TMT/Internet

• Q1 was a challenging quarter for Cloudflare as the company failed to meet the revenue expectations of Wall Street as a result of various the headwinds.
• However, macroeconomic uncertainty lengthened sales cycles and affected close rates, resulting in a back-end weighted quarter.
• Despite these challenges, Cloudflare remains resilient and profitable, with an operating profit of $19.4 million and generating $13.9 million of free cash flow.

• Fidelity National Info (FIS) had a successful start to 2023, surpassing Wall Street expectations in terms of revenues as well as earnings.
• FIS experienced significant recurring revenue growth in their banking and capital markets businesses and impressive organic growth in their e-commerce segment.
• We give Fidelity National Information Services a ‘Buy’ rating with a revised target price.

• First Solar had a very disappointing result in the last quarter as it failed to meet the revenue expectations as well as the earnings expectations of Wall Street.
• With their CadTel technology, vertically integrated manufacturing process, and commitment to Responsible Solar, First Solar could stand out from competitors and maintains long-term competitiveness.
• The recent acquisition of the European perovskite company, Evolar AB was also a part of the expansion strategy.

• The announcement of the changes for the June rebalance of the local China indexes was made post market close on Friday.
• A busy week is coming up with rebalance implementations, review cutoffs and announcements.
• There were inflows to iShares MSCI Japan ETF (EWJ US), Wisdomtree Japan Hedged Eq (DXJ US) and Jpmorgan Betabuilders Japan (BBJP US) during the week.

• It was a challenging yet promising quarter for Snap as it failed to meet the revenue expectations of Wall Street but surprisingly managed to deliver a positive bottom-line.
• Despite a 7% year-over-year decrease in revenue, the company reached 383 million daily active users in Q1 and showcased the community’s continued growth.
• Snap introduced My AI, an AI-powered chatbot, and unveiled new features at the Snap Partner Summit, emphasizing their commitment to innovation.

• The possibility of SKC securing additional shares other than the planned 40% through a tender offer seems low. This is a basis for the recent short position build-up in ISC.
• ISC began to experience an influx of short selling, leading to it being designated as an overheated short-selling stock, and short selling was restricted for one day on the 26th.
• We need to pay attention to the potential disappointment in the market, which could lead to a sustained downward correction in the stock price.

• Meituan (3690 HK) ’s 1Q2023 earnings beat consensus estimates and the key highlight was the company turning into adjusted operating profits after two years.
• Revenue from Core local commerce continued to see strong growth in earnings though we expected growth rates to decline with pandemic conditions easing off.
• Meituan has launched its food delivery app “KeeTa” in Hong Kong which is dominated by Foodpanda and Deliveroo.

• GoTo released a Newsletter for May which reiterated its progress toward profitability as well as some key initiatives including increasing service fees and expanding use cases for GoPay Coins rewards.   
• The newsletter also highlighted the release of the Annual Report and its Sustainability report, which are both important documents for longer-term and increasingly ESG-focused investors. 
• GoTo also highlights a report from the University of Indonesia regarding the company’s socioeconomic impact in the country, which remains huge given its socio-economic reach through ODS and Tokopedia. 

• The chip industry is seeing two “transitions” Intel is being phased out with the GPU shift, according to the company.
• The company is also expected to be phased out of the chip industry with the next generation of processors.
• The chip company is expected to have a new generation of chips in the coming years.

• NetEase reported in-line revenue for 1Q23, while non-GAAP net income exceeded our estimate by 22%. 
• <Justice Mobile> is set to launch by the end of June. We anticipate that investors may need to wait for some time after June for NetEase’s next potential hit title. 
• Maintain a BUY with TP unchanged, implying 18X PE in 2023.

• It was a successful first quarter for L3Harris as they delivered an all-around beat while building momentum in orders and backlog.
• The company saw top-line growth of 9% across all segments, along with improved operating income in two out of three segments.
• They also reaffirmed their 2023 guidance, with a potential bias towards the higher end of the revenue range due to strong revenue growth and significant orders.

• T-Mobile delivered a mixed set of results in the first quarter with revenues below Wall Street expectations but it managed an earnings beat.
• The company’s sustained growth in postpaid accounts and ARPU produced the strongest year-over-year postpaid service revenue growth in the market, up 6%.
• This quarter, the company added 287,000 net postpaid account additions.

