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Smartkarma Daily Briefs

Apr 28
0

Daily Brief Industrials: Keyence Corp, Kokuyo Co Ltd and more

By | Daily Briefs, Industrials

In today’s briefing:

  • Keyence (6861 JP): A Beneficiary of Rising Interest Rates
  • Kokuyo Co Ltd (7984 JP): Q1 FY12/25 flash update

Keyence (6861 JP): A Beneficiary of Rising Interest Rates

By Scott Foster

  • Keyence stands to benefit from a rising return on its large holdings of cash and securities, which are also available for investment and higher dividends.
  • The company’s engineering-service business model should keep gross and operating margins high while it continues to expand overseas.
  • Projected valuations at the low end of their 5-year ranges. Recession and abrupt appreciation of the yen are the primary risks.

Kokuyo Co Ltd (7984 JP): Q1 FY12/25 flash update

By Shared Research

  • Revenue increased by 3.5% YoY to JPY99.5bn, driven by demand in the Furniture business for office relocations.
  • Operating profit rose by 14.4% YoY to JPY13.5bn, with a 1.6pp increase in GPM due to price revisions.
  • Net income attributable to owners of the parent decreased by 16.4% YoY, despite increases in operating and recurring profits.

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Apr 28
0

Daily Brief TMT/Internet: Shibaura Electronics, Intel Corp, AppLovin , Kakao Corp and more

By | Daily Briefs, TMT/Internet

In today’s briefing:

  • Weekly Deals Digest (27 Apr) – Shibaura, Fujitsu General, Gunma/DHFG, Bright Smart, DN Solutions
  • Intel Q125 Earnings. Outlook Disappoints As LBT Shows Senior Executives The Door
  • S&P500: Additions In May & June 2025 Following Capital One’s Approved Acquisition
  • ECM Weekly (28 Apr 2025) – Ather, DN Solutions, Lotte, BenQ, Dorf-Ketal, Hi-Think, Kakao, Waaree

Weekly Deals Digest (27 Apr) – Shibaura, Fujitsu General, Gunma/DHFG, Bright Smart, DN Solutions

By Arun George

Intel Q125 Earnings. Outlook Disappoints As LBT Shows Senior Executives The Door

By William Keating

  • Intel reported Q125 revenues of $12.7 billion, down 0.4% YoY, down 11% QoQ but still $500 million above the guided midpoint, precisely the same beat as in the prior quarter.
  • Looking ahead, Intel forecasted current quarter revenues of $11.8 billion at the midpoint, this time extending the range from $1 billion in the prior quarter to $1.2 billion
  • LBT is in the process of undertaking sweeping changes to his ELT, flattening its structure, taking on multiple additional reports and showing many senior executives the door. That’s good.

S&P500: Additions In May & June 2025 Following Capital One’s Approved Acquisition

By Dimitris Ioannidis

ECM Weekly (28 Apr 2025) – Ather, DN Solutions, Lotte, BenQ, Dorf-Ketal, Hi-Think, Kakao, Waaree

By Sumeet Singh

  • Aequitas Research’s weekly update on the IPOs, placements, lockup expiry and other ECM linked events that were covered by the team over the past week.
  • On the IPO front, Ather Energy, DN Solutions (298440 KS) and Lotte Global Logistics were live this week, with few other gearing up for launches in Hong Kong.
  • On the placements front, Kakao Corp (035720 KS) was the only sizable placement over the past week. We did look at a few more IPO linked lockup expiries.

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Apr 28
0

Daily Brief Consumer: Toyota Industries, Alibaba Group Holding , Laopu Gold, Seven & I Holdings, Deliveroo, Sheng Siong, SHEIN, Ather Energy, China New Higher Education and more

By | Consumer, Daily Briefs

In today’s briefing:

  • Toyota Industries (6201) – SURPRISE! It’s a TOYODA Takeover Proposal (Good Governance May Not Win)
  • Alibaba (9988 HK): Top Trades and Strategic Insights from HKEX Options Trading
  • Alibaba (9988 HK): Volatility Surface Favoring Diagonal and Calendar Spreads
  • Laopu Gold (6181 HK): Global Index Inclusion Likely Derailed by Full Circulation
  • Merger Arb Mondays (28 Apr) – Seven & I, Shibaura, Makino, Bright Smart, ENN Energy, Tam Jai
  • Deliveroo’s Special of the Day: A DoorDash Takeover
  • Singapore Retail Sector: Will It Be Impacted by Improved Connectivity with Malaysia?
  • May 1st Marks End of US “De Minimis” Exemption that Has Enabled Growth of SHEIN, Temu, & AliExpress
  • Ather Energy IPO: Expensive and No Immediate Index Inclusion
  • China New Higher Education (2001 HK): Stays Cheap at 1.7x PER and 0.3x P/B

Toyota Industries (6201) – SURPRISE! It’s a TOYODA Takeover Proposal (Good Governance May Not Win)

By Travis Lundy

  • On Friday after the close, media reports surfaced that Toyota Motor (7203 JP) Group chairman and founding family member had put forth a take-private proposal to Toyota Industries (6201 JP). 
  • The number quoted was ¥6trln market cap (most) or EV (FT), financed by personal funds, 3 megabanks, and reportedly some group companies. 
  • ¥6trln market cap would be +50%. ¥6trln EV +16%. Simultaneously shocking but somehow not surprising. Opportunistic, and surprisingly elegant as a family/group/cultural solution. More below.

