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Smartkarma Daily Briefs

Mar 25
0

Daily Brief India: LG Electronics India, Borosil Renewables, Adani Enterprises, NIFTY Index, Bajaj Finance Ltd, SGX Rubber Future TSR20 and more

By | Daily Briefs, India

In today’s briefing:

  • LG Electronics India IPO: It’s A Big Deal. Potential Pricing and Valuation Preview
  • Insiders’ Playbook: Who’s Buying and Selling Amid Market Turbulence?
  • What Does Adani’s Foray into Wires & Cables Mean for Investors and the Industry?
  • NSE NIFTY50/ Vol Update / Expiry Day Shifted to Mondays – Expect Major Changes in Vol Dynamics
  • Bajaj Finance: The Overhang Clears as Rajeev Jain Steps Up as Vice Chairman
  • Indian Rubber Prices Soar As Rubber Board Prepares For EUDR

LG Electronics India IPO: It’s A Big Deal. Potential Pricing and Valuation Preview

By Devi Subhakesan

  • LG Electronics India has secured regulatory approval for its IPO, expected to raise between USD 1 to 1.5 billion. 
  • However, it remains unclear whether the company will delay the launch until market sentiment shows further improvement.
  • LG Electronics India (123D IN) IPO is a 100% offer for sale by parent and hence the entire proceeds from the IPO will accrue to LG Electronics (066570 KS).

Insiders’ Playbook: Who’s Buying and Selling Amid Market Turbulence?

By Nimish Maheshwari

  • The start of 2025 has been particularly turbulent for Indian equities as broader market sentiment soured due to elevated valuations, foreign institutional investor (FII) outflows, and global macro uncertainty. 
  • However, amid this volatility, one signal stood out: insider trading activity.
  • In this report, we deep-dive into insider buying and selling trends from January 1 to March 3, 2025, to uncover where company promoters and top executives are placing their bets

What Does Adani’s Foray into Wires & Cables Mean for Investors and the Industry?

By Nimish Maheshwari

  • Investors should keep a close eye on Adani’s execution timeline, the impact on valuations in the sector, and the fundamentals of existing players in the C&W industry. 
  • While Adani’s entry may bring some disruption, the sector’s strong growth prospects and the resilience of leading players suggest that there is still value to be found. 
  • In the end, long-term success in this industry will depend on a combination of strategic vision, operational excellence, and the ability to adapt to changing market dynamics.

NSE NIFTY50/ Vol Update / Expiry Day Shifted to Mondays – Expect Major Changes in Vol Dynamics

By Sankalp Singh

  • Effective 05.04.2025, Expiry for Options will be moved from Thursday to Monday. Premiums still adjusting to retroactive implementation of the technical change.
  • Option markets shun additional risk premia on account of U.S. trade tensions – IVs remain subdued. Vol-state transitioned to “Low & Down” & term-structure pushed further into Contango.  
  • IVs were higher on the weekly open, but premiums decayed rapidly post U.S. Fed event risk. Skew has unwound its earlier compression.

Bajaj Finance: The Overhang Clears as Rajeev Jain Steps Up as Vice Chairman

By Sudarshan Bhandari

  • Rajeev Jain elevated to Vice Chairman and Executive Director; Anup Saha to take over as MD from April 2025, ensuring continuity at India’s top consumer finance company.
  • Jain’s continued executive role removes leadership overhang, reinforcing confidence in Bajaj Finance’s Long-Range Strategy 2029 amid rising competitive intensity in digital lending.
  • Succession clarity and strategic alignment suggest Bajaj Finance is not just preserving momentum—but doubling down on execution for its next phase of scale and innovation.

Indian Rubber Prices Soar As Rubber Board Prepares For EUDR

By Vinod Nedumudy

  • Prices crosses the magical level of INR 200/kg after five months  
  • Supply short but farmers who stock and didn’t rainguard benefit  
  •  Rubber Board starts geo-mapping of rubber plantations

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Mar 25
0

Daily Brief Japan: Tokyu Reit Inc, Sun Corp, Torikizoku, Nitto Kogyo and more

By | Daily Briefs, Japan

In today’s briefing:

  • Tokyu Corp (9005) To Lift Stake in Tokyu REIT (8957) Again – Bigger Than You Think It Is
  • StubWorld: Sun Corp (6736 JP) Is Still Inexpensive To Its Cellebrite Stake
  • Torikizoku (3193 JP): Coverage Initiation,1H FY07/25 flash update
  • Nitto Kogyo Corporation (6651 JP) – Q3 Follow-Up

Tokyu Corp (9005) To Lift Stake in Tokyu REIT (8957) Again – Bigger Than You Think It Is

By Travis Lundy

  • Today, Tokyu Corp (9005 JP) announced it would increase its stake its family REIT, buying up to 48,880 units or 5.0% of units out over the next six months.
  • This comes a couple of days after Hankyu Hanshin announced the same for its REIT, discussed here. Others have done so before. Tokyu has. Others will do so going forward. 
  • The main reason? Squeeze the ‘share’ price higher. Get the REIT to 1.0x PNAV then stuff it with sponsor-held properties. That’s not bad. The goal is a higher price.

