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Smartkarma Daily Briefs

Mar 10
0

Daily Brief Indonesia: Multi Bintang Indonesia and more

By | Daily Briefs, Indonesia

In today’s briefing:

  • Multi Bintang Indonesia (MLBI IJ): Steady FY24, 9% Yield and >80% ROCE

Multi Bintang Indonesia (MLBI IJ): Steady FY24, 9% Yield and >80% ROCE

By Sameer Taneja

  • Multi Bintang Indonesia (MLBI IJ)  delivered steady FY24 growth, with revenue and profits up 1.9% and 7.1% YoY, respectively. Q4 FY24, however, underperformed expectations with revenue/profits up 0.6%/1.7% YoY.
  • Although Q4 typically represents >30% of overall annual revenue/profits, being the strongest season, its performance was disappointing compared to the strong 21%/35% YoY revenue/profit growth seen in Q3 2024.
  • Multi Bintang Indonesia (MLBI IJ) represents tremendous value with a dividend yield of 9% (100% payout), ROEs exceeding 80%, and a cheap multiple of 11x FY24 PE. 

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Mar 10
0

Daily Brief United States: DoorDash , Middleby Corp and more

By | Daily Briefs, United States

In today’s briefing:

  • S&P500/400/600 Index Rebalance: DASH In as Stability Trumps Volatility
  • Weekly Update (IDT, RHLD, SNRE, SNDK)

S&P500/400/600 Index Rebalance: DASH In as Stability Trumps Volatility

By Brian Freitas

Weekly Update (IDT, RHLD, SNRE, SNDK)

By Richard Howe

  • There were no new spin-off announcements this week.

  • The Middleby Corporation (MIDD) announced its plan to spin off its food processing business on February 25, 2025.

  • This strategic move aims to allow Middleby to concentrate on its core commercial foodservice and residential kitchen equipment sectors, while enabling the new entity to focus exclusively on food processing operations.

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Mar 10
0

Daily Brief China: China Vanke (H), Tencent, ESR Group , JD.com , Mixue Group, Hang Seng Index, Chifeng Jilong Gold Mining, Soundwill Holdings, J&T Global Express , AviChina Industry & Technology H and more

By | China, Daily Briefs

In today’s briefing:

  • A/H Premium Tracker (To 7 Mar 2025):  AH Premia Still Falling; Expect Curve Torsion or AH Widening
  • HK Connect SOUTHBOUND Flows (To 7 Mar 2025); Big Volumes, Big Net; Tech, Banks, and Telecoms
  • Merger Arb Mondays (10 Mar) – Seven & I, Naigai, ESR, Soundwill, OneConnect, Goldlion, PointsBet
  • JD.com (9618 HK) FY Earnings Recap: Intra-Day Swing of 7.3%.
  • MIXUE Group (2097.HK) – Updates on Performance Forecast and Valuation Outlook
  • Hong Kong Single Stock Options Weekly (March 03 – 07): From Caution to Euphoria as Sentiment Flips
  • Chifeng Jilong A/H Trading – Weak Institutional Demand and Probably Close to Fair Value
  • Soundwill Holdings (878 HK): Founder’s Scheme At $8.50/Share
  • J&T Global Express H224 Results: Levers That Drove Earlier Improvement Are Losing Power
  • AviChina Industry (2357 HK): The Discount to Narrow

A/H Premium Tracker (To 7 Mar 2025):  AH Premia Still Falling; Expect Curve Torsion or AH Widening

By Travis Lundy

  • AH Premia continue to fall. Spread curve torsion reverses again with wide premia trades seeing Hs perform the best vs their As.
  • To me, warning signs are flashing on spreads. They are at their narrowest in 5yrs and they are volatile. Last week I recommended a HUGE trimming (30%) of the book.
  • Hindsight is 20:20. I should have kept them, but the book still produced 51bp of alpha for the week on top of the 35bp of H/A beta. 

