Smartkarma Daily Briefs

The Sep 2024 Nikkei 225 Review base date is six weeks away. One can no extrapolate results quite accurately. It still gives us one ADD, one DELETE, and capping fun.
Recently, Yanai-san sold more Fast Retailing (9983 JP). More active holders own more stock (which may mean less interest to buy later), and only 1% to go to avoid capping.
There should be one DELETE, one ADD. There is a low-probability Dark Horse ADD but I expect Kokusai Electric (6525) to be added in March 2025.

Hengdeli Holdings (3389 HK)’s Pitiful Partial Offer

By Small Cap Consumer Research

After watch accessory play Hengdeli Holdings (3389 HK) was suspended on the 17th June pursuant to the Takeovers Code, I didn’t hold out high hopes of a knock-out Offer.
And on cue, CEO Tony Cheung (16%), son of founder Zhang Yuping (holding 17%), has made a Partial Offer (for 15% of shares outstanding) at HK$0.16/share, towards gaining majority control.
That’s a 18.5% premium to last close … and a 80% discount to NAV, and a 47% discount to Hengdeli’s net cash as at 31 December 2023.

Sa Sa Intl (178 HK): Every Coin Has Two Sides

By Osbert Tang, CFA

Despite missing market consensus, Sa Sa International Hldgs (178 HK)‘s FY24 result still have silver linings. Its resumption of dividends with a 70% payout ratio is welcoming.
Tax credit in 2H23 has distorted comparison. At pre-tax level, 2H24 profit has gone up by 29.5%. Cost management is solid, generating a 0.9pp FY24 operating margin expansion.
While overall 1Q25 sales have dropped, mainland China sales surged 83.9%. The macro environment should have bottomed and government efforts to attract tourists will pay off.

Hyundai Motor India: Can It Thrive Amidst a Rapidly Evolving Mobility Landscape?

By Devi Subhakesan

India’s passenger vehicle industry is shifting towards alternative fuels and facing intense competition, amidst changing customer preferences.
Despite a growing vehicle market, Hyundai Motor India (HMIL) faces a tough battle to defend its market share given changing industry dynamics.
With more competitors in the fray, including its parent group company Kia and EV leader BYD, Hyundai Motor India is in for a challenging ride.

J&J Snack Foods Corp.: Initiation Of Coverage – Growth from Branded Products & 3 Other Major Drivers

By Baptista Research

The first quarter earnings of J&J Snack Foods Corporation (J&J) highlights several aspects of the company’s financial health and operational performance.
The company’s Q1 2024 results were influenced by a challenging consumer environment, with many customers witnessing yearly declines in consumer traffic and consumption.
To counteract these trends, J&J leveraged its popular brands to optimize sales opportunities, resulting in less than a 1% sales decline.

Adient plc: Initiation Of Coverage – What Is Its Business Strategy & How Is It Growing In China? – Major Drivers

By Baptista Research

This is our first report on Adient, a global leader in automotive seating.
The company has continued to focus on business performance, launch execution, and continuous improvement in FY 2024.
Some highlights in the first fiscal quarter of 2024 include a total revenue of $3.7 billion, a slight decrease compared to the previous year’s first quarter, and an adjusted EBITDA totalling $216 million, reflecting an increase of 2%.

Kontoor Brands: Initiation Of Coverage – Are Its DTC & Tech Investments Yielding The Necessary Results? – Major Drivers

By Baptista Research

This is our first report on apparel major, Kontoor Brands Inc. The company released its financial results for the fourth quarter and fiscal year 2023 in its recent earnings conference call.
The company’s Vice President, President, Chief Executive Officer, Co-Chief Operating Officer, and Chief Financial Officer were on the call to provide insights on Kontoor’s business accomplishments and forecasts.
One crucial undertaking announced in the conference call was Project Jeanius.

Pvh Corp – VNCE: 1Q Review: Multiple Positives Coming to the Fore; Reiterate Buy, $3 PT

We are reiterating our Buy rating and $3 price target for Vince Holding Corp. after the company reported slightly better-than expected 1QFY24 (April) results and reiterated FY24 guidance.
We believe, as the Vince operating model continues to normalize in FY24, it will become increasingly clear to investors the material positives at Vince, from a focus on full price selling, strong wholesale order book, continuing emphasis on higher overall returns and a strengthening balance sheet, which we believe will drive a higher valuation for VNCE, especially with momentum ramping even higher from a “normalized” 2HFY24.
As such, we reiterate our Buy rating and $3 price target for VNCE.

