Smartkarma Daily Briefs

Eight months on from the Tender Offer which changed the shape of the shareholder register, Sun Corp (6736 JP) is as cheap to its main asset as it was before.
Sun Corp is cheap to its holding in Cellebrite DI (CLBT US). How cheap depends on the form and structure of its eventual exit.
Understanding what the options are (and the dynamics around hedging/exposure) is worthwhile.

A/H Premium Tracker (To 21 Mar 2025): AH Premia Still Falling; Expect Curve Torsion or AH Widening

AH Premia continue to fall. Spread curve torsion was a barbell this week. Narrow and wide spreads see Hs outperform. Middling spreads outperform less.
To me, warning signs are flashing on spreads. They are at their narrowest in 5yrs and they are volatile, though volatility is coming down.
Lots of spreads see the HA premium less than 15%. That is historically tight.

Weekly Deals Digest (23 Mar) – CK Hutchison, Canvest, ENN Energy, HKBN, Fengxiang, Spartan, DN Sols

A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
ECM developments: DN Solutions (298440 KS) seeks to raise US$1.1 billion in a KRX IPO.
Event-Driven developments: CK Hutchison Holdings (1 HK), Canvest Environmental Protection Group (1381 HK), ENN Energy (2688 HK), HKBN Ltd (1310 HK), Shandong Fengxiang (9977 HK), Spartan Resources (SPR AU).

Merger Arb Mondays (24 Mar) – HKBN, ESR, Canvest, Vesync, Seven & I, Proto, Makino, Spartan

We summarise the latest spreads and newsflow of merger arb situations we cover across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Philippines, Thailand and Chinese ADRs.
Highest spreads: Seven & I Holdings (3382 JP), OneConnect Financial Technology (OCFT US), Insignia Financial (IFL AU), Smart Share Global (EM US), Soundwill Holdings (878 HK).
Lowest spreads: Makino Milling Machine Co (6135 JP), Shibaura Electronics (6957 JP), Domain Holdings Australia (DHG AU), Tonami Holdings (9070 JP), PointsBet Holdings (PBH AU).

PC Partners (1263 HK): SGX Primary Listing Justified To Maintain NVIDIA Supply

By David Blennerhassett

On the 18th June 2024, PC Partner (1263 HK)‘s board said it was considering an SGX listing, by way of introduction, and applying for the withdrawal of the HKEx listing.
A 30th August 2024 announcement provided clarity on a step-by-step approach for the HKEx withdrawal. A secondary listing on the SGX was established on the 15th November.
The next step is to establish a dual-primary listing in Singapore. Then withdraw the HKEx listing. The key driver behind this exercise is ensure the uninterrupted supply of NVIDIAs GPUs.

Market Movers: Key Dates at a Glance (March 24-30)

By Gaudenz Schneider

India: Index changes for Nifty indices will take place. Multiple option expiries are scheduled, impacting stocks and indices such as the NIFTY 50 Index, and the SENSEX Index.
Asia-Pacific: Key events include Hong Kong’s earnings week and Tokyo CPI release, while Australia reports its Monthly CPI indicator.
USA: Significant releases include the final Q4 2024 GDP figures and the PCE Price Index, the Fed’s preferred inflation gauge.

Weekly Update (ANGI, IAC, SNRE)

By Richard Howe

On March 31, 2025, IAC Inc (IAC) will spin off Angi Inc (ANGI). The first day of trading will be April 1st.
Transaction Structure: The spin-off is designed to be tax-free, providing IAC shareholders with direct ownership of Angi. This move will eliminate Angi’s dual-class share structure, transitioning to a one share/one vote system.
Distribution Ratio: IAC shareholders will receive approximately 0.5178 shares of Angi Class A common stock for each IAC share they hold. This ratio accounts for a planned 1-for-10 reverse stock split of Angi’s shares, effective March 24, 2025.

