Category

Daily Briefs

Oct 24
0

Daily Brief ESG: Shui On Land – ESG Report – Lucror Analytics and more

By | Daily Briefs, ESG

In today’s briefing:

  • Shui On Land – ESG Report – Lucror Analytics
  • If Equity Compensation Are Introduced for Employees as Is, the Gender Gap in Compensation Widens

Shui On Land – ESG Report – Lucror Analytics

By Leonard Law, CFA

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
We assess Shui On Land’s ESG as “Adequate”, in line with its Environmental, Social and Governance scores. Controversies are “Immaterial” and Disclosure is “Strong”.

If Equity Compensation Are Introduced for Employees as Is, the Gender Gap in Compensation Widens

By Aki Matsumoto

  • Unlike the transfer of personnel rights, which is resisted by management, equity compensation that can be used to retain talent is attractive to management and is likely to accelerate.
  • If equity compensation plans are introduced for employees with a low ratio of female managers, the gap in compensation between men and women is expected to widen.
  • The introduction of equity compensation for employees is anticipated to provide an opportunity for management “kaizen” tips to emerge from individual workplaces.

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Oct 24
0

Daily Brief Thematic (Sector/Industry): Ohayo Japan | Day 3 of Losses and more

By | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

  • Ohayo Japan | Day 3 of Losses
  • Japan Morning Connection: Tesla Big Beat and SK Hynix Numbers to Buoy Sentiment
  • # 67 India Insight: Reliance Infra in Defence, Bharti Airtel CCI Nod, Naveen Jindal Cement Expansion

Ohayo Japan | Day 3 of Losses

By Mark Chadwick

  • Stocks dropped sharply on Wednesday, with the Dow Jones Industrial Average experiencing its worst day in over a month
  • All three major indexes logged their third consecutive day of losses on soaring Treasury yields, with the 10-year yield hitting 4.25%
  • Lam Research (LRCX US)  shares rose nearly 4% after hours following better-than-expected Q1 earnings and revenue.

Japan Morning Connection: Tesla Big Beat and SK Hynix Numbers to Buoy Sentiment

By Andrew Jackson

  • Apple down hitting suppliers, with ARM and Qualcomm spat taking both lower. Watch Softbank for weakness.
  • Tesla earnings smashing it out of the park, will help buoy EV related including Nidec – whose own numbers yesterday were positive.
  • Texas Instruments +4% on numbers beat should help industrial elec names such as Rohm and Fuji Elec, despite lingering concerns.

# 67 India Insight: Reliance Infra in Defence, Bharti Airtel CCI Nod, Naveen Jindal Cement Expansion

By Sudarshan Bhandari

  • Naveen Jindal Group to Invest INR 2,160 Crore in Cement Expansion
  • Bharti Airtel Secures CCI Nod to Raise Stake in Indus Towers
  • Reliance Infrastructure to Invest INR 10,000 Crore in Defence Manufacturing

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Oct 24
0

Daily Brief Event-Driven: Surging Buzz Around the Potential Split of Samsung Electronics and more

By | Daily Briefs, Event-Driven

In today’s briefing:

  • Surging Buzz Around the Potential Split of Samsung Electronics
  • Tokyo Metro (9023 JP): One Miss; A Bigger Index Inclusion Coming?
  • India: Potential Free Float Changes & Passive Flows in November
  • Auswide Bank (ABA AU)/ MyState (MYS AU) Merger: A Done Deal
  • Quiddity Leaderboard F100/F250 Dec 24: Thoughts Deliveroo and Coca-Cola; More Intra-Review Changes

Surging Buzz Around the Potential Split of Samsung Electronics

By Sanghyun Park

  • We’re starting to see some local market players getting ready and setting up trades that bet on a potential split for Samsung Electronics.
  • Samsung could leverage the buzz around spinning off its foundry business to split key units—foundry, memory chips, and others—into two or three separate companies at the shareholder meeting.
  • Additionally, the valuation gap between Samsung Electronics and Biologics has narrowed more than it has in the last decade, making it an even more attractive opportunity.