HK Connect SOUTHBOUND Flows (To 7 Mar 2025); Big Volumes, Big Net; Tech, Banks, and Telecoms

By Travis Lundy

  • Gross SOUTHBOUND volumes dropped somewhat but still high. NET buying by SOUTHBOUND was HK$35bn which is still quite strong. Round-tripping volume down 20% week-on-week.
  • The flows here are still striking. >20% of the top 100 most liquid Southbound eligible stocks saw SOUTHBOUND buy more than 10% of weekly volume. 
  • It feels like there is some common understanding among SOUTHBOUND investors which I do not understand. The numbers are big/growing.

Merger Arb Mondays (10 Mar) – Seven & I, Naigai, ESR, Soundwill, OneConnect, Goldlion, PointsBet

By Arun George

JD.com (9618 HK) FY Earnings Recap: Intra-Day Swing of 7.3%.

By Gaudenz Schneider

  • JD.com (9618 HK) Q4 2024 earnings significantly exceeded analyst expectations with revenue reaching RMB 347 billion (13.4% YoY increase).
  • The stock experienced a volatile two-day reaction, rising 8.4% on March 6 followed by a 5.0% decline on March 7, resulting in a net gain of 3.03%.
  • Options strategies including straddles, strangles, and call calendar spreads were actively traded ahead of earnings with potential intraday profitability. Longer dated implied volatility decreased following the announcement.

MIXUE Group (2097.HK) – Updates on Performance Forecast and Valuation Outlook

By Xinyao (Criss) Wang

  • MIXUE’s IPO debut was stellar. the IPO pricing of HK$202.5/share was indeed conservative. MIXUE is able to obtain more valuation premium space after IPO from a relatively low IPO pricing.
  • However, concerns on future performance growth remains. Investors need to pay attention to the performance verification. Market sentiment is becoming “overheated”, and the pressure for short-term stock price corrections increases.
  • We updated our forecast for 2025-2027. If based on P/E of 20-25x, market value is HK$109.4-136.8 billion, HK$122.5-153.2 billion, HK$134.8-168.5 billion based on 2025, 2026 and 2027 net profit, respectively.  

Hong Kong Single Stock Options Weekly (March 03 – 07): From Caution to Euphoria as Sentiment Flips

By John Ley

  • A dramatic shift saw stocks surge as market sentiment reversed week over week.
  • Single stock option volumes were significantly lower vs prior two weeks.
  • We highlight stocks that have had unusual moves in price, volume and implied volatility.

Chifeng Jilong A/H Trading – Weak Institutional Demand and Probably Close to Fair Value

By Nicholas Tan

  • Chifeng Jilong Gold Mining (600988 CH) , a gold mining company in China, raised around US$363m in its H-share listing in Hong Kong.
  • It operates six gold mines in Asia and Africa and has been listed on the Shenzhen Stock Exchange since 2004.
  • We have covered the company and deal background in our previous notes. In this note, we talk about the trading dynamics.

Soundwill Holdings (878 HK): Founder’s Scheme At $8.50/Share

By David Blennerhassett

  • After small-cap property developer Soundwill Holdings (878 HK) was suspended pursuant to the Takeovers Code, I expected an Offer by way of Scheme. 
  • And that is what unfolded. Grace Foo (ED) and her family, controlling 74.97% of shares out, are Offering $8.50/share, including a $1.00/share dividend, a 62.84% premium to undisturbed.  
  • That’s still a whopping 87.66% discount to the most recent NAV (30th June 2024). But what are the options for minorities (apart from the headcount test)? And terms are final. 

J&T Global Express H224 Results: Levers That Drove Earlier Improvement Are Losing Power

By Daniel Hellberg

  • H224 showed moderating top-line growth, but solid Y/Y improvement in EBITDA margin
  • However, the levers that drove margin improvement in 2024 appear to be losing power
  • Within China’s express and logistics segment, we find SF Holding to be far more attractive

AviChina Industry (2357 HK): The Discount to Narrow

By Osbert Tang, CFA

  • The share price of AviChina Industry & Technology H (2357 HK) has picked up in Mar, and it will continue to chase the HSI and HSCEI, in our view.
  • At 54.1%, AviChina’s discount to its A-share holdings has narrowed 4.2pp YTD, but is still behind the 6.2pp contraction for overall H-A shares. There is more room to catch up.
  • The increase in defense spending, advancement in domestic commercial aviation and development of the low-altitude economy are major potential drivers.