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Mar 24

Daily Brief Equity Bottom-Up: Meituan (3690 HK): 4Q24 and more

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

In today’s briefing:

Meituan (3690 HK): 4Q24, High Growth and Higher Margin, 60% Upside
China Merchants Port (144 HK): Will It Have a Role in CKH’s Port Sale?
Taiwan Dual-Listings Monitor: TSMC Headroom Increases Again; ASE at Discount a Long Opportunity
Micron. HBM Gets Even Better, NAND Gets Even Worse
China Healthcare Weekly (Mar.23)-Fosun Pharma Sells United Family Healthcare, MNC’s Inflection Point
ENN Energy (2688 HK): Privatisation or What? A Look at the Valuations
Foxconn’s Huge EV Bet Pays Off: Key Mitsubishi Win Could Spark Additional Automaker Deals to Come
Fu Shou Yuan (1448.HK) – 2025 Outlook May Remain Sluggish Despite the Ugly 2024 Results
Workman Fixes the Big Problem: Colors Replaces Workman Joshi
Miniso: Undeterred by Tariffs. IP-Strategy, Global Expansion on Track. Value Buy

Meituan (3690 HK): 4Q24, High Growth and Higher Margin, 60% Upside

By Ming Lu

In 4Q24, Meituan’s revenue growth rate was 20% YoY with all businesses rising.
The operating margin improved to 8.8% in 4Q24 versus about zero in 4Q23.
We set an upside of 61% and a price target of HK$270. Buy.

China Merchants Port (144 HK): Will It Have a Role in CKH’s Port Sale?

China Merchants Port (144 HK) may potentially play a role in CK Hutchison Holdings (1 HK)‘s port portfolio disposal should the mainland government want to step in.
While CMPH’s size is small relative to the port portfolio, its parent China Merchants Group and sister China Merchants Bank H (3968 HK) can easily facilitate such a transaction.
Having the portfolio in the hands of mainland company is desirable to the Chinese government. Even if CMPH has no role, its 7.6x PER and 6% yield are attractive.

Taiwan Dual-Listings Monitor: TSMC Headroom Increases Again; ASE at Discount a Long Opportunity

TSMC: +20% Premium; Wait for Higher Premium Before Shorting, ADR Headroom Has Increased Further
UMC: -1.6% Discount; Wait for Lower Discount Before Going Long
ASE: -0.1% Discount; Discounts Are Good Level to Long the Spread Given Maxed Headroom

Micron. HBM Gets Even Better, NAND Gets Even Worse

By William Keating

Micron this week reported revenues of $8.1 billion, down 8% QoQ but up 38% YoY, and at the top end of the guided range
Micron is expecting to reach an annual run rate of $7.8 billion by Q425. Wow!
NAND is headed for yet another downturn after six quarters of sequential growth.

China Healthcare Weekly (Mar.23)-Fosun Pharma Sells United Family Healthcare, MNC’s Inflection Point

By Xinyao (Criss) Wang

Given new policy recommendations, it is only a matter of time before HPV vaccination is included in the national immunization program, which is detrimental to HPV vaccine companies.
MNCs have seen a inflection point in performance growth in 2024 in China. Although VBP/NRDL negotiation are negative factors, is it also due to any consideration to withdraw from China?
Fosun Pharma has agreed to sell its entire stake in United Family Healthcare to Calcite Gem Investments Group for US$124.1 million. We shared our views about the deal.

ENN Energy (2688 HK): Privatisation or What? A Look at the Valuations

ENN Energy (2688 HK) has suspended trading. The possibilities include privatisation, third-party offer, increase in stake by ENN Natural Gas (600803 CH), and a change in control.
It trades on 1.16x 12-month forward P/B, vs. 5-year average of 2.42x and 1.31x since 2024. Given the lower forward ROE, it is difficult to return to the 5-year average.
For PER, it should be higher than China Gas Holdings (384 HK) but lower than CR Gas (1193 HK). At 10.8x (average of the two), it equates to HK$74.26.

Foxconn’s Huge EV Bet Pays Off: Key Mitsubishi Win Could Spark Additional Automaker Deals to Come

Mitsubishi Motors plans to outsource EV production to Foxconn, signaling the most significant commercial validation of Foxconn’s MIH EV platform to date.
While Foxconn’s AI server manufacturing is currently the company’s strongest growth driver, its EV strategy is increasingly gaining credibility as a second long-term pillar.
Foxconn — Structural Long. We see depressed share price as buying opportunity. Mitsubishi contract win increases the probability for additional major OEM production partnership wins this year for Foxconn.

