Industrials

• Back on the 17th Feb, PEC Ltd. (PEC SP), a plant and terminal engineering specialist, announced an Offer from Allied Energy Services, an engineering entity under the Liberty Group.
• Liberty offered S$0.84/share (not final), including a AS$0.20/share special dividend, a 12.8% premium to undisturbed; but more like a >35% premium. Irrevocables from the board of 63.38% had been secured.
• The Scheme Doc is now out, with an EGM on the 5th May, with payment on or before the 20th June. The IFA (Deloitte) says “fair & reasonable“.

• TRYT (9164 JP) was bought by EQT years ago and IPOed on TSE Growth in July 2023 at ¥1,200/share. The shares tanked on Day 1, almost reached ¥1,000 days later.
• Then they fell, and fell some more, reaching the ¥370s early in Q1, then again post Trump tariff announcement.  EQT still holds ~60%. Shares closed at ¥374 on 16 April.
• In February, there were noises about EQT putting the business up for sale, reportedly seeking an offer close to ¥1,200/share. Now there are noises of a Second Round.

• Grab hosted “GrabX” in Singapore and online to showcase a range of AI-driven product offerings that promise to be future growth drivers for the company.
• GrabFood For One and Shared Saver both have the potential to attract significant new business, but there was also the launch of AI-assistant Maya for Merchants to drive orders. 
• Additionally, Grab Unlimited continues to grow and be transformed into a fully-fledged loyalty program. Valuations are attractive, and Grab is set to make a net profit this year.

• Canvest Environmental Protection Group (1381 HK)’s IFA opines that Grandblue Environment Co A (600323 CH)’s HK$4.90 offer is fair and reasonable. The vote is on 12 May. 
• Key conditions include approval by at least 75% of independent shareholders (<10% of independent shareholders’ rejection). Shareholders with blocking stakes will be supportive.
• This is a done deal. At the last close and for a 10 June payment, the gross/annualised spread is 2.3%/18.3%. 

• Wintermar Offshore Marine booked a strong set of FY2024, confirming the ongoing recovery of the offshore oil & gas shipping segment and especially demand for higher-tier vessels.
• The company continues to build its fleet with several vessels coming on stream in FY2025 and FY2026, driven by optimism around ongoing investments in offshore oil & gas in Indonesia. 
• Wintermar Offshore Marine intends to sell its low-tier vessels and invest in more high-tier vessels this year, helping to drive future growth. 

• Last year was transformational for KITT, with its strategy shifting to commercializing its technology from its prior focus on research and development.
• The company expects 2025 “will continue to be a year of change.”
• On the earnings call and callback, our focus was on sizing the opportunity, the outlook for the year given long lead times and seasonality in the business, and the competitive landscape.

• FY12/24 sales rose 3.8% YoY to ¥293.31bn while operating profit dropped -22.3% to ¥9.49bn, surpassing previously revised down forecasts.
• Sales growth was boosted by the weak yen. However, the rise was limited by slowing auto production by Japanese, US and European carmakers in China and the impact from new model certification irregularities discovered at domestic automakers in Japan.
• OP was hit by rising costs, especially labor. However, the company is expecting a sharp rebound in OP growth in FY12/25 thanks to starting production of new products in Japan, a recovery in customers’ China output and starting to pass on rises in labor and energy costs, rather than only aluminum price fluctuations.

• CSI 300 represents the 300 largest stocks by market cap and liquidity from the Shanghai and Shenzhen Exchanges. CSI 500 is the next 500 names.
• In this insight, we take a look at the potential ADDs and DELs leading the race for the semiannual index rebal event in June 2025.
• Currently, we see 6 ADDs/DELs for the CSI 300 index and 50 ADDs/DELs for the CSI 500 index.

• Tsuyoshi Maruki’s Strategic Capital has gone after a number of cash-rich companies in the past. This is Year 5 going after Wakita & Co Ltd (8125 JP).
• Wakita is cash-rich, and has been for years, but it is also asset-rich. The former CEO, after he retired, decided he wanted to play in real estate.
• At the end of last month, Strategic Capital made proposals (English, Japanese) to Wakita. Again. Today, the company responded (only in Japanese). Time for more.

