Equity Bottom-Up

• An additional 24 Equipment are added to the restriction list (negative to AMAT, KLA, LAM). No explicit restrictions on ASML or Tokyo Electron, but that’s done indirectly.
• HBM Memory sales to China restricted (directly negative to Samsung), but restriction of DRAM Manufacturing Equipment sales is long-term positive to Micron, Samsung, SK Hynix. 
• 140 Chinese firms added to the Entity List, including all China’s Semi Production Equipment makers (Naura, AMEC, Piotech, SiCarrier). 

• A case against ASML being brought by the Hollywood Firefighters Pension Fund (HFPF) is now opening up into a class action lawsuit
• Claims that ASML withheld crucial information from investors in the Jan-Oct 2024 time period, e.g. impact of US sanctions, strength of the semi recovery, order backlog etc. 
• In reality, ASML warned in October 2023 that 2024 would be a zero growth year. Did the HFPF think they were kidding?

• Hong Kong market breadth stays strong despite market pullback in November.  Mainland investors continue to increase exposure to HK market through Southbound Connect platform.
• Baidu (9888 HK) , Baidu (BIDU US) , the global leader in Robotaxis, was granted a license to start operating its autonomous cars in Hong Kong.
• Vitasoy Intl Holdings (345 HK) shares surged on takeover rumours after Yeo Hiap Seng (YHS SP) increased its stake to more than 12% allowing them to call a Board meeting.

• Baidu’s third-quarter 2024 financial performance presents a complex picture, showcasing both opportunities and challenges that shape the company’s investment thesis.
• The company reported total revenues of RMB 33.6 billion, reflecting a 3% decline year-over-year.
• However, Baidu Core’s revenue remained stable at RMB 26.5 billion.

• Chailease offers an alternative view on China lending than the large mainstream banks there
• Data through 9M24 shows very high growth of its China impairment costs at +62% YoY
• Its lending in China is slowing sharply, often a reaction to worsening credit metrics

• Meituan reported C3Q24 revenue/non-IFRS operating profit 2%/12% above consensus, thanks to rising monetization and cost reduction. C4Q24 guidance, however, missed expectation due to low ASP mix and expansion;
• We see the following as positive catalysts: (1) consumption stimulus in 2025 that will likely include service coupons, (2) market share gains, (3) overseas expansion in Mid-East bearing quick fruits.
• We therefore opt to keep Meituan on our TOP BUY list and maintain TP at HK$165.

• Abercrombie & Fitch’s latest quarterly performance showed strong results, effectively capitalizing on consumer demand and strategic execution across multiple facets of their business.
• The company reported a record net sales figure of $1.2 billion for the third quarter, marking a 14% increase from the previous year, alongside a comparable sales rise of 16%.
• The operating income also witnessed a 30% growth year-over-year, driven by a 170 basis point improvement in operating margin to 14.8%.

• Urban Outfitters, Inc. reported a promising performance for Q3 of fiscal 2025, with total sales reaching a record $1.4 billion, a 6% rise compared to the previous year.
• This growth was primarily driven by strong performances from its Anthropologie and Free People brands, both of which posted mid-single-digit positive retail segment comps, which counterbalanced a high single-digit decline at Urban Outfitters.
• Nuuly, the company’s fashion rental business, also saw robust double-digit revenue growth, credited to a 51% rise in average active subscribers.

• Dell Technologies Inc. reported solid results for the fiscal year 2025 third quarter, demonstrating both strengths and challenges across its various segments.
• The company achieved a revenue of $24.4 billion, marking a 10% increase year-over-year, driven by strong growth in its Infrastructure Solutions Group (ISG) thanks to robust demand for AI servers and traditional servers.
• Diluted earnings per share (EPS) reached $2.15, reflecting a 14% rise, while cash flow from operations was $1.6 billion.

• NetApp’s recent earnings for the second quarter of fiscal year 2025 reflects a strong performance with both opportunities and challenges evident in the company’s results.
• Key aspects of the company’s current position and future outlook can be synthesized as follows: NetApp demonstrated significant growth in its all-flash storage segment, showing a 19% year-over-year increase, and enjoyed solid momentum in cloud storage services, which helped drive revenue beyond expectations.
• The reported revenues reached $1.66 billion, showing a 6% increase compared to the previous year.

• The recent pull-back in the share price of KHI provides a cheap entry point into the defense spending thematic
• KHI’s defense revenues are projected to soar by 40% to ¥406 billion in FY24, outpacing industry leader MHI’s 20% growth
• KHI and MJI to benefit from Japan’s defense spending doubling to 2% of GDP by 2027 and ¥43 trillion ($320 billion) earmarked over five years. 

• No stated reason for Mr. Gelsinger’s shock resignation as Intel’s CEO. 
• CFO and CCG leaders named as interim co-CEO’s with the latter also assuming a newly created role as CEO of Intel’s Products (CCG, DCAI & NEX)
• It’s the beginning of the end for Intel as we used to know it

• Starbucks’ CEO of China denied the rumor that Starbucks will sell its Chinese businesses.
• Chow Tai Fook closed 239 stores from March to September.
• SAIC and Volkswagen will extend their joint venture to 2040.