Fu Shou Yuan (1448.HK) – 2025 Outlook May Remain Sluggish Despite the Ugly 2024 Results

By Xinyao (Criss) Wang

Fu Shou Yuan had a sharp decline in performance in 2024. The performance in recent years has often missed management guidance, which makes us question the integrity of management.
The “crisis” of Fu Shou Yuan has evolved from a short-term headwind to the failure of its long-term business model. Good dividends cannot conceal the problem of gloomy outlook.
Valuation logic is undergoing a transformation – from a leading company with “high growth/stable cash flow” to a struggling company with “weak growth/questionable profit model”. 2025 performance may remain lower-than-expected.

Workman Fixes the Big Problem: Colors Replaces Workman Joshi

By Michael Causton

Workman’s slower same-store growth can be blamed on its shift to mass market fashion and the choice of Workman Joshi as a banner, putting off male customers.
The outdoor and workwear retailer has now acknowledged the misstep and will rebrand the chain as Workman Colors while adjusting merchandise back to more apparel basics.
This will take time to implement but could mean a return to form for the apparel retailer.

Miniso: Undeterred by Tariffs. IP-Strategy, Global Expansion on Track. Value Buy

By Devi Subhakesan

MINISO Group Holding (9896 HK) committed to expanding in the U.S. with plans in place to mitigate the impact of U.S. tariffs on Chinese goods via its diversified supply chain strategy.
Key investor concern: Slower store expansion in Mainland China in 2025 may temper near-term sales and profit growth. Capital intensive overseas expansion could dilute potential returns.
Miniso (MNSO US)’s accelerating shift toward higher-margin IP co-branded lifestyle products—a strategy poised to sustain double-digit revenue growth, makes it an attractive investment play in the lifestyle retail space.

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Mar 24

Daily Brief Macro: How to Trade the Momentum Reversal and more

By Smartkarma Daily Briefs | Daily Briefs, Macro

In today’s briefing:

How to Trade the Momentum Reversal
The U.S. Bear Market: SELL THE RALLY!
Japan Morning Connection: Micon After Market Gains Fail to Follow-Through
Fed Tapers QT to Pre-Empt Debt Ceiling Increase as Forward Interest Rate Guidance Remains Unchanged
Iron Ore Tracker (24-Mar-2025): Iron Ore At Support Levels of 100 USD/Ton
Copper Tracker 24th March 2025: China “Special Action Consumption Plan”/Comex Spreads Stratospheric
The Fed’s Next Move: How Interest Rates Will Make or Break Your Portfolio

How to Trade the Momentum Reversal

By Cam Hui

Global equity markets saw a sudden reversal in risk appetite out of the Magnificent Seven.
While risk appetite has recovered in the U.S. equity market and a relief rally will likely continue, the jury is still out on whether the stampede into non-U.S. will continue.
Reiterate our view that any relief rally is unlikely to be sustainable. Investors may be better served by diversifying their U.S. exposure into non-U.S. equities for the coming market cycle.

The U.S. Bear Market: SELL THE RALLY!

By David Mudd

The initial target range for the S&P in the US bear market is 4800 to 5000. This level also coincides with the technical level of -20% from the top.
The stock market and economy in the US are highly co-dependent, and the bear market will cause consumption to fall more than in previous market downturns.
Foreign investors have started to reduce their overweight US allocations quickly. Retiree “Sequence of Returns Risk” will add to selling pressure in the US market.

Japan Morning Connection: Micon After Market Gains Fail to Follow-Through

By Andrew Jackson

Micon management blaming soft NAND pricing, yet the outlook looks bright with price hikes on the horizon for April.
Trump announcing the F-47 fighter jet after his status as 47th president sending Boeing up and Lockheed down
Mega banks and Reginal banks posted sizable gains in Japan last week on expectations for higher yields. Looks priced in, but markets need something to chase with AI fever waning.

Fed Tapers QT to Pre-Empt Debt Ceiling Increase as Forward Interest Rate Guidance Remains Unchanged

By Said Desaque

The Fed modestly revised economic growth expectations downwards for 2025 and next year and chose not to alter forward guidance. Two anticipated policy rate reductions in 2025 remain intact.
Significant tapering of quantitative tightening was announced in anticipation of a debt ceiling agreement being reached. Higher Treasury borrowing could reduce reserves in the banking system, potentially creating financial instability.
Short-Term survey-based measures of consumers’ inflationary expectations have seemingly become more unhinged in 2025, but this should not prevent the Fed from switching to easier policy settings if required.

