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Smartkarma Daily Briefs

Jun 02
0

Daily Brief Equity Bottom-Up: The TJX Companies: Leveraging Vendor Relationships For A Competitive Edge! and more

By | Daily Briefs, Equity Bottom-Up

In today’s briefing:

  • The TJX Companies: Leveraging Vendor Relationships For A Competitive Edge!
  • Ivanhoe Mines (IVN CN): Seismic Setback Creates a Valuation Gap
  • DigiPlus Interactive (PLUS PM): Galloping Away Into A Strong Q2 FY25
  • Workday Inc.: Will Its WorkdayGO Initiatives Help to Quickly Modernize & Streamline The Enterprise Functions?
  • Nvidia’s $3.4 Trillion AI Empire Is Just Getting Started—You Won’t Believe What’s Next!
  • Target Corporation: Will Its Investments in Digital Fulfillment and Supply Chain Pay Off?
  • How The Home Depot Plans to Capture a $50 Billion Opportunity Amid Economic Uncertainty!
  • Korean Banks; Presidential Election Drives Positive View on Hana (086790 KS) And Woori (316140 KS)
  • Toll Brothers: Will Its Spec Home Strategy & Market Adaptation Be A Breakthrough Move?
  • Zijin Mining (601899 CH / 2899 HK): Evaluating the Impact of Kakula Suspension

The TJX Companies: Leveraging Vendor Relationships For A Competitive Edge!

By Baptista Research

  • The TJX Companies, Inc. reported its first-quarter results for fiscal year 2026, demonstrating resilient performance across its various divisions amidst a challenging macroeconomic environment.
  • The company achieved a 3% increase in comparable store sales, driven by higher customer transactions, with each division—both in the U.S. and internationally—contributing positively.
  • Notable growth was observed in the HomeGoods division, which outperformed its competitors, delivering a 4% increase in comp sales and a 70 basis point improvement in segment profit margin compared to the previous year.

Ivanhoe Mines (IVN CN): Seismic Setback Creates a Valuation Gap

By Rahul Jain

  • Kakula mining is suspended due to seismic activity; dewatering and repairs are ongoing, with potential resolution by late Q3 2025 as operations gradually stabilize.
  • Ivanhoe quadrupled copper output since 2021, maintaining over 55% EBITDA margins through high-grade ore and efficient operations.
  • At US$2,000/t copper reserve value, Ivanhoe offers 40%+ upside—past disruptions like Vale and Freeport saw strong rebounds as uncertainty cleared.

DigiPlus Interactive (PLUS PM): Galloping Away Into A Strong Q2 FY25

By Sameer Taneja

  • DigiPlus Interactive (PLUS PM) reported robust Q1 FY25 results, driven by an increase in MAUs to 7.5 million (6.5 in Q4). The company maintained its market share at ~45%.
  • Net margins expanded 200 bps QoQ (to 18.2%), as the company benefited from a 500 bps reduction in its share of GGR to PAGCOR. 
  • The stock has increased by >400% since January 2024, but it trades at 14.1x FY25 PE, with growth catalysts from the Philippines and Brazil expected in the future. 

Workday Inc.: Will Its WorkdayGO Initiatives Help to Quickly Modernize & Streamline The Enterprise Functions?

By Baptista Research

  • Workday Inc. reported a robust first quarter of fiscal year 2026, demonstrating solid growth in key financial metrics and notable advancements in its strategic initiatives.
  • The company reported a 13% increase in subscription revenue, reaching $2.059 billion, and achieved a non-GAAP operating margin of 30.2%.
  • This performance was driven by strong customer adoption across various industries, solid contributions from their partner ecosystem, and a continued focus on AI innovation.

Nvidia’s $3.4 Trillion AI Empire Is Just Getting Started—You Won’t Believe What’s Next!

By Baptista Research

  • Nvidia’s first-quarter results for fiscal 2026 showcased an extraordinary ability to maintain momentum in the face of geopolitical disruption, marking a defining moment in its trajectory as a dominant AI chipmaker.
  • The company reported a 69% year-over-year revenue surge to $44.1 billion, outperforming expectations despite the mid-April U.S. government ban on H20 GPU sales to China.
  • The data center segment remained the primary growth engine, rising 73% to $39.1 billion, driven by rising AI infrastructure demand and the adoption of its cutting-edge Blackwell architecture.

