Smartkarma Daily Briefs

In early February, Yageo Corporation (2327 TT) made an unsolicited bid for Shibaura Electronics (6957 JP) at ¥4,300/share. They had approached in October 2024, and continued approaches through end-January.
Shibaura’s bankers approached Minebea Mitsumi (6479 JP) in January. Due diligence, then bids. They bid ¥4,600. Not enough said the SC. Then Trump. Then ¥4,400. Now ¥4,500 accepted 9 April.
But Trump tariffs relief came 9 April US time. And the Offer Price is below the mid-point of ALL three different financial advisors. I think this is not done yet.

Shibaura Electronics (6957 JP): Minebea Mitsumi’s (6479 JP) White Knight Tender Offer at JPY4,500

Shibaura Electronics (6957 JP) announced a preconditional tender offer from Minebea Mitsumi (6479 JP) at JPY4,500 per share, a 4.7% premium to Yageo Corporation (2327 TT)’s JPY4,300 hostile offer.
The offer is scheduled to start on 23 April, ahead of Yageo’s 7 May start. The Board intends to recommend the Minebea offer and oppose the Yageo offer.
Due to its low premium to the Yageo offer, at least another bidding round is highly probable, and the Minebea offer is below the midpoint of the IFA DCF valuation.

TSMC (2330.TT; TSM.US): Brace Yourself for US Tariff! (II)

By Patrick Liao

Under the US tariffs, we have to seriously consider whether Taiwan Semiconductor (TSMC) – ADR (TSM US) can achieve 25% growth in 2015.
We have conducted two scenario analyses and anticipate a likely loss of above 8.5% in 2025 revenue for TSMC, especially related to Apple (AAPL US).
The stock price of Taiwan Semiconductor (TSMC) – ADR (TSM US) is expected to be somewhat reshuffled in the current US-China tariff environment.

PC 1Q25: 5% YoY Growth but Shipments Inflated Ahead of US Tariffs. Dream of a Refresh Cycle Continue

By Nicolas Baratte

PC units grew by 1% in 2024, accelerating to 5% YoY in 1Q25. Best performers: Apple, Lenovo. Higher shipments to the US ahead of potential import tariffs but flat end-demand.
~70% of Computers are Made in China, US consumes 25% of total PC. The supply chain is accelerating relocating US-purchased PC out of China, this should be done by end-2025.
There is a risk of over-built and over-stocking in my view if PC Brands are too optimistic on Windows 10 end-of-support and AI PC upgrades.

Plexus Corp Cuts Debt, Boosts Buybacks, & Tightens Inventory—Here’s What Inspires Our Optimism!

Plexus Corp. reported strong financial performance and strategic strides in its first quarter of the fiscal year 2025.
The company recorded robust revenue of $976 million, meeting its guidance, with performance propelled by agility in response to customer needs and commitments to improving working capital efficiency.
The revenue forecast for the full fiscal year anticipates growth across its market sectors, supported by new program ramps and share gains, despite mixed sector trends.

Sabre Corporation: Can Its Modern Technology Infrastructure & AI Integration Aid In Strengthening Competitive Position?

Sabre Corporation’s latest financial update provides a mixed outlook, reflecting both the strengths and challenges the company faces as it moves forward.
In 2024, Sabre reported notable achievements, including a 4% year-on-year revenue increase reaching $3.03 billion and a substantial 53% rise in adjusted EBITDA to $517 million, surpassing initial guidance.
The company credits its growth to steady revenue increases, cost management, and major commercial wins, all contributing to margin expansions and enhanced operational efficiency.

Shift Inc (3697 JP): 1H FY08/25 flash update

In 1H FY08/25, the company reported sales of JPY61.7bn, operating profit of JPY8.1bn, and net income of JPY4.5bn.
Software Testing Related Services segment recorded JPY39.6bn in sales, JPY14.6bn gross profit, and JPY10.5bn operating profit.
Software Development Related Services segment achieved JPY19.7bn sales, JPY5.1bn gross profit, and JPY1.6bn operating profit.

Lucror Analytics – Convertibles Brief

By Trung Nguyen

In today’s Convertibles Brief publication we comment on developments of the following high yield issuers: Lenovo
Credit markets widened yesterday, with the iTraxx X-Over up 36 bps at 428 bps.
Equities were mixed, with European bourses sliding 2.2-4.2%, as the markets closed before US President Donald Trump announced a 90-day pause on additional tariffs for all countries except China.

WingArc1st Inc (4432 JP): Full-year FY02/25 flash update

In FY02/25, revenue was JPY28.7bn (+11.5% YoY), operating profit JPY8.2bn (+12.4% YoY), and EBITDA JPY9.7bn (+12.2% YoY).
BDS sales revenue rose 13.7% YoY to JPY18.8bn, with cloud services revenue growing 18.8% YoY.
For FY02/26, the company forecasts revenue of JPY30.3bn (+5.5% YoY) and operating profit of JPY8.9bn (+8.3% YoY).

