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Smartkarma Daily Briefs

Sep 18
0

Daily Brief Energy/Materials: Adaro Energy, Endurance Gold, ADX Energy Ltd and more

By | Daily Briefs, Energy & Materials Sector

In today’s briefing:

  • Adaro Energy (ADRO IJ) – The Sustainable Leap
  • EDG: First 2024 Drill Results: All Holes Intercept High-Grade
  • ADX Energy (ASX: ADX): Production Boost at Anshof in October

Adaro Energy (ADRO IJ) – The Sustainable Leap

By Angus Mackintosh

  • Adaro Energy (ADRO IJ) has announced that it intends to spin off its thermal coal related assets under Adaro Andalan Indonesia, allowing it to focus purely on its sustainable businesses. 
  • The move will potentially allow it to realise a higher valuation for its pure coal assets while paving the way for access to sustainable financing for its renewable businesses. 
  • This will help the group accelerate the progress towards having more than 50% of its revenues from non-coal businesses by 2023. Adaro Energy (ADRO IJ) can trade at higher multiples.

EDG: First 2024 Drill Results: All Holes Intercept High-Grade

By Atrium Research

  • EDG announced assay results for its first six drill holes as part of its 10,000m 2024 drill program, it has completed 11 holes (3,500m) to date.
  • Today’s results confirm high-grade at-depth (~175m vertical) and extends the Imperial Zone ~100m to the northwest along strike (still open).
  • Assays for the next five drill holes are expected to be released in mid-October.

ADX Energy (ASX: ADX): Production Boost at Anshof in October

By Auctus Advisors

  • The ANS-2A sidetrack well has encountered a 6.5 m net vertical oil column in high quality Eocene-aged sandstone reservoir.
  • The reservoir quality encountered at ANS-2A is consistent with ANS-2 (porosity and permeability ~20% higher than at ANS-3).
  • The oil-water contact was encountered very close to the top of the water wet reservoir encountered at ANS-2.

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Sep 18
0

Daily Brief Consumer: Samvardhana Motherson International Ltd, Tube Investments of India , TSE Tokyo Price Index TOPIX, Henkel & KGaA, Signet Jewelers, Kroger Co, RH, CLS Holdings USA, Pvh Corp, Build A Bear Workshop and more

By | Consumer, Daily Briefs

In today’s briefing:

  • Samvardhana Motherson QIP – Well Flagged US$780m QIP in a Decent Name
  • Tube Investments of India (TIINDIA IN) | On-Ground Update on EV Foray
  • Can Investors Tolerate the Current Pace of Capital Profitability Improvement?
  • Liquid Universe of European Ordinary and Preferred Shares: September‘24 Report
  • Signet Jewelers: Striking A Balance Between Merchandise and Pricing! – Major Drivers
  • The Kroger Co.: An Insight Into Its Competitive Positioning
  • RH (Restoration Hardware): Brand Image Transcendence & Other Major Drivers
  • CLS Holdings USA, Inc. – CLSH: Strong Cost Controls Help Offset Revenue Decline in FY24
  • Pvh Corp – VNCE: 2Q Review: Driving Upside, Remaining Conservative; Reiterate Buy, $3 PT
  • BBW: Snapping the Store: Halloween Rules (Already!); Reiterate Buy, $41 PT

Samvardhana Motherson QIP – Well Flagged US$780m QIP in a Decent Name

By Clarence Chu

  • Samvardhana Motherson International Ltd (MOTHERSO IN) is looking to raise up to US$780m in its QIP. Together with the offering is a US$270m compulsory convertible debenture (CCD) offering.
  • The deal is very well flagged, having gone through rounds of board/shareholder approvals. The QIP has also been covered by domestic media reports.
  • In this note, we run the deal through our ECM framework and comment on deal dynamics.

Tube Investments of India (TIINDIA IN) | On-Ground Update on EV Foray

By Pranav Bhavsar

  • Tube Investments of India (TIINDIA IN) is focused on clean mobility solutions through its subsidiary, TI Clean Mobility Private Limited. 
  • The subsidiary’s Montra Electric 3-wheelers have quickly gained market share in southern India, targeting the last-mile mobility segment. 
  • TI’s management is keenly focused on the EV segment, with upcoming launches of e-rickshaws and a new Cargo Version poised to drive substantial growth in the near future.

Can Investors Tolerate the Current Pace of Capital Profitability Improvement?

By Aki Matsumoto

  • Few Japanese stocks that have advantages in profitability has led to the fact that investors who invest long-term in quality stocks have few Japanese stocks to choose from globally.
  • It’s the profit margin on sales that has had the greatest impact on changes in ROE. Companies must now get their core competencies once again to regain competitiveness and profitability.
  • Even if business selection and investment in promising businesses were to be implemented, it would be several years before they bear fruit. For many investors, this pace seems unacceptable.