Abercrombie & Fitch Co Cl A – AKA: Snapping the Store: Building Unique Brands; Retierate Buy, $25 PT

By Small Cap Consumer Research

We are reiterating our Buy rating, $25 price target and projections of a.k.a. Brands after touring the company’s Culture Kings store in Las Vegas and Princess Polly unit in Los Angeles.
We believe both locations represent impressive retail units which will allow for continued growth (and high returns) going forward, as a.k.a. expands their retail footprint, with three new Princess Polly stores on track for a 2H24 opening.
As such, we remain excited by the potential for the ongoing turn at the company, which we believe will be even further driven by continued retail expansion, and reiterate our Buy rating and $25 price target for AKA.

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Jun 21

Most Read: Mcdonald’s Japan, SBI Sumishin Net Bank , Mimasu Semiconductor Industry, Mizuho Financial Group, Tatsuta Electric Wire & Cable, Mma Offshore, SK Innovation, SenseTime Group , Ryohin Keikaku and more

By Smartkarma Daily Briefs | Daily Briefs, Most Read

In today’s briefing:

JPX Proposes BIG Changes To TOPIX Rules, Affects IPOs More Than Market
TOPIX Market Consultation: Wider Next-Gen Universe in a Couple of Years; But Stocks Moving Already
Shin-Etsu Chem TOB for Rest of Mimasu Semi (8155) – Far Too Cheap, But No Squeaky Wheel No Grease
Mizuho Cross-Shareholding – US$11bn of Cross-Shareholding, with at Least US$2bn to Sell over FY24-26
Tatsuta Electric (5809 JP): Eneos Refuses to Bump, Board Capitulates
MMA Offshore (MRM AU): Cyan Lifts Offer
ENEOS Launches Tatsuta Elec (5809) “Minority” Takeout at Same Price as 18mos Ago
Digging into Chosun Ilbo’s Report on SK Group’s SK Innovation & SK E&S Merger Plans
Sensetime Placement – Seems Highly Opportunistic
Sep24 Nikkei 225 Rebal – Still 1 ADD, 1 DELETE, 1 Dark Horse, But #2-Ranked ADD Is Close

JPX Proposes BIG Changes To TOPIX Rules, Affects IPOs More Than Market

In 2021 the JPX established new Listing Rules, and in April 2022 introduced new market segments (Prime/Standard/Growth) to much fanfare. Today, the TSE basically said those changes were meaningless.
Today, the TSE announced proposed new rules for TOPIX constituent selection. There is a 2-month consultation period, then rules come out end-Sep 2024. Expect few changes from the Proposal.
NextGen TOPIX will be created October 2026. 3-4 dozen ADDs, 500-600 DELETEs to create an index of 1,100-1,200 names. Some obvious large impacts 2+yrs from now, but this changes IPOs.

TOPIX Market Consultation: Wider Next-Gen Universe in a Couple of Years; But Stocks Moving Already

By Brian Freitas

JPX has commenced a market consultation on changes to the TSE Tokyo Price Index TOPIX (TPX INDEX) including expansion of the universe and periodic stock selection.
Based on current market cap/ liquidity, there could be 38 adds and 447 deletions for the TSE Tokyo Price Index TOPIX, though the changes only start in October 2026.
The deletions will be phased out of the index in 8 steps that will end in July 2028 and most of the stocks will move to the TOPIX Next-tier.

Shin-Etsu Chem TOB for Rest of Mimasu Semi (8155) – Far Too Cheap, But No Squeaky Wheel No Grease

Shin Etsu Chemical (4063 JP), owner of a 44% stake in Mimasu Semiconductor Industry (8155 JP), will launch the TOB to buy out Mimasu minority holders, as pre-announced 2mos ago.
Not surprising. They bought in 19yrs ago, raised to 40+% 18yrs ago, then waited. Finally, we have a deal. It’s too cheap but in 18yrs, I recall zero activism here.
Shin-Etsu starts with ~45%, and crossholders and the chairman get it to 53%. Then they need a bit to get them to 67% but it should be straightforward.

