In today’s briefing:
- CES China Semiconductor Chips Index Rebalance Preview: Multiple Adds for Some Stocks Increase Flow
- Steel Pipe Industry of Indonesia (ISSP IJ) – Piping Hot
- Birla Opus | Short Term Gain, Long Term Pain
- VRG Leads Rubber Growth Across Laos Plantation Heartlands
- Running on Fumes: Wood Group’s Last Shot with Sidara
- Steel Authority of India: Weak on Expansion
- How Commodities React To Trumps New Global Trade Plans
- Upslope’s Quarterly Investor Letter: 2025-Q1
- [US Crude Oil Options Weekly 2025/15] WTI Pauses Slide on Tariff Delay
- [US Nat Gas Options Weekly 2025/15] Henry Hub Dropped Amid Trade Turmoil and Warmer Forecasts
CES China Semiconductor Chips Index Rebalance Preview: Multiple Adds for Some Stocks Increase Flow
- There could be three changes for the CES China Semiconductor Chips Index at the close of trading on 13 June.
- Based on the assets tracking the index, passive trackers will need to trade between 0.1-0.4x ADV in the stocks.
- Bestechnic Shanghai (688608 CH) and Suzhou Kematek (301611 CH) will also have net inflows from passive trackers of other indices at the same time, adding to the flow.
Steel Pipe Industry of Indonesia (ISSP IJ) – Piping Hot
- Steel Pipe Industry of Indonesia (ISSP IJ) is Indonesia’s largest steel pipe manufacturer with over 2,000 customers and exposure across diverse sectors, including infrastructure, autos, and Oil & Gas.
- The company looks set to book strong growth in revenues and profits over the next 3 years, driven by increased capacity and improving product mix towards higher value products.
- SPINDO has been shifting towards longer duration funding and reducing interest costs. Valuations are attractive on a 3x FY2025E PER, with a forecast dividend yield of 5%.
Birla Opus | Short Term Gain, Long Term Pain
- We interact with our dealer network representing Asian Paints (APNT IN) and Birla Opus Grasim Industries (GRASIM IN) dealers with an objective to understand the current operating environment.
- Aggression in a slow-moving market will result in short-term market share gains for players like Birla Opus.
- While Asian Paints (APNT IN) may appear to lose market share, we believe this would be transient in nature.
VRG Leads Rubber Growth Across Laos Plantation Heartlands
- VRG’s Lao division scripts US$14.85 million in profit in 2024
- VRG’s rubber output in Laos touches 34,592 tons in 2024
- Prime Minister asks VRG to start tire units in Laos
Running on Fumes: Wood Group’s Last Shot with Sidara
- Sidara’s 35p offer provides a 40% premium with no dilution, offering certainty and urgently needed capital, making it the most favorable path for shareholders amid financial distress.
- A standalone capital raise of £342m at 20p would dilute existing shareholders by over 71%, highlighting the severe downside if the Sidara deal collapses or fails regulatory approval.
- Having rejected Apollo’s 240p offer in 2023, the Board is now recommending a 35p bid—an 85% discount—after destroying credibility, mismanaging cash, and losing shareholder trust.
Steel Authority of India: Weak on Expansion
- SAIL has been a consistent under-performer despite having huge iron ore reserves, multi-location steel plants and wide product spectrum and exclusive sales to Indian Railways
- Legacy plants, ageing manpower and operational inefficiencies have resulted in slower growth compared to peers and a significant loss in overall market share, high inventories and single digit RoEs
- SAIL trades at 0.8x P/B, in line with history, but weak volume visibility and elevated debt warrant a deeper discount—0.6x book better reflects risk-reward, in our view.
How Commodities React To Trumps New Global Trade Plans
- President Trump triggered turmoil in the stock and bond markets, sent shockwaves through the global economy, and claimed the U.S. would eliminate the national debt using trillions supposedly generated from his tariffs.
- Just earlier this week, he declared he wouldn’t make a zero-tariff deal with the EU — and now, without any real change in circumstances, he’s suddenly starting to back down.
- Trump dropped his country-specific tariffs down to a universal 10% rate for all trade partners except China on Wednesday – for a limited time period of 90 days – presumably to have more time to make deals with each country.
Upslope’s Quarterly Investor Letter: 2025-Q1
- Q1 was challenging. However, in the two weeks since Mar 31, the world has changed, owing to an intense realignment of global trade policies.
- This has swiftly aligned markets more with Upslope’s portfolio and approach.
- April-to-date performance1 has been strong (approx. +7%), leaving the Fund +2% YTD (vs. -12% for the S&P Midcap 400).
[US Crude Oil Options Weekly 2025/15] WTI Pauses Slide on Tariff Delay
- WTI futures fell 0.8% for the week ending 11/Apr, driven primarily by uncertainty around tariffs and escalating trade tensions between the U.S. and China.
- The U.S. rig count fell by seven to 583. The oil rig count dropped by nine to 480, while gas rigs grew by one to 97.
- WTI OI PCR fell to 0.80 on 11/Apr compared to 0.88 on 04/Apr. Call OI increased by 19.3% WoW, while put OI grew by 9.1%.
[US Nat Gas Options Weekly 2025/15] Henry Hub Dropped Amid Trade Turmoil and Warmer Forecasts
- For the week ending 11/Apr, U.S. natural gas prices fell by 8.1% on the back of escalating U.S.-China trade tensions and warmer weather forecasts.
- U.S. natural gas futures sharply fell on 08/April (Tue) and touched an eight-week low despite robust LNG exports.
- Henry Hub OI PCR fell to 0.95 on 11/Apr compared to 0.97 on 04/Apr. Call OI increased by 6.3% WoW, while put OI grew by 3.8%.
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