Financials

• Jio Financial Services (JIOFIN IN) has launched a robust digital ecosystem with its flagship JioFinance app, enhancing its tech-driven financial service offerings.
• The digital-first strategy minimizes legacy constraints, enabling personalized financial solutions that significantly boost efficiency and competitive advantage.
• This evolution redefines traditional banking, positioning JFSL as a versatile, technology-led powerhouse for sustainable growth in India’s financial sector.

• The Offering comes in lighter than expected. The buyback is smaller than expected. The resultant overhang is larger than expected. 
• The index flows around the delivery date are well-understood. They are what they are.
• Shareholder structure is such that this is not quite a new IPO but needs a lot of new shareholders. BUT… there is one redeeming feature one should not ignore.

• Japan Post Bank (7182 JP) has announced a secondary offering of up to 416.1 million shares (including overallotment), worth around US$4.2 billion.
• The offering includes a ToSTNeT-3 and an on-market buyback. Including the overallotment, Japan Post Holdings (6178 JP) will reduce its stake from 61.50% to 50.00% of voting rights. 
• Understanding the potential offer price requires looking at JPH’s past sales and recent large Japanese placements. The pricing date is likely 10 March.

• Japan Post Holdings (6178 JP) (JPH) aims to sell around US$4bn worth of Japan Post Bank (7182 JP) (JPB), trimming its stake to below 50%.
• JPH had last sold around US$9bn worth of JPB shares in Mar 2023. That deal had a similar structure and it didn’t end up performing well.
• In this note, we talk about the deal dynamics and run the deal through our ECM framework.

• Hotel Indigo Auckland is up for sale by McVay Real Estate and Whillans Realty Group, offering a prime investment opportunity.
• CDL Chairman accuses son of attempted coup, but Kwek remains CEO, ensuring stability within the company’s leadership.
• Mapletree makes a strategic move by buying a Hong Kong site for $473M at a significant discount, positioning itself for future growth.

• Growth in the other revenues segment drove total revenues of P$1.2 bn, increasing 2% YoY (better than our estimate).
• The other revenue row (land sales) reached P$424 million, representing 36% of total sales.
• On the other hand, the weak housing sales performance was due to a substantial 59% YoY contraction in total units, mainly explained by delays in the company’s work in progress and inventories (negatively impacted by weather, delay in permits, among others).

• SES AI marked an important milestone with its 4Q24 results, transitioning from pure-play R&D to active commercialization.
• The company booked $2 million in revenue at a 63% gross margin from previously announced deals with (1) EV OEMs for battery materials discovery and (2) cells for drones.
• SES AI also noted some of its 4Q cell revenue for drone applications was with SoftBank’s HAPS drone program, which suggests that it is building on the initial traction announced in the Data Blanket deal in this space. 

• Media reports indicate that Japan Post Holdings (6178 JP) could sell JPY 600bn (US$4.02bn) of Japan Post Bank (7182 JP) with the announcement coming as early as this week.
• The selldown is driven by Japan Post Holdings (6178 JP) needing to reduce its holding in Japan Post Bank (7182 JP) to 50% or lower by March 2026.
• Passive index trackers will buy around 11.4% of the offering at the time of settlement of the placement shares with the balance being bought in January 2026.

• On 22-February-2023 a Reuters suggested JPH (6178) had “started talks” to sell a big stake in JP Bank (7182). Five days later they announced a complicated deal discussed here.
• Today, an article suggests Japan Post Holdings (6178 JP) will sell ¥600bn in Japan Post Bank (7182 JP) to get ownership below 50% (as with JPI). A buyback might appear.
• JPB has issued a “there’s smoke” release. Like last time. Expected unwind of known overhang means minimal surprise here. The question is whether they could surprise (big buyback? capital plan?).

