Daily Briefs

Gensol clarified that debt woes are because of short term liability mismatch which contradicts with Lender’s clarification
Promoter said they will buy from the open market and will also infuse money into company but their recent stake sale again contradicts.
2nd CFO Resignation within 6 months further raises alarm over governance issues.

[JD.com, Inc (JD US, BUY, TP US$52) Earnings Review]: Market Calls for Longer-Term Growth Drivers

By Ying Pan

JD C4Q24 revenue exceeded our estimate/consensus by 3%/4% and adjusted NI by 16%/19%, driven by subsidies and logistic efficiency gains.
We expect JD to maintain 11% YoY revenue growth in C1H25 but moderate to 5.9% in 2H.
We maintain JD.com’s TP at US$ 52 and the BUY rating. Market concern on lack of details for long term driver is valid but JD.com still has time.

JD Logistics Q424 Earnings: Taobao / Tmall Access Fails to Generate Expected Benefits

By Daniel Hellberg

Investors had hoped to see tangible benefits of Taobao / Tmall access in Q424 results
But revenue growth acceleration was unimpressive, and core margins fell noticeably
We believe its disappointing Q424 numbers will result in near-term underperformance

National Aluminium (NACL IN) New Capacities and Cheap Valuations to Drive Returns

NACL posted its best ever quarterly performance in 3QFY25, driven by a sharp spike in alumina prices. Alumina prices have since cooled off but remain elevated at above US$450/t
NACL is set to expand its alumina capacity by 33% over the next 12 months. This will help double its external alumina sales from 1mt to 2mt.
Trades at 25% discount to historic PE of 13x despite record earnings, healthy balance sheet and strong near-term volume growth driven by brownfield expansion.

Hindalco (HNDL IN): Several Positive Triggers

Play on rising aluminium demand. Aluminium demand has outpaced supply with strong Chinese demand.
Management has guided better margins at Novelis which faced a temporary drop in margins due to scrap shortages.
Hindalco’s Indian operations are fully integrated with captive bauxite, alumina and to certain extent for energy. Trades at a 20%+ discount to its historic PE multiples.

Jai Corp Ltd Under CBI Investigation: Allegations of Fund Diversion and Money Laundering

Jai Corp Ltd (JFI IN) allegedly misappropriated INR2,434 crore from investors, diverted funds offshore, and engaged in fraudulent trading, triggering CBI probe into financial misconduct, money laundering, illegal stock manipulation.
The Bombay High Court directed a CBI investigation after allegations surfaced of fake exports, foreign currency loan diversion, and fund rotation through shell companies in Mauritius and Jersey.
Jai Corp claims no official notice of the FIR yet but pledges full cooperation; investors await regulatory actions from SEBI, RBI, and ED, which could impact the company’s financial standing.

Ameren Corporation: Renewable Energy & Infrastructure Development To Drive Community Economic Growth!

Ameren Corporation reported strong operational and financial results for 2024, marked by strategic investments and regulatory successes.
The company achieved adjusted earnings of $4.63 per share, surpassing the previous year’s $4.38 per share and exceeding the adjusted earnings guidance midpoint for 2024.
This growth was largely driven by strategic infrastructure investments and weather-normalized retail sales growth of approximately 2% across Ameren Missouri.

CenterPoint Energy: These Are The 6 Critical Factors That Will Define Its Success In 2025 & Beyond!

CenterPoint Energy reported its fourth quarter and full year 2024 earnings, showcasing both positive and challenging aspects.
The company achieved a non-GAAP earnings per share (EPS) of $0.40 for the fourth quarter and $1.62 for the full year, reflecting an 8% increase over the previous year.
This marks the fourth consecutive year of meeting or exceeding annual non-GAAP EPS guidance.

Brookfield Renewable Partners: Adapting to Regulatory and Market Changes to Bolster Resilience & Growth Prospects!

Brookfield Renewable Partners recently reported its fourth-quarter 2024 results, marking a year of significant operational and financial achievements.
The company delivered its strongest financial performance to date, driven by a robust demand for its low-cost renewable energy.
The company reported a 10% increase in funds from operations (FFO) per unit year-on-year, fueled by inflation-linked and contracted cash flows, strategic acquisitions, and organic growth initiatives.