Liquid Universe of European Ordinary and Preferred Shares: September‘24 Report

By Jesus Rodriguez Aguilar

  • Since mid-August, share-price spreads have generally widened across our European liquid universe of ordinary and preferred shares (13 have tightened, 4 widened, 2 remained at same level).
  • Recommended trades long preferred / short ordinary shares: Atlas Copco, Grifols SA, Media-for-Europe, Sixt.
  • Recommended trades long ordinary / short preferred shares: Carlsberg, Henkel, SSAB Svenska Stal.

Signet Jewelers: Striking A Balance Between Merchandise and Pricing! – Major Drivers

By Baptista Research

  • Signet Jewelers has reported its financial results for the second quarter of fiscal 2025, highlighting several critical strategic successes and challenges.
  • The company’s CEO, Gina Drosos, emphasized the continued momentum in same-store sales, which improved over 5 points from the first quarter, driven notably by robust Fashion sales.
  • The merchandise margin and the average transaction value (ATV) also saw growth, reflecting the positive reception of Signet’s merchandise strategies even amidst an intensely dynamic industry landscape.

The Kroger Co.: An Insight Into Its Competitive Positioning

By Baptista Research

  • The Kroger Co. showcased a mixed performance in the second quarter of 2024.
  • The company continues its progression towards a strategic operating model which balances customer-centricity with internal efficiencies, maintaining a competitive edge, particularly with its own brands offerings.
  • Revenue enhancements through enhanced digital sales channels and personalized promotions were notable.

RH (Restoration Hardware): Brand Image Transcendence & Other Major Drivers

By Baptista Research

  • RH, previously Restoration Hardware, exhibited positive stride in its financial and operational endeavors during the second quarter of fiscal 2024, as outlined in its latest earnings call.
  • The results were mostly favorable with noteworthy highlights such as a 7% increase in demand and 3.6% growth in revenues amounting to $830 million compared to the previous year.
  • This growth was propelled by strategic expansions and product transformations, notable investments during an economically challenging phase, and detailed preparation for projected housing market rebound.

CLS Holdings USA, Inc. – CLSH: Strong Cost Controls Help Offset Revenue Decline in FY24

By Water Tower Research

  • CLS Holdings is a vertically integrated cannabis company with core operations in Nevada.
  • The company owns and operates Oasis cannabis dispensary, one of the leading stores in Las Vegas.
  • CLS also has a state-of-the art extraction and manufacturing facility in Nevada and a suite of top-performing brands.

Pvh Corp – VNCE: 2Q Review: Driving Upside, Remaining Conservative; Reiterate Buy, $3 PT

By Small Cap Consumer Research

  • We are reiterating our Buy rating and $3 price target for VNCE, slightly reducing our FY24 top line, but increasing our bottom line projections after the company reported solid 2Q results, driven by stronger than expected wholesale revenue.
  • With the company now fully anniversarying the ABG Vince relationship, and the drive to materially reduce clearance and discount levels at their own stores completed, we believe 2HFY24 will begin to visibly demonstrate the power of the Vince brand to drive returns and position the company for further material top and bottom line expansion in FY25 from new store openings, further expansion in men’s, international growth and continued wholesale door and segment expansion which, when further fueled by ABG Vince category expansion, debt reduction and share repurchases, positions the company for material upside.
  • As such, we reiterate our Buy rating and $3 price target for VNCE.

BBW: Snapping the Store: Halloween Rules (Already!); Reiterate Buy, $41 PT

By Small Cap Consumer Research

  • We are reiterating our Buy rating, $41 price target and projections for Build-A-Bear Workshop after visiting stores in Long Island and Connecticut.
  • We believe the company’s decision to materially move up the Halloween offerings (from August 29th last year to August 6th in 2024) has driven customer excitement and material incremental revenue, as the company has added new characters, multiple drops and the ability to leverage the first Halloween for both Mini Beans and Skoosherz, with more exciting items (including the return of Nightmare before Xmas “furry friends”) on their way.
  • As such, we expect momentum to remain strong throughout the season and then almost immediately pivot into the Xmas holiday items.

