Daily Briefs

At the October rebalance, Free Float Weight (FFW) will be reduced on 284 stocks and increased on 458 stocks. 43 stocks will be removed from Phased Weight Reduction.
Estimated one-way turnover is 1.77% resulting in a one-way trade of ¥1.45tn. 364 stocks have over 4 days ADV to trade, 97 stocks have over 8 days ADV to trade.
Over the last 6 months, the stocks with inflows (>US$25m) have outperformed the stocks with outflows (>US$25m) with most of the outperformance coming in the last three months.

Kenedix Merger: Significant Passive Inflows Expected in Three Weeks

The three-way merger of Kenedix Office Investment Co (8972 JP), Kenedix Residential Investment (3278 JP) and Kenedix Retail REIT (3453 JP) will be implemented in less than 3 weeks.
With the market cap of the merged entity at US$4.85bn, there will be upgrades to indices with larger tracking assets and significant passive buying at the time of merger implementation.
All three stocks have outperformed their peers since merger announcement and over the last month and at least part of the upcoming passive flow is baked into the price.

Rakuten Bank IPO Lock-Up – Parent and Company Will Come Out of Lockup

By Sumeet Singh

Rakuten Bank (5838 JP) (RB), the online banking arm of Rakuten Group (4755 JP), raised around US$630m in its Japan IPO. Its IPO linked lockup will expire soon.
RB is the largest internet bank in Japan, by number of accounts. As of Jun 23, it had 14.0m deposit accounts with a total deposit base of JPY9.4tn.
In this note, we will talk about the lock-up dynamics and updates since our last note.

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Oct 10

Daily Brief Quantitative Analysis: TWSE Foreign Holding Weekly (Oct 6th): Fubon Financial and more

By Smartkarma Daily Briefs | Daily Briefs, Quantitative Analysis

In today’s briefing:

TWSE Foreign Holding Weekly (Oct 6th): Fubon Financial, TSMC

TWSE Foreign Holding Weekly (Oct 6th): Fubon Financial, TSMC

By Ke Yan, CFA, FRM

We analyzed the changes in foreign holdings of TWSE Stocks as of Oct 6th which has an aggregated holding worth USD621.8bn.
We tabulate league table for top changes by value for 1 week, one 4 weeks, 1 year and top stocks held by foreign instutions by dollar value.
We estimate that foreign flows to be outflows of USD449mln. We highlight foreign changes in Fubon Financial, TSMC.

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Oct 10

Daily Brief ESG: Inretail RE – ESG Report – Lucror Analytics and more

By Smartkarma Daily Briefs | Daily Briefs, ESG

In today’s briefing:

Inretail RE – ESG Report – Lucror Analytics
Inretail Consumer – ESG Report – Lucror Analytics
Manager’s Real Intent to Prevent Further Increase in Ratio of Independent Directors Is Revealed

Inretail RE – ESG Report – Lucror Analytics

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
We assess InRetail RE’s ESG as “Adequate”, in line with its Environmental, Social and Governance scores. Controversies are “Immaterial” and Disclosure is “Adequate”.
We have based our assessment on parent InRetail Peru Corp’s sustainability reports, which disclose ESG-related information on a consolidated basis, with some details provided for its (bond-issuing) credit pools InRetail RE and InRetail Consumer.

Inretail Consumer – ESG Report – Lucror Analytics

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
We view InRetail Consumer’s ESG as “Adequate”, in line with its Environmental, Social and Governance scores. Controversies are “Immaterial” and Disclosure is “Adequate”.
Our assessments are based on the sustainability report by parent InRetail Peru Corp, which discloses ESG-related information on a consolidated basis, with some details for its bond-issuing credit pools InRetail Consumer and InRetail RE.

Manager’s Real Intent to Prevent Further Increase in Ratio of Independent Directors Is Revealed

By Aki Matsumoto

The Kankeiren intends to prevent further increases in the ratio of independent directors because of the small number of candidates for outside directors.
One reason why the substance of the Corporate Governance Code has not improved is that independent directors are a minority on the board.
The company is also responsible for not developing female internal executive director candidates, relying on outside directors for female directors, and not appointing foreign talent to the board.

