Smartkarma Daily Briefs

There are 51 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal
Three new deals were discussed on Smartkarma: Beach Energy’s tilt for Warrego (WGO AU), Sumitomo’s offer for Sumitomo Precision (6355 JP), and Hainan Rubber’s offer for Halcyon (HACL SP).
Key updates took place for: Perpetual Ltd (PPT AU) / Pendal Group (PDL AU), Nitro Software Ltd (NTO AU), and OZ Minerals Ltd (OZL AU).

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 20

Daily Brief TMT/Internet: Meituan, Taiwan Semiconductor (TSMC) – ADR, Travelsky Technology Ltd H, NVIDIA Corp, Hong Kong Hang Seng Index, Cisco Systems and more

By Smartkarma Daily Briefs | Daily Briefs, TMT/Internet

In today’s briefing:

Index Rebalance & ETF Flow Recap: HSCI, S&P/ASX, HSI, HSCEI, KOSPI2, KOSDAQ150, Wharf, Meituan
Intel Vs. TSMC Monitor: TSMC Soars on Buffett Investment, Why INTC Could Now Revert
Last Week in Event SPACE: Tencent/Meituan, Halcyon Agri, Swire Pac, Perpetual/Pendal, OZ Minerals
ECM Weekly (20th Nov 2022) – I-Tail, Growatt, Lygend, SinoHytech, Meituan/Tencent, Olympus, Paytm
Travelsky (696): Beneficiary from Potential Reopening in China
NVIDIA Corp: New Product Launches & Other Drivers
EQD | Volatility Update: Weekly Review of Vol Changes and Best Trades
Cisco Systems Inc: Major Drivers

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

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.

Intel Vs. TSMC Monitor: TSMC Soars on Buffett Investment, Why INTC Could Now Revert

By Vincent Fernando, CFA

TSMC has outperformed INTC by 23% in just two weeks, which is an extreme divergence in a short period of time by historical standards.
Foreseeable company-specific events or news flow over the next 30 days appears limited.
Valuation remains supportive for INTC and we believe it could recover part of its recent underperformance in the next month.

Last Week in Event SPACE: Tencent/Meituan, Halcyon Agri, Swire Pac, Perpetual/Pendal, OZ Minerals

The in-specie distribution is basically a forward block sale of Meituan (3690 HK). You know it’s coming. You don’t know how large it is. It is not unlike a lockup situation.
China Hainan Rubber Industry (601118 CH) will start with 36% in Halcyon Agri (HACL SP). Founders and friends have ~10%. Getting to 50%+ will be easy.
The Swire Pacific (B) / Swire Pacific (A) ratio is near a 19-year low. The last time it dipped to 6% under its 3mo average, it bounced back in 4 weeks.

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.

Travelsky (696): Beneficiary from Potential Reopening in China

By Henry Soediarko

Travelsky Technology Ltd H (696 HK) is a system provider for airports in China that benefit from the reopening plan.
The company is not sensitive to the oil price and it has low debt which makes it attractive compared to the airlines.
The stock is trading at a 40% PBR discount to Shanghai International Airport. Historically, the company is trading at a 50% discount to its 5-year high on PBR.

NVIDIA Corp: New Product Launches & Other Drivers

NVIDIA Corp delivered a mixed performance as the company’s revenues exceeded the analyst consensus estimate.
However, its earnings were below par given the persistent supply chain interruptions, increased export bans, and macroeconomic challenges.
Leading U.S. cloud providers and a growing number of consumer Internet companies were the main drivers of year-over-year increases for workloads like big language models, recommendation systems, and generative AI.

EQD | Volatility Update: Weekly Review of Vol Changes and Best Trades

By Simon Harris

Weekly summary of vol changes and moves across Global Markets
Analysing ATM volatility and skew changes over the last 5 days
We suggest a few trades to take advantage of the implied vol surfaces

Cisco Systems Inc: Major Drivers

Cisco had a good start to fiscal 2023 and managed to deliver an all-around beat.
The management continued their shift to greater software and subscription-based recurring revenue, even as they proactively manage through a developing and complicated market environment.
Web-scale orders increased by double digits or more on a trailing 12-month basis for the ninth consecutive quarter.

