Daily Brief Financials: Japan Infrastructure Fund Investment Corporation, Sotherly Hotels , CAR Group , Karur Vysya Bank, China Vanke , Dream Incubator, NB Private Equity Partners and more

• Japan Infrastructure Fund Investment Corporation (9287 JP) has recommended a tender offer from Mizuho Leasing (8425 JP) at JPY65,000, a 21.5% premium to the last close price.
• The offer is light, as it is below book value (implying a P/NAV of 0.82x) and is below the midpoint of the IFA-adjusted book valuation range.
• However, a dispersed shareholder register with no substantial shareholders suggests that it is an uphill struggle for an activist to agitate for a bump. This is likely a done deal. 

• Sotherly Hotels is being acquired by Kemmons Wilson Hospitality Partners and Ascendant Capital Partners, with common shares priced at $2.25 each.
• Preferred shares SOHOB, SOHOO, and SOHON have a 12-14% spread to offer price, with conversion options post-merger.
• The merger isn’t subject to financing conditions, with funding commitments from Apollo and Ascendant-affiliated entities.

• Six Australian stock pairs have triggered new mean-reversion trade signals, with price ratios deviating more than two standard deviations from their one-year averages.
• Upcoming earnings announcements could add volatility and shape short-term trade outcomes.
• Essential for quantitative traders seeking mean-reversion opportunities, outlining opportunities and key risk considerations.

• Strong Financial Trajectory: The bank has demonstrated a robust growth trajectory, with significant year-over-year increases in revenue and net income, driven by healthy loan growth and improving net interest margins.
• Strategic Shift Towards Granular Assets: Management has successfully pivoted the loan book from corporate lending towards more granular and higher-yielding retail, MSME, and agricultural loans, which has improved asset quality and profitability.
• Favorable Valuation with a Positive Outlook: Despite its strong performance, the bank trades at a reasonable valuation compared to its peers. The outlook is positive, with management guiding for above-industry credit growth and stable margins, supported by digital initiatives and branch expansion.

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• In today’s Morning Views publication we comment on developments of the following high yield issuers: China Vanke
• UST yields rose 5-8 bps across the curve yesterday. This came as the market dialled back Fed rate-cut expectations following the release of strong ADP employment and ISM manufacturing data, as well as after the US Treasury Department said it may raise treasury issuances in future.
• The yield on the 2Y UST was up 5 bps at 3.63%, while the yield on the 10Y jumped 7 bps to 4.16%. Equities partially recovered from Tuesday’s slump, with the S&P 500 and Nasdaq increasing 0.4% and 0.6%, respectively.

• For 1H FY03/26, the company reported sales of JPY3.7bn (+30.2% YoY) and net income of JPY735mn.
• Business Production segment sales reached JPY2.9bn (+31.0% YoY), with operating profit of JPY310mn, showing smooth progress toward forecasts.
• Venture Capital segment sales were JPY795mn (+27.6% YoY), with operating profit of JPY459mn, including capital gains and valuation losses.

• In our view, NBPE’s 1H’25 results may be characterised as turning the corner.
• There has been a modest improvement in financial performance, the outlook for exits (with expected uplifts to carrying values) has improved, and the pipeline of new investments is strong.
• NBPE’s balance sheet has ample liquidity to take advantage of these opportunities, and its recent focus on mid-life deals means that value creation from these new investments has been rapid.