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Oct 10

Daily Brief TMT/Internet: SK Telecom, CELSYS, China Unicom Hong Kong, Tianju Dihe Technology, Money Forward , Wuhan Jingce Electronic Group, Micron Technology, Marizyme, Paychex Inc, Factset Research Systems Inc and more

By Smartkarma Daily Briefs | Daily Briefs, TMT/Internet

In today’s briefing:

Korea – Positioning in Stocks That Could Have Global Passive Flows
TOPIX Inclusions: Who Is Ready (Oct 2023)
HSCEI Index Rebalance Preview: One Change; Capping Impact Increases
Tianju Dihe Technology IPO Preview: Data Drives The Future
Money Forward (3994) | Show Me the Money
ChiNext/ChiNext50 Index Rebalance Preview: Sector Rotation Continues
Micron Technology Inc.: Unpacking the Strategies Behind Their Recent Financial Performance! – Major Drivers
Marizyme, Inc. – DuraGraft Approved for US Markets
Paychex Inc.: Decoding Their Investments In AI & What It Means for the Future! – Major Drivers
FactSet Research Systems Inc.: Are The Latest AI Investments Expected To Catalyze Revenue Growth? – Major Drivers

Korea – Positioning in Stocks That Could Have Global Passive Flows

Posco DX (022100), Kum Yang (001570), SK Telecom (017670), Lotte Energy Materials (020150), Kakao Games (293490), Pan Ocean (028670), BGF retail (282330), Netmarble (251270) have been on investors/traders radars recently.
There could be liquidity events in some of the stocks next month as passive index trackers look to buy/sell the stocks.
Foreign investors have sold Lotte Energy Materials (020150 KS), Kakao Games (293490 KS), Pan Ocean (028670 KS) and Netmarble (251270 KS) while buying BGF retail (282330 KS).

TOPIX Inclusions: Who Is Ready (Oct 2023)

By Janaghan Jeyakumar, CFA

Quiddity’s “Who is Ready” series of insights aims to objectively identify names listed on the Tokyo Stock Exchange that are potential additions to the TOPIX Index in future.
Since my last insight, CellSource (4880 JP) and Kasumigaseki Capital (3498 JP) have confirmed they will move to TSE Prime which means they will be included in TOPIX at end-November.
FP Partner (7388 JP) and I-NE (4933 JP) will get included in TOPIX at the end of October.

HSCEI Index Rebalance Preview: One Change; Capping Impact Increases

Zhongsheng Group (881 HK) is in deletion zone and could be deleted. China Unicom Hong Kong (762 HK) could be added to the index as the highest ranked non-index constituent.
Estimated one-way turnover at the rebalance is 2.14% resulting in a one-way trade of HK$1.38bn. Meituan (3690 HK), Alibaba Group (9988 HK) and Tencent (700 HK) will be capped higher.
China Unicom Hong Kong (762 HK) is supported on its 50/100 day moving averages and could move higher. Zhongsheng Group (881 HK) has been trading below its moving averages.

Tianju Dihe Technology IPO Preview: Data Drives The Future

By Andrei Zakharov

Tianju Dihe Technology, more commonly known as Juhe Data, filed to go public in Hong Kong. The company provides standard API services through its APIHub marketplace in China.
Tianju Dihe Technology plans to trade on the HKSE, and CITIC Securities is leading the IPO. The company was backed by JD Technology, a fintech unit of JD.com.
With a market leadership position and a mission to empower the digital economy with data technologies, I have no doubt that Tianju Dihe Technology will have a successful IPO.