StubWorld: Sun Corp (6736 JP) Is Still Inexpensive To Its Cellebrite Stake

By David Blennerhassett

  • Sun Corp (6736 JP) has declined ~6% in the past month. Its 44.3% stake in Cellebrite DI (CLBT US) is worth ~186% of its market cap.
  • Preceding my comments on Sun Corp are the current setup/unwind tables for Asia-Pacific Holdcos.
  • These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation >20%.

Torikizoku (3193 JP): Coverage Initiation,1H FY07/25 flash update

By Shared Research

  • Revenue increased by 10.7% YoY to JPY22.2bn, driven by inbound tourism recovery and new restaurant openings.
  • Operating profit declined 20.5% YoY to JPY1.3bn due to higher SG&A expenses from overseas expansion and wage increases.
  • Gross profit margin decreased to 69.1%, while SG&A ratio rose to 63.1%, impacting operating profit margin.

Nitto Kogyo Corporation (6651 JP) – Q3 Follow-Up

By Sessa Investment Research

  • Q3 2025/3 Earnings Result Summary: Nitto Kogyo Corporation (hereafter, the Company) announced net sales of JPY 133,354 mn (+14.1% YoY), operating profit of JPY 9,298 mn (+3.3% YoY), ordinary profit of JPY 9,503 mn (-0.0% YoY), and profit attributable to owners of parent (hereafter, net profit) of JPY 9,014 mn (+36.3% YoY).
  • The double-digit increase in net profit was attributed to the recording of extraordinary gains on the acquisition of shares in a subsidiary.
  • FY2025/3 Earnings Forecast: The forecast calls for net sales of JPY178,000 mn (+10.8% YoY), operating profit of JPY12,000 mn (+0.3% YoY), ordinary profit of JPY12,000 mn (-4.5% YoY), and net profit of JPY10,000 mn (+14.7% YoY).

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Mar 25
0

Most Read: BayCurrent Consulting , NetEase , Sun Corp, Xiaomi Corp, Korea Stock Exchange Kospi Index, Tokyu Reit Inc, Guangzhou Automobile Group, Gold Road Resources, CRH and more

By | Daily Briefs, Most Read

In today’s briefing:

  • The Japan March-End Rebal and Dividend Trade
  • Hang Seng Indexes: FAF Methodology Change for Secondary Listings; Over US$1bn to Buy in NetEase
  • Sun Corp (6736) – Still Cheap
  • Xiaomi (1810 HK)’s US$5bn Placement: Unfavourable Index Dynamics but Strong Momentum
  • Korea’s FSC Just Dropped the Final Playbook on the Full Restart of Short Selling.
  • Tokyu Corp (9005) To Lift Stake in Tokyu REIT (8957) Again – Bigger Than You Think It Is
  • A/H Premium Tracker (To 21 Mar 2025):  AH Premia Still Falling; Expect Curve Torsion or AH Widening
  • Xiaomi US$5.3bn Placement – Relatively Small, Strong Momentum but Is Expensive
  • Gold Road (GOR AU): Rejects an NBIO from Gold Fields (GFI US)
  • [Quiddity Index Mar25] S&P500/600 Jun25 Rebal: Early Days But a Few Intrareview Changes Possible

The Japan March-End Rebal and Dividend Trade

By Travis Lundy

  • Every year it’s the same trade. But sometimes it is not. This year it is Thursday and Friday. Or not.
  • The month-end and quarter-end bring big flows, or not, depending on how things have gone.
  • Over the past 10 years or so, the two-day return on the March trade is pretty good. This year? Well read on!

Hang Seng Indexes: FAF Methodology Change for Secondary Listings; Over US$1bn to Buy in NetEase

By Brian Freitas

Sun Corp (6736) – Still Cheap

By Travis Lundy

  • Eight months on from the Tender Offer which changed the shape of the shareholder register, Sun Corp (6736 JP) is as cheap to its main asset as it was before.
  • Sun Corp is cheap to its holding in Cellebrite DI (CLBT US). How cheap depends on the form and structure of its eventual exit. 
  • Understanding what the options are (and the dynamics around hedging/exposure) is worthwhile.

