Daily Brief Energy/Materials: Tung Ho Steel Enterprise, Zijin Gold, DuPont, Base Oil, Crude Oil, Emdeki Utama PT, Rajshree Polypack, Tpi Polene Public and more

• The TDIV index tracks the top 50 names in the Taiwan Stock Exchange with the highest dividend yields. It is a yield-weighted index with unique capping rules.
• There were some key methodology changes announced for this index yesterday.
• In this insight, we take look at Quiddity’s expectations for index changes and capping flows for the TDIV Index for the December 2025 index rebal event.

• Zijin Mining Group is a leading global mining company with a significant presence in gold, copper, and zinc production. The company is strategically focused on expanding its international footprint through acquisitions and organic growth, particularly in gold and copper.
• The company is capitalizing on high commodity prices, especially for gold, to fuel its growth and is undertaking a significant corporate action by spinning off its international gold assets into a separately listed entity, Zijin Gold, in Hong Kong to attract global investors.
• While demonstrating strong financial performance and production growth, the company faces challenges related to geopolitical risks, resource nationalism, and the inherent volatility of commodity markets. A key focus for the future is balancing its aggressive expansion with sustainable and responsible mining practices.

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• DuPont (DD) is set to spin off 100% of its Electronics business, Qnity (Q), in early November.
• Qnity is positioned to grow in line with the semiconductor industry, which is expected to expand at a mid-single-digit CAGR.
• A large portion of its portfolio consists of consumable products, supporting strong profitability with EBITDA margins around 30% (inclusive of ~$100 million in public company costs).

• US light-grade base oils domestic prices weaken versus feedstock/competing fuel prices; export price-differentials hold firmer.
• Diverging trends reflect weaker outright prices for domestic supplies and firmer prices for export volumes.
• Premium of Group II domestic light-grade base oils prices over export prices falls in response to narrowest level in more than two months.

• Crude oil futures extended early-week losses Tuesday as concerns over a Q4 supply glut took hold, with sluggish demand growth seen unable to match growing supplies from OPEC+.
• Dec25 ICE Brent  futures were trading at  $66.21/b (2030 BST) versus Monday’s settle of $67.09/b, while Nov25 NYMEX WTI  was at  $62.57/b against a previous close of $63.45/b.
• The latest retreat also came after Bloomberg reported that OPEC+ could unwind an additional 1.5 million bpd over the next three months , with the option said to be under consideration.

• Dominant Market Position with Caveats: As the sole producer of calcium carbide in Indonesia, Emdeki Utama holds a strategic position. However, the company faces significant competition from cheaper imports, particularly from China, which pressures pricing and profitability.
• Challenging Financial Performance: The company has experienced a notable decline in revenue and net income over the past three years, with negative growth rates across key metrics. While recent quarters show some margin improvement, the overall trend points to significant headwinds.
• Attractive Valuation but High Uncertainty: Trading at a low Price-to-Book ratio, the stock appears undervalued. This is balanced by a high uncertainty rating, driven by volatile financial performance, reliance on a single core product, and intense competition from imports.

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• Despite early monsoon resulting in weak demand, RPPL posted a decent revenue growth of 4.9% YoY in Q1FY26. This was led by 45% YoY growth in exports.
• RPPL’s injection molding segment has been doing exceptionally well with revenue doubling in Q1FY26. RPPL’s Olive Ecopak JV has started slow but holds significant potential.
• At current valuation, RPPL’s stock offers an attractive entry point with potential to more than triple over a holding period of three years. 

• TPI Polene (TPIPL) is Thailand’s third-largest cement manufacturer, with diversified operations in petrochemicals, energy, and agriculture. The company is strategically pivoting towards sustainability, emphasizing ‘green’ cement and expanding its waste-to-energy power generation, which is expected to improve margins and reduce environmental compliance risks.
• The company faces significant headwinds from a highly concentrated domestic cement market and intense competition in the regional petrochemical sector. Financial performance has deteriorated over the past three years, marked by declining revenues, shrinking profitability, and negative free cash flow, reflecting challenging market conditions and cost pressures.
• Forward-looking growth is contingent on the successful execution of its green transition strategy and the pace of Thailand’s public infrastructure spending, particularly in the Eastern Economic Corridor (EEC). While the valuation appears inexpensive on a price-to-book basis, significant uncertainty surrounds the timing and magnitude of an earnings recovery.

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• Asia’s base oils prices slip versus gasoil prices amid recent rise in crude oil prices.
• Heavy-grade base oils margins stay relatively firm even with recent downward pressure.
• Recent squeeze on margins could prompt refiners to resist price-adjustments to reflect any change in supply-demand fundamentals.

• US base oils demand could ease amid expectations of ready availability of supply and steady-to-lower prices.
• US demand typically rises in month of October from September before slowing in month of November.
• Typical rise in demand in month of October would coincide with major plant shutdown for scheduled maintenance work.