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Apr 11

Daily Brief Industrials: CJ Corp, InterGlobe Aviation Ltd, MSC Industrial Direct Co Inc, Nakamoto Packs, Aeon Delight, NEXTracker and more

By Smartkarma Daily Briefs | Daily Briefs, Industrials

In today’s briefing:

Corporate Act Amendment Takes Unexpected Turn: Watch for Holdco Momentum Plays Post-June Election
Quiddity Leaderboard NIFTY Sep25: US$1bn+ Total One-Way Flows; ADDs Strongly Outperforming DELs
MSC Industrial Direct Battles Tariffs with Bold Pricing Moves—Will It Pay Off?
Nakamoto Packs (7811 JP): Full-year FY02/25 flash update
Aeon Delight (9787 JP): Full-year FY02/25 flash update
Nextracker – Looking To Revolutionize Solar Tech With Breakthrough Products…

Corporate Act Amendment Takes Unexpected Turn: Watch for Holdco Momentum Plays Post-June Election

By Sanghyun Park

The word on the street is the Dems are banking on their candidate winning in June, then clearing the veto and pushing the Corporate Act amendment through immediately.
What seemed like a dead issue for the Corporate Act amendment has turned into a surprise, shifting market momentum and potentially impacting the Korean stock scene.
It could shift the Korean market’s focus to long-term governance improvements, targeting major holdcos like CJ, Hanwha, GS, Doosan, Mobis, SK, and Samsung C&T, with June’s election key.

Quiddity Leaderboard NIFTY Sep25: US$1bn+ Total One-Way Flows; ADDs Strongly Outperforming DELs

By Janaghan Jeyakumar, CFA

NIFTY 50 represents the 50 largest stocks listed in the National Stock Exchange (NSE) of India and the NIFTY Next 50 index tracks the next 50 largest names.
In this insight, we take a look at the names leading the race to become ADDs/DELs for these indices in the September 2025 index rebal event.
We see two changes for NIFTY 50 and five changes for NIFTY 100.

MSC Industrial Direct Battles Tariffs with Bold Pricing Moves—Will It Pay Off?

MSC Industrial Supply reported a mixed set of results for its fiscal second quarter of 2025.
The company faced challenges in the current quarter, underscored by a decline in average daily sales by 4.7% year-over-year, indicating a soft demand environment.
This decline, however, showed slight improvements towards the end of the quarter, with January and February outperforming historical trends.

Nakamoto Packs (7811 JP): Full-year FY02/25 flash update

FY02/25 results: Revenue JPY49.1bn (+10.8% YoY), operating profit JPY2.9bn (+58.2% YoY), net income JPY2.0bn (+90.1% YoY).
FY02/26 forecast: Revenue JPY52.0bn (+5.8% YoY), operating profit JPY3.0bn (+5.4% YoY), net income JPY2.0bn (flat YoY).
Dividend projections: FY02/25 JPY66.0 per share, FY02/26 JPY68.0 per share, payout ratio 30.2% (FY02/25: 29.3%).

Aeon Delight (9787 JP): Full-year FY02/25 flash update

Sales reached JPY337.9bn (+4.0% YoY), with operating profit at JPY16.4bn (+7.8% YoY), and net income JPY11.5bn (+7.6% YoY).
Sales and operating profit increased YoY across all segments except Vending Machine Services, with record highs in operating and recurring profit.
The company announced a tender offer by Aeon Co., Ltd., leading to expected delisting and no FY02/26 forecast.

Nextracker – Looking To Revolutionize Solar Tech With Breakthrough Products…

Nextracker’s third quarter fiscal year 2025 results highlight a blend of robust performance and strategic challenges.
The company achieved a 15% year-over-year revenue growth, reaching approximately $2 billion year-to-date, with third-quarter revenue standing at $679 million.
This growth is driven by strong execution across its global operations, robust demand for its solar tracker technologies, and consistent market expansion.

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Apr 11

Most Read: Seven & I Holdings, Canvest Environmental Protection Group, Shanghai Shenzhen CSI 300 Index, Shibaura Electronics, Jinhong Gas , HKBN Ltd, Posco Future M, CJ Corp, De Grey Mining and more

By Smartkarma Daily Briefs | Daily Briefs, Most Read

In today’s briefing:

7&I (3382) – FY24 Better, FY25 OK, Surprisingly Large Buyback
Canvest (1381 HK): Precondition Satisfied
China ETF Inflows & Implications: Central Huijin’s Huge Buying
Minebea Mitsumi Overbids Yageo for Shibaura Electronics (6957)
STAR Chip Index Rebalance Preview: Potential Changes in June
HKBN (1310 HK): TPG Cashes In Early
Shibaura Electronics (6957 JP): Minebea Mitsumi’s (6479 JP) White Knight Tender Offer at JPY4,500
Korea Short Selling: Biggest Changes in Shorts & Trade Performance
Corporate Act Amendment Takes Unexpected Turn: Watch for Holdco Momentum Plays Post-June Election
Quiddity Leaderboard MV Jr-Gold Miners Jun25: Flow Expectations

7&I (3382) – FY24 Better, FY25 OK, Surprisingly Large Buyback

Today, Seven & I Holdings (3382 JP) reported full-year earnings. The FY2025 guidance looks OK. Not overly exciting. Optically, it falls short, but 7&i guidance includes York only for H1.
The basic outlines of strategy in the Presentation are unchanged from the 6 March strategy report. The company seems convinced an IPO of SEI is a good thing. I’m underwhelmed.
The company also announced that it would bring forward ¥600bn of its planned 6-year ¥2trln buyback program, and execute it this year. That’s good.