Iron Ore Tracker (24-Mar-2025): Iron Ore At Support Levels of 100 USD/Ton

Mixed data from China shows property prices down 5-7% YoY and lower land sales YTD, while weaker U.S. consumer sentiment has also negatively impacted overall commodity prices.
China’s total social financing (TSF) for Jan-Feb reached 9.29 trillion RMB (Vs. consensus 9.75 trillion RMB). However, this figure is +16.6% YoY, signaling that substantial stimulus measures are in effect.
We expect iron ore prices to remain rangebound between 95-120 USD/ton over the next few months as cost support is strong at the 100 USD/ton level.

Copper Tracker 24th March 2025: China “Special Action Consumption Plan”/Comex Spreads Stratospheric

Copper prices are receiving a favorable lift following the announcement of China’s “Special Action Plan to Boost Consumption” made early last week.
Total Social Financing (TSF) increased by 16% YoY for Jan-Feb to 9.29 trillion RMB. Despite being below the analyst forecasts (which were revised upwards), this is a strong number.
Coupled with weaker supply (Post Results FY24: Mine-By-Mine Plan Production + Commentary on Copper From Global Listed Companies ), copper prices can surpass 10k USD/ton in the medium-term.

The Fed’s Next Move: How Interest Rates Will Make or Break Your Portfolio

By Albert Maass

Fed policy choices could create two distinct market paths: a growth-driven rally if rates fall to 2-2.5% or a defensive rotation if rates stay near 5%.
Understanding equity as a call option explains why changing interest rates dramatically impacts sector performance and overall market returns.
Practical strategies exist for navigating both scenarios, focusing on portfolio positioning that can adapt to either Fed outcome.

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Mar 24

Most Read: NetEase , Sun Corp, Binex Co Ltd, Korea Stock Exchange Kospi Index, Meituan, Shinko Electric Industries, VIOL , Kum Yang , Guangzhou Automobile Group and more

By Smartkarma Daily Briefs | Daily Briefs, Most Read

In today’s briefing:

Hang Seng Indexes: FAF Methodology Change for Secondary Listings; Over US$1bn to Buy in NetEase
Sun Corp (6736) – Still Cheap
KOSDAQ150 Index Adhoc Rebalance: Binex (053030 KS) To Replace HLB Life Science (067630 KS)
Korea’s FSC Just Dropped the Final Playbook on the Full Restart of Short Selling.
China & HK Strategy: Assessing Placement Risks, Who Needs Money?
Meituan (3690 HK): 4Q24, High Growth and Higher Margin, 60% Upside
(Mostly) Asia-Pac M&A: Westgold/Spartan, Dropsuite, Shandong Fengxiang, Proto Corp, Shinko Electric
Detailing KRX Market Alerts & Passive Flow Plays
Kum Yang: A Potential Delisting? [Murphy’s Law in Progress]
A/H Premium Tracker (To 21 Mar 2025): AH Premia Still Falling; Expect Curve Torsion or AH Widening

Hang Seng Indexes: FAF Methodology Change for Secondary Listings; Over US$1bn to Buy in NetEase

By Brian Freitas

Hang Seng Indexes has announced a change in the FreeFloat-Adjusted Factor (FAF) methodology for Secondary Listings that will be implemented from the next rebalance in June.
NetEase (9999 HK), Baidu (9888 HK), Trip.com (9961 HK), NIO (9866 HK), New Oriental Education & Techn (9901 HK) and Weibo (9898 HK) benefit; GDS Holdings (9698 HK) loses out.
The FAF changes along with capping changes will result in a round-trip trade of HK$34.2bn (US$4.4bn) at the June rebalance with the largest turnover for the Hang Seng TECH Index.

Sun Corp (6736) – Still Cheap

Eight months on from the Tender Offer which changed the shape of the shareholder register, Sun Corp (6736 JP) is as cheap to its main asset as it was before.
Sun Corp is cheap to its holding in Cellebrite DI (CLBT US). How cheap depends on the form and structure of its eventual exit.
Understanding what the options are (and the dynamics around hedging/exposure) is worthwhile.

