In today’s briefing:
- SMIC (981.HK): 2Q25 Guidance Shows A -5% in Revenue. Could This Reflect the Impact of US Tariffs?
- Telegram from Srinagar | Operation Sindoor – On Ground Update
- HK Inno. N (195940 KS): Promising US Trial Result for K-CAB Raises Hope; Starts 2025 on Strong Note
- Cleveland-Cliffs: Weak Q1 Results, Restructuring Underway, Valuations Reflect Deep Discount
- F&F: A Key Beneficiary of Explosive Popularity of Jung Hoo Lee (Grandson of the Wind) In the MLB
- Panache Digilife : Forensic Analysis
- [Earnings Review] Occidental Beat EPS Expectations on Strong Oil & Gas Performance
- Japanese Big Cap Banks – Focusing on Strategic Equity Holdings as BoJ Likely to Defer Rate Hikes
- CXW: 1Q25 Highlights
- Melco Holdings (6676 JP): Full-year FY03/25 flash update
SMIC (981.HK): 2Q25 Guidance Shows A -5% in Revenue. Could This Reflect the Impact of US Tariffs?
- Semiconductor Manufacturing International Corp (SMIC) (981 HK)‘s 1Q25 results were in line, while the 2Q25 guidance appears somewhat cautious.
- The Americas continued to contribute a low-teens percentage to revenue, accounting for 12.6%, while China and Eurasia made up the remaining majority.
- Semiconductor Manufacturing International Corp (SMIC) (981 HK)’s top priority remains its strategic focus on core business and near-term execution.
Telegram from Srinagar | Operation Sindoor – On Ground Update
- We interact with local business owners and our channels in Srinagar, Jammu and Kashmir with an objective to understand the current sentiment on the ground.
- Srinagar, Kashmir’s summer capital, remains strategically vital in the current conflict as a military hub and political flashpoint between India and Pakistan.
- Local business owners are hopeful that the escalating conflict and the media attention surrounding it will ease by the 10th of May.
HK Inno. N (195940 KS): Promising US Trial Result for K-CAB Raises Hope; Starts 2025 on Strong Note
- HK inno.N (195940 KS) announced positive topline result from the U.S. Phase 3 trial evaluating K-CAB in gastroesophageal reflux disease. U.S. filing is expected in 4Q25.
- HK inno.N has reported strong 1Q25 result, with double-digit growth across all key parameters. Revenue increased 16% YoY, while operating profit grew at a faster pace of 47% YoY.
- The U.S. filing and approval are the major catalysts. However, HK inno has other growth engines as well. Innovative pipeline is also progressing, ensuring long-term growth prospect.
Cleveland-Cliffs: Weak Q1 Results, Restructuring Underway, Valuations Reflect Deep Discount
- EBITDA loss of $174M, net loss of $483M, driven by weak auto demand, high costs, and continuing drag from AMNS slab contract; EBITDA/ton fell sharply to –$42.
- Idling six facilities, exiting loss-making operations, $300M cost savings targeted in H2; slab contract expiry to add ~$500M EBITDA annually from 2026.
- Deep value: Trading at 4.4x EV/EBITDA (2026E), 7.1x P/E, 0.55x P/B, and $653 EV/ton of full steelmaking capacity, reflecting deep cyclical pessimism.
F&F: A Key Beneficiary of Explosive Popularity of Jung Hoo Lee (Grandson of the Wind) In the MLB
- F&F is one of the key beneficiaries of the exploding popularity of Jung Hoo Lee in the MLB (Major League Baseball) in the United States.
- The surging popularity of Jung Hoo Lee could lead to higher demand for F&F’s core products (MLB baseball caps and apparel products), which could lead to higher sales and profits.
- F&F recently provided new shareholder return plans including providing at least 25% of net profit as dividends/buybacks/cancellations (including buyback at least 60 billion won from 2025 to 2027).
Panache Digilife : Forensic Analysis
- Panache DigiLife Limited is an ICT & IoT devices design, manufacturing, distribution and services company.
- Company’s accounting policy for non-provisioning of old receivables seems to be aggressive. Poor capital allocation resulted in fragile financial health.
- Concentration risk with sales from single customer accounting for 55% of revenue to be major areas of concern.
[Earnings Review] Occidental Beat EPS Expectations on Strong Oil & Gas Performance
- Occidental’s Q1 2025 revenue rose by 13.9% YoY but missed estimates by 0.3%. Its net income rose by 6.7% YoY, and its EPS beat estimates by 12.1%.
- Occidental’s earnings beat was fueled by robust oil and gas segment growth, underpinned by stronger price realisations that offset volume softness and reinforced its upstream momentum.
- Occidental closed USD 1.3 billion in asset sales in Q1 and repaid USD 2.3 billion in debt YTD, underscoring its continued focus on debt reduction.
Japanese Big Cap Banks – Focusing on Strategic Equity Holdings as BoJ Likely to Defer Rate Hikes
- BoJ’s lower GDP growth forecasts add weight to the rate hike deferral; we focus on big-cap banks that have more in the tank than high gearing to rising benchmark rates
- An increasingly important factor, in our view, is the share of strategic equity holdings relative to market capitalization; Kyoto is top on this metric, followed by Shizuoka, Resona and Mizuho
- With the lack of the rate hike catalyst in the near term, we remove SMFG from the buy list and would look to lighten holdings selectively in other Japanese banks
CXW: 1Q25 Highlights
- Zacks Small-Cap Research Note for CoreCivic, Inc. (CXW)
Melco Holdings (6676 JP): Full-year FY03/25 flash update
- Revenue decreased by 1.8% YoY to JPY143.2bn, with IT business revenue up 13.6% and Food business down 43.9%.
- Operating profit increased by 242.7% YoY to JPY8.9bn, driven by IT segment’s OPM rise and cost ratio decline.
- Dividend per share for FY03/25 remained JPY120, with a total payout ratio of 117.7% including treasury stock repurchase.
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