Smartkarma Daily Briefs

You might have to go all the back to Guoco Group Ltd (53 HK)‘s 2012/2013 unconditional cash offer, which was ostensibly blocked by First Eagle AND Elliott Advisors.
Otherwise, it’s slim pickings. Past Schemes or Tender Offers arguably failed as minorities were simply not supportive. There are exceptions, like Soho China (410 HK) and TCM (570 HK)
IF LVC wish to remain active in this space/region, they appear to be going about it in a counterproductive way. I still don’t understand why they would want to block.

Quiddity Leaderboard CSI 300/500 Jun 25: Large Flows; Some Inflow Names Could Outperform Index

CSI 300 represents the 300 largest stocks by market cap and liquidity from the Shanghai and Shenzhen Exchanges. CSI 500 is the next 500 names.
In this insight, we take a look at the potential ADDs and DELs leading the race for the semiannual index rebal event in June 2025.
Currently, we see 6 ADDs/DELs for the CSI 300 index and 50 ADDs/DELs for the CSI 500 index.

Quiddity Leaderboard ChiNext & ChiNext 50 Jun 25: Great Momentum for the Exp ADDs Vs Exp DELs Trade

The ChiNext index represents the performance of the 100 largest and most liquid A-share stocks listed on the ChiNext Market of the Shenzhen Stock Exchange.
The ChiNext 50 index is a subset of the ChiNext Index and it consists of the top 50 names in the ChiNext index with the highest daily average turnover.
We see 10 changes for the ChiNext index and 5 changes for the ChiNext 50 index in the next index rebal event. Combined it is about US$1bn to trade one-way.

Lifestyle China (2136 HK): Lau’s Scheme – The Premium Is Still Wrong. And Now Final

Back on the 6th December 2024, Lifestyle China (2136 HK), a PRC department store operator, announced a Scheme from Thomas Lau, its chairman/CEO and major shareholder (74.91%, including concert parties).
The HK$0.913 Offer price was miserly 21.7% premium to last close. But not declared final.
The Offer deserved a bump, and Lau has obliged. However, the revised HK$0.98/share bid, a 30.6% premium to undisturbed, remains underwhelming. Lau has declared terms final.

Lifestyle China (2136 HK): Thomas Lau Bumps, but the Offer Remains Light

By Arun George

Lifestyle China (2136 HK) disclosed a revised offer from Mr Thomas Lau at HK$0.98 per share, a 7.3% premium to the previous HK$0.913 offer. The offer has been declared final.
The bump was unsurprising. Crucially, the shares have traded above the revised offer on 20 of the 25 trading days since the previous offer was announced.
The revised offer remains light, and minorities remain unimpressed. The high AGM minority participation rates remain a vote risk. Head for the exit as the shares are trading at terms.

Legend Biotech Surges Amid Takeover Speculation—What’s Next for CARVYKTI?

Legend Biotech has been making headlines with its breakthrough CAR-T therapy, CARVYKTI, which has revolutionized the treatment of multiple myeloma.
This pioneering therapy, co commercialized with Johnson & Johnson, has achieved record-setting launches and boasts a significant survival benefit over standard treatments.
The company’s robust clinical pipeline, recent partnerships, and aggressive manufacturing expansions signal strong growth potential.

Chongqing Terminus Smart Technology Pre-IPO: Deteriorating Revenue and Losing Market Share

By Nicholas Tan

Chongqing Terminus (2471080D CH) is looking to raise about US$300m in its upcoming Hong Kong IPO.
It operates in China’s public realm AIoT (Artificial Intelligence of Things) industry.
In this note, we look at the firm’s past performance.

Asia Real Estate Tracker (16-Jan-2025): Scape secures $434M from Korea’s NPS.

By Asia Real Estate Tracker

Scape, a living platform, receives a significant investment of $434 million from Korea’s NPS, boosting its growth and expansion.
Ho Bee Land makes a competitive bid of $242 million for an Australian builder, directly challenging Proprium Capital in the real estate market.
Korea’s NPS joins forces with Almanac Realty in a $800 million real estate joint venture, solidifying their presence in the industry.

Fu Shou Yuan (1448 HK): Another Special Dividend Proposal

By Osbert Tang, CFA

Fu Shou Yuan (1448 HK)‘s share price rebound over the last two days may have well-reflected the special dividend proposal. It has, however, opened up the room for disappointment.
Assuming the same special DPS as last time, it is sitting on a 9% yield. The dividend sustainability is uncertain, and without this, it will be only 4.7% for FY25.
Earnings have been cut by 32.5% over the last six months on consumption downgrade. This near-term headwind will overshadow its long-term story.

