In today’s briefing:
- DeepSeek and Market Over-Reaction. Nvidia, Broadcom, Marvell, TSMC, SK Hynix
- India Food Delivery | Old Habits Die Easy
- China Consumption Weekly (27 Jan 2025): Alibaba, JD.com, Kuaishou, NIO, Honor, Apple
- Fanuc (6594) | Robots in Reverse
- Asian Dividend Gems: Cosco Capital
- Macrotech Developers : Decoding Family Feud and Corporate Governance Overhang
- How Taiwan Semiconductor (TSMC) Is Betting Big on AI & Winning The Global Chip Race!
- Japan Business Systems (5036 JP) – Aiming to Be Japan’s No.1 Cloud Integrator
- Fastenal Company: Expanding Onsite & Branch Sales Strategy To Up Their Game! – Major Drivers
- Duplicate of CSX Corporation: A Hurricane-Hit Performance But Fundamentals Remain Strong! – Major Drivers
DeepSeek and Market Over-Reaction. Nvidia, Broadcom, Marvell, TSMC, SK Hynix
- This reports addresses the alarmist wrong conclusions over DeepSeek, especially over GPU usage and costs
- This said, DeepSeek shows that Foundational models are commoditizing. Applications will be more resilient and profitable, ie customized with attached services
- We are just at the beginning of the AI revolution with language models. Physical models are next and massive Application deployment.
India Food Delivery | Old Habits Die Easy
- Gen Z consumers prioritize price over brand loyalty, affecting restaurateurs’ pricing strategies.
- Increasing platform dominance and discounting culture hinder profitability for restaurants in the competitive food delivery landscape.
- Food delivery companies are pivoting from mere consumer tech-enabled logistics businesses to data-driven market-dominant behemoths.
China Consumption Weekly (27 Jan 2025): Alibaba, JD.com, Kuaishou, NIO, Honor, Apple
- Consumers accused that Alibaba and JD.com took national consumption subsidies.
- Kuaishou’s new year sales GMV (Gross Merchandise Value) increased by 71%.
- Honor Smartphone CEO resigned largely due to the IPO plan.
Fanuc (6594) | Robots in Reverse
- Consolidated net sales slipped 0.4% to ¥197 billion, while operating income slipped 14.6%, hitting ¥34.9 billion
- The yen’s Q3 weakness erased ¥11 billion in unrealised inventory profits, dragging reported operating profit below expectations
- Recovery in order book is key positive. However, given the stock’s outperformance over the past 3 months, there is less upside.
Asian Dividend Gems: Cosco Capital
- Cosco Holdings’ stakes in Puregold Price Club and The Keepers Holding is worth US$1.1 billion, which is 176% higher than Cosco’s current market cap.
- Cosco Capital’s dividend yield and dividend payout have been increasing nicely in the past several years from 1.5% in 2021 to 3% in 2022 and 8.8% in 2023.
- We found Cosco Capital using Smartkarma’s Smartscore Screener. We used three criteria including market cap, dividend score of 4 or more, and total SmartScore of 4 or more.
Macrotech Developers : Decoding Family Feud and Corporate Governance Overhang
- The Lodha brothers, Abhishek and Abhinandan, are locked in a legal battle over the use of the “Lodha” brand, despite a 2017 family settlement agreement.
- Macrotech Developer is seeking a perpetual injunction against HoABL to cease the use of the “Lodha” brand in any form and is demanding INR5,000 crore in damages.
- The Bombay High Court on January 21 said that it would hear on January 27 the application filed by Abhishek Lodha-promoted Macrotech Developers Ltd
How Taiwan Semiconductor (TSMC) Is Betting Big on AI & Winning The Global Chip Race!
- Taiwan Semiconductor Manufacturing Company (TSMC) closed 2024 on a high note, driven by robust demand for AI-related chips and its cutting-edge 3-nanometer and 5-nanometer technology nodes.
- The world’s largest contract chipmaker reported a record fourth-quarter net profit of NT$374.68 billion (US$11.37 billion), marking a 57% year-over-year increase, alongside a 39% revenue jump to NT$868.46 billion.
- The company’s gross margin rose to 59%, supported by high demand for advanced nodes despite challenges like ramp-up costs for its overseas facilities in the U.S. and Japan.
Japan Business Systems (5036 JP) – Aiming to Be Japan’s No.1 Cloud Integrator
- In the Company’s stated goal aiming to become the No.1 cloud integrator in Japan, the importance of its close relationship with Microsoft cannot be overstated.
- JBS became certified as a Microsoft Partner in 1995, and it was awarded Microsoft Japan Partner of the Year for the first time in 2007.
- JBS has been recognized as Microsoft Japan Partner of the Year for 12 consecutive years from 2013 – 2024, reflecting its business strategy to focus on cloud migration/integration during that period.
Fastenal Company: Expanding Onsite & Branch Sales Strategy To Up Their Game! – Major Drivers
- Fastenal Company recently held its 2024 annual and fourth-quarter earnings call, providing insights into its financial and operational performance.
- The company reported a modest fourth-quarter sales growth of 3.7% (2.1% on a daily sales rate), indicating a stabilization in sales amidst a challenging industrial economy.
- Although sales grew slightly, the company did not meet its own expectations, with earnings per share (EPS) decreasing by 2% to $0.46.
Duplicate of CSX Corporation: A Hurricane-Hit Performance But Fundamentals Remain Strong! – Major Drivers
- The CSX Corporation’s earnings reveal a complex landscape influenced by numerous external factors, while also showcasing internal resilience and growth initiatives.
- For the fiscal year 2024, CSX faced a multitude of challenges, including adverse weather events like hurricanes, weaker commodity prices, and infrastructure disruptions, notably the collapse of the Francis Scott Bridge.
- These external pressures led to fluctuations in financial performance, especially in specific segments like coal and intermodal transportation.
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