• Weibo’s 1Q23 top line was in line with our est., and non-GAAP net income beat our est./cons. by 6.5%/ 7.6%, due to cost-saving measures. 
• While we dial down its 2Q23 revenue forecast, we remain optimistic about its growth in 2H23, as more brand advertisers gradually recover. 
• Maintain BUY and TP unchanged, which implies 12X PE in 2023.

• Meituan reported 1Q23’s rev./non-IFRS net income 2.5%/126% vs. our est., the strong margin beat is due to efficiency improvements in all business lines;
• To compete with Douyin’s in-store business, Meituan will spend more in 2Q23, however FD and insta-shopping continue to have margin upside. 
• Our BUY thesis remains unchanged, as we believe investors overestimate Douyin’s impact, while underestimating Meituan’s ability to improve margins. 

• Mastercard had solid revenue and earnings growth in the latest quarter and started 2023 with an all-around beat.
• On a non-GAAP currency-neutral basis, excluding extraordinary items, adjusted net revenues were up 15% and adjusted operating income was up 17% over the prior year.
• Payment network net revenue climbed 10%, driven by domestic and cross-border transaction and volume growth and a rise in rebates and incentives.

• Media reports indicate that the HDFC Bank (HDFCB IN) merger with HDFC Limited (HDFC IN) is expected to complete in 4-5 weeks.
• There will be inclusions to the NIFTY Index, Nifty Next 50 Index and S&P BSE SENSEX Index and capping changes to the Nifty Bank Index apart from changes to global indices.
• While the impact on the merging entities is not big, there will be fairly large flows on some stocks that are index inclusions or affected by capping changes.

• Nvidia’s results and guidance sparked a massive rally in the shares, marking one of the largest single-day increases in market cap in U.S. stock market history.
• The company sees a multi-year growth cycle of data center upgrades ahead. Key supply chain partners TSMC and ASML are rising as well.
• Wiwynn in Taiwan should be a key winner. We also highlight a potential wildcard smallcap AI play that we will investigate further.

• Q1’23 revenues of ¥764 billion, up 15% YoY and 2.6% QoQ
• FY2022, revenues grew by 13.2% to ¥2,859 while net income grew by 3.9% to ¥219.4.
• Electronic Materials set to grow from ¥180 billion in ’22 to ¥500 billion by ’30

• In 1Q23, total revenues grew by 27% YoY with all business lines up by more than 10% YoY.
• The real operating profits turned positive after nine quarters’ losses.
• We believe the stock has an upside of 35% for yearend 2023. Buy.

• Xiaomi reported C1Q23 top-line and non-IFRS net income (6.9%) and 20.7% vs. our est., and in-line and 39.9% vs. consensus; 
• We suggest that higher margins are transitory, as (1) key IC component prices may have bottomed, (2) EV spend is likely to ramp up further. 
• We maintain SELL and HK$ 8.2 TP, implying 26x FY23 PE.

• BZ reported 1Q23 cash billing 2.9% higher than our est.; revenue in-line with our estimate and consensus;  and non-GAAP NI 36.3%/35.3% higher than our est. and cons.
• As BZ approaching the proxy of China’s labour market, its primary hurdle is the slow recovery of labour demand and mismatch of supply and demand.
• We maintain SELL rating and TP at US$13.5., as we are still waiting for signal for the overturn of job seeking market in China.

• On May 22nd, Meituan launched its food delivery platform called KeeTa in Hong Kong SAR.
• KeeTa’s expansion stratgies include Collaboration with branded chain merchants,lower ASP, subsidy campaign, and launching “On-time Guarantee”.
• Sofar the initial results after launch seems to be in-line with expecation, while  there will still be a lot of challenges, like small market size and stabilized competition landscape.  

• Alibaba Health Information Technology (241 HK) ’s 2HFY03/2023 revenues beat consensus by 1.4% while adjusted operating losses of RMB1.74m (0.01% of revenue) is significantly lower compared to 2HFY03/2022 and consensus.
• Improvement in profitability was driven by improved GPM coupled with decrease in SG&A costs which helped offset increase in fulfilment costs as a result of the Covid-19 outbreak.
• Our quantamental analysis suggests that Ali Health’s margins have very little room for improvement unless the company cuts down SG&A significantly while improving revenue % from non-direct pharmaceutical businesses.

