TMT/Internet

• The market cap and liquidity review period for the June rebalance of the Stock Exchange of Thailand SET 50 Index (SET50 INDEX) ended yesterday.
• JMT Network Services (JMT TB), Jaymart PCL (JMART TB) and Berli Jucker (BJC TB) could replace Sri Trang Gloves (STGT TB), Ratch Group PCL (RATCH TB) and IRPC PCL (IRPC).
• Asset World Corporation (AWC TB) could be deleted depending on which levers the index committee tweaks, and that could save IRPC PCL (IRPC TB) from index deletion.

• Sound Shore Fund, Inc. is registered as a diversified, open-end management investment company. The investment objective of the Fund is growth of capital.
• The Sound Shore Fund Investor Class (SSHFX) and Institutional Class (SSHVX) declined 0.97% and 0.91%, respectively, in the first quarter of 2022.
• The current environment is providing a remarkably robust set of opportunities that we have not seen in some time.

• The Carillon Family of Funds spans a range of investment objectives and asset classes designed for long-term investors.
• Along with the spike in oil prices, energy stocks performed best during the quarter, followed by more defensive and countercyclical sectors like utilities and consumer staples.
• As we look toward the rest of 2022, we continue to see a somewhat balanced outlook for equity markets returns.

• The Carillon Family of Funds spans a range of investment objectives and asset classes designed for long-term investors.
• Small-cap stocks overall posted rather lackluster returns in the first quarter of 2022.
• Inflation and sharply higher gasoline prices have taken a chunk out of the consumer’s pocketbook.

• The Carillon Family of Funds spans a range of investment objectives and asset classes designed for long-term investors.
• Inflation concerns and accelerating expectations of interest rate hikes by the U.S. Federal Reserve sent equity markets in a downward spiral to start the new year.
• Investors continued to favor value stocks over growth stocks as small-cap value outperformed small-cap growth by more than 10% during the quarter.

• The Carillon Family of Funds spans a range of investment objectives and asset classes designed for long-term investors.
• The U.S. stock and bond markets appear to be conveying different assessments of the outlook, leaving investors to decide which view will prevail.
• The situation could favor U.S. stocks, as they are more insulated than their European counterparts from energy price spikes and the direct impacts of the war and its economic ramifications.

• The Carillon Family of Funds spans a range of investment objectives and asset classes designed for long-term investors.
• The U.S. stock and bond markets appear to be conveying different assessments of the outlook, leaving investors to decide which view will prevail.
• Focusing on how it affects markets, the war also is a concern for global growth and a source of volatility as the highly uncertain situation evolves.

• The Carillon Family of Funds spans a range of investment objectives and asset classes designed for long-term investors.
• Q1 2022 was marred by tragedy on a global scale and investors encountered three months of volatile trading induced by persistently high inflation, rising rates, and Russia’s invasion of Ukraine.
• Over the last 12 months many investors anchored to the long-term growth trends while discounting value’s recent strength, and more importantly the reasons behind it.

• The Carillon Family of Funds spans a range of investment objectives and asset classes designed for long-term investors.
• Mid-cap stocks overall posted rather disappointing returns in the first quarter of 2022.
• The outlook for the cyclical areas of the stock market appears mixed against a backdrop of higher commodity prices, rising interest rates, and geopolitical unrest.
• On a more positive note, strong pent-up demand for travel should help to bolster securities.

• Mercari Inc (4385 JP) was deleted from the MSCI Japan at the close today. Then the company announced that it would move to the Prime Market on 7 June.
• Transfer to Prime Market will require passive TPX INDEX trackers to buy stock end July and FTSE All-World trackers to buy in September – around 19% of free float together.
• Short interest is over 13% of free float. Some of the shorts would have covered against the passive MSCI selling today but the remaining shorts could look to cover.