KOSDAQ150 Index Adhoc Rebalance: Binex (053030 KS) To Replace HLB Life Science (067630 KS)

By Brian Freitas

HLB Life Science (067630 KS) was added to the Investment Attention Issue list on 21 March and traded limit down. Then came the announcement of the KOSDAQ 150 Index deletion.
As the highest ranked non-constituent from the Healthcare sector at the December rebalance, Binex (053030 KS) will be added to the KOSDAQ 150 Index at the close on 25 March.
Historically, intra-review inclusions have moved higher between announcement and implementation and there has been reversion post the index inclusion.

Korea’s FSC Just Dropped the Final Playbook on the Full Restart of Short Selling.

By Sanghyun Park

Today’s update clarifies which brokers are fully linked to NSDS, giving them an edge in short-selling speed and flexibility, while others face more execution constraints.
This leads to a clear execution risk gap, requiring traders to factor in trade efficiency differences based on their broker.
With lower short-selling restriction triggers, liquidity and short-covering dynamics will shift, requiring traders to reassess market impact and adjust strategies accordingly.

China & HK Strategy: Assessing Placement Risks, Who Needs Money?

The YTD rally in the Hong Kong and China markets has made it appealing for highly leveraged and outperforming stocks to make placements to raise fresh equity.
GDS Holdings (9698 HK), China Youran Dairy Group (9858 HK), Shandong Gold Mining (1787 HK), Zhaojin Mining Industry (1818 HK), and BYD Electronics (285 HK) are possible candidates.
Four of the top 30 YTD best-performing Hang Seng Composite stocks have made placements in the last three months, raising a total of HK$1.3bn with mixed performance since then.

Meituan (3690 HK): 4Q24, High Growth and Higher Margin, 60% Upside

By Ming Lu

In 4Q24, Meituan’s revenue growth rate was 20% YoY with all businesses rising.
The operating margin improved to 8.8% in 4Q24 versus about zero in 4Q23.
We set an upside of 61% and a price target of HK$270. Buy.

(Mostly) Asia-Pac M&A: Westgold/Spartan, Dropsuite, Shandong Fengxiang, Proto Corp, Shinko Electric

By David Blennerhassett

I tally 52 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma.
Three news new deals discussed this week: the Westgold Resources (WGX AU)/Spartan Resources (SPR AU) merger, and EcoNaviSta (5585 JP)‘s Tender Offer.
Key updates/news took place on: Dropsuite Ltd (DSE AU),Shandong Fengxiang (9977 HK), Proto Corp (4298 JP), and Shinko Electric Industries (6967 JP).

Detailing KRX Market Alerts & Passive Flow Plays

By Sanghyun Park

HLB Life Science faces delisting if it stays in ATTENTION for four years or gets a disclaimer in an audit—barring surprises, there’s still runway before it’s a real threat.
HLB Inc getting ATTENTION in May looks likely, as KRX factors in frequent correction disclosures—HLB’s history with Rivoceranib filings and the failed FDA bid add to the risk.
If HLB Inc. gets ATTENTION in May and drops from KOSDAQ 150, VIOL (335890 KS) steps in—worth positioning ahead of late April.

Kum Yang: A Potential Delisting? [Murphy’s Law in Progress]

By Douglas Kim

Murphy’s law is at progress for Kum Yang (001570 KS).
On 21 March, Kum Yang’s external auditor gave a disclaimer of opinion on the on its audit report.
Korea Exchange is becoming more serious about delisting shady companies, especially one that receives inappropriate audit opinions for two consecutive years.

A/H Premium Tracker (To 21 Mar 2025): AH Premia Still Falling; Expect Curve Torsion or AH Widening

AH Premia continue to fall. Spread curve torsion was a barbell this week. Narrow and wide spreads see Hs outperform. Middling spreads outperform less.
To me, warning signs are flashing on spreads. They are at their narrowest in 5yrs and they are volatile, though volatility is coming down.
Lots of spreads see the HA premium less than 15%. That is historically tight.

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Mar 24

Daily Brief Utilities: ENN Energy and more

By Smartkarma Daily Briefs | Daily Briefs, Utilities Sector

In today’s briefing:

ENN Energy (2688 HK): Privatisation or What? A Look at the Valuations

ENN Energy (2688 HK): Privatisation or What? A Look at the Valuations

ENN Energy (2688 HK) has suspended trading. The possibilities include privatisation, third-party offer, increase in stake by ENN Natural Gas (600803 CH), and a change in control.
It trades on 1.16x 12-month forward P/B, vs. 5-year average of 2.42x and 1.31x since 2024. Given the lower forward ROE, it is difficult to return to the 5-year average.
For PER, it should be higher than China Gas Holdings (384 HK) but lower than CR Gas (1193 HK). At 10.8x (average of the two), it equates to HK$74.26.