• Only six months after its establishment, Singapore-based Locofy launched a beta of its low-code development tool in January 2022.
• It has since received over 100,000 sign-ups across 195 countries.
• Its tech helps designers automate front-end code directly from their designs and integrate them with existing workflows, leveraging AI to convert designs into coding languages to save time.

• Intel delivered solid first-quarter results with revenues above expectations and narrower than expected losses.
• The fallouts of this quarter demonstrate the advancement Intel is making to advance the company’s transformation as well as the IDM 2.0 strategy.
• In the quarter, Intel introduced its 13th Gen Intel Core Mobile processor, followed by its new vPro platform.

• FLEETCOR Technologies delivered another all-around beat while managing a decent top-line growth and accretive operating leverage.
• The company had $901 million in revenue, a 14% increase, and cash EPS of $3.80, a 4% increase.
• We give FLEETCOR Technologies, Inc. a ‘Hold’ rating with a revised target price.

• Singapore-based insurtech startup bolttech has closed its Series B financing round at US$196 million, led by existing shareholder Japanese insurance holding company Tokio Marine.
• Other key investors include global life insurance giant MetLife through its subsidiary MetLife Next Gen Ventures, Malaysia’s sovereign wealth fund Khazanah Nasional, and new and existing shareholders.
• This funding takes the company’s valuation to US$1.6 billion and comes exactly seven months after Tokio Marine led the first tranche of bolttech’s Series B round.

• Singapore-headquartered telehealth platform ORA has raised US$10 million in a Series A funding round co-led by TNB Aura and Antler.
• Gobi Partners, Kairous Capital, and GMA Ventures also joined the round, bringing ORA’s total funding to date to above US$17 million.
• With this new round of funding, ORA will seek to expand its presence into new territories, both geographically and with new offerings.

• Trimble delivered mixed results in the first quarter, with revenues of $915 million that were below Wall Street expectations.
• The quarter’s cash flow improved significantly year on year, with both cash flow from operations and free cash flow exceeding non-GAAP net income.
• Revenues in the transportation business increased organically year over year during the quarter, and operating margins were higher than 15%.

• Alibaba Group Holding Ltd. outlined timetables for several key business units to complete spinoffs or pursue independent share sales, kicking off major moves in a sweeping reorganization to break up the gigantic conglomerate and unleash new growth momentum.
• Alibaba’s board of directors approved a full spinoff of its cloud services division while exploring initial public offerings for the logistics and grocery arms, the company said Thursday.
• The e-commerce giant plans to carve out the Cloud Intelligence Group within 12 months through a stock dividend distribution to shareholders, meaning it could relinquish control of China’s biggest cloud services platform.

• China just announced game approval for May batch. The number of games approved is in-line with the pace of approval in recent month.
• Pace of China game approval stays flattish, at a much slower pace than pre-tightening.
• Both Tencent and Netease received approval for one game. We saw a pattern of approval rotation for the duo.

• Wistron Corp’s share price is up 96% in the past six months. Despite its outstanding results, a lot of the positives have already been reflected in its share price.  
• We think a more likely scenario for the stock is to undergo a period of share price consolidation in the next several months. 
• Its valuations also appear stretched, especially in terms of P/E and P/B valuation multiples as compared to their historical valuation multiples. 

• Delivered FY’23 net sales of ¥$211 billion, up 57.5% sequentially.
• FY’23 operating profit of ¥35 billion was up 63% sequentially
• Our favourite Japanese semi stock with a TTM P/E <5

• China bans Micron chips for critical information infrastructure — Taiwanese firms could benefit by straddling both sides of the trade tensions.
• TSMC rallies as U.S. and Japan advance incentives for TSMC and Taiwanese firms.
• Nvida earnings this week — We’ll see if the AI leader can keep the market excited about AI’s brave new world.