• Hyundai Elevator Co (017800 KS)’s share price has been moving higher on the back of higher dividends and a beneficiary of the potential economic co-operations between North and South Korea.
• Hyundai Elevator currently has a dividend yield of 8%, which is one of the highest dividend yields among Korean companies with more than 2 trillion won in market cap.
• There have been some initial discussions about increased economic co-operation between North and South Korea. Hyundai Elevator is a key beneficiary in such a scenario. 

• On the 22 July 2024, waste-to-energy play Canvest Environmental (1381 HK)announced a pre-conditional Offer from Grandblue Environment (600323 CH) at $4.90/share (best & final), by way of a Scheme.
• On the 17th March 2025, all pre-conditions were (finally) satisfied. 
• The Scheme Doc is now out, with a Court Meeting on the 12th May, with payment on or before the 10th June. The IFA (Somerley) says “fair & reasonable“.

• Tokyu may have just sold off its Tokyu Plaza building in Ginza but it is continuing to invest in retail.
• In particular, it will focus on newand upgraded retail facilities along the main Tokyu railway lines over the next decade,
• To make this happen and improve efficiency, it will merge its retail businesses into a more efficient, centralised core this summer.

Epwin Group’s FY24 results were robust and modestly ahead of market expectations, and FY25 trading appears to have begun with some optimistic trends. Epwin offers an attractive investment case with the potential for uplifts from additional self-funded M&A. Long-term, well-established growth trends imply that the company is well placed to leverage off increasing demand for its energy-efficient and low-maintenance building products. It trades on an FY25e P/E ratio of 8.7x, materially below the long-term average of 10.5x, and yields nearly 6%. The share buyback programme should continue to support the share price and could be extended again in due course.

• In this edition: • ASML Holding | reiterates FY25 outlook – order intake below long-term desired level • dsm-firmenich | deadline for non-binding offers for ANH this Thursday • Van Lanschot Kempen | Bank Delen further expands its presence in the Netherlands • Vopak | partnership with OQ to accelerate development of Duqm as integrated industrial hub • PostNL | main takeaways from yesterday’s AGM • TomTom | change in accounting strongly beneficiary for profitability – no impact on FCF

• CSI 300 represents the 300 largest stocks by market cap and liquidity from the Shanghai and Shenzhen Exchanges. CSI 500 is the next 500 names.
• In this insight, we take a look at the potential ADDs and DELs leading the race for the semiannual index rebal event in June 2025.
• Currently, we see 6 ADDs/DELs for the CSI 300 index and 50 ADDs/DELs for the CSI 500 index.

• Tsuyoshi Maruki’s Strategic Capital has gone after a number of cash-rich companies in the past. This is Year 5 going after Wakita & Co Ltd (8125 JP).
• Wakita is cash-rich, and has been for years, but it is also asset-rich. The former CEO, after he retired, decided he wanted to play in real estate.
• At the end of last month, Strategic Capital made proposals (English, Japanese) to Wakita. Again. Today, the company responded (only in Japanese). Time for more.

• Hyundai Elevator Co (017800 KS)’s share price has been moving higher on the back of higher dividends and a beneficiary of the potential economic co-operations between North and South Korea.
• Hyundai Elevator currently has a dividend yield of 8%, which is one of the highest dividend yields among Korean companies with more than 2 trillion won in market cap.
• There have been some initial discussions about increased economic co-operation between North and South Korea. Hyundai Elevator is a key beneficiary in such a scenario. 

• On the 22 July 2024, waste-to-energy play Canvest Environmental (1381 HK)announced a pre-conditional Offer from Grandblue Environment (600323 CH) at $4.90/share (best & final), by way of a Scheme.
• On the 17th March 2025, all pre-conditions were (finally) satisfied. 
• The Scheme Doc is now out, with a Court Meeting on the 12th May, with payment on or before the 10th June. The IFA (Somerley) says “fair & reasonable“.

• Tokyu may have just sold off its Tokyu Plaza building in Ginza but it is continuing to invest in retail.
• In particular, it will focus on newand upgraded retail facilities along the main Tokyu railway lines over the next decade,
• To make this happen and improve efficiency, it will merge its retail businesses into a more efficient, centralised core this summer.