Tokyo Metro (9023 JP): One Miss; A Bigger Index Inclusion Coming?

By Brian Freitas

  • Tokyo Metro (9023 JP) had a blockbuster listing yesterday, finishing the day 45% higher. That took the estimated div yield down from 3.33% (at the IPO price) to 2.3%.
  • One expected index inclusion will not take place due to insufficient information on IPO allocations and that leads to a much lower free float than expected.
  • That inclusion will now be deferred to June; BUT there could be two other (bigger) index inclusions on the cards prior to that.

India: Potential Free Float Changes & Passive Flows in November

By Brian Freitas

  • Companies in India have disclosed their shareholding pattern as of end-September in October. There are companies with significant float changes from end-March and/or end-June.
  • The changes in free float could be reflected in domestic and global indices over the next few weeks and months resulting in action from passive trackers.
  • Depending on the date that the shareholding was published, there could be 11 stocks with passive inflows from global trackers while 6 could see passive outflows in November.

Auswide Bank (ABA AU)/ MyState (MYS AU) Merger: A Done Deal

By Arun George

  • The Auswide Bank (ABA AU) IE has considered Mystate Ltd (MYS AU)’s all-scrip merger offer in the best interests of the Auswide shareholders. However, the opinion comes with caveats.  
  • The offer is conditional on Auswide shareholder and regulatory approvals (ACCC, Treasury). The scheme meeting is on 2 December.
  • Vote risk is low due to the lack of substantial shareholders and the disinterested retail base. At the last close and for 18 December payment, the gross/annualised spread was 1.6%/10.3%.  

Quiddity Leaderboard F100/F250 Dec 24: Thoughts Deliveroo and Coca-Cola; More Intra-Review Changes

By Janaghan Jeyakumar, CFA

  • In this insight, we take a look at the potential ADDs and DELs for the F100 and F250 indices during the December 2024 index rebal event.
  • Separately, we see multiple M&A-related intra-review changes in the next few months.
  • There could also be more regular changes during the December 2024 rebalanced event

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Oct 24
0

Daily Brief ECM: Korea Zinc: Remaining Free Float Post Tender and a Margin Call for Choi on Young Poong Precision? and more

By | Daily Briefs, ECM

In today’s briefing:

  • Korea Zinc: Remaining Free Float Post Tender and a Margin Call for Choi on Young Poong Precision?
  • Afcons Infrastructure IPO – Decent Upside from the Price Range
  • Pony AI Pre-IPO – The Positives – Scaling up Robotaxi & Robotrucks
  • Horizon Robotics IPO Trading – More than 55% of the Deal Taken up by Existing Shareholders
  • Rigaku Holdings (268A JP) IPO: Trading Debut
  • Swiggy IPO: Zomato’s USD 1bn Fundraise Signals Looming Quick Commerce Challenges
  • Orum Therapeutics IPO Valuation Analysis
  • Pony AI IPO Preview: Small Scale and Early Stage Development. Is Exponential Growth Ahead?
  • Pre-IPO Beijing Biostar Pharmaceuticals (PHIP Updates) – Some Points Worth the Attention

Korea Zinc: Remaining Free Float Post Tender and a Margin Call for Choi on Young Poong Precision?

By Douglas Kim

  • According to Korea Zinc, it plans to disclose the treasury shares tender offer results on 28 October.
  • We discuss the remaining free float after the tender offer and the probabilities of share price decline or even a share price squeeze post announcement of the tender offer results.
  • All in all, this M&A fight for Korea Zinc remains tight with a slight advantage to MBK/Young Poong alliance.

Afcons Infrastructure IPO – Decent Upside from the Price Range

By Clarence Chu

  • Afcons Infrastructure Limited (6595396Z IN) is looking to raise around US$650m in its India IPO.
  • Afcons Infrastructure Limited (Afcons) is the flagship infrastructure engineering and construction company of the Shapoorji Pallonji group.
  • In a previous note, we looked at the firm’s past performance. In this note, we look at the updates since, and discuss valuation.