• China Mobile (941 HK) was a logical suitor for HKBN Ltd (1310 HK). A non-PRC (or government-affiliated) corporation taking over a media/broadband/telco in Hong Kong is probably a non-starter.
• China Mobile has a made a pre-conditional voluntary Offer at HK$5.23/share, a 40.97% premium to undisturbed. The price is final. 
• Pre-Cons are the usual suspects (NDRC, Mofcom & SASAC). The Offer itself conditional on a 50% acceptance hurdle, with 24.96% in the bag. The intention is to maintain HKBN’s listing. 

• MapmyIndia decided to hive off its B2C business to a promoter entity which will be funded and backed by the current listed entity.
• Hiving off loss-making business will lead to margin improvement for the listed entity but will increase the cash burn to fund loss-making business
• Departure of current CEO, taking funding from listed entity to fund this loss-making business where Promoter has the stake raises corporate governance issues.

• Our positive focus remains on three smaller cap Indian banks, namely Bandhan, Baroda and Union Bank of India (UBI); we stay negative on richly valued ICICI Bank and Kotak Mahindra
• Bandhan has its NPL challenges, but its pre-provision returns have improved and it is a value stand-out; Baroda remains our favourite and UBI has delivered better profitability and credit quality
• Kotak Mahindra is the peer group’s highest return bank post credit costs, but returns continue to erode; ICICI is on premium valuations and we expect credit costs to go higher

• Auto LED orders set to increase significantly for a year, with Edison predicting double growth by 2025.
• TSMC upgrades CoWoS technology to compete with 9x reticle sizes by 2027, showing continuous advancement in semiconductor manufacturing.
• MiTAC plans to double capital expenditures in 2025 to diversify production under the new administration of Trump 2.0.

• The HK market is moving, and the share prices of high-yield companies are increasing. Despite the average YTD returns of 38%, stocks are trading at 5-15% dividend yields.
• We update investors with results from Nameson Holdings (1982 HK) H1 FY25: 16-17% Dividend Yield Intact and Pacific Textiles (1382 HK), which guided down earnings due to interruptions in Vietnam.
• We also flag Yue Yuen Industrial Holdings (551 HK) results, buybacks, and some updates from our conference call with Nameson Holdings (1982 HK) management. 

• Hello, Welcome to the third edition of the Mikro Kap Wathclist, a series in which I go deeper into unique opportunities from my watchlist that, IMO, are worth monitoring closely.
• This way, you can act decisively when the moment comes, rather than spending weeks on initial research.
• These kinds of stocks would probably be a part of my portfolio if I were older, more diversified, or both.

• Telix Pharmaceuticals (TLX AU) initiated Phase 3 ZIRCON-CP trial of PET imaging candidate TLX250-CDx for clear cell renal cell carcinoma and dosed first patient in a cancer hospital in China.
• Telix is focused on expanding the near-term opportunity in precision medicine diagnostics with three new products planned for launch in 2025.
• CMS will unbundle and pay separately for specialized diagnostic radiopharmaceuticals for Medicare patients with per-day costs exceeding $630. The new payment decision is in favor of Telix.

• Meituan reported strong 3Q results last Friday which were largely expected by the market. Yet downbeat guidance seemed to have disappointed investors and dragged the stock during US trading session.
• We believe the stock’s significant re-rating since early 2024 has come to end as earnings growth starts normalizing after being boosted by less competition and narrowing losses from new initiatives.
• While the company has strengthened its moat and we expect steady growth ahead, we see near-term price volatility as markets digest the notable slowdown.

• Revenue grew by 22% YoY and operating margin improved 8 percentage points YoY in 3Q24.
• All Business lines grew strongly and all expense percentages of total revenue declined YoY in 3Q24.
• We believe the stock has an upside of 46% for the next twelve months.

• Hong Kong Alpha portfolio lost 2.9% in November, but has outperformed its benchmark by 4.9% since inception on October 1st.  It has outperformed HSI, HSCI and HSCEI by 9%.
• Hong Kong Alpha has generated idiosyncratic returns during the market correction.  The portfolio has no exposure to energy, healthcare and property sectors. 
• We exit 4 positions at the end of the month and add positions in software, tech components, travel and restaurant sectors.

• Samsung Semiconductor re-org, new reporting lines, top management promotions and demotions, but the same people. That’s going to solve problems? Qualcomm gives up on buying Intel – good idea. 
• Xiaomi to launch its smartphone chip, but what for? Intel launching a PC GPU again . Apple delays or abandons 2nm for M5 chip (too expensive). TSMC increasing CoWoS again. 
• China – US worsening relations, side effect is over buying, over stocking of semiconductors? is there a bunch of inventories in China that we can’t see?  