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Nov 20

Daily Brief ECM: ECM Weekly (20th Nov 2022) – I-Tail and more

By Smartkarma Daily Briefs | Daily Briefs, ECM

In today’s briefing:

ECM Weekly (20th Nov 2022) – I-Tail, Growatt, Lygend, SinoHytech, Meituan/Tencent, Olympus, Paytm
NVIDIA Corp: New Product Launches & Other Drivers

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.

NVIDIA Corp: New Product Launches & Other Drivers

NVIDIA Corp delivered a mixed performance as the company’s revenues exceeded the analyst consensus estimate.
However, its earnings were below par given the persistent supply chain interruptions, increased export bans, and macroeconomic challenges.
Leading U.S. cloud providers and a growing number of consumer Internet companies were the main drivers of year-over-year increases for workloads like big language models, recommendation systems, and generative AI.

💡 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
✓ Events & Webinars

Nov 20

Daily Brief Consumer: Haier Smart Home Co Ltd, Zhongsheng Group, Oriental Watch, LG Household & Health Care, Tata Motors Ltd, Home Depot Inc, Target Corp, Lowe’s Companies Inc, Tokyo Stock Exchange Tokyo Price Index Topix and more

By Smartkarma Daily Briefs | Consumer, Daily Briefs

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
Oriental Watch Mgmt Call: Big Dividend Yet Again, 50% of Mkt Cap in Cash with >15% Yield Post Rally
Light at the End of the Dark Tunnel for Korean Cosmetics?
SENSEX Dec 22 Index Rebalance: Tata Motors (TTMT) To Replace Dr Reddy (DRRD)
Home Depot Inc: Managing Labor Shortages & Other Developments
Target Corporation: Partnership With Apple & Other Drivers
Lowe’s Companies: Divestment Of Canadian Retail Operations & Other Drivers
Raising % of Female Board Directors Requires Solving a Variety of Challenges in Reality

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

The inclusion of Tingyi Holding (322 HK), China Resources Mixc Lifestyle Services (1209 HK) and Haier Smart Home Co Ltd (6690 HK) gets us to 76 index constituents.
Changes to the stocks, number of shares, float and capping result in an estimated one-way turnover of 2.01% and will result in a one-way trade of HK$3,845m.
Shorts on Haier Smart Home Co Ltd (6690 HK) and Tingyi Holding (322 HK) are around 5% of float and covering could take the stocks higher.

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

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.

Oriental Watch Mgmt Call: Big Dividend Yet Again, 50% of Mkt Cap in Cash with >15% Yield Post Rally

By Sameer Taneja

Oriental Watch (398 HK) paid a 31-cent dividend in its H1FY23 result on the 16th, equating to an annualized dividend yield of 15% on the current share price.
The outlook for the rest of the year is much brighter, given the recovery in China and the inability of the Chinese to travel. October numbers were strong.
The stock trades at a 6.7x PE, with more than 50% of the market capitalization in cash. In slightly better market conditions, this could be a 6 HKD stock.

Light at the End of the Dark Tunnel for Korean Cosmetics?

By Douglas Kim

We believe that there is finally some light showing at the end of the dark tunnel for the two leading Korean cosmetics companies LG H&H and Amorepacific Corp.
These two stocks have underperformed the market in the past year but have started to outperform the market in the past three weeks.
There are credible signs that indoor mask wearing in Korea will be eliminated in Korea on/near March 2023 and that the inbound visitors to Korea will continue to increase significantly.

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

As forecast, Tata Motors Ltd (TTMT IN) will be added to the S&P BSE SENSEX Index (SENSEX INDEX) in December to replace Dr. Reddy’s Laboratories (DRRD IN).
We estimate passive trackers will need to buy 2.3x ADV (7.2x delivery volume) on Tata Motors Ltd (TTMT) while selling 5x ADV (10.5x delivery volume) on Dr. Reddy’s Laboratories (DRRD).
The HDFC Limited (HDFC IN) / HDFC Bank (HDFCB IN) merger should see Adani Enterprises (ADE IN) added to the S&P BSE SENSEX Index (SENSEX INDEX) prior to the June rebalance.

Home Depot Inc: Managing Labor Shortages & Other Developments

Home Depot delivered another good result and surpassed Wall Street expectations in terms of revenues as well as earnings.
The company continued to observe high demand for home renovation projects throughout the third quarter.
Sales growth for both Pro and DIY was good, with Pro surpassing DIY.