Money Forward (3994) | Show Me the Money

By Mark Chadwick

Money Forward’s share price dipped 20% post-Q2 results, but strong operational performance and upward sales revisions make it appealing.
We expect 42% YoY sales growth in Q3 and believe long-term growth prospects remain exceptional against the market size.
Management to deliver profitability next FY, meeting investor demands to “show me the money” – we remain bullish

ChiNext/ChiNext50 Index Rebalance Preview: Sector Rotation Continues

Nearing the end of the review period, we forecast 8 changes for the ChiNext Index (SZ399006 INDEX) and 5 changes for the ChiNext 50 Index in December.
Given stock selection uses liquidity as a major input, the impact of passive trading will be much larger on the deletions as compared to the additions.
The potential adds have outperformed the potential deletes, but relative performance has been drifting lower over the last few months. There are stocks that will have flows from other indices.

Micron Technology Inc.: Unpacking the Strategies Behind Their Recent Financial Performance! – Major Drivers

Micron Technology, Inc. delivered a positive result and managed an all-around beat last quarter.
Their management has provided insights into the ongoing underutilization charges and inventory write-downs that have impacted the company’s financials.
This rise in underutilization has led to corresponding charges in the fourth quarter, which are expected to continue into fiscal year 2024.

Marizyme, Inc. – DuraGraft Approved for US Markets

Key milestone in FDA approval. On October 6, Marizyme, Inc. (MRZM) announced a key milestone in its growth strategy, with FDA approval of its flagship DuraGraft (DG) technology for the US market.
Improved outcomes when used in cardiac care. DG has been proven to result in significantly improved outcomes and lower costs for cardiac surgery through multiple clinical trials as well as utilization in selected markets in Europe and Asia where adoption has recently accelerated.
Reflecting that, YTD DG-driven revenue is already more than double the level of 2022.

Paychex Inc.: Decoding Their Investments In AI & What It Means for the Future! – Major Drivers

Paychex, Inc. managed to exceed analyst expectations in terms of revenue as well as earnings.
The company has commenced fiscal year 2024 with robust results, including a 7% growth in total revenue and an 11% increase in adjusted diluted earnings per share.
Strong new sales revenue growth was driven by continued demand for HR technology and advisory solutions.

FactSet Research Systems Inc.: Are The Latest AI Investments Expected To Catalyze Revenue Growth? – Major Drivers

FactSet Research Systems Inc. delivered a mixed result in the quarter, with revenues above market expectations but failed to surpass the analyst consensus regarding earnings.
The success in 2023 stemmed from the growth of enterprise offerings, leading to significant strategic wins across various workflows.
Besides that, their content refinery, extensive data offerings, and innovations in user experience, including conversational interfaces and generative AI, position FactSet Research Systems for continued growth.

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Oct 10

Daily Brief Credit: Morning Views Asia: Hopson Development and more

By Smartkarma Daily Briefs | Credit, Daily Briefs

In today’s briefing:

Morning Views Asia: Hopson Development, Lenovo, Tata Steel Thailand, West China Cement

Morning Views Asia: Hopson Development, Lenovo, Tata Steel Thailand, West China Cement

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.

Hopson Development
Lenovo
Tata Steel Thailand
West China Cement

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Oct 10

Daily Brief Event-Driven: October 2023 TOPIX Free Float Review – $22.6bn to Trade and JPB (7182) The Biggie and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

October 2023 TOPIX Free Float Review – $22.6bn to Trade and JPB (7182) The Biggie
Korea – Positioning in Stocks That Could Have Global Passive Flows
TOPIX Inclusions: Who Is Ready (Oct 2023)
Prime Target for Flow Trading Due to Low Pre-Exposure in December KOSPI 200 Rebalancing
HSCEI Index Rebalance Preview: One Change; Capping Impact Increases
ChiNext/ChiNext50 Index Rebalance Preview: Sector Rotation Continues
No Danger in Being Long
EQD | HSI WEEKLY Resistance Levels UPDATED

October 2023 TOPIX Free Float Review – $22.6bn to Trade and JPB (7182) The Biggie

By Travis Lundy

The TOPIX October Free Float Weight Review details are out. This is the biggest FFW review of the year. This year, it’s $11.3bn a side.
As discussed in Japan Post Bank (7182) – The October TOPIX FFW Adjustment, JPB is the big buy. $2bn/23d of ADV. There is $2bn to buy of trading cos too.
There are lots of large names to trade in both directions. If you have interests to sell the buys and vice versa, it is good to know the flows.