Target Corporation: Will Its Investments in Digital Fulfillment and Supply Chain Pay Off?

By Baptista Research

  • Target Corporation faced a set of challenging conditions in the first quarter of 2025, significantly impacting its overall performance.
  • The detailed analysis of the quarterly results reveals a balanced mix of positive aspects, setbacks, and strategic adjustments, offering investors insights into the company’s current standing and future priorities.
  • First-quarter sales for Target declined by 2.8%, primarily driven by a decrease in comparable sales of 3.8%.

How The Home Depot Plans to Capture a $50 Billion Opportunity Amid Economic Uncertainty!

By Baptista Research

  • The Home Depot, during its first quarter of fiscal 2025, reported sales of $39.9 billion, which represented a 9.4% increase compared to the same period last year.
  • However, the company’s comparable store sales declined slightly by 0.3%.
  • The U.S. comps showed a modest increase of 0.2%.

Korean Banks; Presidential Election Drives Positive View on Hana (086790 KS) And Woori (316140 KS)

By Victor Galliano

  • The “Value Up” initiative which kicked off in February 2024 has been intended to bring about corporate governance and market reforms which minority and especially foreign investors have long sought
  • So far, these voluntary reforms have brought positive albeit limited benefits to South Korean equities; presidential elections, with potential legislative change, should act as a positive valuation driver
  • We reiterate our positive views on Woori and Hana Financial which are the top banks based on our scorecard; these attributes are due to  attractive valuations and balance sheet credentials

Toll Brothers: Will Its Spec Home Strategy & Market Adaptation Be A Breakthrough Move?

By Baptista Research

  • During its second quarter earnings for fiscal 2025, Toll Brothers, Inc. outlined its financial and operational performance amidst a challenging economic environment, providing insights into its strategies and market outlook.
  • Toll Brothers reported robust financial performance for the second quarter, achieving record second quarter home sales revenue of $2.71 billion, which surpassed the midpoint of their guidance by $236 million.
  • They delivered 2,899 homes at an average selling price of approximately $934,000.

Zijin Mining (601899 CH / 2899 HK): Evaluating the Impact of Kakula Suspension

By Rahul Jain

  • A 4–6 month Kakula disruption could reduce Zijin’s 2025 copper output by 4–8%, cutting EBITDA by ~7–11%.
  • Ramp-Ups at Julong and Čukaru Peki can offset ~60–70% of the lost volume and partially protect margins.
  • Lithium is expected to grow from 8% to 20% of EBITDA by 2028, driven by 300kt LCE capacity from low-cost brine assets.

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Jun 02
0

Daily Brief TMT/Internet: Montage Technology , NTT Data Corp, Bestechnic Shanghai , Contemporary Amperex Technology (CATL), Workday Inc Class A, NVIDIA Corp, Autodesk Inc, Zoom Video Communications Inc, Applied Materials, Intuit Inc and more

By | Daily Briefs, TMT/Internet

In today’s briefing:

  • SSE50/SSE180 Index Rebalance: Some Surprises Among the Adds; Deletes as Expected
  • (Mostly) Asia M&A, May 2025 Wrap: NTT Data, ZEEKR, MAC Copper, Torii, Mitsu. Shokuhin, SBI Sumishin
  • STAR50/STAR100 Index Rebalance: 10 Changes and US$1.4bn Trade
  • ECM Weekly (2 June 2025) -Indigo, ITC, EBOS, Isuzu, Foshan Haitian, Lens Tech, Seres, Schloss, Aegis
  • Workday Inc.: Will Its WorkdayGO Initiatives Help to Quickly Modernize & Streamline The Enterprise Functions?
  • Nvidia’s $3.4 Trillion AI Empire Is Just Getting Started—You Won’t Believe What’s Next!
  • Autodesk Inc.: Transition to New Transaction Model to Maintain A Strong Foothold Amidst Macroeconomic Challenges!
  • Zoom Video Communications Unleashes AI Power With a 97% Self-Service Rate & Next-Gen Virtual Agent; What’s Next On The Innovation Front?
  • Applied Materials (AMAT) Is Revolutionizing Chip Design With Breakthrough Packaging Technology; What Lies Ahead?
  • Intuit Inc.: Its Expansion into QuickBooks Advanced and Intuit Enterprise Suite & Other Major Drivers!