• 4.5 months ago I wrote Mercari (4385) Applying for TSE Prime Means TOPIX Inclusion in 4-5 Months and today it was announced Mercari would move from TSE Growth to Prime.
• The move happens on 7 June, which means that the actual TOPIX inclusion will be at the close of 28 July. 
• This will change things near-term, and going forward. As always, we dig deeper below.

• The Nikkei 225 (NKY INDEX) market consultation released last week could lead to some tweaks to the index methodology and the stock selection process. Nothing really material enough though.
• Potential index inclusions in September are Renesas Electronics, Oriental Land and Pan Pacific International Holdings, while Toyobo Co Ltd, Nippon Light Metal and Oki Electric Industry are potential index deletions.
• Passive Nikkei 225 trackers will need to buy between 4-9% of the real float on the high/ medium probability names, while they need to buy between 2.5-14 days of ADV.

• GoTo announced its much-anticipated FY2021 and 1Q2022 results, which did not disappoint, with improvements in a number of different metrics across its main verticals.  
• 1Q2022 saw a QoQ increase for on-demand, e-commerce, and fintech versus a seasonally strong 4Q plus the group improved take rates and contribution margin in 1Q2022 versus 4Q2021.
• GoTo‘s guidance for 2Q2022 is positive and it should be boosted by higher commission rates plus continuing synergies across the group, helping to improve profitability and growth.

• Tencent reported lowest YoY increase in revenue in 1Q2022. Subsequent to this, Tencent mentioned during earnings call that it continues to scale back on loss-making activities across its business segments.
• Recent scale back of operation is in its cloud-services segment that includes loss-making activities such as projects with high proportion of sub-contractors and deeply discounted-contracts for CVM and CDN capacity.
• Layoffs have become prevalent as a cost cutting measure and Tencent is in the process of reducing headcount at gaming and fintech businesses.  

• IQiyi reported 1Q2022 results last week. Revenue fell 8.7% YoY to RMB 7.3bn (vs consensus RMB 7.22bn) and reported an OP of RMB 93.4m (vs consensus loss of RMB 297m).
• Growth in ARM helped offset decline in the number of subscribers for membership revenue. However, online advertising and content distribution both declined due to lack of content and macroeconomic weaknesses.  
• IQiyi’s shares have gained 11.2% since its earnings announcement as the company reported an OPM for the first time.

• TRIPLE-1 was established in 2016 and got its start designing highly power efficient ASICs used for cryptocurrency mining, partnering with TSMC to use its leading-edge nodes. 
• Since then the company has moved on to develop ASICs specialised in AI applications as well as for 5G base stations. 
• In all cases the company emphasises power efficiency and with significant gearing into local 5G networks the domestic focus could be a positive rather than a negative.

• Since our March-end report, our shorts – especially Kakao Pay – worked better than our longs, given the continuing turbulent conditions; Santander’s offer for Getnet minorities signals a specific opportunity
• We still favour Mastercard in the megacaps, and we stick with PagSeguro and Nexi despite both having disappointed; Cielo has been a strong performer, but we would not chase it
• Among our shorts, we remain negative on DLocal, given its very demanding valuations, and we still see Kakao Pay to be fundamentally over-valued; we reintroduce Paytm to the shorts list

• The AKM Industrial (1639 HK) scheme document is out with the court and EGM meeting on 22 June. The IFA considers the offer to be fair and reasonable. 
• The key condition is the scheme approval by at least 75% and rejection by <10% of disinterested shareholders. Shareholders who hold blocking stakes have provided irrevocables.
• At last close and for a 4 August payment, the gross and annualised spread to the offer is 1.1% and 6.2%, respectively. This is a done deal.

• Founded by value investor Wally Weitz in 1983, Weitz Investment Management, Inc. is a boutique, employee-owned asset management firm headquartered in Omaha, Nebraska.
• The Value Fund’s Institutional Class returned -7.96% for the first quarter.
• Our companies are generally reporting solid financial results, at least so far, and they are adapting fluidly to rapidly evolving conditions.