• Taiwan’s Largest Space Technologies Conference Is Happening This Week– Hon Hai Is Title Sponsor Showcasing Its Satellites; We Are Also Attending
• TSMC’s 2nm Breakthrough: Kaohsiung Fab Ahead of Schedule, Apple and AMD Poised as Early Adopters
• AI Driving the Emergence of a US$2bn Humanoid Robot Market by 2027E

• Cisco Systems, Inc. recently reported its first quarter results for fiscal year 2025, showcasing numerous strengths as well as areas to watch closely.
• The company’s revenue for the quarter reached $13.8 billion, sitting at the high end of their guidance range, though it marked a 6% decline year-over-year due to the previous year’s elevated backlog shipments.
• The strength across Cisco’s lines of business was evident in their recurring revenue streams, which now account for 57% of total revenue.

• NetEase’s recent quarterly earnings report demonstrates a mixed performance characterized by both promising growth areas and some challenges.
• The company’s overall financial health remains strong, supported by diversified business operations in gaming, education, music, and other innovative ventures.
• In the gaming segment, NetEase achieved solid results, with total online games net revenue reaching approximately RMB 20 billion, indicating substantial year-over-year and quarter-over-quarter growth in PC games.

• Applied Materials, Inc. recently reported its fourth quarter and fiscal year 2024 results, revealing several facets that contribute to its investment thesis.
• The company recorded record revenue and earnings, marking five consecutive years of growth.
• This performance underscores the competency of its strategy and execution, driven by the global team’s hard work.

• Kulicke and Soffa Industries reported its fiscal fourth quarter 2024 results, highlighting several key developments and challenges.
• The company’s revenue for the quarter was $181.3 million with a reported non-GAAP EPS of $0.34.
• The results were influenced by improvements in some end markets but were hindered by continued softness in others, particularly the LED segment.

• Bosideng International Holdings (3998 HK) has another solid 1H, with net profit surging 23% and DPS rose 20%. At 11.3x PER for FY25F, the valuation is not stretched.
• The gross margin for branded down apparel has hit the lowest 1H level since 1H FY22, however. Similarly, its OEM management gross margin has come down.
• Operating cash outflow rose to Rmb3.5bn, compared with Rmb585m a year ago, and inventory days leaped 29 days. Revenue and profit for ladieswear have plunged.   

• Astra Otoparts (AUTO IJ) looks set to see increasing contributions from its modern retail push, which will boost its trading business and should see margins improving over time.
• AUTO is pushing into both the EV component space and manufacturing public and residential EV charging equipment. It is also venturing into medical devices as local content becomes a requirement.
• AUTO has outperformed the auto market since the pandemic and looks set to continue to do so through new growth segments. Valuations attractive on 5.5x forward PER and 8% yield.

• Shopify Inc. has reported a strong performance for the third quarter of 2024, showcasing significant growth and expansion across several facets of its business.
• The company’s gross merchandise volume (GMV) grew 24% for the quarter, marking the fifth consecutive quarter of GMV growth over 20%.
• This growth was attributed to increased same-store sales among existing merchants, growth in new merchants, and international expansion, particularly in Europe.

• As Hong Kong market continues to consolidate, the consumer discretionary sector is leading in momentum and strength while the energy and materials sectors lag.
• Trip.com Group (9961 HK) , Trip.com (TCOM US) received BUY ratings after a strong 3Q24 announcement on revenue and earnings.  China’s tourist numbers are projected to reach Pre-COVID levels soon.
• Yum China Holdings (9987 HK) , Yum China Holdings (YUMC US) received BUY ratings after initial success from its small store/franchising strategy.  The company is actively returning capital to shareholders.

• Gross Margins Aggregate Data – Shows Taiwan Semiconductor Companies Under Pressure
• How TSMC and GlobalWafers show two very different margin environments; However everyone needs to manage rising energy costs into 2025E
• Aggregate Inventory Levels — Inventory Days Declining Trend is a Positive Sign

• Kanzhun, along with Kuaishou, Beike and PDD, are we call the “Macro Mauled Champions” (MMC). We suggest long term investors to accumulate;
• Weak industrial sector earnings in October bodes ill for manufacturing hiring into C4Q24 and we think may further extend to early 2025 recruiting season;
• We expect BZ to grow profit faster than revenues on cost savings, particularly on marketing and gain shares. We cut the TP from US$19 to US$17. 

• Bank Rakyat Indonesia should have a stronger finish to the year with stable credit costs and continuing growth in micro recoveries driving fee income growth, with NIMs remaining stable 
• Loan growth will increase in 4Q2024 but may see a slowdown in 2025 but the bank should see stable credit costs and a rebound in earnings with lower provisions. 
• Foreign ownership and vaulations are back to 2015 lows apart from the pandemic at 2.1x PBV is also a 10-year ex-pandemic low of 1.8x, and trades on 9.6x PER. 