SSE50/SSE180 Index Rebalance: Some Surprises Among the Adds; Deletes as Expected

By Brian Freitas

  • There are 4 changes for the SSE50 Index (SSE50 INDEX) and 18 changes for the SSE180 Index that will be implemented at the close on 13 June.
  • The SSE50 Index (SSE50 INDEX) deletes were in line with forecasts, and the index committee has used some discretion while picking the index inclusions.
  • The SSE50 Index adds have outperformed the deletes over the last few months and there could be a further move higher in the ‘surprise’ adds to the index.

(Mostly) Asia M&A, May 2025 Wrap: NTT Data, ZEEKR, MAC Copper, Torii, Mitsu. Shokuhin, SBI Sumishin

By David Blennerhassett

  • For May 2025, 13 new transactions (firm and non-binding) were discussed on Smartkarma (by the Quiddity team) with an overall announced deal size of ~US$27bn. 
  • The average premium for the new transactions announced (or first discussed) in May was ~28%, with a year-to-date average of 49%.
  • The average premiums for transactions in 2024 (129 transactions), (2023 (117), 2022 (106), 2021 (165), 2020 (158), and 2019 (145 ) were 43%, 39%, 41%, 33%, 31%, and 31%.

STAR50/STAR100 Index Rebalance: 10 Changes and US$1.4bn Trade

By Brian Freitas

  • There is 1 constituent change for the STAR50 INDEX and 4 changes for the STAR100 Index at the next rebalance that will be implemented at the close on 13 June.
  • We estimate turnover of 2.35% for the SSE STAR50 (STAR50 INDEX) and 4.9% for the STAR100 Index. The estimated round-trip trade is CNY 9.8bn (US$1.35bn).
  • There are multiple stocks that are adds or deletes for other indices and the passive flows will be a lot larger than just for the STAR50/STAR100 indices.

ECM Weekly (2 June 2025) -Indigo, ITC, EBOS, Isuzu, Foshan Haitian, Lens Tech, Seres, Schloss, Aegis

By Sumeet Singh

Workday Inc.: Will Its WorkdayGO Initiatives Help to Quickly Modernize & Streamline The Enterprise Functions?

By Baptista Research

  • Workday Inc. reported a robust first quarter of fiscal year 2026, demonstrating solid growth in key financial metrics and notable advancements in its strategic initiatives.
  • The company reported a 13% increase in subscription revenue, reaching $2.059 billion, and achieved a non-GAAP operating margin of 30.2%.
  • This performance was driven by strong customer adoption across various industries, solid contributions from their partner ecosystem, and a continued focus on AI innovation.

Nvidia’s $3.4 Trillion AI Empire Is Just Getting Started—You Won’t Believe What’s Next!

By Baptista Research

  • Nvidia’s first-quarter results for fiscal 2026 showcased an extraordinary ability to maintain momentum in the face of geopolitical disruption, marking a defining moment in its trajectory as a dominant AI chipmaker.
  • The company reported a 69% year-over-year revenue surge to $44.1 billion, outperforming expectations despite the mid-April U.S. government ban on H20 GPU sales to China.
  • The data center segment remained the primary growth engine, rising 73% to $39.1 billion, driven by rising AI infrastructure demand and the adoption of its cutting-edge Blackwell architecture.

Autodesk Inc.: Transition to New Transaction Model to Maintain A Strong Foothold Amidst Macroeconomic Challenges!

By Baptista Research

  • Autodesk delivered solid results in the first quarter of fiscal 2026, surpassing the upper limits of its guidance range for both revenue and non-GAAP earnings per share.
  • The company reported a revenue growth of 15% as reported and 16% in constant currency, with a significant contribution of $78 million from the new transaction model.
  • Billings also saw a substantial increase of 29% as reported and 30% in constant currency, reflecting a strategic shift towards annual billings for most multi-year contracts.

Zoom Video Communications Unleashes AI Power With a 97% Self-Service Rate & Next-Gen Virtual Agent; What’s Next On The Innovation Front?

By Baptista Research

  • Zoom Video Communications reported a solid performance in the first quarter of fiscal year 2026, showcasing growth in several key areas despite macroeconomic challenges.
  • The company generated $1.175 billion in revenue, reflecting a 3% year-over-year increase, and reported stronger-than-expected earnings with non-GAAP diluted net income per share reaching $1.43, surpassing guidance by $0.12.
  • The company attributed this performance largely to robust growth in its enterprise segment, which now constitutes 60% of total revenue.

