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Smartkarma Daily Briefs

Oct 24
0

Daily Brief Consumer: Welcia Holdings and more

By | Consumer, Daily Briefs

In today’s briefing:

  • Welcia Challenges Cosmos in Kyushu

Welcia Challenges Cosmos in Kyushu

By Michael Causton

  • Welcia Holdings (3141 JP) and Tsuruha Holdings (3391 JP), the country’s leading drugstore chains, are both looking to expand quickly in Kyushu after only entering the market recently. 
  • This won’t be easy. Kyushu is full of discount retailers led by one of the best discounters, Cosmos Pharmaceutical (3349 JP), which is also a leading drugstore chain.
  • But building a significant market share in the Kyushu market is crucial to competing nationally with these emerging discount leaders.

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Oct 24
0

Daily Brief Industrials: Shenzhen International and more

By | Daily Briefs, Industrials

In today’s briefing:

  • Shenzhen Intl (152 HK): Updates on Latest Developments

Shenzhen Intl (152 HK): Updates on Latest Developments

By Osbert Tang, CFA

  • Given Shenzhen Airlines is already in negative equity, Shenzhen International (152 HK) will not record any of its losses in 2H22, making a big HoH swing in its impact.
  • The injections of Hangzhou and Hefei logistics projects will be completed by end-FY22, bringing in one-off gains. Jul-Aug toll revenue of Shenzhen Expressway (548 HK) has also recovered vs. 1H22.
  • While there will not be profit at logistics parks transformation business in 2H22, Qianhai Phase II has completed pre-sale in Sep, bring in potentially Rmb3bn to be booked in FY23.

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Oct 24
0

Daily Brief Quantitative Analysis: A-H Premium Weekly (Oct 21st): Remegen and more

By | Daily Briefs, Quantitative Analysis

In today’s briefing:

  • A-H Premium Weekly (Oct 21st): Remegen, Pharmaron, Flat Glass, Shanghai Fudan, GWM, China Life

A-H Premium Weekly (Oct 21st): Remegen, Pharmaron, Flat Glass, Shanghai Fudan, GWM, China Life

By Ke Yan, CFA, FRM

  • We analyse the changes of A-H premium on 142 stocks over the last week. The average A-H premium was 127.4% as of Oct 21st.
  • The average A-H premium changed by -2.8ppt weeok on week, led by consumer staples, consumer discretionary, energy and offset by financials.
  • We highlight weekly changes in A-H premium for Remegen, Pharmaron, Flat Glass, Shanghai Fudan, GWM, China Life.

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Oct 24
0

Daily Brief Credit: Morning Views Asia: China SCE and more

By | Credit, Daily Briefs

In today’s briefing:

  • Morning Views Asia: China SCE, JSW Steel Ltd, Reliance Industries, UPL Ltd

Morning Views Asia: China SCE, JSW Steel Ltd, Reliance Industries, UPL Ltd

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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Oct 24
0

Daily Brief ECM: Giant Biogene IPO: Valuation First Look and more

By | Daily Briefs, ECM

In today’s briefing:

  • Giant Biogene IPO: Valuation First Look

Giant Biogene IPO: Valuation First Look

By Arun George

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Oct 24
0

Daily Brief Equity Bottom-Up: Renesas (6723) | Bullish Toyota Troubles and more

By | Daily Briefs, Equity Bottom-Up

In today’s briefing:

  • Renesas (6723) | Bullish Toyota Troubles
  • Hon Hai: U.S. Chip Restrictions Vs. China Have Put Hon Hai in a Stronger Than Ever Position
  • Welcia Challenges Cosmos in Kyushu
  • Shenzhen Intl (152 HK): Updates on Latest Developments
  • Taiwan Tech Weekly: ASML & Lam Provide Industry Optimism, Wave of Earnings This Week
  • Taiwan Dual-Listings: TSMC Premium Near-Term High, ASE Spikes, UMC High as Well

Renesas (6723) | Bullish Toyota Troubles

By Mark Chadwick

  • We remain bullish on the stock price ahead of Q3 earnings
  • We expect the company to surprise the market given stronger volumes and pricing trends
  • If Toyota is having problems securing a stable supply of chips, we believe that industry inventories are much leaner than most believe

Hon Hai: U.S. Chip Restrictions Vs. China Have Put Hon Hai in a Stronger Than Ever Position

By Vincent Fernando, CFA

  • U.S. chip restrictions have hobbled Hon Hai’s China EV competition.
  • AI and advanced semiconductors will become a necessity for a globally competitive EV platform and Hon Hai appears to be moving aggressively to capture this opportunity.
  • The shares should see topline growth and major margin expansion into 2025, and the market appears to have not yet priced-in Hon Hai’s latest advantageous position.