Canvest (1381 HK): Precondition Satisfied

Grandblue Environment Co A (600323 CH) has satisfied the precondition related to its privatisation offer for Canvest Environmental Protection Group (1381 HK).
The offer remains attractive despite the re-rating of peers since announcing the deal. The vote risk is low as the two shareholders holding blocking stakes will be supportive.
This is a done deal. At the last close, the gross/annualised spread for a mid-June payment is 3.8%/13.0%.

China ETF Inflows & Implications: Central Huijin’s Huge Buying

Nearly US$22bn has flowed into mainland China listed ETFs over the last 3 trading days, reversing outflows that started in mid February.
Central Huijin has announced that it will be increasing its ETF holdings to maintain smooth operation of China’s capital markets. The rest of the National Team will be buying too.
There are multiple implications of the huge ETF creations in a short time frame and a reversal of flows will lead to a reversion in a bunch of trades.

Minebea Mitsumi Overbids Yageo for Shibaura Electronics (6957)

In early February, Yageo Corporation (2327 TT) made an unsolicited bid for Shibaura Electronics (6957 JP) at ¥4,300/share. They had approached in October 2024, and continued approaches through end-January.
Shibaura’s bankers approached Minebea Mitsumi (6479 JP) in January. Due diligence, then bids. They bid ¥4,600. Not enough said the SC. Then Trump. Then ¥4,400. Now ¥4,500 accepted 9 April.
But Trump tariffs relief came 9 April US time. And the Offer Price is below the mid-point of ALL three different financial advisors. I think this is not done yet.

STAR Chip Index Rebalance Preview: Potential Changes in June

There could be 1 constituent change for the STAR Chip Index at the June rebalance. There will also be a few capping changes.
Estimated one-way turnover is 2.1% resulting in a round-trip trade of CNY 1.04bn (US$141m). Passives need to trade between 0.65-1.65x ADV in the potential changes.
Jinhong Gas (688106 CH) is also a potential delete from the STAR100 Index and that will lead to increased passive selling in the stock.

HKBN (1310 HK): TPG Cashes In Early

Back in December, China Mobile (941 HK) made a pre-conditional HK$5.23/share voluntary Offer for HKBN (1310 HK). The wild card is whether I Squared launches a counter-proposal.
This transaction has no shortage of intriguing developments. Last month, MBK mysteriously converted its VLNs. Now TPG has entered into an SPA with Mobile to sell its 15.46% stake.
IF I Squared were to make a counter-proposal, I doubt it would secure the necessary regulatory approvals. Evidently TPG is not waiting around to find out.

Shibaura Electronics (6957 JP): Minebea Mitsumi’s (6479 JP) White Knight Tender Offer at JPY4,500

Shibaura Electronics (6957 JP) announced a preconditional tender offer from Minebea Mitsumi (6479 JP) at JPY4,500 per share, a 4.7% premium to Yageo Corporation (2327 TT)’s JPY4,300 hostile offer.
The offer is scheduled to start on 23 April, ahead of Yageo’s 7 May start. The Board intends to recommend the Minebea offer and oppose the Yageo offer.
Due to its low premium to the Yageo offer, at least another bidding round is highly probable, and the Minebea offer is below the midpoint of the IFA DCF valuation.

Korea Short Selling: Biggest Changes in Shorts & Trade Performance

The resumption of short selling in Korea came at a good time for investors, giving them some additional tools to manage market volatility.
Short interest has increased from 0.17% to 0.23% of market cap for the KOSPI market and from 0.46% to 0.63% for the KOSDAR market.
The KOSPI/KOSDAQ ratio has reverted a bit on profit taking, and the forecast index deletions have recovered a bit but should continue to see increase short interest.

Corporate Act Amendment Takes Unexpected Turn: Watch for Holdco Momentum Plays Post-June Election

By Sanghyun Park

The word on the street is the Dems are banking on their candidate winning in June, then clearing the veto and pushing the Corporate Act amendment through immediately.
What seemed like a dead issue for the Corporate Act amendment has turned into a surprise, shifting market momentum and potentially impacting the Korean stock scene.
It could shift the Korean market’s focus to long-term governance improvements, targeting major holdcos like CJ, Hanwha, GS, Doosan, Mobis, SK, and Samsung C&T, with June’s election key.

Quiddity Leaderboard MV Jr-Gold Miners Jun25: Flow Expectations

The MV Jr-Gold Miners index represents the performance of small-cap gold and silver mining companies listed around the world.
This index is reviewed semiannually in March and September. There will be no index changes for the June 2025 index rebal event but there will be capping flows.
We expect one-way flows of US$81mm for June 2025 which translates to a turnover of 1.4%.