Applied Materials (AMAT) Is Revolutionizing Chip Design With Breakthrough Packaging Technology; What Lies Ahead?

By Baptista Research

  • Applied Materials reported strong results in the second quarter of fiscal year 2025, marked by record earnings per share and robust financial performance.
  • The company achieved total net revenue of approximately $7.1 billion, reflecting a 7% increase year-over-year, with growth across all its business segments.
  • Non-GAAP earnings per share rose by 14% year-over-year to a record $2.39, supported by revenue growth, improved profitability, and share repurchases.

Intuit Inc.: Its Expansion into QuickBooks Advanced and Intuit Enterprise Suite & Other Major Drivers!

By Baptista Research

  • The third-quarter results for Intuit’s fiscal year 2025 illustrate a strong performance across multiple segments, driven primarily by its robust AI capabilities and strategic innovations.
  • Intuit reported a 15% increase in revenue, with significant contributions from both its Consumer Group and Global Business Solutions Group.
  • This quarter, the company raised its financial targets, attributing its success to its AI-driven platform which enhances customer interaction and streamlines processes for consumers, businesses, and accountants.

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Jun 02
0

Daily Brief Thematic (Sector/Industry): Ohayo Japan | Ukraine Stages Attack on Russian Bombers and more

By | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

  • Ohayo Japan | Ukraine Stages Attack on Russian Bombers
  • Japan Morning Connection: Hope for Trump-Xi Call Lifts Markets off the Lows
  • How MoRTH’s New Bidding Norm Can Change the Competitive EPC Sector?

Ohayo Japan | Ukraine Stages Attack on Russian Bombers

By Mark Chadwick

  • Despite volatility driven by Trump’s shifting remarks on China trade, the S&P 500 and Nasdaq ended Friday nearly flat, closing out their best month since November 2023.
  • Ukraine launched a major drone attack on Russian military bombers in Siberia, hitting over 40 warplanes at four airfields.
  • NEC announced plans to increase revenue for its digital transformation business “Blue Stella” to 1 trillion yen, representing 84% growth from fiscal 2025

Japan Morning Connection: Hope for Trump-Xi Call Lifts Markets off the Lows

By Andrew Jackson

  • TSMC planning a fab in UAE not enough to lift semi-cap names Friday.
  • New Switch on Thursday and the Summer Game Fest on Friday points to upside for laggard developers this week.
  • ISpace set to deliver UNESCO cultural hard drive to the moon this Friday.

How MoRTH’s New Bidding Norm Can Change the Competitive EPC Sector?

By Nimish Maheshwari

  • The Ministry of Road Transport & Highways(MoRTH) has revised bidding norms for central government road projects, effective April 30, 2025, removing the APS cap and lowering the trigger.
  • The EPC sector faced intense competition and aggressive underbidding from less stringent standards, causing project delays and quality issues. 
  • These changes aim to deter unsustainable bids, prevent margin erosion, filter speculative players, ease competition, and improve project execution and quality.

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Jun 02
0

Daily Brief Industrials: Zhongyuan Environment A, Aegis Vopak Terminals Ltd, Deere & Co, Elbit Systems and more

By | Daily Briefs, Industrials

In today’s briefing:

  • Quiddity CSI 1000 Jun25 Results: 200 Changes; US$2Bn+ One-Way
  • Aegis Vopak IPO: Anemic Demand
  • Deere & Company Doubles Down on Autonomy—Will See & Spray Transform Modern Agriculture?
  • Elbit Systems: Iron Beam Laser System Advancements

Quiddity CSI 1000 Jun25 Results: 200 Changes; US$2Bn+ One-Way

By Janaghan Jeyakumar, CFA

  • The June 2025 index review results for China’s CSI 1000 index were announced after market close on Friday 30th May 2025.
  • There will be 100 ADDs/DELs for CSI 1000 in the June 2025 rebalance.
  • The CSI 1000 index rebal event could trigger US$2.2bn in one-way flow.

Aegis Vopak IPO: Anemic Demand

By Nicholas Tan

  • Aegis Vopak Terminals Ltd (1902844D IN) raised about US$328m in its upcoming India IPO.
  • It is the largest Indian third-party owner and operator (in terms of storage capacity) of tank storage terminals for liquified petroleum gas (LPG) and liquid products.
  • In our previous notes, we talked about the company’s historical performance, undertook a peer comparison and shared our thoughts on valuation. In this note, we talk about the trading dynamics.

