In today’s briefing:
- Top 10 Korean Stock Picks and Key Catalysts Bi-Weekly (Starting 28 April 2025)
- Kyoto Financial Group (TSE:5844) – Positive Shift in C-Suite Outlook
- STMicroelectronics: Initiation of Coverage- An Insight Into Its Cost-Saving Initiatives & Financial Resilience!
- Synopsys: Harnessing Complexity
- Safran: Initiation of Coverage- Will the LEAP Engine Ramp-Up Reverse Its Stock Slide?
- Vinci: Initiation of Coverage- From Data Centers to Airports—Is This the Most Overlooked Infrastructure Powerhouse in Europe?
- Capgemini: Initiation of Coverage- Strategic Acquisitions & 4 Pivotal Growth Levers!
- Legrand S.A.: Initiation of Coverage- How Are They Executing Geographical Diversification To Seize Growth Opportunities!
- STMicro: Ugly but Mngt Says 1Q25 Is the Bottom. Restructuring Has to Start, Horrendous Inventories.
- Waaree Energies Pre IPO Lock-In Opens: What’s The Way Ahead
Top 10 Korean Stock Picks and Key Catalysts Bi-Weekly (Starting 28 April 2025)
- In this insight, we provide the top 10 stocks picks and key catalysts in the Korean stock market for the two weeks starting 28 April.
- Our top 10 picks in Korea were up on average 5.1% (from 11 to 25 April), outperforming KOSPI which is up 4.7% in the same period.
- Our top 10 picks in this bi-weekly include Hanwha Systems, Hyundai Elevator, HD Hyundai, Hyundai Rotem, SK Telecom, Samyang Foods, KT&G, Posco, SK Inc, and Korea Investment Holdings.
Kyoto Financial Group (TSE:5844) – Positive Shift in C-Suite Outlook
- Kyoto Financial’s president has hinted at increasing disposals in strategic equity holdings; the prior target was a JPY100bn reduction in holdings by March 2029, now there is talk of JPY200-300bn
- We estimate Kyoto Financial’s equity holdings relative to market cap at 140%+, well above its peer banks; yet, until very recently, the president had been against meaningfully reducing equity holdings
- The president’s change of view leads us to upgrade Kyoto Financial to a buy; the change in outlook means that there is real potential to extract value for shareholders
STMicroelectronics: Initiation of Coverage- An Insight Into Its Cost-Saving Initiatives & Financial Resilience!
- STMicroelectronics reported its financial results for the fourth quarter and the fiscal year 2024, showcasing notable operational challenges within a volatile market environment.
- The company experienced significant revenue declines amidst broader industry downturns particularly in its Industrial and Automotive segments.
- For the fourth quarter, STMicroelectronics saw a year-over-year decline in net revenues by 22.4%, landing at $3.32 billion, but managed a slight sequential increase of 2.2%.
Synopsys: Harnessing Complexity
- Chip design has long been a paradoxical craft.
- On one hand, engineers must trust sophisticated software to help them craft circuits of mind-boggling complexity; on the other, they maintain a healthy skepticism, knowing a single flaw can doom a chip.
- The old mantra “trust, but verify” could well have been coined for this process.
Safran: Initiation of Coverage- Will the LEAP Engine Ramp-Up Reverse Its Stock Slide?
- Safran’s financial results show a strong performance in 2024, with record highs in revenue, profit, and cash flows.
- Revenue increased by 18% to €27.3 billion, largely driven by a 25% growth in civil aftermarket activities.
- Operating margin improved by 150 basis points to 15.1%, supported by operational excellence and strong aftermarket demand.
Vinci: Initiation of Coverage- From Data Centers to Airports—Is This the Most Overlooked Infrastructure Powerhouse in Europe?
- Vinci, a global leader in concessions, construction, and energy, reported its financial performance for the fiscal year 2024, showcasing both achievements and challenges that frame its investment outlook.
- Positively, Vinci demonstrated robust revenue growth, achieving a 4% overall increase to reach record levels despite economic headwinds.
- This growth stemmed from significant contributions across its diverse business segments—Concessions, Energy, and Construction.
Capgemini: Initiation of Coverage- Strategic Acquisitions & 4 Pivotal Growth Levers!
- Capgemini’s full-year 2024 results reflect a mixed performance against a backdrop of continued market challenges.
- The company’s revenues saw a decline of 2% at constant currency to EUR 22,096 million, evidencing the broader economic pressures and restrained client spending, especially in sectors like Manufacturing and regions such as France.
- This drop was somewhat mitigated by resilience in segments such as Financial Services and Public Sector, and geographic improvement in North America, the U.K., Asia Pacific, and Latin America.
Legrand S.A.: Initiation of Coverage- How Are They Executing Geographical Diversification To Seize Growth Opportunities!
- Legrand, a French multinational company specializing in electrical and digital building infrastructure, concluded 2024 with noteworthy results, achieving its stated financial targets.
- The company reported a combined sales growth of 3.9%, driven by organic expansion and acquisitions, despite facing headwinds such as currency fluctuations and reduced contributions from Russia.
- Most prominently, Legrand’s data center segment and strategic M&A activities contributed significantly to its performance.
STMicro: Ugly but Mngt Says 1Q25 Is the Bottom. Restructuring Has to Start, Horrendous Inventories.
- Very poor 1Q25, operating profit close to zero. 2Q a bit better with lower revenue decline, but OP still close to zero.
- Management claims 1Q is the bottom for revenues, its possible, but 2 large risks: restructuring costs and very high inventories.
- Consensus expects a slow recovery into 2026, the stock looks cheap at 11x 2026 EPS. However, given the firm’s track record and the risks mentioned, lets wait 1 more quarter.
Waaree Energies Pre IPO Lock-In Opens: What’s The Way Ahead
- Waaree Energies posted exceptional Q4 and FY25 results, reporting a 72.6% YoY increase in EBITDA and a robust order book of INR 47,000 crores.
- The company continues to ramp up its manufacturing capacities, with a focus on solar cells, modules, and energy storage, positioning itself as a leader in India’s solar transition.
- Strong operational performance, strategic investments in green energy, and a solid order book enhance confidence in Waaree’s growth prospects for FY26 and beyond.
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