American Water Works: Infrastructure Investment & Rate Base Growth to Sustain The Growth Trajectory!

American Water’s recent conference call focused on several key aspects of their financial and operational performance during 2024, as well as future outlooks.
Delivered earnings per share (EPS) for the year stood at $5.39, reflecting an 8% growth owing to favorable weather conditions and strategic investments.
Notably, $3 billion was invested into capital initiatives, while regulatory efforts resulted in successful rate case agreements across multiple jurisdictions.

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Mar 09

Daily Brief Macro: Overview #18 – Tipping Point Arrived for Major Trend Changes? and more

By Smartkarma Daily Briefs | Daily Briefs, Macro

In today’s briefing:

Overview #18 – Tipping Point Arrived for Major Trend Changes?

Overview #18 – Tipping Point Arrived for Major Trend Changes?

By Rikki Malik

A review of recent events/data impacting our investment themes or outlook
The weak USD, as US growth peaks and yields decline, is helping international markets
Can Hong Kong and China stock markets decouple from a US bear market?

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Mar 09

Most Read: Xiamen Amoytop Biotech Co Ltd, BYD, Alibaba Group Holding , SUNeVision Holdings, Amazon.com Inc, A2 Milk Co Ltd, Japan Post Bank, Korea Zinc, Seven & I Holdings and more

By Smartkarma Daily Briefs | Daily Briefs, Most Read

In today’s briefing:

7&I (3382) – A Starting Point for the Standalone Plan – The Good, The Bad, The Ugly
STAR50/STAR100 Index Rebalance: Methodology Changes & Some Surprises
BYD (1211 HK) Placement: Continuing to Power Up
HSI, HSCEI, HSTECH, HSIII Index Rebalance: US$5.3bn of Flows Post Capping (Mar 2025)
Sunevision (1686 HK): Data Center Rally Brings Passive Flows
Select Sector Indices and S&P Equal Weight Rebalance Preview: Capping Changes & US$13bn Trade
S&P/NZX 10 Index Rebalance: A2 Milk (ATM NZ) Replaces Ryman Healthcare (RYM NZ)
Japan Post Bank (7182 JP) – Not Cheap Enough Vs Others, or Holdings
M&A For Korea Zinc: Seoul Central District Court Makes Important Rulings
Seven & I Holdings: Mega Share Buyback Plan and IPO of North American CVS Unit to Boost Share Price

7&I (3382) – A Starting Point for the Standalone Plan – The Good, The Bad, The Ugly

By Travis Lundy

Today, partway through the day, we got a Bloomberg article suggesting a large-scale buyback was to come. Post-close, we got the full details.
“Seven & i Holdings Announces Plan to Unlock Shareholder Value Through Leadership Changes and Transformational Capital and Business Initiatives”.
Sale of York. Management change. Update on Special Committee work with ACT. Commitment to return ¥2trln to shareholders via buybacks by FY2030. Higher divs. IPO of 7-Eleven Inc (US).

STAR50/STAR100 Index Rebalance: Methodology Changes & Some Surprises

There are 3 constituent changes for the STAR50 INDEX and 6 changes for the STAR100 Index at the March rebalance that will be implemented at the close on 14 March.
The last-minute methodology change could lead to under/over positioning on some names and those stocks could move the most over the next few days.
Performance has been mixed in the changes to the STAR50 INDEX but the outright adds have continued to outperform the outright deletes for the STAR100 Index.

BYD (1211 HK) Placement: Continuing to Power Up

Overnight, BYD (1211 HK) has announced a placement of 118m shares at a price range of HK$333-345/share that could raise up to HK$40.7bn (US$5.2bn).
The Pink Sheets listing for BYD (BYDDY.PK) closed at US$87.1/share and traded US$155m for the day. That close implies an open of HK$338.7/share for BYD, middle of the placement range.
There will be passive buying from global index trackers later this week while buying from Hang Seng Index and Hang Seng China Enterprises Index trackers will come in April.

