Smartkarma Daily Briefs, Author at Smartkarma

Sep 24

Daily Brief Health Care: Pine Care Group, Jenscare Scientific, Wuxi Biologics, Tokyo Stock Exchange Tokyo Price Index Topix, SillaJen Inc, Lepu Scientech Medical Technology (Shanghai) and more

By Smartkarma Daily Briefs | Daily Briefs, Healthcare

In today’s briefing:

Pine Care Group (1989 HK): Chinachem Takeover Offers a Good Exit Opportunity for Investors
Jenscare (健世科技) IPO: Candidate for Shorts
Shanghai/Shenzhen Southbound Connect: Weekly Moves (23 September 2022)
Shareholder Returns Offered by Companies that Do Not Meet Prime Market Listing Criteria Are…..
SillaJen Inc (215600 KS): Baselia Deal Enriches Pipeline; Stock Trading Resumption Decision Soon
Lepu Scientech Medical Technology Pre-IPO Tearsheet

Pine Care Group (1989 HK): Chinachem Takeover Offers a Good Exit Opportunity for Investors

By Tina Banerjee

Hong Kong’s leading property developer, Chinachem Group agreed to acquire a 56.15% stake in Pine Care Group (1989 HK) for HKD451.2 million ($57.5 million) from its controlling shareholders.
Post-Acquisition, Chinachem will launch an unconditional mandatory offer for the remaining shares, which it does not hold at HKD0.89 per share, same as the purchase price.
Considering delisting risk, limited upside potential of the shares after a huge run-up, and muted growth outlook of the company, investors should tender their holdings.

Jenscare (健世科技) IPO: Candidate for Shorts

By Ke Yan, CFA, FRM

Jenscare is a China-based medical device company with a focus on structural heart disease. The company launched a deal to raise up to USD 30m via a Hong Kong listing.
In our previous note, we looked at the company’s product lines and provided a brief overview on the company’s valuation.
In this note, we provide an update for the book building. We provide our quick thoughts on the valuation and deal dynamics.

Shanghai/Shenzhen Southbound Connect: Weekly Moves (23 September 2022)

By David Blennerhassett

Inside is a recap of movements in the last week relating to the Shanghai and Shenzhen-Hong Kong Stock Connect facilities, broken down by company and industry.
Overall, the net inflow over the past week was ~US$1.1bn, split (+US$0.8bn) for Shanghai and (+US$0.3bn) for Shenzhen.
The largest inflows were into Wuxi Biologics (2269 HK) and Tencent (700 HK). The largest outflows were in Geely Auto (175 HK) and HKEX (388 HK).

Shareholder Returns Offered by Companies that Do Not Meet Prime Market Listing Criteria Are…..

By Aki Matsumoto

The current criteria of 10 billion-yen in tradable market capitalization is too small by definition of prime market, “market-cap suitable for institutional investors,” and should be reviewed in near future.
It’s natural that there will be difference in the stock prices of companies that can show results that are in line with their disclosed plans and those that are not.
Simply raising shareholder returns won’t, in theory, positively impact on stock price. Mere increased shareholder returns would be seen as sign that the company reached the end of its rope.

SillaJen Inc (215600 KS): Baselia Deal Enriches Pipeline; Stock Trading Resumption Decision Soon

By Tina Banerjee

SillaJen Inc (215600 KS) has developed a differentiated pipeline of oncolytic vaccinia immunotherapy. Its lead drug candidate Pexa-Vec is in phase 2 clinical trial for renal cell carcinoma.
SillaJen has acquired a first-in-class anti-cancer drug candidate BAL0891 from Basilea for upfront payment of $14 million. The company’s cash position is capable to fund the acquisition and R&D expenses.
Korean Stock Exchange is expected to announce its decision on SillaJen stock trading resumption by October 12.

Lepu Scientech Medical Technology Pre-IPO Tearsheet

By Ethan Aw

Lepu Scientech Medical Technology (Shanghai) (LSM HK) is looking to raise at least US$100m in its upcoming Hong Kong IPO. The deal will be run by CICC.
Lepu Scientech Medical Technology (LSMT) is an interventional medical device provider in China for congential heart disease (CHD).
It is the largest manufacturer of CHD occluder products and related procedural accessories in China, according to Frost & Sullivan.

