Australia

• There are 6 stocks in Australia that could be deleted from global passive portfolios later this month, though the probability of deletion varies across the stocks. 
• If deleted, passive trackers will need to sell between US$234m-330m in the stocks. Impact is high at between 7-23 days of ADV.
• The potential deletions have underperformed the S&P/ASX 200 (AS51 INDEX) over nearly every time period from 1 week to 3 months. Shorts have increased on all stocks recently.

• JB Hi-Fi Ltd (JBH AU) announced HY 2025 results this morning. Price increases 5.5% in early trading but gains were lost by noon.
• Sales Up 9.8% to A$ 5.67m; EPS up 8.0% to A$ 2.611; interim dividend up A$ 0.12 to A$ 1.70. Results are in-line/slight beat.
• Volatile trading can make for opportunities. Investors can speculate on a positive Post Announcement Earnings Drift (PEAD) or consider option strategies, as implied volatility remains elevated.

• Goldman Sachs has upgraded its iron ore price forecast, highlighting rising near-term demand from China’s steel sector during the spring construction season and weather-related disruptions at Australian ports.
• However, Goldman is bearish on iron ore for the second half (a consensus view), predicting a decline in China’s steel demand and the emergence of lower-cost supply.
• We continue to pound the table on Fenix Resources (FEX AU). Read “Fenix Resources (FEX AU) Q2 FY25 Update: Close to Tripling Production.

• One exceptionally crowded data room as PE outfit Brookfield Capital joins Bain Capital and CC Capital with a matching A$4.60/share NBIO, via a Scheme, for Insignia Financial (IFL AU).
• Brookfield’s Offer may include a scrip alternative in an unlisted bid vehicle, subject to caps.  As with Bain and CC Capital’s Offers, Brookfield’s Offer would ultimately require FIRB signing off.
• And similar to Bain and CC Capital, Brookfield has been afforded a limited period of access to certain non-public information on a non-exclusive basis.

• Back on the 28th January, Fortescue Metals (FMG AU) launched a A$1.05/share off-market Offer for Red Hawk Mining (RHK AU), increasing to A$1.20/share if securing 75% of shares out. 
• Red Hawks has announced Fortescue now has 78%, and has bumped terms to A$1.20/share. The Offer remains subject to “no prescribed occurrences“, which should be waived by the 17th Feb.
• The Offer remains open until the 3 March. Unless extended. Fortescue intends to delist Red Hawk. 

• Predictive Discovery receives a strategic investment of $69 million from Lundeen and Zejin, leading to a 13% increase in stock price
• The funds will be used for advancing the DFS at the Bankhan gold project in Guinea and other development activities
• Predictive’s Bankan project has a 5.4 million ounce resource and a 3 million ounce reserve, with an average production profile of 269,000 ounces per annum over 12 years at an AISC of $1,100 per ounce

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

• RaaS has published an update on superannuation and payroll compliance solutions business Wrkr (ASX:WRK) following its Q2 FY25 results in which it delivered a result in line with our expectations.
• Flat Q2 FY25 cash receipts and higher costs are in line with RaaS thinking and mask the progress being made in readiness for new client onboarding forecast (by RaaS) late in FY25.
• Our assumptions on key client onboarding remain unchanged, with REST (~1.4m members) forecast to begin H1 FY26, representing the first in a number of RaaS forecast step-change revenue events over coming years.

• On the 25th November, online trading player SelfWealth Ltd (SWF AU) entered into a SID with Bell Financial (BFG AU) at A$0.25/share after outbidding AxiCorp Financial Services.
• Now Singaporean-based wealth manager Svava has tabled a non-binding A$0.28/share Offer, in cash, by way of a Scheme. Svava also holds an effective blocking stake – 18.8% of shares out. 
• SelfWealth said Svava’s proposal “while indicative and non-binding, could be reasonably considered to become a superior proposal.” BFG needs to step up. 

• SGX IO Futures closed at $105.75/ton on Jan 31, gaining $0.90/ton over the week, with a high of $106.85/ton and a low of $103.50/ton.
• A golden cross formation on Jan 17 signaled a bullish trend, while RSI at 64.97 suggests a possible overbought condition.
• Prices remained in triple digits due to U.S. tariff uncertainties, reduced steel mill capacity, Lunar New Year closures, and weather-related supply disruptions in Australia’s Pilbara region.

• RaaS has published an update report on environmental services company Fluence Corporation (ASX:FLC) following its Q4 quarterly and financial and operating update and guidance for the FY25 year.
• The company met its previous guidance for revenue of US$51.5m and an EBITDA loss of US$4.0m, which was 9% better than RaaS’ forecast for a US$4.4m loss.
• FLC has provided a strong outlook for FY25 guiding to revenue of US$80-95m and EBITDA of US$3.0-5.0m.

• Fenix Resources (FEX AU) delivered impressive results for Q2 2025. Sales increased by 71% QoQ and 68% YoY, driven by the ramp-up of the Shine iron ore mine.
• The Beebyn-W11 mine, projected to ramp up production to 4 million tonnes from the current 2.5 million tonnes, is anticipated to receive final mining approval in the current quarter.
• Trading at 5.9x FY25e PE with 57 mn AUD in net cash, which accounts for 27% of its market capitalization, the stock is worth a look. 

• RaaS has published an update report on NT-focused gas explorer/producer Empire Energy Group (ASX:EEG) following its recent quarterly report and operational update.
• The company is poised to commence the last phases of activity on the path to project startup.
• Having successfully cased and cemented the Carpentaria-5H (C-5H) well above expectation on time and horizontal section, securing debt financing and NT environmental approvals, we await the commencement of testing post the wet season and the granting of the ‘Beneficial Use of Test Gas’ agreement, with the traditional owners, which formally approves commercial gas sales.