• Reportedly, China International Capital Corporation (3908 HK) and China Galaxy Securities (6881 HK), two of China’s leading state-backed brokerages, intend to merge via a share swap, forming China’s third-largest broker.
• This report/rumour arrives shortly after the successful merger of Guotai Junan Securities (2611 HK) (GJS) and Haitong Securities (6837 HK). 
• As with GJS/Haitong, expect a Merger by Absorption structure, and that Galaxy (or CICC?) issue new A and H shares to the target. I’d be picking up CICC shares here. 

• Reuters reports that Japan Post Holdings (6178 JP) (JPH) is planning to sell shares in Japan Post Bank (7182 JP) (JPB), which could total some JPY600 billion (US$4.0 billion).
• The potential offering would align with JPH’s stated goal of reducing its equity interest in JPB to 50% or less by FY 2025.
• The potential offering is relatively smaller than JPB’s 2023 offering. Compared to its peers, JPB’s valuation remains undemanding. 

• The odds of the cornerstone system getting the green light are significantly higher than they were two years ago.
• With bills typically taking a year to kick in, we need to stay on this—if all goes smoothly, cornerstone investors could hit Korean IPOs as early as next year.
• In the early stages, cornerstone allocations will be key to shaping our IPO trading playbook. Staying ahead of these shifts is crucial.

• The headline Indian mid cap indices are still expensive, despite a sharp decline since late September. However, when adjusted for growth, many fundamentally attractive mid-caps are cheap.
• We screen mid-caps with PEG<1.3x, consensus Buy recommendations and increasing consensus EPS estimates over the past six months. We choose well-covered stocks so that the consensus estimates are meaningful.
• Our basket of 20 contains six financial stocks, five materials, four industrials and three consumer discretionaries. Many pertain to the themes of renewable energy, data centers, healthcare, tourism and infrastructure.

• Costar Group (CSGP US) to acquire Matterport (MTTR US) for $1.6 billion, boosting its digital real estate capabilities.
• The regulatory hurdles and recent optimism on expected completion of the acquisition.
• The acquisition’s impact on major U.S. indices, expected mostly on an intra-quarter basis.

• After online trading player SelfWealth (SWF AU) entered into a SID with Bell Financial (BFG AU) on the 25th November, Singaporean-based wealth manager Svava gate-crashed the party earlier this month. 
• Svava tabled a non-binding A$0.28/share Offer, in cash, by way of a Scheme, versus Bell’s A$0.25/share. Svava also built an effective blocking stake – 18.83% of shares out.
• After Bell said it won’t make a counterproposal yesterday, SelfWealth has now entered into Scheme with Svava. Expect implementation in May. 

• Formation of a two-party coalition is seen as good news, as it eliminates the need to bring in additional parties with conflicting views
• Despite differences in specific tools, major parties align on broad objectives such as reducing energy prices and supporting key sectors
• The sense of responsibility to keep far-right parties out of power may drive centrist parties to work together effectively, potentially boosting business sentiment

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• Digital Realty is a global data center player across all major markets.  The DC demand will be back by secular trends including AI, Cloud and enterprise digitalization
• DLR’s focus on pricing, development pipeline and balance sheet enables it to achieve long-term sustainable growth, delivering a mid single digit FFO growth
• We also think DLR has maintained a strong balance sheet.  DLR is still in the process of de-leveraging with healthy credit metrics

• Deposit growth has been decent and exceeded loan growth, allowing HDFCB to bring down its credit-deposit ratio. Average deposits grew 15%+ YoY, while loans grew at 7%+ YoY in Q3FY25.
• Despite tough macro environment, HDFCB was able to gain market share in deposits. Despite headwinds from tight liquidity leading to competitive pricing, HDFCB was able to maintain its NIM.
• HDFCB is benefitting from its productivity and technology-led enhancements with costs growing at just 7% YoY. Despite weak macro-economic environment, HDFCB’s asset quality has remained pristine, barring seasonality in Agri-loans.

• Global capital flowing into Australian logistics market as it reaches turning point, attracting investments.
• Japan REIT makes deals in Tokyo, buying Tokyo Tower for $120M and selling office block for $62M.
• CapitaLand India Trust acquires Bengaluru offices for $170M after project funding, expanding its portfolio.