Xiaomi (1810 HK)’s US$5bn Placement: Unfavourable Index Dynamics but Strong Momentum

By Brian Freitas

  • Xiaomi Corp (1810 HK) is looking to place 750m shares at a price range of HK$52.8-54.6/share, a 4.2-7.4% discount from last. That could raise up to HK$40.95bn (US$5.27bn).
  • There will be limited passive buying near-term. There will be more passive buying at the end of May. Then there will be passive selling early June.
  • Shorts will be hurting from the relentless move higher in the stock and there could be short covering if the stock moves lower from these levels.

Korea’s FSC Just Dropped the Final Playbook on the Full Restart of Short Selling.

By Sanghyun Park

  • Today’s update clarifies which brokers are fully linked to NSDS, giving them an edge in short-selling speed and flexibility, while others face more execution constraints.
  • This leads to a clear execution risk gap, requiring traders to factor in trade efficiency differences based on their broker.
  • With lower short-selling restriction triggers, liquidity and short-covering dynamics will shift, requiring traders to reassess market impact and adjust strategies accordingly.

Tokyu Corp (9005) To Lift Stake in Tokyu REIT (8957) Again – Bigger Than You Think It Is

By Travis Lundy

  • Today, Tokyu Corp (9005 JP) announced it would increase its stake its family REIT, buying up to 48,880 units or 5.0% of units out over the next six months.
  • This comes a couple of days after Hankyu Hanshin announced the same for its REIT, discussed here. Others have done so before. Tokyu has. Others will do so going forward. 
  • The main reason? Squeeze the ‘share’ price higher. Get the REIT to 1.0x PNAV then stuff it with sponsor-held properties. That’s not bad. The goal is a higher price.

A/H Premium Tracker (To 21 Mar 2025):  AH Premia Still Falling; Expect Curve Torsion or AH Widening

By Travis Lundy

  • AH Premia continue to fall. Spread curve torsion was a barbell this week. Narrow and wide spreads see Hs outperform. Middling spreads outperform less.
  • To me, warning signs are flashing on spreads. They are at their narrowest in 5yrs and they are volatile, though volatility is coming down.
  • Lots of spreads see the HA premium less than 15%. That is historically tight.

Xiaomi US$5.3bn Placement – Relatively Small, Strong Momentum but Is Expensive

By Sumeet Singh

  • Xiaomi Corp (1810 HK) is looking to raise around US$5.3bn via selling 3% additional shares.
  • The shares have done exceedingly well this year and are now trading at their all time highs.
  • In this note, we will talk about the placement and run the deal through our ECM framework.

Gold Road (GOR AU): Rejects an NBIO from Gold Fields (GFI US)

By Arun George

  • Gold Road Resources (GOR AU) has rejected a non-binding proposal from Gold Fields (GFI US). The offer is A$2.27 plus value per share of Gold Road’s shareholding in De Grey.
  • The Board has rejected the offer mainly due to opportunistic timing and no value attributed to the potential underground expansion of the Gruyere mine (Gold Road/Gold Fields are JV partners).
  • The proposal is a logical consolidation to eliminate dis-synergies. The offer is reasonable compared to peer multiples, precedent transactions and historical trading ranges. 

[Quiddity Index Mar25] S&P500/600 Jun25 Rebal: Early Days But a Few Intrareview Changes Possible

By Travis Lundy

  • The S&P 500 index tracks the 500 largest names listed in the US and it is one of the most highly-tracked indices in the world.
  • In this insight, we take a look at the upcoming constituent changes in the run up to the June 2025 index rebal event.
  • We expect two regular changes in June 2025. There are also multiple live spin-off and M&A events which are likely to trigger intra-review index changes.

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Mar 24
0

Daily Brief Quantitative Analysis: Thailand Short Interest Weekly (Mar 21st): PTT and more

By | Daily Briefs, Quantitative Analysis

In today’s briefing:

  • Thailand Short Interest Weekly (Mar 21st): PTT, SCC, Krung Thai Bank, True, Srisawad
  • KRX Foreign Holding Weekly (Mar 21st): Samsung Electronics, SK Hynix, Hanwha Aerospace
  • Hong Kong Connect Flows (Mar 21st): Ke, China Mobile, Alibaba, Kuaishou, BOC, CR Beer, SMIC
  • A-H Premium Weekly (Mar 21st): 47 Stocks at 52 Week High A-H Premium
  • HK Short Interest Weekly: Trip.Com, ABC, BYD
  • TWSE Foreign Holding Weekly (Mar 21st): Yang Ming, Hon Hai Precision Industry, TSMC, Quanta Computer
  • TWSE Short Interest Weekly (Mar 21st): Ctbc Financial, Asustek Computer, Mediatek, Alchip

Thailand Short Interest Weekly (Mar 21st): PTT, SCC, Krung Thai Bank, True, Srisawad

By Ke Yan, CFA, FRM

  • We analyzed the changes in short interest of Stock Exchange of Thailand as of Mar 21st.We estimate that they had an aggregated short interest worth USD2.0bn.
  • We tabulate league table for top short by value and short as multiple of ADT, as well as weekly increases & decreases in short value, short as multiple of ADT.
  • We highlight short interest changes in PTT, SCC, Krung Thai Bank, True, Srisawad.