Korea – Positioning in Stocks That Could Have Global Passive Flows

Posco DX (022100), Kum Yang (001570), SK Telecom (017670), Lotte Energy Materials (020150), Kakao Games (293490), Pan Ocean (028670), BGF retail (282330), Netmarble (251270) have been on investors/traders radars recently.
There could be liquidity events in some of the stocks next month as passive index trackers look to buy/sell the stocks.
Foreign investors have sold Lotte Energy Materials (020150 KS), Kakao Games (293490 KS), Pan Ocean (028670 KS) and Netmarble (251270 KS) while buying BGF retail (282330 KS).

TOPIX Inclusions: Who Is Ready (Oct 2023)

By Janaghan Jeyakumar, CFA

Quiddity’s “Who is Ready” series of insights aims to objectively identify names listed on the Tokyo Stock Exchange that are potential additions to the TOPIX Index in future.
Since my last insight, CellSource (4880 JP) and Kasumigaseki Capital (3498 JP) have confirmed they will move to TSE Prime which means they will be included in TOPIX at end-November.
FP Partner (7388 JP) and I-NE (4933 JP) will get included in TOPIX at the end of October.

Prime Target for Flow Trading Due to Low Pre-Exposure in December KOSPI 200 Rebalancing

By Sanghyun Park

Posco DX’s KOSPI 200 fast entry effective date will likely coincide with the December regular rebalancing date.
We should focus on the ad-hoc change deletion as we can expect more pronounced price impact near the effective date due to lower chances of premature exposure than regular reviews.
The following three candidates are screened: K Car, Daesang Corporation, and Shinsegae International. They are all likely to exhibit a significant passive impact (x ADTV).

HSCEI Index Rebalance Preview: One Change; Capping Impact Increases

Zhongsheng Group (881 HK) is in deletion zone and could be deleted. China Unicom Hong Kong (762 HK) could be added to the index as the highest ranked non-index constituent.
Estimated one-way turnover at the rebalance is 2.14% resulting in a one-way trade of HK$1.38bn. Meituan (3690 HK), Alibaba Group (9988 HK) and Tencent (700 HK) will be capped higher.
China Unicom Hong Kong (762 HK) is supported on its 50/100 day moving averages and could move higher. Zhongsheng Group (881 HK) has been trading below its moving averages.

ChiNext/ChiNext50 Index Rebalance Preview: Sector Rotation Continues

Nearing the end of the review period, we forecast 8 changes for the ChiNext Index (SZ399006 INDEX) and 5 changes for the ChiNext 50 Index in December.
Given stock selection uses liquidity as a major input, the impact of passive trading will be much larger on the deletions as compared to the additions.
The potential adds have outperformed the potential deletes, but relative performance has been drifting lower over the last few months. There are stocks that will have flows from other indices.

No Danger in Being Long

By Jesus Rodriguez Aguilar

The 1,350p offer for Ergomed Plc (ERGO LN) (28% premium, 18.9x EV/Fwd NTM EBITDA using IBES estimated) seems optically attractive considering share underperformance, and in line with closest peer Medpace at 19.06x.
Nevertheless there’d be synergies available to a trade buyer and other than 18% from the Founder, there aren’t any other irrevocables, which indicates the offer price is far from knock-out.
I set my TP at 1,350p. Spread turned negative last week, now 0.59%/1.71% (gross/annualised, assuming settlement by mid-February). I would be long considering there’s still time for a competing offer.

EQD | HSI WEEKLY Resistance Levels UPDATED

By Nico Rosti

The HSI INDEX has fallen for 2 more weeks since our last insight – current CC is =-5, and Q3 support was breached last week, the index is clearly OVERSOLD.
If the HSI bounces this week, it could be an occasion to go SHORT – take note that the index could take 3 weeks to rally before rolling down again.
The target price area where to enter SHORT trades,to benefit from a continuation of the downtrend is: 17598-18784.