• First of all, Nvidia is a great business with many applications and infrastructure across many industries and one can even say an AI hardware leader down the road. 
• Overall, a big business with a wide moat in a great secular sector, hence a name that very likely will be here 10-20-30 years down the road.
• Semiconductors in general have been a top sector lately given AI advancements like the ChatGPT breakthrough, and the overall combo of high demand & supply issues.

• Qualcomm’s fiscal Q2 results were decent with revenues above expectations and earnings in line with the analyst consensus estimates.
• It is considered a fair result given the difficult macroeconomic climate and widespread decline in the semiconductor industry.
• During the quarter, there was significant use of Qualcomm’s Snapdragon digital chassis across major OEMs and Tier 1 clients in automotive.

• The IRS would offer a free tax filing option is unlikely to have a material impact on TurboTax.
• The company is taking the right steps to differentiate its service offerings which creates significant pricing power.
• The recent news that the IRS would Offer a free filing option was unlikely to be a material effect on Turbo tax.

Datatec reported group continuing revenue growth of 13% for FY23 (20% in constant currency) with adjusted EBITDA from continuing operations also increasing 13%. Supply chain issues started to ease allowing the company to accelerate delivery of its order backlog. Demand remained robust, resulting in a flat order backlog at the year-end, despite double-digit revenue growth. At a divisional level, Westcon delivered excellent results, Logicalis International performance was solid and, while down for the year, Logicalis LatAm rebounded in H223. Management expects all divisions to deliver improved performance in FY24; we are reviewing our forecasts.

• HubSpot had a strong first quarter as it continued to execute its bimodal strategy, with net customer additions increasing significantly at the lower end of the market resulting in an all-around beat.
• The connected platform of HubSpot continued to gain momentum, especially Sales Hub, which saw Liquidity Services reduce costs by 50% after adopting it.
• HubSpot’s bimodal strategy, which focuses on driving volume at the low market while increasing value upmarket, has proven successful, as demonstrated by the company’s strong customer growth in both segments.

• Today was the review cutoff for the June rebalance of the Yuanta/P-Shares Taiwan Top 50 ETF. We see one potential change at the review.
• Passive trackers are estimated to buy nearly 6 days of ADV on Pegatron Corp (4938 TT) while selling around 1.7 days of ADV on Silergy Corp (6415 TT).
• Short interest on Pegatron Corp (4938 TT) has continued to drop as the stock has moved higher; Silergy Corp (6415 TT)‘s short interest has risen as the stock has dropped.

• Weaknesses of BABA stock and China tech sector in general post their strong earnings recovery for March quarter suggest market’s concerns centering around growth outlook.
• BABA fundamental has tracked well to our projection since last November. P/E multiple contraction – which priced in too much pessimism – prevented our bullish call from materializing, for now.
• We stick to our thesis that March quarter results set stage for BABA re-rating on sustained recovery, well-executed overhaul effectively unlocking value and investors’ renewed appetite for China assets.

• Grab‘s1Q2023 made for positive reading with rapid revenue growth and a quickening of progress towards profitability but the focus perplexingly seemed to be drawn to the ethereal measure of GMV. 
• The delivery segment saw the most significant GMV slowdown, impacted by a high base and seasonality but saw rapid revenue growth and record margins. Mobility remained the cash cow.
• Grab‘s profitability improved considerably in 1Q2023 across all segments, with management upgrading the outlook for FY2023 for adjusted EBITDA and maintaining its breakeven target for 4Q2023, which now looks conservative.

• We spent the second half of last week meeting ECM focused clients in Hong Kong.
• Overall, the mood remains somewhat grim for Hong Kong/China and it will be up to a few upcoming deals to open up the market again.
• In this note, we talk about some of the feedback for the upcoming IPOs and placements.

• The revenue growth rates of all business lines accelerated in 1Q23.
• Operating losses shrank to RMB1.3 bn in 1Q23, less than RMB3 bn in two previous quarters.
• We believe the stock has an upside of 66% for the yearend 2023.

• Kuaishou Technology (1024 HK) ’s 1Q2023 earnings were above consensus estimates with the company reporting positive adj. EBITDA and adj. net profit during the quarter.
• Operating profit margin of the domestic business further improved while the company managed to significantly reduce operating losses of the overseas business during the quarter.
• Kuaishou also announced a small share buyback worth of HK$4bn which further affirms the company’s improving fundamentals and should help attract investors.

