In today’s briefing:
- SK HYNIX (000660 KS / SKHY US): Solidigm’s Value Just Quadrupled, According to Reuters
- Tongda (698): Real Monetization Potential
- Edelweiss: Making the Right Moves | EAAA IPO by Q3FY27
- The Relay Behind Microsoft’s 17-Bagger: How to Find the Next Nadella
- Freee (4478 JP) | Margins Now, Cash Later
- Magellan Financial (MFG AU) Vs Credit Corp (CCP AU): Proven but Risky Pair Signals Again
- Monthly Chinese Tourism Tracker | August Traffic Resilient, Especially Domestic Air Activity
- Kolte Patil: All Set for a Strong FY27
- Japan: Relative Value Opportunities and Pair Trades (28 Sep 2026)
- Cafe De Coral (341): Still Value
SK HYNIX (000660 KS / SKHY US): Solidigm’s Value Just Quadrupled, According to Reuters
- Reuters: Solidigm weighs IPO up to $150bn, ~$15bn raise, 2027 listing — 4x the KRW50T figure our August stub-value thesis modeled, but single-sourced and unfiled.
- Re-Run SOTP: Solidigm optionality lifts Fair Value by ₩324,000/share to ₩3,024,000, up 12% from our current TP of ₩2,700,000.
- We keep our Fair Value unchanged. This confirms our 40%-probability base case rather than surprising it. The SKHY rose by ~3% on Friday, a good sign it will rise today.
Tongda (698): Real Monetization Potential
- The management of Tongda Group (698 HK) has decided to focus on the growth of its subsidiary, Tongda smart tech, thus less dependant on smart phone replacement cycle.
- The subsidiary generated ~30% of the parent’s revenue but contributed to most of the parent’s operating profit.
- Although the valuation gap presents a real arbitrage opportunity with the HK listed present a deep discount, the key lies in the not-so-difficult monetization potential to realize the gap.
Edelweiss: Making the Right Moves | EAAA IPO by Q3FY27
- Edelweiss’ asset management businesses continue to scale up rapidly and lead the profitability. The Alternatives business (EAAA) is on track to complete its IPO by Q3FY27.
- The insurance businesses are on track to breakeven during FY27 as per the earlier guidance. Motor insurance business in particular is scaling up rapidly for Edelweiss.
- With consistent scaling up and value unlocking, Edelweiss is making the right moves. At current valuation, an investment in it has potential to double over a holding period of 3Y.
The Relay Behind Microsoft’s 17-Bagger: How to Find the Next Nadella
- Microsoft’s 17× under Satya Nadella was a double play: EPS rose about 6.6× while the P/E more than doubled from a value-trap 13.8×.
- It was a relay: the Ballmer era built the enterprise channel and incubated Azure; Nadella removed the anchors and redirected capital toward cloud and AI.
- The next setup pairs a re-founder with an inherited distribution channel and an unpriced option; IBM had a franchise and an insider CEO but lacked the option and the reallocation.
Freee (4478 JP) | Margins Now, Cash Later
- Margins are the near-term catalyst: Hiring drops sharply, supporting guided adjusted operating-margin expansion from 11% in FY6/27 to 15.5% in FY6/28.
- Corporate Mid drives growth: ARR grew 27.2%, supported by accounting-firm distribution, while AI and embedded finance provide additional potential upside.
- Cash conversion is the key risk: Adjusted profit masks SBC, capitalised software and card funding; weak FCF could undermine valuation if AI pressures margins.
Magellan Financial (MFG AU) Vs Credit Corp (CCP AU): Proven but Risky Pair Signals Again
- Context: The Credit Corp (CCP AU) vs. Magellan Financial (MFG AU) price ratio has deviated more than two standard deviations from its one-year average, presenting a potential relative value opportunity.
- Highlight: Going long Magellan Financial (MFG AU) and short Credit Corp (CCP AU) targets a 13% return.
- Why Read: Essential for quantitative traders seeking mean-reversion opportunities, with detailed execution framework, risk management protocols, and historical simulation showing the statistical basis for this relative value play.
Monthly Chinese Tourism Tracker | August Traffic Resilient, Especially Domestic Air Activity
- August air activity largely matched July’s improved pace of growth (versus weak Q2)
- The improvement in domestic activity has been more dramatic than in outbound
- Effectively, high fuel costs appear to be keeping travelers closer to home here in Q3
Kolte Patil: All Set for a Strong FY27
- Kolte Patil after going through a transition phase post the ownership and leadership change, after onboarding of Blackstone as a strategic shareholder, is on track to perform strong in FY27.
- As the rumors had suggested and as we had highlighted in our previous note, the new CEO, Hrishikesh Parandekar, joined effective Aug 24 2026.
- Led by the new leadership and organizational structure, Kolte Patil is seeing accelerated growth across all fronts – pre-sales and launches, deliveries and business development.
Japan: Relative Value Opportunities and Pair Trades (28 Sep 2026)
- Context: This Insight follows up on previously highlighted relative value opportunities, using a statistical methodology based on mean-reversion to identify opportunities in paired securities.
- Highlights: In Japan, currently three pair trade opportunities persist across three sectors.
- Why read: Statistical analysis offers a unique perspective on relative value. Gain insights into actionable statistical pair trade opportunities and monitor performance of previously highlighted pairs.
Cafe De Coral (341): Still Value
- Share buyback, dividend increase to 30 cents, yielding around 7.6% with PBR 1x and 0.4x price to sales are good catalysts to own Cafe de Coral (341 HK) .
- Greater Bay connectivity provides an opportunity to expand margin as the cost is lower, as well as to capture customer leakage when HK residents travel to China over the weekend.
- Cafe de Coral (341 HK) benefits from the economic downturn when customers pull back from premium dining.
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