• BILI dismissed employees in game, e-commerce, and video in May.
• We believe the growth rates of minor businesses will slow down significantly in 1Q22.
• However, the operating margin will improve in 2022 and 2023.

• The Scheme Document Document for AKM Industrial (1639 HK), a flexible printed board player, has been despatched.  The Scheme Meeting will be held on the 22nd June. 
• The Offer Price is HK$1.82/share. It will not be increased. No further dividends will be added, 
• Trading tight at a gross/annualised spread of 1.1%/6.4%, assuming payment in early August.

• Harding Loevner has been investing globally in high-quality, growing businesses based on disciplined industry research since 1989.
• Stock markets fell in the quarter, as the world watched in horror Russia’s invasion of Ukraine.
• While we are optimistic that China will maintain its neutrality in the war, we can’t dismiss the possibility we are wrong.
• With the volatility of stock prices thisquarter, portfolio activitypicked up as a handfulof high-quality growth companies we had long admired, but regarded as too expensive, saw their valuations fall into range.

• Harding Loevner has been investing globally in high-quality, growing businesses based on disciplined industry research since 1989.
• Stock markets fell in the quarter, as the world watched in horror Russia’s invasion of Ukraine.
• While we are optimistic that China will maintain its neutrality in the war, we can’t dismiss the possibility we are wrong. In that case, we’d need to parse which companies will be hurt and helped, relatively, from a further receding of globalization.
• With the volatility of stock prices this quarter, portfolio activity picked up as a handful of high-quality growth companies we had long admired, but regarded astoo expensive, saw their valuations fall into range.

• Harding Loevner has been investing globally in high-quality, growing businesses based on disciplined industry research since 1989.
• Stock markets fell in the quarter, as the world watched in horror Russia’s invasion of Ukraine.
• While we are optimistic that China will maintain its neutrality in the war, we can’t dismiss the possibility we are wrong.
• In recent years, as growth investors chased speculative and expensive“disruptive innovators” up, and more recently down, we have maintained a steady commitment to quality growth at steady premiums to the market over time.

• eBay have made their first foray into NFTs by launching Wayne Gretzky collectibles, starting as low as $10 for their ‘Green’ tier, ensuring affordability for the everyday fan.
• They’ve partnered with OneOf, who help lifestyle and sports brands drop NFTs – as well as having their own marketplace for resale purposes.
• Buyers were able to purchase in fiat and were then taken to a landing page to mint the NFT for free.

• Splunk Inc (SPLK US) , a leading American provider of machine-generated data platform and established software vendor, announced strong 1QFY23 earnings results. 
• Total revenues grew to $674M, up 34% YoY, the highest revenue growth rate for the last 3 years. Cloud revenues jumped by 66%, reflecting customer adoption of the cloud platform.
• WSJ reported that Cisco made a $20B+ takeover offer for Splunk. However, no deal was on the table, but if talks resume, Cisco could pay $20B+, according to The NYT.   

• Argosy Investors is a fee-only investment adviser seeking to earn above-average returns through a risk-conscious approach that allows us to maintain significant amounts of cash if the conditions warrant, and to deploy capital quickly and aggressively when opportunities are more plentiful.
• 2022 first quarter performance was -15.1% in select accounts.
• Analyzing many businesses can be challenging, and could require a greater degree of conservatism in assessing likely sales and/or margin potential.

• Harding Loevner has been investing globally in high-quality, growing businesses based on disciplined industry research since 1989.
• Stock markets fell in the quarter, as the world watched in horror Russia’s invasion of Ukraine.
• China-based WuXi Biologics illustrates the perfect storm of macro issues pressuring the share prices of our rapidly growing companies.
• As questions mount whether globalization has reached a tipping point, companies are taking full advantage of the many advances occurring across the industrial automation landscape— propelling leadingp roviders of “Industry 4.0” solutions onto favorable growth paths.

