Smartkarma Daily Briefs

Reportedly, Blackstone is running a ruler over Dexus Property (DXS AU), one of Australia’s leading fully integrated real estate groups.
The Australian article flips flops: “Blackstone is understood to have been back on the scene“; but “cooled on the opportunity for now“.
Almost exactly four year ago, Blackstone paid A$2.1bn for a 49% stake in the Dexus Australian Logistics Trust, a prime logistics portfolio managed and jointly owned by Dexus.

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Dec 14

Daily Brief South Korea: Celltrion Inc, SGX Rubber Future TSR20 and more

By Smartkarma Daily Briefs | Daily Briefs, South Korea

In today’s briefing:

Celltrion: Meaningful Increase in Cash and Stock Dividends
ELTs Undertake An Impressive ‘Sustainable March’ In The US

Celltrion: Meaningful Increase in Cash and Stock Dividends

By Douglas Kim

Celltrion Inc (068270 KS) announced meaningful increase in dividends (including both cash and stock dividends).
Celltrion will pay out stock dividend of 0.05 for shareholders as of record in 2024, this will be 150% higher than the average stock dividend in the past three years.
Celltrion will also pay out cash DPS of 750 won for shareholders as of record in 2024, which is more than double the average DPS in the past three years.

ELTs Undertake An Impressive ‘Sustainable March’ In The US

By Vinod Nedumudy

79% of ELTs consumed by end-use markets, up 10.5%
Tire-derived fuel tops ELT use, followed by ground rubber
Sumitomo Rubber USA announces closing of Buffalo plant

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Dec 14

Daily Brief Singapore: SGX Rubber Future TSR20 and more

By Smartkarma Daily Briefs | Daily Briefs, Singapore

In today’s briefing:

ELTs Undertake An Impressive ‘Sustainable March’ In The US

ELTs Undertake An Impressive ‘Sustainable March’ In The US

By Vinod Nedumudy

79% of ELTs consumed by end-use markets, up 10.5%
Tire-derived fuel tops ELT use, followed by ground rubber
Sumitomo Rubber USA announces closing of Buffalo plant

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Dec 14

Daily Brief Indonesia: Global Digital Niaga Tbk PT and more

By Smartkarma Daily Briefs | Daily Briefs, Indonesia

In today’s briefing:

Global Digital Niaga (BELI IJ) – Speeding the Horses to Profitability

Global Digital Niaga (BELI IJ) – Speeding the Horses to Profitability

By Angus Mackintosh

A recent meeting with Global Digital Niaga (BELI IJ) looking at its longer-term strategy confirmed its differentiated standing, with a keen focus on an omnichannel strategy across key verticals.
The restructuring of its 1P business is yielding positive returns and higher margins, whilst its 3P business is being driven by strong performance from tiket.com, with offline stores performing well.
BELI recently opened a new 100,000 sqm distribution centre, which will further underpin its logistics excellence and improve delivery times even further. Valuations are attractive with profitability ahead in FY2025.

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Dec 14

Daily Brief India: Nuvama Wealth Management, Reliance Industries and more

By Smartkarma Daily Briefs | Daily Briefs, India

In today’s briefing:

2025 High Conviction: Nuvama – A Play on Burgeoning Wealth Management Industry in India
Lucror Analytics – Morning Views Asia

2025 High Conviction: Nuvama – A Play on Burgeoning Wealth Management Industry in India

By Ankit Agrawal, CFA

Going into CY25, Nuvama is one of our highest conviction ideas. It has potential to generate 75%+ upside, just from valuation gain.
India’s wealth management industry is in nascent phase led by under-penetration and a growing affluent, HNI and UHNI clientele.
Nuvama’s edge is its integrated platform bolstered by technology prowess and a solution-focused approach as opposed to a product-push model. It offers a holistic solution with a robust relationship-driven approach.

Lucror Analytics – Morning Views Asia

By Trung Nguyen

In the US, initial jobless claims increased to a two-month-high of 242 k (220 k e / 225 k p), likely due to the Thanksgiving holiday.
The PPI (final demand) came in at 3.0% y-o-y in November (2.6% e / 2.6% p), while core PPI (final demand) stood at 3.4% (3.2% e / 3.4% p).
US Treasuries were sold off for the second consecutive day, with the yields gaining 4-6 bps across the curve.