Mizuho Cross-Shareholding – US$11bn of Cross-Shareholding, with at Least US$2bn to Sell over FY24-26

Following up on our earlier cross-shareholding notes, in this note we look at Mizuho Financial Group (8411 JP)‘s cross-shareholding.
Mizuho had a stake over US$100m in at least 34 listed Japanese stocks, amounting to a total of around US$7bn.
In this note, we take a look at its stakes in various companies to see which ones could possibly be candidates for further selldowns.

Tatsuta Electric (5809 JP): Eneos Refuses to Bump, Board Capitulates

By Arun George

18 months after announcing the offer, ENEOS Holdings (5020 JP) launched the Tatsuta Electric Wire & Cable (5809 JP) tender offer at unchanged JPY720, 4.9% below the last close price.
The Board requested a bump, but Eneos refused due to Tatsuta’s missed targets, no competing offer and the supportive updated IFA valuation
The lack of a bump, no vocal opposition, deal fatigue, the Board’s unexpected recommendation, weak earnings and 73.9% takeover premium will help acceptance.

MMA Offshore (MRM AU): Cyan Lifts Offer

Back on 25 March, marine and subsea services provider MMA Offshore (MRM AU) entered into a Scheme with Singapore’s Cyan Renewables, a wholly-owned vehicle of Seraya Partners.
The A$2.60/share Offer in cash, a 11% premium to last close, was within the IE’s fair value range of A$2.03 to A$2.83. However, shares have consistently traded through terms.
Cyna has now bumped the Offer to A$2.70/share – best & final. Thorney (7.95% of shares out) is supportive. The Scheme Meeting will still be held on the 1 July.

ENEOS Launches Tatsuta Elec (5809) “Minority” Takeout at Same Price as 18mos Ago

ENEOS announced its deal for Tatsuta Electric Wire & Cable (5809 JP) 18mos ago. China approval took a while. Now they have launched.
The TOPIX Non-Ferrous Metals sector has returned 60%. TOPIX 50%. There is a new TSE Sheriff in town asking for PBR 1.0x. BVPS is up. Presumably, forward CF is up.
But the TOB Price is unchanged. That is disappointing. One reason why a higher price was rejected was that no other buyer approached to take over the company.

Digging into Chosun Ilbo’s Report on SK Group’s SK Innovation & SK E&S Merger Plans

By Sanghyun Park

SK Group plans to merge SK Innovation and 90%-owned SK E&S by month-end. Chosun Ilbo’s report solidifies market confidence due to its credibility and likely intentional leak by SK Group.
Initially considered but deemed lower priority than SK IE Technology sale; SK Group opts for this alternative due to challenging market conditions for SKITE sale.
SK Innovation and SKIET rise with hopes of resolving liquidity issues and avoiding sacrifice. SK Inc is negatively impacted by concerns over valuation double counting from this merger.

Sensetime Placement – Seems Highly Opportunistic

SenseTime Group (20 HK) aims to raise up to US$263m via selling around 4.5% stake.
Sensetime hasn’t had the best of times since listing, however, the shares have rebounded recently on generative AI buzz around the stock.
In this note, we will talk about the placement and run the deal through our ECM framework.

Sep24 Nikkei 225 Rebal – Still 1 ADD, 1 DELETE, 1 Dark Horse, But #2-Ranked ADD Is Close

The Sep 2024 Nikkei 225 Review base date is six weeks away. One can no extrapolate results quite accurately. It still gives us one ADD, one DELETE, and capping fun.
Recently, Yanai-san sold more Fast Retailing (9983 JP). More active holders own more stock (which may mean less interest to buy later), and only 1% to go to avoid capping.
There should be one DELETE, one ADD. There is a low-probability Dark Horse ADD but I expect Kokusai Electric (6525) to be added in March 2025.