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Apr 11

Daily Brief Consumer: Fast Retailing, Suzuki Motor, Goldlion Holdings, Chagee Holdings, SGX Rubber Future TSR20, BYD, Sonos Inc, Lifeway Foods, Grocery Outlet Holding Corp and more

By Smartkarma Daily Briefs | Consumer, Daily Briefs

In today’s briefing:

Fast Retailing (9983) | Japan Delivers as Tariffs Start to Impact
Suzuki Motor Placement Updates – Relative Correction Has Been Decent so Far. But Lacks Buyback
Goldlion Holdings (533 HK): An Attractive Spread Ahead of the Vote on 9 May
Goldlion Holdings (533 HK): 9th May Vote On Tsang Family’s Offer
Chagee Holdings IPO Valuation Analysis
Tariff Part II: Canada-Mexico Web Ensnares US; USTMA Projects Higher Volume
[BYD Company (1211 HK, BUY, TP HK$400) TP Change]: Better than Expected ASP Is the Positive Surprise
Sonos Inc.: Product Innovation & Market Expansion Is The ONLY Way It Can Thrive!
Exploring Strategic Reviews: Key Opportunities in Biopharma and Food Sectors
Grocery Outlet: The Top 6 Influences on Its Performance for 2025 & The Future!

Fast Retailing (9983) | Japan Delivers as Tariffs Start to Impact

By Mark Chadwick

Strong Q2 beat: Revenue rose 14% YoY and OP jumped 33%, driven by Japan strength and solid winter sales, offsetting China’s continued weakness.
Guidance tweak: FY business profit raised to ¥540bn, though H2 expectations effectively lowered due to anticipated US tariff impact.
US expansion continues: 69 stores now open; North America accounts for 7.5% of sales, with future margin mitigation via supply chain shifts and EU/Asia growth.

Suzuki Motor Placement Updates – Relative Correction Has Been Decent so Far. But Lacks Buyback

By Sumeet Singh

Tokio Marine Holdings (8766 JP) and Sompo Holdings (8630 JP) aim to raise around US1.15bn (including over-allotment) via selling around 5% of Suzuki Motor (7269 JP).
While Suzuki doesn’t have much direct exposure to the US markets, its shares had corrected in line with other auto players going into the deal launch.
In this note, we compare the deal to some of the past deals and talk about the updates since our last note.

Goldlion Holdings (533 HK): An Attractive Spread Ahead of the Vote on 9 May

Goldlion Holdings (533 HK)’s IFA considers Mr Tsang’s HK$1.5232 per share offer fair and reasonable. The vote is on 9 May.
The key condition is the scheme approved by at least 75% disinterested shareholders (<10% disinterested shareholders rejection). FMR holds a blocking stake but should be supportive.
The offer is reasonable compared to peer multiples and historical trading ranges. At the last close and for the 10 July payment, the gross/annualised spread is 4.3%/19.0%.

Goldlion Holdings (533 HK): 9th May Vote On Tsang Family’s Offer

On the 17th December 2024, Goldlion Holdings (533 HK), an apparel manufacturer/distributor, announced an Offer, by way of a Scheme, from the Tsang family (2.95% stakeholder), for shares not held.
The Tangs are offerings $1.5232/share (declared final), a 24.85% premium to last price, but a 71% premium to undisturbed. Despite the very low price-to-book multiple, this transaction looks done.
The Scheme Doc is now out, with a Court Meeting on the 9th May, with payment on or before the 10th July. The IFA (Altus Capital) says “fair & reasonable“.

Chagee Holdings IPO Valuation Analysis

By Douglas Kim

Our base case valuation of Chagee Holdings is target price of $46.7 per share, representing 67% higher than the high end of the IPO price range ($28 per share).
Our base case valuation is based on a P/E of 21.4x on our estimated net profit of 2.9 billion RMB in 2025.
We used a very conservative valuation multiple, mainly due to the extremely high macro risks related to the ongoing tariff dispute between China and the United States.

Tariff Part II: Canada-Mexico Web Ensnares US; USTMA Projects Higher Volume

By Vinod Nedumudy

Components crossing US–Mexico–Canada corridor face disruption
Reshoring production to US would involve multi-year lead times
USTMA expects U.S. tire shipments of 340.4 million units in 2025

[BYD Company (1211 HK, BUY, TP HK$400) TP Change]: Better than Expected ASP Is the Positive Surprise

By Eric Wen

BYD reported C1Q25 net profit up 86%-119% YoY, with the midpoint exceeds our estimate/consensus by 12%/20%.
We believe this driven by better ASP mix of its products, among other factors;
We believe a possible China-EU deal on EV market access can be positive for BYD. We raise the TP to HK$400 and place BYD back to TOB BUY.

Sonos Inc.: Product Innovation & Market Expansion Is The ONLY Way It Can Thrive!

