Thematic (Sector/Industry)

OVERSEAS. US Equities take a breather as earnings intensify; WSJ saying Markets face threat from weak earnings; China ask banks to delay buying USD; Eurozone employment hits all-time low
JAPAN. Nikkei Futures -0.9% vs Cash; USDJPY 143.3; Earnings in full swing as a massive beat from Toyota – China doesn’t matter; MegaBanks MUFG, Mizuho Beat
NUGGET. Push and pull factors are joining to push the massive Japanese household savings into the equity market. Its all coming together – watch out above !

Southeast Asia Plantations: Where Things Stand with the Weather, Still Bullish

By Niklas Olausson

The El Nino is progressing, albeit slowly, in a volatile fashion. There is no significant impact yet on Southeast Asia’s oil palm areas although YTD, rainfall is already lower YoY.
For edible oils, heat waves and drought continue to underpin elevated yield risks, with current focus on soybeans (U.S. and China), rapeseed (Canada) and olive oil (the Mediterranean.)
The Plantation sector and CPO price have gained some traction, but it is early days. Maintain a bullish stance. Report contains new data on earnings mixes, maturity profiles and yields.

[Blue Lotus Multi-Platform Sector Update]: ByteDance Forecasts and Implications for China Internet

We updated our revenue forecasts for ByteDance (China domestic) , with the industry models. We estimate that ByteDance’s domestic ad revenue/eCommerce GMV/local lifestyle GTV will grow by 17%/50%/134% this year.
In the advertising space, we recommend Tencent and iQIYI. Both Tencent and iQIYI experienced a decline in their advertising revenue market share in 2022, followed by a rebound in 2023.
In transactional GMV/GTV, we prefer Meituan and Pinduoduo. Meituan’s market share experienced a significant decline in 2022, but the decline rate is expected to narrow significantly this year.

China TMT Update-BEKE/2150.HK/LI/NIO/XPEV-Supportive Policy on Home Purchase;August Vehicle Delivery

Real Estate Industry Update: Housing bureaus in China’s first tier cities pledge to draft supportive policy on home purchase（+）
2150HK: Nayuki teahouse average store revenue remains flattish YoY in July 2023（/）
LI/NIO/XPEV: Li Auto, NIO and Xpeng update August vehicle delivery results (+/+//)

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Aug 01

Daily Brief Thematic (Sector/Industry): Ohayo Japan| Goldilocks in Play Everywhere; NUGGET: New Console? Can’t Keep a Super Mario Down! and more

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

In today’s briefing:

Ohayo Japan| Goldilocks in Play Everywhere; NUGGET: New Console? Can’t Keep a Super Mario Down!
Auto Semiconductor Earnings, Testing, Semicap
Trends in Casual Dining, Quick Service and Online Food Delivery
US Banks – Loan Growth Moving Lower With Rising Provisions, Not Great Combination
Anti-Corruption in China Healthcare – the Impact and the Outlook
China TMT Update-XPEV/3690HK/241HK/6618HK-Volkswagen Cooperation;Crackdown on Healthcare Corruption
The Highlights – Cannabis News for the Week Ending July 28, 2023

Ohayo Japan| Goldilocks in Play Everywhere; NUGGET: New Console? Can’t Keep a Super Mario Down!

OVERSEAS. US Equities close July a winning note as markets continue to price in the Goldilocks economy; Rally has broadened out beyond a few select tech stocks
JAPAN. NKY Futures +0.3% vs Cash; USDJPY 142.3; NKY powers above 33k level despite prospect of higher rates; Earnings in full swing – generally supportive; Nintendo-next Gen Console Coming ?
NUGGET. Nintendo(7974)- rumour of a Next Gen Console in 2024 is gaining traction. If true, would completely reboot the company’s earnings and share price outlook

Auto Semiconductor Earnings, Testing, Semicap

By Douglas O’Laughlin

A partial earnings recap of companies so far this week: grouped by categories
Simo and Maxlinear are going to be in a separate note.
It’s too funny and interesting not to, but that will hopefully come out soon. It’s been quite a week of content.