Deere & Company Doubles Down on Autonomy—Will See & Spray Transform Modern Agriculture?

By Baptista Research

  • Deere & Company’s latest earnings report highlights both accomplishments and challenges in a complex market environment marked by global uncertainties and macroeconomic pressures.
  • The company’s second quarter performance exceeded expectations, with a commendable 18.8% margin for equipment operations amidst significant headwinds, including heightened tariff impacts and global trade volatility.
  • Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology.

Elbit Systems: Iron Beam Laser System Advancements

By Baptista Research

  • Elbit Systems’ financial results for the first quarter of 2025 displayed strong growth and stable operational performance, continuing a trend from the past few quarters.
  • The company reported revenues of $1.896 billion, marking a significant increase from $1.554 billion for the same quarter in 2024.
  • This growth reflects a substantial demand across key markets, with Europe, North America, Asia Pacific, and Israel contributing 24%, 21%, 18%, and 32% of revenues, respectively.

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Jun 02
0

Daily Brief South Korea: Woori Financial Group and more

By | Daily Briefs, South Korea

In today’s briefing:

  • Korean Banks; Presidential Election Drives Positive View on Hana (086790 KS) And Woori (316140 KS)

Korean Banks; Presidential Election Drives Positive View on Hana (086790 KS) And Woori (316140 KS)

By Victor Galliano

  • The “Value Up” initiative which kicked off in February 2024 has been intended to bring about corporate governance and market reforms which minority and especially foreign investors have long sought
  • So far, these voluntary reforms have brought positive albeit limited benefits to South Korean equities; presidential elections, with potential legislative change, should act as a positive valuation driver
  • We reiterate our positive views on Woori and Hana Financial which are the top banks based on our scorecard; these attributes are due to  attractive valuations and balance sheet credentials

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Jun 02
0

Daily Brief Macro: Tariffs Create New Central Bank Agendas and more

By | Daily Briefs, Macro

In today’s briefing:

  • Tariffs Create New Central Bank Agendas, While Bank of Japan Faces Fiscal Policy Nightmare
  • Bullish Exhaustion = Pullback or Consolidation
  • Don’t Buy That TACO Just Yet

Tariffs Create New Central Bank Agendas, While Bank of Japan Faces Fiscal Policy Nightmare

By Said Desaque

  • Policy uncertainty still remains elevated despite the China-US tariff truce. Tariffs have created new easing agendas for central banks, while the Fed awaits new incoming economic information. 
  • US tariffs threats have forced the Bank of Japan (BoJ) to pause policy normalisation plans. Japanese government bond market stress may increase once the BoJ resumes raising its policy rate.
  • Governments and central banks are facing legacy issues from the period of combined easy monetary and fiscal policy stances as bond markets question sovereign governments’ capacity to borrow.

Bullish Exhaustion = Pullback or Consolidation

By Cam Hui

  • The recent violation of an upward sloping trend line in the face of positive news reinforces our view that the U.S. equity market is in a wide trading range. 
  • Technical conditions point to either a pullback or consolidation in the short-term.
  • Elevated valuation and continued uncertainty over trade policy, fiscal policy and the growth outlook all serve to create a roof over stock prices.

Don’t Buy That TACO Just Yet

By Cam Hui

  • The U.S. Court of International Trade unanimously ruled against the Trump Administration  and struck down a whole range of tariffs by citing a lack of authority.
  • In reaction, President Trump doubled down by opposing and appealing the decision. The government has workaround options in light of the court decision: The trade war will continue.
  • Investors should continue to tilt toward the “Sell America” trade by avoiding USD assets. The court decision prolongs and exacerbates the uncertainty over the effects of the trade war.

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Jun 02
0

Daily Brief Energy/Materials: Washington H. Soul Pattinson and Co. Ltd, Ivanhoe Mines, Zijin Mining Group , Eagle Materials and more

By | Daily Briefs, Energy & Materials Sector

In today’s briefing:

  • Soul Patts & Brickworks: Index Impact of A$14bn Merger
  • Soul Patts/Brickworks To Unwind Circularity
  • Ivanhoe Mines (IVN CN): Seismic Setback Creates a Valuation Gap
  • Zijin Mining (601899 CH / 2899 HK): Evaluating the Impact of Kakula Suspension
  • Eagle Materials: A Closer Look At Its Environmental & Economic Efficiency Projects & Other Major Growth Levers!