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Oct 10

Daily Brief Energy/Materials: EcoPro Materials, South32 Ltd, Valeura Energy Inc, Granite Ridge Resources , Brooge Energy Ltd, West China Cement and more

By Smartkarma Daily Briefs | Daily Briefs, Energy & Materials Sector

In today’s briefing:

EcoPro Materials IPO: The Bull Case
Have South32 Shares Bottomed Out?
Valeura Energy (TSE VLE): ~20 mbbl/d production in 2Q23
Granite Ridge Resources, Inc. – Private Equity Growth Strategy in a Public E&P Company
Brooge Energy: Why Is GULFNAV Eyeing The Oil Storage & Energy Services Provider?
Morning Views Asia: Hopson Development, Lenovo, Tata Steel Thailand, West China Cement

EcoPro Materials IPO: The Bull Case

By Arun George

EcoPro Materials (ECO123 KS) is a leading player in the electrode material industry. It is seeking to raise up to US$500 million in a KRX IPO.
EcoPro Materials is offering 14.5 million shares at an IPO price range of KRW36,200-46,000 per share. Book building runs from 30 October to 3 November, with pricing on 7 November.
The bull case rests on attractive addressable markets, aggressive production capacity expansion, ambition to be the leading non-Chinese player, strong revenue growth and improving cash conversion cycle.

Have South32 Shares Bottomed Out?

By Pranay Yadav

South32 is an Australian metal and mining firm spun off from BHP in 2015. Unlike mining majors, South32 holds smaller but concentrated assets.
Aluminium operations is the firm’s primary revenue source followed by coking coal operations. Coking coal contributes to 32% of the underlying EBITDA.
With its share price having got battered, South32 stock is compellingly priced relative to MVR ETF paving way for a compelling long-short trade.

Valeura Energy (TSE VLE): ~20 mbbl/d production in 2Q23

By Auctus Advisors

2Q23 production was 19,961 bbl/d with the difference to our forecast mostly reflecting the timing of drilling.
Wassana (1.6 mbbl/d production during 2Q23) was offline in 3Q23.
Our YE24 estimated net cash (~US$450 mm given the late tax restructuring) represents 1.6x the current market cap of the company.

Granite Ridge Resources, Inc. – Private Equity Growth Strategy in a Public E&P Company

Granite Ridge was formed in 2022 to execute a private equity investment strategy in a public company vehicle.
The strategy is to allocate capital to non-operated oil and natural gas development opportunities in order to grow the company’s underlying asset base and support its common stock dividend.
Grey Rock Investment Partners contributed the assets of three investment funds to facilitate Granite Ridge’s business combination transaction with Executive Network Partnering Corporation (ENPC).

Brooge Energy: Why Is GULFNAV Eyeing The Oil Storage & Energy Services Provider?

This is a special one-time report on Dubai’s premier oil storage and service provider, Brooge Energy.
This intriguing proposal has surprisingly not elicited a significant uptick in Brooge Energy’s stock price, a phenomenon that has left market watchers and potential investors curious and slightly bewildered.
In this report, we have carried out a fundamental analysis of the historical financial statements of the company.

Morning Views Asia: Hopson Development, Lenovo, Tata Steel Thailand, West China Cement

Hopson Development
Lenovo
Tata Steel Thailand
West China Cement

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Oct 10

Daily Brief ECM: EcoPro Materials IPO: The Bull Case and more

By Smartkarma Daily Briefs | Daily Briefs, ECM

In today’s briefing:

EcoPro Materials IPO: The Bull Case
Seoul Guarantee Insurance IPO Industry Analysis
Tianju Dihe Technology IPO Preview: Data Drives The Future
As a Group, Typical SHEIN & Temu Users in the US Lack Political Clout; Why It Matters
Lalatech Holdings Pre-IPO – Refiling Updates – Growth and Profit Pickup but Valuation Gap Remains
Juniper Hotels Pre-IPO Tearsheet

EcoPro Materials IPO: The Bull Case

By Arun George

EcoPro Materials (ECO123 KS) is a leading player in the electrode material industry. It is seeking to raise up to US$500 million in a KRX IPO.
EcoPro Materials is offering 14.5 million shares at an IPO price range of KRW36,200-46,000 per share. Book building runs from 30 October to 3 November, with pricing on 7 November.
The bull case rests on attractive addressable markets, aggressive production capacity expansion, ambition to be the leading non-Chinese player, strong revenue growth and improving cash conversion cycle.