• Memory Market Diverges: AI Demand Continues to Surges While Legacy Segments Struggle in November
• Diverging Demand Trends Highlight Market Decoupling — AI Driving HBM, Server DRAM, QLC NAND Demand
• Outlook for the Memory Market — Decoupling Trade: Long SK Hynix vs. Short Nanya Tech Trade

• TSMC: +20.4% Premium; ADR Premium is Approaching a Short Level
• UMC: +0.7% Premium; Short Interest Soars to New Two-Year Highs
• ASE: +4.2% Premium; ADR Headroom Falls to 100% Maxed Out

• Interparfums Inc.’s third quarter financial results for 2024 highlight several key aspects of their performance, including strengths and challenges in a fluctuating global market.
• On the positive side, the company reported its best third quarter in history, driven by robust sales across all major markets.
• North America, Western Europe, and Asia Pacific all saw double-digit sales growth, with North America up 12%, Western Europe 25%, and Asia Pacific 15%.

• Q2FY25 performance was mixed with good growth in AUM and volumes, however, loan losses were elevated. AUM growth came in at 29% YoY and 5.5%+ QoQ in Q2.
• Asset quality deteriorated led by retail and SME segments. GNPA worsened to 1.06% in Q2FY25 vs 0.86% QoQ. Credit cost has been around 2.1% vs 1.75%-1.85% guided.
• BAF successfully listed its housing finance subsidiary, BHFL, on Sep 16 2024. Its shareholding in BHFL is down to 88.75% from 100%.

• In this insight, we present our top investment ideas in the Apparel & Fashion retail sector, analyzing recent earnings results and key insights from company earnings calls.
• Names discussed include Page Industries (PAG IN), Vedant Fashions (MANYAVAR IN), Aditya Birla Fashion and Retail Ltd (ABFRL IN), Arvind Fashions (ARVINDFA IN) and Go Fashion India (GOCOLORS IN). 
• We have a bearish stance on all names except Page Industries (PAG IN).  

• Vodafone Idea (IDEA IN) gains a lifeline with the waiver of Rs. 24,700 crore bank guarantees for pre-2022 spectrum acquisitions.
• The waiver eases financial strain, boosts cash flow, and enables critical investments in 4G and 5G upgrades amidst competition from Reliance Industries (RIL IN)‘s Jio and Bharti Airtel (BHARTI IN).
• While a positive step, Vi’s recovery depends on fundraising, reducing debt, and regaining market share, making its turnaround uncertain but slightly more plausible.

• Clarity Pharmaceuticals Ltd (CU6 AU) announced that two participants have been dosed with 64Cu-SAR-bisPSMA and imaged days after the commencement of the Co-PSMA Investigator-Initiated Trial (IIT).
• SARTATE completes final assessment in Phase II diagnostic trial for neuroendocrine tumours. SAR-Bombesin began trial for castrate resistant prostate cancer.
• Clarity’s copper platform, strong prostate pipeline, and therapeutic and diagnostic efficacy data represent an attractive opportunity to grow a significant radiopharmaceutical franchise in oncology and other indications.

• BIDU reported C3Q24 top line, non-GAAP operating profit and GAAP net income in-line, 4.6% and 66% vs. our estimate and in-line, 8.7% and 46% vs. consensus.
• Ads revenue declined and C4Q24 guidance was below expectations. Margin improvement was mainly achieved through personnel cuts, which we think is not sustainable. AI didn’t contribute materially to revenues;
• We see no return to growth from any of the business lines. We keep our SELL rating and cut the TP from US$84 to US$78.

• BQE posted excellent Q3 financials that beat our expectations across the board as operations services continued its growth trajectory and the technical services and China JV segments reverted to historical levels.
• Proportional revenue came in at $10.2M (+28% YoY) vs. our estimate of $8.6M and Adj. EBITDA came in at $4.6M (+67% YoY) vs. our $2.7M.
• Management expects continued strong performance from the technical services segment through Q4/24 and Q1/25.

• In this insight, we examine the key challenges facing the sector and discuss potential paths forward for MFI-focused lenders. 
• Companies in this sector have seen sharp declines, with stocks down 45% from their 52-week highs and showing negative returns of -37% YTD.
• Considering the Industry data, it would be fair to conclude that the pain in the industry is likely to persist.  CREDAG, SPANDANA, AUBANK, and IIB are key names to watch.

• WA government announces $150 million package for lithium miners, including waiving government fees for two years
• Package also includes a $50 million loan facility for interest-free loans to sustain operations
• While the news did not significantly impact stock prices, it provides some relief and support for struggling lithium companies

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

• Investment thesis recommends shorting Shake Shack due to declining traffic, comp growth, and new unit productivity
• Stock price has surged despite challenges, trading at over 100x earnings
• Uncertain outlook with activist investor no longer involved and unique smashburger being commoditized, raising doubts about sustainability of growth.

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.

• The latest earnings result and call for NVIDIA Corporation (NVIDIA) indicate a period of remarkable growth and robust financial performance driven primarily by the adoption of its AI technologies and data center products.
• NVIDIA reported record revenue of $35.1 billion, which represents a 17% sequential increase and a striking 94% year-over-year growth, surpassing its revenue outlook of $32.5 billion.
• This growth spanned all market platforms, particularly fueled by the increasing demand for NVIDIA’s accelerated computing and AI solutions.

