sapporo Holdings: Activist Investor, 3D Investment Partners Is Just A Few Steps From Turning Hostile
  • Alfresa Holdings (2784 JP): H1FY23 Review- Better-Than-Expected Performance; Outlook Is Positive

Sapporo Holdings: Activist Investor, 3D Investment Partners Is Just A Few Steps From Turning Hostile

By Oshadhi Kumarasiri

  • Following a couple of investor-activism campaigns against Toshiba Corp (6502 JP) and Fuji Soft Inc (9749 JP), Singapore-based Japan-focused activist investor, 3D-Investment-Partners seems to be turning its attention towards Sapporo.
  • Earlier this month, 3D Investment Partners requested Sapporo’s outside directors to postpone the announcement of the new Medium Term Plan until they hear out opinions and new ideas from shareholders.
  • We believe that there’s a chance that 3D Investment Partners could turn hostile as Sapporo Holdings (2501 JP) seems to be completely ignoring the activist investor’s requests and proposals.

Alfresa Holdings (2784 JP): H1FY23 Review- Better-Than-Expected Performance; Outlook Is Positive

By Tina Banerjee

  • Alfresa Holdings (2784 JP) reported better-than-expected H1FY23 results, with sales growth of 3% to ¥1,332 billion, 2% ahead of guidance of ¥1,304 billion, mainly driven by pharmaceutical wholesaling business.
  • With a revenue growth of 4.3% y/y, pharmaceutical wholesaling business outpaced the broad market growth of 2.7% and improved its market share to 23.3% at the end of H1FY23.
  • The company has announced an interim dividend of ¥28 per share. Despite reporting encouraging H1FY23 performance, Alfresa has reiterated its FY23 guidance, implying accelerated growth in H2FY23.

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Nov 21
0

Most Read: Zhongsheng Group, Haier Smart Home Co Ltd, Golden Agri Resources, Tata Motors Ltd, Semiconductor Manufacturing International Corp (SMIC), China Construction Bank H, Meituan, Monadelphous and more

By | Daily Briefs, Most Read

In today’s briefing:

  • HSI Index Rebalance: Baby Steps; Double Inclusion for Haier Smart Home
  • HSCEI Index Rebalance: Four Sets of Changes; And Some Close Calls
  • Hang Seng Index Dec22 Rebal – 3 IN, None Out (The March to 80 Continues)
  • FTSE All-World/​​​All-Cap Index Rebalance: Watch Golden Agri-Resources & Delhivery
  • SENSEX Dec 22 Index Rebalance: Tata Motors (TTMT) To Replace Dr Reddy (DRRD)
  • Hang Seng TECH Index Rebalance: Float & Capping Changes
  • HSCEI Dec 2022 Rebalance – 4 IN, 4 OUT, 3% One-Way Flow
  • Index Rebalance & ETF Flow Recap: HSCI, S&P/ASX, HSI, HSCEI, KOSPI2, KOSDAQ150, Wharf, Meituan
  • ECM Weekly (20th Nov 2022) – I-Tail, Growatt, Lygend, SinoHytech, Meituan/Tencent, Olympus, Paytm
  • S&P/​​​​​​​​ASX Quiddity Final Expectations Dec 22: Mostly Mining Companies, Avoid Short Buildup!

HSI Index Rebalance: Baby Steps; Double Inclusion for Haier Smart Home

By Brian Freitas

HSCEI Index Rebalance: Four Sets of Changes; And Some Close Calls

By Brian Freitas

  • There are 4 adds and 4 deletes for the Hang Seng China Enterprises Index (HSCEI INDEX) at the December rebalance. The only surprises are some non-adds and non-deletes.
  • Using prices from the close on 18 November, estimated one-way turnover is 4.64% and will result in a one-way trade of HK$2,612m at the close on 2 December.
  • Short interest is larger on the deletes than the adds. However, at 17 days of ADV to cover and 11.7% of float, short interest on Zhongsheng Group is huge.

Hang Seng Index Dec22 Rebal – 3 IN, None Out (The March to 80 Continues)

By Travis Lundy

FTSE All-World/​​​All-Cap Index Rebalance: Watch Golden Agri-Resources & Delhivery

By Brian Freitas

SENSEX Dec 22 Index Rebalance: Tata Motors (TTMT) To Replace Dr Reddy (DRRD)

By Brian Freitas

Hang Seng TECH Index Rebalance: Float & Capping Changes

By Brian Freitas

  • As expected, there are no adds or deletes for the Hang Seng Tech Index (HSTECH INDEX) in December. However, there are plenty of capping and float changes to drive flows.
  • The December rebalance is expected to have a one-way turnover of 2.3% resulting in a one-way trade of HK$1.9bn.
  • Short interest is greater than 5% of float on a few stocks and a continued recovering in markets could lead to a squeeze higher.