Epwin Group’s FY24 results were robust and modestly ahead of market expectations, and FY25 trading appears to have begun with some optimistic trends. Epwin offers an attractive investment case with the potential for uplifts from additional self-funded M&A. Long-term, well-established growth trends imply that the company is well placed to leverage off increasing demand for its energy-efficient and low-maintenance building products. It trades on an FY25e P/E ratio of 8.7x, materially below the long-term average of 10.5x, and yields nearly 6%. The share buyback programme should continue to support the share price and could be extended again in due course.

• In this edition: • ASML Holding | reiterates FY25 outlook – order intake below long-term desired level • dsm-firmenich | deadline for non-binding offers for ANH this Thursday • Van Lanschot Kempen | Bank Delen further expands its presence in the Netherlands • Vopak | partnership with OQ to accelerate development of Duqm as integrated industrial hub • PostNL | main takeaways from yesterday’s AGM • TomTom | change in accounting strongly beneficiary for profitability – no impact on FCF

• Lotte Global Logistics (LGG KS) aims to raise around US$140m in its Korea IPO via selling a mix of primary and secondary shares.
• Lotte Global Logistics is a logistics and shipping company engaged in a comprehensive logistics service business including courier service, land transportation, 3PL, port loading and unloading, and international logistics.
• In our previous note, we looked at the firm’s past performance. In this note, we talk about the IPO valuations.

• A “Long SITC Intl (1308 HK), Short OOIL (316 HK)” pair trade should benefit from the more resilient intra-Asia trade and capture the tariff-induced challenges on Trans-Pacific trade. 
• OOIL derived 28.3% of its volume and 38.7% of its revenue from the Trans-Pacific route in 1Q25. Instead, SITC generated 100% of its revenue from the Asian market.
• While OOIL’s 0.7x P/B is cheaper than SITC’s 2.5x, its FY25 ROE of 10.6% is lower than SITC’s 34.6%. SITC’s dividend yield is also trending up, against OOIL’s down.

• Atlas’s offer for perennial takeover target De La Rue PLC (DLAR LN) is underpinned by a historic brand, strong order book, and post-sale cash buffer, with pension resolution and execution certainty.
• The £263m all-cash bid implies a 12.47x EV/EBITDA multiple, offering shareholders a 130p exit, cum-dividend, strong execution certainty, and over 40% committed shareholder support.
• With 91.7% market-implied completion probability and an annualized return of 4.5% at 128.5p, the deal presents an attractive, de-risked arbitrage opportunity with limited downside and credible upside closure.

• Lotte Global Logistics (LGG KS) aims to raise around US$140m in its Korea IPO via selling a mix of primary and secondary shares.
• Lotte Global Logistics is a logistics and shipping company engaged in a comprehensive logistics service business including courier service, land transportation, 3PL, port loading and unloading, and international logistics.
• In our previous note, we looked at the firm’s past performance. In this note, we talk about the IPO valuations.

• A “Long SITC Intl (1308 HK), Short OOIL (316 HK)” pair trade should benefit from the more resilient intra-Asia trade and capture the tariff-induced challenges on Trans-Pacific trade. 
• OOIL derived 28.3% of its volume and 38.7% of its revenue from the Trans-Pacific route in 1Q25. Instead, SITC generated 100% of its revenue from the Asian market.
• While OOIL’s 0.7x P/B is cheaper than SITC’s 2.5x, its FY25 ROE of 10.6% is lower than SITC’s 34.6%. SITC’s dividend yield is also trending up, against OOIL’s down.

• Atlas’s offer for perennial takeover target De La Rue PLC (DLAR LN) is underpinned by a historic brand, strong order book, and post-sale cash buffer, with pension resolution and execution certainty.
• The £263m all-cash bid implies a 12.47x EV/EBITDA multiple, offering shareholders a 130p exit, cum-dividend, strong execution certainty, and over 40% committed shareholder support.
• With 91.7% market-implied completion probability and an annualized return of 4.5% at 128.5p, the deal presents an attractive, de-risked arbitrage opportunity with limited downside and credible upside closure.

• Ashtead Group plc reported a solid set of third-quarter results marked by a stable performance amid varying market conditions.
• The company experienced a 5% year-on-year increase in both group and U.S. rental revenues, with total revenues remaining flat due to anticipated lower used equipment sales.
• The company achieved a record EBITDA of $3.9 billion and a profit before tax (PBT) of $1.7 billion.