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Sep 17
0

Daily Brief Thematic (Sector/Industry): Ohayo Japan | Stocks Higher on Rate Expectations and more

By | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

  • Ohayo Japan | Stocks Higher on Rate Expectations
  • Tech and AI Investing Trends: A Stock Picker’s Take
  • Hang Seng Bank – China Profit -70% YoY, Stage 3 Loans +84% YoY, HK CRE Impaired Loan +12.5x (Times)
  • Japan Morning Connection: IPhone 16 Pro Orders Miss Expectations
  • # 59 India Insight: Adani Green 6.6 GW RE, Tata Electronics Semiconductor, Reliance Expansion
  • Adjusting the Battery Blinkers
  • China Property: Silver Lining Through the Fog
  • Consumer Weekly. China Macro, US Auto Data, Visa, Coca-Cola, Wendy’s, Mondelez, Campari, Ally
  • TMT Daily:Apple, TikTok, PINS, Semis (TSM, Samsung, Intel), Software (EA, CRM, CRWD, WDAY, HUBS),EVs
  • Biopharma Week in Review – September 16, 2024

Ohayo Japan | Stocks Higher on Rate Expectations

By Mark Chadwick

  • U.S. stocks closed mixed on Monday as expectations for a 50-basis-point rate cut by the Federal Reserve grew
  • The dollar weakened as the yen hit a one-year high, with expectations growing for a significant Federal Reserve rate cut this week
  • GU, Uniqlo’s sister brand, has opened a New York headquarters to oversee its U.S. expansion, coinciding with the launch of its first permanent U.S. store.

Tech and AI Investing Trends: A Stock Picker’s Take

By The Bid

  • AI has become a dominant topic of discussion among industry leaders, signaling a significant shift in focus over the past year
  • Investment opportunities in AI extend beyond just a few mega cap stocks, with opportunities in chips, infrastructure, data and models, software applications, and services and solutions
  • Tony emphasizes the importance of building a new computing infrastructure for AI, which is transforming industries and creating new opportunities for tech investors.

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

Hang Seng Bank – China Profit -70% YoY, Stage 3 Loans +84% YoY, HK CRE Impaired Loan +12.5x (Times)

By Daniel Tabbush

  • Granular data at Hang Seng Bank suggests a greater deterioration in both HK and China than is readily visible in headline numbers
  • The bank’s China pre-tax profit is down 70% YoY in 1H24 and its total stage 3 loans are up 84% YoY in 1H24
  • The bank’s credit-impaired loans for Hong Kong CRE rose from HKD1,081m to HKD13,485m, from 2H23 to 1H24

Japan Morning Connection: IPhone 16 Pro Orders Miss Expectations

By Andrew Jackson

  • Positive sentiment from Intel’s deal with AWS and extra Govt. backing may outweigh plans to delay its EU fab capex for JP SPE suppliers.
  • Concerns iPhone 16 Pro preorders are below expectations to weigh on JP component suppliers, but can this be much of a surprise?
  • The JP Govt. agreeing for 7&I to be designated as a ‘core’ company is not a show-stopper and may compel Couche-Tard to up their game.

# 59 India Insight: Adani Green 6.6 GW RE, Tata Electronics Semiconductor, Reliance Expansion

By Sudarshan Bhandari

  • Adani Green and Adani Power secure 6.6 GW power supply deal, bolstering renewable and thermal capacity.
  • Tata Electronics plans two more semiconductor fabs in Gujarat, enhancing India’s chip manufacturing capabilities.
  • Reliance expands non-food retail space by 50%, focusing on boosting profitability and premium segments.

Adjusting the Battery Blinkers

By BMO Equity Research Metal Matters

  • Copper smelters are struggling for profitability but output is still rising, creating a relative concentrate imbalance in copper and zinc.
  • Zinc mine output has declined year on year, leading to a tightness in concentrate supply and challenges for smelters.
  • The electric vehicle market is facing challenges due to high costs and lack of policy support, especially in OECD markets, while China has a significant lead in the industry with lower costs and established supply chains.

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

China Property: Silver Lining Through the Fog

By Eric Chen

  • Getting China property right is essential for investors who follow China equities because most companies, from cyclical to consumer, can’t be insulated from its downturn.
  • China housing market is not collapsing as people feared; instead we see signs it is bottoming out with Xi’s pursuit of high-quality growth model starting paying off.
  • We expect the sector’s strain on Chinese economy will ease moving into 2025/26, setting a favorable backdrop for most China’s consumer-oriented stocks.

Consumer Weekly. China Macro, US Auto Data, Visa, Coca-Cola, Wendy’s, Mondelez, Campari, Ally

By Neil Campling

TMT Daily:Apple, TikTok, PINS, Semis (TSM, Samsung, Intel), Software (EA, CRM, CRWD, WDAY, HUBS),EVs

By Neil Campling

  • Apple iPhone 16 pre-orders weak and Questions on Apple Intelligence remain
  • Big software investor days. Expect AI to feature big on hype, but what to expect from TAM to ARR to products?
  • Semis: Samsung challenges, Intel relief but pressures remain, TSM momentum, this time with ByteDance 

Biopharma Week in Review – September 16, 2024

By Water Tower Research

  • We review last week’s biopharma news for meaningful clinical data, regulatory updates, research innovation, and M&A.
  • Last week started a busy season of medical and healthcare conferences, with obesity and cancer as major themes. SMMT led with Keytruda-beating (MRK) data in lung cancer, lifting TIL and BNTX with similar drugs.
  • NVO boosted amylin class of obesity drugs with positive early data, including ZLDPF, GPCR, and VKTX. 