Target Corporation: Partnership With Apple & Other Drivers

Target’s third quarter results were a mixed bag as the company’s revenues surpassed Wall Street expectations but it missed out on meeting earnings expectations.
Their top-line continues to profit from increases in guest visitation and unit share gains across all of their main categories.
While their performance in the third quarter compared favorably with the previous one, the period’s tendencies were very different.

Lowe’s Companies: Divestment Of Canadian Retail Operations & Other Drivers

Lowe’s delivered an impressive set of results this quarter and managed to surpass Wall Street expectations in terms of revenues as well as earnings.
The company’s Pro business maintained its momentum, resulting from the success of its Pro efforts and the tenacity of the demand for home renovation.
Their ongoing focus on productivity and solid sales growth contributed to improved operating performance which ensured the earnings beat.

Raising % of Female Board Directors Requires Solving a Variety of Challenges in Reality

By Aki Matsumoto

72.9% of companies in prime market complied with the principles of Corporate Governance Code, which defines the concept of ensuring diversity, but no specific targets were set in their disclosures.
If % female directors were raised to 30%, they should be recruited from within the company to executive directors, but very few companies have % female managers exceeding 30%.
Gender discrimination in hiring, gender disparity in access to higher education, issues of leaving/returning to work due to childbirth and child rearing, and gender discrimination in workplace must be resolved.

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Nov 20

Daily Brief Financials: Fairfax India Holdings, Ganglong China Property Group, Bitcoin and more

By Smartkarma Daily Briefs | Daily Briefs, Financials

In today’s briefing:

Fairfax India Holdings: Major Value Unlock Via BIAL IPO
Hong Kong CEO & Director Dealings (18 Nov): Cross Harbour, Grand Ming, Ganglong, Pharmaron, JL Mag
An Arbitrage Opportunity? Evaluating the GBTC Convergence Trade

Fairfax India Holdings: Major Value Unlock Via BIAL IPO

Fairfax India Holdings (FIH/U CN), a holdco with investment activities exclusively in India, is edging closer to IPOing 49%-held Bangalore International Airport (BIAL).
Reportedly FIH is seeking a value upward of C$3.7bn for BIAL, a 45% premium over the current fair value holding.
Currently trading at a P/B of 0.6x compared to its five-year average of 0.8x, and the two-year average pre-Covid of 1.06x.

Hong Kong CEO & Director Dealings (18 Nov): Cross Harbour, Grand Ming, Ganglong, Pharmaron, JL Mag

The data in this insight is collated from the “shareholding disclosure” link on the HKEx website.
Often there is a corresponding HKEx announcement on the increase – or decrease – in the shareholding by directors. However, such disclosures are by no means an absolute.
These insights may flag those companies where shares have been pledged. Stocks mentioned include Cross Harbour (32 HK), Grand Ming (1271 HK), and Ganglong China Property (6968 HK)

An Arbitrage Opportunity? Evaluating the GBTC Convergence Trade

By Rose Choy

Recent concerns on Genesis’ solvency arose after the broker/dealer halted redemptions on its lending unit and was reportedly looking to raise $1 billion of loans from investors.
Contagion fears have extended to Genesis’ parent company, DCG, and its wholly owned Grayscale subsidiary, which has a steady fee generating business via its Bitcoin and ETH trust products.
We analyze the potential arbitrage opportunity for the controversial GBTC convergence trade with its 42.7% discount to NAV.

💡 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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✓ Custom Watchlists
✓ Company Data and News
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Nov 20

Daily Brief Event-Driven: HSI Index Rebalance: Baby Steps; Double Inclusion for Haier Smart Home and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

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
Fairfax India Holdings: Major Value Unlock Via BIAL IPO
Index Rebalance & ETF Flow Recap: HSCI, S&P/ASX, HSI, HSCEI, KOSPI2, KOSDAQ150, Wharf, Meituan
Weekly Deals Digest (20 Nov) – OZ Minerals, Pendal, Nearmap, Halcyon, Yashili, I-Tail, Lygend
Lotte Chemical Offering Terms & Trading Angle Targeting K200 Inflow on Ex-Date
SENSEX Dec 22 Index Rebalance: Tata Motors (TTMT) To Replace Dr Reddy (DRRD)
Last Week in Event SPACE: Tencent/Meituan, Halcyon Agri, Swire Pac, Perpetual/Pendal, OZ Minerals
(Mostly) Asia-Pac Weekly Risk Arb Wrap: Warrego, Sumitomo Precision, Halcyon Agri, Nitro Software
Hong Kong CEO & Director Dealings (18 Nov): Cross Harbour, Grand Ming, Ganglong, Pharmaron, JL Mag

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

The inclusion of Tingyi Holding (322 HK), China Resources Mixc Lifestyle Services (1209 HK) and Haier Smart Home Co Ltd (6690 HK) gets us to 76 index constituents.
Changes to the stocks, number of shares, float and capping result in an estimated one-way turnover of 2.01% and will result in a one-way trade of HK$3,845m.
Shorts on Haier Smart Home Co Ltd (6690 HK) and Tingyi Holding (322 HK) are around 5% of float and covering could take the stocks higher.