Pony AI Pre-IPO – The Positives – Scaling up Robotaxi & Robotrucks

By Sumeet Singh

  • Pony AI (PONY US)  an autonomous mobility solutions provider, is looking to raise up to US$300m in its US IPO. 
  • As per Frost & Sullivan, Pony AI was among the first companies in China to obtain licenses to operate fully driverless robotaxis in all four Tier-1 cities in China.
  • In this note, we talk about the positive aspects of the deal.

Horizon Robotics IPO Trading – More than 55% of the Deal Taken up by Existing Shareholders

By Sumeet Singh

  • Horizon Robotics (9660 HK) raised around US$800m, including over-allocation, in its Hong Kong IPO. 
  • Horizon Robotics (HR) is a provider of advanced driver assistance systems (ADAS) and autonomous driving (AD) solutions for passenger vehicles, empowered by its proprietary software and hardware technologies.
  • We have looked at the company’s past performance and valuations in our previous notes. In this note, we will talk about the trading updates.

Rigaku Holdings (268A JP) IPO: Trading Debut

By Arun George

Swiggy IPO: Zomato’s USD 1bn Fundraise Signals Looming Quick Commerce Challenges

By Devi Subhakesan

  • Zomato (ZOMATO IN) ‘s proposed USD 1 billion fundraise highlights several potential risks for Quick Commerce players, including Swiggy (1255298D IN) .
  • Beyond heightened competition, majority foreign-owned Quick Commerce businesses including Swiggy could face regulatory hurdles if classified as multi-brand retail, limiting their foreign ownership.
  • Investors may fear about Swiggy’s regulatory risks and profitability struggles in this competitive landscape, which could dampen investor enthusiasm and IPO valuation.

Orum Therapeutics IPO Valuation Analysis

By Douglas Kim

  • Our base case target price for Orum Therapeutics is 35,170 won per share, which is within the IPO price range of 30,000 won to 36,000 won per share. 
  • Given the lack of upside relative to the target price, we have a Negative View of this IPO. 
  • FSS has requested correction to the company’s IPO prospectus. As a result, it now appears the IPO could be delayed. 

Pony AI IPO Preview: Small Scale and Early Stage Development. Is Exponential Growth Ahead?

By Andrei Zakharov

  • Pony AI, a founder-led global autonomous driving company, filed for an IPO in the United States and may raise up to $300M on the Nasdaq exchange.  
  • The technology company operates fully driverless robotaxis (L4) in Beijing, Shanghai, Guangzhou and Shenzhen, Mainland China.
  • Pony AI has raised ~$1.4B in equity financing from top-tier investors, including Toyota Motor, HongShan, IDG Capital, 5Y Capital, ClearVue Partners, and Eight Roads Ventures, among others.

Pre-IPO Beijing Biostar Pharmaceuticals (PHIP Updates) – Some Points Worth the Attention

By Xinyao (Criss) Wang

  • Biostar’s revenue growth decreased obviously in the first five months in 2024. Under the fierce competition and anti-corruption campaign, the expectation for the commercialization performance of Biostar is not high.
  • Although Biostar has invested a lot of resources in market exposure, high customer concentration indicates that the Company faces challenges in marketing/customer relationship expansion. Biostar has also encountered overcapacity issues.
  • After Series E Financing, Biostar’s post-investment valuation was RMB4.49 billion. But we’re not optimistic about the outlook of Biostar. This valuation could be difficult to achieve in HK stock market.

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Oct 24
0

Daily Brief Credit: Morning Views Asia: Adani Green Energy and more

By | Credit, Daily Briefs

In today’s briefing:

  • Morning Views Asia: Adani Green Energy

Morning Views Asia: Adani Green Energy

By Leonard Law, CFA

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.