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.

• China Vanke
• Greentown China
• UPL Ltd

• PROFILE SOFTWARE S.A. (the group or the company) offers innovative, award-winning and flexible software solutions developed with high quality standards for the banking and investment management industry.
• Continuous R&D invest- ments and close contact with clients and associates around the world allows the company to keep innovating and meet the growing market needs.
• The company’s vision and goal is to provide innovative software solutions that enable finan- cial institutions and corporations across the world to deliver their full potential to their clients. 

• The push for MSCI DM inclusion drove Korea’s full short-selling resumption, clearing the KRX index rights issue, allowing MSCI to roll out derivatives, making full short selling the final step.
• With full short-selling back, traders are watching for large-scale quant funds to return, potentially boosting liquidity across the market alongside the ATS launch, after years of individual large-cap setups.
• The market is watching how full short-selling resumption narrows bid-ask spreads and impacts sector rotation, prompting traders to prepare setups for the broader market shift.

• European peace optimism driving continental asset prices, especially equities, while Chinese tech stocks sizzle hot in Asia
• US real yields impacting global risky asset markets, with Fed’s dovish reaction function leading to plummeting real yields
• Dollar likely to stay soggy in short term until potential FOMC hawkishness or tariff-related events reignite Trump trades and boost dollar bullishness, while yen strength may not be sustainable due to BOJ policy and yield spread factors.

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• Fed is unlikely to cut rates in the near term, with a majority of participants pointing to a still restrictive policy stance
• Front end treasury yields are anchored by Fed’s current stance, leading to low range volatility and ongoing support for the treasury market
• Discussion on balance sheet policy suggests QT may end earlier than expected, with reinvestment of MBS proceeds likely to be in T bills, potentially impacting term premium and yield curve dynamics

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

• Manappuram Finance is a leading Indian NBFC specializing in gold loans, offering financial services to lower socio-economic backgrounds with 5,286 branches across India.
• The RBI had barred the microfinance arm Aashirwad Micro Finance from sanctioning and disbursing loans due to non-compliance.  Company is planning for  IPO and intended to raise INR 1500 Crore.
• Manappuram is committed to growing its secured lending portfolio, including gold loans and other secured assets and anticipates overall growth of 15%-18% in the consolidated loan book.

• Keppel is an asset manager and operator with business in infrastructure, real estate and connectivity
• The company is undergoing transformation from an asset-heavy conglomerate to an asset light manager with strong recurring income
• We also like the strong capital management and its focus on total shareholder returns, valuation is not demanding

• After eight consecutive days of gains, the Kospi rally paused in the last two sessions, closing just above 350.
• The 350 area aligns with several key levels from the past three years.
• For those looking to hedge recent gains, we recommend two preferred hedge strategies.

• As expected, Horizon Robotics (9660 HK) replaces East Buy Holding (1797 HK) in the Hang Seng TECH Index (HSTECH INDEX) in March.
• In a surprise, Tencent Music Entertainment Group (1698 HK) will be added and ZhongAn Online P&C Insurance C (6060 HK) will be deleted.
• Horizon Robotics (9660 HK) is also an inclusion to the HSIII Index and HSCI Index and will be added to Southbound Stock Connect in May.

• In April 2024, we published a few notes on Japan REITs on the back of interest rate cut cycle and weaker Asian currencies
• Today, the macro environment has shifted, Japan has started a rate hike cycle. 
• Japan Hotel REITs will suffer due to negative impact on tourism and higher cap rate assumptions

• The 150 level on USD/JPY seems to be an area of heightened interest. We see potential for greater disparity of Nikkei returns below this level.
• Nikkei 1-month implied vol is at the 17th percentile; while not currently monetizing, caution is warranted on short vol positions as USD/JPY vol trends higher.
• Call volume dropped sharply vs total volume, with Puts outpacing Calls every day this week.