Trends in Casual Dining, Quick Service and Online Food Delivery

By Pranav Bhavsar

Barbeque Nation Hospitality (BARBEQUE IN) has a strong operating model, well-regarded management, and a good dining experience, resonating well with non-vegetarian and corporate customers.
Current consumer trends show increased spending in the restaurant business, driven by social pressure to showcase lifestyles on platforms like Instagram.
ONDC has potential as a platform but faces challenges in scaling up due to infrastructure and delivery integration issues.

US Banks – Loan Growth Moving Lower With Rising Provisions, Not Great Combination

High frequency data shows large US banks reporting loan growth at 2.5% YoY at 19 July week
This is far lower than where it was earlier this year at 8.2% YoY at 18 January week
Loan loss reserves for large banks are up ~18.3% YoY in each of the past 3 weeks

Anti-Corruption in China Healthcare – the Impact and the Outlook

By Xinyao (Criss) Wang

The anti-corruption campaign has significantly accelerated since the beginning of this year. After Central Commission for Discipline Inspection has been involved, the anti-corruption efforts in pharmaceutical/device sectors would be unprecedented.
The main targets are leaders of hospitals/governments. The impact of anti-corruption on companies is indirect. As long as senior management are not investigated/arrested, the impact on stock price isn’t significant.
However, investors not only need to consider the problem of sales growth slowing down in the context of anti-corruption, but also consider whether companies is engaging in financial fraud.

China TMT Update-XPEV/3690HK/241HK/6618HK-Volkswagen Cooperation;Crackdown on Healthcare Corruption

XPEV: Xpeng and Volkswagen cooperation updates, per the analyst call with IR team (/)
3690.HK: NDRC adds guidelines for restoring consumption of catering and tourism (+)
241HK/ 6618HK：Central Discipline Committee launched crackdown on healthcare corruption (-)

The Highlights – Cannabis News for the Week Ending July 28, 2023

By Water Tower Research

The Fed raised rates 0.25% at the July FOMC meeting on Wednesday, bringing the fed funds rate to 5.25% to 5.50%.
Stocks rallied, as investors sense the Fed may be nearing the end of its rate-hike cycle.
The S&P 500 gained 1.05%, while the MSCI World Index climbed 0.82%.

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Jul 31

Daily Brief Thematic (Sector/Industry): Ohayo Japan|Benign PCE Deflator Spurs Equities; BOJ Easing to Continue: Nidec+Renasas = A Big Deal and more

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

In today’s briefing:

Ohayo Japan|Benign PCE Deflator Spurs Equities; BOJ Easing to Continue: Nidec+Renasas = A Big Deal
[Blue Lotus Sector Update]: Investors Tolerate Amazon, Why Not China New Energy?
China TMT Update-BEKE/981.HK/1810.HK/AAPL-Ministry of Housing Loosen Home Purchase Restrictions
Interpretation of the New Adjustments in Medical Insurance (NRDL) Negotiation Rules and the Impact

Ohayo Japan|Benign PCE Deflator Spurs Equities; BOJ Easing to Continue: Nidec+Renasas = A Big Deal

OVERSEAS. PCE Deflator 3.0%YoY; 0.2%MoM calms (re)inflation fears; Yields fall, Equities rebound as Goldilocks View of Economy/Markets intact; SPX 2Q earnings not so bad; China further moves to bolster economy;
JAPAN. NKY Futures 1% vs Cash; USDJPY 141.2; BOJ Tweaks – 0.5% JGB10Y yield now a reference, not a ceiling; To buy bonds at 1%.; Next inflation forecast 1.9%=continued easing
NUGGET. Nidec-Renesas Partnership potentially a big deal for both companies. Successful execution will lead to sales and profit growth for both companies in their respective areas.

[Blue Lotus Sector Update]: Investors Tolerate Amazon, Why Not China New Energy?

The phenomenon of Chinese vendors taking terms to launch price wars, diminishing industry’s profitability is a headache.
We conclude the reason is China’s technology lead is so slim that price wars against each other is the only way to stay in the game;
Although renewable energy has long and expansive value chains, transportation is a separate node. China’s success in EV has strategic value for a wide range of industries.