[Trip.com (TCOM US, BUY, TP US$74) Preview]: C4Q24: Thailand Kidnapping Strengthens Domestic

By Eric Wen

We expect TCOM to report C4Q24 revenue 1.8% lower than consensus, mainly due to lukewarm outbound travel. But we see domestic and inbound remained robust heading into CNY.
Given strong data flow heading into CNY, we continue to be positive on domestic travel while outbound suffering a further setback…
We keep the stock as BUY rating and keep TP at US$74/ADS.

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Jan 17

Daily Brief Japan: Toyota Motor Corp Spon Adr, TSE Tokyo Price Index TOPIX, Stella Chemifa and more

By Smartkarma Daily Briefs | Daily Briefs, Japan

In today’s briefing:

Toyota’s EV Woes: Struggling To Find The Fast Lane In Electric Mobility
Raising Requirements for Shareholder Proposals Could Hinder the Shift to Value-Creating Management
Stella Chemifa (4109 JP) – Strong Earnings, Attractive Share Price

Toyota’s EV Woes: Struggling To Find The Fast Lane In Electric Mobility

Toyota Motor Corporation, the world’s largest automaker by production volume, finds itself at a critical juncture in the global automotive industry.
Despite a commendable first-half operating income of ¥2.464 trillion for fiscal 2025 and a full-year forecast of ¥4.3 trillion, the company’s electrification strategy—or lack thereof—remains a contentious issue.
While Toyota has mastered the art of hybrid and internal combustion engine (ICE) vehicles, it continues to lag significantly behind competitors like Tesla and BYD in the electric vehicle (EV) space.

Raising Requirements for Shareholder Proposals Could Hinder the Shift to Value-Creating Management

By Aki Matsumoto

Because the majority of companies are still unable to change themselves, both the government and the TSE have taken measures to expect engagement from institutional investors, including activist investors.
Japan has high barriers in areas that aren’t regulated by law. The existence of cross-shareholdings has allowed managers to continue to operate without respect for the interests of minority shareholders.
It is premature to raise the requirements for shareholder proposals and requests to call special meetings to the level of other countries when many companies are still protected by cross-shareholdings.

Stella Chemifa (4109 JP) – Strong Earnings, Attractive Share Price

By Sessa Investment Research

H1 FY2025/3 results review: In H1 FY2025/3, Stella Chemifa (hereafter, the Company) reported strong results, with net sales up 25.3% YoY to JPY 18,160 mn and operating profit up 94.3% YoY to JPY 2,180 mn.
The boost in sales was driven by an increase in shipments in the semiconductor category, mainly for memory devices thanks to a recovery in market conditions, and an increase in shipments of enriched boron (energy category) for new nuclear facilities overseas.
Operating profit rose substantially, as growth in shipments in the high purity chemicals business and an increase in volume in the transportation business offset the JPY 210 mn drag on profits stemming from the Company’s inability to fully reflect cost increases from higher anhydrous hydrofluoric acid prices, a key raw material, and the yen’s depreciation, onto its prices.

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Jan 17

Most Read: Tokyo Metro, Murata Manufacturing, Shanghai Henlius Biotech , Hyundai Motor India , Delta Electronics Thailand , Shanghai Electric Group Company, Lifestyle China, Taiwan Semiconductor (TSMC) and more

By Smartkarma Daily Briefs | Daily Briefs, Most Read

In today’s briefing:

Tokyo Metro (9023 JP): Index Inclusions – Light at the End of the Tunnel
Murata Manufacturing (6981 JP) – No Immediate Passive Buying Could Lead to More Weakness
Henlius (2696 HK): Musings on the Deal Break Price
Henlius (2696 HK): So, When Was The Last Time A PE/VC Outfit Blocked A Deal?
Hyundai Motor (HYUNDAI IN): Anchor Lock-Up Expiry Increases Float; Index Inclusions Near
Delta Electronics (DELTA TB / 2308 TT): Off the Peak; SET50 Deletion Risk Increases
Shanghai Henlius Biotech (2696 HK)- These Are the Reasons Why LVC May Vote Against the Privatization
Quiddity Leaderboard CSI 300/500 Jun 25: Large Flows; Some Inflow Names Could Outperform Index
Lifestyle China (2136 HK): Lau’s Scheme – The Premium Is Still Wrong. And Now Final
TSMC Results / Guidance Beat. 2025 Capex and AI Revenue up Strongly.

Tokyo Metro (9023 JP): Index Inclusions – Light at the End of the Tunnel

Tokyo Metro (9023 JP) listed on 23 October and was added to the TSE Tokyo Price Index TOPIX (TPX INDEX) at the close on 28 November.
Tokyo Metro (9023 JP) was not expected to be added to one global index (it was not added), while it was expected to be added to the other (and missed).
The stock could be added to one global index in February (its close!) and to the other in June (pretty much a sure thing).