HSCEI Dec 2022 Rebalance – 4 IN, 4 OUT, 3% One-Way Flow

By Travis Lundy

Index Rebalance & ETF Flow Recap: HSCI, S&P/ASX, HSI, HSCEI, KOSPI2, KOSDAQ150, Wharf, Meituan

By Brian Freitas

  • Plenty of index change announcements in the last week – Kospi 200 Index, KOSDAQ 150 Index, Hang Seng Index, HSCEI, HSTECH, S&P BSE SENSEX Index and FTSE AW/AC Index.
  • There are a bunch of indices that have the end of their review periods in the coming week while announcements for China indices are expected post market close on Friday.
  • There were outflows from ETFs for most Asian markets over the week with China and Hong Kong ETFs taking the biggest hits.

ECM Weekly (20th Nov 2022) – I-Tail, Growatt, Lygend, SinoHytech, Meituan/Tencent, Olympus, Paytm

By Sumeet Singh

  • Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
  • On the IPO front,  Indian IPOs delivered some decent performance while HK IPOs are likely to pick up as well.
  • There were a number of placement and blocks this week, after the expiry of lockups in a few Indian names.

S&P/​​​​​​​​ASX Quiddity Final Expectations Dec 22: Mostly Mining Companies, Avoid Short Buildup!

By Janaghan Jeyakumar, CFA

  • In this insight, we take a look at the potential index changes for S&P ASX 200, 100, 50, and 20 in the run up to the December 2022 Rebalance.
  • The 6-month reference period for the December 2022 Rebalance is now complete.
  • I do not see any changes for ASX 20 or ASX 100. I see one ADD/DEL for ASX 50 and three ADDs/DELs for ASX 200.

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Nov 21
0

Daily Brief Financials: China Construction Bank H, PEXA Group, S&P 500, Bitcoin and more

By | Daily Briefs, Financials

In today’s briefing:

  • HSCEI Dec 2022 Rebalance – 4 IN, 4 OUT, 3% One-Way Flow
  • Link Admin’s In-Specie Distribution of PEXA: Active Selling Followed by Passive Buying
  • SPX 4,100 Top Build Ahead of 3,300
  • The 2022 Crypto Debt Crisis

HSCEI Dec 2022 Rebalance – 4 IN, 4 OUT, 3% One-Way Flow

By Travis Lundy

Link Admin’s In-Specie Distribution of PEXA: Active Selling Followed by Passive Buying

By Brian Freitas

SPX 4,100 Top Build Ahead of 3,300

By Thomas Schroeder

  • SPX has another tactical leg up within our Q4 bull cycle toward 4,100-200 where a top is expected to form.
  • Lead warning signals are emerging in the RTY relative performance and well-defined rising wedge. NDX trading new key lows is a negative for growth.
  • SPX 4,100 wedge sell zone stands out for a final down leg to 3,300/200, that sets the stage for a macro low a new bull cycle.

The 2022 Crypto Debt Crisis

By Etherbridge

  • Over the past week and a half, we witnessed the unravelling of the $32 billion empire that was FTX and the fall of its “benevolent” leader Sam Bankman-Fried, otherwise known as SBF.
  • This story of overleveraging and outright fraud has formed a part of the bigger crypto debt crisis of 2022.
  • This article will explore how this debt crisis has unfolded and how all parties were closely interlinked. 

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Nov 21
0

Daily Brief Industrials: Halcyon Agri, Selamat Sempurna, Somfy SA and more

By | Daily Briefs, Industrials

In today’s briefing:

  • Merger Arb Mondays (21 Nov) – Halcyon, Lifestyle, OZ Minerals, Perpetual/Pendal, Nearmap, Nitro
  • Selamat Sempurna (SMSM IJ) – Filters and Radiators Leading the Recovery
  • Despature Family/Somfy: Lowball Simplified Takeout, Timetable

Merger Arb Mondays (21 Nov) – Halcyon, Lifestyle, OZ Minerals, Perpetual/Pendal, Nearmap, Nitro

By Arun George

Selamat Sempurna (SMSM IJ) – Filters and Radiators Leading the Recovery

By Angus Mackintosh

  • Selamat Sempurna (SMSM IJ) remains one of the best quality Indonesian industrial companies, as the leading auto and heavy equipment filter producers for both OEM and the aftermarket.
  • The company booked a strong set of 9M2022 results, with sales up +21% YoY and net profit increasing +30% YoY, driven by both domestic and export markets.
  • Selamat Sempurna (SMSM IJ) maintains it FY2022 target for 15% sales and profits growth for FY2022, which looks conservative after the performance at 9M stage despite potential global headwinds.

Despature Family/Somfy: Lowball Simplified Takeout, Timetable

By Jesus Rodriguez Aguilar

  • Majority shareholders Despatures (73.9%) plan to use the abundant cash holdings of Somfy to finance a simplified cash offer at €143/share (16.8x EV/23e EBIT, 21.1x P/23e E, 20.6% premium).
  • In case of squeeze-out, Somfy intends to distribute afterwards an extraordinary dividend up to €620m (source: draft memo). The market believes the offer is low (gross spread is +0.98%).
  • I believe there are grounds for an offer sweetening (base-case valuation throws €150.98/share) and the risk-reward seems favorable considering a very motivated (and opportunistic) buyer. Long.

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