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Mar 10
0

Daily Brief India: Jindal Steel & Power, NIFTY Index and more

By | Daily Briefs, India

In today’s briefing:

  • Jindal Steel & Power (JSP IN) – Cyclical Downturn Provides Attractive Entry Point
  • Nifty Index Options Weekly (Mar 03 – 07): Rebound Ends Extended Losing Streak

Jindal Steel & Power (JSP IN) – Cyclical Downturn Provides Attractive Entry Point

By Rahul Jain

  • Strong focus on capacity enhancement. Increasing steelmaking capacity by 65% over the next 3 years to 15.9mt.
  • Recent margin dip provides attractive entry point. Promoters/insiders have bought into recent decline in stock price
  • Attractive long-term play on rising domestic steel demand. Low debt levels at <1.4x EBITDA allows for steady capacity addition. 

Nifty Index Options Weekly (Mar 03 – 07): Rebound Ends Extended Losing Streak

By John Ley

  • The Nifty snapped its losing streak with a sharp rebound, rising 1.92% for the week.
  • Implied volatility struggled to hold up, trading lower through most of the week.
  • We break down the implied vs. historic vol relationship and what it signals for traders.

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Mar 10
0

Daily Brief Japan: Nikkei 225, Mitsui O.S.K. Lines, Daihatsu Diesel Mfg, TSE Tokyo Price Index TOPIX and more

By | Daily Briefs, Japan

In today’s briefing:

  • Index Rebalance Strategy YTD Performance: Not Many Places to Hide in Asia
  • The USTR’s New “Proposed Actions” For Section 301 Investigation on China’s Maritime/Shipping Sectors
  • Daihatsu Diesel (6023) Buyback Tender Results Signal Overhang and Opportunity
  • Significant Share Buybacks Are Key to Improving Profitability of Capital
  • Nikkei Index Options Weekly (Mar 03–07): Implied Volatility Climbs as Market Extends Decline

Index Rebalance Strategy YTD Performance: Not Many Places to Hide in Asia

By Brian Freitas

  • We look at the performance of the index rebalance strategy over the year using weekly forecasts. In short, it has been a mixed bag for Asia.
  • India and China have been among the worst performing markets in the region while Australia and Korea have been among the better performers.
  • A lot of the outperformance appears to be front loaded, so getting the forecasts right early in the review period is of paramount importance.

The USTR’s New “Proposed Actions” For Section 301 Investigation on China’s Maritime/Shipping Sectors

By Travis Lundy

  • The USTR issued a Section 301 report in January 2025. The report suggests China has tried to achieve dominance in global shipping, to the detriment of US commerce.
  • The report is flawed, in data (it somehow manages to make up data which is otherwise available from MARAD), analytics, and conclusions, but the Trump administration has run with it.
  • In February, the USTR announced “Proposed Actions” – fees for Chinese liners and international liners with Chinese ships, and restrictions on future exports. US users lose. And there are loopholes.

Daihatsu Diesel (6023) Buyback Tender Results Signal Overhang and Opportunity

By Travis Lundy

  • In late January, Daihatsu Diesel Mfg (6023 JP) announced its once/former parent would sell all its shares; in part to a private company in the industry and a 20% buyback.
  • The buyback – a below-market own-share tender offer – was priced low enough to be a big win. Accretion added to that. 
  • Buyback Tender Results and External Changes signal overhang and opportunity. Either way, it’s cheap, but good governance could make it even cheaper.