• Online auto parts and service provider Infomedia Ltd (IFM AU) has received a second non-binding proposal  – by way of a Scheme – this one from PE outfit Battery Ventures. 
• The Offer price is A$1.75/share, a 36.7% premium to last close, and a A$0.05/share premium to TA/Viburnum’s proposal earlier this month. 
• As with TA, Battery has been granted limited due diligence. With a 19.4% stake, TA remains very much in the driver’s seat.

• Infomedia Ltd (IFM AU) disclosed an indicative non-binding proposal from Battery Ventures at A$1.75 a share, a 2.9% premium to TA/Viburnum’s offer of A$1.70 per share.
• Infomedia is in preliminary discussions with several other interested parties. The other interested party is rumoured to be the auto software business OEConnection.
• The situation is reminiscent of the ongoing bidding war for Virtus Health (VRT AU) between CapVest and BGH Capital. Expect at least another round of bids. 

• Maintain our BUY recommendation with TP of Bt29.75,derived from 27.0xPE’22 (+2SD of average 10-yr trading). Yesterday’s analyst meeting came out with neutral tone. While we are cautious of the inflationa
• Management affirms that weakening consumer demand, shortages caused by China lockdowns and Russo-Ukrainian War, and weakening Baht will not impact SYNEX’s 2022 performance.
• Management maintains their guidance of +15% revenue growth YoY in 2022, but admits post-2022 top-line growth will not match the levels seen during Covid period (2020-21).

• Harding Loevner has been investing globally in high-quality, growing businesses based on disciplined industry research since 1989.
• Emerging Markets (EMs) declined sharply, primarily due to the collapse in Russian equities brought about by economic sanctions against Russia because of its invasion of Ukraine, as well as poor performance in China.
• The EM landscape is currently fogged by an exceptional confluence of risks: armed conflict in Ukraine, inflation, rising interest rates, volatile commodity prices, and concerns about food and energy security.
• Although we made only a handful of transactions this quarter, the portfolio’s profile changed significantly because of the write-down of our Russian holdings and the outsized returns of stocks benefiting from commodity price inflation.

Lucror Analytics Weekly Wraps provide an overview of all Morning Views comments and reports published by our analyst team in the past week, and also showcase a list of the most-read reports.

In this Insight:

1. Adani Ports & Special Economic Zone
2. Yanzhou Coal Mining Company Limited H
3. Vedanta Resources
4. Indika Energy
5. Pakuwon Jati

and more…

• The Nikkei Index Team has suggested a methodology change to the Nikkei 225 Average.
• It involves capping stocks, creating a method for re-weighting once capped then stocks fall, and they recommend changing to a semi-annual Periodic Review – twice a year rather than once.
• More interestingly, they also change the “High Liquidity” definition to be related to traded value not volume, which starts to favour higher-market cap stocks with more shares out.

• The Hang Seng index constituents have moved away from just local Hong Kong shares to being dominated by China H and China-centric shares
• Focusing on these constituents adds much value, especially with shifting liquidity away from US-listed ADS to HKEX listed shares.
• It brings together a more diverse investor base ranging from local Hong Kong, mainland China and the rest of the world.

• AI data service provider Appen (APX AU) has announced an unsolicited, conditional, and non-binding indicative proposal from Canada’s Telus International, by way of a Scheme of Arrangement, at A$9.50/share.  
• That’s around a 48% premium. Appen’s board is seeking an improvement in terms through offering a limited course of due diligence.
• The Offer backs out an equity value of A$1.2bn, significantly down from Appen’s 2020 pandemic peak of A$5.4bn.

• In response to media reports, Appen Ltd (APX AU) disclosed a non-binding indicative proposal from Telus International (TIXT US) at A$9.50, a 48.4% premium to the undisturbed price of A$6.40.
• Appen also announced a weak trading update. The 1HFY22 EBITDA is expected to be materially lower than the comparable period due to the lower revenue and the ongoing investment. 
• Subsequently, Appen noted that Telus revoked its indicative proposal. No reason was given for the decision. Nevertheless, Appen’s depressed share price will continue to attract suitors. 