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Oct 24
0

Daily Brief Equity Bottom-Up: Nidec (6594)| Q2 In-Line; Long-Term Outlook Intact and more

By | Daily Briefs, Equity Bottom-Up

In today’s briefing:

  • Nidec (6594)| Q2 In-Line; Long-Term Outlook Intact
  • Texas Instrument: Small Beat in 3Q24, Uninspiring 4Q Guidance, the Stock Is Very Expensive.
  • Tech Supply Chain Tracker (24-Oct-2024): 2025+ global smartphone forecast.
  • Emerging Market Exchanges – Attractive Valuations with Defensive Qualities
  • Multi Bintang (MLBI IJ): Massive Inflection in Q3 FY24 with Double Digit Growth !!
  • SITC International (1308 HK): Unbeatable
  • Goldwin: 50% Growth in 5 Years? Possible but Some Challenges
  • Samsung Biologics (207940 KS): 3Q Result Beat Expectation; Guidance Raise Amid Increasing Order Book
  • JAKK: 3Q Preview: More than Holiday Movie Winners; Reiterate Buy, $30 PT
  • EDG: Gaps Begin to be Filled & Drilling Accelerates with 2nd Rig

Nidec (6594)| Q2 In-Line; Long-Term Outlook Intact

By Mark Chadwick

  • Nidec’s Q2 operating income beat my estimates, driven by strong small motors and appliance segments, though automotive profits underperformed
  • The automotive division is shifting focus from e-axles to broader auto parts, while improving operational efficiency through partnerships and streamlined logistics
  • Despite macro risks, Nidec remains well-positioned for long-term growth in digitalization, decarbonization, and automation, with a price target of ¥4,350

Texas Instrument: Small Beat in 3Q24, Uninspiring 4Q Guidance, the Stock Is Very Expensive.

By Nicolas Baratte

  • TXN reported 3Q24 last night: EPS 7% above Consensus, small beat. However, 4Q guidance shows a delayed / tepid recovery: revenue to decline -6% YoY, EPS to decline -21% YoY.
  • Industrial demand is still declining steeply -23% YoY, “hovering at the bottom”. Auto revenue -2% YoY with growth in China but rest of world is declining. 
  • The stock is trading at 31x 2025 and 25x 2026 Consensus EPS, way above its valuations range.

Tech Supply Chain Tracker (24-Oct-2024): 2025+ global smartphone forecast.

By Tech Supply Chain Tracker

  • Global smartphone shipments expected to increase beyond 2025, with OLED technology gaining popularity in tablets and notebooks while Mini LED becomes less preferred.
  • Uncertainty over whether Trump will end TSMC’s subsidies for Arizona factory, impacting material suppliers benefiting from TSMC’s growth in 3Q24.
  • PSMC chairman shifts from cautious approach towards India to optimism with new partnership with Tata, while Horizon Robotics’ Hong Kong IPO supported by Alibaba, Baidu, and TSMC for manufacturing.

Emerging Market Exchanges – Attractive Valuations with Defensive Qualities

By Victor Galliano

  • Our core pick is Brazilian exchange B3; this is a contrarian call, given its poor share price performance year to date, but it is attractively priced versus its peers
  • B3’s share of post-trade revenue is understated, and it is a well-diversified exchange in terms of the product offering, which includes cash equities, equity derivatives, FX, interest rates and commodities
  • We also like Hong Kong Exchange, with its high share of post-trade revenues; HKEx should benefit from improving investor sentiment towards China, boosted by the Chinese government’s recent economic stimulus

Multi Bintang (MLBI IJ): Massive Inflection in Q3 FY24 with Double Digit Growth !!

By Sameer Taneja

  • Multi Bintang Indonesia (MLBI IJ) experienced a massive inflection in its revenue with 21.9%/35% revenue/net profit growth as we approach the Q4 high season. 
  • Earlier, parent Heineken NV (HEIA NA)  had flagged in its H1 2024 report that Indonesia was experiencing double-digit growth following excise duties implemented in January 2024.
  • Trading at 11.5x FY24/net cash with >8% dividend yield and historical ROCEs averaging over 80%, we see a turning point in the share price now. 