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Sep 17
0

Daily Brief Credit: Morning Views Asia: Meituan and more

By | Credit, Daily Briefs

In today’s briefing:

  • Morning Views Asia: Meituan, Samvardhana Motherson International Ltd

Morning Views Asia: Meituan, Samvardhana Motherson International Ltd

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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Sep 17
0

Daily Brief ECM: Midea Group H Share Listing (300 HK): Trading Debut and more

By | Daily Briefs, ECM

In today’s briefing:

  • Midea Group H Share Listing (300 HK): Trading Debut
  • Auckland Airport Placement – Large NZ$1.4bn Raising, with ACC’s Overhang to Contend With
  • P N Gadgil Jewellers IPO Trading- Decent Anchor, Strong Insti Demand
  • Sung Woo IPO Preview
  • Sagility India Pre-IPO – Healthcare-Tech Exposure Although Alarming Concentration Risks to Watch For

Midea Group H Share Listing (300 HK): Trading Debut

By Arun George

  • Midea Group Co Ltd A (000333 CH) priced its H Share at HK$54.80 to raise HK$31,014 million (US$4.0 billion) in gross proceeds. The H Share will be listed tomorrow.
  • The H Share listing price implies an AH discount of 21.4% at the A Share price of RMB63.51. This compares to Haier Smart Home (6690 HK)‘s AH discount of 13.8%.
  • Futu grey market data shows that the H Shares closed 5.1% higher at HK$57.60. Our valuation analysis suggests that the H Share listing price is attractive.

Auckland Airport Placement – Large NZ$1.4bn Raising, with ACC’s Overhang to Contend With

By Clarence Chu

  • Auckland Intl Airport (AIA NZ) is looking to raise NZ$1.4bn (US$863m) in its primary follow-on offering. The offering includes a NZ$1.2bn underwritten placement, together with a NZ$200m non-underwritten retail offer.
  • The underwritten placement alone is a large one for the stock to digest at 168 days of three month ADV.
  • In this note, we run the deal through our ECM framework and comment on deal dynamics.

P N Gadgil Jewellers IPO Trading- Decent Anchor, Strong Insti Demand

By Akshat Shah

  • P N Gadgil Jewellers (1742652D IN) raised around US$130m in its India IPO. 
  • It is an Indian organized jewellery player with product offerings which include traditional as well as modern and functional jewellery designs, in gold, diamond, silver and platinum.
  • In our previous notes, we looked at the company’s past performance and valuation. In this note, we talk about trading dynamics.

Sung Woo IPO Preview

By Douglas Kim

  • Sung Woo is getting ready to complete its IPO in KOSDAQ in October 2024. Founded in 1992, Sung Woo produces components for cylindrical rechargeable battery, energy storage system, and automotive. 
  • The IPO price range is from 25,000 won to 29,000 won. According to the bankers’ valuation, the expected market cap is 376 billion won to 436 billion won. 
  • The book building for the institutional investors will be conducted from 10 to 16 October. The lead underwriter of this IPO is Korea Investment & Securities. 

Sagility India Pre-IPO – Healthcare-Tech Exposure Although Alarming Concentration Risks to Watch For

By Clarence Chu

  • Sagility India (2058883D IN) is looking to raise US$500m in its upcoming India IPO.
  • Sagility India is a pure-play healthcare focused solutions and services provider to Payers  and Providers.
  • In this note, we look at the firm’s past performance.

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Sep 17
0

Daily Brief Event-Driven: Auckland Airport (AIA NZ) Placement: Index Impact and more

By | Daily Briefs, Event-Driven

In today’s briefing:

  • Auckland Airport (AIA NZ) Placement: Index Impact
  • Seven & I Holdings (3382 JP): Core Designation Does Not Change Couche-Tard’s Calculus
  • Insights on the Odds of MBK Ramping up the Tender Price by 20%
  • Latin Resources (LRS AU)’s Scheme With Pilbara Minerals
  • Midea A/H Listing – Strong Demand for Quality Asset, Index Flows Could Help in the near Term
  • EQD | The Nikkei 225’s Trend Is Not Looking Good
  • Pacific Smiles (PSQ AU): Genesis’ Off-Market A$1.90/Share Offer

Auckland Airport (AIA NZ) Placement: Index Impact

By Brian Freitas

  • Auckland Intl Airport (AIA NZ) has announced an underwritten placement of NZ$1.2bn and a non-underwritten retail offer to raise NZ$200m.
  • The stock is trading near the low end of its range over the last few years and the 7% discount from the last close should attract investor interest.
  • We estimate passive trackers will need to buy around 13.5% of the placement shares coinciding with the settlement date on 20 September.