Murata Manufacturing (6981 JP) – No Immediate Passive Buying Could Lead to More Weakness

A group of 7 shareholders are looking to sell 61.3m shares in Murata Manufacturing (6981 JP) to raise JPY 143.8bn (US$916m). That is 3.3% of shares outstanding.
The shares are being offered at a price range of JPY 2296-2345.5/share, a discount of 5-7% to the last close of the stock.
With the offering less than 5% of shares outstanding and less than US$1bn in size, there is no immediate passive buying and there could be further weakness in the stock.

Henlius (2696 HK): Musings on the Deal Break Price

By Arun George

Fosun Pharma’s HK$24.60 offer for Shanghai Henlius Biotech (2696 HK) is heading for a deal break. LVC has not changed its shareholding since amassing a blocking stake.
In the absence of a last-ditch effort by Shanghai Fosun Pharmaceutical (Group) (2196 HK) to rescue the deal, the key question is the potential deal break price.
Based on four methods, the potential deal break price is HK$17.28, 12% below the last close price of HK$19.58.

Henlius (2696 HK): So, When Was The Last Time A PE/VC Outfit Blocked A Deal?

You might have to go all the back to Guoco Group Ltd (53 HK)‘s 2012/2013 unconditional cash offer, which was ostensibly blocked by First Eagle AND Elliott Advisors.
Otherwise, it’s slim pickings. Past Schemes or Tender Offers arguably failed as minorities were simply not supportive. There are exceptions, like Soho China (410 HK) and TCM (570 HK)
IF LVC wish to remain active in this space/region, they appear to be going about it in a counterproductive way. I still don’t understand why they would want to block.

Hyundai Motor (HYUNDAI IN): Anchor Lock-Up Expiry Increases Float; Index Inclusions Near

The lock-up on the second half of the anchor investor allocation for Hyundai Motor India (HYUNDAI IN) ends after market close today and the shares will be available for sale tomorrow.
The lock-up expiry further increases free float for the stock and there will be multiple index inclusions over the next few months.
The largest index inclusion will be in February, followed by smaller inclusions in March and June. In total, passives will mop up around 16% of the float.

Delta Electronics (DELTA TB / 2308 TT): Off the Peak; SET50 Deletion Risk Increases

Delta Electronics Thailand (DELTA TB) is trading at a huge valuation premium to Delta Electronics (2308 TT), though that has narrowed over the last couple of months.
Delta Electronics Thailand has already been on the Market Surveillance list for 2 months and inclusion for another 2 months will mean SET 50 Index deletion in June.
A placement by Delta Electronics (2308 TT) is not out of the question and that further increases the downside risk for Delta Electronics Thailand (DELTA TB).

Shanghai Henlius Biotech (2696 HK)- These Are the Reasons Why LVC May Vote Against the Privatization

By Xinyao (Criss) Wang

Fosun hopes to privatize Henlius at a low price. As usual, it does not consider the interests of long-term investors, who may express their “dissatisfaction” by opposing the privatization.
Lin Lijun clearly has bargaining chips. He may ask Fosun to provide a clear plan for future relisting/asset restructuring, and how the Share Alternative will be linked to this plan.
There is a possibility this privatization may fail. Such possibility is not low, because investors will only support the privatization if they can be sure that their interests are protected.

Quiddity Leaderboard CSI 300/500 Jun 25: Large Flows; Some Inflow Names Could Outperform Index

CSI 300 represents the 300 largest stocks by market cap and liquidity from the Shanghai and Shenzhen Exchanges. CSI 500 is the next 500 names.
In this insight, we take a look at the potential ADDs and DELs leading the race for the semiannual index rebal event in June 2025.
Currently, we see 6 ADDs/DELs for the CSI 300 index and 50 ADDs/DELs for the CSI 500 index.

Lifestyle China (2136 HK): Lau’s Scheme – The Premium Is Still Wrong. And Now Final

Back on the 6th December 2024, Lifestyle China (2136 HK), a PRC department store operator, announced a Scheme from Thomas Lau, its chairman/CEO and major shareholder (74.91%, including concert parties).
The HK$0.913 Offer price was miserly 21.7% premium to last close. But not declared final.
The Offer deserved a bump, and Lau has obliged. However, the revised HK$0.98/share bid, a 30.6% premium to undisturbed, remains underwhelming. Lau has declared terms final.

TSMC Results / Guidance Beat. 2025 Capex and AI Revenue up Strongly.

By Nicolas Baratte

4Q24 beat Consensus by ~4%, 1Q25 guidance ~7% above Consensus at OP level.
2025 revenue up mid-20%. AI revenues will double or more depending on capacity bottlenecks (2023 5%, 2024 15% of total revenues). 2025 Capex US$40bn, from 2024 30bn.
The stock is trading at 18.8x 2025 and 15.8x 2026 Consensus EPS. This is cheap for the ~25% growth outlook over 2025-26.