SITC International (1308 HK): Unbeatable

By Osbert Tang, CFA

  • Together with the just-announced HK$0.40 special DPS, SITC International (1308 HK) has already handed back HK$1.12/share to shareholders YTD, realising a dividend yield of 6.5%.
  • Its 3Q24 performance is impressive, with revenue surging 56.6% YoY. Both volume (+13.4%) and average freight rates (+44.1%) have exhibited solid momentum. 
  • While the consensus forecasts have been upgraded by 7-11% since the 1H24 result, there appears more room to go. FY24 ROE is now expected to be 32.2%.

Goldwin: 50% Growth in 5 Years? Possible but Some Challenges

By Michael Causton

  • Goldwin has big plans for both The North Face in the Japanese and Korean markets and for its own brand globally.
  • But there are worries about saturation for the former in Japan, slowing brand development, and lack of expertise in overseas markets to build its own brand.
  • Goldwin has had an amazing run but can it build a global brand? If it can, it will feed into high levels of demand for Japan-tech sports brands.

Samsung Biologics (207940 KS): 3Q Result Beat Expectation; Guidance Raise Amid Increasing Order Book

By Tina Banerjee

  • In 3Q24, Samsung Biologics (207940 KS) reported 15% YoY revenue growth to KRW1,187B, driven by the contribution of Plant 4, the full utilization of Plants 1–3, and biosimilar products.
  • The company has raised 2024 annual revenue growth guidance to 15–20% YoY from 10–15% earlier, driven by successful ramp-up of Plant 4 and favorable Fx movement.
  • The company has signed record-breaking CMO contract with an Asian pharmaceutical company, thereby bringing the company’s total new contract value for the year to more than $3.3B.

JAKK: 3Q Preview: More than Holiday Movie Winners; Reiterate Buy, $30 PT

By Small Cap Consumer Research

  • We are reiterating our Buy rating, $30 price target and projections for JAKKS Pacific with the company announcing 3Q24 (September) results after the close on Wednesday.
  • We remain confident in our inline projections for the quarter, and believe the company, with a strong, somewhat lower-risk Holiday movie lineup in 2024, the beginning of the ramp of the Authentic Brands and The Simpsons license expansions, and the potential upside for Dog Man and the company’s own Wild Manes line launch, is well positioned to drive top and bottom line upside into 2025.
  • As such, we reiterate our Buy rating and $30 price target for JAKK.

EDG: Gaps Begin to be Filled & Drilling Accelerates with 2nd Rig

By Atrium Research

  • What you need to know: • EDG announced assay results for four drill holes as part of its 10,000m 2024 drill program; it has completed 22 holes (6,100m) to date.
  • • Today’s results confirmed strong mineralization in large untested gaps between Eagle & Imperial, also confirming mineralization at depth.
  • • A 2nd drill rig has been added to accelerate the drill program – this rig will test the near-surface portion of the Eagle Zone.

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Oct 24
0

Daily Brief Crypto: Digital Asset Primer: Part 2 – Foundations and more

By | Crypto, Daily Briefs

In today’s briefing:

  • Digital Asset Primer: Part 2 – Foundations, Companies, and Tokens: Strategic Insights for Investors

Digital Asset Primer: Part 2 – Foundations, Companies, and Tokens: Strategic Insights for Investors

By Christopher Rosa

  • Blockchain technology provides decentralized, transparent, and immutable digital ledgers, revolutionizing how transactions and data are managed without reliance on centralized authorities or intermediaries.
  • Tokens enable participation in blockchain ecosystems by providing access to services, governance rights, or value transfers, playing a key role in incentivizing user engagement and network growth.
  • Foundations and companies shape the development of blockchain projects, issuing tokens to fund innovation, promote decentralization, and drive community-driven governance, supporting the evolution of Web3 technologies.