KRX Foreign Holding Weekly (Mar 21st): Samsung Electronics, SK Hynix, Hanwha Aerospace

By Ke Yan, CFA, FRM

  • We analyzed the changes in foreign holdings of KRX stocks as of Mar 21st which has an aggregated holding worth USD500.4bn.
  • We estimate that foreign flows to be inflows of USD1,889mln. We tabulate the league table for top changes by value for 1W/4W/1Y and top stocks held by foreign institutions.
  • We highlight changes of foreign holdings in Samsung Electronics, SK Hynix, Hanwha Aerospace.

Hong Kong Connect Flows (Mar 21st): Ke, China Mobile, Alibaba, Kuaishou, BOC, CR Beer, SMIC

By Ke Yan, CFA, FRM

  • We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of March 21st.
  • The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.
  • We highlight flows for Ke, China Mobile, Alibaba, Kuaishou, BOC, China Resources Beer, SMIC, Meituan.

A-H Premium Weekly (Mar 21st): 47 Stocks at 52 Week High A-H Premium

By Ke Yan, CFA, FRM

  • We analyse the changes of A-H premium on 150 stocks over the last week. The average A-H premium was 83.3% as of Mar 21st.
  • The average A-H premium changed by -0.4ppt week-on-week, led by utilities, consumer discretionary, communication services and offset by consumer staples, financials.
  • We highlight weekly changes in A-H premium for Huadian Power, Livzon Pharma, Joinn Lab, Maanshan Iron&Steel, Datang Intl Power.

HK Short Interest Weekly: Trip.Com, ABC, BYD

By Ke Yan, CFA, FRM

  • We analyzed the latest HK SFC report for aggregate short position as of Mar 14th.
  • Top short increases and decreases were tabulated for one week and four week period. 
  • We highlight short changes in Trip.Com (9961 HK), ABC (1288 HK), BYD (1211 HK).

TWSE Foreign Holding Weekly (Mar 21st): Yang Ming, Hon Hai Precision Industry, TSMC, Quanta Computer

By Ke Yan, CFA, FRM

  • We analyzed the changes in foreign holdings of TWSE Stocks as of Mar 21st which has an aggregated holding worth USD931.3bn.
  • We estimate that foreign flows to be outflows of USD1,594mln. We tabulate the league table for top changes by value for 1W/4W/1Y and top stocks held by foreign institutions.
  • We highlight changes of foreign holdings in Yang Ming Marine, Hon Hai Precision Industry, TSMC, Quanta Computer.

TWSE Short Interest Weekly (Mar 21st): Ctbc Financial, Asustek Computer, Mediatek, Alchip

By Ke Yan, CFA, FRM

  • We analyzed the changes in short interest of TWSE Stocks as of Mar 21st which has an aggregated short interest worth USD21.1bn.
  • We tabulate league table for top short by value and short as multiple of ADT, as well as weekly increases & decreases in short value, short as multiple of ADT.
  • We highlight short interest changes in Ctbc Financial, Asustek Computer, Mediatek, Alchip Technologies, Innolux, Elite Advanced Laser.

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Mar 24
0

Daily Brief ESG: TSE Growth Market Reforms Also Expected to Be Effective in “Request” and more

By | Daily Briefs, ESG

In today’s briefing:

  • TSE Growth Market Reforms Also Expected to Be Effective in “Request”

TSE Growth Market Reforms Also Expected to Be Effective in “Request”

By Aki Matsumoto

  • A drastic shift by the TSE to focus on quality without increasing the number of listed companies by reducing the number of IPO companies is not very promising.
  • TSE will raise the hurdle for listing maintenance criteria slightly, but it will ask companies to make a commitment to post-listing growth during the listing examination process.
  • It’ll take time for quality of market to increase, and we expect that companies that are aware of listing costs with help from investors will naturally move to de-list themselves.