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Jan 17

Daily Brief Energy/Materials: Halliburton Co, Venture Global LNG, YPF SA, Schlumberger Ltd, Stella Chemifa and more

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

In today’s briefing:

[Earnings Preview] Halliburton Expected to Post Subdued Q4 Results on Tepid Upstream Activity
Venture Global (VG): Rich Valuation Marks Questions About Being Already Priced for Perfection
EM Spreads – Weekly News & Views
[Pre Earnings Options Flash] Schlumberger’s OI PCR Indicates Neutral Sentiment Ahead of Q4 Results
Stella Chemifa (4109 JP) – Strong Earnings, Attractive Share Price

[Earnings Preview] Halliburton Expected to Post Subdued Q4 Results on Tepid Upstream Activity

By Suhas Reddy

Halliburton’s revenue is projected to decline 1.7% YoY, with EPS down 18.6%, driven by subdued upstream activity induced by oil price volatility and weak global demand.
Halliburton expects a 1%-3% QoQ revenue decline, and a 75-125 bps margin drop in its Completion and Production segment for Q4.
In contrast, revenue from its Drilling and Evaluation (D&E) segment is forecasted to grow between 0% to 2%, with margins flat or improving by up to 50 bps.

Venture Global (VG): Rich Valuation Marks Questions About Being Already Priced for Perfection

By IPO Boutique

Largest Cash Raise for a company since July 2024 marking important event for Equity Capital Markets to start the calendar year
Rising and volatile natural gas prices combined with rich valuation nearly prices company to perfection
Deal color for potential price sensitive IPOs is crucial in determining near-term performance

EM Spreads – Weekly News & Views

By Leandro Gubler

The LatAm Corporate Index widened by 4 bps to 317 bps in the week ended Wednesday, January 15, 2025.
YPF Priced $1.1bn Bond Due 2034 at 8.5% Yield. PEMEX Commits to Settling Supplier Debts by March
Moody’s Upgrades Ratings of Argentine Non-Financial Companies Following Country Ceiling Adjustment

[Pre Earnings Options Flash] Schlumberger’s OI PCR Indicates Neutral Sentiment Ahead of Q4 Results

By Suhas Reddy

Schlumberger will report its Q4 earnings on 17/Jan, with revenue and EPS projected to rise sequentially and annually. Analysts hold a bullish outlook despite macroeconomic challenges.
Schlumberger’s OI PCR at 0.70, signalling neutral sentiment, with an 80% IV percentile indicating high volatility.
For the 17/Jan expiry, SLB’s OI shows calls concentrated at strikes 45, 47.5, and 50, while puts dominate at 37.5, 40, and 42.5, with lower put OI at key levels.

Stella Chemifa (4109 JP) – Strong Earnings, Attractive Share Price

By Sessa Investment Research

H1 FY2025/3 results review: In H1 FY2025/3, Stella Chemifa (hereafter, the Company) reported strong results, with net sales up 25.3% YoY to JPY 18,160 mn and operating profit up 94.3% YoY to JPY 2,180 mn.
The boost in sales was driven by an increase in shipments in the semiconductor category, mainly for memory devices thanks to a recovery in market conditions, and an increase in shipments of enriched boron (energy category) for new nuclear facilities overseas.
Operating profit rose substantially, as growth in shipments in the high purity chemicals business and an increase in volume in the transportation business offset the JPY 210 mn drag on profits stemming from the Company’s inability to fully reflect cost increases from higher anhydrous hydrofluoric acid prices, a key raw material, and the yen’s depreciation, onto its prices.

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Jan 17

Daily Brief Industrials: Shanghai Electric Group Company, Wintermar Offshore Marine, Geek+, Arcadis NV and more

By Smartkarma Daily Briefs | Daily Briefs, Industrials

In today’s briefing:

Quiddity Leaderboard CSI 300/500 Jun 25: Large Flows; Some Inflow Names Could Outperform Index
Wintermar Offshore Marine (WINS IJ) – Well-Positioned for the Upcycle
Geek+ IPO Valuation Analysis: Exit Valuation Would Be Significantly Above Last Private Round of ~$2B
Arcadis NV – What’s News in Amsterdam – 16 January 2025 (Universal Music Group | AEX Index)

Quiddity Leaderboard CSI 300/500 Jun 25: Large Flows; Some Inflow Names Could Outperform Index

CSI 300 represents the 300 largest stocks by market cap and liquidity from the Shanghai and Shenzhen Exchanges. CSI 500 is the next 500 names.
In this insight, we take a look at the potential ADDs and DELs leading the race for the semiannual index rebal event in June 2025.
Currently, we see 6 ADDs/DELs for the CSI 300 index and 50 ADDs/DELs for the CSI 500 index.

