In today’s briefing:
- Tencent (700 HK) Vs. Hang Seng (HSI INDEX): Price-Ratio Hits Trigger Zone
- Relative Value Opportunities in Asia-Pac, Pair Trade Roundup (25 Aug)
- Taiwan Dual-Listings Monitor: TSMC Premium Spike Opportunity; ASE Hard Bounce to Prem from Discount
- Intel (INTC.US): Intel–U.S. Government Equity Deal: Implications and Industry Perspective
- Meta Is Ripping Apart Its AI Division—& Betting Big To Catch OpenAI
- Zhou Liu Fu (6168 HK): 1H25 Is Fine, but Still……
- Boeing’s $65 Billion China Lifeline: A Rare Win Amid Mounting Headwinds!
- Amdocs: Surging Ahead By Transforming Cloud, Data, & Network Monetization!
- Bayan Resources (BYAN IJ): Ultra-Low-Cost Coal Champion Trading at a Steep Premium
- MinebeaMitsumi Inc. (TSE:6479) – Precision Leader in Transition with Growth Catalysts Ahead
Tencent (700 HK) Vs. Hang Seng (HSI INDEX): Price-Ratio Hits Trigger Zone
- Context: The Tencent (700 HK) vs. Hang Seng Index (HSI INDEX) price-ratio has deviated more than two standard deviations from its one-year average, presenting a potential relative value opportunity.
- Highlights: After Tencent’s recent outperformance, going long the HSI and short Tencent targets an 8% 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.
Relative Value Opportunities in Asia-Pac, Pair Trade Roundup (25 Aug)
- 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.
- Highlight: Currently eight pair trade opportunities across three markets and four sectors persist.
- 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.
Taiwan Dual-Listings Monitor: TSMC Premium Spike Opportunity; ASE Hard Bounce to Prem from Discount
- TSMC: +25.6% Premium: Latest Spike is Opportunity to Short the ADR Spread
- UMC: +2.0% Premium; Near Level to Go Short the ADR Spread
- ASE: +5.1% Premium; Good Level to Take Profits on Previous Long Since Parity
Intel (INTC.US): Intel–U.S. Government Equity Deal: Implications and Industry Perspective
- Intel has reached an agreement with the U.S. government, under which Washington will invest $8.9bn for a 9.9% equity stake in the company.
- Intel benefits from the optics of government backing, which could help sentiment and prevent downside pressure on the stock in the short term, i.e. near-term optics positive, fundamentals unchanged.
- TSMC’s Japan and Germany fabs were structured through co-investments and partnerships, with equity involvement only when tied to technology access (e.g., Sony CMOS JV).
Meta Is Ripping Apart Its AI Division—& Betting Big To Catch OpenAI
- In a high-stakes move to stay competitive in the rapidly evolving AI landscape, Meta Platforms is radically restructuring its artificial intelligence organization.
- The company is dismantling its existing Meta Superintelligence Labs (MSL) and splitting it into four specialized groups—focused on research, product, infrastructure, and superintelligence.
- This development follows months of internal tension and strategic uncertainty, culminating in a significant leadership pivot with the appointment of Scale AI’s founder Alexandr Wang as Meta’s new Chief AI Officer.
Zhou Liu Fu (6168 HK): 1H25 Is Fine, but Still……
- Zhou Liu Fu Jewellery (6168 HK)‘s 1H25 results are healthy, but there are challenges, including weak revenue growth and higher R&D costs.
- Growth is almost entirely driven by online sales, but its plan to expand offline stores rapidly may erode net profit in the near term.
- The stock has become the most expensive one in the sector, based on its PERs of 22.4x CY25F and 21.4x CY26F. Its 3-year EPS CAGR of 6.8% is uninspiring.
Boeing’s $65 Billion China Lifeline: A Rare Win Amid Mounting Headwinds!
- After years of turbulence, Boeing is closing in on a potential mega-deal to sell up to 500 aircraft to China.
- This development comes at a time when the U.S. aerospace giant continues to wrestle with production inefficiencies, regulatory scrutiny, safety lapses, and supply chain instability.
- The proposed transaction—still contingent on easing trade tensions between the U.S. and China—would mark the largest commercial order since President Trump’s 2017 visit and may serve as the centerpiece of a broader trade agreement between the two economic superpowers.
Amdocs: Surging Ahead By Transforming Cloud, Data, & Network Monetization!
- Amdocs recently announced its financial performance for the third quarter of fiscal year 2025, which showcased mixed results and highlighted the company’s strategic focus areas and operational achievements.
- The company recorded a revenue of $1.14 billion, marking a 3.5% increase in pro forma constant currency compared to the previous year.
- This was aided by significant contributions from various regions, most notably a record quarter in Europe.
Bayan Resources (BYAN IJ): Ultra-Low-Cost Coal Champion Trading at a Steep Premium
- Bayan Resources delivered solid H1 2025 results with strong volumes and margins but faces an ambitious ramp-up challenge in H2 to meet full-year targets.
- The company’s 2025 guidance calls for 70–72 million tonnes sales, revenue of US$4.1–4.4 billion, and EBITDA of US$1.4–1.6 billion, supported by Tabang expansion and stable costs.
- Despite solid fundamentals, Bayan trades at a steep premium with P/E of ~39x and EV/EBITDA of ~27x, far above Indonesian coal peers.
MinebeaMitsumi Inc. (TSE:6479) – Precision Leader in Transition with Growth Catalysts Ahead
- MinebeaMitsumi is focused on expanding semiconductor backend capacity with the Cebu Mitsumi facility, ramping aerospace machining in India, and scaling AI/data center cooling bearings through FY27–28.
- In Q1 FY26, MinebeaMitsumi posted record revenues of ¥366.9bn (+3.2% YoY), though operating income declined 7.8% YoY to ¥17.4bn due to yen appreciation and rare-earth supply disruptions.
- Trading at a reasonable 8.1× EV/EBITDA and 20.9× P/E (TTM), the stock offers a mid-range multiple relative to peers like Nidec and NSK, reflecting a stable but cyclical industrial franchise.
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