By Special Situation Investments

Sonos, a prominent player in the home audio industry, recently shared its financial performance for the first fiscal quarter of 2025.
The interim CEO, Tom Conrad, highlighted several strategic changes and challenges faced by the company.
These insights provide a nuanced basis for evaluating the company’s future investment potential.

Exploring Strategic Reviews: Key Opportunities in Biopharma and Food Sectors

Lifeway Foods (LWAY) faces a pending takeover by Danone, with a potential board overhaul and strategic acquisition synergies.
Liquidia (LQDA) anticipates FDA approval for Yutrepia, challenging UTHR’s monopoly, with potential valuation gap closure post-commercialization.
Sage Therapeutics (SAGE) received a buyout offer from Biogen, with ongoing strategic review and potential for increased offer price.

Grocery Outlet: The Top 6 Influences on Its Performance for 2025 & The Future!

Grocery Outlet recently held its fourth quarter and full-year 2024 earnings call, highlighting several key outcomes and strategic initiatives.
The performance in Q4 showed a net sales increase of 10.9%, reaching $1.1 billion, with comparable store sales climbing 2.9%.
This growth was primarily driven by a 3% rise in customer visits, although the average basket size remained flat.

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Apr 10

Daily Brief Thematic (Sector/Industry): Ohayo Japan | S&P 500 Surges 9.5%! and more

By Smartkarma Daily Briefs | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

Ohayo Japan | S&P 500 Surges 9.5%!
US Tariff Impact on APAC Healthcare: Focus Country- JAPAN
The Stocks to Own in China – Vol. 35
China & HK Strategy: Which Stocks Will Thrive?
Japan Morning Connection: Trump Pulls off One of the Greatest Ruses of All Time
The Stocks to Own in Asia – Vol. 48
The Stocks to Own in ASEAN – Vol. 50
Real Asset Chartbook: The First Edition
What’s New(s) in Amsterdam – 9 April (AMG Critical Materials | SBM Offshore | NX Filtration)

Ohayo Japan | S&P 500 Surges 9.5%!

By Mark Chadwick

U.S. stocks staged a historic rally after President Donald Trump announced a 90-day pause on most reciprocal tariffs
Tech and retail stocks led the comeback, with Apple rising over 15%, Nvidia nearly 19%, Walmart 9.6%, and Tesla more than 22%
Seven &i Holdings plans to repurchase up to 600 billion yen of its shares, acquiring up to 400 million shares (15.4% of issued shares) by end Feb, 2026

US Tariff Impact on APAC Healthcare: Focus Country- JAPAN

By Tina Banerjee

U.S. has implemented a universal baseline tariff of 10%, effective April 5. Japan faces 24% reciprocal tariff from April 9.
In 2023, Japan exported pharmaceutical products worth $6.34B (~43% of total exports) to the U.S.
Japanese pharma and medical devices companies have significant revenue exposure to the U.S.

The Stocks to Own in China – Vol. 35

By Dr. Andrew Stotz, CFA

We highlight 10 stocks in China that look interesting to us based on our FVMR Methodology
Portfolio changes: Four stocks remain, six new join the fray
Since inception, it has gained 150% versus the CSI 300 Index’s return of 53%

China & HK Strategy: Which Stocks Will Thrive?

By Osbert Tang, CFA

Trump’s “reciprocal tariffs” have led to over 10% fall in the Hong Kong market, but there are some names that only came down by 3.2% on average.
Their characteristics are: 1.) domestically focused, 2.) net cash position, 3.) secure demand, 4.) consumption downgrade beneficiary, and 5.) good dividends.
These stocks are Xinhua Winshare (811 HK), Lonking Holdings (3339 HK), Kunlun Energy (135 HK), Mixue Group (2097 HK), and China East Education (667 HK).

Japan Morning Connection: Trump Pulls off One of the Greatest Ruses of All Time

By Andrew Jackson

Oversold tech/SPE/AI surging after Trump delayed reciprocal tariffs on all but China, with the SOX up the most of all time.
Expect similar moves with oversold tech beta likely to open >+10%.
Banks and life insurance should continue to fare well given the persistently high yields, and names with high export ratios to the US.

The Stocks to Own in Asia – Vol. 48

By Dr. Andrew Stotz, CFA

We highlight 14 stocks in Asia that look interesting to us based on our FVMR methodology
Portfolio changes: Two stock remains, 12 stocks added into portfolio
Since its inception, it has generated a before-fee total return of 200% versus the MSCI Asia ex Japan of 77%

The Stocks to Own in ASEAN – Vol. 50

By Dr. Andrew Stotz, CFA

We highlight 14 stocks in ASEAN that look interesting to us based on our FVMR Methodology
Portfolio changes: Four stocks remain, 10 stocks added into the portfolio
Since its inception, the portfolio has generated a before-fee total return of 223% versus MSCI ASEAN’s 30%

Real Asset Chartbook: The First Edition

By Massif Capital Research

This is the first edition of the Real Asset Chartbook.

This document arose from an internal need at Massif Capital to consolidate and streamline our process of monitoring liquid real asset markets. It remains a work in progress but is extremely useful in its present state.