Wintermar Offshore Marine (WINS IJ) – Well-Positioned for the Upcycle

By Angus Mackintosh

Wintermar Offshore Marine has seen a distinct turnaround in its fortunes over the last two years and is now well-positioned to benefit from an upcycle in the Offshore Services space.
Charter rates have started to move up in an environment with low vessel supply, especially in the high-tier space where Wintermar has most exposure with new vessels being added.
Wintermar has net cash, putting it in a strong position to increase its fleet into the upcycle driven by increased offshore exploration in Southeast Asia. Valuations remain attractive.

Geek+ IPO Valuation Analysis: Exit Valuation Would Be Significantly Above Last Private Round of ~$2B

By Andrei Zakharov

Geek+, a Beijing-based warehouse robot maker, filed to list IPO on Hong Kong Stock Exchange. The AI & robotics company plans to raise up to $200M.
Their last round was a $208M Series E1 in August 2022 that was led by Vertex Growth Fund, Intel Capital and B Capital China at a ~$2B post-money valuation.
Geek+ is growing faster than Doosan Robotics, UBTech Robotics and Shenzhen Dobot. The company will likely trade above their last private round valuation of ~$2B in August of 2022.

Arcadis NV – What’s News in Amsterdam – 16 January 2025 (Universal Music Group | AEX Index)

By The IDEA!

In this edition: • Universal Music Group | secondary listing in the US after Ackman exercises his right • AEX Index | likely to be increased to 30 companies; Aalberts, Arcadis and CVC likely to be included

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Jan 17

Daily Brief Health Care: Shanghai Henlius Biotech , Legend Biotech Corp, Natco Pharma, Roche Holding , Pfizer Inc, Beta Bionic, Shanghai Junshi Biosciences and more

By Smartkarma Daily Briefs | Daily Briefs, Healthcare

In today’s briefing:

Henlius (2696 HK): So, When Was The Last Time A PE/VC Outfit Blocked A Deal?
Legend Biotech Surges Amid Takeover Speculation—What’s Next for CARVYKTI?
The Beat Ideas: Natco Pharma, The Cheapest Pharma Stock
Liquid Universe of European Ordinary and Preferred Shares: January’25 Report
PFIZER INC. Equity Research Flash Note – December 13, 2024
Beta Bionic, Inc. (BBNX) – Medical Device Company Targeting the Insulin Market Prepares for Q1 IPO
Shanghai Junshi Bioscience (1877 HK): Key Drug on High Trajectory; Geopolitical Tension Spoils Party

Henlius (2696 HK): So, When Was The Last Time A PE/VC Outfit Blocked A Deal?

You might have to go all the back to Guoco Group Ltd (53 HK)‘s 2012/2013 unconditional cash offer, which was ostensibly blocked by First Eagle AND Elliott Advisors.
Otherwise, it’s slim pickings. Past Schemes or Tender Offers arguably failed as minorities were simply not supportive. There are exceptions, like Soho China (410 HK) and TCM (570 HK)
IF LVC wish to remain active in this space/region, they appear to be going about it in a counterproductive way. I still don’t understand why they would want to block.

Legend Biotech Surges Amid Takeover Speculation—What’s Next for CARVYKTI?

By VRS (Valuation & Research Specialists)

Legend Biotech has been making headlines with its breakthrough CAR-T therapy, CARVYKTI, which has revolutionized the treatment of multiple myeloma.
This pioneering therapy, co commercialized with Johnson & Johnson, has achieved record-setting launches and boasts a significant survival benefit over standard treatments.
The company’s robust clinical pipeline, recent partnerships, and aggressive manufacturing expansions signal strong growth potential.

The Beat Ideas: Natco Pharma, The Cheapest Pharma Stock

By Sudarshan Bhandari

Natco Pharma (NTCPH IN) is pivoting toward niche, high-value generics like Revlimid and Semaglutide, leveraging robust R&D, strategic acquisitions, and geographic expansions for long-term market leadership.
This approach combats conventional generic pricing pressures, delivers stronger profit margins, and positions Natco for sustainable, innovation-driven success in increasingly competitive regulated markets.
Natco’s willingness to tackle complex molecules and patent challenges demonstrates resilience, signaling a more diversified pipeline, prudent capital use, and potential for robust shareholder returns.

Liquid Universe of European Ordinary and Preferred Shares: January’25 Report

By Jesus Rodriguez Aguilar

Since mid-December, share-price spreads have generally tightened across European liquid universe of ordinary and preferred shares (8 have widened, 11 tightened) with few changes in the trends.
Telecom Italia savers are trading at 18.5% premium to ords; Handelsbanken B at 32.4% premium to A. The discount of Grifols B has tightened, some await a comeback from Brookfield.
Recommended trades long preferred / short ordinary shares: Atlas Copco, Grifols SA, Media-for-Europe. Recommended trades long ordinary / short preferred shares: Henkel, Roche, SSAB Svenska Stal, Telecom Italia.