• In this insight, we take a look at the names leading the race to become ADDs/DELs for the T50 and T100 Indices for the June 2023 Rebalance.
• I see one change for the T50 index and four changes for the T100 index.
• Even though our standalone flow expectations for the T100 index is insignificant, there is one name with important flow consequences in June 2023.

• In the evening of May 20th, NetEase held an online conference where it announced release dates for games…
• …that It has Previously Announced, and Unveiled New Titles that Will Be Launched in the Future.
• Overall, June Will Be the Peak Month for Newly Launched Titles from NetEase, with One Big Game (Justice Mobile) And Two Smaller Games (Badlanders and Racing Mobile)

• Our base case valuation of PhilEnergy is target price of 41,545 won per share, which represents 38% higher than the high end of the IPO price range of 30,000 won. 
• We believe a premium valuation multiple to the comps (20%) is appropriate due to PhilEnergy’s higher sales growth rate and higher ROE than the comps in 2021 to 2023.
• We estimate the company to generate sales of 312.5 billion won in 2023 (up 64.7% YoY) and 361.5 billion won (up 15.7% YoY) in 2024.

Vection Technologies recently announced the integration of ChatGPT into its flagship product, 3D Frame, enabling the creation of an artificial intelligence (AI) assistant within three dimensional (3D) and virtual reality (VR) environments. We believe this is a good example of an enterprise quickly integrating third-party AI to deliver a significant enhancement to its existing products within a timescale (and budget) that was unimaginable 12 months ago.

• This past week saw dramatic moves in Japanese stock markets. TOPIX +3.1% N225 +4.8% – up the 6th week in a row – closing at their highest in 33 years. 
• Flows were positive the week before, and I expect we’ll see next week they were positive this past week. But most striking was the interplay between Nikkei 225 and TOPIX.
• If foreign inflows increase, Nikkei is likely to outperform TOPIX both because of its existence and previous use, and its construction. And that means watching one’s trades, shorts, and executions.

• We summarise the latest spreads and newsflow of merger arb situations covered by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Philippines, Thailand and Chinese ADRs.
• Highest spreads – 111 Inc (YI US), Estia Health (EHE AU), HKBN Ltd (1310 HK), United Malt Group Ltd (UMG AU), Hailan Holdings (2278 HK), Aag Energy Holdings (2686 HK).
• Lowest spreads – Healius (HLS AU), Liontown Resources (LTR AU), Lian Beng (LBG SP), SBI Shinsei Bank (8303 JP), Allkem Ltd (AKE AU), Penguin International (PBS SP).

• TSMC’s ADR premium has enjoyed a significant rally perhaps due to increased international attention driven by positive U.S. and Japan news flow.
• ASE’s ADR premium has dropped to one of the lower values in its most recent range since the start of 2023, representing a gradual decline in this persistent premium.
• Chunghwa Telecom’s ADR is trading at a discount that likely represents a decent set-up level for this tightly trading spread.

• Delta Thailand has rallied 22.7% from its recent low, despite the local Thai market declining while the Taiwan market rose.
• Latest Delta Thailand surge unlikely due to Thai market fund flows or company developments. Delta Taiwan generates 2.5x the net profit with similar growth, yet has a smaller market cap.
• Over time, relative pricing should trend in Delta Taiwan’s favor as valuations are likely to drive longer-term performance — Also, should the SET50 Index be fixed? Seems broken.

• Q1’23 revenues of ¥558.2 billion, up 19% sequentially and up 1% YoY
• FY24 outlook down 23% YoY with H2 showing a modest improvement compared to H1
• R&D & CapEx investment increasing significantly while YoY revenue set to decline by 23%

• KPIT reported a strong Q4FY23 with 8.5% QoQ growth in CC (Constant Currency) terms. Q4FY23 EBITDA margin at 19.1% came in higher than 18.5%+ expected.
• Deal TCV came in highest ever helped by a mega deal of INR $250mm. Even excluding the mega deal, the deal TCV was healthy at $173mm vs $150mm+ typically.
• KPIT has guided for an upbeat FY24. FY24 revenue growth is guided to be 27-30% in CC terms. FY24 EBITDA margin is guided at 19-20% vs 18.9% in FY23.