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Jun 20

Daily Brief Quantitative Analysis: KRX Short Interest Weekly (Jun 14th): L&F and more

By Smartkarma Daily Briefs | Daily Briefs, Quantitative Analysis

In today’s briefing:

KRX Short Interest Weekly (Jun 14th): L&F, Samsung SDI, Samsung C&T, Sk Hynix, Hyundai Motor
Garrett DeSimone, Head of Quantitative Research at OptionMetrics

KRX Short Interest Weekly (Jun 14th): L&F, Samsung SDI, Samsung C&T, Sk Hynix, Hyundai Motor

By Ke Yan, CFA, FRM

We analyzed the changes in short interest of KRX Stocks as of Jun 14th which has an aggregated short interest worth USD5.8bn.
We tabulate league table for top short by value and short as multiple of ADT, as well as weekly increases & decreases in short value, short as multiple of ADT.
We highlight short interest changes in L&F, Samsung SDI, Samsung C&T, Sk Hynix, Hyundai Motor.

Garrett DeSimone, Head of Quantitative Research at OptionMetrics

By Alpha Exchange

Dissertation findings show that earnings event risk premium for single stocks makes straddles punitive to own
Discussion on inflated S&P 500 implied volume levels before macro events like CPI, nonfarm payrolls report, and FOMC meetings
Recent work on implied dividends shows very little risk premium in dividends, market charging almost nothing for bearing risk of disappointing dividends

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Jun 20

Daily Brief ESG: The Key to Higher Valuations for Mid-To-Small Caps Is Management’s Strong Will to Achieve Its Goals and more

By Smartkarma Daily Briefs | Daily Briefs, ESG

In today’s briefing:

The Key to Higher Valuations for Mid-To-Small Caps Is Management’s Strong Will to Achieve Its Goals

The Key to Higher Valuations for Mid-To-Small Caps Is Management’s Strong Will to Achieve Its Goals

By Aki Matsumoto

Even companies with high valuations and return on capital have room to further raise their return on capital and valuations because of cash allocation challenges.
Companies whose valuations have not changed over the past year have low ROE and ROA, yet have high policy shareholdings. They have not taken steps to improve return on capital.
As for whether many companies without high foreign ownership can raise their return on capital and valuations, strong will of management to achieve their goals is necessary.

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Jun 20

Daily Brief Thematic (Sector/Industry): Hong Kong Property: In Need Of A Good Story and more

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

In today’s briefing:

Hong Kong Property: In Need Of A Good Story
Ohayo Japan | Lower Open After US Holiday
#21Business Buzz: ABD $180 Mn IPO, State Owned Banks Sell Bonds, K29 Secures $120 Mn Loan

Hong Kong Property: In Need Of A Good Story

When property advisors (JLL, Knight Frank, CBRE etc) debate the bottom of Hong Kong’s office/retail market, such commentary is often infused with cautious optimism.
And for good reason, as vacancies increase, and rents soften.
Recent press articles and anecdotal evidence suggests market uncertainty lingers, prompting landlords to (further) assess their stance on rents.

Ohayo Japan | Lower Open After US Holiday

By Mark Chadwick

US Stock market closed for holiday; Nikkei Futures close at a 0.5% discount to cash suggesting a lower open.
Approximately 900 listed companies, or 40%, plan to raise dividends in the fiscal year ending March 2025, totaling an 8% increase to about ¥18 trillion.
Toyota Chairman Akio Toyoda saw a drop in shareholder support, falling to 72% from 85% last year

#21Business Buzz: ABD $180 Mn IPO, State Owned Banks Sell Bonds, K29 Secures $120 Mn Loan

By Nimish Maheshwari

Indian Whiskey Maker Allied Blenders & Distillers Sets Terms for $180 Million IPO
Indian State-Owned Banks Sell Bonds as Foreign Demand Surges Ahead of Index Inclusion
K92 Mining Expands Loan and Offtake Agreement with Trafigura to Advance Kainantu Operations

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Jun 20

Daily Brief ECM: Webtoon Entertainment IPO – Further Thoughts on Valuation – Acquisitions and more

By Smartkarma Daily Briefs | Daily Briefs, ECM

In today’s briefing:

Webtoon Entertainment IPO – Further Thoughts on Valuation – Acquisitions, Buyouts
Guzman Y Gomez IPO Trading – Strong Demand, Not All Shares in Escrow
Innospace IPO Bookbuilding Results Analysis
Black Sesame Pre-IPO – PHIP Updates – Unable to Shake off Its Loss-Making Tendencies
Bajaj Housing Finance Pre-IPO – The Negatives – Carrying More Risky Loans
Bloks Group IPO: Exceptional Revenue Hyper-Growth and Profitability Are Unique Among Toy Makers
Telix Pharmaceuticals (TLX AU): Nasdaq IPO Plan Dropped; Future Growth Prospect Remains Intact
Pre-IPO Soft International Group – Whether Performance Growth Can Be Sustained Is a Question Mark