The Chartbook will be released weekly, on Fridays, after the market closes.

What’s New(s) in Amsterdam – 9 April (AMG Critical Materials | SBM Offshore | NX Filtration)

By The IDEA!

AMG decided to make a capital investment of USD 15m to establish an aluminothermic production facility to manufacture chrome metal in the United States.
The facility, with an annual capacity of up to 6,500 tons, will be located next to AMG Titanium’s facility in New Castle, Pennsylvania.
AMG expects the facility to be operational in 26Q1. Comment | AMG Chrome is a major producer of chrome metal in the UK.

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Apr 10

Daily Brief ECM: LG Electronics India IPO: The Bull Case and more

By Smartkarma Daily Briefs | Daily Briefs, ECM

In today’s briefing:

LG Electronics India IPO: The Bull Case
Samsung SDI: Rights Offering Capital Raise Amount Lowered by 14% to 1.7 Trillion Won
Jiangsu Hengrui Pharma A/H Listing – Recent Updates and Thoughts on A/H Premium
Pre-IPO Chagee Holdings – Some Points Worth the Attention
Jain Resource Recycling Pre-IPO Tearsheet
Runwal Enterprises Ltd Pre-IPO Tearsheet

LG Electronics India IPO: The Bull Case

LG Electronics India (123D IN)/LGEIL, a subsidiary of LG Electronics (066570 KS), aims to raise up to US$1.5 billion through a secondary offering (15% of outstanding shares).
According to Redseer, as of 30 June 2024, LGEIL was the market leader in India in major home appliances and consumer electronics (excluding mobile phones) in terms of volume.
The bull case rests on a strong market position, solid revenue growth, top-tier operating and FCF margin profile.

Samsung SDI: Rights Offering Capital Raise Amount Lowered by 14% to 1.7 Trillion Won

By Douglas Kim

Samsung SDI (006400 KS) has lowered the rights offering capital raise amount by 14% to 1.7 trillion won, mainly due to the recent carnage in the global equity markets.
The expected rights offering price has been lowered to 146,200 won, which is 14.9% lower than current price.
We remain negative on Samsung SDI’s rights offering capital raise mainly due to shares dilution risk. We also remain concerned that the weak demand for EVs globally could last longer.

Jiangsu Hengrui Pharma A/H Listing – Recent Updates and Thoughts on A/H Premium

By Sumeet Singh

Jiangsu Hengrui Medicine (600276 CH) (JHP), a China-based pharmaceutical company, aims to raise around US$2bn in its H-share listing.
JHP has been ranked as one of the global Top 50 pharmaceutical companies by Pharm Exec for six consecutive years since 2019.
We have looked at the company’s past performance in our previous note. In this note, we talk about the recent updates and provide our thoughts on the possible A/H premium.

Pre-IPO Chagee Holdings – Some Points Worth the Attention

By Xinyao (Criss) Wang

The main reason behind declining performance is related to the increase in regional market density brought about by newly opened teahouses. Franchisees would be more cautious about investing in Chagee.
With the passage of time and the declining same store GMV, the low teahouse closure rate will gone. Product strategy of “flagship product + classic basics ” also has risks.
Based on our forecast of 2025 net profit of about RMB3 billion (or US$400 million) and US IPO market value of US$5 billion, P/E is about 12.5x.

Jain Resource Recycling Pre-IPO Tearsheet

By Akshat Shah

Jain Resource Recycling (2300699D IN) is looking to raise about US$234m in its upcoming India IPO. The deal will be run by ICICI, Motilal, DAM and PL Capital.
The company is primarily focused on manufacturing of non-ferrous metal products by recycling of non-ferrous metal scrap. It is also engaged in trading of non-ferrous metals and other commodities.
According to CRISIL, it was the largest and fastest-growing non-ferrous metal recycling business, in terms of revenue for FY22-24 in India.

Runwal Enterprises Ltd Pre-IPO Tearsheet

By Rosita Fernandes

Runwal Enterprises Limited (2300329D IN) (REL) is planning to raise about US$117m through its upcoming India IPO. The lead bookrunners for the deal are ICICI, Jefferies.
REL is a real estate developer engaged across the full spectrum of real estate, with a focus on residential (affordable to luxury), commercial spaces, retail malls, and educational buildings.
As per JLL Report, between Jan 19 and Sept 24, Runwal Enterprises ranked 2nd in Mumbai for both new launches (5.69%) and sales (5.25%).