• Coinbase Global, Inc. reported substantial growth in its 2024 financial results, showing significant strategic progress and adaptability in the rapidly evolving cryptocurrency landscape.
• The company achieved over $6.6 billion in total revenue, more than doubling from the previous year, along with $3.3 billion in adjusted EBITDA.
• This affirmative financial trajectory marks two consecutive years of positive adjusted EBITDA, reinforcing its transition into a resilient company that performs in diverse market conditions.

• Nifty’s prolonged downtrend continues, making it the worst-performing market year-to-date.
• Low volatility dominated price action, with 1-week historic vol at just 3.54 ranking in the 4th percentile since 2021. Possible precursor to a break from here.
• Traders may consider letting deltas run, as daily delta hedging offers little benefit in this low vol environment.

• Siam Commercial Bank stands out from its peers for its focus on its new-generation businesses, which have started to bear fruit, whilst the bank provides a solid base.  
• The bank’s key focus is improving efficiency and asset quality, with the meaningful deployment of AI across the group, while targeting stable growth in its core banking business.
• Siam Commercial Bank also expects growing contributions from its 2nd generation businesses including Cardd X and Auto X. Valuations are attractive given the bank’s relatively high ROE and future prospects.

• Moody’s Corporation reported highly commendable financial results for the fourth quarter and the full-year 2024, highlighting robust revenue growth and profitability across its major business segments.
• Moody’s achieved total revenue growth of 20% for the year, surpassing $7 billion, significantly driven by the Moody’s Investors Service (MIS) and Moody’s Analytics (MA) divisions.
• The company managed to expand its adjusted operating margin by over 400 basis points, translating into a 26% increase in adjusted diluted earnings per share (EPS).

• Currency Exchange International (CURN) exits Canadian operations, incurring discontinuation costs, but expects $5-$6m profit tailwind by 2026.
• SPAR Group (SGRP) faces a third financing delay, suggesting Highwire Capital’s potential funding issues or hesitance.
• Embracer Group’s (EMBRAC-B:ST) valuation update post-Asmodee spin-off indicates potential 20%-80% upside if market recognizes Asmodee stake.

• I want to use my introduction to provide some comments on Howard Hughes (HHH).

• Bill Ackman’s Pershing Square Capital Management has disclosed a new offer related to Howard Hughes.

• The proposal is that Pershing Square Capital Management purchases 10 million newly issued shares at $90 each, totaling $900 million, which would increase Pershing Square’s stake from 37.6% to 48%.

• RaaS has published an update report on diversified financials company Bell Financial Group (ASX:BFG) following the release of its FY24 audited results which demonstrated H2 CY24 acceleration in NPAT relative to H1 in the key recurring revenue businesses of Technology & Platforms (+18% vs. +2%) and Products & Services (+9% vs. +3%) as scale benefits continue.
• The Retail & Institutional business benefited from improved ECM activity and equity volumes, with H1 FY24 NPAT growth ~290% and H2 FY24 +6% off a strong base.
• Products & Services delivered 10% NPAT growth in CY24, with H2 growth accelerating to 16% following 3% growth in H1 as scale benefits kicked in.

• We continue to be led down the garden path – no constituent changes for the Hang Seng Index (HSI INDEX) in March means we remain at 83 members.
• Despite having an opportunity to add stocks to the index without increasing turnover, the index committee have done nothing. Which begs the question – what exactly are they waiting for?
• Float and capping changes result in an estimated one-way turnover of 3.8% and the resulting round-trip trade is HK$16.7bn (US$2.15bn).

• We think Keppel DC REIT is an interesting play to look at for the AI revolution.  The markets are supported by strong fundamentals
• With a strong balance sheet and low leverage, the Company has ample headroom to do more M&As to drive DPU growth
• The stock has corrected post Deepseek incident.  We think valuation is attractive and presents an interesting opportunity.