• Speculation of a Qualcomm-Intel deal diminishes, while Japan boosts semiconductor subsidies to benefit Rapidus, with further support anticipated.
• China’s semiconductor industry growth poses a threat to South Korean companies, prompting Samsung to weigh integration of ChatGPT, sparking concerns over its Google partnership.
• Hiwin bolsters its robotics presence by partnering with Boston Dynamics, expanding its influence in the industry, as India eyes doubling 5G subscriptions by 2030.

• 7&I traded at less than 5x reported EV/EBITDA consistently for roughly 4 years straight, and no one seemed to care or notice.
• Now that it trades close to 9x, there is an overflow of eager financiers and a mile-long line of analysts who will tell you that it is still undervalued.
• This is the stock market equivalent of duct tape and a banana.

• China announced game approval for the November batch. The number of games approved remained at a higher level than 2023.
• The pace of China game approval appears to have accelerated to the same level as pre-tightening.
• None of the companies that we are tracking got any approval for November batch.

• Phillips Carbon Black (PHCB IN) PCBL is the largest producer of Carbon Black in the country and seventh largest player in the world. 
• Transitioning to specialty carbon black, acquiring companies non-carbon linked companies and entering into JV for sunrise sectors EV battery chemical companies. 
• Guiding for 2400Cr Capex for 1Mn capacity of Carbon black capacity, 600Cr capex for Aquafarm chemicals and 500Cr for battery chemicals in the upcoming years for growth. 

• Bob Iger, CEO of Disney, discusses the legacy and importance of storytelling at Disney, emphasizing the need to balance heritage and innovation.
• He shares insights on leadership qualities, such as empathy, optimism, and the ability to act decisively, as well as the importance of staying curious and patient.
• Bob also touches on the impact of technology, AI, and the role of creativity in the future of storytelling, highlighting the need to maintain human creativity and caution with AI implementation.

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

• FY24 1H results and update on the ongoing long-term plan

• Headline NPL figures at KB Financial (105560 KS) are already of major concern rising by 49% in the past year to 3Q24
• Granular loan classification data is of even greater concern, where substandard loans are up from KRW1,153bn to KRW1,715bn over the same period
• This more benign bucket of NPLs well overshadows loss loans, can migration can mean a substantial rise in credit costs

• Brookfield Renewable Partners LP (Brookfield Renewables) delivered a robust performance in the third quarter of 2024, achieving record results in terms of funds from operations (FFO) and asset recycling, while also positioning itself strategically for future growth.
• The company’s execution of its business strategies and asset monetization initiatives have been central to its recent performance.
• Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology.

• William Companies $WMB believes more Republican control can resolve permitting issues, which would benefit the power industry and the energy infrastructure business.

• A favorable tax outcome will also be “a very huge positive to [its] guidance in the immediate term”. 

• Energy Transfer $ET said the Trump administration will bring “a breath of fresh air.” Nov 06: Q3’24

• Intel is now set to receive $7.86 billion in CHIPs Act funding, down from the $8.5 billion originally touted back in March 2024
• The funding comes with a raft of restrictions and caveats regarding what happens in the event of any changes in Intel’s organizational structure and/or ownership
• The US Department of Commerce also reserves the right to withhold funding and/or weigh in on decisions around outsourcing if Intel fails to meet key, critical milestones. Ouch!

• Halliburton’s Q3 revenue fell by 1.8% YoY and missed estimates by 2.2% dragged down by an 8.5% YoY fall in revenue from North America.
• The Completion and Production division’s revenue dropped 5.4% YoY and 3% QoQ, while the Drilling and Evaluation division posted a 3.5% YoY increase but declined 1.4% QoQ.
• Operating cash flow declined 23.5% QoQ, while free cash flow dropped 31.5%. Earnings were impacted by lost revenue from the cybersecurity incident and Gulf storms.

• Asian Paints (APNT IN) reported a 42.4% drop in Q2FY25 net profit and a 5.3% revenue decline.
• Intense competition, extended monsoons, weak urban demand, and margin pressures are impacting performance.
• Asian Paints’ resilience hinges on premiumization, sustainability, and industrial coatings to offset short-term challenges.

• Kioxia has been under-investing in Capex (27% of revenue versus competitors 37%) and R&D (5% versus 11%) because Free Cash Flow is low, too low to pay back debt. 
• The Memory cycle peaked in June-24 and NAND prices have been declining since. Memory stocks (Micron, Samsung, SK Hynix) peaked in June. 
• The valuations multiples that reconcile with a US$4.9bn market value are half or one-third that of competitors. A huge discount is applied, reflecting the financial and technological weakness of Kioxia. 

• Gravitation towards businesses with traditional competitive advantages and large reinvestment runways for future outperformance
• Genda’s growth primarily through mergers and acquisitions in the Japanese entertainment industry, taking advantage of the aging population of business owners
• CFO Taiju Watanabe’s background in Goldman Japan Investment Banking and transition to Jinda, highlighting the company’s potential for growth and profitability

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

• US Set to Unveil New Wave of Semiconductor Restrictions on China
• Hon Hai Subsidiary Says Progress for Nvidia GB200 Servers is Smooth, Mass Production in 2025E
• PC Monitor: Dell & HPQ Highlight Sharp Divide Between Corporate and Consumer PC Demand; Shares Slump 

• Siloam International Hospitals continues to establish a track record of improving returns through greater cost efficiencies and higher treatment intensity, focusing on the CONGO range of treatments.
• The company has seen strong growth in inpatient and outpatient admissions, with a growing portion coming through digital channels, and an increase in average revenue per operating bed.
• Siloam has maintained a beneficial payee mix and continues to expand its new hospitals in a measured way, helping to underpin future growth. Valuations remain attractive on 7.9x FY2025E EV/EBITDA.