Welcia Challenges Cosmos in Kyushu

By Michael Causton

  • Welcia Holdings (3141 JP) and Tsuruha Holdings (3391 JP), the country’s leading drugstore chains, are both looking to expand quickly in Kyushu after only entering the market recently. 
  • This won’t be easy. Kyushu is full of discount retailers led by one of the best discounters, Cosmos Pharmaceutical (3349 JP), which is also a leading drugstore chain.
  • But building a significant market share in the Kyushu market is crucial to competing nationally with these emerging discount leaders.

Shenzhen Intl (152 HK): Updates on Latest Developments

By Osbert Tang, CFA

  • Given Shenzhen Airlines is already in negative equity, Shenzhen International (152 HK) will not record any of its losses in 2H22, making a big HoH swing in its impact.
  • The injections of Hangzhou and Hefei logistics projects will be completed by end-FY22, bringing in one-off gains. Jul-Aug toll revenue of Shenzhen Expressway (548 HK) has also recovered vs. 1H22.
  • While there will not be profit at logistics parks transformation business in 2H22, Qianhai Phase II has completed pre-sale in Sep, bring in potentially Rmb3bn to be booked in FY23.

Taiwan Tech Weekly: ASML & Lam Provide Industry Optimism, Wave of Earnings This Week

By Vincent Fernando, CFA

  • ASML and Lam Research beat estimates last week and provided some relief to the semiconductor space.
  • Major global industry earnings coming this week include — Samsung, SK Hynix, Texas Instruments, KLA Tencor, Apple, and Intel.
  • Major Taiwan earnings this week — AUO, UMC, ASE, Realtek, Delta Electronics, Mediatek.

Taiwan Dual-Listings: TSMC Premium Near-Term High, ASE Spikes, UMC High as Well

By Vincent Fernando, CFA

  • TSMC’s ADR premium has rebounded and is high relative to its recent trading range.
  • ASE Technology’s ADR premium has spiked to a historically very high level.
  • UMC ADRs are also trading at a relatively high premium.

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Oct 24
0

Daily Brief Thematic (Sector/Industry): Interpretation of the 20th National Congress of the CPC and the Impact on China Healthcare and more

By | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

  • Interpretation of the 20th National Congress of the CPC and the Impact on China Healthcare
  • Weekly Stock Bullfinder – Week of 10/24

Interpretation of the 20th National Congress of the CPC and the Impact on China Healthcare

By Xinyao (Criss) Wang

  • To realize reunification of the motherland and great rejuvenation of the Chinese nation, China needs to have sufficient foundation- Some key industries would be prioritized in the great power game.
  • The 20th National Congress raised the strategic capability to the highest level, which is to ensure security and emphasize bottom-line thinking. “Innovation” should serve the big goal of national strategic needs. 
  • Every major shift and political guidance of the industry means opportunities and challenges on a large scale. Investors are advised to change the thinking mode and expectation on China healthcare.

Weekly Stock Bullfinder – Week of 10/24

By Weekly Stock Bull Finder

  • This past week, 10 year Treasury yields continued to march higher, with the 10 year Treasury yield eclipsing above 4.2% for the first time since 2008.
  • Treasury yields have now gone up almost in a straight line the 12 straight weeks.
  • After tough “Fed speak” for the past few months, the market appeared to pick up upon hints of dovish Fed commentary on Friday which was coupled by the “Fed whisperer” Wall St. Journal reporter indicating a “step down” from aggressive rate hikes may be soon on the horizon.

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Oct 24
0

Daily Brief Event-Driven: S&P/​​​​​ASX Index Rebalance Preview: Moving the Right Way and more

By | Daily Briefs, Event-Driven

In today’s briefing:

  • S&P/​​​​​ASX Index Rebalance Preview: Moving the Right Way
  • Socionext (6526) TOPIX Inclusion
  • Weekly Deals Digest (23 Oct) – Link, Nearmap, Pushpay, Tyro, Singapore Medical, DTAC/True, Blibli
  • Issues with WCP & SillaJen for KOSDAQ 150 Special Entry in December
  • Jinke Smart (9666 HK): Boyu’s Offer Now Open
  • Merger Arb Mondays (24 Oct) – Eagle Cement, Fengxiang, Lifestyle, Jinke Services, Genex, Nearmap

S&P/​​​​​ASX Index Rebalance Preview: Moving the Right Way

By Brian Freitas

  • We see one potential change for the S&P/ASX 50 Index and two potential changes for the S&P/ASX 200 at the December rebalance, though some stocks are close to the cutoffs.
  • The potential passive buying on the S&P/ASX 200 (AS51 INDEX) adds will exceed 11 days of ADV while the impact on the other stocks ranges from 1.5-4 days of ADV.
  • Most stocks have been moving the right way and there will be pre-positions built up on some of the stocks. Shorts have been active on a few names too.