Alibaba (9988 HK): Top Trades and Strategic Insights from HKEX Options Trading

By Gaudenz Schneider

  • Over the past five trading days, Alibaba Group Holding (9988 HK) multi-leg option strategies showcased a variety of approaches. Strategy highlights are provided.
  • Diagonal Spreads account for nearly 30% of all strategies. Many of these strategies sell short term risk to finance longer term protection.
  • Several structures hedge against low probability tail events. One such strategy traded 100 contracts.

Alibaba (9988 HK): Volatility Surface Favoring Diagonal and Calendar Spreads

By Gaudenz Schneider

  • Alibaba Group Holding (9988 HK) one-month implied volatility has decreased from recent peaks but remains above the 70th percentile, while realized volatility exceeds 80% (96th percentile).
  • A relatively flat term structure and skew render Calendar and Diagonal Spreads interesting strategies.
  • Open interest extends to March 2026, with balanced call and put interest across all expiries.

Laopu Gold (6181 HK): Global Index Inclusion Likely Derailed by Full Circulation

By Brian Freitas

  • Laopu Gold (6181 HK) was on track to be added to a global index given its large H-share market cap and a free float that was close to 20%.
  • Completion of the full circulation in April pushed H-share market cap higher while free float market cap remained the same. Crucially, free float dropped below 15%.
  • Laopu Gold (6181 HK) could miss index inclusion in May, while inclusion in August will need some selling from non-float investors following lock-up expiry in June.

Merger Arb Mondays (28 Apr) – Seven & I, Shibaura, Makino, Bright Smart, ENN Energy, Tam Jai

By Arun George

Deliveroo’s Special of the Day: A DoorDash Takeover

By Jesus Rodriguez Aguilar

  • DoorDash has proposed a cash offer of 180p per share for Deliveroo, representing a 22.7% premium. Deliveroo’s Board is supportive, and the offer values the company at 11.5x EV/NTM EBITDA.
  • Regulatory risk appears low given limited market overlap between DoorDash and Deliveroo, with a 3–6 month estimated closing timeline; shareholder approval and standard antitrust clearances remain the key conditions.
  • The deal could trigger a competitive bidding war, particularly from Amazon, a 14% shareholder in Deliveroo, potentially raising valuations towards 13–14x EV/NTM EBITDA and extending the timeline into 2026.

Singapore Retail Sector: Will It Be Impacted by Improved Connectivity with Malaysia?

By Devi Subhakesan

  • The upcoming Johor Bahru-Singapore Rapid Transit System and the ease of cross-border movements could impact Singapore’s retail sector as more consumers may choose to spend across the border.
  • DFI Retail CEO cited this as rationale for exiting Singapore based grocery retail business under Cold Storage and Giant’s brands. Sheng Siong group said it will carefully monitor this development.
  • Singapore retail prices for branded consumer discretionary and staples are between 30%-50% higher than in Malaysia. With greater ease of commute and shipping, this price differential may not be sustainable.

May 1st Marks End of US “De Minimis” Exemption that Has Enabled Growth of SHEIN, Temu, & AliExpress

By Daniel Hellberg

  • Crucial US “de minimis” imports exemption will end this Thursday night, May 1st
  • Beginning May 2nd, low-value direct-to-US consumer imports subject to duties, reporting 
  • For US consumers, buying from SHEIN et al set to become more expensive, more onerous

Ather Energy IPO: Expensive and No Immediate Index Inclusion

By Brian Freitas

  • Ather Energy is looking to raise INR 30bn (US$349m) in its IPO, valuing the company at INR 120bn (US$1.4bn). The company appears to be expensive compared to peers.
  • Ather Energy could be added to one global smallcap index in August/November and to another in December/March. Small Cap classification for AMFI and no major local index inclusion.
  • The continued selloff in Ola Electric will give investors pause, especially given Ather Energy‘s stagnant market share and continued losses. There is supply in Ola Electric with PE/VC investors selling. 