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Mar 24
0

Daily Brief Thematic (Sector/Industry): Ohayo Japan | US Stocks Rebound as Trump Hints at Tariff Flexibility and more

By | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

  • Ohayo Japan | US Stocks Rebound as Trump Hints at Tariff Flexibility
  • [Blue Lotus China New Consumer Weekly, 12/52] Choice of the Less Evil Between Trumponomics’ Outcomes

Ohayo Japan | US Stocks Rebound as Trump Hints at Tariff Flexibility

By Mark Chadwick

  • US stocks climbed Friday, with the S&P 500 rising 0.1%; index snapped four-week losing streak
  • ITOCHU plans to increase its iron ore production to 40 million tons per year by FY2030, up 1.5 times current levels
  • Nidec will boost production of water cooling equipment for AI data centers, investing ¥5 billion in a Thai plant.

[Blue Lotus China New Consumer Weekly, 12/52] Choice of the Less Evil Between Trumponomics’ Outcomes

By Eric Wen

  • China’s economic data continued to be mixed. The on-again-off-again patter is here to stay. PBOC’s stated policy to follow the US means Trumponomics’s next read is critical to China, too;
  • Whether it is positive or negative to our sector depends on whether the view is half full or half empty. Stimulus will increasingly become irrelevant;
  • China EV posted strong numbers which cannot be explained by trade-in subsidy alone. Earning flash of Xiaomi, LI and Zeekr. 

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Mar 24
0

Daily Brief ECM: Didi Global Q424 Results: Another Set of Solid Numbers from China’s Ride Hailing Giant and more

By | Daily Briefs, ECM

In today’s briefing:

  • Didi Global Q424 Results: Another Set of Solid Numbers from China’s Ride Hailing Giant
  • Jiangsu Zenergy Battery Technologies Pre- IPO – The Positives – Brisk Volume-Led Growth
  • ECM Weekly (24th Mar 2025) -JX Advance, DN Solutions, Nanshan Aluminimum, Anthem, EAAA, Judo Capital

Didi Global Q424 Results: Another Set of Solid Numbers from China’s Ride Hailing Giant

By Daniel Hellberg

  • Most key P&L items and revenue drivers improved Y/Y and sequentially vs Q324
  • Although GTV per transaction dipped slightly, estimated “take rate” improved in Q424
  • Strong OpCF obviates need for quick FY25 IPO — but it could still happen this year

Jiangsu Zenergy Battery Technologies Pre- IPO – The Positives – Brisk Volume-Led Growth

By Akshat Shah

  • Jiangsu Zenergy Battery Technologies (JSZENERGY CH) (Zenergy) is looking to raise up to US$300m in its upcoming HK IPO.
  • Zenergy is an EV and energy storage system battery manufacturer providing integrated battery solutions, encompassing battery cells, modules, packs and battery management systems dedicated to large-scale applications of electrochemical products.
  • In this note, we talk about the positive aspects of the deal.

ECM Weekly (24th Mar 2025) -JX Advance, DN Solutions, Nanshan Aluminimum, Anthem, EAAA, Judo Capital

By Sumeet Singh

  • Aequitas Research’s weekly update on the IPOs, placements, lockup expiry and other ECM linked events that were covered by the team over the past week.
  • On the IPO front, JX Advanced Metals (5016 JP) managed to hold on to its deal price, riding on the copper price resurgance.
  • On the placements front, Judo Capital (JDO AU) was the only largish deal over the past week.

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Mar 24
0

Daily Brief Event-Driven: Sun Corp (6736) – Still Cheap and more

By | Daily Briefs, Event-Driven

In today’s briefing:

  • Sun Corp (6736) – Still Cheap
  • A/H Premium Tracker (To 21 Mar 2025):  AH Premia Still Falling; Expect Curve Torsion or AH Widening
  • Weekly Deals Digest (23 Mar) – CK Hutchison, Canvest, ENN Energy, HKBN, Fengxiang, Spartan, DN Sols
  • Merger Arb Mondays (24 Mar) – HKBN, ESR, Canvest, Vesync, Seven & I, Proto, Makino, Spartan
  • PC Partners (1263 HK): SGX Primary Listing Justified To Maintain NVIDIA Supply
  • Market Movers: Key Dates at a Glance (March 24-30)
  • Weekly Update (ANGI, IAC, SNRE)

Sun Corp (6736) – Still Cheap

By Travis Lundy

  • Eight months on from the Tender Offer which changed the shape of the shareholder register, Sun Corp (6736 JP) is as cheap to its main asset as it was before.
  • Sun Corp is cheap to its holding in Cellebrite DI (CLBT US). How cheap depends on the form and structure of its eventual exit. 
  • Understanding what the options are (and the dynamics around hedging/exposure) is worthwhile.

