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Smartkarma Daily Briefs

Sep 12
0

Daily Brief Health Care: Incannex Healthcare, Innovex Medical and more

By | Daily Briefs, Healthcare

In today’s briefing:

  • Incannex Healthcare (IHL AU): Attractive Idea Backed by Niche Focus on Cannabinoid Pharmaceuticals
  • Pre-IPO Innovex Medical – A Comprehensive Product Portfolio Underpins Future Growth Prospects

Incannex Healthcare (IHL AU): Attractive Idea Backed by Niche Focus on Cannabinoid Pharmaceuticals

By Tina Banerjee

  • Incannex Healthcare (IHL AU) has a differentiated product portfolio, addressing unmet global medical needs. With cash balance of A$37.5 million, Incannex is well-resourced to fund its activities for ~2.5 years.
  • Recently completed acquisition of APIRx Pharmaceuticals has strategically expanded intellectual property portfolio to 28 clinical programs, the world’s largest portfolio of patented medicinal cannabinoid drug formulations and psychedelic treatment protocols.
  • The combined annual global market size of the targeted indications is over $420 billion. The company’s strategy of combining cannabinoids with FDA-approved generic drugs calls for shorter regulatory pathway.

Pre-IPO Innovex Medical – A Comprehensive Product Portfolio Underpins Future Growth Prospects

By Xinyao (Criss) Wang

  • As one of the few companies in the world that could provide one-stop solutions including all major medical devices used in non-vascular interventional surgery, Innovex’s outlook is promising.
  • About 30% overseas revenue indicates that the Company’s internationalization is on track, which could help to “hedge” negative domestic policy risks.
  • In terms of the valuation, Innovex’s valuation should be higher than Scivita but lower than Aohua. However, Innovex has the potential to surpass Aohua in the future.

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Sep 12
0

Daily Brief Consumer: Samsung Kodex Autos ETF, Nikon Corp and more

By | Consumer, Daily Briefs

In today’s briefing:

  • Backtesting Implications: Korea Sector ETFs Rebalancing on the 8th
  • Nikon (7731) | Snapping up a 3D Printing World Leader

Backtesting Implications: Korea Sector ETFs Rebalancing on the 8th

By Sanghyun Park

  • Compared to the tightly crowded KOSPI 200, the sector ETFs’ rebalancing flow trading appears relatively less crowded, which led to a significantly higher flow/price correlation on the rebalancing day.
  • The KRX now delivers the rebalancing results of the KRX Sector & K-New Deal Indexes only to paying customers. This can increase the profit effect of acquiring prior information.
  • So, safe play, which builds up a position from the time this information is acquired, rather than an aggressive preemptive position build-up, can still obtain a sufficient level of juice.

Nikon (7731) | Snapping up a 3D Printing World Leader

By Mark Chadwick

  • We believe the market may have missed the important acquisition of 3D printing firm, SLM Solutions
  • The 3D printing market is expected to grow rapidly driven by industrial applications that require accurate products and rapid time to market
  • We believe the acquisition is a good fit for Nikon and that the realization of synergies could see SLM making a meaningful profit contribution

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Sep 12
0

Daily Brief Financials: Dollar Index, China SCE and more

By | Daily Briefs, Financials

In today’s briefing:

  • USD Top Zone to Lead Risk Turn
  • Morning Views Asia: China SCE, Yuexiu Property

USD Top Zone to Lead Risk Turn

By Thomas Schroeder

  • USD dip/rise into overshoot zone as the green back begins to feel out a topping zone. The dollar typically tops a few weeks ahead of and equity troughing cycle.
  • DXY met our 110.50-111 tactical top target where we reduced overdone USD longs and placed a short bet (AUD and SGD) for a dip/rally.
  • Expect USD splinters to appear in coming weeks as the DXY top near the 111.25 projection if we hold 107.50 now.