China New Higher Education (2001 HK): Stays Cheap at 1.7x PER and 0.3x P/B

By Osbert Tang, CFA

  • China New Higher Education (2001 HK)‘s gearing (including contract liabilities) has come down to 61.2% in 1H25, from 69.9% in FY24 and 84.1% in FY23 – an encouraging trend. 
  • Net profit grew 8.6%, even faster than the full-year consensus forecast of 3.5% growth. There are multiple drivers that support its medium-term outlook.
  • CNHE trades on 1.7x PER and 0.3x P/B, but the FY25 ROE is a solid 16.6%. Should the payout ratio remain unchanged, its yield will reach 28.4%.

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Apr 28
0

Daily Brief Energy/Materials: Godawari Power and Ispat, Copper, Iron Ore, Japan Pure Chemical and more

By | Daily Briefs, Energy & Materials Sector

In today’s briefing:

  • GPIL: Mining to Recycling
  • Copper Tracker 28th April 2025: A Huge Positive From The China March Lending Data
  • Iron Ore Tracker (28-Apr-2025): Iron Ore Within The Band, China Lending Data To The Rescue
  • Japan Pure Chemical (4973 JP): Full-year FY03/25 flash update

GPIL: Mining to Recycling

By Rahul Jain

  • GPIL operates integrated iron ore mining, pellet, and steel facilities with captive power assets in Chhattisgarh.
  • Acquired 51% stake in Jammu Pigments to enter non-ferrous recycling.
  • Focused on mining and pellet capacity expansion, with selective growth in recycling and smaller steel projects.

Copper Tracker 28th April 2025: A Huge Positive From The China March Lending Data

By Sameer Taneja

  • China’s Total Social Financing (TSF) saw a 22% YoY rise, reaching 5.89 trillion yuan, surpassing the expected 4.8 trillion yuan and boosting optimism for preemptive stimulus measures.
  • COMEX spreads rose above 1200 USD/ton, while Yangshan premiums climbed to 90 USD/ton, reinforcing our positive outlook on copper prices.
  • Positive Q1 FY25 results from Southern Copper (SCCO US), First Quantum Minerals (FM CN), and Antofagasta PLC (ANTO LN)‘s positive production update have set the tone for a bullish copper outlook.

Iron Ore Tracker (28-Apr-2025): Iron Ore Within The Band, China Lending Data To The Rescue

By Sameer Taneja

  • Iron ore prices experienced a modest WoW increase of 0.2%, reflecting easing trade tensions as the US considers reducing some of the stringent tariffs previously imposed.
  • China’s Total Social Financing (TSF) increased by 22% YoY, reaching 5.89 trillion yuan, surpassing the expected 4.8 trillion yuan and boosting optimism for preemptive stimulus measures.
  • China’s March steel production rose 5% YoY to 92.8 million tons, underscoring its vital role in the market, contributing 56% to total global production.

Japan Pure Chemical (4973 JP): Full-year FY03/25 flash update

By Shared Research

  • Revenue in FY03/25 grew 10.4% YoY, with operating profit increasing 41.8% YoY, driven by generative AI demand.
  • Net income surged 188.1% YoY due to gains on the sale of shares, despite slowing automotive sales.
  • JPC anticipates steady demand for AI-related applications and expects revenue growth in FY03/26 despite higher expenses.

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Apr 28
0

Daily Brief Financials: Bright Smart Securities And, Sinarmas Land and more

By | Daily Briefs, Financials

In today’s briefing:

  • Ant Group Takes Out Yip’s Controlling Stake In Bright Smart (1428 HK)
  • Sinarmas Land (SML SP): Potential Outcomes as IFA Says NOT Fair but Reasonable
  • Bright Smart (1428 HK): To Sell or Not to Sell?

Ant Group Takes Out Yip’s Controlling Stake In Bright Smart (1428 HK)

By David Blennerhassett

  • When broker Bright Smart Securities (1428 HK) was suspended recently, one possibility was Chairman, Peter Yip Mow-lum, a 50.54% shareholder, cashing out. And that has now unfolded.
  • Yip has entered into a SPA with fintech giant Ant Group, the operator of Alipay. The agreement has been struck at HK$3.28/share, a 17.6% premium to undisturbed. 
  • Should the SPA complete – the key condition is NDRC approval – an unconditional MGO is triggered, also at HK$3.28. The price is final.

Sinarmas Land (SML SP): Potential Outcomes as IFA Says NOT Fair but Reasonable

By Arun George

  • Sinarmas Land (SML SP) IFA opined that the Widjaja family’s S$0.31 offer is NOT fair but reasonable, as it is below the valuation range of S$0.350 to S$0.361.
  • The independent directors have recommended that shareholders accept. Due to a breach of the 10% free float requirement, the shares will be suspended at the close of the offer. 
  • There are four possible outcomes with a medium probability that Sinarmas will follow the Great Eastern Holdings (GE SP) and Boustead Projects (BOCJ SP) playbook.

Bright Smart (1428 HK): To Sell or Not to Sell?