A/H Premium Tracker (To 21 Mar 2025):  AH Premia Still Falling; Expect Curve Torsion or AH Widening

By Travis Lundy

  • AH Premia continue to fall. Spread curve torsion was a barbell this week. Narrow and wide spreads see Hs outperform. Middling spreads outperform less.
  • To me, warning signs are flashing on spreads. They are at their narrowest in 5yrs and they are volatile, though volatility is coming down.
  • Lots of spreads see the HA premium less than 15%. That is historically tight.

Weekly Deals Digest (23 Mar) – CK Hutchison, Canvest, ENN Energy, HKBN, Fengxiang, Spartan, DN Sols

By Arun George

Merger Arb Mondays (24 Mar) – HKBN, ESR, Canvest, Vesync, Seven & I, Proto, Makino, Spartan

By Arun George

PC Partners (1263 HK): SGX Primary Listing Justified To Maintain NVIDIA Supply

By David Blennerhassett

  • On the 18th June 2024, PC Partner (1263 HK)‘s board said it was considering an SGX listing, by way of introduction, and applying for the withdrawal of the HKEx listing.
  • A 30th August 2024 announcement provided clarity on a step-by-step approach for the HKEx withdrawal. A secondary listing on the SGX was established on the 15th November.
  • The next step is to establish a dual-primary listing in Singapore. Then withdraw the HKEx listing. The key driver behind this exercise is ensure the uninterrupted supply of NVIDIAs GPUs.

Market Movers: Key Dates at a Glance (March 24-30)

By Gaudenz Schneider

  • India: Index changes for Nifty indices will take place. Multiple option expiries are scheduled, impacting stocks and indices such as the NIFTY 50 Index, and the SENSEX Index.
  • Asia-Pacific: Key events include Hong Kong’s earnings week and Tokyo CPI release, while Australia reports its Monthly CPI indicator.
  • USA: Significant releases include the final Q4 2024 GDP figures and the PCE Price Index, the Fed’s preferred inflation gauge.

Weekly Update (ANGI, IAC, SNRE)

By Richard Howe

  • On March 31, 2025, IAC Inc (IAC) will spin off Angi Inc (ANGI). The first day of trading will be April 1st.

  • Transaction Structure: The spin-off is designed to be tax-free, providing IAC shareholders with direct ownership of Angi. This move will eliminate Angi’s dual-class share structure, transitioning to a one share/one vote system.

  • Distribution Ratio: IAC shareholders will receive approximately 0.5178 shares of Angi Class A common stock for each IAC share they hold. This ratio accounts for a planned 1-for-10 reverse stock split of Angi’s shares, effective March 24, 2025.

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Mar 24
0

Daily Brief Equity Bottom-Up: Meituan (3690 HK): 4Q24 and more

By | Daily Briefs, Equity Bottom-Up

In today’s briefing:

  • Meituan (3690 HK): 4Q24, High Growth and Higher Margin, 60% Upside
  • China Merchants Port (144 HK): Will It Have a Role in CKH’s Port Sale?
  • Taiwan Dual-Listings Monitor: TSMC Headroom Increases Again; ASE at Discount a Long Opportunity
  • Micron. HBM Gets Even Better, NAND Gets Even Worse
  • China Healthcare Weekly (Mar.23)-Fosun Pharma Sells United Family Healthcare, MNC’s Inflection Point
  • ENN Energy (2688 HK): Privatisation or What? A Look at the Valuations
  • Foxconn’s Huge EV Bet Pays Off: Key Mitsubishi Win Could Spark Additional Automaker Deals to Come
  • Fu Shou Yuan (1448.HK) – 2025 Outlook May Remain Sluggish Despite the Ugly 2024 Results
  • Workman Fixes the Big Problem: Colors Replaces Workman Joshi
  • Miniso: Undeterred by Tariffs. IP-Strategy, Global Expansion on Track. Value Buy

Meituan (3690 HK): 4Q24, High Growth and Higher Margin, 60% Upside

By Ming Lu

  • In 4Q24, Meituan’s revenue growth rate was 20% YoY with all businesses rising.
  • The operating margin improved to 8.8% in 4Q24 versus about zero in 4Q23.
  • We set an upside of 61% and a price target of HK$270. Buy.

China Merchants Port (144 HK): Will It Have a Role in CKH’s Port Sale?

By Osbert Tang, CFA

  • China Merchants Port (144 HK) may potentially play a role in CK Hutchison Holdings (1 HK)‘s port portfolio disposal should the mainland government want to step in. 
  • While CMPH’s size is small relative to the port portfolio, its parent China Merchants Group and sister China Merchants Bank H (3968 HK) can easily facilitate such a transaction.
  • Having the portfolio in the hands of mainland company is desirable to the Chinese government. Even if CMPH has no role, its 7.6x PER and 6% yield are attractive.