China TMT Update-BEKE/981.HK/1810.HK/AAPL-Ministry of Housing Loosen Home Purchase Restrictions

Real Estate Industry Update: Beijing intends to give policy support to the purchase of green buildings（+）
Real Estate Industry Update: Ministry of Housing promised to lower housing down payment, and loosen home purchase restrictions（+）
981.HK/1810.HK/AAPL: Huawei to launch new 5G-enabled smartphones ( + / -)

Interpretation of the New Adjustments in Medical Insurance (NRDL) Negotiation Rules and the Impact

By Xinyao (Criss) Wang

Many investors may not understand China’s NRDL negotiation system and the new adjustments in July. So, we think it’s necessary to clarify the rules/key points of NRDL negotiation procedures.
NHSA provides clear calculation rules for price reduction, greatly increasing the predictability of price changes during renewal process in NRDL negotiation. However, the benefits brought by new adjustments are limited.
The main direct beneficiaries are those “old drugs” since their price reduction can be controlled in renewal process. For enterprises, the biggest obstacle is the first NRDL negotiation with NHSA.

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Jul 30

Daily Brief Thematic (Sector/Industry): GEMWeekly (28 Jul 2023): South Korea GDP; Alibaba and more

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

In today’s briefing:

GEMWeekly (28 Jul 2023): South Korea GDP; Alibaba, Samsung SDI, Tencent, TSMC, Ant, Meituan

GEMWeekly (28 Jul 2023): South Korea GDP; Alibaba, Samsung SDI, Tencent, TSMC, Ant, Meituan

By Wium Malan, CFA

The Global Emerging Markets Weekly provides a summary of the key news and related developments impacting the largest countries and constituents of the Global Emerging Markets equity indices.
Macro data points: South Korean GDP, export, and import growth.
Companies mentioned:Alibaba Group Holding (9988 HK), Samsung SDI (006400 KS), Tencent (700 HK), Taiwan Semiconductor (TSMC) (2330 TT), Ant Group (6688 HK), MeiraGTx Holdings plc (MGTX US)

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Jul 29

Daily Brief Thematic (Sector/Industry): Japan Weekly | Zeon and more

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

In today’s briefing:

Japan Weekly | Zeon, Disco, Topcon, CyberAgent, Omron
Resona & Chiba – Duration Longest at Resona, Shortest at Chiba, Implications for YCC Relief
India Gaming: Still Asia’s Sleeping Giant, Delta Corp Enjoys a Strong Moat
Volkswagen’s China Joint Venture to Develop Plug-In Hybrids for Local Market

Japan Weekly | Zeon, Disco, Topcon, CyberAgent, Omron

The Bank of Japan tweeked its yield curve control by raising the interest rate cap. JP bond yields had been moving higher in anticipation.
Japanese equities ended the week at 2,290 (+1.2% wow). Financial stocks were stronger
Earnings dominated the larger stock level moves this week. Contrarians may want to look at CyberAgent following earnings miss

Resona & Chiba – Duration Longest at Resona, Shortest at Chiba, Implications for YCC Relief

There is no easy way to gather duration data of securities held by Japan’s regional banks
In IR material of the largest 8 regional banks, Resona and Chiba stand out, at opposite ends
On blunt equity/assets SBI Sumishin Net Bank stands out at only 1.5%

India Gaming: Still Asia’s Sleeping Giant, Delta Corp Enjoys a Strong Moat

By Howard J Klein

We began coverage of India gaming five years ago on SK when it appeared a judicial panel was about to approve mass legalization. But that has stalled.
Delta Corp’s position in the State of Goa is a moat by any definitions.
Most recent earnings release show gains in revenues and profits/

Volkswagen’s China Joint Venture to Develop Plug-In Hybrids for Local Market

By Caixin Global

The joint venture (JV) between state-owned SAIC Motor Corp. Ltd. and Volkswagen AG will start developing its own plug-in hybrid models, a source familiar with the matter told Caixin, in a move insiders say shows that Chinese automaking is now leading innovation instead of simply emulating foreign manufacturers.
The effort by SAIC Volkswagen Automotive Co. Ltd. is its latest to appeal more to Chinese consumers with an interest in new-energy vehicles (NEVs), which have increasingly become a key growth driver for the world’s largest auto market.
Beijing aims to make almost all new cars sold in 2035 in the country eco-friendly amid its push to reduce carbon emissions.