By Osbert Tang, CFA

  • The offer price of HK$3.28 by Ant Financial is attractive – 2.9x P/B and 8.3x PER, both on 12-month forward basis. It is also appealing relative to peers.
  • Bright Smart Securities (1428 HK)‘s massive outperformance against the HSI showed its strong marketing and execution capabilities. Ant Financial will bring many synergies to it.  
  • Risk-Averse investors may take this opportunity to cash out, but we are on the long-term bull camp and prefer to hold for further upside. 

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Apr 27
0

Daily Brief Quantitative Analysis: HK Connect Flows Weekly (Apr 25th): Alibaba and more

By | Daily Briefs, Quantitative Analysis

In today’s briefing:

  • HK Connect Flows Weekly (Apr 25th): Alibaba, Tencent, Meituan, Giant Biogene, Pop Mart Intl, Xiaomi

HK Connect Flows Weekly (Apr 25th): Alibaba, Tencent, Meituan, Giant Biogene, Pop Mart Intl, Xiaomi

By Ke Yan, CFA, FRM

  • We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of April 25th.
  • The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.
  • We highlight flows for Alibaba, Tencent, Meituan, Giant Biogene, Pop Mart Intl, Xiaomi, China Mobile, Ping An Insurance, Zijin Mining.

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Apr 27
0

Daily Brief ESG: Expect Gradual Improvement in the Quality of Listed Companies as More Companies Go Private and more

By | Daily Briefs, ESG

In today’s briefing:

  • Expect Gradual Improvement in the Quality of Listed Companies as More Companies Go Private

Expect Gradual Improvement in the Quality of Listed Companies as More Companies Go Private

By Aki Matsumoto

  • Although it’ll take some time for quality of existing listed companies to improve, a gradual improvement in quality of companies is likely for the time being as more companies delist.
  • The TSE’s “request” was not only for activist investors, but also for other investors who shared the view that the stock market should not be left in the doldrums.
  • A certain number of companies that fail to meet TSE listing criteria will move to the regional stock exchanges, leading to a gradual improvement in the quality of the TSE.

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Apr 27
0

Daily Brief Thematic (Sector/Industry): APAC Healthcare Weekly (April 27)- Sillajen and more

By | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

  • APAC Healthcare Weekly (April 27)- Sillajen, Akeso, Innovent Biologics, CSL, Daiichi Sankyo, Lupin

APAC Healthcare Weekly (April 27)- Sillajen, Akeso, Innovent Biologics, CSL, Daiichi Sankyo, Lupin

By Tina Banerjee

  • SillaJen got FDA nod to expand clinical trial of BAL0891 for acute myeloid leukemia. Akeso received FDA approval for its PD-1 inhibitor penpulimab for the treatment of nasopharyngeal carcinoma.
  • Innovent Biologics got approval for limertinib in China for the first-line treatment of locally advanced or metastatic non-small cell lung cancer. CSL launches Andembry Pen for Hereditary Angioedema in Japan.
  • Daiichi Sankyo submitted indication expansion application in Japan for Enhertu for the treatment of HER2 positive advanced or recurrent solid tumors. Lupin received FDA approval for Tolvaptan Tablets.

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Apr 27
0

Daily Brief ECM: EToro IPO Preview: High Crypto Exposure and more

By | Daily Briefs, ECM

In today’s briefing:

  • EToro IPO Preview: High Crypto Exposure, CopyTrader Technology Is Not “Deep Tech”

EToro IPO Preview: High Crypto Exposure, CopyTrader Technology Is Not “Deep Tech”

By Andrei Zakharov

  • EToro Group Ltd., a social investment network and trading-app provider, plans to raise up to $400M in upcoming US IPO.
  • Israeli social trading platform was valued at ~$10B during a planned merger with a publicly-listed SPAC in 2022. However, the SPAC deal collapsed.  
  • EToro launched copy trading services in 2010 and made a big bet on crypto segment. Revenue from cryptoassets accounted for ~96% of total revenue and income in 2024.

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Apr 27
0

Daily Brief Credit: Moody’s Corporation: How Is The Management Capitalizing On Private Credit Market Demand To Up Their Game! and more

By | Credit, Daily Briefs

In today’s briefing:

  • Moody’s Corporation: How Is The Management Capitalizing On Private Credit Market Demand To Up Their Game!

Moody’s Corporation: How Is The Management Capitalizing On Private Credit Market Demand To Up Their Game!

By Baptista Research

  • Moody’s Corporation (Moody’s) reported strong financial performance in the first quarter of 2025, reflecting the resilience of its business model amidst market volatility and economic uncertainties.
  • The company achieved a record revenue of $1.9 billion, which represents an 8% year-over-year increase.
  • Both its Moody’s Investors Service (MIS) and Moody’s Analytics (MA) segments experienced 8% revenue growth.

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