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Sep 24

Most Read: LG Energy Solution, Chubu Steel Plate, ioneer Ltd, Leapmotor, Hong Kong Hang Seng Index, CALB, Softbank Group, Pine Care Group, Jenscare Scientific and more

By Smartkarma Daily Briefs | Daily Briefs, Most Read

In today’s briefing:

LG Energy Flow Crunch with Additional Passives: K200/MSCI Up-Weight & LIT Inclusion
Chubu Steel Plate (5461) – Unusual TOPIX Inclusion Possibility
S&P/ASX Quiddity Leaderboard Dec 22: Couple of High-Impact Intra-Review Changes Possible
Leapmotor (9863 HK) IPO – Stock Connect & Index Flows Could Provide Some Support
Asia Top Short Update
CALB IPO – Low-End Appears Reasonable but Will Still Need Some Charging Support
Softbank – So The Arm IPO Isn’t Looking All That Hot Then?
Pine Care Group (1989 HK): Chinachem Takeover Offers a Good Exit Opportunity for Investors
Jenscare (健世科技) IPO: Candidate for Shorts
CALB IPO Valuation Analysis

LG Energy Flow Crunch with Additional Passives: K200/MSCI Up-Weight & LIT Inclusion

By Sanghyun Park

LG Energy’s locked shares approach 96-97% of SO. Now, we will see an additional passive flow equivalent to another 1% of SO: KOSPI 200/MSCI Standard up-weights and LIT inclusion.
Each passive impact is also substantial. The MSCI up-weight alone will cause an impact equivalent to 2.44x ADTV. It would be 2.20x for the KOSPI 200 and 1.03x for LIT.
For the KOSPI 200 December review, the event-driven flow will likely focus on up-weights, including LG Energy. For LIT, we should consider an aggressive LONG/SHORT with LG Chem.

Chubu Steel Plate (5461) – Unusual TOPIX Inclusion Possibility

By Travis Lundy

Today, Nagoya Premier-listed Chubu Steel Plate (5461 JP) announced that it had applied today to be listed in Tokyo.
It is one of very few Japan names not listed in Tokyo. A TSE listing examination will be conducted, and there is a possibility it moves to TSE Prime.
There are 6 key segment transfer and listing requirements to gain a listing in TSE Prime. Chubu Steel Plate is really close.

S&P/ASX Quiddity Leaderboard Dec 22: Couple of High-Impact Intra-Review Changes Possible

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.
Tassal (TGR AU) and Nearmap Ltd (NEA AU) could get deleted from ASX200 before the December Rebalance, triggering high-impact intra-review additions. There should be two changes in the Review itself.
Pilbara Minerals (PLS AU) is close to becoming an ASX 50 ADD and Lendlease Group (LLC AU) is close to becoming an ASX 50 DEL in the December 2022 review.

Leapmotor (9863 HK) IPO – Stock Connect & Index Flows Could Provide Some Support

By Brian Freitas

Leapmotor (9863 HK) is looking to raise between US$800m-US$1.03bn by selling 130.82m shares at a price range of HK$48-62/share. Between 30-39% of the shares will be taken by cornerstone investors.
The continued slide in its closest peers could put pressure on the stock post listing, though there could be some passive buying in December.
Leapmotor (9863 HK) could be added to the HSCI and Hang Seng Tech Index (HSTECH INDEX) in December. Stock Connect could come online in December too.

Asia Top Short Update

By Thomas Schroeder

Our top short bets in Asia (HSI, Taiwan, Korea) show risk of breaking to new lows. The RTY breaks gives the bear trade another leg down.
Our relative perform longs (STI and SET 50) are due to drift to support but holding up well. USD is breaking to new highs with momentum.
Asian markets that have held up are now at risk of late-stage capitulation – ASX, Nifty and NKY.

CALB IPO – Low-End Appears Reasonable but Will Still Need Some Charging Support

By Sumeet Singh

CALB aims to raise up to US$1.7bn in its Hong Kong IPO.
CALB undertakes design, R&D, production and sales of EV batteries and Energy Storage Systems (ESS) products.
In this note, we will run the deal through our ECM framework and talk about IPO pricing.

Softbank – So The Arm IPO Isn’t Looking All That Hot Then?

By Mio Kato

Apparently prospects for a high valuation on a potential Arm IPO are so staggeringly, AI-rifically good that Masayoshi Son is now sounding out Samsung on a strategic partnership.
Samsung itself has not been having the greatest time of late with Micron and SK Hynix making serious inroads against its prior technological leadership in memory.
So as desperate and desperate-er ponder an alliance we can only be thoroughly convinced that this move absolutely, positively has nooooothing to do with trying to prop up share prices.

Pine Care Group (1989 HK): Chinachem Takeover Offers a Good Exit Opportunity for Investors

By Tina Banerjee

Hong Kong’s leading property developer, Chinachem Group agreed to acquire a 56.15% stake in Pine Care Group (1989 HK) for HKD451.2 million ($57.5 million) from its controlling shareholders.
Post-Acquisition, Chinachem will launch an unconditional mandatory offer for the remaining shares, which it does not hold at HKD0.89 per share, same as the purchase price.
Considering delisting risk, limited upside potential of the shares after a huge run-up, and muted growth outlook of the company, investors should tender their holdings.