• MediaTek’s revised downward forecast for 650-680nm smartphone delivery in 1Q22 earnings conference, but we think that number could be revised down again by the end of July.
• MediaTek announced new WiFi products, Filogic 880 and 380, in COMPUTEX2022 on May 24-27. Besides, MediaTek invests in new opportunities for AI in the US.
• The mainland China fights fiercely against COVID-19 and stays at the Zero Policy. 

• There is a strong possibility of the launch of corporate growth fund private companies ETFs in Korea in 2023. 
• Once government gives final approval to launch the unlisted Korean companies ETFs in 2023, there is likely to be much greater interest in investing and researching in private Korean companies.
• Starting next year, there is a strong probability that we will spend a lot more time on researching and writing about these promising, private companies in Korea. 

• Tidefall is a concentrated, unconstrained investment fund that attempts to compound its capital at an attractive rate of return. Our investment advantage comes from our in-depth research, long-term time horizon and appreciation of biases.
• With Netflix stock down by more than 50% since its high in November (and 10% below Reed Hastings’ $20m purchase in January) we re-entered the position in April.
• We believe the current price of Netflix shares creates a compelling long term investment opportunity.

• Wedgewood Partners is a money manager founded in 1988 with the goal of providing investors with a superior approach to managing investment portfolios.
• For the first quarter 2022, our Composite (net)i declined -10.6%.
• We expect to be busy this year as all financial markets come to grips with the Federal Reserve’s unprecedented task of reigning in 40-year highs in inflation with two monetary tightening tools.

• Ignore the slight macro weakness from consumer facing internet companies in April. It is irrelevant for the LT model. 
• Snowflake upped its LT (FY2029) targets: $10B in revenues, growing 30%, 78% product margins, 20% operating margins, and 25% adjusted FCF margins.
• At 12x forward revenues, Snowflake’s valuation is…dare we say… cheap?

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.

• Adani Ports & Special Economic Zone
• Bharti Airtel
• Lenovo
• Vedanta Resources

• Telus International (TIXT US) has made an unsolicited, conditional and non-binding indicative proposal to acquire 100% of Appen Ltd (APX AU) at A$9.5/share, valuing the company at A$1.17bn.
• The offer is a 48% premium to the last close but a discount to longer-term VWAPs. It should require a bump for the Appen Board to unanimously recommend to shareholders.
• Appen Ltd (APX AU) is a potential deletion from the S&P/ASX 200 (AS51 INDEX) at the June rebalance. Short interest is 10% of shares out. There will be covering.

• Total revenue grew by 15% YoY and operating margin improved YoY in 1Q22.
• The authorities began to grant licenses and new games will be launched in China and overseas.
• We set an upside of 25% and a price target at US$120. Buy.

• We believe UMC’s 3Q22 order is full, but the growth could be within 3% QoQ.
• Asian clients are turning weak, and US clients are getting stronger.
• The mainland China demand could be making an impact because of the COVID-19 pandemic.

• Heo Jae-Myeong, the CEO of Iljin Materials, is planning to sell his 53.3% stake in the company.
• Potential buyers of Iljin Materials include Lotte, SK, LG, and POSCO.
• The CEO Heo Jae-Myung could potentially receive greater amounts of money if he sells the company now, rather than waiting when the compulsory tender offer could be made into law.

• Sixth Street and BGH Capital entered into a cooperation agreement with the aim to acquire Pushpay Holdings (PPH NZ) through a scheme of arrangement. They have a combined 20.3% stake. 
• In addition to Sixth Street/BGH, Pushpay also noted expressions of interest from multiple parties. The high recurring revenue, profitability and cash generation make it a target. 
• As the Australian takeover premium ranges from 20% to 40%, we think that a bid of at least A$1.46 (30% takeover premium) will be necessary for due diligence access. 