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Mar 24

Daily Brief Industrials: CK Hutchison Holdings, China Merchants Port, Jiangsu Zenergy Battery Technologies, Hesai Group and more

By Smartkarma Daily Briefs | Daily Briefs, Industrials

In today’s briefing:

Weekly Deals Digest (23 Mar) – CK Hutchison, Canvest, ENN Energy, HKBN, Fengxiang, Spartan, DN Sols
China Merchants Port (144 HK): Will It Have a Role in CKH’s Port Sale?
Jiangsu Zenergy Battery Technologies Pre- IPO – The Positives – Brisk Volume-Led Growth
Hesai Group: Growth Acceleration Has Already Priced In While Upside May Be Limited

Weekly Deals Digest (23 Mar) – CK Hutchison, Canvest, ENN Energy, HKBN, Fengxiang, Spartan, DN Sols

A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
ECM developments: DN Solutions (298440 KS) seeks to raise US$1.1 billion in a KRX IPO.
Event-Driven developments: CK Hutchison Holdings (1 HK), Canvest Environmental Protection Group (1381 HK), ENN Energy (2688 HK), HKBN Ltd (1310 HK), Shandong Fengxiang (9977 HK), Spartan Resources (SPR AU).

China Merchants Port (144 HK): Will It Have a Role in CKH’s Port Sale?

China Merchants Port (144 HK) may potentially play a role in CK Hutchison Holdings (1 HK)‘s port portfolio disposal should the mainland government want to step in.
While CMPH’s size is small relative to the port portfolio, its parent China Merchants Group and sister China Merchants Bank H (3968 HK) can easily facilitate such a transaction.
Having the portfolio in the hands of mainland company is desirable to the Chinese government. Even if CMPH has no role, its 7.6x PER and 6% yield are attractive.

Jiangsu Zenergy Battery Technologies Pre- IPO – The Positives – Brisk Volume-Led Growth

By Akshat Shah

Jiangsu Zenergy Battery Technologies (JSZENERGY CH) (Zenergy) is looking to raise up to US$300m in its upcoming HK IPO.
Zenergy is an EV and energy storage system battery manufacturer providing integrated battery solutions, encompassing battery cells, modules, packs and battery management systems dedicated to large-scale applications of electrochemical products.
In this note, we talk about the positive aspects of the deal.

Hesai Group: Growth Acceleration Has Already Priced In While Upside May Be Limited

By Andrei Zakharov

Hesai Group, a global leader in LiDAR solutions in the ADAS and robotics markets, forecasted hyper-growth and GAAP profitability for the full year of 2025.
The stock has bottomed in the low $4s (~0.3x 2025E EV/Revs) in 2024 and gained about 350%. Hesai Group currently trades at ~4x EV/2025E revenues, ~32% discount relative to RoboSense.
I believe that the market has already priced in growth acceleration (~58% y/y) scenario in 2025 along with GAAP profitability and 1M+ LiDAR shipments this year.

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Mar 24

Daily Brief Australia: Iron Ore and more

By Smartkarma Daily Briefs | Australia, Daily Briefs

In today’s briefing:

Iron Ore Tracker (24-Mar-2025): Iron Ore At Support Levels of 100 USD/Ton

Iron Ore Tracker (24-Mar-2025): Iron Ore At Support Levels of 100 USD/Ton

Mixed data from China shows property prices down 5-7% YoY and lower land sales YTD, while weaker U.S. consumer sentiment has also negatively impacted overall commodity prices.
China’s total social financing (TSF) for Jan-Feb reached 9.29 trillion RMB (Vs. consensus 9.75 trillion RMB). However, this figure is +16.6% YoY, signaling that substantial stimulus measures are in effect.
We expect iron ore prices to remain rangebound between 95-120 USD/ton over the next few months as cost support is strong at the 100 USD/ton level.