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Jul 28

Daily Brief Thematic (Sector/Industry): Smartkarma Webinar | Disclosures and Governance in Indian Banks and more

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

In today’s briefing:

Smartkarma Webinar | Disclosures and Governance in Indian Banks
Ohayo Japan| AI Bid; Strong GDP->more Hikes? Stocks Drop; NUGGET: Steel Decarb-Advantage Tokyo Steel
China Lithium Futures Bounce Back From Debut Bloodbath

Smartkarma Webinar | Disclosures and Governance in Indian Banks

By Smartkarma Research

In the next installment of our Webinar Wednesdays, we go live with Smartkarma Insight Provider Hemindra Hazari
He will be sharing with us more about Disclosures and Governance in Indian Banks.
From current opportunities, to what we can expect next in the space, join us as we get the full picture from Hemindra.

The webinar will be hosted on Wednesday, 2 August 2023, 17:00 SGT/HKT.

Register for the Webinar here

Hemindra Hazari is a Securities & Exchange Board of India (SEBI) registered research analyst with over 25 years experience in the Indian capital markets with a specialization in banking and economy research and has managerial experience of establishing profitable equities business, leading and mentoring analysts. He has worked with prominent foreign and domestic capital market firms such as UBS, Societe Generale, HSBC, ASK Raymond James and Karvy Stock Broking and is a regular guest on business media channels and is respected for his non-consensus view on stocks and the market.

Ohayo Japan| AI Bid; Strong GDP->more Hikes? Stocks Drop; NUGGET: Steel Decarb-Advantage Tokyo Steel

OVERSEAS. SOX 1.9% bid as Generative AI drives bid for semis/tech hardware; Booming US Economy as GDP prints 2.4% driving yields higher; But USD weaker vs Yen on BOJ.
JAPAN. NKY Futures -1% vs Cash; USDJPY 139. 5; Really all about the BOJ as the Nikkei broke news on potential YCC tweak; Earnings deluge: -ve Shin-etsu; Fujitsu.
NUGGET. Tokyo Steel has more advantages than meets the eye. No need for the massive capex in the crucial process that Nippon Steel or JFE needs to put out. Bullish.

China Lithium Futures Bounce Back From Debut Bloodbath

By Caixin Global

China’s lithium futures clawed back some lost ground Tuesday after two straight days of declines in a brutal debut for the contracts, with the most-traded contract holding above the key psychological threshold of 200,000 yuan per ton ($28,010).
The lithium carbonate contract for January delivery on the Guangzhou Futures Exchange rebounded 6.9% from Monday to close at 225,900 yuan per ton, data from the bourse showed.
Futures for February to July delivery rose between 7.2% and 8.5% on Tuesday, closing between 191,350 yuan and 213,800 yuan per ton.

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Jul 27

Daily Brief Thematic (Sector/Industry): Ohayo Japan| Fed Watch: Now for Hawkish Hold; Advantest Miss; NUGGET: JP Executives Not Incentivized and more

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

In today’s briefing:

Ohayo Japan| Fed Watch: Now for Hawkish Hold; Advantest Miss; NUGGET: JP Executives Not Incentivized
Interpretation of China’s Politburo – The A-Share Bull Market Is Coming?
China A-Share Consumer Staples: The Most Challenging Time Is Behind
China TMT Update-ATAT/XPEV-The VW Brand Cooperate with Xpeng;G6 Capacity;Legacy-Huazhu 2Q23 RevPAR
SPAC TALK – SPACs and Publicly Traded Targets

Ohayo Japan| Fed Watch: Now for Hawkish Hold; Advantest Miss; NUGGET: JP Executives Not Incentivized

OVERSEAS. Fed Lifts rates +25bps as expected; No longer sees recession emerging; Equities – Mixed as Industrials Rally, Tech Sells off; Meta Beats on Rev/EPS; Boeing Surges on Outloook
JAPAN. Nikkei Futures -0.4% vs Cash; USDJPY 140.4; Fed Move Done, but for BOJ – Potential for a Surprise Move ? Advantest Miss-back to reality ? Earnings in Full Swing.
NUGGET. Japanese Executives Not Properly Incentivized; Shareholders need to take a different tact in addressing corporate performance.