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Dec 14

Daily Brief China: Vesync, CPMC Holdings, JD.com Inc (ADR) and more

By Smartkarma Daily Briefs | China, Daily Briefs

In today’s briefing:

Vesync (2148 HK): Expect The Yangs To Privatise
CPMC Holdings (906 HK): Festive Cheer as Precondition Satisfied🎄
Jd.Com Inc (JD) – Friday, Sep 13, 2024

Vesync (2148 HK): Expect The Yangs To Privatise

Vesync (2148 HK), a manufacturer of small home appliance, is currently suspended pursuant to the Takeovers Code.
FY23 was Vesync’s best result since its December 2020 listing; and FY24E is on track to go one better. Yet the share price is 24% adrift of the IPO price.
The Yang family, led by chairman/CEO, control ~69.26% of Vesync. An Offer price around the IPO price may be enough to take Vesync private.

CPMC Holdings (906 HK): Festive Cheer as Precondition Satisfied🎄

By Arun George

ORG Technology Co., Ltd. A (002701 CH)’s offer for CPMC Holdings (906 HK) has received SAFE approval. Therefore, the precondition is satisfied.
The offer and response document will be despatched by 20 December and 3 January 2025, respectively. The Board will recommend the offer.
The offer should be declared unconditional by the first closing date. At the last close and late-January 2025 payment, the gross/annualized spread was 7.3%/88.0%.

Jd.Com Inc (JD) – Friday, Sep 13, 2024

By Value Investors Club

JD.com is a profitable Chinese e-commerce company trading below its cash value
Despite challenges in China’s retail market and competition from rivals, JD.com offers a potential 2x-3x upside over the next two years
Stock has fallen approximately 20% since last write-up, presenting a good opportunity for investors

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

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Dec 14

Daily Brief United States: ServiceTitan, NVIDIA Corp, Crude Oil, Bitcoin, SGX Rubber Future TSR20, Herbalife Ltd, Ocean Power Technologies, Culp Inc, Innodata and more

By Smartkarma Daily Briefs | Daily Briefs, United States

In today’s briefing:

ServiceTitan IPO: Pricing and First Trading-Day, The Stock Jumped ~42% As A Public Company
Nvidia Asserts Commitment to Fair Competition Amid China Antitrust Probe
OPEC Cuts Demand Forecasts for Fifth Straight Month; EIA Lowers Price Outlook on Supply Glut
[ETP 2024/50] WTI Rebounds on Outlook of Better Demand in 2025; Henry Hub Rises but Remains Volatile
Crypto Moves #56 – Suddenly We Are Once Again Discussing Inflation
ELTs Undertake An Impressive ‘Sustainable March’ In The US
Herbalife Ltd. – Uniquely Well Positioned Among Direct Sellers
Ocean Power Technologies, Inc: Lands $3 Million Multi-Year Contract in Latin America
Culp, Inc. – Revising Revenue/EPS Estimates
INOD: Growth Pathway in 2025

ServiceTitan IPO: Pricing and First Trading-Day, The Stock Jumped ~42% As A Public Company

By Andrei Zakharov

ServiceTitan, a provider of field service management software for home service businesses, priced its IPO at $71.00/share and raised ~$625M.
ServiceTitan IPO has seen robust demand among institutional investors. The company boosted its initial price range to $65.00 to $67.00 per share.
The offering was priced above the price range, valuing ServiceTitan at ~$6.5B. The stock jumped ~42% on first day as a public company and closed at $101.00 on Thursday.

Nvidia Asserts Commitment to Fair Competition Amid China Antitrust Probe

By Caixin Global

Nvidia Corp. on Tuesday asserted its commitment to fair competition, after China’s market regulators opened an antitrust investigation into the U.S. chip giant over suspected violations linked to a 2020 deal.
The probe, announced on Monday by the State Administration for Market Regulation (SAMR), concerns Nvidia’s compliance with the country’s Anti-Monopoly Law and conditions tied to its $6.9 billion acquisition of Israeli network-equipment maker Mellanox Technologies Ltd.
The deal — the largest acquisition Nvidia has ever made — faced intense scrutiny from Chinese regulators, who conditionally approved it after nearly a year-long process.

OPEC Cuts Demand Forecasts for Fifth Straight Month; EIA Lowers Price Outlook on Supply Glut

By Suhas Reddy

OPEC cut its 2024 demand growth forecast for the fifth consecutive time this year. It lowered its 2024 and 2025 forecast 11.5% and 5.8%, respectively.
The EIA and IEA lowered their 2024 demand projections by 10.1% and 8.7%, respectively. However, they raised their 2025 projections by 5.7% and 11.1%, respectively.
The EIA reduced 2024 and 2025 price forecasts for WTI and Brent, citing higher non-OPEC+ production and subdued demand, which are expected to drive global inventory builds after Q1 2025.