Seven & I Holdings (3382 JP): Core Designation Does Not Change Couche-Tard’s Calculus

By Arun George

  • On 13 September, the Ministry of Finance of Japan added 7&I to a list of “core” designated companies based on results of voluntary inquiries to all listed companies.
  • Several media reports suggest that the change in 7&I’s designation to core would complicate the proposed acquisition by Alimentation Couche-Tard (ATD CN). The core designation will not change Couche-Tard’s strategy.
  • The change to 7&I’s designation to core will paradoxically push Couche-Tard to firm up its revised offer. An undemanding valuation protects the downside of a no-deal situation.

Insights on the Odds of MBK Ramping up the Tender Price by 20%

By Sanghyun Park

  • MBK can cut their target volume to 12% and, with 2 trillion won, raise the tender price to ₩800,000, leaving them a 20% cushion.
  • MBK’s tight schedule aims to hit the 6.98% target while minimizing price volatility and market risk by shortening the offer window.
  • MBK plans to sweeten the deal by about 20%, similar to Hankook, aiming for a 6.98% target with a 20% price hike from the start.

Latin Resources (LRS AU)’s Scheme With Pilbara Minerals

By David Blennerhassett

  • Back on the 15th August, lithium play Latin Resources (LRS AU) entered into a Scheme with significantly larger peer, Pilbara Minerals (PLS AU). Timing appears fortuitous. 
  • PLS is offering 0.07 new PLS shares for each LRS share held.  LRS shareholders will own ~6.4% of the combined entity. LRS’ largest shareholder, José Luis Manzano (7.9%), is supportive. 
  • The scrip terms back out an implied price of A$0.20/share or a 67% premium to last close. This is done. And trading accordingly. Expected implementation late November, early December.

Midea A/H Listing – Strong Demand for Quality Asset, Index Flows Could Help in the near Term

By Sumeet Singh

  • Midea Group Co Ltd A (000333 CH) raised around US$4.6bn in its H-share listing (including over-allocation), after the deal was upsized.
  • Midea Group is one of the world’s largest home appliance manufacturing companies with a presence in over 200 countries. Its A-shares have been listed since 2013.
  • We have covered the deal background in our previous notes. In this note, we talk about the trading dynamics.

EQD | The Nikkei 225’s Trend Is Not Looking Good

By Nico Rosti

  • Although the Nikkei 225 INDEX was rallying strong early in the year, from mid-March the rally started to falter, and after a fake recovery into July, it fell again, lower.
  • Should the index go lower from last week’s Close at 36581.76, the next paragraphs of this insight will indicate what price levels are strong support to buy.
  • The only doubt we have is that the index’s overall trend does not look good. A correction to 33000 (or lower) is a possibility – a negative YEARLY performance.

Pacific Smiles (PSQ AU): Genesis’ Off-Market A$1.90/Share Offer

By David Blennerhassett

  • After Crescent Capital ‘s National Dental Care’ (NDC) A$2.05/share Offer, by way of Scheme, failed on the 9 August. it was just a question of when Genesis re-loaded its Offer.
  • Genesis has now announced a A$1.90/share off-market Offer ( its 29 July A$1.90/share approach was a Scheme), conditional on a 90% minimum acceptance. Pricing falls within the IE’ fair value range.
  • Pacific Smiles (PSQ AU)‘s board previously gave unanimous support for NDC’s prior A$1.90/share Offer. The question is whether the 90% hurdle is met. I think it will.

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Sep 17
0

Daily Brief Equity Bottom-Up: JM Financial: An Undervalued Gem Poised for Breakout Growth and more

By | Daily Briefs, Equity Bottom-Up

In today’s briefing:

  • JM Financial: An Undervalued Gem Poised for Breakout Growth
  • China Consumption Weekly (16 Sep 2024): Alibaba, Tencent, JD.com, Kuai, Hive Box
  • Technically Speaking, Breakouts and Breakdowns: HONG KONG (SEPTEMBER 13)
  • Geely (175 HK): Sales Volume Accelerated in August
  • Intel’s Make-or-Break Moment: How the U.S. Government is Fighting to Save America’s Chip Giant
  • Orient Overseas Intl (316 HK): Don’t Overlook Its Yield, Backed by Net Cash
  • Ingredion: Innovations Redefining the Taste and Texture of Modern Food
  • PC Monitor: Microsoft Copilot Wave 2 Unveils Major AI Boost; Reiterate Structural Long for PC Makers
  • Max Healthcare (MAXHEALTH IN): Continues to Strengthen Presence in North India
  • Jiangsu Hengrui Medicine (600276.CH) – Share Price Is at Risk of Correction