HSI, HSCEI, HSTECH, HSIII Index Rebalance: US$5.3bn of Flows Post Capping (Mar 2025)

The March rebalance of the HSI, HSCEI INDEX, HSTECH and HSIII indices will use today’s closing prices to cap the index constituent weights at 8%/12%. This leads to large flows.
The gross round-trip trade across all stocks across the four indices is estimated at HK$41.1bn (US$5.3bn). The net round-trip trade is HK$37.3bn (US$4.8bn).
Meituan , JD.com, Baidu, Horizon Robotics, ICBC, BeiGene, Kuaishou Technology and China Construction Bank are the largest buys. Alibaba, Xiaomi, HSBC, ZhongAn Online and Tencent are the largest sells.

Sunevision (1686 HK): Data Center Rally Brings Passive Flows

The huge rally in SUNeVision Holdings (1686 HK) will bring passive inflows to the stock after being added to a global sector index.
Estimated passive buying is 19.4m shares (US$22m; 0.55x ADV) with implementation scheduled for the close of trading on 21 March.
Shorts have risen sharply in the last couple of weeks and cumulative excess volume has jumped too. But we see a similar pattern in a close peer.

Select Sector Indices and S&P Equal Weight Rebalance Preview: Capping Changes & US$13bn Trade

Constituent changes to the S&P 500 INDEX (SPX INDEX), S&P Midcap400 Index and S&P SmallCap600 Index for the March rebalance will be announced after market close on Friday.
There will also be capping changes for the Select Sector indices that will result in a round-trip trade of US$13.1bn. Constituent changes will add to that flow.
The largest inflows will be in Amazon.com, Tesla, Microsoft, NVIDIA, Alphabet (GOOGL US) and Electronic Arts. Largest outflows are from Broadcom, Meta Platforms, Linde, Mcdonald’s Corp and Take Two Interactive.

S&P/NZX 10 Index Rebalance: A2 Milk (ATM NZ) Replaces Ryman Healthcare (RYM NZ)

A2 Milk Co Ltd (ATM NZ) will replace Ryman Healthcare (RYM NZ) in the S&P/NZX 10 Index at the close of trading on 21 March.
Passive trackers will need to buy 0.8x ADV in A2 Milk Co Ltd (ATM NZ) and will need to sell 1.2x ADV in Ryman Healthcare (RYM NZ).
Importantly, A2 Milk Co Ltd (ATM NZ) is a deletion from a global index at the close on 21 March and the selling from those passive trackers is far larger.

Japan Post Bank (7182 JP) – Not Cheap Enough Vs Others, or Holdings

By Travis Lundy

The Offering of Japan Post Bank (7182 JP) is not taking place the way “the right pattern” would suggest, but last time was kind of special. This time is different.
Last time was a “second IPO” and coincided with a US regional bank crisis. This time the offering is smaller outright, and much smaller as a portion of float.
Pricing is Monday. It hasn’t moved much vs JPH. It needs to move more to be attractive. And there is still a bit of overhang to come.

M&A For Korea Zinc: Seoul Central District Court Makes Important Rulings

By Douglas Kim

On 7 March, the Seoul Central District Court ruled that it is reasonable for Korea Zinc to maintain the concentrated voting system, which should favor Chairman Choi and his allies.
On the other hand, the court also ruled that Korea Zinc was wrong to restrict Young Poong’s voting rights which should be favorable to MBK/Young Poong alliance.
The fact that the court has allowed concentrated voting system would mean the M&A of Korea Zinc will continue.

Seven & I Holdings: Mega Share Buyback Plan and IPO of North American CVS Unit to Boost Share Price

By Douglas Kim

If indeed the company proceeds with 2 trillion yen buyback over five years, this would represent buyback of about 7.3% of its shares per year (37% of market cap).
Seven & I Holdings’ plans to massively buyback shares and IPO its North American CVS business are major catalysts that should have positive impact both near and long term.
Certainly, the company’s action plan to sell its non-core assets (including supermarket, restaurant, and specialty stores) to Bain Capital for $5.5 billion is a step in the right direction.