[ETP 2024/50] WTI Rebounds on Outlook of Better Demand in 2025; Henry Hub Rises but Remains Volatile

By Suhas Reddy

For the week ending 06/Dec, US crude inventories fell by 1.4m barrels, beating expectations of a 1m barrel decrease. However, gasoline and distillate stocks rose more than expected again.
US natural gas inventories fell by 190 Bcf for the week ending 06/Dec, beating analyst expectations of a 175 Bcf drawdown. Inventories are 4.6% above the 5-year seasonal average.
Wells Fargo raised its 12-month PT for Chevron but lowered targets for Shell and Occidental. Exxon targets a CAGR of 10% in earnings and 8% in cash flow through 2030.

Crypto Moves #56 – Suddenly We Are Once Again Discussing Inflation

By Mads Eberhardt

It should come as no surprise that inflation dominated headlines throughout 2022 and 2023.
This was largely because central banks around the world, including the U.S. Federal Reserve (Fed) and the European Central Bank (ECB), had to respond to rising inflation by aggressively increasing interest rates.
The chart below highlights these interest rate changes.

ELTs Undertake An Impressive ‘Sustainable March’ In The US

By Vinod Nedumudy

79% of ELTs consumed by end-use markets, up 10.5%
Tire-derived fuel tops ELT use, followed by ground rubber
Sumitomo Rubber USA announces closing of Buffalo plant

Herbalife Ltd. – Uniquely Well Positioned Among Direct Sellers

By Water Tower Research

The GIG economy has been viewed as a disruptor to the direct selling channel with respect to the business opportunity.
However, GIG concepts are top-down, have a specific formula, and assign tasks to their independent contractors for a fee, while direct sellers are micro-entrepreneurs who find a way to build their own businesses.
Herbalife has been successful in taking some of the best business models developed by distributors at a local level, and then globalizing them, such as. the Nutrition Clubs that arose in Mexico in the early 2000s.

Ocean Power Technologies, Inc: Lands $3 Million Multi-Year Contract in Latin America

By Water Tower Research

Ocean Power Technologies has secured a new partnership in Latin America with $3 million in purchase order commitments over three years.
This new agreement adds to a previous $1.5 million order, bringing the total to $4.5 million.
The partnership will involve the deployment of OPT’s WAM-V unmanned surface vehicles (USVs) for hydrographic applications and other diverse tasks.

Culp, Inc. – Revising Revenue/EPS Estimates

By Water Tower Research

Culp posted another tough quarter (1), as industry conditions remain challenged.
The firm posted an adjusted EPS loss of $0.28, $0.10 below our estimate and $0.09 below the prior year on weaker-than-expected earnings.
As we said in our update after the release, this shortfall may have been unexpected, but it’s certainly not surprising to anyone who has been following the space.

INOD: Growth Pathway in 2025

By Hamed Khorsand

The risk to INOD experiencing a sequential decline in spending activity in the near-term could have been alleviated from the continued spending in artificial intelligence (“A.I.”).
AMZN and GOOGL have their internally developed processors ready for high performance deep learning. The new chips suggest A.I. training is not going anywhere and could expand in 2025.
INOD’s revenue growth has been predominantly from one customer. This should begin to change in 2025.

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Dec 14

Daily Brief Japan: Exedy Corp, Fuji Soft Inc, Hachijuni Bank, 3 D Matrix Ltd, TSE Tokyo Price Index TOPIX, CellSource , CRE Inc/Japan and more

By Smartkarma Daily Briefs | Daily Briefs, Japan

In today’s briefing:

[Japan Activism] Exedy (7278 JP) – Buying Back Bigly
Fuji Soft (9749 JP) – Bain Bumps UnBigly, and FSI Responds
Japanese Midcap Banks – Hachijuni (8359 JP) Is Our Top Pick
3 D Matrix Ltd (7777 JP): 1H FY04/25 flash update
Guarantee Program for GHG Disclosure Will Start in FY3/2028 with Limited Guarantee for Scope 1 and 2
CellSource (4880 JP): Full-year FY10/24 flash update
CRE Inc/Japan (3458 JP): Q1 FY07/25 Flash update

[Japan Activism] Exedy (7278 JP) – Buying Back Bigly

Exedy Corp (7278 JP) announced an offering of 36% of its shares at end-May. Long-time “owner” Aisin (7259 JP) was getting out. Since then, the company has bought back shares.
Activist Murakami Group has bought 27% of the company. Between Murakami and the buyback, the public has net sold 5% of the company since end-March. Kinda shocking.
There is another 35% of Max Real World Float to buy back, and at current pace, they’ll be done by mid-March 2025. Then what? That’s the really big question.