Interpretation of China’s Politburo – The A-Share Bull Market Is Coming?

By Xinyao (Criss) Wang

On China’s Politburo, we did see some rare expressions and highlights worthy of attention. Perhaps, avoiding short-term risks is so important that China needs to temporarily put aside long-term transformation.
Attitude change doesn’t mean returning to old model.Since “expanding domestic demand” is placed in a prominent position, we have reason to be optimistic about the prospects of private economy/A-share market.
The real A-share bull market may not come immediately, but we are optimistic about the performance of A-shares in 23Q4 and 2024. We recommend investors to get prepared in advance.

China A-Share Consumer Staples: The Most Challenging Time Is Behind

By Osbert Tang, CFA

Performance of China A-share consumer staples stayed lacklustre in the last three months, underperforming benchmark indexes. Negative consumer sentiments have weighted on them.
The pullback in valuations, however, has made them look more appealing now. Excluding Foshan Haitian Flavouring & Food (603288 CH), there has been no earnings downgrades.
Both Shanxi Xinghuacun Fen Wine Factory Co (600809 CH) and Fu Jian Anjoy Foods Group (603345 CH) have pre-announced 1H23 results which showed good 2Q23 earnings.

China TMT Update-ATAT/XPEV-The VW Brand Cooperate with Xpeng;G6 Capacity;Legacy-Huazhu 2Q23 RevPAR

ATAT: Legacy-Huazhu 2Q23 RevPAR increased 21% vs. same period in 2019（+）
XPEV: weekly data indicates G6 capacity still needs time to ramp up (-)
XPEV : The VW brand concludes technological framework agreement for long-term cooperation with Xpeng (+)

SPAC TALK – SPACs and Publicly Traded Targets

By Water Tower Research

Dog days of summer. Just as the unbearable heatwave afflicting the US and other parts of the globe may have a slowing effect on activity, there has been a slowdown in SPAC merger deal activity.
Having just entered the last week of July, while the SPAC IPO market continues to trundle along (four priced in July), there has been a noticeable tamp down in merger deal flow.
Only five new SPAC IBC deals have been announced so far this month, with the average value per deal at $364M.

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Jul 26

Daily Brief Thematic (Sector/Industry): Ohayo Japan| US Consumer Confidence; China Resolve Fuels Stocks; NUGGET:IT Talent Issue – A Priority and more

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

In today’s briefing:

Ohayo Japan| US Consumer Confidence; China Resolve Fuels Stocks; NUGGET:IT Talent Issue – A Priority
ANZ/Suncorp – Another ACCC Deal Delay, Increasingly Seems Like It Will Not Get Approval
Credit Watch: The credit contraction has arrived… 5 charts from the ECB credit survey
[Blue Lotus Japanese E-Commerce Sector Update]: Facing the Competition from Chinese ECommerce STAT
Brazilian Value: The Trade of the Decade
Australian Banks – High Frequency Data Suggests Major Deterioration Not Yet Visible In Interims
China TMT Update-NIO/BEKE/LEGN-NIO to Offer Single-Motor Model;Political Bureau Shifted Tone

Ohayo Japan| US Consumer Confidence; China Resolve Fuels Stocks; NUGGET:IT Talent Issue – A Priority

OVERSEAS. US Stocks continue relentless run; Consumer Confidence hits 2 year high; New Resolve from China to help the economy; Alphabet reports strong earnings; MSFT AI biz growing
JAPAN. NKY Futures -0.3% Discount to Cash; USDJPY 140.9; Earnings in full swing: Otsuka HD beats; Shimano Misses; Broker Changes: Nintendo cut to Sell at UBS
NUGGET. Globally competitive wages – An National Security Issue. More evidence emerges: Now out of Vietnam