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

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.

Fairfax India Holdings: Major Value Unlock Via BIAL IPO

Fairfax India Holdings (FIH/U CN), a holdco with investment activities exclusively in India, is edging closer to IPOing 49%-held Bangalore International Airport (BIAL).
Reportedly FIH is seeking a value upward of C$3.7bn for BIAL, a 45% premium over the current fair value holding.
Currently trading at a P/B of 0.6x compared to its five-year average of 0.8x, and the two-year average pre-Covid of 1.06x.

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

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.

Weekly Deals Digest (20 Nov) – OZ Minerals, Pendal, Nearmap, Halcyon, Yashili, I-Tail, Lygend

By Arun George

A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
ECM developments – I-Tail (ITC TB) launches an up to US$593 million SET IPO, Lygend Resources & Technology (LR HK) set to launch an HKEx IPO to raise US$700-800 million.
Event-Driven developments – OZ Minerals Ltd (OZL AU), Perpetual Ltd (PPT AU)/Pendal Group (PDL AU), Nearmap Ltd (NEA AU), Halcyon Agri (HACL SP), Yashili International Holdings (1230 HK).

Lotte Chemical Offering Terms & Trading Angle Targeting K200 Inflow on Ex-Date

By Sanghyun Park

Lotte Chemical offers 8.5M new shares, which is ₩1.1T based on the provisional price of ₩130,000. This is a capital increase rate of 24.8%.
This event has already been leaked in advance from early last week, so it isn’t easy to expect a significant return from the short-selling approach immediately after the announcement.
Instead, we should pay attention to the KOSPI 200 passive inflow that occurs the day before the ex-date. It is estimated to be approximately 0.8x ADTV.

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

As forecast, Tata Motors Ltd (TTMT IN) will be added to the S&P BSE SENSEX Index (SENSEX INDEX) in December to replace Dr. Reddy’s Laboratories (DRRD IN).
We estimate passive trackers will need to buy 2.3x ADV (7.2x delivery volume) on Tata Motors Ltd (TTMT) while selling 5x ADV (10.5x delivery volume) on Dr. Reddy’s Laboratories (DRRD).
The HDFC Limited (HDFC IN) / HDFC Bank (HDFCB IN) merger should see Adani Enterprises (ADE IN) added to the S&P BSE SENSEX Index (SENSEX INDEX) prior to the June rebalance.

Last Week in Event SPACE: Tencent/Meituan, Halcyon Agri, Swire Pac, Perpetual/Pendal, OZ Minerals

The in-specie distribution is basically a forward block sale of Meituan (3690 HK). You know it’s coming. You don’t know how large it is. It is not unlike a lockup situation.
China Hainan Rubber Industry (601118 CH) will start with 36% in Halcyon Agri (HACL SP). Founders and friends have ~10%. Getting to 50%+ will be easy.
The Swire Pacific (B) / Swire Pacific (A) ratio is near a 19-year low. The last time it dipped to 6% under its 3mo average, it bounced back in 4 weeks.

(Mostly) Asia-Pac Weekly Risk Arb Wrap: Warrego, Sumitomo Precision, Halcyon Agri, Nitro Software

There are 51 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal
Three new deals were discussed on Smartkarma: Beach Energy’s tilt for Warrego (WGO AU), Sumitomo’s offer for Sumitomo Precision (6355 JP), and Hainan Rubber’s offer for Halcyon (HACL SP).
Key updates took place for: Perpetual Ltd (PPT AU) / Pendal Group (PDL AU), Nitro Software Ltd (NTO AU), and OZ Minerals Ltd (OZL AU).