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Mar 24

Daily Brief TMT/Internet: NetEase , HKBN Ltd, Taiwan Semiconductor (TSMC) – ADR, Micron Technology, DiDi Global, PC Partner, Hon Hai Precision Industry, Kuaishou Technology, IAC , Robosense Technology and more

By Smartkarma Daily Briefs | Daily Briefs, TMT/Internet

In today’s briefing:

Hang Seng Indexes: FAF Methodology Change for Secondary Listings; Over US$1bn to Buy in NetEase
Merger Arb Mondays (24 Mar) – HKBN, ESR, Canvest, Vesync, Seven & I, Proto, Makino, Spartan
Taiwan Dual-Listings Monitor: TSMC Headroom Increases Again; ASE at Discount a Long Opportunity
Micron. HBM Gets Even Better, NAND Gets Even Worse
Didi Global Q424 Results: Another Set of Solid Numbers from China’s Ride Hailing Giant
PC Partners (1263 HK): SGX Primary Listing Justified To Maintain NVIDIA Supply
Foxconn’s Huge EV Bet Pays Off: Key Mitsubishi Win Could Spark Additional Automaker Deals to Come
Kuaishou Technology (1024 HK) Earnings Today: Anticipated Price Movements
Weekly Update (ANGI, IAC, SNRE)
RoboSense Technology: Premium Multiple Is Not Justified. Long Path To Profitability

Hang Seng Indexes: FAF Methodology Change for Secondary Listings; Over US$1bn to Buy in NetEase

By Brian Freitas

Hang Seng Indexes has announced a change in the FreeFloat-Adjusted Factor (FAF) methodology for Secondary Listings that will be implemented from the next rebalance in June.
NetEase (9999 HK), Baidu (9888 HK), Trip.com (9961 HK), NIO (9866 HK), New Oriental Education & Techn (9901 HK) and Weibo (9898 HK) benefit; GDS Holdings (9698 HK) loses out.
The FAF changes along with capping changes will result in a round-trip trade of HK$34.2bn (US$4.4bn) at the June rebalance with the largest turnover for the Hang Seng TECH Index.

Merger Arb Mondays (24 Mar) – HKBN, ESR, Canvest, Vesync, Seven & I, Proto, Makino, Spartan

We summarise the latest spreads and newsflow of merger arb situations we cover across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Philippines, Thailand and Chinese ADRs.
Highest spreads: Seven & I Holdings (3382 JP), OneConnect Financial Technology (OCFT US), Insignia Financial (IFL AU), Smart Share Global (EM US), Soundwill Holdings (878 HK).
Lowest spreads: Makino Milling Machine Co (6135 JP), Shibaura Electronics (6957 JP), Domain Holdings Australia (DHG AU), Tonami Holdings (9070 JP), PointsBet Holdings (PBH AU).

Taiwan Dual-Listings Monitor: TSMC Headroom Increases Again; ASE at Discount a Long Opportunity

TSMC: +20% Premium; Wait for Higher Premium Before Shorting, ADR Headroom Has Increased Further
UMC: -1.6% Discount; Wait for Lower Discount Before Going Long
ASE: -0.1% Discount; Discounts Are Good Level to Long the Spread Given Maxed Headroom

Micron. HBM Gets Even Better, NAND Gets Even Worse

By William Keating

Micron this week reported revenues of $8.1 billion, down 8% QoQ but up 38% YoY, and at the top end of the guided range
Micron is expecting to reach an annual run rate of $7.8 billion by Q425. Wow!
NAND is headed for yet another downturn after six quarters of sequential growth.

Didi Global Q424 Results: Another Set of Solid Numbers from China’s Ride Hailing Giant

By Daniel Hellberg

Most key P&L items and revenue drivers improved Y/Y and sequentially vs Q324
Although GTV per transaction dipped slightly, estimated “take rate” improved in Q424
Strong OpCF obviates need for quick FY25 IPO — but it could still happen this year

PC Partners (1263 HK): SGX Primary Listing Justified To Maintain NVIDIA Supply

By David Blennerhassett

On the 18th June 2024, PC Partner (1263 HK)‘s board said it was considering an SGX listing, by way of introduction, and applying for the withdrawal of the HKEx listing.
A 30th August 2024 announcement provided clarity on a step-by-step approach for the HKEx withdrawal. A secondary listing on the SGX was established on the 15th November.
The next step is to establish a dual-primary listing in Singapore. Then withdraw the HKEx listing. The key driver behind this exercise is ensure the uninterrupted supply of NVIDIAs GPUs.