Fuji Soft (9749 JP) – Bain Bumps UnBigly, and FSI Responds

~4 weeks ago, Fuji Soft Inc (9749 JP) responded to Bain’s Proposal to take over the company but got KKR to bid ¥1 more, then said that covered it.
The Special Committee then asked the FSI Board to halt further negotiations with Bain, and to ask Bain to destroy all confidential documentation.
Bain rejected saying it contravened METI Guidelines on Corporate Takeovers and reappeared 2 days ago with a ¥9,600 bid. The structure/details of Bain’s bid was probably a strategy mistake.

Japanese Midcap Banks – Hachijuni (8359 JP) Is Our Top Pick

By Victor Galliano

We update our views on ten Japanese midcap banks targeting attractively valued beneficiaries of the realization of big strategic shareholdings, as well as beneficiaries of the improving interest rate outlook
We re-iterate our buys on Hachijuni Bank and Hokuhoku Financial; there is potential to realize their large strategic holdings relative to their market capitalizations combined with their attractive PTBV ratios
We take Gunma Bank off the buy list, replacing it with Iyogin; Iyogin has a constructive mix of large strategic holdings, attractive valuations and healthy gearing to higher interest rates

3 D Matrix Ltd (7777 JP): 1H FY04/25 flash update

By Shared Research

Operating revenue increased by 78.3% YoY to JPY3.3bn, driven by sales of TDM-621 across multiple regions.
Operating loss narrowed to JPY532mn, with a recurring loss of JPY798mn and a net loss of JPY806mn.
US sales grew 151.4% YoY, achieving profitability; Europe and Japan also reported significant YoY sales growth.

Guarantee Program for GHG Disclosure Will Start in FY3/2028 with Limited Guarantee for Scope 1 and 2

By Aki Matsumoto

From FY3/2027, companies with market capitalization of over 3 trillion yen will be required to disclose GHG sequentially. 76% of companies with market capitalization of over 500 billion yen disclose.
A guarantee program is scheduled to be introduced in FY3/2028, but only 21% of companies with market capitalization of over 500 billion yen have disclosed their guarantees.
The guarantee program will begin in Scope 1 and 2 with limited guarantees. Disclosure of guarantees will increase once the discussion on qualification system for guarantee service providers is finalized.

CellSource (4880 JP): Full-year FY10/24 flash update

By Shared Research

Revenue for FY10/24 was JPY4.4bn, a 3.4% YoY decrease, with operating profit down 89.4% YoY to JPY129mn.
FY10/25 forecasts include revenue of JPY4.5bn (+3.4% YoY) and operating profit of JPY370mn (+186.5% YoY).
Contract processing services revenue declined 12.8% YoY in FY10/24, with orders decreasing by 13.9% YoY.

CRE Inc/Japan (3458 JP): Q1 FY07/25 Flash update

By Shared Research

In Q1 FY07/25, the company reported sales of JPY11.5bn and business profit of JPY1.2bn, showing YoY growth.
Logistics Investment business saw increased leasing income, with sales of JPY5.9bn and segment profit of JPY820mn, up 70.5% YoY.
The company sold LogiSquare Narita, resulting in sales of JPY4.5bn and segment profit of JPY583mn, reversing previous losses.

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Dec 14

Most Read: Cloud Village, Fosun Tourism, Zomato, LG Electronics India, Insignia Financial, Exedy Corp, Fuji Soft Inc, Vesync, Broadcom , Dexus Property and more

By Smartkarma Daily Briefs | Daily Briefs, Most Read

In today’s briefing:

KWEB Index Rebalance: 1 Add & 4 Deletes in December
Fosun Tourism (1992 HK): Fosun Int’l’s Indirect Takeover
NIFTY200 Momentum30 Index Rebalance: 38 Changes; 65% Turnover; US$1.7bn Trade
LG Electronics India: IPO Details & Index Entry Timing
Insignia Financial (IFL AU): Bain’s Indicative Proposal a Tad Light
[Japan Activism] Exedy (7278 JP) – Buying Back Bigly
Fuji Soft (9749 JP) – Bain Bumps UnBigly, and FSI Responds
Vesync (2148 HK): Expect The Yangs To Privatise
Broadcom: AI Hyper-Growth to Continue – Worries of a Slowdown Are Wrong – Positive to SK Hynix, TSMC
Blackstone Eyes Move On Dexus (DXS AU)

KWEB Index Rebalance: 1 Add & 4 Deletes in December

The December rebalance of the KraneShares CSI China Internet ETF (KWEB US) will take place at the close of trading on 13 December.
Cloud Village (9899 HK) is an add while Lufax Holding (LU US), Ping An Healthcare and Technology (1833 HK), ZX (9890 HK) and YSB (9885 HK) are deletes.
The deletions of Ping An Healthcare (1833 HK), ZX (9890 HK) and YSB (9885 HK) were forecast and there will be positioning in the stocks. Lufax was a close delete.