Jenscare (健世科技) IPO: Candidate for Shorts

By Ke Yan, CFA, FRM

Jenscare is a China-based medical device company with a focus on structural heart disease. The company launched a deal to raise up to USD 30m via a Hong Kong listing.
In our previous note, we looked at the company’s product lines and provided a brief overview on the company’s valuation.
In this note, we provide an update for the book building. We provide our quick thoughts on the valuation and deal dynamics.

CALB IPO Valuation Analysis

By Douglas Kim

CALB (3931 HK) is getting ready to complete its IPO in early October in Hong Kong. The IPO price range is between HK$38 and HK$51 per share.
Based on our valuation sensitivity analysis, our base case valuation of CALB is HK$53 per share, which is 20% higher than the mid-point of the IPO price range.
CALB has a rare combination of surging sales growth rate, operating profitability, and increasing market share in the EV battery market globally.

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Sep 24

Daily Brief ECM: CALB IPO – Low-End Appears Reasonable but Will Still Need Some Charging Support and more

By Smartkarma Daily Briefs | Daily Briefs, ECM

In today’s briefing:

CALB IPO – Low-End Appears Reasonable but Will Still Need Some Charging Support
Jenscare (健世科技) IPO: Candidate for Shorts
CALB IPO Valuation Analysis
Fiserv Inc: Initiation of Coverage – Portfolio Expansion & Other Key Drivers
Lepu Scientech Medical Technology Pre-IPO Tearsheet
Amkor Technology Inc.: Initiation of Coverage – Financial Forecasts
PTC Inc.: Initiation of Coverage – The Intland Software Acquisition & Other Drivers
Nutanix Inc.: Initiation of Coverage – Financial Forecasts
ON Semiconductor Corporation- Initiation of Coverage – Capacity Expansion & Other Drivers
Sonos Inc.: Initiation of Coverage – Sonos Voice Control & Other Key Product Drivers

CALB IPO – Low-End Appears Reasonable but Will Still Need Some Charging Support

By Sumeet Singh

CALB aims to raise up to US$1.7bn in its Hong Kong IPO.
CALB undertakes design, R&D, production and sales of EV batteries and Energy Storage Systems (ESS) products.
In this note, we will run the deal through our ECM framework and talk about IPO pricing.

Jenscare (健世科技) IPO: Candidate for Shorts

By Ke Yan, CFA, FRM

Jenscare is a China-based medical device company with a focus on structural heart disease. The company launched a deal to raise up to USD 30m via a Hong Kong listing.
In our previous note, we looked at the company’s product lines and provided a brief overview on the company’s valuation.
In this note, we provide an update for the book building. We provide our quick thoughts on the valuation and deal dynamics.

CALB IPO Valuation Analysis

By Douglas Kim

CALB (3931 HK) is getting ready to complete its IPO in early October in Hong Kong. The IPO price range is between HK$38 and HK$51 per share.
Based on our valuation sensitivity analysis, our base case valuation of CALB is HK$53 per share, which is 20% higher than the mid-point of the IPO price range.
CALB has a rare combination of surging sales growth rate, operating profitability, and increasing market share in the EV battery market globally.

Fiserv Inc: Initiation of Coverage – Portfolio Expansion & Other Key Drivers

By Baptista Research

This is our first report on Fiserv, a major global provider of fintech solutions related to payments, account processing, e-commerce, digital banking solutions, card issuer processing, and cloud-based Point-of-Sale solutions.
The company delivered a strong quarterly result, surpassing Wall Street expectations on all counts with a strong organic revenue growth.
The global active merchants’ accounts of the company grew.

Lepu Scientech Medical Technology Pre-IPO Tearsheet

By Ethan Aw

Lepu Scientech Medical Technology (Shanghai) (LSM HK) is looking to raise at least US$100m in its upcoming Hong Kong IPO. The deal will be run by CICC.
Lepu Scientech Medical Technology (LSMT) is an interventional medical device provider in China for congential heart disease (CHD).
It is the largest manufacturer of CHD occluder products and related procedural accessories in China, according to Frost & Sullivan.

Amkor Technology Inc.: Initiation of Coverage – Financial Forecasts

By Baptista Research

This is our first report on Amkor, a medium-sized provider of provider of outsourced semiconductor packaging and test services.
Although the market is experiencing macroeconomic challenges, demand for their services, particularly advanced packaging, is still strong.
The automotive semiconductor market is predicted to develop faster than the entire sector.

PTC Inc.: Initiation of Coverage – The Intland Software Acquisition & Other Drivers

By Baptista Research

This is our first report on PTC, an emerging software player in the computer-aided design (CAD), product lifecycle management (PLM), application lifecycle management (ALM), and service lifecycle management (SLM) space.
The company had a rough third quarter and delivered a significantly below par result in terms of both, revenues and earnings.
Its Windchill+ is still in the early stages of the SaaS transformation which was a slowing factor though PTC had a decent SaaS quarter for Windchill, thanks mostly to a decent mix of SaaS in new projects.