Significant Share Buybacks Are Key to Improving Profitability of Capital

By Aki Matsumoto

  • While the company’s attitude toward shareholder returns has been positive, the 11% dividend increase is not expected to reduce cash on hand by much.
  • In a condition where so much cash has accumulated, it’s not a bad idea to use DOE as a guide to avoid accumulating cash on hand above a certain level.
  • Since FY3/2025 profits will grow in non-manufacturers, which has relatively low profit margin, the overall profit margin of companies won’t increase. Therefore, unless assets are reduced significantly, ROE will soft.

Nikkei Index Options Weekly (Mar 03–07): Implied Volatility Climbs as Market Extends Decline

By John Ley

  • Nikkei breaks lower, USD/JPY and trade tensions weighing on the market.
  • Implied volatility rose as the market declined. We discuss implications of current spot levels that is dominated by Put open interest.
  • Historic volatility continues to lag implied vol, we provide visuals on the extent of the lag.

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Mar 10
0

Daily Brief Energy/Materials: SK Innovation, Jindal Steel & Power, Chifeng Jilong Gold Mining, NIFTY Index and more

By | Daily Briefs, Energy & Materials Sector

In today’s briefing:

  • Got the BBIG Rebalancing Results: SK Innovation Is the Trade This Week
  • Jindal Steel & Power (JSP IN) – Cyclical Downturn Provides Attractive Entry Point
  • Chifeng Jilong A/H Trading – Weak Institutional Demand and Probably Close to Fair Value
  • Nifty Index Options Weekly (Mar 03 – 07): Rebound Ends Extended Losing Streak

Got the BBIG Rebalancing Results: SK Innovation Is the Trade This Week

By Sanghyun Park

  • Real alpha? Tight basket means outsized passive flows. The play? SK Innovation, no contest.
  • Samsung SDI faces -0.54x ADTV outflows. Other movers: Netmarble 0.68x, Wemade Max 0.54x, NHN -0.46x ADTV.
  • Net-Net? SK Innovation is the trade. Long here, hedge short on Samsung SDI or the broader Battery space.

Jindal Steel & Power (JSP IN) – Cyclical Downturn Provides Attractive Entry Point

By Rahul Jain

  • Strong focus on capacity enhancement. Increasing steelmaking capacity by 65% over the next 3 years to 15.9mt.
  • Recent margin dip provides attractive entry point. Promoters/insiders have bought into recent decline in stock price
  • Attractive long-term play on rising domestic steel demand. Low debt levels at <1.4x EBITDA allows for steady capacity addition. 

Chifeng Jilong A/H Trading – Weak Institutional Demand and Probably Close to Fair Value

By Nicholas Tan

  • Chifeng Jilong Gold Mining (600988 CH) , a gold mining company in China, raised around US$363m in its H-share listing in Hong Kong.
  • It operates six gold mines in Asia and Africa and has been listed on the Shenzhen Stock Exchange since 2004.
  • We have covered the company and deal background in our previous notes. In this note, we talk about the trading dynamics.

Nifty Index Options Weekly (Mar 03 – 07): Rebound Ends Extended Losing Streak

By John Ley

  • The Nifty snapped its losing streak with a sharp rebound, rising 1.92% for the week.
  • Implied volatility struggled to hold up, trading lower through most of the week.
  • We break down the implied vs. historic vol relationship and what it signals for traders.

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Mar 10
0

Daily Brief TMT/Internet: Tencent, Taiwan Semiconductor (TSMC), Hang Seng Index and more

By | Daily Briefs, TMT/Internet

In today’s briefing:

  • HK Connect SOUTHBOUND Flows (To 7 Mar 2025); Big Volumes, Big Net; Tech, Banks, and Telecoms
  • Tech News This Week. Apple AI, TSMC, Korea’s Giga-Fund, Stargate
  • Hong Kong Single Stock Options Weekly (March 03 – 07): From Caution to Euphoria as Sentiment Flips

HK Connect SOUTHBOUND Flows (To 7 Mar 2025); Big Volumes, Big Net; Tech, Banks, and Telecoms

By Travis Lundy

  • Gross SOUTHBOUND volumes dropped somewhat but still high. NET buying by SOUTHBOUND was HK$35bn which is still quite strong. Round-tripping volume down 20% week-on-week.
  • The flows here are still striking. >20% of the top 100 most liquid Southbound eligible stocks saw SOUTHBOUND buy more than 10% of weekly volume. 
  • It feels like there is some common understanding among SOUTHBOUND investors which I do not understand. The numbers are big/growing.