PFIZER INC. Equity Research Flash Note – December 13, 2024

Our estimations for FY 2024 annual revenue range at around $62,766 million and for FY 2025 at around $63,080 million.
The company’s annual revenue was $58,496 million in 2023 compared to $100,330 million in 2022, post- ing a significant decrease by 41.7%.
Pfizer’s gross profit for FY 2023 was $33,542 million, decreased by 49.1% compared to $65,986 million for the corresponding period of 2022.

Beta Bionic, Inc. (BBNX) – Medical Device Company Targeting the Insulin Market Prepares for Q1 IPO

By IPO Boutique

ILet Bionic Pancreas Device autonomously determine every insulin dose without requiring a user to count carbohydrate intake
Revenue for the nine months ended September 30, 2024 was $44.7 million, more than 3.5x that of their annual revenue of $12.0 million for the year ended December 31, 2023.
We anticipate this company to set terms (share size, price range) in the next week for a late January / early February debut.

Shanghai Junshi Bioscience (1877 HK): Key Drug on High Trajectory; Geopolitical Tension Spoils Party

By Tina Banerjee

Shanghai Junshi Biosciences (1877 HK) reported 60% revenue growth for toripalimab during 9M24 in China. All 10 indications of the drug are now included in China’s NRDL.
Partner launched toripalimab in U.S. in January 2024 and reported ~$19M revenue for the full-year. The drug is estimated to have U.S. market opportunity of $200M for the approved indication.
Geopolitical tension remains a major overhang and may continue to be a concern for toripalimab’s further indication expansion approvals in the U.S.

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Jan 17

Daily Brief TMT/Internet: Ruijie Networks , Taiwan Semiconductor (TSMC) – ADR, Taiwan Semiconductor (TSMC), Chongqing Terminus, Xiaomi Corp, United Microelectron Sp Adr, Luxshare Precision Industry, Cellnex Telecom Sau, Wisetech Global and more

By Smartkarma Daily Briefs | Daily Briefs, TMT/Internet

In today’s briefing:

Quiddity Leaderboard ChiNext & ChiNext 50 Jun 25: Great Momentum for the Exp ADDs Vs Exp DELs Trade
TSMC 4Q24 Results Signal Multi-Year Market Share Gains; Margin Strength; Sustainable Industry Growth
TSMC Results / Guidance Beat. 2025 Capex and AI Revenue up Strongly.
TSMC (2330.TT; TSM.US): 4Q24 Results and 1Q25 Guidance; CoWoS Grows 45% CAGR; Setup of 10 Fabs WW.
Chongqing Terminus Smart Technology Pre-IPO: Deteriorating Revenue and Losing Market Share
Xiaomi Corp: China Smartphone Market—Steady Growth in 2024. Subsidy to Spur Demand in 2025
UMC (2303.TT; UMC.US): A Slightly Further Improvement 1Q25 Outlook
Tech Supply Chain Tracker (17-Jan-2025): Apple’s supply chain shifts to India and China.
Cellnex Share Repurchase Programme: Valuation and Potential Impact on Stock Price
Wisetech Global Ltd : Valuation Summary – December 13, 2024

Quiddity Leaderboard ChiNext & ChiNext 50 Jun 25: Great Momentum for the Exp ADDs Vs Exp DELs Trade

By VRS (Valuation & Research Specialists)

The ChiNext index represents the performance of the 100 largest and most liquid A-share stocks listed on the ChiNext Market of the Shenzhen Stock Exchange.
The ChiNext 50 index is a subset of the ChiNext Index and it consists of the top 50 names in the ChiNext index with the highest daily average turnover.
We see 10 changes for the ChiNext index and 5 changes for the ChiNext 50 index in the next index rebal event. Combined it is about US$1bn to trade one-way.

TSMC 4Q24 Results Signal Multi-Year Market Share Gains; Margin Strength; Sustainable Industry Growth

By Vincent Fernando, CFA

TSMC 4Q24 Gross Margin Comes In At High End of Range; Profit +57% YoY
TSMC’s Latest Strong Capex Guidance is Good News for Industry Sentiment
Long-Term Gross Margins — Will Recently High Gross Margins Become a “New Normal”?

TSMC Results / Guidance Beat. 2025 Capex and AI Revenue up Strongly.