Webtoon Entertainment IPO – Further Thoughts on Valuation – Acquisitions, Buyouts

By Ethan Aw

Webtoon Entertainment (WBTN US) is looking to raise up to US$315m in its US IPO, down from an earlier reported float of US$500m.
Webtoon Entertainment is a global storytelling platform where a community of creators and users discover, create and share new content.
In our previous notes, we talked about the company’s historical performance, undertook a peer comparison and shared our thoughts on valuation. In this note, we share additional thoughts on valuation.

Guzman Y Gomez IPO Trading – Strong Demand, Not All Shares in Escrow

Guzman Y Gomez raised around US$221m in its upsized Australian IPO.
GYG is a quick service restaurant business with more than 200 restaurants globally. It mainly focuses on fresh, made-to-order, Mexican-inspired food.
We have looked at the company’s performance and valuation in our past notes. In this note, we talk about the trading dynamics.

Innospace IPO Bookbuilding Results Analysis

By Douglas Kim

Innospace reported solid IPO bookbuilding results. Innospace’s IPO price has been determined at 43,300 won won, which is at the high end of the IPO price range.
Our base case valuation of Innospace is target price of 51,481 won per share (12 month view), which is 19% higher than the IPO price.
Innospace is involved in the satellite launch vehicle production and launch service business.

Black Sesame Pre-IPO – PHIP Updates – Unable to Shake off Its Loss-Making Tendencies

By Clarence Chu

Black Sesame Technologies (BLACKSES HK) is looking to raise around US$300m in its upcoming Hong Kong IPO.
Black Sesame International Holdings (BSIH) is an automotive-grade computing SoC and SoC-based intelligent vehicle solution provider.
In our previous note we looked at the company’s past performance. In this note, we discuss Black Sesame’s PHIP updates.

Bajaj Housing Finance Pre-IPO – The Negatives – Carrying More Risky Loans

Bajaj Housing Finance (BHF IN) is looking to raise around US$830m in its upcoming India IPO.
BHF is a non-deposit taking housing finance company engaged in mortgage lending since FY18. Its mortgage products include home loans, loans against property, lease rental discounting and developer financing.
In this note, we talk about the not-so-positive aspects of the deal.

Bloks Group IPO: Exceptional Revenue Hyper-Growth and Profitability Are Unique Among Toy Makers

By Andrei Zakharov

Bloks Group, a fast-growing toy company and leader of assembly character toys, filed for a Hong Kong IPO. The company is headquartered in Shanghai, PRC, and has 410 full-time employees.
Bloks Group has raised $200M+ to date from investors, including YF Capital, Legend Capital, Source Code Capital, Gaorong Capital and SinoMedia Asia Pacific.
The Chinese toy maker has delivered an exceptional revenue hyper-growth of 169% y/y in 2023. Elite operating metrics and impressive financial profile make IPO attractive for investors.

Telix Pharmaceuticals (TLX AU): Nasdaq IPO Plan Dropped; Future Growth Prospect Remains Intact

By Tina Banerjee

Telix Pharmaceuticals (TLX AU) has withdrawn its proposed IPO in the U.S. due to unfavorable market condition. The proposed Nasdaq listing was not predicated on the need to raise capital.
As a profitable, cash generative company, Telix is confident that its existing and upcoming cash resources will be sufficient to meet R&D and commercialization needs.
Following the successful commercial launch of Illuccix, Telix has demonstrated its ability to develop and commercialize innovative product portfolio, which should accelerate its growth trajectory.

Pre-IPO Soft International Group – Whether Performance Growth Can Be Sustained Is a Question Mark

By Xinyao (Criss) Wang

The top two biggest markets of Soft International (China and Russia) are encountering the challenge of slowing growth or even growth stagnation due to decreasing birth rate and increasing competition.
Single-Digit net profit margin is not satisfactory for a company with strong consumption attributes. This makes us wonder if the personal hygienic disposables is not a money-making business.
Overreliance on Russian Top-tier Retailer would bring risks to the business.Both revenue growth and profitability could decrease sharply if adverse situations occur. Soft International’s valuation could be lower than peers.

