Daily Brief Australia: PointsBet Holdings , Pilbara Minerals, Aft Pharmaceuticals, Jindalee Lithium and more

• PointsBet Holdings (PBH AU) has disclosed a revised Mixi Inc (2121 JP) offer at A$1.20, a 13.2% premium to the previous A$1.06 offer and a 10.6% premium to last close. 
• Due to Betr’s 19.9% stake, which can effectively block Mixi’s scheme, Mixi will consider an off-market takeover offer of A$1.20 with a 50.1% minimum acceptance condition. 
• Mixi’s revised offer is superior to Betr’s if synergies are not factored in. While the Betr’s all-cash offer is equivalent to Mixi’s, it is subject to scale-back.

• With the review period complete, we forecast no inclusions to the index in June. There could be up to 3 deletions at the review though.
• Even if there are no constituent changes, capping changes will lead to one-way turnover of 3.9% and a round-trip trade of A$216m.
• Pilbara Minerals is a potential deletion from the S&P/ASX 50 Index with implementation on the same date. Shorts have been covering but short interest is a big percentage of float.

• Back on the 26th Feb, PointsBet (PBH AU), an Australian/Canadian online wagering platform, entered into a Scheme Implementation Deed with MIXI (2121 JP), at $1.06/share, a 27.7% premium to undisturbed.
• An approach from BETR Entertainment (BBT AU), PointsBet’s key rival, was initially rebuffed. On the 12th May, both parties subsequently entered into mutual due diligence after Betr finagled terms.
• MIXI has now bumped terms to A$1.20/share. The Scheme Meeting has been delayed to the 25th June. DD continues to be carried out by PointsBet and Betr.   

AFT Pharmaceuticals reported FY25 revenues of N Z$208m, posting a strong recovery in H2, with dissipating headwinds and traditional H2 seasonality offsetting the softer H1 performance. H225 revenues (N Z$121.3m) grew 40% over H125 and 9% y-o-y, driven by sustained domestic market momentum and international market recovery. The FY25 operating margin of 8.5% (12.4% in FY24) was affected by lower licensing income and investments in marketing, R&D and international expansion, but these investments should deliver upside opportunities in the longer term. The balance sheet remains strong (net debt reduced to N Z$14.5m, 0.7x EBITDA), supporting the announcement of a 1.8c per share dividend (c 17% payout ratio). Management aims to achieve N Z$300m in revenues by end-FY27 and has guided for operating profit of N Z$20–24m in FY26, with increased operating leverage in the medium term. We update our valuation for AFT to N Z$691.4m or N Z$6.59/share, from N Z$697.4m or N Z$6.65/share previously.

• Lithium price recovery is a matter of when, not if. Lithium prices that peaked in 2022 at ~$80/kg on heavy inventory build, driven by supply chain concerns, and subsequently collapsed to $8-10/kg, due to oversupply and the slower uptake of EVs in the US and Europe, could begin to recover, perhaps as early as next year.
• This takes into account that 40% of the industry is operating at a loss in the current price environment and demand for the metal remains robust, with energy storage markets growing 65% Y/Y and EVs growing 29% Y/Y in 1Q25.
• China’s role in mining and dominance in processing.