• There is a high likelihood of the Indian authorities fully approving the BGMI game after three months of trial. Plus, it has a solid pipeline of new games under development. 
• Krafton is improving its shareholder return policy. In addition, the consensus is likely to raise the company’s earnings estimates post its excellent results in 1Q 2023. 
• We maintain our Positive view of Krafton and its shares are likely to continue to outperform the market this year. 

• At TMA we deliver high probability outcomes by focusing on our 3 pillars of technical analysis. •1) Response to key levels. •2) Price action. •3) Momentum confirmation.
• On 27 March 2023 we identified a pending 6.2% upswing in NQ1 and 13740 target. A further bullish outlook would hinge upon the response to 1yr range highs at 13740.
• Our interim target at 13740 was achieved and exceeded last week. The weekly close above 13740 identifies an evolving MT uptrend. Interim target at 14350. Potential to 15000+ in 2023. 

• Two SOL sector ETFs are unique in that they only include companies positioned upstream. This results in a group of smaller-sized constituents, which can have a greater flow impact.
• Once the universe is established, constituent selection and weight adjustment are determined exclusively using full/float market capitalization. As a result, flow trading can be highly predictable.
• Although they have lower AUM, the five Semiconductor constituents could still face a significant flow impact during this one-day flow event due to their much lower DTV.

• Q1’23 revenues of $6.63 billion, up 6 % YoY, down 2% QoQ
• Q2’23 revenues of $6.15 billion at the midpoint, down 7.2% QoQ.
• Tool push outs and cancellations are spreading to leading logic customers. That’s not a good sign

• Grab Holdings (GRAB US) ’s share price dropped by about 15% despite reported revenue and adjusted EBITDA losses beating consensus estimates.
• Deliveries’ growth has started falling as more people preferring to dine-out. Grab’s incentive optimisation also has contributed to the fall in growth rates.
• Grab’s aggressive ambitions to turn around profitability is a significant downside risk as it will impact growth going forward and force the company to invest back on growth.

• BEKE (Beike) reported 1Q23 revenue 10.4%/12.2% vs our est./cons. non-GAAP net income 65.6%/60.9% higher than our est./cons.
• Although Beike has stated no intention to lower existing home (EH) commission rate, we still expect EH commission rate to slightly trend down in 2023. 
• We maintain BUY rating and raise the TP by US$1 to US$22 to reflect 1) steady recovery of property sales in China; 2) better outlook on profitability.

• We estimate that the re-approval of PUBG Mobile in the India will contribute to a 5% increase in Krafton’s annual revenue/profit.
• Despite being banned in India for several times, PUBG Mobile is expected to receive a warm welcome from local players due to its high quality gameplay and good device compatibility.
• We upgraded our rating to “Buy” in Feb.2023, citing reasons such as PUBG Mobile stabilizing in key markets and Bluehole’s new product schedule. Currently, we remain optimistic view about Krafton

• BABA reported 1Q23 revenue/non-GAAP net income in-line/17.7% vs. cons. International commerce and local services revenues beat our est., while Cloud missed.
• We expect there is still room for margin improvement in FY24. Although Taobao/Tmall will increase spending, the cost savings of other business groups will lead to an overall improvement; 
• We maintain BUY and US$ 109 TP as (1) Douyin’s impact is becoming less significant; (2) International business is growing quickly; and (3) Positive on the effect of separate listing.  

• TME reported 1Q23 results with topline beat our est. by 5.0% and bottom line beat our est. by 25.2%, due to cost-saving measures. 
• As more offline entertainment activities resume after reopening, it would adversely impact both its online music and social entertainment segments. 
• Maintain SELL and cut TP to US$ 6.0 to reflect concert impact and limited catalysts, which implies 12.5X PE in 2023.

The German Bundesrat has finally transposed the legislation regarding whistleblowing after the unexpected delay, allowing EQS to move at full steam to start converting its sales pipeline. The Q123 figures show a good start to the year, despite the hold-up, as the implementation of similar whistleblowing legislation stimulated demand in markets such as Italy and Spain. Revenues (excluding Russia) were up 15% on Q122 and EBITDA margin recovered to 8.5% from 0.9%, putting the group on track to meet its full-year guidance. The shares continue to trade well below the level indicated by our DCF.