• Ferguson plc’s latest financial results present a mixed picture, reflecting both strategic progress and ongoing challenges.
• The company reported a 3% increase in net sales to $6.9 billion for the second quarter, despite contending with 2% commodity-led deflation.
• Organic revenue contributed 2.1%, with an additional 1.2% growth from acquisitions.

• Ashtead Group plc reported a solid set of third-quarter results marked by a stable performance amid varying market conditions.
• The company experienced a 5% year-on-year increase in both group and U.S. rental revenues, with total revenues remaining flat due to anticipated lower used equipment sales.
• The company achieved a record EBITDA of $3.9 billion and a profit before tax (PBT) of $1.7 billion.

• Ferguson plc’s latest financial results present a mixed picture, reflecting both strategic progress and ongoing challenges.
• The company reported a 3% increase in net sales to $6.9 billion for the second quarter, despite contending with 2% commodity-led deflation.
• Organic revenue contributed 2.1%, with an additional 1.2% growth from acquisitions.

• Nippon Parking Development (2353 JP — US$477 million) — also known as “NPD” — is a Japanese lessor of parking spaces and an operator of ski resorts and theme parks.

• It’s the brainchild of lifelong entrepreneur Kazuhisa Tatsumi, who literally built the company in his garage in the early 1990s.

• In Japan, developers are generally required to build 1/3 parking space per 100 square meters of floor area for any large building. This is known as “legally mandated parking space”.

• Aequitas Research’s weekly update on the IPOs, placements, lockup expiry and other ECM linked events that were covered by the team over the past week.
• On the IPO front, we looked at the possible A/H premium for Jiangsu Hengrui Medicine (600276 CH), along with two live deals in Hong Kong . 
• On the placements front, only Suzuki Motor (7269 JP)‘s shareholders were brave enough to launch a placement in the turbulent markets. 

• Jiangsu Zenergy Battery Technologies (JSZENERGY CH) raised US$130m in its Hong Kong IPO.
• Zenergy is an EV and energy storage system battery manufacturer providing integrated battery solutions, encompassing battery cells, modules, packs and battery management systems dedicated to large-scale applications of electrochemical products.
• We have covered various aspects of the deal in our previous note. In this note, we will talk about the demand and trading dynamics.

• Nippon Parking Development (2353 JP — US$477 million) — also known as “NPD” — is a Japanese lessor of parking spaces and an operator of ski resorts and theme parks.

• It’s the brainchild of lifelong entrepreneur Kazuhisa Tatsumi, who literally built the company in his garage in the early 1990s.

• In Japan, developers are generally required to build 1/3 parking space per 100 square meters of floor area for any large building. This is known as “legally mandated parking space”.

• Aequitas Research’s weekly update on the IPOs, placements, lockup expiry and other ECM linked events that were covered by the team over the past week.
• On the IPO front, we looked at the possible A/H premium for Jiangsu Hengrui Medicine (600276 CH), along with two live deals in Hong Kong . 
• On the placements front, only Suzuki Motor (7269 JP)‘s shareholders were brave enough to launch a placement in the turbulent markets. 

• Jiangsu Zenergy Battery Technologies (JSZENERGY CH) raised US$130m in its Hong Kong IPO.
• Zenergy is an EV and energy storage system battery manufacturer providing integrated battery solutions, encompassing battery cells, modules, packs and battery management systems dedicated to large-scale applications of electrochemical products.
• We have covered various aspects of the deal in our previous note. In this note, we will talk about the demand and trading dynamics.

• Until quite recently, Nagoya had seven department stores but will soon have just four. 
• This follows Meitetsu’s decision to close its flagship store to clear the way for a major redevelopment of the station area.
• The new development will include retail and so bring some competition to Takashimaya, which now dominates department store retailing in the city, but not before 2033.

• We provide the short selling data analysis of the Korean stock market including the top 20 stocks in KOSPI with the highest short interest ratios in KOSPI and KOSDAQ, respectively. 
• There have been noticeable shorting on the Ecopro Group companies and other key names in the rechargeable battery sector including Posco Future M, L&F, and SK IE Technology. 
• Shorting has generally worked for KOSDAQ names with higher short interest ratios but not for KOSPI names in the past two weeks.