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Mar 09

Daily Brief United States: Ameren Corporation, American Water Works Co, Cms Energy Corp, Black Hills, Brookfield Renewable , Centerpoint Energy, Atmos Energy, Constellation Energy , Dominion Energy Inc, Aes Corp and more

By Smartkarma Daily Briefs | Daily Briefs, United States

In today’s briefing:

Ameren Corporation: Renewable Energy & Infrastructure Development To Drive Community Economic Growth!
American Water Works: Infrastructure Investment & Rate Base Growth to Sustain The Growth Trajectory!
CMS Energy: Expanding Renewable Energy Capabilities For A Competitive Edge In The Evolving Energy Landscape!
Black Hills Corporation: Is The Data Centre Demand Here To Stay?
Brookfield Renewable Partners: Adapting to Regulatory and Market Changes to Bolster Resilience & Growth Prospects!
CenterPoint Energy: These Are The 6 Critical Factors That Will Define Its Success In 2025 & Beyond!
Atmos Energy: An Insight Into Its Robust Financing Strategy
Constellation Energy Group: Can Its Strategic Nuclear Uprates & Expansion Reinforce The Company’s Position In Clean Energy Markets?
Dominion Energy: Expansion of Data Centers in Virginia to Solidify Foothold In the Burgeoning Sector!
AES Corporation: Renewable Energy Growth & Investment Progress Driving Our Optimism!

Ameren Corporation: Renewable Energy & Infrastructure Development To Drive Community Economic Growth!

Ameren Corporation reported strong operational and financial results for 2024, marked by strategic investments and regulatory successes.
The company achieved adjusted earnings of $4.63 per share, surpassing the previous year’s $4.38 per share and exceeding the adjusted earnings guidance midpoint for 2024.
This growth was largely driven by strategic infrastructure investments and weather-normalized retail sales growth of approximately 2% across Ameren Missouri.

American Water Works: Infrastructure Investment & Rate Base Growth to Sustain The Growth Trajectory!

American Water’s recent conference call focused on several key aspects of their financial and operational performance during 2024, as well as future outlooks.
Delivered earnings per share (EPS) for the year stood at $5.39, reflecting an 8% growth owing to favorable weather conditions and strategic investments.
Notably, $3 billion was invested into capital initiatives, while regulatory efforts resulted in successful rate case agreements across multiple jurisdictions.

CMS Energy: Expanding Renewable Energy Capabilities For A Competitive Edge In The Evolving Energy Landscape!

CMS Energy Corporation recently released its financial results, providing insights into the company’s operational performance and future investment plans.
The company reported adjusted net income for 2024 at $998 million, which equates to $3.34 per share, aligning towards the high end of their guidance range.
This marks consistency in execution, backed by effective cost management and strategic investments in customer service and renewable energy.

Black Hills Corporation: Is The Data Centre Demand Here To Stay?

Black Hills Corporation’s Q4 and full-year 2024 earnings call outlined a range of strategic, operational, and financial updates, reflecting both positive outcomes and challenges.
The company successfully advanced its customer-focused strategy, achieving key objectives, including meeting its earnings guidance and maintaining strong financial health.
Despite facing mild weather and unplanned generation outages, Black Hills effectively managed expenses, aligning its financial performance with expectations.

Brookfield Renewable Partners: Adapting to Regulatory and Market Changes to Bolster Resilience & Growth Prospects!

Brookfield Renewable Partners recently reported its fourth-quarter 2024 results, marking a year of significant operational and financial achievements.
The company delivered its strongest financial performance to date, driven by a robust demand for its low-cost renewable energy.
The company reported a 10% increase in funds from operations (FFO) per unit year-on-year, fueled by inflation-linked and contracted cash flows, strategic acquisitions, and organic growth initiatives.

CenterPoint Energy: These Are The 6 Critical Factors That Will Define Its Success In 2025 & Beyond!

CenterPoint Energy reported its fourth quarter and full year 2024 earnings, showcasing both positive and challenging aspects.
The company achieved a non-GAAP earnings per share (EPS) of $0.40 for the fourth quarter and $1.62 for the full year, reflecting an 8% increase over the previous year.
This marks the fourth consecutive year of meeting or exceeding annual non-GAAP EPS guidance.