Nutanix Inc.: Initiation of Coverage – Financial Forecasts

By Baptista Research

This is our first report on enterprise cloud platform provider, Nutanix.
The company’s Nutanix Cloud Platform users increased their use of it in the fourth quarter and expanded their adoption of related solutions in fields like storage, Database as a Service, and cloud management.
In contrast, they are standardizing Nutanix database service for maintaining and deploying their databases throughout their enterprise.

ON Semiconductor Corporation- Initiation of Coverage – Capacity Expansion & Other Drivers

By Baptista Research

This is our first report on ON Semiconductor Corporation, a well-known provider of intelligent sensing and power solutions.
The management has streamlined their product line by eliminating price-sensitive products in favour of fiercely competitive Intelligent Power and Sensing Solutions.
Because of the solutions’ strong performance, the depth of their intelligent power and sensor portfolio, and end-to-end manufacturing capabilities, their clients select ON Semiconductors as a strategic partner to support their long-term technology roadmaps.

Sonos Inc.: Initiation of Coverage – Sonos Voice Control & Other Key Product Drivers

By Baptista Research

This is our first report on Sonos, the multi-room audio products major.
The macroeconomic environment has grown significantly more hostile for Sonos off late after it enjoyed a decent phase during the pandemic.
Despite the uncertain environment, Sonos has a strong brand identity, a dependable and devoted premium client, and a sizable and expanding market opportunity.

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Sep 24

Daily Brief ESG: ESG Analysis of Korea’s Sole Electricity Supplier: Korea Electric Power Corporation (KEPCO 015760) and more

By Smartkarma Daily Briefs | Daily Briefs, ESG

In today’s briefing:

ESG Analysis of Korea’s Sole Electricity Supplier: Korea Electric Power Corporation (KEPCO 015760)
Shareholder Returns Offered by Companies that Do Not Meet Prime Market Listing Criteria Are…..

ESG Analysis of Korea’s Sole Electricity Supplier: Korea Electric Power Corporation (KEPCO 015760)

By Ju Yeon Lee

Environmental: KEPCO’s power transmission tower construction is destroying ecosystems and posing a climate risk in various areas, which is also why the coal mine development project in Australia was suspended.
Social : 58% of KEPCO’s suppliers were found to be illegal subcontractors leading to controversy over work environment issues. Also, the construction of power transmission towers sparked serious community conflicts.
Governance : Despite KEPCO’s large deficit, the company’s moral risk and poor risk management issues, such as corruption and excessive wages of employers, continue to surface.

Shareholder Returns Offered by Companies that Do Not Meet Prime Market Listing Criteria Are…..

By Aki Matsumoto

The current criteria of 10 billion-yen in tradable market capitalization is too small by definition of prime market, “market-cap suitable for institutional investors,” and should be reviewed in near future.
It’s natural that there will be difference in the stock prices of companies that can show results that are in line with their disclosed plans and those that are not.
Simply raising shareholder returns won’t, in theory, positively impact on stock price. Mere increased shareholder returns would be seen as sign that the company reached the end of its rope.

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✓ Company Data and News
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Sep 24

Daily Brief India: Bandhan Bank Ltd, On Semiconductor, Road King Infrastructure, Sonos Inc and more

By Smartkarma Daily Briefs | Daily Briefs, India

In today’s briefing:

Bandhan Bank Ltd (BANDHAN IN) | Still Waters, but May Not Run Deep
ON Semiconductor Corporation- Initiation of Coverage – Capacity Expansion & Other Drivers
Weekly Wrap – 23 Sep 2022
Sonos Inc.: Initiation of Coverage – Sonos Voice Control & Other Key Product Drivers

Bandhan Bank Ltd (BANDHAN IN) | Still Waters, but May Not Run Deep

By Pranav Bhavsar

Over the last 6M, Bandhan Bank Ltd (BANDHAN IN) has underperformed the Nifty 50 by ~7.3% (BANDHAN -5.92% vs Nifty +1.39%)
Our flash checks across West Bengal and Assam indicate a stable to improving business environment.
We reiterate our view of that the asset quality downcycle could be on the verge of ending. Additional provisioning requirements should be sharply lower from Q3 FY23.

ON Semiconductor Corporation- Initiation of Coverage – Capacity Expansion & Other Drivers

By Baptista Research

This is our first report on ON Semiconductor Corporation, a well-known provider of intelligent sensing and power solutions.
The management has streamlined their product line by eliminating price-sensitive products in favour of fiercely competitive Intelligent Power and Sensing Solutions.
Because of the solutions’ strong performance, the depth of their intelligent power and sensor portfolio, and end-to-end manufacturing capabilities, their clients select ON Semiconductors as a strategic partner to support their long-term technology roadmaps.