Morning Views Asia: China SCE, Yuexiu Property

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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Sep 12
0

Daily Brief Quantitative Analysis: A-H Premium Weekly (Sep 9th): Huadian and more

By | Daily Briefs, Quantitative Analysis

In today’s briefing:

  • A-H Premium Weekly (Sep 9th): Huadian, CGN Power, GWM
  • Hong Kong Connect Flows (Sep 9th): Tencent, BYD, Sensetime, Meituan
  • Northbound Flows (Sep 9th): Longi Green, Zijin, Aier Eye, Moutai, CMB, Tongwei, Luxshare

A-H Premium Weekly (Sep 9th): Huadian, CGN Power, GWM

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 118.5% as of Sep 9th.
  • The average A-H premium changed by 1.3ppt week-on-week, led by utilities, consumer staples, financials and offset by health Care, consumer discretionary, communication services. 
  • We highlight weekly changes in A-H premium for Huadian, CGN Power, GWM, Tigermed, Angang, CIMC, Zoomlion, Tianqi Lithium, CIMC Vehicles, CNOOC.

Hong Kong Connect Flows (Sep 9th): Tencent, BYD, Sensetime, Meituan

By Ke Yan, CFA, FRM

  • We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of September 9th.
  • The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.
  • We highlight inflows into Tencent, BYD, Sensetime and outflows from Meituan.

Northbound Flows (Sep 9th): Longi Green, Zijin, Aier Eye, Moutai, CMB, Tongwei, Luxshare

By Ke Yan, CFA, FRM

  • We analyze the weekly Shanghai/Shenzhen northbound Connect flows with our data engine for holding position as of September 9th.
  • We estimate the weekly outflows to be US$32.0 million, led by consumer staples, information technology, and offset by materials, health care, financials.
  • We highlight inflows into Longi Green, Zijin, Aier Eye, and outflows from Moutai, CMB, Tongwei, Luxshare. 

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Sep 12
0

Daily Brief Thematic (Sector/Industry): Weekly Stock Bullfinder – Week of 9/12 and more

By | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

  • Weekly Stock Bullfinder – Week of 9/12

Weekly Stock Bullfinder – Week of 9/12

By Weekly Stock Bull Finder

  • One theme going into 2022 was the expectation by many market participants that China COVID-19 cases would slow and lockdowns would be discontinued which would allow China’s economy to reopen and participate in the post-COVID global recovery.
  • However, despite sitting here in September 2022, China’s “COVID zero” policy has continued and has baffled outside observers who have been attempting to understand why such harsh policies continue to exist.
  • There have been shifting ideas of whether a reversal of China’s COVID zero policy would occur leading up to or after China’s National People’s Congress beginning October 16th where Xi Jinping is expected to secure a third term as China’s leader.

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Sep 12
0

Daily Brief ECM: ECM Weekly (12th Sep 2022) – Onewo and more

By | Daily Briefs, ECM

In today’s briefing:

  • ECM Weekly (12th Sep 2022) – Onewo, CALB, YSB, Medanta, Beneunder, JMDC, SH Holdings, Indigo
  • Pre-IPO Innovex Medical – A Comprehensive Product Portfolio Underpins Future Growth Prospects

ECM Weekly (12th Sep 2022) – Onewo, CALB, YSB, Medanta, Beneunder, JMDC, SH Holdings, Indigo

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, a few large Hong Kong IPOs are lining up to launch soon.
  • Placements picked up this week in Japan and India with most being secondary deals.

Pre-IPO Innovex Medical – A Comprehensive Product Portfolio Underpins Future Growth Prospects

By Xinyao (Criss) Wang

  • As one of the few companies in the world that could provide one-stop solutions including all major medical devices used in non-vascular interventional surgery, Innovex’s outlook is promising.
  • About 30% overseas revenue indicates that the Company’s internationalization is on track, which could help to “hedge” negative domestic policy risks.
  • In terms of the valuation, Innovex’s valuation should be higher than Scivita but lower than Aohua. However, Innovex has the potential to surpass Aohua in the future.

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Sep 12
0

Daily Brief Technical Analysis: USD Top Zone to Lead Risk Turn and more

By | Daily Briefs, Technical Analysis

In today’s briefing:

  • USD Top Zone to Lead Risk Turn

USD Top Zone to Lead Risk Turn

By Thomas Schroeder

  • USD dip/rise into overshoot zone as the green back begins to feel out a topping zone. The dollar typically tops a few weeks ahead of and equity troughing cycle.
  • DXY met our 110.50-111 tactical top target where we reduced overdone USD longs and placed a short bet (AUD and SGD) for a dip/rally.
  • Expect USD splinters to appear in coming weeks as the DXY top near the 111.25 projection if we hold 107.50 now.

