Daily Brief Industrials: CK Hutchison Holdings, Severfield PLC, Hitachi Energy India, Aditya Infotech Ltd, Flynas and more

• Inviting a PRC investor to join the bidding consortium as a significant member, as opposed to a majority player, appears the panacea to get this port deal over the line. 
• Although CK Hutchison Holdings (1 HK) stopped short of naming the investor, China’s state-owned shipping conglomerate Cosco is widely expected/rumoured to join BlackRock and Swiss-Italian shipping company MSC.
• Participation through effective intervention? Cosco’s involvement should all-but seal Chinese regulatory approvals. The green light from the US administration, the EU, and other jurisdictions, will pivot off how much involvement. 

Severfield has suffered greatly in the last 12 months, but the outlook appears to be improving as the order book is expanding and the low embedded margins within it wash out over the next 12 months or so. Furthermore, we anticipate the recruitment of a new chief executive ‘imminently’ and the company could return to paying dividends in the current year if the outlook and balance sheet improve sufficiently. Margin recovery could imply that risks are to the upside in FY27.

• A big rally in Hitachi Energy India (POWERIND IN) this year could lead to the stock being added to a global index in August.
• Hitachi Energy India (POWERIND IN) has outperformed its peers and now trades at significantly higher valuations compared to its peer group.
• There is positioning in the stock and early entrants could be looking to unwind some of their holdings over the next couple of weeks.

• Company operates home grown CCTV brand ‘CP PLUS’. Also the sole distributor for Zhejiang Dahua Technology A (002236 CH) in India. Dahua is also its primary components supplier.
• Expect 15-25% revenue growth vs 16% for industry with operating margins gradually improving to 10% translating to FY26E earnings range of 20-24.
• Company is raising 1,300cr (500cr fresh and 800cr OFS) at implied multiple of ~30x in line with valuation paid by Dixon Technologies India Ltd (DIXON IN) for its 6.5% stake.

• Flynas (4264 SR) listed on the Saudi Stock Exchange on 18 June at a valuation of $3.6bn, raising $1.1bn.
• The security is expected to be added to Global SmallCap at the November 2025 review.
• The security is expected to be added to Global All-World at the December 2025 review.