ANZ/Suncorp – Another ACCC Deal Delay, Increasingly Seems Like It Will Not Get Approval

ACCC issued a new letter asking ANZ for 2 more weeks, for its decision to takeover Suncorp
ACCC appears to be taking seriously the Stark Report which is very much against takeover
Specifically, the ACCC indicates it needs more time to review ANZ’s rebuttal to the report

Credit Watch: The credit contraction has arrived… 5 charts from the ECB credit survey

By Andreas Steno

Here is a list of our top charts from the Q3 ECB Credit Survey.
Just a few charts with a few words attached to them.
The credit contraction is already a reality in Europe, but there are also signs of green shoots in the survey.

[Blue Lotus Japanese E-Commerce Sector Update]: Facing the Competition from Chinese ECommerce STAT

We anticipate that the major swing factor of global e-commerce platform is the global expansion of Chinese e-commerce companies, including Shein, Temu, AliExpress, and TikTok Shop (or ‘STAT’).
The Japanese market is a good example. We upgraded Mercari to BUY because we believe that its second-hand eCommerce model addresses the issue of product supply.
We downgraded Z-Holdings to SELL as its B2C model lacks an advantage in product supply and has already lost market share.

Brazilian Value: The Trade of the Decade

By Superfluous Value

Value investing is often described as running towards the fire or seeking out disaster.
Often, outstanding returns can be had as the market reverts from total capitulation, to merely bad.
In the case of Brazil today, an investor is paying capitulation pricing for prospects that are already better than merely bad.

Australian Banks – High Frequency Data Suggests Major Deterioration Not Yet Visible In Interims

Bankruptcy data through May suggests that credit metrics are worsening dramatically
Australia’s banks report on an interim basis, providing only trading updates quarterly
There are very specific concerns with worsening credit metrics for Suncorp and ANZ

China TMT Update-NIO/BEKE/LEGN-NIO to Offer Single-Motor Model;Political Bureau Shifted Tone

NIO: NIO to offer single-motor model in sub-brand codenamed Alps (+)
BEKE: Political Bureau of the Central Committee shifted tone on real estate regulation（+）
LEGN: Janssen reported CARVYKTI sales US$117mn, lower than our expectation (-)

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Jul 25

Daily Brief Thematic (Sector/Industry): Ohayo Japan|SPX Up Again…On Peak Rates?; NUGGET: Tokyo Steel(5423) – Green Demand Steel a Reality! and more

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

In today’s briefing:

Ohayo Japan|SPX Up Again…On Peak Rates?; NUGGET: Tokyo Steel(5423) – Green Demand Steel a Reality!
China TMT Update-BABA/BGNE/9926HK/9995HK/1801HK/1877HK/LGNE/ZLAB/BEKE-Baba’s Annual Report/NHSA Rule
[Blue Lotus Heathcare Sector Update]: Domestic Substitution Takes Nascent Root in Med-Bots
The Highlights – Cannabis News for the Week Ending July 21, 2023

Ohayo Japan|SPX Up Again…On Peak Rates?; NUGGET: Tokyo Steel(5423) – Green Demand Steel a Reality!

OVERSEAS. S&P500 Up again, closing +0.4% ahead of Fed and a slew of earnings; Energy, Fincl lead on higher crude px, Higher UST ylds; Hopes fade for big China stimulus
JAPAN. NKY Fut +0.1% vs Cash; USDJPY 141.4; Hunt for real yields as JP retail bets on high ylding currencies; BOJ may lift inflation view; TSE ramps up pressure
NUGGET. Tokyo Steel (5423) – First Japan Beneficiary of the Shift to Low Carbon Steel.