JM Financial: An Undervalued Gem Poised for Breakout Growth

By Sudarshan Bhandari

  • JM Financial has decadal experience of being the powerhouse of financial services giant. 
  • The company has been a bad capital allocator for the years and hence could not participate in the mega bull run.  
  • What makes it interesting is a company is changing its strategy of capital allocation while cherry on the cake is attractive valuations and promoter buying.

China Consumption Weekly (16 Sep 2024): Alibaba, Tencent, JD.com, Kuai, Hive Box

By Ming Lu

  • Alibaba’s Taobao and Tmall apps decide to accept WeChat Pay, the online payment way from Tencent.
  • JD announced that it will raise employee salaries up to 20 months within two years.
  • Hive Box, the market dominator of parcel locker in China, submitted its IPO proposal.

Technically Speaking, Breakouts and Breakdowns: HONG KONG (SEPTEMBER 13)

By David Mudd

  • Hong Kong Conglomerate Sector is showing renewed strength with Materials and Energy under pressure.  HK market 30 day volatility at 5 year low as market continues to de-risk.
  • Hengan International Group (1044 HK) chart broke down from its Descending Triangle pattern after reporting its 1H24 results. J&T Global Express (1519 HK) broke down from its double bottom pattern.
  • China Galaxy Securities (H) (6881 HK) price relative to the MSCI China index broke to a new high.  The company reported good results in a difficult environment for China brokers.

Geely (175 HK): Sales Volume Accelerated in August

By Ming Lu

  • The sales volume growth rate began to accelerate in August.
  • Geely’s revenue grew strongly by 39% YoY in 2Q24 and 47% YoY in 1H24.
  • The operating margin had improved YoY for the past one year and a half.

Intel’s Make-or-Break Moment: How the U.S. Government is Fighting to Save America’s Chip Giant

By Baptista Research

  • Intel Corporation, once the unchallenged leader in the semiconductor space, has recently found itself in a precarious position.
  • With its stock prices plummeting and revenues falling, Intel is struggling to regain its footing in a market dominated by foreign giants like TSMC and Samsung.
  • The U.S. government, through multiple initiatives and significant financial commitments, has stepped in to rescue the beleaguered company, seeing it as crucial to both national security and economic competitiveness.

Orient Overseas Intl (316 HK): Don’t Overlook Its Yield, Backed by Net Cash

By Osbert Tang, CFA

  • Orient Overseas International (316 HK) sits on decent yields of 12% for FY24 and 9.6% for FY25. Its net cash (66.2% of the share price) can support such dividends.
  • Despite the retreat from the recent peak, the spot freight rates are 9.7% and 145% higher than 1H24 and 2H23 respectively, pointing to better 2H24 earnings.
  • Operationally, it recorded the first YoY realised rate increase in 2Q24 after 6 quarters of consecutive decline. Its load factor also grew 2.3pp YoY in the quarter.

Ingredion: Innovations Redefining the Taste and Texture of Modern Food

By Pyari Menon

  • Innovation trends and patent filings within the food industry saw significant upswing over the year in the areas of natural ingredients and methods to manufacture vegan proteins.
  • Ingredion Ingredion Inc (INGR US) has a leadership position in  the fast growing Clean Label, Sugar Reduction and Plant-Based Protein Technologies
  • On a relative basis the stock despite better profitability metrics trades at a discount to the country-sector median and on an absolute basis at about 20% discount to FV.

PC Monitor: Microsoft Copilot Wave 2 Unveils Major AI Boost; Reiterate Structural Long for PC Makers

By Vincent Fernando, CFA

  • Microsoft today announced a major Copilot update, called “Wave 2”, introducing a new collaborative interface and enhanced Copilot capabilities across all major Office apps.
  • Copilot continues to gain momentum with large corporations, as Microsoft announced today that Vodafone has adopted it for 68,000 employees.
  • We remain Structurally Long PC Makers – We continue to believe Microsoft’s Copilot will drive PC upgrades as users recognize the productivity benefits of faster ‘AI PCs’. 