Soul Patts & Brickworks: Index Impact of A$14bn Merger

By Brian Freitas

Soul Patts/Brickworks To Unwind Circularity

By David Blennerhassett

  • The cross-shareholding between Washington H. Soul Pattinson (SOL AU) (Soul Patts) and Brickworks Ltd (BKW AU) was established in 1969 to defend the companies from the corporate raiders.
  • Perpetual pursued a case in the Federal Court of Australia, alleging that the cross-shareholding was oppressive to minority shareholders; however the claim was dismissed in 2017.
  • Today, via inter-conditional Schemes, the circularity is set to be unwound through a merger. Soul Patts currently owns 43.3% in Brickworks, and Brickworks 26% in Soul Patts. 

Ivanhoe Mines (IVN CN): Seismic Setback Creates a Valuation Gap

By Rahul Jain

  • Kakula mining is suspended due to seismic activity; dewatering and repairs are ongoing, with potential resolution by late Q3 2025 as operations gradually stabilize.
  • Ivanhoe quadrupled copper output since 2021, maintaining over 55% EBITDA margins through high-grade ore and efficient operations.
  • At US$2,000/t copper reserve value, Ivanhoe offers 40%+ upside—past disruptions like Vale and Freeport saw strong rebounds as uncertainty cleared.

Zijin Mining (601899 CH / 2899 HK): Evaluating the Impact of Kakula Suspension

By Rahul Jain

  • A 4–6 month Kakula disruption could reduce Zijin’s 2025 copper output by 4–8%, cutting EBITDA by ~7–11%.
  • Ramp-Ups at Julong and Čukaru Peki can offset ~60–70% of the lost volume and partially protect margins.
  • Lithium is expected to grow from 8% to 20% of EBITDA by 2028, driven by 300kt LCE capacity from low-cost brine assets.

Eagle Materials: A Closer Look At Its Environmental & Economic Efficiency Projects & Other Major Growth Levers!

By Baptista Research

  • Eagle Materials’ recent earnings release for the fiscal year 2025 highlights various aspects that investors might consider when evaluating the company’s performance and prospects.
  • The company reported a record revenue of $2.3 billion and record earnings per share of $13.77, marking its fourth consecutive year of record financial results.
  • Despite achieving these records, the results present a mixed picture, depicting both strengths and challenges faced by the company.

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Jun 02
0

Daily Brief Australia: Washington H. Soul Pattinson and Co. Ltd and more

By | Australia, Daily Briefs

In today’s briefing:

  • Soul Patts & Brickworks: Index Impact of A$14bn Merger
  • Soul Patts/Brickworks To Unwind Circularity

Soul Patts & Brickworks: Index Impact of A$14bn Merger

By Brian Freitas

Soul Patts/Brickworks To Unwind Circularity

By David Blennerhassett

  • The cross-shareholding between Washington H. Soul Pattinson (SOL AU) (Soul Patts) and Brickworks Ltd (BKW AU) was established in 1969 to defend the companies from the corporate raiders.
  • Perpetual pursued a case in the Federal Court of Australia, alleging that the cross-shareholding was oppressive to minority shareholders; however the claim was dismissed in 2017.
  • Today, via inter-conditional Schemes, the circularity is set to be unwound through a merger. Soul Patts currently owns 43.3% in Brickworks, and Brickworks 26% in Soul Patts. 

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Jun 02
0

Daily Brief Consumer: Isuzu Motors, Seven & I Holdings, Tjx Companies, DigiPlus Interactive , Target Corp, Home Depot Inc, Toll Brothers, Water Oasis, ZOZO Inc, TSE Tokyo Price Index TOPIX and more

By | Consumer, Daily Briefs

In today’s briefing:

  • [Japan Buybacks] – Buybacks Announced 26-30 May 2025 And Company Buyback History
  • Merger Arb Mondays (02 June) – Seven & I, SBI Sumishin, Shibaura, Mayne, ENN Energy, HKBN, Zeekr
  • The TJX Companies: Leveraging Vendor Relationships For A Competitive Edge!
  • DigiPlus Interactive (PLUS PM): Galloping Away Into A Strong Q2 FY25
  • Target Corporation: Will Its Investments in Digital Fulfillment and Supply Chain Pay Off?
  • How The Home Depot Plans to Capture a $50 Billion Opportunity Amid Economic Uncertainty!
  • Toll Brothers: Will Its Spec Home Strategy & Market Adaptation Be A Breakthrough Move?
  • Water Oasis H1 FY25 Results: An Improvement In Profitability And Cash 90% of Market Capitalization
  • Zozo Purchase of Lyst Is Timely
  • Governance Issues Were Not Highlighted and the Win-Win by REIT Sponsors and Investors Continues