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Apr 10

Daily Brief Equity Bottom-Up: Taiwan Dual-Listings Monitor: TSMC Spread Near Short Level; ASE & ChipMOS Spreads Good Short Levels and more

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

In today’s briefing:

Taiwan Dual-Listings Monitor: TSMC Spread Near Short Level; ASE & ChipMOS Spreads Good Short Levels
Shimano (7309) | Gears Grinding
A Pair Trade Between DL Holdings and DL E&C
Nvidia Is Getting Hit by Tariffs—But Here’s How It Plans to Fight Back!
Conagra Brands: Powering Through Inflation with Bold Pricing & Sourcing Moves!
Concentrix Corporation: Expanding Client Base & Capitalizing On Consolidation Opportunities…
Lions Gate Entertainment Strikes Gold with New TV Hits & Bold Digital Expansion!
Intel’s High-Stakes Reboot: Can the TSMC Tie-Up and Lip-Bu Tan’s Strategy Save the Chip Giant?
CLEAR Secure: The Biometric Technology Advancements & Critical Growth Enablers!
Daiseki Co Ltd (9793 JP): Full-year FY02/25 flash update

Taiwan Dual-Listings Monitor: TSMC Spread Near Short Level; ASE & ChipMOS Spreads Good Short Levels

By Vincent Fernando, CFA

TSMC: +18.9% Premium; Soon at a Good Level to Short the Spread
ASE: +6.5% Premium; Good Level to Short the Spread Given Trading Range Breakdown
ChipMOS: +6.6% Premium; 2% And Higher Good Level to Short the Spread

Shimano (7309) | Gears Grinding

By Mark Chadwick

US tariffs could sharply cut Shimano’s H2 operating profit by up to 57%, despite limited direct exposure, due to opaque supply chains via China and Taiwan.
Valuation would look stretched at 25x EV/EBIT versus historical 20x, if earnings fall short of current guidance.
Shimano’s ¥530bn net cash pile offers room to boost shareholder returns through buybacks or dividends.

A Pair Trade Between DL Holdings and DL E&C

By Douglas Kim

In this insight, we discuss a pair trade between DL Holdings Co (000210 KS) (go long) and DL E&C (375500 KS) (go short).
In the past three months, DL Holdings’ share price is down 9.9% versus DL E&C which is up 21%. We believe this gap has become too excessive.
The shares sold short volume/total traded volume ratio is more than double for DL E&C versus DL Holdings from 31 March to 9 April.

Nvidia Is Getting Hit by Tariffs—But Here’s How It Plans to Fight Back!

The semiconductor sector has been rattled by a wave of tariff escalations, with Nvidia at the center of attention.
President Donald Trump’s recent imposition of steep new tariffs—34% on imports from China and 32% on Taiwan—sent shockwaves across the global technology industry.
While semiconductors were initially exempted from the levies, the ambiguity in policy messaging and the potential for future inclusion have raised investor concerns.

Conagra Brands: Powering Through Inflation with Bold Pricing & Sourcing Moves!

Conagra Brands recently reported its third-quarter fiscal 2025 financial results.
A nuanced analysis reveals both strengths and challenges the company is navigating in a dynamic macroeconomic environment.
On the positive side, Conagra Brands highlighted robust consumer demand for its products.

Concentrix Corporation: Expanding Client Base & Capitalizing On Consolidation Opportunities…

Concentrix Corporation presented a mixed overview of its performance for the first quarter of fiscal 2025, achieving revenue growth and profitability ahead of guidance, yet facing strategic and operational challenges.
On the positive side, Concentrix reported a solid demand environment, with a particular emphasis on the growing adoption of their GenAI solutions across its client base, claiming one of the largest scales in global deployments of such technology.
The company emphasized its strategic focus on integrating AI solutions and expanding its business portfolio to deliver value across a broader client base.

Lions Gate Entertainment Strikes Gold with New TV Hits & Bold Digital Expansion!

Lionsgate secured a solid performance in the third quarter of fiscal 2025, demonstrating resilience in a challenging operating environment.
The Motion Picture segment was particularly strong, highlighted by the successful conversion of three mid-budget films into profitable ventures.
This performance underscores Lionsgate’s ability to effectively manage mid-range budget productions, capitalizing on steady box office showings, robust business models, and efficient execution.

Intel’s High-Stakes Reboot: Can the TSMC Tie-Up and Lip-Bu Tan’s Strategy Save the Chip Giant?

Intel is navigating one of the most pivotal moments in its corporate history as new CEO Lip-Bu Tan begins implementing a series of structural reforms aimed at reversing the chipmaker’s prolonged decline.
In recent weeks, a series of bold announcements and market-moving headlines have brought Intel’s turnaround efforts back into the spotlight.
The most notable development is a tentative joint venture with Taiwan Semiconductor Manufacturing Company (TSMC), where TSMC is expected to take a 20% stake in Intel’s loss-making manufacturing business in exchange for sharing advanced foundry techniques.

CLEAR Secure: The Biometric Technology Advancements & Critical Growth Enablers!

CLEAR, known for its identity verification platform, reported its fiscal fourth quarter and full-year 2024 results demonstrating both opportunities and challenges.
The company continues to expand its footprint in the travel sector, with a notable presence in 73% of U.S. airports through 166 lanes nationwide.
The rollout of the NextGen Identity technology, including innovative systems such as EnVe’s (enrollment and verification Pods), has been a focal point—improving member throughput and enhancing the customer experience significantly.