• After an 18-month saga, the Burman family has taken control of REL, acquiring 25.16% equity and planning a INR 2,000 crore capital infusion.
• This takeover ends promoter-less governance, injecting fresh strategic capital to transform Religare into a competitive NBFC and drive long-term recovery.
• Investors should now view Religare as a turnaround story, with robust governance reforms, lower debt, and renewed focus on core financial services promising sustainable growth.

• Freshworks’ latest financial performance and strategic initiatives offer a complex picture with both strengths and potential challenges.
• Over the fourth quarter and full fiscal year 2024, the company delivered strong financial results, marking significant improvements in revenue and profit margins compared to prior estimates.
• Freshworks recorded a revenue increase of 22% year-over-year, reaching $194.6 million in Q4 alone, while reporting a notable non-GAAP operating margin of 21%.

• Brookfield has sold a Sydney logistics complex for $210M to Ontario Teachers’, KIC, and Gateway.
• CapitaLand Investment has closed a $130M private credit fund in Korea.
• Sun Hung Kai has bought a $77M residential plot, the cheapest land sale in 11 years in Hong Kong.

• Upstart Holdings Inc. recently reported a strong financial performance for the fourth quarter and full-year 2024, marking significant progress in various aspects of its operations.
• The company demonstrated a noteworthy increase in both origination volume and revenue, reflecting substantial growth compared to previous quarters and the prior year.
• Originations grew by 33% sequentially, and revenue increased by 35% in the same period.

• The CNMC’s provisional report requires BBVA to extend commitments to SMEs for three years instead of 18 months, a condition seen as manageable but opposed by Sabadell’s leadership.
• BBVA’s exchange offer for Sabadell values its shares at €2.37, below the market price of €2.504, implying a 5.3% shortfall, increasing pressure for BBVA to improve its bid.
• The Spanish government opposes the takeover, and political intervention, regulatory hurdles, and a history of failed hostile bank takeovers in Europe could significantly impact the deal’s success.

• APAC investors are welcoming rate cuts, with Hong Kong remaining a buyers’ market, according to Colliers.
• KKR & M&G invest $509M in an Aussie Warehouse Portfolio, while PGIM JV acquires Queensland sheds.
• Vanke partners with government insurers for a $220M housing JV, demonstrating state support in the real estate sector.

• S&P Global reported a robust 2024, evidenced by revenue growth and improved profitability metrics.
• The company reported a 15% increase in revenue, excluding the effect of divested Engineering Solutions in 2023.
• Subscription products grew by 7%.

• 2 Heads of Audit in 1 month with another replacement within 6 months
• Audit head in a bank is a highly sensitive post and the banking regulator recommends a minimum tenure of 3 years for the post
• Internal audit in Axis Bank has become a major concern which should worry investors

• “AI for Science’ is SES AI’s approach to using the latest cutting-edge GNNs and LLMs to augment battery materials discovery.
• “We can actually map all the physical and chemical properties of the small molecules. We did that, and then recently, we expanded to [electrolytes] for any lithium batteries….
• We’re expanding to lithium-ion for robots, drones, and energy storage. We found that this tool itself is actually really powerful. 

• After a minor “disaster” in a secondary placement in December, this morning industrial/infrastructure (including data centres) REIT/etc Goodman Group (GMG AU) announced results and an A$4bn primary offering.
• The large offering comes at a 6.9% discount, and For a combination of reasons, there is a LOT of buying to do with index tracking over the next short while. 
• But that too has complications. Some is immediate. Some a little delayed. A bunch may be supplied by short sellers. There is one easy trade. A few more complicated.

• Goodman Group (GMG AU) is looking to raise around US$2.5bn to partly fund its data centre expansion plans.
• Goodman’s shares have performed exceptionally well over the past year, driven by its pivot towards data centers.
• In this note, we will talk about the placement and run the deal through our ECM framework.

• The remaining third of Korea’s local securities lending market is moving to digital, potentially sparking a whole new trading landscape.
• Integrating EquiLend with local platforms boosts post-short-selling volume and shifts a large portion of manual trades into the digital space.
• This could spark new algo trading strategies, and with short selling resuming March 31, we’ll need to track how the flow evolves.