[Japan Buybacks] – Buybacks Announced 26-30 May 2025 And Company Buyback History

By Travis Lundy

  • Buybacks in Japan are becoming a much greater driver of shareholder return than in previous years. The total amount of buybacks announced just during the March-end earnings season cleared ¥7trln.
  • Quiddity has developed a buyback tool which tracks Japanese buybacks and the buyback history for any given company. Isuzu Motors (7202 JP) announced a big post-Offering buyback this week.
  • Want to see how Isuzu has executed buybacks the past decade? Daily data? % volume? You can check here for any of the 21 companies which announced buybacks this week. 

Merger Arb Mondays (02 June) – Seven & I, SBI Sumishin, Shibaura, Mayne, ENN Energy, HKBN, Zeekr

By Arun George

The TJX Companies: Leveraging Vendor Relationships For A Competitive Edge!

By Baptista Research

  • The TJX Companies, Inc. reported its first-quarter results for fiscal year 2026, demonstrating resilient performance across its various divisions amidst a challenging macroeconomic environment.
  • The company achieved a 3% increase in comparable store sales, driven by higher customer transactions, with each division—both in the U.S. and internationally—contributing positively.
  • Notable growth was observed in the HomeGoods division, which outperformed its competitors, delivering a 4% increase in comp sales and a 70 basis point improvement in segment profit margin compared to the previous year.

DigiPlus Interactive (PLUS PM): Galloping Away Into A Strong Q2 FY25

By Sameer Taneja

  • DigiPlus Interactive (PLUS PM) reported robust Q1 FY25 results, driven by an increase in MAUs to 7.5 million (6.5 in Q4). The company maintained its market share at ~45%.
  • Net margins expanded 200 bps QoQ (to 18.2%), as the company benefited from a 500 bps reduction in its share of GGR to PAGCOR. 
  • The stock has increased by >400% since January 2024, but it trades at 14.1x FY25 PE, with growth catalysts from the Philippines and Brazil expected in the future. 

Target Corporation: Will Its Investments in Digital Fulfillment and Supply Chain Pay Off?

By Baptista Research

  • Target Corporation faced a set of challenging conditions in the first quarter of 2025, significantly impacting its overall performance.
  • The detailed analysis of the quarterly results reveals a balanced mix of positive aspects, setbacks, and strategic adjustments, offering investors insights into the company’s current standing and future priorities.
  • First-quarter sales for Target declined by 2.8%, primarily driven by a decrease in comparable sales of 3.8%.

How The Home Depot Plans to Capture a $50 Billion Opportunity Amid Economic Uncertainty!

By Baptista Research

  • The Home Depot, during its first quarter of fiscal 2025, reported sales of $39.9 billion, which represented a 9.4% increase compared to the same period last year.
  • However, the company’s comparable store sales declined slightly by 0.3%.
  • The U.S. comps showed a modest increase of 0.2%.

Toll Brothers: Will Its Spec Home Strategy & Market Adaptation Be A Breakthrough Move?

By Baptista Research

  • During its second quarter earnings for fiscal 2025, Toll Brothers, Inc. outlined its financial and operational performance amidst a challenging economic environment, providing insights into its strategies and market outlook.
  • Toll Brothers reported robust financial performance for the second quarter, achieving record second quarter home sales revenue of $2.71 billion, which surpassed the midpoint of their guidance by $236 million.
  • They delivered 2,899 homes at an average selling price of approximately $934,000.

Water Oasis H1 FY25 Results: An Improvement In Profitability And Cash 90% of Market Capitalization

By Sameer Taneja

  • Water Oasis (1161 HK)  H1 FY25 results were encouraging and a step in the positive direction as revenue/PAT improved by -2.5%/116% YoY
  • The company declared a semi-annual dividend of 3.5 cents (6.7% annualized yield) for a 43% payout ratio. Net cash of 633 million HKD represents 90% of the market capitalization.
  • Trading at 6.0x FY25 PE with earnings stabilization, this is a great name to explore, although we would like to see an improvement in capital allocation. 