Tech News This Week. Apple AI, TSMC, Korea’s Giga-Fund, Stargate

By Nicolas Baratte

  • Apple’s AI struggle. Google’s Gemini has won? TSMC ex-Chairman is joining Micron’s board
  • SK Hynix out of image sensors. Korean Gvt launch US$100bn fund for strategic industries
  • Stargate first data center is under way. Close to 100k Nvidia GPU in 2026. Hon Hai makes the servers.

Hong Kong Single Stock Options Weekly (March 03 – 07): From Caution to Euphoria as Sentiment Flips

By John Ley

  • A dramatic shift saw stocks surge as market sentiment reversed week over week.
  • Single stock option volumes were significantly lower vs prior two weeks.
  • We highlight stocks that have had unusual moves in price, volume and implied volatility.

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Mar 10
0

Daily Brief Industrials: Daihatsu Diesel Mfg, Mitsui O.S.K. Lines, J&T Global Express , AviChina Industry & Technology H, Middleby Corp and more

By | Daily Briefs, Industrials

In today’s briefing:

  • Daihatsu Diesel (6023) Buyback Tender Results Signal Overhang and Opportunity
  • The USTR’s New “Proposed Actions” For Section 301 Investigation on China’s Maritime/Shipping Sectors
  • J&T Global Express H224 Results: Levers That Drove Earlier Improvement Are Losing Power
  • AviChina Industry (2357 HK): The Discount to Narrow
  • Weekly Update (IDT, RHLD, SNRE, SNDK)

Daihatsu Diesel (6023) Buyback Tender Results Signal Overhang and Opportunity

By Travis Lundy

  • In late January, Daihatsu Diesel Mfg (6023 JP) announced its once/former parent would sell all its shares; in part to a private company in the industry and a 20% buyback.
  • The buyback – a below-market own-share tender offer – was priced low enough to be a big win. Accretion added to that. 
  • Buyback Tender Results and External Changes signal overhang and opportunity. Either way, it’s cheap, but good governance could make it even cheaper.

The USTR’s New “Proposed Actions” For Section 301 Investigation on China’s Maritime/Shipping Sectors

By Travis Lundy

  • The USTR issued a Section 301 report in January 2025. The report suggests China has tried to achieve dominance in global shipping, to the detriment of US commerce.
  • The report is flawed, in data (it somehow manages to make up data which is otherwise available from MARAD), analytics, and conclusions, but the Trump administration has run with it.
  • In February, the USTR announced “Proposed Actions” – fees for Chinese liners and international liners with Chinese ships, and restrictions on future exports. US users lose. And there are loopholes.

J&T Global Express H224 Results: Levers That Drove Earlier Improvement Are Losing Power

By Daniel Hellberg

  • H224 showed moderating top-line growth, but solid Y/Y improvement in EBITDA margin
  • However, the levers that drove margin improvement in 2024 appear to be losing power
  • Within China’s express and logistics segment, we find SF Holding to be far more attractive

AviChina Industry (2357 HK): The Discount to Narrow

By Osbert Tang, CFA

  • The share price of AviChina Industry & Technology H (2357 HK) has picked up in Mar, and it will continue to chase the HSI and HSCEI, in our view.
  • At 54.1%, AviChina’s discount to its A-share holdings has narrowed 4.2pp YTD, but is still behind the 6.2pp contraction for overall H-A shares. There is more room to catch up.
  • The increase in defense spending, advancement in domestic commercial aviation and development of the low-altitude economy are major potential drivers.

Weekly Update (IDT, RHLD, SNRE, SNDK)

By Richard Howe

  • There were no new spin-off announcements this week.

  • The Middleby Corporation (MIDD) announced its plan to spin off its food processing business on February 25, 2025.