• Launched in late 2020, inPlay.ph is the first pure play online real money gambling platform aimed at attacking revenue of illegal sites.
• DFNN is also licensed for electronic gaming machines, a sports betting exchange and pari-mutuel betting for the government run Pagcor sector.
• Income from interactive tech platforms including the online gaming unit increased 116.6% for the quarter to 229.3m php.

• Grab‘s latest results sent a mixed message and if looked at YoY the picture looks gloomy but there is a strong sequential recovery with declining incentives for deliveries.
• Mobility is seeing recovery with higher incentives to bring on drivers and consumers but these should start to decline in 2H2022, with company guidance for revenues reflecting this. 
• Grab continues to build its financial services offering through digital payments coupled with BNPL, and growing a digital banking footprint. Valuations are attractive and it has US$8.2bn in cash liquidity.

• Snapchat’s guidedown resulting in a 30% drawdown is fantastical.  6x sales is now 4x sales, near alltime lows.
• Was guide down worth 30% drawdown given already valuation compression and  volatility of Snap guidance? Sour grapes here.
• Of course macro deteriorated. Who is doing Snap’s forecasting? We think forecasting easier to fix than LT competitive moat. We’d buy SNAP…but buy FB first!

In our next Webinar, we welcome Analyst Patrick Liao, who will go over his picks among Greater China semiconductor companies, exploring the outlook for the rest of 2022 and beyond.

The webinar will be hosted on Wednesday, 1 June 2022, 17:00 SGT/HKT.

• There are 12 inclusions and 12 exclusions for the KOSDAQ 150 Index (KOSDQ150 INDEX) at the June rebalance to be implemented at the close on 9 June.
• Most of the inclusions were expected, but there are quite a few surprises among the deletions. The impact on the deletions will be higher than that on the inclusions.
• The adds have outperformed the deletes and there has been another leg up in the last couple of weeks. Expect the trend to continue till implementation week.

• Grab raised around US$4.5bn in its de-SPAC listing in Dec 2021. The shares are now trading around 68% below the listing price.
• At the time of listing, all of its top investors were locked up for six months. The lock-up expires on 30th May 2022.
• In this note, we will talk about the lock-up dynamics and updates since our last note.

• The additions are primarily in line with the predictions. But, the deletions contain many surprises. Webzen is the biggest surprise. Echo Marketing should also surprise a lot of fund trackers.
• Creas F&C will face the most substantial passive inflow at 4.08x ADTV, closely followed by Unitest. But factoring in liquidity, WYSIWYG Studios will likely draw the most attention
• JNTC will suffer the most among the deletions. However, Webzen will likely be in the limelight as its outflow is by far the largest at ₩8.6B, equivalent to 3.84x ADTV.

• Kuaishou reported 1Q2022 results on Tuesday. Revenue grew 23.8% YoY to RMB21.1bn while reported operating losses declined to RMB5.6bn (27% of revenue) from RMB7.3bn (43% of revenues) in 1Q2021.
• Adjusted operating losses for the quarter further dropped to 24% of revenues from 48% of revenues in 1Q2021 despite drop in livestreaming ARPPU in 1Q2022.
• Kuaishou’s shares have lost almost 80% since its IPO in February last year due to the regulatory crackdown.

• Revenue increased by 24% YoY with online marketing, the main business, up 33% YoY.
• KS operating loss decreased to RMB5.1 bn in 1Q22 from RMB8.2 bn.
• We set an upside of 19% and a price target of HK$75.00. Buy.

• One of the curious share price movements this year has been the outperformance of Samsung Electronics versus other global tech peers including Apple, TSMC, Intel, and Xiaomi.
• Three reasons why Samsung is outperforming global peers such as Apple and TSMC may due to a potential war in Taiwan, COVID lockdown in Shanghai, and new pro-business Korean President.
• Caution is warranted on playing long/short on Samsung, Apple, and TSMC in the coming months as their tides appear to be driven too much by the whims of global politics. 

