Daily Briefs

• Midea Group Co Ltd A (000333 CH) priced its H Share at HK$54.80 to raise HK$31,014 million (US$4.0 billion) in gross proceeds. The H Share will be listed tomorrow.
• The H Share listing price implies an AH discount of 21.4% at the A Share price of RMB63.51. This compares to Haier Smart Home (6690 HK)‘s AH discount of 13.8%.
• Futu grey market data shows that the H Shares closed 5.1% higher at HK$57.60. Our valuation analysis suggests that the H Share listing price is attractive.

• On 13 September, the Ministry of Finance of Japan added 7&I to a list of “core” designated companies based on results of voluntary inquiries to all listed companies.
• Several media reports suggest that the change in 7&I’s designation to core would complicate the proposed acquisition by Alimentation Couche-Tard (ATD CN). The core designation will not change Couche-Tard’s strategy.
• The change to 7&I’s designation to core will paradoxically push Couche-Tard to firm up its revised offer. An undemanding valuation protects the downside of a no-deal situation.

• Midea Group Co Ltd A (000333 CH) raised around US$4.6bn in its H-share listing (including over-allocation), after the deal was upsized.
• Midea Group is one of the world’s largest home appliance manufacturing companies with a presence in over 200 countries. Its A-shares have been listed since 2013.
• We have covered the deal background in our previous notes. In this note, we talk about the trading dynamics.

• P N Gadgil Jewellers (1742652D IN) raised around US$130m in its India IPO. 
• It is an Indian organized jewellery player with product offerings which include traditional as well as modern and functional jewellery designs, in gold, diamond, silver and platinum.
• In our previous notes, we looked at the company’s past performance and valuation. In this note, we talk about trading dynamics.

• Hong Kong Conglomerate Sector is showing renewed strength with Materials and Energy under pressure.  HK market 30 day volatility at 5 year low as market continues to de-risk.
• Hengan International Group (1044 HK) chart broke down from its Descending Triangle pattern after reporting its 1H24 results. J&T Global Express (1519 HK) broke down from its double bottom pattern.
• China Galaxy Securities (H) (6881 HK) price relative to the MSCI China index broke to a new high.  The company reported good results in a difficult environment for China brokers.

• Geopolitical risks are resurfacing in grain and oilseed markets
• Weather-related risks are impacting agricultural markets, particularly in the US and South America
• US grain export demand is strong, but dry conditions may lower yield potential and delay planting in South America, causing prices to rise

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• The sales volume growth rate began to accelerate in August.
• Geely’s revenue grew strongly by 39% YoY in 2Q24 and 47% YoY in 1H24.
• The operating margin had improved YoY for the past one year and a half.

• Innovation trends and patent filings within the food industry saw significant upswing over the year in the areas of natural ingredients and methods to manufacture vegan proteins.
• Ingredion Ingredion Inc (INGR US) has a leadership position in  the fast growing Clean Label, Sugar Reduction and Plant-Based Protein Technologies
• On a relative basis the stock despite better profitability metrics trades at a discount to the country-sector median and on an absolute basis at about 20% discount to FV.

• Singular Genomics Systems, Inc. stands at an interesting crossroads with the recent acquisition interest shown by Deerfield Management.
• Known for its innovative approach in genomics, specifically its G4® Sequencing Platform and the upcoming G4X™ Spatial Sequencer, Singular Genomics has garnered attention in the competitive genomics space.
• Despite its modest financial performance, with only $0.7 million in Q2 revenue and a negative gross profit, its cutting-edge technology and increasing customer interest make it a potentially valuable asset.

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.

• Meituan
• Samvardhana Motherson International Ltd