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Oct 24
0

Daily Brief Macro: Malaysia Economics – Is 2025 Budget’s Gradualism Good Enough? and more

By | Daily Briefs, Macro

In today’s briefing:

  • Malaysia Economics – Is 2025 Budget’s Gradualism Good Enough?
  • China Big Corporate Debt Deleveraging
  • [IO Technicals Weekly 2024/42] Iron Ore Price Reversal Continues
  • Fenix Resources (FEX AU): Small Cap Iron Ore Miner With Great Upside
  • Actinver Research – Macro Daily: Inflation 1h-Oct (Estimate)

Malaysia Economics – Is 2025 Budget’s Gradualism Good Enough?

By Manu Bhaskaran

  • Malaysia’s budget saw the government continue to make minor tweaks to tax and spending, even as the data show that fiscal consolidation is slowing down. 
  • The proposed tax-raising measures are too narrowly targeted, limiting their scope to expanding the tax base and raising substantial revenues. 
  • Without more decisive action, the government risks missing its deficit and debt targets, which it set under the Medium-Term Fiscal Framework. 

China Big Corporate Debt Deleveraging

By Alex Ng

  • Private companies ex property developers have seen a small pay down of debt, but the largest remaining portion of non-financial debt ex LGFV is central and local SOE’s. 
  • They have low profitability and have shown few signs of increased leverage.  This leaves the onus on fiscal policy.  
  • Reports suggests that the LGFV debt swap for local and central government bonds could be Yuan6trn through end 2027, but what is happening to other non-property developer corporate debt?

[IO Technicals Weekly 2024/42] Iron Ore Price Reversal Continues

By Pranay Yadav

  • SGX IO Futures fell for the second consecutive week, closing USD 4.15/ton lower at USD 101.70/ton on 18/Oct, with a trading range of USD 9.75/ton.
  • Short-Term moving averages signaled a bearish reversal, with a downward 9-day moving average and failure to break above key pivot points.
  • Heavy selling pressure and expanded China stimulus measures disappointed market expectations, signaling continued bearish trends with a potential test of USD 97.5/ton support.

Fenix Resources (FEX AU): Small Cap Iron Ore Miner With Great Upside

By Sameer Taneja

  • Fenix Resources (FEX AU) is a small-cap iron ore miner/logistics provider with massive upside based on an increasing sales profile from 1.3 to 4 million tons over FY25/26. 
  • The company is also positioning itself as a logistics provider with the potential to transport 10 million tons of material through the Geraldton Port with its infrastructure in place. 
  • Trading at 5.4x FY25e PE with a 1.8 EV-EBITDA, >38% of the market cap in cash, this is a stock worth exploring.

Actinver Research – Macro Daily: Inflation 1h-Oct (Estimate)

By Actinver

  • As agricultural prices have completed their correction, we do not expect more downward surprises in inflation.
  • Meanwhile, we estimate energy prices to rise this fortnight because of the withdrawal of summer electricity subsidies.
  • As a result, we estimate headline inflation at 0.41% bw, consistent with its historical average.

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Oct 24
0

Daily Brief Australia: Auswide Bank, Iron Ore and more

By | Australia, Daily Briefs

In today’s briefing:

  • Auswide Bank (ABA AU)/ MyState (MYS AU) Merger: A Done Deal
  • [IO Technicals Weekly 2024/42] Iron Ore Price Reversal Continues
  • Fenix Resources (FEX AU): Small Cap Iron Ore Miner With Great Upside

Auswide Bank (ABA AU)/ MyState (MYS AU) Merger: A Done Deal

By Arun George

  • The Auswide Bank (ABA AU) IE has considered Mystate Ltd (MYS AU)’s all-scrip merger offer in the best interests of the Auswide shareholders. However, the opinion comes with caveats.  
  • The offer is conditional on Auswide shareholder and regulatory approvals (ACCC, Treasury). The scheme meeting is on 2 December.
  • Vote risk is low due to the lack of substantial shareholders and the disinterested retail base. At the last close and for 18 December payment, the gross/annualised spread was 1.6%/10.3%.  