Zozo Purchase of Lyst Is Timely

By Michael Causton

  • Zozo’s purchase of UK mall Lyst will create significant synergies, allowing Zozo to build a strong base in Europe and the US.
  • The move will allow brands from Japan to sell overseas easily, while also potentially making it simple for European and US brands to sell into Japan.
  • The deal comes just in time given slowing e-commerce sales in Japan.

Governance Issues Were Not Highlighted and the Win-Win by REIT Sponsors and Investors Continues

By Aki Matsumoto

  • While offering non-serious TOB prices, knowing that the likelihood of TOBs by the activist fund is low, the aim to extract concessions from the REIT and sponsor companies was successful.
  • The governance problem is the composition of the company, which continues to manage off-balance sheet real estate through its subsidiary REIT asset management company.
  • So far, however, governance issues have not received much attention, only confirming the sponsor companies’ willingness to continue REIT control and investors’ benefit from higher REIT stock prices by TOBs.

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Jun 02
0

Daily Brief Health Care: HealthyWay, Sichuan Biokin Pharmaceutical, Haw Par Corp, IHH Healthcare, Softcare and more

By | Daily Briefs, Healthcare

In today’s briefing:

  • KWEB Index Rebalance: HealthyWay In; East Buy Out
  • China Healthcare Weekly (Jun.1)-Akeso/Summit’s Disappointing Ph3 Readout,Valuation Outlook of Biokin
  • Haw Par (HPAR SP) —2025 Update
  • IHH Healthcare (IHH MK): Sustained Demand, Higher ARPOB Drive 1Q; Expansion Key for Future Growth
  • Pre-IPO Softcare – Strong Performance Growth Momentum Would Continue

KWEB Index Rebalance: HealthyWay In; East Buy Out

By Brian Freitas

China Healthcare Weekly (Jun.1)-Akeso/Summit’s Disappointing Ph3 Readout,Valuation Outlook of Biokin

By Xinyao (Criss) Wang

  • CR Sanjiu plans to transfer 49.8967% equity of Sanjiu (Anguo) and pay more attention to the quality of external M&As. China Resources+Tasly+KPC will be the core drivers of future performance.
  • Akeso’s first global phase 3 readout for ivonescimab was disappointing, which cast shadow on the final FDA approval. We shared our views on the outlook and valuation ahead.
  • The failure of HER3-DXd cast shadow over the outlook of HER3. We think Biokin is overvalued. Its valuation should be lower than Akeso and Kelun Bio.

Haw Par (HPAR SP) —2025 Update

By Michael Fritzell

  • Haw Par Corporation is a conglomerate owned by Singapore’s Wee family. It’s most famous for selling Tiger Balm — an ointment used for quick pain relief. But it also owns large stakes in commercial bank UOB and property developer UOL.

  • The business has continued to recover from COVID-19, when pharmacies had to close and tourism ground to a halt. Tiger Balm revenues are now back to their pre-COVID levels.

  • I get to an intrinsic value of SG$17.0 per share — well above the current share price of SG$11.8. And that’s assuming a 25% conglomerate discount.

IHH Healthcare (IHH MK): Sustained Demand, Higher ARPOB Drive 1Q; Expansion Key for Future Growth

By Tina Banerjee

  • IHH Healthcare (IHH MK) delivered 1QFY25 revenue of RM 6.3B, up 6%, driven by sustained demand, favorable patient mix of more acute patient, and higher revenue per in-patient.
  • Hospital and Healthcare’s Q1FY25 EBITDA remained flat as higher revenues were offset by higher staff cost and start-up cost of newly opened Acibadem Kartal Hospital.
  • Turkiye & Europe and Malaysia show strength. Margins remains under pressure in major markets.

Pre-IPO Softcare – Strong Performance Growth Momentum Would Continue

By Xinyao (Criss) Wang

  • Softcare has established its core competitiveness of “low price + localization”, and has achieved success in Africa. Softcare hopes to replicate its business model in Africa to other markets.
  • Emerging Markets have seen sustained growth in market penetration of baby/feminine hygiene products. We’re optimistic about Softcare’s future performance growth due to “demographic dividend + consumption upgrade” in Emerging Markets.
  • Softcare has strong fundamentals and promising outlook. We think valuation of Softcare should be higher than Hengan International Group (1044 HK) due to higher profit margin and future growth potential.

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