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Jun 20

Daily Brief Credit: Morning Views Asia: and more

By Smartkarma Daily Briefs | Credit, Daily Briefs

In today’s briefing:

Morning Views Asia:

Morning Views Asia:

By Leonard Law, CFA

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

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Jun 20

Daily Brief Australia: Guzman Y Gomez, Capitol Health, Mma Offshore, Telix Pharmaceuticals and more

By Smartkarma Daily Briefs | Australia, Daily Briefs

In today’s briefing:

Guzman Y Gomez IPO: Listing & Index Inclusion Timeline
Capitol Health (CAJ AU): All-Scrip Non-Binding Merger with Integral Diagnostics
Guzman Y Gomez IPO Trading – Strong Demand, Not All Shares in Escrow
MMA Offshore (MRM AU): Cyan Lifts Offer
Telix Pharmaceuticals (TLX AU): Nasdaq IPO Plan Dropped; Future Growth Prospect Remains Intact

Guzman Y Gomez IPO: Listing & Index Inclusion Timeline

By Brian Freitas

Guzman Y Gomez (0817833D AU) has raised A$335.1m in a primary + secondary offering, valuing the company at A$2.23bn. The stock starts trading on the ASX Ltd (ASX AU) today.
Just over 54% of the shares are escrowed which means there is a lot of stock that will be available for sale on listing day.
Guzman Y Gomez (0817833D AU) could be added to the S&P/ASX 300 Index in September and there could be global index inclusions in November and December.

Capitol Health (CAJ AU): All-Scrip Non-Binding Merger with Integral Diagnostics

By Arun George

On 17 June, Capitol Health (CAJ AU) disclosed a non-binding merger proposal from Integral Diagnostics (IDX AU) at 0.12849 Integral shares per Capitol share.
Integral has been granted a four-week exclusivity period that ends on 15 July. The transaction will require approval from the ACCC and Capitol shareholders.
The offer is attractive compared to historical exchange ratios, trading ranges and peer multiples. At the last close, the gross spread was 11.7%.

Guzman Y Gomez IPO Trading – Strong Demand, Not All Shares in Escrow

Guzman Y Gomez raised around US$221m in its upsized Australian IPO.
GYG is a quick service restaurant business with more than 200 restaurants globally. It mainly focuses on fresh, made-to-order, Mexican-inspired food.
We have looked at the company’s performance and valuation in our past notes. In this note, we talk about the trading dynamics.

MMA Offshore (MRM AU): Cyan Lifts Offer

By Analyse Asia with Bernard Leong

Back on 25 March, marine and subsea services provider MMA Offshore (MRM AU) entered into a Scheme with Singapore’s Cyan Renewables, a wholly-owned vehicle of Seraya Partners.
The A$2.60/share Offer in cash, a 11% premium to last close, was within the IE’s fair value range of A$2.03 to A$2.83. However, shares have consistently traded through terms.
Cyna has now bumped the Offer to A$2.70/share – best & final. Thorney (7.95% of shares out) is supportive. The Scheme Meeting will still be held on the 1 July.

Telix Pharmaceuticals (TLX AU): Nasdaq IPO Plan Dropped; Future Growth Prospect Remains Intact

By Tina Banerjee

Telix Pharmaceuticals (TLX AU) has withdrawn its proposed IPO in the U.S. due to unfavorable market condition. The proposed Nasdaq listing was not predicated on the need to raise capital.
As a profitable, cash generative company, Telix is confident that its existing and upcoming cash resources will be sufficient to meet R&D and commercialization needs.
Following the successful commercial launch of Illuccix, Telix has demonstrated its ability to develop and commercialize innovative product portfolio, which should accelerate its growth trajectory.