Socionext (6526) TOPIX Inclusion

By Travis Lundy

  • System-On-Chip designer and IP purveyor Socionext (6526 JP) is a recent IPO in Japan, born from a spinout of Fujitsu and Panasonic system LSI operations 7+ years ago.
  • Having listed on TSE Prime from the outset, that means it gets TOPIX inclusion at the close of trading 29 November. 
  • Inclusion Float is a bit nebulous. There is a chance we get official company data prior to the TSE announcement, in which case we know more by cob 31 October.

Weekly Deals Digest (23 Oct) – Link, Nearmap, Pushpay, Tyro, Singapore Medical, DTAC/True, Blibli

By Arun George

Issues with WCP & SillaJen for KOSDAQ 150 Special Entry in December

By Sanghyun Park

  • Two other names aim at Special Entry: WCP and SillaJen. Their listing dates are September 30 and October 13. So, they are technically eligible. But they each have their issues.
  • As for WCP, MSCI has not yet assigned a GICS sector. It is unlikely that KRX will put WCP into the KOSDAQ 150 without GICS confirmation.
  • SillaJen is technically eligible as its ADMINISTRATIVE designation got terminated. But the rule allowing for KRX’s arbitrary judgment can act as an uncertainty factor.

Jinke Smart (9666 HK): Boyu’s Offer Now Open

By David Blennerhassett

  • On the 27th of September, PRC-incorporated property management play Jinke Smart Services (9666 HK) announced a voluntary cash offer at HK$12/share, a 33.04% premium to last close.
  • Boyu, the Offeror, together with concert parties, hold more than 60%. The Offer is contingent on regulatory approvals and 7.71% of shares out tendering. The tendering condition can be waived.
  • The Composite Document has now been despatched. The first closing date is the 14 November.

Merger Arb Mondays (24 Oct) – Eagle Cement, Fengxiang, Lifestyle, Jinke Services, Genex, Nearmap

By Arun George

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Oct 24
0

Daily Brief Macro: Fear of being out replaced by fear of being in (anything but $ cash) and more

By | Daily Briefs, Macro

In today’s briefing:

  • Fear of being out replaced by fear of being in (anything but $ cash)
  • Why Inflation Is A Game Changer For Portfolios
  • Five Constructive Signs of a Short-Term Bottom

Fear of being out replaced by fear of being in (anything but $ cash)

By Mark Tinker

  • The most crowded trade in markets at the moment is $ cash.
  • Fear rather than greed is dominating sentiment for both retail and professional investors and, with yields approaching 4%, cash is back as an asset class once more.
  • Of course, this time last year, there was also fear driving the markets, except then it was a case of FOMO, Fear of Missing Out ; of ARKK, or Crypto, or meme stocks, or SPACs.

Why Inflation Is A Game Changer For Portfolios

By Cam Hui

  • Rising inflation has played havoc with 60/40 portfolios as bond prices haven’t provided a counterweight to falling stock prices.
  • A study reveals that underlying inflation trends are decelerating which should be positive to risk appetite expectations.
  • We believe that the inflation and market pivot is just around the corner and it may be closer than the market expects.

Five Constructive Signs of a Short-Term Bottom

By Cam Hui

  • A combination of factors are serving to signal a possible tactical bottom and put a floor on stock prices.
  • Investors should recognize that the current environment has been dominated by a single macro trade, the inverse correlation of the S&P 500 with the USD.
  • Should interest rate expectations rise further to boost the dollar, it would represent a significant headwind for stock prices.

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Oct 24
0

Daily Brief Crypto: Earn Yield on Bitcoin and more

By | Crypto, Daily Briefs

In today’s briefing:

  • Earn Yield on Bitcoin

Earn Yield on Bitcoin

By Edward Wu

  • There is no yield can be earned directly on the Bitcoin network, tokenized BTC on Ethereum open up yield opportunities.
  • Using a combination of Curve Finance and Convex Finance, one can earn around 2% yield on BTC.
  • Non-Stable pools in both Curve Finance and Uniswap v3 provide higher yield, however, one needs to consider the impermanent loss when providing liquidity for these pools.

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