In today’s briefing:
- Rise of DeepSeek – Impact on SK Hynix and Other Major Korean Stocks
- Memory Monitor: Is DeepSeek a Problem for SK Hynix & Micron’s HBM DRAM Growth?
- Taiwan Dual-Listings Monitor: Dramatic Spreads Open Up After DeepSeek Rout & Taiwan Market Closure
- Bund Center Investment (BTE SP): A Dominant Real Estate Play on the Bund
- The Heat Is On: News Flow and Sentiment in CHINA / HONG KONG (January 25)
- TSMC Forced Underweight, Alibaba Value Trap?
- Azeus Systems (AZEUS SP): Defensive B2B SaaS Developer with Accelerating Growth
- The Beat Ideas: Frontier Springs, A Proxy Play to Capitalizing on Indian Railway Capex Boom
- NVIDIA & The DeepSeek Effect: A Historic $600B Crash But Is This Here To Stay?
- Hyphens Pharma (HYP SP): ASEAN’S Leading Specialty Pharma Company
Rise of DeepSeek – Impact on SK Hynix and Other Major Korean Stocks
- DeepSeek has been the biggest story in the global markets in the past couple of weeks.
- In this insight, we discuss how the rise of DeepSeek could impact the share prices of the major AI related companies in Korea including SK Hynix (000660 KS).
- The top five Korean companies that could be negatively impacted by the rise of DeepSeek include SK Hynix, Hanmi Semiconductor, SK Square, HD Hyundai Electric, and LS Electric.
Memory Monitor: Is DeepSeek a Problem for SK Hynix & Micron’s HBM DRAM Growth?
- SK Hynix Expects 100% HBM Revenue Growth in 2025E After a Massive 2024 — Which Means Traditional DRAM Doesn’t Matter as Much Anymore
- DeepSeek Market Fears — A Problem for HBM & Enterprise SSD Memory?
- AI Industry Opportunities Are Not a Fixed Size Pie — Will DeepSeek Impact HBM DRAM TAM? Why We Don’t Think So
Taiwan Dual-Listings Monitor: Dramatic Spreads Open Up After DeepSeek Rout & Taiwan Market Closure
- TSMC: 10.8% Premium; Taiwanese Investors Likely to Be Less Shocked by DeepSeek News?
- UMC: -7.3% Discount; The Latest Extreme Discount Cannot Be Sustained
- ASE: -10.2% Discount; This Extreme Discount Also Cannot Be Sustained
Bund Center Investment (BTE SP): A Dominant Real Estate Play on the Bund
- Bund Center Investment (BCI) is a diversified investment vehicle with two commercial real estate assets: the landmark Westin Bund Center Hotel, and its premium office space, Bund Center Office Tower in Shanghai.
- BCI operates under two business segments: Hotel Operations and Property Leasing.
- Despite short-term hurdles, long-term economic growth in China provides a supportive backdrop.
The Heat Is On: News Flow and Sentiment in CHINA / HONG KONG (January 25)
- The HSTECH index is trading higher on higher breadth and momentum in January, up 6% so far. Analysts project an upside of 23% over 12 months.
- China’s semiconductor sector is advancing this year from AI enthusiasm and accelerated localization in the chip industry. Semiconductor Manufacturing International Corp (SMIC) (981 HK) shares have benefited from this trend.
- Sunny Optical Technology Group (2382 HK) benefits from China’s announcement that it will subsidize more consumer products, including smartphones and new vehicles.
TSMC Forced Underweight, Alibaba Value Trap?
- TSMC hit a record high average fund allocation of 9.07% at the end of last year, yet EM funds switched to a sizeable underweight of -1.47% throughout the year.
- Active UCITS funds become forced sellers as weights hit 10%, with non-UCITS selling in to strength as weights rise on strong performance.
- EM Value funds maintain an overweight in Alibaba, the only Style group to do so. Alibaba is now the most widely held stock for Value funds alongside TSMC and Samsung.
Azeus Systems (AZEUS SP): Defensive B2B SaaS Developer with Accelerating Growth
- Azeus Systems Holdings Ltd. (SGX: AZEUS SP) is a leading global IT solutions provider with over 30 years of experience, specializing in board governance and digital transformation solutions. The company’s flagship product, Convene, serves boardrooms and executive teams across more than 100 countries, with additional offerings like Convene AGM, Convene Records, and Convene ESG, tailored to meet specific enterprise needs.
- Two Business Segments: Azeus Products and IT Services. These segments cater to a diverse clientele with tailored solutions that address specific operational and strategic needs of Azeus’s clients. Azeus Products account for the lion’s share of revenue, at 81% as shown below.
- Convene Flagship Product: Convene is a leading board governance solution for boardrooms and executives, offering secure document sharing, real-time collaboration, voting tools, analytics, and workflow automation to streamline decision-making. Its user-friendly interface and mobile compatibility make it popular among enterprises and governments. Azeus also offers additional Convene-branded products for specific use cases.
The Beat Ideas: Frontier Springs, A Proxy Play to Capitalizing on Indian Railway Capex Boom
- Frontier Springs (FS IN) is poised for growth, driven by India’s robust railway sector expansion and increased demand for LHB coaches which is reflected in their expanding margins and profitability.
- Company is aiming for 250Cr by FY25 and 500Cr by FY27 with sustainable margins for 18-20%.
- Company is completely booked for next 6-8 months and air spring division is booked completely for next year. Also looking for acquisition in the segment.
NVIDIA & The DeepSeek Effect: A Historic $600B Crash But Is This Here To Stay?
- NVIDIA, the global leader in AI hardware, has recently faced unprecedented turbulence in the market, shedding nearly $600 billion in market capitalization in a single day—an event that has sent shockwaves through the tech and investment communities.
- The catalyst for this dramatic drop?
- DeepSeek, a relatively new Chinese AI startup that has stunned the industry by developing a highly efficient and cost-effective AI model, DeepSeek R1.
Hyphens Pharma (HYP SP): ASEAN’S Leading Specialty Pharma Company
- Hyphens Pharma (HYP SP EQUITY) is Singapore’s leading specialty pharmaceutical and consumer healthcare group, leveraging on its diverse footprints in ASEAN countries. Its core business lies in three segments: Specialty Pharma Principals, Proprietary Brands, and Medical Hypermart and Digital.
- Based on its scalable business model, direct access to the five countries in the southeast Asia region enabling it to capture health expenditure growth in ASEAN countries, sustainable growth from both in-house product innovation and in-licensing cooperation, as well as realization of DocMed’s potential when rolling out the digital platform to other ASEAN markets, Hyphens Pharma will demonstrate sustainable growth momentum and optimistic investment value in the future.
- Revenue in 2024 full year is expected to show a strong rebound compared to 2023.
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