Max Healthcare (MAXHEALTH IN): Continues to Strengthen Presence in North India

By Tina Banerjee

  • Max Healthcare Institute (MAXHEALT IN) to acquire controlling stake in Jaypee Healthcare (JHL), which owns 3 hospitals in Uttar Pradesh, including the renowned 500-beds Jaypee Hospital, Noida.
  • JHL reported revenue of INR4.21B and EBITDA of INR70M in FY24. With an EV of INR16.6B, the deal values JHL at EV/EBITDA of 23.7x, which seems reasonable.
  • This acquisition will significantly enhance Max Healthcare’s network and strengthen its leadership position in NCR, a region which is home to around 46M people.

Jiangsu Hengrui Medicine (600276.CH) – Share Price Is at Risk of Correction

By Xinyao (Criss) Wang

  • On the surface, it seems that Hengrui’s performance growth in 24H1 is very high, but if excluding the upfront payment from Merck, the Company’s performance actually falls short of expectations.
  • Our forecast of revenue growth in 2024, 2025, 2026 (excluding Merck’s upfront payment) is 12% YoY, 8% YoY, 15% YoY, respectively. By 2026, Hengrui may still suffer from VBP.
  • Hengrui is overvalued and reasonable P/E is about 30 (or lower). We also don’t think Hengrui’s valuation should be higher than that of BeiGene. Current high valuation cannot be justified.

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Sep 17
0

Daily Brief Macro: Global FX: Implications from FOMC and other G10 central banks and more

By | Daily Briefs, Macro

In today’s briefing:

  • Global FX: Implications from FOMC and other G10 central banks
  • Global Commodities: Agricultural Markets Update – set for a seasonal recovery ahead
  • Portfolio Watch: Buy Bonds, Wear Diamonds (or Gold)?
  • Steno Signals #117 – 25bp equals mayhem, while 50bp equals panic?
  • Tactical Trading -Fed Meeting a Catalyst for Counter-Trend Moves
  • US Rig Count Rises for First Time in Five Weeks as Oil and Gas Rigs Increase
  • The Week That Was in ASEAN@Smartkarma – Alfamart’s Expansion, Indosat’s AI Push, and Saigon Cargo.
  • [US Nat Gas Options Weekly 2024/37] Henry Hub Inched Up on Production Cuts Amid Hurricane Francine
  • Antofagasta (ANTO LN): An Initiation on a Mid-Sized Copper Miner
  • [US Crude Oil Options Weekly 2024/37] WTI Crude Rises as Hurricane Impact Offsets Demand Concerns

Global FX: Implications from FOMC and other G10 central banks

By At Any Rate

  • Market pricing suggests nearly a 50% chance of a 50 basis point cut by the Fed, leading to uncertainty in the market.
  • The direction of the Fed’s policy is clear regardless of the cut amount, with aggressive easing likely to continue throughout the year.
  • Concerns about labor market weakness in Canada have prompted the Bank of Canada to shift its focus from inflation to potential weakening in economic activity.

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

Global Commodities: Agricultural Markets Update – set for a seasonal recovery ahead

By At Any Rate

  • Geopolitical risks are resurfacing in grain and oilseed markets
  • Weather-related risks are impacting agricultural markets, particularly in the US and South America
  • US grain export demand is strong, but dry conditions may lower yield potential and delay planting in South America, causing prices to rise

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

Portfolio Watch: Buy Bonds, Wear Diamonds (or Gold)?

By Andreas Steno

  • We’ve generally experienced a “softer” September than anticipated in terms of interest rates.
  • The typical September issuance seasonality takes a back seat to the upcoming first Fed cut in this cycle.
  • Nick Timiraos has hinted that some officials are seriously considering going big already next week, so we may be in for a ride.

Steno Signals #117 – 25bp equals mayhem, while 50bp equals panic?

By Andreas Steno

  • After a major dash for cash at the start of September, markets regained some optimism last week (much to my surprise, in all transparency).
  • A weak USD, soft USD rates, and soaring precious metals characterized the week, especially after Mr. Fed source #1, Nick Timiraos, wrote an article suggesting that a 50bp cut is in play.
  • USD weakness is something we often observe when the Fed begins cutting rates, as they are perceived to be much more reactive and aggressive than their peers.

Tactical Trading -Fed Meeting a Catalyst for Counter-Trend Moves

By Rikki Malik

  • The JPY is knocking on a key level vs the USD
  • Uncertainty over Fed interest rate decision could be a catalyst for a reversal
  • Buy JPY, Gold and Gold miners on any short-term correction

US Rig Count Rises for First Time in Five Weeks as Oil and Gas Rigs Increase

By Suhas Reddy

  • US oil and gas rig count rose by eight to 590 for the week ending 13/Sep, the first increase in five weeks and the largest weekly gain in a year.
  • US oil rig count increased by five to 488 after staying flat for three straight weeks. Gas rigs rose by three to 97, marking its first increase in four weeks.
  • For the week ending 13/Sep, US energy producers added three rigs each in Louisiana, Oklahoma, and Wyoming. Conversely, they cut two rigs each in California and Pennsylvania.