China TMT Update-BABA/BGNE/9926HK/9995HK/1801HK/1877HK/LGNE/ZLAB/BEKE-Baba’s Annual Report/NHSA Rule

Baba: Alibaba’s annual report, Chinese media discussions and our thoughts
BGNE/9926HK/9995HK/1801HK/1877HK/LGNE/ZLAB: NHSA issued new rule to protect drug pricing (-)
BEKE: China reinforce the city village reconstruction policy, which is different with Shantytown Renovation project（+)

[Blue Lotus Heathcare Sector Update]: Domestic Substitution Takes Nascent Root in Med-Bots

We compiled the public sector bidding result of medical robots in the past one and half years.
Result shows market leaders reinforcing their shares in laparoscopic and orthopaedic robots but in neurosurgery a new challenger has risen
We reiterate the view domestic substitution will likely occur in areas like puncture, natural orifice and microsurgery, which will require new core competencies in machine vision, haptic feedback and AR/VR.

The Highlights – Cannabis News for the Week Ending July 21, 2023

By Water Tower Research

Global equities again inched higher this week with the S&P 500 +0.65% and the MSCI World Index +0.60%.
The S&P 500 is now within 6% of an all-time high as investors become increasingly confident that inflation has cooled while corporate earnings remain strong.
The Russell 2000 climbed 1.53% last week but remains 18% below its 2021 peak.

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Jul 24

Daily Brief Thematic (Sector/Industry): Japan Screen | A Treasure Trove of Value and more

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

In today’s briefing:

Japan Screen | A Treasure Trove of Value
Ohayo Japan | This Week: Fed Hike in the Bag, All Eyes on BOJ; NUGGET: Top 5 Reasons We Like Sony
Chinese Airlines: Taking off Again
Philippine Move to Goverment Run Online Gaming Site Poses Potential Problems for Live Operators
China TMT Update-PDD/BABA/CPNG/SE/BEKE/1211HK/TSLA/XPEV/LI/NIO-Temu Launches in South Korea
Weekly Stock Bullfinder – Week of 7/24

Japan Screen | A Treasure Trove of Value

Even with a strong Japanese equity market this year, there is still a treasure trove of ultra-low PBR stocks
With the TSE pressuring companies to lift their ROE and valuations, and increasing activist engagement, value stocks should continue to perform
From a universe of non-financial companies, with a market cap above ¥250 billion, we highlight some deeply undervalued opportunities – with better performance metrics

Ohayo Japan | This Week: Fed Hike in the Bag, All Eyes on BOJ; NUGGET: Top 5 Reasons We Like Sony

OVERSEAS. SPX managed to rise +0.7%WoW, despite the Tech weakness last week; Fed and ECB on tap as both to lift rates by +25bps; Twitter/Musk exile the Blue Bird logo
JAPAN. NKY Futures +1.2% vs Cash; USDJPY 141.7; The wild card this week is the BOJ- mounting speculation that there could be a tweak with Japan’s inflation above US.
NUGGET. Top 5 Reasons We Like Sony: Dream team Mgmt; PS5; Crunchyroll; Tax-free spin-off; Image Sensors

Chinese Airlines: Taking off Again

By Osbert Tang, CFA

The underperformance of Chinese airlines looks unjustified to us, especially in view of the significant narrow-down in losses in 2Q23, particularly for Air China Ltd (753 HK).
While domestic passenger capacity has fully recovered, international capacity is still more than 50% below Jun 2019. We anticipate its recovery will drive profitability over the next 12 months.
We prefer Air China Ltd (753 HK) given its excellent leverage to international routes and exposure to Cathay Pacific Airways (293 HK). Its FY24F ROE of 45% is impressive too.

Philippine Move to Goverment Run Online Gaming Site Poses Potential Problems for Live Operators

By Howard J Klein

Pagcor, the government run casino operator in the Philippines has announced its entry into online gaming–it could be a blow to brick and mortr casinos.
China is on record warning of Philippine illegal online sites “preying” on China citizens. Will this alter that attitude.
Due to launch early next year we believe this move portends bearish implications for the key Entertainment Zone stock we currently rate as unervalued.

China TMT Update-PDD/BABA/CPNG/SE/BEKE/1211HK/TSLA/XPEV/LI/NIO-Temu Launches in South Korea