  • This strategic move aims to allow Middleby to concentrate on its core commercial foodservice and residential kitchen equipment sectors, while enabling the new entity to focus exclusively on food processing operations.

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  • ✓ Custom Watchlists
  • ✓ Company Data and News
  • ✓ Events & Webinars
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Mar 10
0

Daily Brief Consumer: DoorDash , Cheng Shin Rubber Ind Co., Ltd., JD.com , Mixue Group, TSE Tokyo Price Index TOPIX, BYD, Multi Bintang Indonesia and more

By | Consumer, Daily Briefs

In today’s briefing:

  • S&P500/400/600 Index Rebalance: DASH In as Stability Trumps Volatility
  • Quiddity TDIV/50/100 Mar25 Results: US$500Mn+ One-Way Flows Collectively; Only One Surprise
  • JD.com (9618 HK) FY Earnings Recap: Intra-Day Swing of 7.3%.
  • MIXUE Group (2097.HK) – Updates on Performance Forecast and Valuation Outlook
  • Significant Share Buybacks Are Key to Improving Profitability of Capital
  • ECM Weekly (10th Mar 2025) – BYD, Japan Post, Mixue, Sanhua, Chifeng, Nanshan, Goertek, Travel Food
  • Multi Bintang Indonesia (MLBI IJ): Steady FY24, 9% Yield and >80% ROCE

S&P500/400/600 Index Rebalance: DASH In as Stability Trumps Volatility

By Brian Freitas

Quiddity TDIV/50/100 Mar25 Results: US$500Mn+ One-Way Flows Collectively; Only One Surprise

By Janaghan Jeyakumar, CFA

  • The index changes for the T50/100 index family and the TDIV index were confirmed after market close on Friday 7th March 2025.
  • There will be one change for T50 and two other changes for T100. There will be no changes for the TDIV index but there will be capping flows.
  • In this insight, we will take a look at our final flow expectations for the March 2025 index rebal event.

JD.com (9618 HK) FY Earnings Recap: Intra-Day Swing of 7.3%.

By Gaudenz Schneider

  • JD.com (9618 HK) Q4 2024 earnings significantly exceeded analyst expectations with revenue reaching RMB 347 billion (13.4% YoY increase).
  • The stock experienced a volatile two-day reaction, rising 8.4% on March 6 followed by a 5.0% decline on March 7, resulting in a net gain of 3.03%.
  • Options strategies including straddles, strangles, and call calendar spreads were actively traded ahead of earnings with potential intraday profitability. Longer dated implied volatility decreased following the announcement.

MIXUE Group (2097.HK) – Updates on Performance Forecast and Valuation Outlook

By Xinyao (Criss) Wang

  • MIXUE’s IPO debut was stellar. the IPO pricing of HK$202.5/share was indeed conservative. MIXUE is able to obtain more valuation premium space after IPO from a relatively low IPO pricing.
  • However, concerns on future performance growth remains. Investors need to pay attention to the performance verification. Market sentiment is becoming “overheated”, and the pressure for short-term stock price corrections increases.
  • We updated our forecast for 2025-2027. If based on P/E of 20-25x, market value is HK$109.4-136.8 billion, HK$122.5-153.2 billion, HK$134.8-168.5 billion based on 2025, 2026 and 2027 net profit, respectively.  

Significant Share Buybacks Are Key to Improving Profitability of Capital

By Aki Matsumoto

  • While the company’s attitude toward shareholder returns has been positive, the 11% dividend increase is not expected to reduce cash on hand by much.
  • In a condition where so much cash has accumulated, it’s not a bad idea to use DOE as a guide to avoid accumulating cash on hand above a certain level.
  • Since FY3/2025 profits will grow in non-manufacturers, which has relatively low profit margin, the overall profit margin of companies won’t increase. Therefore, unless assets are reduced significantly, ROE will soft.