By Nicolas Baratte

4Q24 beat Consensus by ~4%, 1Q25 guidance ~7% above Consensus at OP level.
2025 revenue up mid-20%. AI revenues will double or more depending on capacity bottlenecks (2023 5%, 2024 15% of total revenues). 2025 Capex US$40bn, from 2024 30bn.
The stock is trading at 18.8x 2025 and 15.8x 2026 Consensus EPS. This is cheap for the ~25% growth outlook over 2025-26.

TSMC (2330.TT; TSM.US): 4Q24 Results and 1Q25 Guidance; CoWoS Grows 45% CAGR; Setup of 10 Fabs WW.

By Patrick Liao

Revenue reached USD$26.88 billion (compared to guidance of 26.1-26.9 billion USD) / NTD$868.46 billion (+14.3% QoQ, +38.8% YoY); Gross margin at 59%,within the guided range of 57-59%.
Revenue expected to be in the range of USD$25-25.8 billion (-5.5% QoQ) impacted by seasonal factors, offset by AI demand. Gross margin: 57-59%.
AI revenue is expected to double in 2025. With the advancement of AI technologies, the company anticipates mid-40s CAGR for AI accelerators within a five-year period (2024-2029),

Chongqing Terminus Smart Technology Pre-IPO: Deteriorating Revenue and Losing Market Share

By Nicholas Tan

Chongqing Terminus (2471080D CH) is looking to raise about US$300m in its upcoming Hong Kong IPO.
It operates in China’s public realm AIoT (Artificial Intelligence of Things) industry.
In this note, we look at the firm’s past performance.

Xiaomi Corp: China Smartphone Market—Steady Growth in 2024. Subsidy to Spur Demand in 2025

By Devi Subhakesan

In Q4 2024, Xiaomi Corp (1810 HK) ranked fourth in China (mainland) smart phone market, achieving the highest annual growth among the top vendors at 29%.
Chinese government’s recently expanded subsidy program now covers smartphones and wearables, with a 15% subsidy for products priced under CNY6,000. This could boost demand growth in 2025.
China’s smartphone market rebounded in 2024, driven by affordable premium designs driving upgrade demand in the mass market while innovations like GenAI, foldables, and proprietary systems attracted high-end users.

UMC (2303.TT; UMC.US): A Slightly Further Improvement 1Q25 Outlook

By Patrick Liao

In 1Q25, there was a further improvement to -5% QoQ for UMC, and its gross margin is at around 26-28%.
The extra improvement is from Novatek Microelectronics Corp (3034 TT), which has also received an additional order from Vivo.
The outlook remains unclear as Samsung Electronics (005930 KS) is facing uncertainties in 2025.

Tech Supply Chain Tracker (17-Jan-2025): Apple’s supply chain shifts to India and China.

By Tech Supply Chain Tracker

Apple suppliers shifting focus to India and China for iPhone production growth, adapting supply chains to changing markets.
Jensen Huang boosting AI chip production by visiting SPIL’s new Taiwan factory; Huawei’s Mate X6 smartphone making global comeback in EMEA markets.
TSMC forecasting 5% revenue decrease in 1Q25, setting record capex for 2025; India-US tech ties in jeopardy due to export controls on AI chips.

Cellnex Share Repurchase Programme: Valuation and Potential Impact on Stock Price

By Jesus Rodriguez Aguilar

Share Repurchase Programme: EUR 800M buyback (4% of market cap) aims to cancel shares, boosting EPS and shareholder value, funded by non-core asset sales.
Valuation Insight: Current market price significantly undervalued versus EUR 42.68 consensus target and EUR 43.80 DCF valuation, offering substantial upside potential.
Strategic Alignment: Ensures financial discipline (DFN/EBITDA 5–6x target by 2025/2026) while enhancing returns via repurchase programme and increased dividend payouts from 2026 onward.

Wisetech Global Ltd : Valuation Summary – December 13, 2024

To establish a comparable universe we benchmarked and divided into tiers the 25 most comparable companies after a preliminary screen of over 2,000 technology listed companies.
To derive reliable forecast assumptions, we conducted ratios trend analysis (using income statement ratios, balance sheet common size analysis, liquidity ratio and operating statistics, leverage ratios, and additional profitability ratios) as well as a comparative ratio analysis (the same ratio analysis as per above for each company in the peer group, as presented below), which allowed us to develop multiple forecast scenarios and sense check the forecasted financials.
For the purpose of the final recommendation we used the “Upside” scenario, to show that even with optimistic forecasting assumptions, fundamentals fail to justify the current market price.