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Jun 20

Daily Brief Equity Bottom-Up: How Netflix bring Asian Content to the Global Audience with Minyoung Kim and more

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

In today’s briefing:

How Netflix bring Asian Content to the Global Audience with Minyoung Kim
Episode 72: Apple Intelligence and Closed Loop Private Computing
Recent Sell-Off in Tanker Stocks Provides an Opportunity in Cosco Shipping Energy – 1138.HK
West China Cement (2233 HK): African Cement Play At 4x 2024E PE
Money Forward (3994) | Looking Forward to Q2
Tech Supply Chain Tracker (20-Jun-2024): Fujitsu launches new AI customization platform.
Exor CEO John Elkann: Family Ownership, Football and Ferrari
Japanese Regional Banks – Adding a Smaller Cap to Our Key Positive Picks
Monthly Container Shipping Tracker | Pricing Surged in May | Did Volume Growth Wobble? | (June 2024)
Iron Mountain (IRM) – Wednesday, Mar 20, 2024

How Netflix bring Asian Content to the Global Audience with Minyoung Kim

Understanding the audience is the number one rule in content creation and building relationships is important globally
Min Yong Kim started her career in food and nutrition but transitioned to the entertainment industry, eventually joining Netflix
Lessons learned include the importance of knowing your audience and the shift in thinking about content from traditional media to digital platforms

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

Episode 72: Apple Intelligence and Closed Loop Private Computing

By The Circuit

Apple announced Apple intelligence, integrating AI in a feature-centric way for on-device use
The approach focused on useful features rather than spotlighting AI technology
Apple’s implementation of AI on iPhone 15 Pro and newer devices showcases their focus on personal intelligence and user-centric design

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

Recent Sell-Off in Tanker Stocks Provides an Opportunity in Cosco Shipping Energy – 1138.HK

By Rikki Malik

All the business fundamentals continue to trend in the right direction
The sector has sold off with the general commodity sell-off
Investors not giving the benefit of the doubt to future oil demand

West China Cement (2233 HK): African Cement Play At 4x 2024E PE

By Steve Zhou, CFA

West China Cement (2233 HK) is a cement company based in Western China. Sales volume in Africa in 2023 was 2.6 million tons, up 117% from 1.2 million tons in 2022.
The company has 2 million tons of cement capacity in Mozambique, 1.5 million tons in Congo, and 1.3 million tons in Ethiopia.
The company is trading at 4x 2024E PE. I believe the risk reward is quite high here.

Money Forward (3994) | Looking Forward to Q2

By Mark Chadwick

Money Forward’s share price has declined by around 16% since reporting Q1 results.
The company will report Q2 results in early July. We expect continued solid momentum
We believe the stock price has around 30% upside potential to our target price of ¥6,600

Tech Supply Chain Tracker (20-Jun-2024): Fujitsu launches new AI customization platform.

By Tech Supply Chain Tracker

Fujitsu launches GenAI platform for advanced AI capabilities, enhancing customization options for users.
CuspAI receives US$30M funding, partners with Geoffrey Hinton to address climate change using advanced materials.
Global IC fab capacity expected to grow by 6% in 2024 and 7% in 2025, with Taiwan playing a key role in AI innovation.

Exor CEO John Elkann: Family Ownership, Football and Ferrari

By In Good Company with Nicolai Tangen

Practice of committing to ownership, governance, and leadership alignment with companies similar to other respected examples like Berkshire Hathaway and the Walnbergs in Sweden
Focus on long-term thinking, staying current through innovation, and renewing oneself to ensure enduring success in business
Importance of family ownership, stability, and long-term thinking in combination with the benefits of being a public company; John Elkann’s background and path to leadership within the family-owned company.

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Japanese Regional Banks – Adding a Smaller Cap to Our Key Positive Picks

By Victor Galliano

We update twelve Japanese regional banks, and add two new names, to target beneficiaries of the improving interest rate outlook; also banks with attractive credit quality, capital adequacy and valuations
We identify the value of equity holdings for disposal among these banks; the lack of near-term easing prospects at the US Fed should support JGB yields and domestic bank valuations
We add smaller cap Juroku Financial to our buy list of Tokyo Kiraboshi Financial, Gunma Bank and higher risk option Suruga Bank

Monthly Container Shipping Tracker | Pricing Surged in May | Did Volume Growth Wobble? | (June 2024)

By Daniel Hellberg

Deep-Sea container rates surged in May, yielding best read since June 2022
But volume growth into North American WC ports slowed noticeably…
We believe Q224 results will impress, and still like our Long/Short pairs

Iron Mountain (IRM) – Wednesday, Mar 20, 2024

By Value Investors Club

Short recommendation for IRM due to reliance on core document storage business and highly leveraged balance sheet
Weak cash flow generation and recurring addbacks in adjusted metrics make stock appear more expensive than it is
Concerns about terminal value and ability to meet cash needs raise doubts about long-term viability of the business

