In today’s briefing:
- Sony To Sell Down SRE Holdings (2980 JP) Block – AI-Related Growth Stock Should See Support
- Soundwill Holdings (878 HK): Privatisation Expected From The Controlling Family
- Soundwill Holdings (878 HK): Privatisation from the Controlling Shareholder?
- EQD | ANZ Group Holdings (ANZ AU): Anticipated Price Swings on Q1 Announcement on 20 Feb 2025
- EQD | National Australia Bank (NAB AU): Anticipated Price Swings on Q1 Trading Update on 19 Feb 2025
- Bank Rakyat Indonesia (BBRI IJ) – Visibility and Quality Improving
- KKR/Assura: Possible Sweetened Offer
- Unibail-Rodamco-Westfield: Strong FY Results, De-Leveraging on Track, Back to Growth Trajectory
- Asia Real Estate Tracker (17-Feb-2025): Alyssa Partners teams with LGB to buy $65M Tokyo building.
- Kospi Index Options Weekly (February 10 – 14): Call Volumes Rebound
Sony To Sell Down SRE Holdings (2980 JP) Block – AI-Related Growth Stock Should See Support
- SRE Holdings Corp (2980 JP) does a business in AI Cloud&Consulting for the real estate, finance, and Life & Healthcare business. Sony Corp (6758 JP) is selling a stake.
- The offering is for about US$50mm assuming a 10% discount today’s close. It is not clear how much this was expected but there is a decent-sized short position.
- The stock has its ups and downs, and recently decided it liked Q3 earnings and guidance. That bodes well for the offering.
Soundwill Holdings (878 HK): Privatisation Expected From The Controlling Family
- Small-Cap property developer Soundwill Holdings (878 HK) is currently suspended pursuant to the Takeovers Code
- Soundwill is controlled as to 74.97% by Grace Foo (ED), and her descendants, Wai Ling Chan (deputy chairman), and Hing Tat Chan (chairman).
- Soundwill is trading at a staggering 0.08x P/B, with the majority of its book value tied up in investment properties.
Soundwill Holdings (878 HK): Privatisation from the Controlling Shareholder?
- Soundwill Holdings (878 HK) has entered a trading halt “pending the release of an announcement relating to inside information and pursuant to the Codes on Takeovers and Mergers.”
- It is likely that the controlling shareholder (Foo Family Trust), representing 74.94% of outstanding shares, is seeking to launch a privatisation through a Bermuda scheme.
- While no disinterested shareholder holds a blocking stake, the headcount test necessitates an attractive offer. We estimate a potential offer price range of HK$7.53-19.44.
EQD | ANZ Group Holdings (ANZ AU): Anticipated Price Swings on Q1 Announcement on 20 Feb 2025
- ANZ Group Holdings (ANZ AU) is set to announce its First Quarter APS 330 Release on Thursday 20 February 2025.
- Traders can trade the event through 20 February 2025 listed options (monthly expiration). Strategies discussed reflect different expectations of market reactions, with risk implications.
- Historically, ANZ has experienced an average price move of 1.9% following profit announcements. Option markets anticipate a similar move this time.
EQD | National Australia Bank (NAB AU): Anticipated Price Swings on Q1 Trading Update on 19 Feb 2025
- National Australia Bank (NAB AU) is set to announce its First Quarter Trading Update on Wednesday 19 February 2025.
- Traders can trade the event through 20 February 2025 listed options (monthly expiration). Strategies discussed reflect different expectations of market reactions, with risk implications.
- Historically, NAB has experienced an average price move of 2.2% following profit announcements. Option markets anticipate a slightly larger move.
Bank Rakyat Indonesia (BBRI IJ) – Visibility and Quality Improving
- Bank Rakyat Indonesia management painted a relatively positive picture of improvements across its microloan portfolio in 2H2024, with strong growth in recoveries during the year.
- Loan growth was driven by corporate and consumer loans, as the bank slowed micro and small-sized loan growth with ongoing restructuring, which will continue in 2025 and front-loaded in 1Q2025.
- Bank Rakyat Indonesia remains unique in its exposure to micro and ultra-micro lending in Indonesia, where growth should resume in 2025. Foreign ownership and valuations stand at 15-year lows.
KKR/Assura: Possible Sweetened Offer
- Takeover Interest: KKR proposed a 48.0p per share bid for Assura, a 28.2% premium to its last closing price but a 2.8% discount to its 49.4p NAV.
- Financial Position: Assura reported £157.8M in revenue (+4.92% YoY) and reduced net losses from £119.2M to £28.6M, showing improved operational performance, which could support a sweetened offer.
- With Assura trading at 42.6p against KKR’s 48.0p bid, the gross spread is 12.7%, implying a 74.3% market-implied probability of deal success using a 37.44p break price.
Unibail-Rodamco-Westfield: Strong FY Results, De-Leveraging on Track, Back to Growth Trajectory
- Unibail announced its FY results, which we view as strong across the board. Rent is growing and vacancy is coming down
- Unibail has made progress on deleveraging. The company has ample cash, low cost of borrow and a strong balance sheet
- With de-leveraging on track, investors should focus on growth. Valuation is attractive
Asia Real Estate Tracker (17-Feb-2025): Alyssa Partners teams with LGB to buy $65M Tokyo building.
- Alyssa Partners and LGB team up to purchase Tokyo apartment building for $65 million, expanding their real estate portfolio.
- Gaw Capital faces challenges as it defaults on a $100 million loan for a California hotel, highlighting financial struggles in the industry.
- Emperor Group secures a Sai Ying Pun site at a discounted rate of 12%, signaling a strategic investment opportunity in the Hong Kong market. Digital Core REIT strengthens leadership with the appointment of Serene Nah as chairperson, bringing valuable experience from Digital Realty APAC.
Kospi Index Options Weekly (February 10 – 14): Call Volumes Rebound
- Very low volatility rally with Kospi up 2.63% but still 7% below the 52-week high.
- Implied vols moving in opposition to the rally, dropping 1 point on the week.
- Call volumes rebounded significantly with the most active Call strike trading more than twice as much as the most active Put strike.
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