Hong Kong CEO & Director Dealings (18 Nov): Cross Harbour, Grand Ming, Ganglong, Pharmaron, JL Mag

The data in this insight is collated from the “shareholding disclosure” link on the HKEx website.
Often there is a corresponding HKEx announcement on the increase – or decrease – in the shareholding by directors. However, such disclosures are by no means an absolute.
These insights may flag those companies where shares have been pledged. Stocks mentioned include Cross Harbour (32 HK), Grand Ming (1271 HK), and Ganglong China Property (6968 HK)

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

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

✓ Unlimited Research Summaries
✓ Personalised Alerts
✓ Custom Watchlists
✓ Company Data and News
✓ Events & Webinars

Nov 20

Daily Brief Equity Bottom-Up: Oriental Watch Mgmt Call: Big Dividend Yet Again and more

By Smartkarma Daily Briefs | Daily Briefs, Equity Bottom-Up

In today’s briefing:

Oriental Watch Mgmt Call: Big Dividend Yet Again, 50% of Mkt Cap in Cash with >15% Yield Post Rally
Light at the End of the Dark Tunnel for Korean Cosmetics?
Intel Vs. TSMC Monitor: TSMC Soars on Buffett Investment, Why INTC Could Now Revert
Travelsky (696): Beneficiary from Potential Reopening in China
Home Depot Inc: Managing Labor Shortages & Other Developments
Lowe’s Companies: Divestment Of Canadian Retail Operations & Other Drivers
Cisco Systems Inc: Major Drivers
Target Corporation: Partnership With Apple & Other Drivers

Oriental Watch Mgmt Call: Big Dividend Yet Again, 50% of Mkt Cap in Cash with >15% Yield Post Rally

By Sameer Taneja

Oriental Watch (398 HK) paid a 31-cent dividend in its H1FY23 result on the 16th, equating to an annualized dividend yield of 15% on the current share price.
The outlook for the rest of the year is much brighter, given the recovery in China and the inability of the Chinese to travel. October numbers were strong.
The stock trades at a 6.7x PE, with more than 50% of the market capitalization in cash. In slightly better market conditions, this could be a 6 HKD stock.

Light at the End of the Dark Tunnel for Korean Cosmetics?

By Douglas Kim

We believe that there is finally some light showing at the end of the dark tunnel for the two leading Korean cosmetics companies LG H&H and Amorepacific Corp.
These two stocks have underperformed the market in the past year but have started to outperform the market in the past three weeks.
There are credible signs that indoor mask wearing in Korea will be eliminated in Korea on/near March 2023 and that the inbound visitors to Korea will continue to increase significantly.

Intel Vs. TSMC Monitor: TSMC Soars on Buffett Investment, Why INTC Could Now Revert

By Vincent Fernando, CFA

TSMC has outperformed INTC by 23% in just two weeks, which is an extreme divergence in a short period of time by historical standards.
Foreseeable company-specific events or news flow over the next 30 days appears limited.
Valuation remains supportive for INTC and we believe it could recover part of its recent underperformance in the next month.

Travelsky (696): Beneficiary from Potential Reopening in China

By Henry Soediarko

Travelsky Technology Ltd H (696 HK) is a system provider for airports in China that benefit from the reopening plan.
The company is not sensitive to the oil price and it has low debt which makes it attractive compared to the airlines.
The stock is trading at a 40% PBR discount to Shanghai International Airport. Historically, the company is trading at a 50% discount to its 5-year high on PBR.

Home Depot Inc: Managing Labor Shortages & Other Developments

Home Depot delivered another good result and surpassed Wall Street expectations in terms of revenues as well as earnings.
The company continued to observe high demand for home renovation projects throughout the third quarter.
Sales growth for both Pro and DIY was good, with Pro surpassing DIY.

Lowe’s Companies: Divestment Of Canadian Retail Operations & Other Drivers

Lowe’s delivered an impressive set of results this quarter and managed to surpass Wall Street expectations in terms of revenues as well as earnings.
The company’s Pro business maintained its momentum, resulting from the success of its Pro efforts and the tenacity of the demand for home renovation.
Their ongoing focus on productivity and solid sales growth contributed to improved operating performance which ensured the earnings beat.

Cisco Systems Inc: Major Drivers

Cisco had a good start to fiscal 2023 and managed to deliver an all-around beat.
The management continued their shift to greater software and subscription-based recurring revenue, even as they proactively manage through a developing and complicated market environment.
Web-scale orders increased by double digits or more on a trailing 12-month basis for the ninth consecutive quarter.

Target Corporation: Partnership With Apple & Other Drivers