Foxconn’s Huge EV Bet Pays Off: Key Mitsubishi Win Could Spark Additional Automaker Deals to Come

Mitsubishi Motors plans to outsource EV production to Foxconn, signaling the most significant commercial validation of Foxconn’s MIH EV platform to date.
While Foxconn’s AI server manufacturing is currently the company’s strongest growth driver, its EV strategy is increasingly gaining credibility as a second long-term pillar.
Foxconn — Structural Long. We see depressed share price as buying opportunity. Mitsubishi contract win increases the probability for additional major OEM production partnership wins this year for Foxconn.

Kuaishou Technology (1024 HK) Earnings Today: Anticipated Price Movements

By Gaudenz Schneider

Kuaishou Technology (1024 HK) is set to report its latest financial results today, on March 24, 2025, after market close.
Expected Price Movement: Historical median price movement post-earnings is 5.6%, with option implied movement at 5.9%, indicating consistent expectations.
Options Strategies: Discussion of option strategies and trading opportunities, or the lack thereof, based on the narrow margin of the March 28 straddle pricing.

Weekly Update (ANGI, IAC, SNRE)

By Richard Howe

On March 31, 2025, IAC Inc (IAC) will spin off Angi Inc (ANGI). The first day of trading will be April 1st.
Transaction Structure: The spin-off is designed to be tax-free, providing IAC shareholders with direct ownership of Angi. This move will eliminate Angi’s dual-class share structure, transitioning to a one share/one vote system.
Distribution Ratio: IAC shareholders will receive approximately 0.5178 shares of Angi Class A common stock for each IAC share they hold. This ratio accounts for a planned 1-for-10 reverse stock split of Angi’s shares, effective March 24, 2025.

RoboSense Technology: Premium Multiple Is Not Justified. Long Path To Profitability

By Andrei Zakharov

RoboSense Technology shares significantly outperformed in 2025 with shares up ~43% over the year versus a ~18% gain on the HSI.
Chinese mass producer of LiDAR products and sensor systems has successfully completed a placing of new shares and raised ~$HK1B or ~US$131M in March.
I think the stock is overvalued vs. peers given long path to profitability, lower relative gross margin profile and intense competition in Mainland China.

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Mar 24

Daily Brief Energy/Materials: Nanshan Aluminium International Holdings, Copper, Iron Ore, JX Advanced Metals and more

By Smartkarma Daily Briefs | Daily Briefs, Energy & Materials Sector

In today’s briefing:

Nanshan Aluminium (2610 HK): Low IPO Free Float Prevents Global Index Inclusion Despite $2.4B Mcap
Copper Tracker 24th March 2025: China “Special Action Consumption Plan”/Comex Spreads Stratospheric
Iron Ore Tracker (24-Mar-2025): Iron Ore At Support Levels of 100 USD/Ton
ECM Weekly (24th Mar 2025) -JX Advance, DN Solutions, Nanshan Aluminimum, Anthem, EAAA, Judo Capital

Nanshan Aluminium (2610 HK): Low IPO Free Float Prevents Global Index Inclusion Despite $2.4B Mcap

By Dimitris Ioannidis

Nanshan Aluminium (2610 HK) is forecasted to fail the fcap thresholds of both Global indices in 2025 due to low IPO free float.
The free float is not expected to increase upon lock-up expiry because of strategic Cornerstone and substantial shareholdings.
Probability of addition to Global indices increases for the first time in March and May 2026 following the expected omission of strategic Cornerstone holdings from filings thus free float.

Copper Tracker 24th March 2025: China “Special Action Consumption Plan”/Comex Spreads Stratospheric

Copper prices are receiving a favorable lift following the announcement of China’s “Special Action Plan to Boost Consumption” made early last week.
Total Social Financing (TSF) increased by 16% YoY for Jan-Feb to 9.29 trillion RMB. Despite being below the analyst forecasts (which were revised upwards), this is a strong number.
Coupled with weaker supply (Post Results FY24: Mine-By-Mine Plan Production + Commentary on Copper From Global Listed Companies ), copper prices can surpass 10k USD/ton in the medium-term.

Iron Ore Tracker (24-Mar-2025): Iron Ore At Support Levels of 100 USD/Ton