• Negara’s attractive valuations, its low PEG ratio and efficiency ratio should drive the share re-rating; pre- and post-provision were flat QoQ, but profitability ratios edged higher over the medium term
• We like Mandiri for its attractive PE multiples and its robust credit quality, despite the 4Q24 returns blip; Mandiri has the second-best efficiency ratio and with further scope for gains
• Rakyat’s high structural cost of risk remains a drag on its post-provision returns, with eroded further in 4Q24; although declining, returns are high but Rakyat valuations are not yet compelling

• Goodman Group went into a trading halt and then announced results and an underwritten equity placement of A$4bn (US$2.54bn) to pursue growth opportunities across logistics and data center operations.
• The stock has dropped since CIC’s stake sale in December but still continues to handily outperform peers.
• There will be some passive buying in the stock at the time of share settlement and more a few days later to mop up around 37% of the offering.

• EFCI Ltd (EFCIL IN) witnessed a robust Q3 & 9M FY25 growth with sequential revenue, EBITDA, and PAT increases; new SM REIT registration and strategic seat expansion initiatives bolster operations.
• Strong financial performance amid market challenges underscores resilience in flexible workspace and real estate sectors, positioning EFC India to capitalize on rising demand and government support.
• Company is planning to add 25000 seats annually, where expecting furniture vertical worth INR 150Crs and Design & Build worth INR 225-250Crs next year.

• ADIA and Hines sell Shanghai Tower for $1.5B to insurer-backed fund, showcasing large-scale real estate transactions.
• Keppel DC REIT sells German data centre at 39% loss from 2019 purchase price, indicating potential challenges in the real estate market.
• TPG offers $65M for Econ Healthcare, Singapore nursing home operator, amidst growing interest in healthcare industry investments.

• Arvind SmartSpaces (ARVSMART IN) posted 149% YoY revenue growth in Q3 FY25 and secured new projects worth RS. 3,850 crore, despite a 20% YoY decline in bookings due to approval delays.
• Improved profitability and strategic project wins underscore its resilience in a dynamic real estate market, driving long-term value despite operational hurdles.
• Company is planning to deploy Rs.500 to Rs. 600 crore in both vertical and horizontal projects over the next six months.

• Danish Compromise Uncertainty: If Banco BPM fails to secure Danish Compromise approval, its CET1 ratio could decline by 268bps, making it a riskier acquisition for UniCredit, potentially jeopardizing the deal.
• UniCredit’s Strategic Dilemma: UniCredit may renegotiate the exchange ratio, withdraw the bid, or pursue Commerzbank instead, as Banco BPM’s Anima acquisition increases capital consumption risks and complicates UniCredit’s strategic plans.
• Market Skepticism: As of February 18, 2025, Banco BPM’s shares trade at €9.04, while UniCredit’s offer values them at €8.47, leading to a +6.7% gross spread.

• Volta has delivered +21.2% 2024 total NAV return, outperforming i) B-rated CLO tranches (+19.2%), ii) US high yield (+8.2%), iii) Euro high yield (+8.6%), and iv) global loans (+7.3%).
• Its performance reflects positive markets and the incremental value added by the manager through its asset selection and portfolio management.
• Looking into 2025, we expect another strong year from CLOs: more market growth (partially driven by loans issued to fund greater PE activity), and stable, if not falling, defaults offsetting some spread tightening and fewer pull to par benefits from loans restructuring.

• Clip Money is a rapidly growing NCR-backed start-up based in Ottawa, Canada, and operating in Canada and the US.
• It is helping physical stores and businesses quickly, safely, and less expensively deposit cash into their bank accounts, as well as replenishing notes and coins for store operations.
• The company uses its proprietary software platform to facilitate cash management, and its network is made up of a network of DropBoxes, NCR ATMs located in retail outlets and a second half roll out at Green Dot locations.