Atmos Energy: An Insight Into Its Robust Financing Strategy

Atmos Energy Corporation reported impressive fiscal 2025 first-quarter results with a net income of $352 million, translating into $2.23 per diluted share, a 7.2% increase compared to the previous year’s quarter.
The company’s operating income rose by 15% to $459 million, buoyed by rate increases across its operating segments, which contributed $69 million, and customer growth.
The organization added over 59,000 new customers over the past year, with substantial growth noted in Texas.

Constellation Energy Group: Can Its Strategic Nuclear Uprates & Expansion Reinforce The Company’s Position In Clean Energy Markets?

Constellation Energy Corporation reported robust financial results for the third quarter of 2024, driven by its strong operational performance and strategic positioning within the energy sector.
The company delivered GAAP earnings of $3.82 per share and adjusted operating earnings of $2.74 per share, surpassing expectations and prompting an upward revision of their full-year guidance to $8.00 to $8.40 per share.
This adjustment reflects a midpoint increase of $0.60 from the upper end of their original forecast.

Dominion Energy: Expansion of Data Centers in Virginia to Solidify Foothold In the Burgeoning Sector!

Dominion Energy recently provided an update on its fourth quarter 2024 earnings, revealing a nuanced financial and operational picture.
The company reported operating earnings of $2.77 per share for the year, situating within the higher end of its guidance, despite adverse weather conditions.
GAAP earnings stood at $2.44 per share, contrasting with $0.58 for the fourth quarter operating earnings.

AES Corporation: Renewable Energy Growth & Investment Progress Driving Our Optimism!

The AES Corporation’s recent earnings addressed both achievements and challenges faced during 2024, alongside their strategic outlook for 2025 and beyond.
The company reported a mixed performance for 2024, achieving an adjusted EBITDA of $2.64 billion, falling on the lower end of their guidance, primarily due to extreme weather events impacting their operations in Colombia and Brazil.
Despite these setbacks, AES recorded a parent free cash flow of $1.1 billion, aligning with expectations, and a record adjusted EPS of $2.14, exceeding their guidance range.

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Mar 09

Daily Brief India: Gensol Engineering, Hindalco Industries, National Aluminium, Jai Corp Ltd and more

By Smartkarma Daily Briefs | Daily Briefs, India

In today’s briefing:

Gensol Engineering: Debt Woes, Management Assurances and Lingering Red Flags
Hindalco (HNDL IN): Several Positive Triggers
National Aluminium (NACL IN) New Capacities and Cheap Valuations to Drive Returns
Jai Corp Ltd Under CBI Investigation: Allegations of Fund Diversion and Money Laundering

Gensol Engineering: Debt Woes, Management Assurances and Lingering Red Flags

Gensol clarified that debt woes are because of short term liability mismatch which contradicts with Lender’s clarification
Promoter said they will buy from the open market and will also infuse money into company but their recent stake sale again contradicts.
2nd CFO Resignation within 6 months further raises alarm over governance issues.

Hindalco (HNDL IN): Several Positive Triggers

Play on rising aluminium demand. Aluminium demand has outpaced supply with strong Chinese demand.
Management has guided better margins at Novelis which faced a temporary drop in margins due to scrap shortages.
Hindalco’s Indian operations are fully integrated with captive bauxite, alumina and to certain extent for energy. Trades at a 20%+ discount to its historic PE multiples.

National Aluminium (NACL IN) New Capacities and Cheap Valuations to Drive Returns

NACL posted its best ever quarterly performance in 3QFY25, driven by a sharp spike in alumina prices. Alumina prices have since cooled off but remain elevated at above US$450/t
NACL is set to expand its alumina capacity by 33% over the next 12 months. This will help double its external alumina sales from 1mt to 2mt.
Trades at 25% discount to historic PE of 13x despite record earnings, healthy balance sheet and strong near-term volume growth driven by brownfield expansion.

Jai Corp Ltd Under CBI Investigation: Allegations of Fund Diversion and Money Laundering