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Sep 12
0

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

By | Credit, Daily Briefs

In today’s briefing:

  • Morning Views Asia: China SCE, Yuexiu Property

Morning Views Asia: China SCE, Yuexiu Property

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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Sep 12
0

Daily Brief Event-Driven: 111’s Opportunistic US$3.66 Bid from the Co-Founders and more

By | Daily Briefs, Event-Driven

In today’s briefing:

  • 111’s Opportunistic US$3.66 Bid from the Co-Founders
  • Backtesting Implications: Korea Sector ETFs Rebalancing on the 8th
  • Merger Arb Mondays (12 Sep) – DTAC/True, Link Admin, Ramsay, Genex, Tyro, EVOC, Giordano, 111
  • Repsol: Sale of 25% of E&P Division

111’s Opportunistic US$3.66 Bid from the Co-Founders

By Arun George

  • 111 Inc (YI US), the largest virtual pharmacy network in China, disclosed a privatisation proposal from a co-founder-led consortium at US$3.66 per ADS, a 20.0% premium to the undisturbed price. 
  • For privatisation to succeed, shareholders representing two-thirds of shares present and voting need to approve the deal. The co-founders represent 92.04% of the total voting power.
  • The offer price is unattractive but this is a done deal. At the last close, the gross and annualised spread for a January 2023 completion is 11.6% and 33.4%, respectively. 

Backtesting Implications: Korea Sector ETFs Rebalancing on the 8th

By Sanghyun Park

  • Compared to the tightly crowded KOSPI 200, the sector ETFs’ rebalancing flow trading appears relatively less crowded, which led to a significantly higher flow/price correlation on the rebalancing day.
  • The KRX now delivers the rebalancing results of the KRX Sector & K-New Deal Indexes only to paying customers. This can increase the profit effect of acquiring prior information.
  • So, safe play, which builds up a position from the time this information is acquired, rather than an aggressive preemptive position build-up, can still obtain a sufficient level of juice.

Merger Arb Mondays (12 Sep) – DTAC/True, Link Admin, Ramsay, Genex, Tyro, EVOC, Giordano, 111

By Arun George

Repsol: Sale of 25% of E&P Division

By Jesus Rodriguez Aguilar

  • The $19bn EV operation (vs. Repsol’s market cap of €19bn) allows Repsol to maintain the majority in a strategic area, crystallizes value (market assigns a higher valuation to the E&P division separately).
  • The implied valuation by the market is on average $3 billion lower. As usual with a minority stake sale, the market rarely values it at 100%. 
  • I estimate a moderate positive impact (the deal is similar to what was announced in July), value unlocking could theoretically reach €2.5-€3 per share, but I’d take a neutral stance.

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Sep 12
0

Daily Brief Macro: Assessing “Big Short” Michael Burry’s Crash Warning and more

By | Daily Briefs, Macro

In today’s briefing:

  • Assessing “Big Short” Michael Burry’s Crash Warning
  • How I Learned to Stop Worrying and Love the Bond Market

Assessing “Big Short” Michael Burry’s Crash Warning

By Cam Hui

  • A number of readers asked us to comment on Michael Burry’s forecast of a crash. We find Burry’s wildly bearish projection of S&P 1900 to be implausible.
  • Nevertheless, the S&P 500 faces strong valuation and macro headwinds in the near future.
  • On the other hand, conventional technical analysis view calls for market weakness and a bottom during the September–October time frame.

How I Learned to Stop Worrying and Love the Bond Market

By Cam Hui

  • Cross-Asset signals from the commodity market indicate that bond prices are poised to rise, which should provide tailwinds for large-cap NASDAQ stocks.
  • A key risk is continued market fears of rising rates from hawkish Fed rhetoric.
  • Another risk is a possible sudden policy reversal in response to crisis conditions, which changes the narrative from recessionary conditions to renewed growth.

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