In today’s briefing:
- IDX30/LQ45 Index Rebalance: Four Changes for Each Index
- Foosung: Announces a Rights Offering of 101 Billion Won
- AptarGroup Inc: Initiation of Coverage – Cost-Cutting Mastery: How AptarGroup’s Strategic Moves Are Poised to Increased Profits! – Major Drivers
- Evolution Petroleum Corp. -SCOOP/STACK Acquisition Supportive of Dividend Strategy
- Panoro Energy ASA (OSE: PEN): ~45% production growth in 2024
IDX30/LQ45 Index Rebalance: Four Changes for Each Index
- There are 4 changes each for the IDX30 Index and the LQ45 Index at the upcoming rebalance to be implemented at the close on 31 January.
- The largest passive inflows are expected in Indofood CBP Sukses (ICBP IJ), Merdeka Battery Materials (MBMA IJ), Indah Kiat Pulp & Paper (INKP IJ) and Pertamina Geothermal Energy (PGEO IJ).
- With only 4 days to implementation, there could be relatively big moves on stocks that have large flow/impact from passive fund trading.
Foosung: Announces a Rights Offering of 101 Billion Won
- Foosung announced a rights offering worth 101 billion won. The estimated rights offering price is 7,850 won which is 22% discount to closing price on 25 January (10,070 won).
- The rights offering will involve 12.9 million shares (13.7% of outstanding shares). Of the 101 billion won in rights offering, the company will use 88.3 billion won in facility investments.
- We are negative on Foosung overall and on the rights offering. Despite the company’s turnaround this year, there are concerns about share dilution plus valuations are not particularly attractive.
AptarGroup Inc: Initiation of Coverage – Cost-Cutting Mastery: How AptarGroup’s Strategic Moves Are Poised to Increased Profits! – Major Drivers
- This is our first report on Aptar Group Inc., a leading global supplier of consumer dispensing, active packaging and drug delivery solutions.
- In the earnings call, the company reported core sales growth of 2% and double-digit EPS growth of $1.39 per share.
- These successes are largely attributed to high market demand for Aptar’s proprietary pharma dosing and dispensing systems as well as their fragrance dispensing technologies.
Evolution Petroleum Corp. -SCOOP/STACK Acquisition Supportive of Dividend Strategy
- Evolution announced a $43.5 million acquisition of non- operated working interest in the SCOOP/STACK unconventional development play in central Oklahoma on January 9, 2024.
- Our modeling suggests the accretive acquisition supports Evolution’s free cash flow profile and its dividend, which is a critical element of management’s total shareholder return strategy.
- The properties include ~1,550 BOE/d of production from ~230 producing wells on ~3,700 net leasehold acres as of the November 1, 2023, effective date.
Panoro Energy ASA (OSE: PEN): ~45% production growth in 2024
- FY23 production was ~8.5 mbbl/d, implying ~9.5-9.7 mbbl/d in 4Q23.
- The electrical issue at the ESPs on Dussafu has not been fully resolved and continues to negatively impact gross production.
- Valuation We are now forecasting US$85.5/bbl for Brent in 2024 (US$90/bbl previously) and we have paired back our FY24 production forecast from ~13.4 mbbl/d to 12.7 mbbl/d.
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