• Sea Ltd’s 1Q2023 results showed its ability to sustain profitable growth with a vibrant performance from e-commerce and fintech, offset by slower digital entertainment but with visible stabilisation.
• E-Commerce showed strong performance in Asia, with Brazil making significant progress towards profitability, whilst digital financial services were boosted by a sizable loan book and more diversified funding costs. 
• Sea Ltd continues to demonstrate its cost leadership and ability to expand its total addressable market while sustaining profitability through better infrastructure and user experience rather than pure promotional spending. 

• The main challenge is the construction of new production facilities in the US. The investment amount is estimated to be around ₩1T, achieving an annual production capacity of 100,000 tons.
• The government’s approval is the most significant factor to monitor. It will likely be granted between late June or early July, which is when we should start building positions.
• Due to the local market’s expectation of L&F’s upcoming fundraising event, some traders may start building their positions early on. It’s important to consider this possibility and act preemptively.

• Tencent’s latest financial results are in line with expectations, with revenue and non-IFRS profit of 2.5%/(2.1%) vs cons. While we anticipate weak growth in the gaming sector,
• We suggest that advertising presents several catalysts for Tencent, including the recovery of Ecommerce and gaming, WeChat Video Account’s growth, and inter-connections with Baba and Mihoyo. 
• We maintain a BUY rating with an unchanged target price of HK$433, implying 34X PE in 2023.

• PhilEnergy is offering 2.8 million shares in the IPO and expected market cap range of the IPO is from 279 billion won to 318 billion won. 
• The IPO price range is from 26,300 won to 30,000 won and the total offering amount is 74 billion to 84.4 billion won.
• The company’s core products include stacking and laser notching equipment used in the rechargeable batteries manufacturing process. 

• Tencent (700 HK) reported 1Q2023 results. Revenue grew 10.7% YoY and beat consensus estimate by 2.3% while reported operating profit was 2.25 below consensus estimates.
• Key highlight was the YoY growth in domestic game revenue (+6%) which was mainly driven by strong performance of newly launched titles.
• There has been strong recovery across all business segments during the quarter and current valuations are still at a discount to historical trading multiples and offer a good entry point.

• Ansys managed an all-around beat in Q1 and its results exceeded expectations across all key metrics.
• ANSYS invests in five technology pillars: numerics, high-performance computing (HPC), artificial intelligence (AI), 3D design, and system-level simulation.
• In addition to its investment in numerics, HPC, AI, 3D design, and system-level simulation, ANSYS has been working with key partners to develop new technologies to enhance its capabilities further and bring value to its customers.

• Cainiao Smart Logistics (1437124D HK) ‘s March 2023 quarterly and full-year results can be found within Alibaba’s full-year earnings report, which was released on Thursday May 18
• In both the March quarter and its fiscal year, CaiNiao showed improved Adjusted EBITDA results, though in both periods the tech-centric logistics network still reported losses
• Revenue growth slowed to 18% Y/Y in the March quarter, and parent Alibaba (ADR) (BABA US) indicated CaiNiao will target an IPO in 2024, a bit later than some expected

• It was a successful first quarter for Cognizant Technology Solutions.
• The adjusted operating margin for the first quarter was 14.6%, and the company had quarterly solid bookings growth of 28% YoY.
• We give Cognizant Technology Solutions Corporation a ‘Hold’ rating with a revised target price.

• IQIYI’s 1Q23 top line beat our est. by 8.5%, while its non-GAAP net income beat our est./cons by 95%/82%, largely due to its blockbuster <Knockout>. 
• However, we expect its content pipeline is weaker compared with other key competitors in Q2. 
• Our top and bottom lines in 2Q23 are (3.4%)/(7.4%) vs cons, due to the fierce competition. Maintain SELL and cut TP to US$ 5.0, implying 16.7X PE in 2023.

• Paycom Software had impressive results in the first quarter and managed an all-round beat with revenues of $452 million, up 28% year over year.
• Employee self-service payroll continues to create significant client acquisitions for Beti, which remains a critical difference in the industry.
• We give Paycom Software a ‘Buy’ rating with a revised target price.