Weekly Wrap – 23 Sep 2022

By Charles Macgregor

Lucror Analytics Weekly Wraps provide an overview of all Morning Views comments and reports published by our analyst team in the past week, and also showcase a list of the most-read reports.

In this Insight:

and more…

Sonos Inc.: Initiation of Coverage – Sonos Voice Control & Other Key Product Drivers

By Baptista Research

This is our first report on Sonos, the multi-room audio products major.
The macroeconomic environment has grown significantly more hostile for Sonos off late after it enjoyed a decent phase during the pandemic.
Despite the uncertain environment, Sonos has a strong brand identity, a dependable and devoted premium client, and a sizable and expanding market opportunity.

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Sep 24

Daily Brief South Korea: Korea Electric Power, Hanwha Solutions, SillaJen Inc and more

By Smartkarma Daily Briefs | Daily Briefs, South Korea

In today’s briefing:

ESG Analysis of Korea’s Sole Electricity Supplier: Korea Electric Power Corporation (KEPCO 015760)
A Detailed Summary of Hanwha Solutions Demerger & Tender Offer
SillaJen Inc (215600 KS): Baselia Deal Enriches Pipeline; Stock Trading Resumption Decision Soon

ESG Analysis of Korea’s Sole Electricity Supplier: Korea Electric Power Corporation (KEPCO 015760)

By Ju Yeon Lee

Environmental: KEPCO’s power transmission tower construction is destroying ecosystems and posing a climate risk in various areas, which is also why the coal mine development project in Australia was suspended.
Social : 58% of KEPCO’s suppliers were found to be illegal subcontractors leading to controversy over work environment issues. Also, the construction of power transmission towers sparked serious community conflicts.
Governance : Despite KEPCO’s large deficit, the company’s moral risk and poor risk management issues, such as corruption and excessive wages of employers, continue to surface.

A Detailed Summary of Hanwha Solutions Demerger & Tender Offer

By Sanghyun Park

There is no unlocking of treasury shares, so a flow betting on dramatic value accretion will not occur. For tendering, the proration risk appears to be relatively high.
Passive trackers will sell at the close on February 24 and repurchase (likely only for Solutions) at the close on March 31. The flow size would be around 5.5x ADTV.
ECO risk wouldn’t be a concern as the new rule will grant appraisal/preemptive rights to the existing shareholders. Also, Hanwha hinted at the possibility of choosing private placement over ECO.

SillaJen Inc (215600 KS): Baselia Deal Enriches Pipeline; Stock Trading Resumption Decision Soon

By Tina Banerjee

SillaJen Inc (215600 KS) has developed a differentiated pipeline of oncolytic vaccinia immunotherapy. Its lead drug candidate Pexa-Vec is in phase 2 clinical trial for renal cell carcinoma.
SillaJen has acquired a first-in-class anti-cancer drug candidate BAL0891 from Basilea for upfront payment of $14 million. The company’s cash position is capable to fund the acquisition and R&D expenses.
Korean Stock Exchange is expected to announce its decision on SillaJen stock trading resumption by October 12.

💡 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
✓ Events & Webinars

Sep 24

Daily Brief United States: NVIDIA Corp, Fiserv Inc, PTC Inc, Marriott International, Amkor Technology, Nutanix Inc, On Semiconductor, PagerDuty Inc and more

By Smartkarma Daily Briefs | Daily Briefs, United States

In today’s briefing:

Breaking Growth Short Candidates: Outset Med., NVIDIA, Intuitive Surgical, Plug Power
Fiserv Inc: Detailed Credit Analysis & Financial Strength Evaluation Report, Key Risks (09/2022)
Fiserv Inc: Initiation of Coverage – Portfolio Expansion & Other Key Drivers
PTC Inc.: Detailed Credit Analysis & Financial Strength Evaluation Report, Key Risks (09/2022)
Marriott Hotels: Detailed Credit Analysis & Financial Strength Evaluation Report
Amkor Technology Inc.: Initiation of Coverage – Financial Forecasts
Nutanix Inc.: Initiation of Coverage – Financial Forecasts
ON Semiconductor Corporation- Initiation of Coverage – Capacity Expansion & Other Drivers
PTC Inc.: Initiation of Coverage – The Intland Software Acquisition & Other Drivers
PagerDuty Inc.: Initiation of Coverage – PagerDuty Operations Cloud & Other Drivers

Breaking Growth Short Candidates: Outset Med., NVIDIA, Intuitive Surgical, Plug Power

By Eric Fernandez, CFA

This model looks for slowing growth, margin declines, sales and/or earnings disappointments, troubling working capital trends, poor estimate trends or lowered guidance, among other characteristics.
The key judgement is whether a slowdown is temporary or the beginning of a trend. These shorts tend to have high valuations and betas. Multiple compression accelerates the stock’s decline.
Today we are flagging Outset Med., NVIDIA, Intuitive Surgical, Plug Power

Fiserv Inc: Detailed Credit Analysis & Financial Strength Evaluation Report, Key Risks (09/2022)

By Baptista Research

Fiserv is a major global provider of fintech solutions related to payments, account processing, e-commerce, digital banking solutions, card issuer processing, and cloud-based Point-of-Sale solutions.
Some recent client wins include Wawa, a large chain of gas stations and convenience stores, Indian Oil Corporation, and, Great Southern Bank.
The company is transforming from selling merchants’ solutions for individual points to offering operating systems: Carat for large enterprises and Clover for medium and small-sized merchants.