Taiwan Dual-Listings Monitor: TSMC Headroom Increases Again; ASE at Discount a Long Opportunity

By Vincent Fernando, CFA

  • TSMC: +20% Premium; Wait for Higher Premium Before Shorting, ADR Headroom Has Increased Further
  • UMC: -1.6% Discount; Wait for Lower Discount Before Going Long
  • ASE: -0.1% Discount; Discounts Are Good Level to Long the Spread Given Maxed Headroom

Micron. HBM Gets Even Better, NAND Gets Even Worse

By William Keating

  • Micron this week reported revenues of $8.1 billion, down 8% QoQ but up 38% YoY, and at the top end of the guided range
  • Micron is expecting to reach an annual run rate of $7.8 billion by Q425. Wow!
  • NAND is headed for yet another downturn after six quarters of sequential growth. 

China Healthcare Weekly (Mar.23)-Fosun Pharma Sells United Family Healthcare, MNC’s Inflection Point

By Xinyao (Criss) Wang

  • Given new policy recommendations, it is only a matter of time before HPV vaccination is included in the national immunization program, which is detrimental to HPV vaccine companies.
  • MNCs have seen a inflection point in performance growth in 2024 in China. Although VBP/NRDL negotiation are negative factors, is it also due to any consideration to withdraw from China?
  • Fosun Pharma has agreed to sell its entire stake in United Family Healthcare to Calcite Gem Investments Group for US$124.1 million. We shared our views about the deal.

ENN Energy (2688 HK): Privatisation or What? A Look at the Valuations

By Osbert Tang, CFA

  • ENN Energy (2688 HK) has suspended trading. The possibilities include privatisation, third-party offer, increase in stake by ENN Natural Gas (600803 CH), and a change in control. 
  • It trades on 1.16x 12-month forward P/B, vs. 5-year average of 2.42x and 1.31x since 2024. Given the lower forward ROE, it is difficult to return to the 5-year average.
  • For PER, it should be higher than China Gas Holdings (384 HK) but lower than CR Gas (1193 HK). At 10.8x (average of the two), it equates to HK$74.26.  

Foxconn’s Huge EV Bet Pays Off: Key Mitsubishi Win Could Spark Additional Automaker Deals to Come

By Vincent Fernando, CFA

  • Mitsubishi Motors plans to outsource EV production to Foxconn, signaling the most significant commercial validation of Foxconn’s MIH EV platform to date.
  • While Foxconn’s AI server manufacturing is currently the company’s strongest growth driver, its EV strategy is increasingly gaining credibility as a second long-term pillar.
  • Foxconn — Structural Long. We see depressed share price as buying opportunity. Mitsubishi contract win increases the probability for additional major OEM production partnership wins this year for Foxconn.

Fu Shou Yuan (1448.HK) – 2025 Outlook May Remain Sluggish Despite the Ugly 2024 Results

By Xinyao (Criss) Wang

  • Fu Shou Yuan had a sharp decline in performance in 2024. The performance in recent years has often missed management guidance, which makes us question the integrity of management.
  • The “crisis” of Fu Shou Yuan has evolved from a short-term headwind to the failure of its long-term business model. Good dividends cannot conceal the problem of gloomy outlook.
  • Valuation logic is undergoing a transformation – from a leading company with “high growth/stable cash flow” to a struggling company with “weak growth/questionable profit model”. 2025 performance may remain lower-than-expected.

Workman Fixes the Big Problem: Colors Replaces Workman Joshi

By Michael Causton

  • Workman’s slower same-store growth can be blamed on its shift to mass market fashion and the choice of Workman Joshi as a banner, putting off male customers. 
  • The outdoor and workwear retailer has now acknowledged the misstep and will rebrand the chain as Workman Colors while adjusting merchandise back to more apparel basics.
  • This will take time to implement but could mean a return to form for the apparel retailer.

Miniso: Undeterred by Tariffs. IP-Strategy, Global Expansion on Track. Value Buy

By Devi Subhakesan

  • MINISO Group Holding (9896 HK) committed to expanding in the U.S. with plans in place to mitigate the impact of U.S. tariffs on Chinese goods via its diversified supply chain strategy.
  • Key investor concern: Slower store expansion in Mainland China in 2025 may temper near-term sales and profit growth. Capital intensive overseas expansion could dilute potential returns.
  • Miniso (MNSO US)’s accelerating shift toward higher-margin IP co-branded lifestyle products—a strategy poised to sustain double-digit revenue growth, makes it an attractive investment play in the lifestyle retail space.