Seoul Guarantee Insurance IPO Industry Analysis

By Douglas Kim

In this insight, we provide additional industry analysis of Seoul Guarantee Insurance Corp which is getting ready to complete its IPO in Korea in the next several weeks.
The IPO of Seoul Guarantee Insurance is an important signal that the Korean government may allow greater competition in the local surety insurance market in 2-3 years.
SGIC has promised high dividends. If we assume the IPO price at the low end of the IPO price range (39,500 won), this would suggest a dividend yield of 8%.

Tianju Dihe Technology IPO Preview: Data Drives The Future

By Andrei Zakharov

Tianju Dihe Technology, more commonly known as Juhe Data, filed to go public in Hong Kong. The company provides standard API services through its APIHub marketplace in China.
Tianju Dihe Technology plans to trade on the HKSE, and CITIC Securities is leading the IPO. The company was backed by JD Technology, a fintech unit of JD.com.
With a market leadership position and a mission to empower the digital economy with data technologies, I have no doubt that Tianju Dihe Technology will have a successful IPO.

As a Group, Typical SHEIN & Temu Users in the US Lack Political Clout; Why It Matters

By Daniel Hellberg

US users of the popular SHEIN and Temu shopping apps tend to be relatively young
Compared to older Americans, younger Americans (18-34) tend to have less political clout
What does this mean for SHEIN and Temu, and how will they respond to political challenges?

Lalatech Holdings Pre-IPO – Refiling Updates – Growth and Profit Pickup but Valuation Gap Remains

By Sumeet Singh

Lalatech Holdings Co Ltd (LALA HK) is looking to raise about US$1bn in its upcoming HK IPO.
Lalatech operates via a marketplace model serving merchants and carriers. Its platform facilitates closed-loop transactions from online shipping order booking to intelligent order matching, and automated dispatching to after-sale services.
We have looked at the company’s past performance in our earlier notes. In this note we will talk about the updates from its refiling.

Juniper Hotels Pre-IPO Tearsheet

By Ethan Aw

Juniper Hotels (6593708Z IN) is looking to raise up to US$217m in its upcoming India IPO. The deal will be run by JM Financial, CLSA and ICICI Securities.
Juniper Hotels is the largest owner by no. of keys of Hyatt affiliated hotels in India as of 2Q23 (30th Jun 23), according to Horwath.
The company is jointly held by Saraf Hotels and its affiliate, Juniper Investments and Two Seas Holdings (an indirect subsidiary of Hyatt Hotels Corporation).

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Oct 10

Daily Brief Thematic (Sector/Industry): Ohayo Japan: Stocks Ignore Conflict; Japan’s Used Car Sales to Russia Hit the Brakes and more

By Smartkarma Daily Briefs | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

Ohayo Japan: Stocks Ignore Conflict; Japan’s Used Car Sales to Russia Hit the Brakes
US – Fed Liquidity Moves USD147bn Lower In Past 3 Weeks, Pace Is Accelerating
Luxury Goods – What Makes a Brand Unique?
China TMT Update-Oct.10-Baba/LI/NIO/XPEV/Tencent/NetEase-Huawei Wenjie’s New M7/New Taobao Rules
Cannabis News for the Week Ending October 6, 2023

Ohayo Japan: Stocks Ignore Conflict; Japan’s Used Car Sales to Russia Hit the Brakes

By Mark Chadwick

Overnight: S&P gained 0.6% as market shook off initial concerns over conflict in Middle East. Bond market closed; Oil +4%
Japan: BlackRock, the world’s largest asset manager, is looking to collaborate with Japanese businesses to invest in decarbonization technology.
JapanX: Japan has recently imposed strict restrictions on its used car sales to Russia, significantly impacting a thriving trade worth nearly $2 billion annually