Fiserv Inc: Initiation of Coverage – Portfolio Expansion & Other Key Drivers

By Baptista Research

This is our first report on Fiserv, a major global provider of fintech solutions related to payments, account processing, e-commerce, digital banking solutions, card issuer processing, and cloud-based Point-of-Sale solutions.
The company delivered a strong quarterly result, surpassing Wall Street expectations on all counts with a strong organic revenue growth.
The global active merchants’ accounts of the company grew.

PTC Inc.: Detailed Credit Analysis & Financial Strength Evaluation Report, Key Risks (09/2022)

By Baptista Research

PTC is an emerging software company that operates in the rather competitive domains of computer-aided design (CAD), product lifecycle management (PLM), application lifecycle management (ALM), and service lifecycle management (SLM).
The company had a rough third quarter and delivered a significantly below par result in terms of both, revenues and earnings.
Its Windchill+ is still in the early stages of the SaaS transformation which was a slowing factor though PTC had a decent SaaS quarter for Windchill, thanks mostly to a decent mix of SaaS in new projects.

Marriott Hotels: Detailed Credit Analysis & Financial Strength Evaluation Report

By Baptista Research

Marriot Hotels has its fair share of underlying risks as it continues its path to recovery after the pandemic.
Cross-border travel has seen a good recovery which is benefitting the company.
We also have a dedicated analysis of the company’s Environmental, Social, and Governance (ESG) risk scores in order to evaluate the sustainability risk.

Amkor Technology Inc.: Initiation of Coverage – Financial Forecasts

By Baptista Research

This is our first report on Amkor, a medium-sized provider of provider of outsourced semiconductor packaging and test services.
Although the market is experiencing macroeconomic challenges, demand for their services, particularly advanced packaging, is still strong.
The automotive semiconductor market is predicted to develop faster than the entire sector.

Nutanix Inc.: Initiation of Coverage – Financial Forecasts

By Baptista Research

This is our first report on enterprise cloud platform provider, Nutanix.
The company’s Nutanix Cloud Platform users increased their use of it in the fourth quarter and expanded their adoption of related solutions in fields like storage, Database as a Service, and cloud management.
In contrast, they are standardizing Nutanix database service for maintaining and deploying their databases throughout their enterprise.

ON Semiconductor Corporation- Initiation of Coverage – Capacity Expansion & Other Drivers

By Baptista Research

This is our first report on ON Semiconductor Corporation, a well-known provider of intelligent sensing and power solutions.
The management has streamlined their product line by eliminating price-sensitive products in favour of fiercely competitive Intelligent Power and Sensing Solutions.
Because of the solutions’ strong performance, the depth of their intelligent power and sensor portfolio, and end-to-end manufacturing capabilities, their clients select ON Semiconductors as a strategic partner to support their long-term technology roadmaps.

PTC Inc.: Initiation of Coverage – The Intland Software Acquisition & Other Drivers

By Baptista Research

This is our first report on PTC, an emerging software player in the computer-aided design (CAD), product lifecycle management (PLM), application lifecycle management (ALM), and service lifecycle management (SLM) space.
The company had a rough third quarter and delivered a significantly below par result in terms of both, revenues and earnings.
Its Windchill+ is still in the early stages of the SaaS transformation which was a slowing factor though PTC had a decent SaaS quarter for Windchill, thanks mostly to a decent mix of SaaS in new projects.

PagerDuty Inc.: Initiation of Coverage – PagerDuty Operations Cloud & Other Drivers

By Baptista Research

This is our first report on PagerDuty, a well-known international digital operations management platform.
The company’s Operations Cloud is a critical infrastructure that enables developers to balance these requirements when its customers must guarantee smooth digital experiences while increasing operating efficiency.
In support of their corporate objectives, their platform helps them advance faster towards greater digital maturity.