• On Monday, I had the great pleasure to speak to Kaonavi’s (4435 JP – US$131 million) CFO, Kimitaka Hashimoto.
• He provided color on Kaonavi’s second-quarter earnings result, which were released on 13 November and led to a negative reaction from the market.
• In short, Kaonavi is a Japanese developer of talent management software. It helps companies manage their employees by solving staffing problems, designing their organizational structure, performance reviews, surveys, training, internal recruitment, etc.

• Ibotta operates a performance network connecting consumers with CPG companies and retailers for digital promotions and cashback rewards
• Despite a successful IPO, Ibotta has seen a significant derating due to failing to meet expectations
• Strong partnerships, growing user base, and unique business model suggest potential for a 56% upside towards a price target of $90 and eventually $120

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.

• China Dongxiang (3818 HK) turned around in 1H FY25 as it reported a net profit of Rmb137m, vs. losses of Rmb410m a year ago. Interim DPS increased 92.7% YoY.
• Investment gain is the key driver, reaching Rmb171m in the period, compared with losses of Rmb497m previously. Most investment categories contributed positively. 
• CDNX trades on a 76.9% discount to its SOTP value and a P/B of just 0.22x. Net cash amounted to Rmb3.2bn, or 58.3% more than its market capitalisation. 

• Sariguna Primatirta (CLEO IJ) continues to impress in terms of both growth and profitability for 9M2024 and looks well on track to exceed its guidance for 2024 substantially.
• The company has continued to expand its factory network outside Java this year, with three new factories due to be completed making it the largest water factory network in Indonesia.
• CLEO continue to launch innovative new variants with its most recent 1-litre variant aimed at increasing outdoor activities, and a new recycled bottle also being launched. Valuations attractive versus growth.  

• We are gradually building a high-conviction coverage of ideas for the mid and small-caps in the Philippines.
• We set criteria for high ROCE, reasonable growth (10-15% YoY), strong balance sheets, and reasonable capital allocation (dividend yields), all ingredients for being multi-baggers.
• We update results declared for Q3 by Shakey’s Pizza (PIZZA PM), Ginebra San Miguel (GSMI PM), The Keepers Holdings (KEEPR PM) and DigiPlus Interactive (PLUS PM) 

• Tier-2 commodity Memory is a lousy business, which requires high Capex and R&D, generates very low Free Cash Flows. DRAM is more sustainable than NAND as peak margins are higher. 
• Kioxia only makes NAND, has a high market share (16%) but is a Tier-2 supplier with a roadmap lagging SK Hynix by ~2 years, and a high exposure to Consumer. 
• The Memory cycle has recovered, probably close to peak earnings. That’s why stocks have been declining (Micron, Hynix).  Part 2 will cover financials (there’s a bad surprise) and valuations. 

• Xiaomi’s stock price has risen 62% since our buy rating after 2Q24 results.
• We believe vehicle production will bring Xiaomi a revenue of RMB90 billion maximum.
• The sum-of-the-parts valuation suggests significant downside for the next twelve months.

• PG Electroplast (PGEL IN) is India’s 2nd largest ODM player for washing machines. It also serve as ODM and OEM for leading brands in Room ACs, electronics, air coolers etc.
• Company is guiding for 76% of topline growth as well as 250Cr of PAT for FY25, out of which 103Cr is already delivered. Also company revised guidance upwards in Q2. 
• With 1500Cr of QIP in plan, company is looking for inorganic growth opportunities to make stronger growth going forward. 

• Hong Kong continued a correction in its Bull market which has lifted the HSCEI to be the best performing Asian index this year.  Southboune buying is strong.
• AAC Technologies Holdings (2018 HK) share price had a breakout relative to the MSCI AC Asia Index.  The company reported solid results benifitting from the smartphone and auto sectors.
• CGN Power (1816 HK) share price relative to MSCI China broke down.  The company reported a disappointing 3Q24 results even as power generation increased by 15% YoY for the period.

• TSMC: +19.2% Premium; Middle of Most Recent ADR Spread Trading Range
• UMC: -1.7% Discount; Local Shares’ Short Interest Continues to Rise
• ASE: +4.0% Premium; Local Shares’ Short Interest Has Finally Stopped Rising

• Exxon Mobil’s Q3 revenue fell by 0.8% YoY and net profit decreased by 5.1%. Revenue missed estimates by 4.2% but EPS exceeded expectations by 2.3%.
• Exxon Mobil’s Q3 upstream production rose by 24% YoY to 4.6 mboepd, driven by strong output in Guyana and the Permian basin and the acquisition of Pioneer.
• Exxon attributed its better-than-expected earnings in bottom-of-cycle conditions to structural cost savings, reduced expenses, high-return investments, and selective divestments.