US – Fed Liquidity Moves USD147bn Lower In Past 3 Weeks, Pace Is Accelerating

By Daniel Tabbush

US Federal Reserve Bank balance sheets are released weekly and more current than commercial banks. Latest Fed B/S is for 4 October, shows -USD47bn WoW in loans, securities, repos.
Liquidity conditions in the US banking system are becoming tighter faster, with the most recent week showing loans, securities, repos at -9.4% YoY vs -8.3% four weeks ago.
With tighter liquidity we should expect less loan growth, but also more difficult conditions for cash-strapped companies, prompting more defaults, and higher credit costs at banks.

Luxury Goods – What Makes a Brand Unique?

By Alexis Dwek

Why do certain brands like LV, Hermes and Cartier keep on delivering extraordinary results?
Which luxury brands will be able to continue to raise their prices well above inflation in the medium and long term?
If you don’t have a story for your brand, what is your brand worth?

China TMT Update-Oct.10-Baba/LI/NIO/XPEV/Tencent/NetEase-Huawei Wenjie’s New M7/New Taobao Rules

By Shawn Yang

BABA：SME merchants benefited from new Taobao rules ( + )
LI/NIO/XPEV: The cumulative large deposit order volume of Wenjie’s new M7 has exceeded 50,000 units(-)
Gaming Industry: August Market Sustains Ongoing Recovery with Impressive 46% YoY Growth in Domestic Market(+)

Cannabis News for the Week Ending October 6, 2023

Global equities ended the week up modestly, with the MSCI World Index returning 0.07%. US indices fared worse, with the S&P 500 -0.48%, NASDAQ -0.59%, and Russell 2000 -1.56%. Most of the declines were due to a strong jobs report that sent interest rates higher, and stocks lower.
Cannabis stocks fell again this week with the US cannabis MSOS ETF falling 10.83% and the global YOLO ETF dropping 8.19%.
MSOS has now retraced more than 50% of the gains since the HHS announcement on August 30.

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Oct 10

Daily Brief Equity Bottom-Up: Money Forward (3994) | Show Me the Money and more

By Smartkarma Daily Briefs | Daily Briefs, Equity Bottom-Up

In today’s briefing:

Money Forward (3994) | Show Me the Money
Hisamitsu Pharmaceutical (4530 JP): Mixed Q2FY24 Result- Some Points Worth of Paying Attention
Eicher Motors (EIM IN) | Competitive Position Strengthening
WuXi AppTec (2359.HK/603259.CH) – Would the Recent Rebound in Share Price Be a Flash in the Pan?
Have South32 Shares Bottomed Out?
[Week 6] Namaste India 🙏 | TTAN’s Glittery Update and Earnings Workbook
Valeura Energy (TSE VLE): ~20 mbbl/d production in 2Q23
Marizyme, Inc. – DuraGraft Approved for US Markets
Granite Ridge Resources, Inc. – Private Equity Growth Strategy in a Public E&P Company
Micron Technology Inc.: Unpacking the Strategies Behind Their Recent Financial Performance! – Major Drivers

Money Forward (3994) | Show Me the Money

By Mark Chadwick

Money Forward’s share price dipped 20% post-Q2 results, but strong operational performance and upward sales revisions make it appealing.
We expect 42% YoY sales growth in Q3 and believe long-term growth prospects remain exceptional against the market size.
Management to deliver profitability next FY, meeting investor demands to “show me the money” – we remain bullish

Hisamitsu Pharmaceutical (4530 JP): Mixed Q2FY24 Result- Some Points Worth of Paying Attention

By Tina Banerjee

Hisamitsu Pharmaceutical Co (4530 JP) announced mixed Q2FY24 result, with single-digit revenue growth and bottom-line decline. Revenue grew 5% YoY to ¥34.9B, while operating profit declined 8% YoY to ¥4B.
Salonpas line of OTC pain relieving patches have become major growth driver of the company. In Q2FY24, Salonpas revenue increased 14% YoY, lowest growth rate reported in last five quarters.
Despite 70%+ progress of operating and net profits, Hisamitsu reiterated FY24 guidance. Declining margins, anticipated increase in SG&A expenses, and high base call for massive fall in profit in H2FY24.