The Week That Was in ASEAN@Smartkarma – Alfamart’s Expansion, Indosat’s AI Push, and Saigon Cargo.

By Angus Mackintosh

[US Nat Gas Options Weekly 2024/37] Henry Hub Inched Up on Production Cuts Amid Hurricane Francine

By Suhas Reddy

  • US natural gas prices inched by 1.3% for the week ending 13/Sep, as the uptrend moderated following the impact of Hurricane Francine. Production cuts lifted prices last week.   
  • Henry Hub Put/Call volume ratio rose to 1.45 (13/Sep) from 1.19 the previous week as put volumes rose by 45.4% WoW, while call volumes grew by 19.2%.
  • Put volume and OI surged for contracts expiring on 25/Sep, Oct, and Nov. Call OI rose for expiries on Dec, Jan, Feb, and Mar.

Antofagasta (ANTO LN): An Initiation on a Mid-Sized Copper Miner

By Sameer Taneja

[US Crude Oil Options Weekly 2024/37] WTI Crude Rises as Hurricane Impact Offsets Demand Concerns

By Suhas Reddy

  • WTI futures gained 1.45% for the week ending 13/Sep, as Hurricane Francine offset demand concerns. The smaller-than-expected build in US crude inventories aided in the rebound.
  • WTI options Put/Call volume ratio increased to 1.30 (13/Sep) from 1.17 the week prior as call volume fell 36.6% WoW while put volume fell by 29.9%.
  • WTI OI PCR dipped to 0.76 for the week ending 13/Sep from 0.78 on 06/Sep. Call OI rose 7.6% WoW and put OI picked up by 4.7%.

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Sep 17
0

Daily Brief Australia: Latin Resources, Pacific Smiles and more

By | Australia, Daily Briefs

In today’s briefing:

  • Latin Resources (LRS AU)’s Scheme With Pilbara Minerals
  • Pacific Smiles (PSQ AU): Genesis’ Off-Market A$1.90/Share Offer

Latin Resources (LRS AU)’s Scheme With Pilbara Minerals

By David Blennerhassett

  • Back on the 15th August, lithium play Latin Resources (LRS AU) entered into a Scheme with significantly larger peer, Pilbara Minerals (PLS AU). Timing appears fortuitous. 
  • PLS is offering 0.07 new PLS shares for each LRS share held.  LRS shareholders will own ~6.4% of the combined entity. LRS’ largest shareholder, José Luis Manzano (7.9%), is supportive. 
  • The scrip terms back out an implied price of A$0.20/share or a 67% premium to last close. This is done. And trading accordingly. Expected implementation late November, early December.

Pacific Smiles (PSQ AU): Genesis’ Off-Market A$1.90/Share Offer

By David Blennerhassett

  • After Crescent Capital ‘s National Dental Care’ (NDC) A$2.05/share Offer, by way of Scheme, failed on the 9 August. it was just a question of when Genesis re-loaded its Offer.
  • Genesis has now announced a A$1.90/share off-market Offer ( its 29 July A$1.90/share approach was a Scheme), conditional on a 90% minimum acceptance. Pricing falls within the IE’ fair value range.
  • Pacific Smiles (PSQ AU)‘s board previously gave unanimous support for NDC’s prior A$1.90/share Offer. The question is whether the 90% hurdle is met. I think it will.

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Sep 17
0

Daily Brief South Korea: Korea Zinc, Tapex Co and more

By | Daily Briefs, South Korea

In today’s briefing:

  • Insights on the Odds of MBK Ramping up the Tender Price by 20%
  • Sung Woo IPO Preview

Insights on the Odds of MBK Ramping up the Tender Price by 20%

By Sanghyun Park

  • MBK can cut their target volume to 12% and, with 2 trillion won, raise the tender price to ₩800,000, leaving them a 20% cushion.
  • MBK’s tight schedule aims to hit the 6.98% target while minimizing price volatility and market risk by shortening the offer window.
  • MBK plans to sweeten the deal by about 20%, similar to Hankook, aiming for a 6.98% target with a 20% price hike from the start.

Sung Woo IPO Preview

By Douglas Kim

  • Sung Woo is getting ready to complete its IPO in KOSDAQ in October 2024. Founded in 1992, Sung Woo produces components for cylindrical rechargeable battery, energy storage system, and automotive. 
  • The IPO price range is from 25,000 won to 29,000 won. According to the bankers’ valuation, the expected market cap is 376 billion won to 436 billion won. 
  • The book building for the institutional investors will be conducted from 10 to 16 October. The lead underwriter of this IPO is Korea Investment & Securities. 

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