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Jan 17

Daily Brief Consumer: Lifestyle China, Hyundai Motor, Coway Co Ltd, Kalyan Jewellers, Coca-Cola Europacific Partners, Estee Lauder Companies Cl A, Toyota Motor Corp Spon Adr, Fu Shou Yuan, Trip.com and more

By Smartkarma Daily Briefs | Consumer, Daily Briefs

In today’s briefing:

Lifestyle China (2136 HK): Lau’s Scheme – The Premium Is Still Wrong. And Now Final
Lifestyle China (2136 HK): Thomas Lau Bumps, but the Offer Remains Light
Key Info We Need to Know About Boosting Predictability of Dividend Record Dates in Korea
Align Partners Goes Activist on Coway
Forensic Analysis: Kalyan Jewellers on Allegations and Rumours ~ Cause And Reality
Quiddity Leaderboard F100/F250 Mar 25: Mega Addition for Coke & Multiple Intra-Review Changes Likely
Estée Lauder: Activist Buzz & Takeover Speculations – What’s Next For The Cosmetics Giant?
Toyota’s EV Woes: Struggling To Find The Fast Lane In Electric Mobility
Fu Shou Yuan (1448 HK): Another Special Dividend Proposal
[Trip.com (TCOM US, BUY, TP US$74) Preview]: C4Q24: Thailand Kidnapping Strengthens Domestic

Lifestyle China (2136 HK): Lau’s Scheme – The Premium Is Still Wrong. And Now Final

Back on the 6th December 2024, Lifestyle China (2136 HK), a PRC department store operator, announced a Scheme from Thomas Lau, its chairman/CEO and major shareholder (74.91%, including concert parties).
The HK$0.913 Offer price was miserly 21.7% premium to last close. But not declared final.
The Offer deserved a bump, and Lau has obliged. However, the revised HK$0.98/share bid, a 30.6% premium to undisturbed, remains underwhelming. Lau has declared terms final.

Lifestyle China (2136 HK): Thomas Lau Bumps, but the Offer Remains Light

By Arun George

Lifestyle China (2136 HK) disclosed a revised offer from Mr Thomas Lau at HK$0.98 per share, a 7.3% premium to the previous HK$0.913 offer. The offer has been declared final.
The bump was unsurprising. Crucially, the shares have traded above the revised offer on 20 of the 25 trading days since the previous offer was announced.
The revised offer remains light, and minorities remain unimpressed. The high AGM minority participation rates remain a vote risk. Head for the exit as the shares are trading at terms.

Key Info We Need to Know About Boosting Predictability of Dividend Record Dates in Korea

By Sanghyun Park

Major banks, Hyundai Motor, POSCO Holdings, and companies like HMM, which updated their articles, will likely set dividend record dates pre-AGM in the mid-to-late February window.
Track backwardation in March futures for mispricings. Companies will likely follow last year’s playbook: AGM in mid-to-late March, record date 3–4 weeks prior, announcement 2 weeks ahead.
Opportunity lies in the March futures basis spread between February contract and record date announcement. Watch those for potential dividend hikes and futures mispricing ahead.

Align Partners Goes Activist on Coway

By Douglas Kim

After the market close on 16 January, it was reported that Align Partners started to go activist on Coway Co Ltd (021240 KS).
Align Partners sent a public letter to Coway demanding improvements to shareholder returns and measures to enhance the independence of the board of directors.
The combination of higher shareholder returns, low valuations, and Align Partners putting further activist pressure are likely to lead to continued outperformance of Coway relative to KOSPI this year.

Forensic Analysis: Kalyan Jewellers on Allegations and Rumours ~ Cause And Reality

By Nimish Maheshwari

Steep decline in the stock price triggered a wave of speculation and rumours, further fueling the negative sentiment surrounding Kalyan Jewellers (KALYANKJ IN).
The rumours ranged from serious allegations of inventory overvaluation and IT raids to concerns about changes in franchisee agreements and even accusations of bribery.
While Kalyan Jewellers (KALYANKJ IN) has dismissed the overvaluation allegations, its inventory turnover ratio (ITR) has consistently lagged behind the industry leader Titan Co Ltd (TTAN IN) .

Quiddity Leaderboard F100/F250 Mar 25: Mega Addition for Coke & Multiple Intra-Review Changes Likely

In this insight, we take a look at the potential index changes for the F100 and F250 indices in the run-up to the March 2025 index rebal event.
We see up to four M&A-related intra-review changes in the run up to the March 2025 review.
Our latest estimates suggest there could be one regular change for the F100 index and one change for the F250 index during the March 2025 rebalance.

Estée Lauder: Activist Buzz & Takeover Speculations – What’s Next For The Cosmetics Giant?

Estée Lauder Companies, a titan in the global cosmetics industry, has recently found itself at the epicenter of takeover and activist speculation.
Reports have reignited discussions about potential acquisition interest and the involvement of activist investors.
Betaville’s “uncooked” alert suggested renewed whispers of a takeover, while past rumors linked activist investor Nelson Peltz to Estée Lauder, although significant hurdles persist given the family’s control over the company.

Toyota’s EV Woes: Struggling To Find The Fast Lane In Electric Mobility