• Lotte Chilsung Beverage’s land in Seochogu, Seoul is estimated to be worth more than 3x its market cap. 
• In the past several weeks, there have been increasing concerns about the overall debt pressures at the Lotte Group.
• Lotte Group may be considering on selling some of its assets including Lotte Rental, Lotte Capital, and Lotte Chilsung Beverage’s Seochogu land. 

• Although the reported FY24 net profit plunged 69.7% due to intangible impairments, China Education Group (839 HK)‘s adjusted net profit grew by 3.3% and adjusted EBITDA by 12.3%.
• Based on adjusted net profit, its payout ratio is flat at 40%, implying an 8% dividend yield. This suggests underlying operations are decent and demonstrate confidence in the outlook.
• Both tuition and enrollment are expected to sustain growth in FY25, meaning that a consensus forecast of 9% net profit is achievable. Its 4.5x PER does not appear stretched.

• Project quickly shut down by company, but still moving forward
• Concerns about Chinese buying in Australia
• Waiting on cost release for project, anticipating higher costs due to increase in uranium price

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

• Delta Thailand Still Grossly Overvalued Even After Recent Correction; Under Market Surveillance Until December 11th
• Delta Taiwan’s Market Cap Remains at Just 57% of Delta Thailand
• Further Valuation Correction Likely Between the Two Names; We Believe Delta Taiwan Should Outperform

• Deep Industries (DEEPI IN) targeting 800 Cr worth of revenue by FY26, with 35% CAGR in next 2 years.
• India is opening more oil & gas wells, needs services of company like Deep who can provide one stop shop for all Oil & Gas Needs.
• Key Triggers- Prabha Barge(60% Operating Margins) and Dolphin Offshore(for diversifying into offshore services) will further margin accretive.

• A European Court dismissed the injunction application filed by Insulet for overseas intellectual property rights infringement which would allow Eoflow to start selling its EoPatch products in Europe. 
• Eoflow is trying to complete a rights offering in December 2024. The expected rights offering price is 4,235 won (27% lower than current price). 
• Although results of the main lawsuit in the US remain undecided, with the UPC’s decision in favor of Eoflow, the legal sentiment on this case is in favor of Eoflow.

• Initiate a short position in MCHP Target Price Range: $45-50 Time Horizon: 6-12 months 
• Declining fundamentals: Q2 FY2025 revenue declined 48% YoY, with adjusted EPS falling 72% YoY. Valuation concerns: P/E of 36.8x vs. sector median of 22x, unsupported by current performance.  
• Geo-Political risk: 50% of sales from Asia, exposed to potential trade tensions. Operational challenges: Customer destocking and sluggish demand. ETF-Driven price support: Potential for sharp correction if sector rotation occurs. 

• Prada S.P.A. (1913 HK) (1913 HK —US$18 billion) is a strange beast.

• It’s an Italian fashion group listed in Hong Kong, of all places. Many European and American investors ignore the name, which has caused Prada to trade at a considerable discount to its peers.

• The first Prada shop was opened in 1913 by Mario Prada, a former leather goods salesman who imported English handbags and travel accessories and sold them to the Italian elite.

• Aspirasi Hidup Indonesia booked a solid set of 3Q2024 results with an upgrade to SSSG projects for FY2024 with the numbers and guidance for 20 new stores this year. 
• The company continued to expand stores more aggressively outside Java in 3Q2024 and into October and intends to increase store openings further in 2025 along with its rebranding exercise. 
• ACES will see inventories rise in 4Q2024 as it stocks up early for rebranding and upcoming festive periods. Valuations remain attractive with improving growth and productivity driven by regional expansion.

• HP undergoes leadership overhaul and revamps supply chain in preparation for Trump 2.0, while strict qualification measures impact 7nm technology development.
• TSMC’s AI chip expansion is overshadowed by the potential return of Trump, with global notebook shipments fluctuating in Q3/Q4 2024.
• DIGITIMES Research forecasts a steady revenue growth of over 10% CAGR for the global wafer foundry industry during the 2024-2029 period, while Apple India’s sales soar to US$8B driven by strong iPhone sales. Availability of Samsung’s HBM3E for Nvidia’s Blackwell remains uncertain.

• Post-Covid, Aeon Co Ltd (8267 JP) began to deliver real profit growth but 1H2024 showed it cannot rest on its laurels. 
• While it’ll be happy not to be worrying about a takeover bid like its rival, Seven & I, it still doesn’t have a profit machine similar to Seven Eleven Japan.
• Welcia helps and so does expanding e-commerce but there is still plenty of room for cutting overhead.

• In this Insight, we share our channel inputs that might be relevant for SRF Ltd (SRF IN), Navin Fluorine International (NFIL IN), and Gujarat Fluorochemicals (FLUOROCH IN).
• Weak demand and operational conditions in China have forced companies to focus on clearing inventory rather than maintaining prices, which has negatively impacted India’s export-oriented companies.
• Industry-Wide product cycles, especially in Specialty Chemicals, are shortening, which is a potential threat to leaders like SRF Ltd (SRF IN).