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

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Jun 20

Daily Brief Event-Driven: JPX Proposes BIG Changes To TOPIX Rules and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

JPX Proposes BIG Changes To TOPIX Rules, Affects IPOs More Than Market
Guzman Y Gomez IPO: Listing & Index Inclusion Timeline
Hyundai Motor’s Special Shareholder Return Plan Likely Unveiled in August IR Event
Capitol Health (CAJ AU): All-Scrip Non-Binding Merger with Integral Diagnostics
Another Major Win for Eoflow [U.S. Federal Appeals Court Issues a Decision]
Mizuho Cross-Shareholding – US$11bn of Cross-Shareholding, with at Least US$2bn to Sell over FY24-26
MMA Offshore (MRM AU): Cyan Lifts Offer

JPX Proposes BIG Changes To TOPIX Rules, Affects IPOs More Than Market

In 2021 the JPX established new Listing Rules, and in April 2022 introduced new market segments (Prime/Standard/Growth) to much fanfare. Today, the TSE basically said those changes were meaningless.
Today, the TSE announced proposed new rules for TOPIX constituent selection. There is a 2-month consultation period, then rules come out end-Sep 2024. Expect few changes from the Proposal.
NextGen TOPIX will be created October 2026. 3-4 dozen ADDs, 500-600 DELETEs to create an index of 1,100-1,200 names. Some obvious large impacts 2+yrs from now, but this changes IPOs.

Guzman Y Gomez IPO: Listing & Index Inclusion Timeline

By Brian Freitas

Guzman Y Gomez (0817833D AU) has raised A$335.1m in a primary + secondary offering, valuing the company at A$2.23bn. The stock starts trading on the ASX Ltd (ASX AU) today.
Just over 54% of the shares are escrowed which means there is a lot of stock that will be available for sale on listing day.
Guzman Y Gomez (0817833D AU) could be added to the S&P/ASX 300 Index in September and there could be global index inclusions in November and December.

Hyundai Motor’s Special Shareholder Return Plan Likely Unveiled in August IR Event

By Sanghyun Park

Hyundai’s IR team appears to have communicated that a new shareholder return policy would be unveiled at the rescheduled CEO Investor Day in August.
Hyundai aims to boost shareholder returns above 30% by canceling ₩800B to ₩1T in shares annually. The new dividend strategy won’t debut in August; last year’s three-year plan stands.
Equal cancellation ratios apply to common and three types of preferred shares. August’s timing, with ISA tax reforms potentially favoring preferred shares, may enhance prefs’ price impact relative to ords.

Capitol Health (CAJ AU): All-Scrip Non-Binding Merger with Integral Diagnostics

By Arun George

On 17 June, Capitol Health (CAJ AU) disclosed a non-binding merger proposal from Integral Diagnostics (IDX AU) at 0.12849 Integral shares per Capitol share.
Integral has been granted a four-week exclusivity period that ends on 15 July. The transaction will require approval from the ACCC and Capitol shareholders.
The offer is attractive compared to historical exchange ratios, trading ranges and peer multiples. At the last close, the gross spread was 11.7%.

Another Major Win for Eoflow [U.S. Federal Appeals Court Issues a Decision]

By Douglas Kim

On 19 June, Eoflow announced that the U.S. Federal Appeals Court issued a decision to overturn the provisional injunction.
In other words, the U.S. federal court ordered the first trial’s preliminary injunction banning overseas sales of Eoflow to be overturned.
A jury trial is set at end of November 2024. Depending on the ruling, either side may appeal and a second trial may follow or there may be a settlement.

Mizuho Cross-Shareholding – US$11bn of Cross-Shareholding, with at Least US$2bn to Sell over FY24-26

Following up on our earlier cross-shareholding notes, in this note we look at Mizuho Financial Group (8411 JP)‘s cross-shareholding.
Mizuho had a stake over US$100m in at least 34 listed Japanese stocks, amounting to a total of around US$7bn.
In this note, we take a look at its stakes in various companies to see which ones could possibly be candidates for further selldowns.

MMA Offshore (MRM AU): Cyan Lifts Offer