Eicher Motors (EIM IN) | Competitive Position Strengthening

By Pranav Bhavsar

Our dealer checks across a couple of Eicher Motors (EIM IN) and Bajaj Auto Ltd (BJAUT IN) dealerships indicate a strengthening competitive position for Royal Enfield.
After the initial hype, customers are now shifting back to Royal Enfield.
As competition ramps up production, we continue to believe that the market will expand, and there will be no fight for market share.

WuXi AppTec (2359.HK/603259.CH) – Would the Recent Rebound in Share Price Be a Flash in the Pan?

By Xinyao (Criss) Wang

WuXi AppTec’s share price has performed well recently, mainly driven by CXO’s “immune attributes” to anti-corruption campaign, investors’ bullish view of weight loss drug business, and the previous oversold rebound.
Peptide CDMO business would contribute limited incremental performance to WuXi AppTec considering overall large business volume.Downward trend of CRO business is hard to be hedged by weight loss drug business.
Due to higher-for-longer rate, China CXOs only have rebound value, but no reversal logic. It’s time to consider taking profits in a timely manner before the share price falls again.

Have South32 Shares Bottomed Out?

By Pranay Yadav

South32 is an Australian metal and mining firm spun off from BHP in 2015. Unlike mining majors, South32 holds smaller but concentrated assets.
Aluminium operations is the firm’s primary revenue source followed by coking coal operations. Coking coal contributes to 32% of the underlying EBITDA.
With its share price having got battered, South32 stock is compellingly priced relative to MVR ETF paving way for a compelling long-short trade.

[Week 6] Namaste India 🙏 | TTAN’s Glittery Update and Earnings Workbook

By Pranav Bhavsar

The index seems to be finding support at 19,500 for the second consecutive week. Bullish momentum could resume when we close above 19,800 on the NIFTY Index (NIFTY INDEX) .
Names discussed include Titan Co Ltd (TTAN IN), Maruti Suzuki India (MSIL IN) and Metro Brands (METROBRA IN).
We also introduce the Earnings Diary which will be part of the publication, tracking estimates and narratives around over coverage.

Valeura Energy (TSE VLE): ~20 mbbl/d production in 2Q23

By Auctus Advisors

2Q23 production was 19,961 bbl/d with the difference to our forecast mostly reflecting the timing of drilling.
Wassana (1.6 mbbl/d production during 2Q23) was offline in 3Q23.
Our YE24 estimated net cash (~US$450 mm given the late tax restructuring) represents 1.6x the current market cap of the company.

Marizyme, Inc. – DuraGraft Approved for US Markets

Key milestone in FDA approval. On October 6, Marizyme, Inc. (MRZM) announced a key milestone in its growth strategy, with FDA approval of its flagship DuraGraft (DG) technology for the US market.
Improved outcomes when used in cardiac care. DG has been proven to result in significantly improved outcomes and lower costs for cardiac surgery through multiple clinical trials as well as utilization in selected markets in Europe and Asia where adoption has recently accelerated.
Reflecting that, YTD DG-driven revenue is already more than double the level of 2022.

Granite Ridge Resources, Inc. – Private Equity Growth Strategy in a Public E&P Company

Granite Ridge was formed in 2022 to execute a private equity investment strategy in a public company vehicle.
The strategy is to allocate capital to non-operated oil and natural gas development opportunities in order to grow the company’s underlying asset base and support its common stock dividend.
Grey Rock Investment Partners contributed the assets of three investment funds to facilitate Granite Ridge’s business combination transaction with Executive Network Partnering Corporation (ENPC).

Micron Technology Inc.: Unpacking the Strategies Behind Their Recent Financial Performance! – Major Drivers