💡 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

Sep 24

Daily Brief Equity Bottom-Up: Pine Care Group (1989 HK): Chinachem Takeover Offers a Good Exit Opportunity for Investors and more

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

In today’s briefing:

Pine Care Group (1989 HK): Chinachem Takeover Offers a Good Exit Opportunity for Investors
Breaking Growth Short Candidates: Outset Med., NVIDIA, Intuitive Surgical, Plug Power
Bandhan Bank Ltd (BANDHAN IN) | Still Waters, but May Not Run Deep
Astra International (ASII IJ) – Autos and Commodities Driving Growth
SillaJen Inc (215600 KS): Baselia Deal Enriches Pipeline; Stock Trading Resumption Decision Soon
Hamamatsu Photonics (6965 JP): Difficult Year Ahead
HWKN: Pricing the Expected

Pine Care Group (1989 HK): Chinachem Takeover Offers a Good Exit Opportunity for Investors

By Tina Banerjee

Hong Kong’s leading property developer, Chinachem Group agreed to acquire a 56.15% stake in Pine Care Group (1989 HK) for HKD451.2 million ($57.5 million) from its controlling shareholders.
Post-Acquisition, Chinachem will launch an unconditional mandatory offer for the remaining shares, which it does not hold at HKD0.89 per share, same as the purchase price.
Considering delisting risk, limited upside potential of the shares after a huge run-up, and muted growth outlook of the company, investors should tender their holdings.

Breaking Growth Short Candidates: Outset Med., NVIDIA, Intuitive Surgical, Plug Power

By Eric Fernandez, CFA

This model looks for slowing growth, margin declines, sales and/or earnings disappointments, troubling working capital trends, poor estimate trends or lowered guidance, among other characteristics.
The key judgement is whether a slowdown is temporary or the beginning of a trend. These shorts tend to have high valuations and betas. Multiple compression accelerates the stock’s decline.
Today we are flagging Outset Med., NVIDIA, Intuitive Surgical, Plug Power

Bandhan Bank Ltd (BANDHAN IN) | Still Waters, but May Not Run Deep

By Pranav Bhavsar

Over the last 6M, Bandhan Bank Ltd (BANDHAN IN) has underperformed the Nifty 50 by ~7.3% (BANDHAN -5.92% vs Nifty +1.39%)
Our flash checks across West Bengal and Assam indicate a stable to improving business environment.
We reiterate our view of that the asset quality downcycle could be on the verge of ending. Additional provisioning requirements should be sharply lower from Q3 FY23.

Astra International (ASII IJ) – Autos and Commodities Driving Growth

By Angus Mackintosh

Astra International just held its public expose at which the company reiterated the strong performance in 1H2022 driven by automotive, finance, heavy equipment and commodity-related businesses.
The momentum will continue into 2H2022 and car sales continue to show strong growth, with the tailwind of higher commodity prices and increased mobility.
Astra International remains one of our top picks in Indonesia for the ongoing recovery in an environment where commodity prices remain high. Valuations are attractive versus history.

SillaJen Inc (215600 KS): Baselia Deal Enriches Pipeline; Stock Trading Resumption Decision Soon

By Tina Banerjee

SillaJen Inc (215600 KS) has developed a differentiated pipeline of oncolytic vaccinia immunotherapy. Its lead drug candidate Pexa-Vec is in phase 2 clinical trial for renal cell carcinoma.
SillaJen has acquired a first-in-class anti-cancer drug candidate BAL0891 from Basilea for upfront payment of $14 million. The company’s cash position is capable to fund the acquisition and R&D expenses.
Korean Stock Exchange is expected to announce its decision on SillaJen stock trading resumption by October 12.

Hamamatsu Photonics (6965 JP): Difficult Year Ahead

By Scott Foster

FY Sep-22 results are likely to beat management’s guidance, but this should be in the price. Recession and rising interest rates are probably not in the price.
Growth rates slowed in 3Q and are likely to decline further in 4Q. In the year ahead, we expect both sales and profits to decline.
The shares have rebounded by 21% since the 1st of July to 30x our EPS estimate for FY Sep-23. This does not look sustainable. Sell into current strength.

HWKN: Pricing the Expected

By Hamed Khorsand

The seasonal strength of the water treatment business should lead to Hawkins (HWKN) offsetting the sales decline from industrial specialty chemicals declining in price in the September quarter
There is now evidence some specialty chemical prices are beginning to decline. When there has been no LIFO charge, HWKN has reported gross margin above 20 percent.
Summer months are seasonally the time when there is greater demand from HWKN’s water treatment customers. Over the course of the past year HWKN has grown the segment through acquisitions

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Sep 24

Daily Brief Event-Driven: Leapmotor (9863 HK) IPO – Stock Connect & Index Flows Could Provide Some Support and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

Leapmotor (9863 HK) IPO – Stock Connect & Index Flows Could Provide Some Support
Softbank – So The Arm IPO Isn’t Looking All That Hot Then?
Shanghai/Shenzhen Northbound Connect: Weekly Moves (22 September 2022)
Shanghai/Shenzhen Southbound Connect: Weekly Moves (23 September 2022)
A Detailed Summary of Hanwha Solutions Demerger & Tender Offer
Porsche AG: IPO Set for Success
Itausa (ITSA4 BZ); Attractive NAV Discount, Dividend Yield & Portfolio Diversification Are Positives

Leapmotor (9863 HK) IPO – Stock Connect & Index Flows Could Provide Some Support

By Brian Freitas

Leapmotor (9863 HK) is looking to raise between US$800m-US$1.03bn by selling 130.82m shares at a price range of HK$48-62/share. Between 30-39% of the shares will be taken by cornerstone investors.
The continued slide in its closest peers could put pressure on the stock post listing, though there could be some passive buying in December.
Leapmotor (9863 HK) could be added to the HSCI and Hang Seng Tech Index (HSTECH INDEX) in December. Stock Connect could come online in December too.