[IO Technicals Weekly 2024/42] Iron Ore Price Reversal Continues

By Pranay Yadav

  • SGX IO Futures fell for the second consecutive week, closing USD 4.15/ton lower at USD 101.70/ton on 18/Oct, with a trading range of USD 9.75/ton.
  • Short-Term moving averages signaled a bearish reversal, with a downward 9-day moving average and failure to break above key pivot points.
  • Heavy selling pressure and expanded China stimulus measures disappointed market expectations, signaling continued bearish trends with a potential test of USD 97.5/ton support.

Fenix Resources (FEX AU): Small Cap Iron Ore Miner With Great Upside

By Sameer Taneja

  • Fenix Resources (FEX AU) is a small-cap iron ore miner/logistics provider with massive upside based on an increasing sales profile from 1.3 to 4 million tons over FY25/26. 
  • The company is also positioning itself as a logistics provider with the potential to transport 10 million tons of material through the Geraldton Port with its infrastructure in place. 
  • Trading at 5.4x FY25e PE with a 1.8 EV-EBITDA, >38% of the market cap in cash, this is a stock worth exploring.

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Oct 24
0

Daily Brief South Korea: Samsung Electronics, Korea Zinc, Orum Therapeutics, Samsung Biologics and more

By | Daily Briefs, South Korea

In today’s briefing:

  • Surging Buzz Around the Potential Split of Samsung Electronics
  • Korea Zinc: Remaining Free Float Post Tender and a Margin Call for Choi on Young Poong Precision?
  • Orum Therapeutics IPO Valuation Analysis
  • Samsung Biologics (207940 KS): 3Q Result Beat Expectation; Guidance Raise Amid Increasing Order Book

Surging Buzz Around the Potential Split of Samsung Electronics

By Sanghyun Park

  • We’re starting to see some local market players getting ready and setting up trades that bet on a potential split for Samsung Electronics.
  • Samsung could leverage the buzz around spinning off its foundry business to split key units—foundry, memory chips, and others—into two or three separate companies at the shareholder meeting.
  • Additionally, the valuation gap between Samsung Electronics and Biologics has narrowed more than it has in the last decade, making it an even more attractive opportunity.

Korea Zinc: Remaining Free Float Post Tender and a Margin Call for Choi on Young Poong Precision?

By Douglas Kim

  • According to Korea Zinc, it plans to disclose the treasury shares tender offer results on 28 October.
  • We discuss the remaining free float after the tender offer and the probabilities of share price decline or even a share price squeeze post announcement of the tender offer results.
  • All in all, this M&A fight for Korea Zinc remains tight with a slight advantage to MBK/Young Poong alliance.

Orum Therapeutics IPO Valuation Analysis

By Douglas Kim

  • Our base case target price for Orum Therapeutics is 35,170 won per share, which is within the IPO price range of 30,000 won to 36,000 won per share. 
  • Given the lack of upside relative to the target price, we have a Negative View of this IPO. 
  • FSS has requested correction to the company’s IPO prospectus. As a result, it now appears the IPO could be delayed. 

Samsung Biologics (207940 KS): 3Q Result Beat Expectation; Guidance Raise Amid Increasing Order Book

By Tina Banerjee

  • In 3Q24, Samsung Biologics (207940 KS) reported 15% YoY revenue growth to KRW1,187B, driven by the contribution of Plant 4, the full utilization of Plants 1–3, and biosimilar products.
  • The company has raised 2024 annual revenue growth guidance to 15–20% YoY from 10–15% earlier, driven by successful ramp-up of Plant 4 and favorable Fx movement.
  • The company has signed record-breaking CMO contract with an Asian pharmaceutical company, thereby bringing the company’s total new contract value for the year to more than $3.3B.

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