• Polymatech Electronics (POLM IN) revenues have skyrocketed by 27x in the last three years, but the balance sheet is filled with several red herrings. 
• Topline looks out of sync with production and have been largely aided by receivables. Being an R&D oriented company, the R&D expense only appeared in FY24, when sales were INR6bn
• Mis-Classification of cash flows, questionable RPT with promoters, dubious transition towards IND AS, absurd nature of some key expenses, also warrant attention

• Lagardere has two core businesses: publishing and travel retail.
• Publishing business has long-term cash flow potential and growth opportunities.
• Travel retail has captive audience but faces competition from airports for margins.

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

• Despite being a key beneficiary in travel and tourism in China, the rather muted growth in the first half does not bode well for Travelsky Technology Ltd H (696 HK) .
• YTD share price performance has reflected the above, but the deep discount valuation to Trip.com (TCOM US) might be temporary.
• In the near term, the company’s share price will not rebound as the company has less upside participation compared to Airlines and OTA. 

• Smartphone demand remains slow, that contributes to weak outlook for commodity DRAM.  Nvidia / Mediatek and Qualcomm AI PC chips should be launched mid-2025. 
• Nvidia allocation of TSMC CoWoS remains at 60% in 2025, capacity doubles, Data Center GPU revenue will double? TSMC 2nm-16A roadmap on track.  
• SK Hynix is now ahead of Samsung in HBM, DDR5, 3D NAND and SSD. Meanwhile, Samsung is buying back shares. 

• Takasago Thermal Engineering (1969 JP) is one of the top 10 players in Japan for energy efficiency players for industrial clients, especially semiconductors. 
• Japan Metropolitan Govt bought stake in Rapidus, signifying a potential long-term business potential for Takasago Thermal Engineering. 
• Valuation is no longer dirt cheap but still at a favorable level given its potential enlarged revenue growth. 

• Kuaishou reported C3Q24 revenue, IFRS operating profit,and IFRS net income in-line with our estimates and consensus.The only negative was that C4Q24 guidance for operating margin missed consensus and our estimate;
• Within mid-sized Internet platforms, Kuaishou lacks fresh secular driver, putting its stock under pressure. Advertising and GMV growth still outpace the industry and some peers. The stock is undervalued;
• We maintain our BUY rating and slightly revised down TP to HK$72 to make up for the higher-than-expected OPEX guidance.

• Haier plans to acquire all shares of Autohome and dismiss 30% of Autohome’s employees.
• In 3Q24, Xiaomi’s revenue grew by 30% YoY or 17% YoY without electric vehicle.
• In 3Q24, Tongcheng Travel’s revenue increased by 51% YoY with gross profit up by 29% YoY.

• The stock has risen 84% in one year, but we still believe there is an upside of 49%.
• We believe the operating margin will continue to improve significantly in 3Q24.
• We also believe the growth rates of all main businesses should be healthy in 3Q24.

• Nameson Holdings (1982 HK) results for H1 FY25 revenue/net profit showed a slight growth of 2.2%/3.1% YoY, with margin expansion being offset by lower other income. 
• The company declared a 9.8 cent interim dividend (current share price = 82 cents), maintaining a 75% payout ratio, which gives us confidence that a 16-17% yield can be maintained. 
• At 4.9x FY25 PE (see: Nameson Holdings (1982 HK): 17% Dividend Yield Can Be Sustained and Improved Long-Term ), this is a very steady yield play. 

• China State Construction Int’l (3311 HK)‘s backlog of HK$418.26bn is enough to cover 3x consensus forecast revenue of FY25, providing comfort for secured earnings outlook. 
• The focus on public housing and municipal projects limits its exposure to the real estate market. Its consecutive earnings growth in last five years demonstrated its resilience.
• With ROE of 15-16%, its P/B of 0.8x is cheap. The reduction in operating cash outflow supports higher payout ratio, and its dividend yield of 5.6-6.3% is healthy. 

• Shares of Jiangxi Rimag Group, a medical group with focus on medical imaging in China, rose 200%+ since IPO and massively outperformed Hang Seng Index.
• A Nanchang-based medical imaging center operator priced its IPO at HK$14.98/share and raised ~HK$183M in June. Cornerstone investors have agreed to acquire ~8M H shares.
• I expect key cornerstone investor may sell shares after 200%+ post-IPO gains as early lock-up period will end on December 6th, 2024.

• We met with UMP Healthcare (722 HK) in Hong Kong. We believe management’s cost control initiatives are bearing fruit and will see an inflection in earnings in FY25. 
• The weak consumption sentiment is setting a landscape for asset disposals, such as EC Healthcare (2138 HK) ‘s 436 mn HKD disposal of medical imaging to AIA. 
• We believe the company is a multi-bagger trading at 6.8x PE FY25e. It has ~80% of its market cap in cash (260+ mn HKD) and a ~10% dividend yield.