Softbank – So The Arm IPO Isn’t Looking All That Hot Then?

By Mio Kato

Apparently prospects for a high valuation on a potential Arm IPO are so staggeringly, AI-rifically good that Masayoshi Son is now sounding out Samsung on a strategic partnership.
Samsung itself has not been having the greatest time of late with Micron and SK Hynix making serious inroads against its prior technological leadership in memory.
So as desperate and desperate-er ponder an alliance we can only be thoroughly convinced that this move absolutely, positively has nooooothing to do with trying to prop up share prices.

Shanghai/Shenzhen Northbound Connect: Weekly Moves (22 September 2022)

By David Blennerhassett

Inside is a recap of movements in the last week relating to the Hong Kong Stock Exchange -Shanghai and Shenzhen Northbound Connect facilities, broken down by company and industry.
Overall, net outflow over the past week was ~US$1.4bn, split between Shanghai (-US$0.8bn) and Shenzhen (-US$0.6bn).
The largest inflows were into Tianqi Lithium (002466 CH) and Midea Group (000333 CH). The largest outflows were in East Money Information (300059 CH) and Kweichow Moutai (600519 CH).

Shanghai/Shenzhen Southbound Connect: Weekly Moves (23 September 2022)

By David Blennerhassett

Inside is a recap of movements in the last week relating to the Shanghai and Shenzhen-Hong Kong Stock Connect facilities, broken down by company and industry.
Overall, the net inflow over the past week was ~US$1.1bn, split (+US$0.8bn) for Shanghai and (+US$0.3bn) for Shenzhen.
The largest inflows were into Wuxi Biologics (2269 HK) and Tencent (700 HK). The largest outflows were in Geely Auto (175 HK) and HKEX (388 HK).

A Detailed Summary of Hanwha Solutions Demerger & Tender Offer

By Sanghyun Park

There is no unlocking of treasury shares, so a flow betting on dramatic value accretion will not occur. For tendering, the proration risk appears to be relatively high.
Passive trackers will sell at the close on February 24 and repurchase (likely only for Solutions) at the close on March 31. The flow size would be around 5.5x ADTV.
ECO risk wouldn’t be a concern as the new rule will grant appraisal/preemptive rights to the existing shareholders. Also, Hanwha hinted at the possibility of choosing private placement over ECO.

Porsche AG: IPO Set for Success

By Jesus Rodriguez Aguilar

Volkswagen sets the price range for the Porsche AG IPO between €76.50 and €82.50. The books are covered several times. Porsche AG will begin trading on September 29.
Through a holding chain, the Pïech and Porsche families will control 25% of the votes of Porsche AG directly and 39.975% indirectly (total of 64.975%), with just a 24.275% economic interest.
The IPO looks set for success, with possible DAX inclusion, and pricing likely towards the top-end. This should favour Volkswagen’s re-rating and tighten the discount to NAV of Porsche SE.

Itausa (ITSA4 BZ); Attractive NAV Discount, Dividend Yield & Portfolio Diversification Are Positives

By Victor Galliano

Itausa has acquired a 10.3% stake in toll road company CCR, in a diversification move away from its core financials holdings; yet financials still account for 90%+ of holdings value
Itausa’s stated NAV discount is over 26%, and we believe this discount is slightly under-estimated; Itausa’s indirect XP stake adds to the NAV, implying a discount of close to 28%
Reinvesting the proceeds of XP disposals in CCR makes good diversification sense; aside from the historically high NAV discount, Itausa has an attractive LTM dividend yield of over 5%

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Sep 24

Daily Brief Indonesia: Astra International and more

By Smartkarma Daily Briefs | Daily Briefs, Indonesia

In today’s briefing:

Astra International (ASII IJ) – Autos and Commodities Driving Growth

Astra International (ASII IJ) – Autos and Commodities Driving Growth

By Angus Mackintosh

Astra International just held its public expose at which the company reiterated the strong performance in 1H2022 driven by automotive, finance, heavy equipment and commodity-related businesses.
The momentum will continue into 2H2022 and car sales continue to show strong growth, with the tailwind of higher commodity prices and increased mobility.
Astra International remains one of our top picks in Indonesia for the ongoing recovery in an environment where commodity prices remain high. Valuations are attractive versus history.

💡 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

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