• In this insight, we take a look at the potential index changes for ASX 300, 200, 100, 50, and 20 in the run-up to the March 2025 index rebal event.
• We expect two changes for ASX 50, one change for ASX 100, and seven changes for ASX 200. Separately we see 8 ADDs and 6 DELs for ASX 300.
• The Sigma Healthcare – Chemist Warehouse merger will be completed soon and there will be major inflows for Sigma Healthcare due to float percentage/share count upgrades.

• I tally 58 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma.
• Ten new deals discussed this week! Australia’s Dropsuite, Red Hawk,; Singapore’s Japfa, SLB; Japan’s Global Food, Ascot Corp, Chuoh Pack Industry, Giga Prize, Sanyo Special Steel; and Dada Nexus.
• Key updates/news took place on: Sigma Healthcare (SIG AU), Shandong Hi-Speed New Energy (1250 HK), China National Building Material (3323 HK), Malaysia Airports (MAHB MK), and Sun Art (6808 HK).

• Global option markets present a diverse picture, offering a broad opportunity set.
• Several markets make for good hedging-candidates after a strong January and amid cheap options.
• Although several Indian indices show high implied volatility, contextual analysis indicates volatility may be fairly priced relative to their bear trends.

• Today, the S&P/ASX 200 (AS51 INDEX) reached a new all-time high while implied volatility is near record low levels. The combination makes for a good opportunity to hedge.
• Volatility assessment trough conventional volatility metrics and one new chart not seen anywhere else.
• An actionable example of a put option hedge is presented, striking a balance between protection and cost.

• Dropsuite (DSE AU), a backup, recovery and protection software company, has entered into a Scheme Implementation Deed with Texas-based IT automation outfit NinjaOne.
• NinjaOne is offering A$5.90/share, a 34.1% premium to last close. Apart from Dropsuite’s shareholder approval, the Offer requires FIRB signing off. The Offer has the unanimous backing of both boards. 
• The Offer also has the backing of Dropsuite’s largest shareholder, Topline Capital (31%). Board & management hold a further 9%.  Implementation is expected late May 2025. This is done. 

• RaaS has published an update report on online marketplace Airtasker (ASX:ART) following its Q2 FY25 results release which demonstrated continued momentum in revenue growth across all regions.
• All regions saw increased revenue (US marketplace revenue +278%, UK +95% and Australia +~13%) and all were at or above the Q1 FY25 growth rates, aided by increased marketing spend.
• After all cash outflows ART achieved positive cash flow of $0.54m for the quarter, resulting in increased cash at bank (to $18.3m at December 31).

• RaaS Research has published an update on edtech group ReadCloud (ASX:RCL) following the release of its Q1 results in which it reported a 26% increase in cash receipts to $2.4m.
• The result was in line with our forecasts from an operating cash flow and ending cash position.
• The company’s commentary was positive and gave us confident of our forecasts for the remainder of FY25 and into FY26.

• Sigma Healthcare (SIG AU) and Chemist Warehouse (CWG) shareholders have approved the merger with 99.86% and 100% of the votes cast in favour.
• The Second Court Hearing is on 3 February and the merger will be implemented on 12 February, which is when the passive buying could commence.
• Sigma Healthcare has continued to trade higher on a record margin and sales expansion for CWG and expected passive buying that could top A$3bn over the next few months.

• On 28 January, Dropsuite Ltd (DSE AU) entered a scheme implementation deed with NinjaOne at A$5.90 per share, a 34.1% premium to the undisturbed price of A$4.40 per share.
• The offer is conditional on shareholder and FIRB approval. The vote is low-risk as the largest shareholder has provided an irrevocable. 
• The offer is attractive and represents an all-time high. At the last close, for a 20 May payment, the gross/annualised spread was 3.0%/10.3%.

• Sigma Healthcare (SIG AU) announced that more than 99% of the shareholders cast vote in favor of the merger with CWG. The merger now remains subject to court approval.
• The court hearing is scheduled on February 3, 2025. If the Court approves the merger, it is expected that implementation of the merger scheme will occur on February 12, 2025.
• CWG continued healthy performance, with double-digit like-for-like retail network sales growth and 400bps EBIT margin expansion in H1FY25. We are bullish on the long-term growth prospect of the merged entity.

• Via an off-market offer, Fortescue Metals (FMG AU)is aiming to purchase all shares of iron-ore play Red Hawk Mining (RHK AU) at A$1.05/share, a 28% premium to last close.
• If Fortescue secures at least 75% of Red Hawk’s shares within seven days, the Offer Price increases to A$1.20/share, a 46% premium to last close
• Fortescue’s focus is on Red Hawk’s Blacksmith iron ore project, located ~30 kilometers west of Fortescue’s own Solomon project.

• RaaS has published an update on data analytics company Pureprofile (ASX:PPL) following its record Q2 and H1 results and guidance upgrade.
• Q2 revenue increased 30% to $15.3m, bringing H1 revenue to $29.2m, an increase of 22% on the previous corresponding period (pcp) and ahead of our forecast for $27.6m.
• Q2 EBITDA was a record $1.7m, up 79% on the pcp and bringing H1 EBITDA to $3.3m, a 38% increase on the pcp.

• RaaS conducted an interview with PPL CEO Martin Filz and COO/CFO Melinda Sheppard post the release of the company’s record Q2 and H1 results.
• This is a full transcript of the 14:36min interview.