Fosun Tourism (1992 HK): Fosun Int’l’s Indirect Takeover

When Fosun Tourism (1992 HK), a leisure-focused integrated tourism group, was suspended pursuant to the Takeovers Code, the obvious Offeror, by way of a Scheme, was Fosun International (656 HK)
Not quite. We do have a Scheme, but it’s being enacted by way of a buyback. Fosun Int’l still abstains from voting, but will control 100% if the Scheme completes.
The Cancellation Price is $7.80/share (not declared final), a punchy 95% premium to undisturbed. I previously speculated a 100% premium was not out of the question. Clean deal.

NIFTY200 Momentum30 Index Rebalance: 38 Changes; 65% Turnover; US$1.7bn Trade

There are 19 changes a side for the Nifty200 Momentum30 Index that will be implemented at the close on 30 December. All names are exactly in line with our forecast.
Estimated one-way turnover is 64.9% resulting in a one-way trade of INR 72.7bn (US$857m). There are 18 stocks with over 1x ADV to trade.
The adds have continued to outperform the deletes even after the end of the review period. There could be further upside heading into year-end and implementation of the changes.

LG Electronics India: IPO Details & Index Entry Timing

LG Electronics India (123D IN) is looking to list on the exchanges by selling 101.8m shares at a valuation of around US$12-13bn and raising around US$1.8bn in its IPO.
The draft RHP was filed on 6 December, so the IPO could complete in the first quarter of 2025.
The stock will not get Fast Entry to global indices. Inclusion at regular rebalances could commence in June/September next year depending on when the stock lists.

Insignia Financial (IFL AU): Bain’s Indicative Proposal a Tad Light

IOOF Holdings (IFL AU) has received an indicative proposal from Bain Capital to acquire all of its shares at A$4/share in cash.
The offer takes advantage of IOOF Holdings (IFL AU)‘s underperformance over the last couple of years and there could be competing offers from other investment managers.
Short interest in IOOF Holdings (IFL AU) is around 2% of shares out and 2.5% of float. There could be short covering in the next few days.

[Japan Activism] Exedy (7278 JP) – Buying Back Bigly

Exedy Corp (7278 JP) announced an offering of 36% of its shares at end-May. Long-time “owner” Aisin (7259 JP) was getting out. Since then, the company has bought back shares.
Activist Murakami Group has bought 27% of the company. Between Murakami and the buyback, the public has net sold 5% of the company since end-March. Kinda shocking.
There is another 35% of Max Real World Float to buy back, and at current pace, they’ll be done by mid-March 2025. Then what? That’s the really big question.

Fuji Soft (9749 JP) – Bain Bumps UnBigly, and FSI Responds

~4 weeks ago, Fuji Soft Inc (9749 JP) responded to Bain’s Proposal to take over the company but got KKR to bid ¥1 more, then said that covered it.
The Special Committee then asked the FSI Board to halt further negotiations with Bain, and to ask Bain to destroy all confidential documentation.
Bain rejected saying it contravened METI Guidelines on Corporate Takeovers and reappeared 2 days ago with a ¥9,600 bid. The structure/details of Bain’s bid was probably a strategy mistake.

Vesync (2148 HK): Expect The Yangs To Privatise

Vesync (2148 HK), a manufacturer of small home appliance, is currently suspended pursuant to the Takeovers Code.
FY23 was Vesync’s best result since its December 2020 listing; and FY24E is on track to go one better. Yet the share price is 24% adrift of the IPO price.
The Yang family, led by chairman/CEO, control ~69.26% of Vesync. An Offer price around the IPO price may be enough to take Vesync private.

Broadcom: AI Hyper-Growth to Continue – Worries of a Slowdown Are Wrong – Positive to SK Hynix, TSMC

By Nicolas Baratte

FY24 AI revenue as guided US$12.2bn. 1Q25 AI revenue to increase 65% YoY. FY27 “serviceable market” or “opportunity” could reach US$60-90bn. Actual revenues could be ~70% of that.
Mngt announced another 2 hyperscale customers (one is Apple). At least 1 new new customer could add significant revenues before FY27 (adding to the 60-90bn above).
Stock up 14% aftermarket, trading at 32x FY25 EPS. We expect Consensus EPS to revise up 10-20%. Nvidia trades at 32x next FY (FY26). Positive to suppliers Hynix and TSMC.

Blackstone Eyes Move On Dexus (DXS AU)