In today’s briefing:
- China Rare Earth (769 HK)’s Wild Price Movement. An Offer In The Wings?
- Nippon Steel (5401 JP) – No Rival, No Discount, Limited Control
- Copper Crunch Deepens: China’s Inventory Collapse Reshapes Global Market
- New World Resources (NWC AU): CAML Bumps. Shares To Be Placed. Kinterra Taps Takeover Panel
- AMMN.IJ – Smelter Ramp-Up Underway, Elang Optionality in Focus, Valuation Reflects Long-Term Upside
- Hong Kong Oil Stocks: Surge in Oil Volatility Creates Opportunity
- Stora Enso: Hidden Forest Value Unlock With a Clean Break Catalyst
- Allegheny Technologies Incorporated (ATI): Aerospace & Defense Sector Growth To Bolster Its Position & Capitalively Grow In Critical Markets!
- Riding the energy transition wave
- SSAB- Game-Changing Product Mix & Regulatory Edge Propel Long-Term Upside!
China Rare Earth (769 HK)’s Wild Price Movement. An Offer In The Wings?
- China Rare Earth Holdings (769 HK), a processor and trader of rare earth oxides/metals, is suspended for reasons unknown.
- But not before gaining 79% month to date. On huge volume. And that gain is after giving back 23% from a recent high close.
- As discussed in Know Your Rare Earth Elements As China Restricts Exports, China recently escalated restrictions on the export of rare earths; although there has been some partial easing.
Nippon Steel (5401 JP) – No Rival, No Discount, Limited Control
- Nippon paid full price despite governance restrictions; with no credible rival, rejecting the golden share risked collapsing the deal.
- Historical golden share precedents imply 10–20% valuation discounts, yet Nippon accepted late-stage constraints without renegotiation.
- Funding mix includes bridge loans, hybrids, and asset sales, but proposed equity issuance near 40% below book risks EPS dilution and undermines capital discipline messaging.
Copper Crunch Deepens: China’s Inventory Collapse Reshapes Global Market
- Chinese copper inventories have dropped to 15-year seasonal lows, with SHFE stockpiles plunging 60% in April — the sharpest decline on record.
- This signals intense physical market tightness, driven by strong demand and smelter cutbacks.
- The trend is reinforcing bullish sentiment, tightening global balances, and spurring strategic moves across the copper supply chain.
New World Resources (NWC AU): CAML Bumps. Shares To Be Placed. Kinterra Taps Takeover Panel
- Central Asia Metals (CAML LN) has bumped terms for New World Resources (NWC AU) to A$0.053/share, up from A$0.05/share initially. An off-market Offer is in parallel should the Scheme fail.
- Separately, NWC announced a A$10mn placement – funded by CAML! – to advance its Antler Project, “conditional on either no competing proposal being received by …. 4 July 2025“.
- Toronto-Based PE outfit Kinterra Capital, with a 11.99% stake, has now tapped the Takeovers Panel to declare the placement a frustrating tactic.
AMMN.IJ – Smelter Ramp-Up Underway, Elang Optionality in Focus, Valuation Reflects Long-Term Upside
- Q1 2025 results reflected a transitional quarter with lower grades, but FY2025 guidance was maintained.
- Ongoing investments in smelter ramp-up, power infrastructure, and long-term plans for Elang underscore AMMN’s integrated growth strategy.
- Valuations appear premium vs peers, but are partly justified by structural cost advantages, downstream leverage, and world-class Elang optionality—though single-asset exposure remains a key risk.
Hong Kong Oil Stocks: Surge in Oil Volatility Creates Opportunity
- Oil has surged on geopolitical headlines, with a sharp increase in both price and implied volatility.
- Implied vols in Hong Kong-listed oil names have lagged sharply behind the move in Oil.
- The relative dislocation in volatility opens the door to tactical pair trade and hedging ideas.
Stora Enso: Hidden Forest Value Unlock With a Clean Break Catalyst
- Forest spin-off could unlock €2.2bn in hidden NAV and enhance valuation transparency, but will not reduce debt as shares are distributed directly to shareholders.
- Industrial operations are undervalued vs peers, providing cyclical recovery upside.
- Sum-Of-The-Parts (SOTP) path simplification addresses conglomerate discount and improves investor transparency.
Allegheny Technologies Incorporated (ATI): Aerospace & Defense Sector Growth To Bolster Its Position & Capitalively Grow In Critical Markets!
- ATI reported robust first-quarter financial results for 2025, showing continued strong momentum.
- Revenue grew by 10% year-over-year, reaching approximately $1.14 billion, mainly driven by high demand in aerospace and defense (A&D).
- The company’s adjusted EBITDA of $195 million exceeded expectations, with adjusted earnings per share also surpassing the top of guidance.
Riding the energy transition wave
- Provaris Energy Ltd (PV1.ASX) represents an unique investment opportunity as a leveraged play on the growing shift to alternative energy and carbon reduction, particularly in Europe, but applicable on a global basis.
- The keystone to production and growth is proprietary ‘storage tank’ IP, enabling bigger volumes of compressed hydrogen to transport at lower cost (‘more for less’).
- The company holds a material early-mover advantage with strategic partnerships and supply, offtake and shipping agreements expected to become unconditional over the next 12 months into 2026.
SSAB- Game-Changing Product Mix & Regulatory Edge Propel Long-Term Upside!
- SSAB, a prominent player in the global steel industry, presented its first-quarter 2025 results, providing investors with a snapshot of its operational and financial landscape.
- The company has maintained a commendable safety record, which remains a top priority across its operations.
- The quarter’s financial performance delivered an operating result of approximately SEK 1.3 billion, aligning with expectations.
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