Daily Brief Financials: China Banking, Blackrock Inc, Nikkei 225, KE Holdings , S&P/ASX 200, Korea Stock Exchange KOSPI 200, LIC Housing Finance, The Western Investment Company, Molten Ventures , Cna Financial and more

• The review period for the February rebalance of the Philippines Stock Exchange PSEi Index (PCOMP INDEX) ends in two weeks.
• There could be two changes for the index with passive trackers needing to trade between 23-64x ADV in the stocks.
• The passive buying is a lot larger than the passive selling, there will be funding outflows for the other index constituents; some stocks will have over 1x ADV to trade.

• Infrastructure is crucial for the transition to a low carbon economy and the advancement of the economy, requiring urgent repairs to aging infrastructure such as roads, bridges, and airports.
• Private capital plays a key role in investing in infrastructure assets, with a focus on operational improvements and creating value for investors.
• The growing demand for investment in infrastructure, especially in the areas of AI and data centers, presents significant opportunities for private sector funding and operational enhancements.

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

• A bid for out-of-the-money puts combined with positive change in Put open interest and Put volume totals argues that Puts and being bought.
• 70% of NKY open interest is below 38,000 with only 20% of the open interest above 40,000.
• NKY nearing top of range while registering quiet historic volatility levels 4-5 points below implied vols. 

• The decline of new home sales was narrowed in the past ten months.
• New home, rental, and furnishing businesses grew strongly in 3Q24.
• We believe the operating margin will improve in 2025 and 2026.

• The S&P/ASX 200 INDEX it’s currently trending up quite well, since October 2023. The current rally picked up some steam from July 2024 and is quite steady. 
• The index started to pull back 2 weeks ago and has closed 2 consecutive weeks down and this week started with a Monday down Close.
• Our models show a clear opportunity to buy this dip and ride the index uptrend back to >3% profit target, roughly a 3-weeks movement according to our forecast.

• Risk reward for owning implied vol has shifted to the long side here given spot/vol dynamics and limited vol upside since market peaked 17% higher.
• Strong price action after a soggy start to the week sees a significant portion of open interest cleared out.
• Largest open interest is at the 300 strike with ~ 42k Put contracts outstanding.

• Optically speaking LICHF’s Q2FY25 results may not look as strong given modest PAT growth of 12% YoY, however, there was substantial improvement in asset quality and credit cost.
• Annualized credit cost has stabilized to below 0.2% of AUM for the past couple of quarters, in line with the historical averages.
• Last few quarters saw significant variation in earnings due to NIM variation, however, it has now stabilized at around 2.7% vs 3%+ earlier, making the earnings more predictable going forward.

• Ian Cassel, a renowned investor in the microcap space, consistently emphasizes the importance of seeking “overqualified management teams” in microcap companies with proven track records. 
• The company I present today, Western Investment Company of Canada, exemplifies this approach.
• Western Investment Company of Canada (WI) is an investment holding company currently undergoing a transformation to become an insurance holding company. Its goal is to serve as a platform for small niche insurers in Western Canada.

Molten’s portfolio valuations remain stable in H125, illustrated by the limited fair value movements of its core holdings that recently completed new funding rounds, as well as Molten’s recent exits (representing aggregate proceeds of c £124m), all of which were completed at or slightly above previous carrying values. While the valuations of listed cloud businesses compressed somewhat between end-March 2024 and end-September 2024, they rebounded visibly after the US election. Moreover, Molten expects its core holdings to deliver weighted average revenue growth of 71% in 2024 and 48% in 2025. Its H125 NAV TR decline of 2.4% came largely from FX headwinds, while the 1.4% constant currency increase in gross portfolio value was driven by the revaluation of Revolut, partly offset by a markdown of Thought Machine.

• Tisch family provides long-term focus on shareholder value
• Solid dividend policy in place for income generation
• Favorable valuation makes CNA Financial an attractive investment opportunity

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.