Daiseki Co Ltd (9793 JP): Full-year FY02/25 flash update

Daiseki’s FY02/25 sales declined 2.8% YoY to JPY67.3bn, exceeding the forecast of JPY66.0bn.
Operating profit fell 3.3% YoY to JPY14.3bn, impacted by TOB-related expenses and heavy snowfall.
FY02/26 forecast: Sales JPY70.0bn (+4.0% YoY), operating profit JPY15.7bn (+9.7% YoY), OPM 22.4% (+1.1pp YoY).

💡 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

Apr 10

Daily Brief Credit: Lucror Analytics – Morning Views Asia and more

By Smartkarma Daily Briefs | Credit, Daily Briefs

In today’s briefing:

Lucror Analytics – Morning Views Asia

Lucror Analytics – Morning Views Asia

By Leonard Law, CFA

In today’s Morning Views publication we comment on developments of the following high yield issuers: Greentown China
In the US, the NFIB small business optimism index declined to 97.4 (99.0 e / 100.7 p), just below the 51-year average of 98.
US President Donald Trump’s tariffs are set to take effect from midnight ET today, according to the US Customs and Border Protection.

💡 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

Apr 10

Daily Brief Event-Driven: 7&I (3382) – FY24 Better and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

7&I (3382) – FY24 Better, FY25 OK, Surprisingly Large Buyback
CK Hutch (1 HK): Back To Square One
USTR Hearings on Section 301 China Maritime Dominance – Fees on Chinese Ships
HKBN (1310 HK): China Mobile Agrees to Acquire TPG’s Stake
China ETF Inflows & Implications: Central Huijin’s Huge Buying
Abacus Storage (ASK AU): Kirsh/Public Storage Buck Market Volatility With NBIO
HKBN (1310 HK): TPG Cashes In Early
BWGI’s Tender Offer for Verallia
Trial Purchase of Seiyu Creates New Japanese Retail Power

7&I (3382) – FY24 Better, FY25 OK, Surprisingly Large Buyback

Today, Seven & I Holdings (3382 JP) reported full-year earnings. The FY2025 guidance looks OK. Not overly exciting. Optically, it falls short, but 7&i guidance includes York only for H1.
The basic outlines of strategy in the Presentation are unchanged from the 6 March strategy report. The company seems convinced an IPO of SEI is a good thing. I’m underwhelmed.
The company also announced that it would bring forward ¥600bn of its planned 6-year ¥2trln buyback program, and execute it this year. That’s good.

CK Hutch (1 HK): Back To Square One

The irony is that CKH (1 HK)‘s Panama-port sale was probably prompted, at least in part, by a desire to get out of a situation which was becoming increasingly political.
Instead, it has thrust the company right into the heart of it. And the share price has now given up all of its initial gains. And then some.
After Panama’s Attorney General recently determined CK Hutchison’s concessions were unconstitutional, the Comptroller-General has now announced that an audit had found “many breaches” of the concession.

USTR Hearings on Section 301 China Maritime Dominance – Fees on Chinese Ships

The original issues were discussed in depth in The USTR’s New “Proposed Actions” For Section 301 Investigation on China’s Maritime/Shipping Sectors (now unpaywalled). Hearings took place 24-26 March 2025.
The hearings were long, and comments were predictable. Those supporting the measures offered evidence which was simply incorrect. Those against tried. Post-hearing comments were due 2 April.
We don’t yet know what will happen, but if they stay in place, starting 17 April, US exports of grain/pulses, coal, etc will suffer. Imports will see higher costs too.

HKBN (1310 HK): China Mobile Agrees to Acquire TPG’s Stake

China Mobile (941 HK) has entered a share purchase agreement to acquire TPG’s HKBN Ltd (1310 HK) shares and vendor loan note conversion shares by 28 November.
On completion, TPG will be released from its irrevocable, which has a competing offer clause. China Mobile’s agreement signals its expectation that I Squared will launch a competing proposal.
The agreement will not change I Squared’s approach as it would not negatively impact regulatory approvals (a key risk) or prevent it from meeting a 50% minimum tendering condition.

China ETF Inflows & Implications: Central Huijin’s Huge Buying

Nearly US$22bn has flowed into mainland China listed ETFs over the last 3 trading days, reversing outflows that started in mid February.
Central Huijin has announced that it will be increasing its ETF holdings to maintain smooth operation of China’s capital markets. The rest of the National Team will be buying too.
There are multiple implications of the huge ETF creations in a short time frame and a reversal of flows will lead to a reversion in a bunch of trades.

Abacus Storage (ASK AU): Kirsh/Public Storage Buck Market Volatility With NBIO

Ki Corporation and Public Storage (PSA US) together announced a NBIO, by way of a Scheme, to acquire all of the outstanding securities of Abacus Storage (ASK AU) not held.
The indicative offer of A$1.47/stapled security is a 26.7% premium to undisturbed and ~8% discount to the latest NTA/security. Nathan Kirsh directly/indirectly holds a 59.47% stake in ASK.
Trading at a gross/annualised spread of 6.9%/10.9%, assuming late Nov completion. That’s tight given timing risk, and terms not being firm.

HKBN (1310 HK): TPG Cashes In Early