ECM Weekly (10th Mar 2025) – BYD, Japan Post, Mixue, Sanhua, Chifeng, Nanshan, Goertek, Travel Food

By Sumeet Singh

Multi Bintang Indonesia (MLBI IJ): Steady FY24, 9% Yield and >80% ROCE

By Sameer Taneja

  • Multi Bintang Indonesia (MLBI IJ)  delivered steady FY24 growth, with revenue and profits up 1.9% and 7.1% YoY, respectively. Q4 FY24, however, underperformed expectations with revenue/profits up 0.6%/1.7% YoY.
  • Although Q4 typically represents >30% of overall annual revenue/profits, being the strongest season, its performance was disappointing compared to the strong 21%/35% YoY revenue/profit growth seen in Q3 2024.
  • Multi Bintang Indonesia (MLBI IJ) represents tremendous value with a dividend yield of 9% (100% payout), ROEs exceeding 80%, and a cheap multiple of 11x FY24 PE. 

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  • ✓ Personalised Alerts
  • ✓ Custom Watchlists
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  • ✓ Events & Webinars
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Mar 10
0

Daily Brief Industrials: Daihatsu Diesel Mfg, Mitsui O.S.K. Lines, J&T Global Express , AviChina Industry & Technology H, Middleby Corp and more

By | Daily Briefs, Industrials

In today’s briefing:

  • Daihatsu Diesel (6023) Buyback Tender Results Signal Overhang and Opportunity
  • The USTR’s New “Proposed Actions” For Section 301 Investigation on China’s Maritime/Shipping Sectors
  • J&T Global Express H224 Results: Levers That Drove Earlier Improvement Are Losing Power
  • AviChina Industry (2357 HK): The Discount to Narrow
  • Weekly Update (IDT, RHLD, SNRE, SNDK)

Daihatsu Diesel (6023) Buyback Tender Results Signal Overhang and Opportunity

By Travis Lundy

  • In late January, Daihatsu Diesel Mfg (6023 JP) announced its once/former parent would sell all its shares; in part to a private company in the industry and a 20% buyback.
  • The buyback – a below-market own-share tender offer – was priced low enough to be a big win. Accretion added to that. 
  • Buyback Tender Results and External Changes signal overhang and opportunity. Either way, it’s cheap, but good governance could make it even cheaper.

The USTR’s New “Proposed Actions” For Section 301 Investigation on China’s Maritime/Shipping Sectors

By Travis Lundy

  • The USTR issued a Section 301 report in January 2025. The report suggests China has tried to achieve dominance in global shipping, to the detriment of US commerce.
  • The report is flawed, in data (it somehow manages to make up data which is otherwise available from MARAD), analytics, and conclusions, but the Trump administration has run with it.
  • In February, the USTR announced “Proposed Actions” – fees for Chinese liners and international liners with Chinese ships, and restrictions on future exports. US users lose. And there are loopholes.

J&T Global Express H224 Results: Levers That Drove Earlier Improvement Are Losing Power

By Daniel Hellberg

  • H224 showed moderating top-line growth, but solid Y/Y improvement in EBITDA margin
  • However, the levers that drove margin improvement in 2024 appear to be losing power
  • Within China’s express and logistics segment, we find SF Holding to be far more attractive

AviChina Industry (2357 HK): The Discount to Narrow

By Osbert Tang, CFA

  • The share price of AviChina Industry & Technology H (2357 HK) has picked up in Mar, and it will continue to chase the HSI and HSCEI, in our view.
  • At 54.1%, AviChina’s discount to its A-share holdings has narrowed 4.2pp YTD, but is still behind the 6.2pp contraction for overall H-A shares. There is more room to catch up.
  • The increase in defense spending, advancement in domestic commercial aviation and development of the low-altitude economy are major potential drivers.

Weekly Update (IDT, RHLD, SNRE, SNDK)

By Richard Howe

  • There were no new spin-off announcements this week.

  • The Middleby Corporation (MIDD) announced its plan to spin off its food processing business on February 25, 2025.

  • This strategic move aims to allow Middleby to concentrate on its core commercial foodservice and residential kitchen equipment sectors, while enabling the new entity to focus exclusively on food processing operations.

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