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Mar 24
0

Daily Brief Macro: How to Trade the Momentum Reversal and more

By | Daily Briefs, Macro

In today’s briefing:

  • How to Trade the Momentum Reversal
  • The U.S. Bear Market: SELL THE RALLY!
  • Japan Morning Connection: Micon After Market Gains Fail to Follow-Through
  • Fed Tapers QT to Pre-Empt Debt Ceiling Increase as Forward Interest Rate Guidance Remains Unchanged
  • Iron Ore Tracker (24-Mar-2025): Iron Ore At Support Levels of 100 USD/Ton
  • Copper Tracker 24th March 2025: China “Special Action Consumption Plan”/Comex Spreads Stratospheric
  • The Fed’s Next Move: How Interest Rates Will Make or Break Your Portfolio

How to Trade the Momentum Reversal

By Cam Hui

  • Global equity markets saw a sudden reversal in risk appetite out of the Magnificent Seven.
  • While risk appetite has recovered in the U.S. equity market and a relief rally will likely continue, the jury is still out on whether the stampede into non-U.S. will continue.
  • Reiterate our view that any relief rally is unlikely to be sustainable. Investors may be better served by diversifying their U.S. exposure into non-U.S. equities for the coming market cycle.

The U.S. Bear Market: SELL THE RALLY!

By David Mudd

  • The initial target range for the S&P in the US bear market is 4800 to 5000. This level also coincides with the technical level of -20% from the top.
  • The stock market and economy in the US are highly co-dependent, and the bear market will cause consumption to fall more than in previous market downturns.
  • Foreign investors have started to reduce their overweight US allocations quickly.  Retiree “Sequence of Returns Risk” will add to selling pressure in the US market.

Japan Morning Connection: Micon After Market Gains Fail to Follow-Through

By Andrew Jackson

  • Micon management blaming soft NAND pricing, yet the outlook looks bright with price hikes on the horizon for April.
  • Trump announcing the F-47 fighter jet after his status as 47th president sending Boeing up and Lockheed down
  • Mega banks and Reginal banks posted sizable gains in Japan last week on expectations for higher yields. Looks priced in, but markets need something to chase with AI fever waning. 

Fed Tapers QT to Pre-Empt Debt Ceiling Increase as Forward Interest Rate Guidance Remains Unchanged

By Said Desaque

  • The Fed modestly revised economic growth expectations downwards for 2025 and next year and chose not to alter forward guidance. Two anticipated policy rate reductions in 2025 remain intact.
  • Significant tapering of quantitative tightening was announced in anticipation of a debt ceiling agreement being reached. Higher Treasury borrowing could reduce reserves in the banking system, potentially creating financial instability.   
  • Short-Term survey-based measures of consumers’ inflationary expectations have seemingly become more unhinged in 2025, but this should not prevent the Fed from switching to easier policy settings if required.

Iron Ore Tracker (24-Mar-2025): Iron Ore At Support Levels of 100 USD/Ton

By Sameer Taneja

  • Mixed data from China shows property prices down 5-7% YoY and lower land sales YTD, while weaker U.S. consumer sentiment has also negatively impacted overall commodity prices.
  • China’s total social financing (TSF) for Jan-Feb reached 9.29 trillion RMB (Vs. consensus 9.75 trillion RMB). However, this figure is +16.6% YoY, signaling that substantial stimulus measures are in effect.
  • We expect iron ore prices to remain rangebound between 95-120 USD/ton over the next few months as cost support is strong at the 100 USD/ton level. 

Copper Tracker 24th March 2025: China “Special Action Consumption Plan”/Comex Spreads Stratospheric

By Sameer Taneja

  • Copper prices are receiving a favorable lift following the announcement of China’s “Special Action Plan to Boost Consumption” made early last week.
  • Total Social Financing (TSF) increased by 16% YoY for Jan-Feb to 9.29 trillion RMB. Despite being below the analyst forecasts (which were revised upwards), this is a strong number.
  • Coupled with weaker supply (Post Results FY24: Mine-By-Mine Plan Production + Commentary on Copper From Global Listed Companies ), copper prices can surpass 10k USD/ton in the medium-term. 

The Fed’s Next Move: How Interest Rates Will Make or Break Your Portfolio

By Albert Maass

  • Fed policy choices could create two distinct market paths: a growth-driven rally if rates fall to 2-2.5% or a defensive rotation if rates stay near 5%.
  • Understanding equity as a call option explains why changing interest rates dramatically impacts sector performance and overall market returns.
  • Practical strategies exist for navigating both scenarios, focusing on portfolio positioning that can adapt to either Fed outcome.

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