• Freshworks (FRSH US)  upgraded its revenue guidance to ~$502M at the top end for FY22 and reported a 42% year-over-year revenue growth rate in 1QFY22. 
• We were impressed with subscription revenue growth, lower-than-expected loss, customer expansion, and efficient SaaS metrics. 
• We analyzed multiples of 50 publicly listed software companies with various growth profiles and split SaaS/Fintech companies into four growth groups.

• The collapse of UST/LUNA wiped out nearly USD50bn of market capitalization last week due to a poorly structured stable-coin design and threw the crypto markets into chaos
• A potentially bigger risk looms on the horizon as USDT’s collateral is questioned as market test its ability to meet redemption requests
• USDT is a USD70bn stablecoin, 5x as large as UST, and underpins the entire crypto infrastructure. This is the critical space to watch for the future of crypto. 

• We expect China Railway Group Ltd H (390 HK) and Yanzhou Coal Mining (1171 HK) to replace Smoore International (6969 HK) and Sunny Optical (2382 HK) in the FTSE China50 Index.
• There are capping changes that have a reasonable large impact on a couple of stocks. One-way turnover is estimated at 3.97% and will result in a one-way trade of HK$1,912m.
• FTSE has increased the investability weight for Li Auto (2015 HK) / Li Auto Inc. (LI US) and this leads to the stock failing the median liquidity test.

• Delhivery raised around US$680m in its India IPO, the company is backed by a host of financial investors, the largest being Softbank.
• Delhivery is an online logistics service provider which covers express parcel delivery, heavy goods delivery, part truckload (PTL) freight, truckload (TL) freight, supply chain solutions, cross border solutions etc.
• We have covered various aspects of the deal in our earlier notes. In this note, we talk about the demand and trading dynamics. 

• Next Chip (396270 KS) is getting ready for an IPO in Korea in June. The IPO price range is from 9,900 won to 11,600 won.
• Next Chip is a Korean system semiconductor company for automobiles and autonomous vehicles. Next Chip was split from NC& Co Ltd (092600 KS) in January 2019.
• The bankers used four companies including Abov Semiconductor (102120 KS), MCNEX Co Ltd (097520 KS), Chips & Media, and Telechips as comps for Next Chip Co.

• Relative underperformance of Intel Corp (INTC US)  versus Advanced Micro Devices (AMD US)  over the last decade should reverse.  We discuss what it would take in the note.
• Intel leads in number and quality of innovations versus AMD in core areas of Design and Manufacturing, but AMD’s use of TSMC has been a huge part of AMD’s outperformance
• If Intel adapts to new realities and uses TSMC (2330 TT)  for next-gen products, outperformance versus AMD is highly likely otherwise given TSMC’s very significant lead in manufacturing very doubtful. 

• After market close on Friday 20th May 2022, the constituency changes for S&P BSE 100, SENSEX 50, and SENSEX Next 50 Indices were announced. 
• There will be no changes for S&P BSE SENSEX and S&P BSE BANKEX Indices in the June 2022 Rebalance. 
• These changes will become effective at the open of Monday 20th June 2022. Below is a closer look at each of the names involved in the June 2022 Rebalance.

• Analyst meeting came out with negative tone. We maintain BUY rating at Bt57.50, based on 21.3xPE’22 (+1SD of 10-yr trading average). Our TP and 22E downwards earnings revisal by 6% 
• 2Q22 should be lowest of the year due to declining sales from decrease by 25% in output in Chinese factories.Recommend accumulating shares,due to attractive valuations, prior to 2H22 earnings recovery.
• 2H22 earnings will recover from GPM expansion from revenue contribution from new SiC segment (consistently gross loss until now)and better product mix in IC Thai factory.Sales should also grow moderately