Daily BriefsTMT/Internet

Daily Brief TMT/Internet: LTIMindtree, NVIDIA Corp, FUJIFILM Holdings, Meituan, Xiaomi Corp, Kanzhun and more

In today’s briefing:

  • HDFC/​​​​​HDFC Bank Mega Merger Expected to Complete in a Few Weeks: Index Implications
  • Nvidia Results Blow-Out: Multi-Year Growth Ahead; Wiwynn in Taiwan, Plus a Smallcap Wildcard AI Play
  • FUJIFILM (4901.T) Loving The Setup Here
  • Meituan (3690 HK): 1Q23, Real Operating Profit Turned Positive After Nine Quarters
  • [Xiaomi (1810 HK, SELL, TP HK$8.2) Earnings Review]: Good Cost Control Could Be Transitory
  • [Kanzhun Ltd. (BZ US, SELL) Earnings Review]: Weak Labour Market Adds Uncertainty to Recovery

HDFC/​​​​​HDFC Bank Mega Merger Expected to Complete in a Few Weeks: Index Implications

By Brian Freitas


Nvidia Results Blow-Out: Multi-Year Growth Ahead; Wiwynn in Taiwan, Plus a Smallcap Wildcard AI Play

By Vincent Fernando, CFA

  • Nvidia’s results and guidance sparked a massive rally in the shares, marking one of the largest single-day increases in market cap in U.S. stock market history.
  • The company sees a multi-year growth cycle of data center upgrades ahead. Key supply chain partners TSMC and ASML are rising as well.
  • Wiwynn in Taiwan should be a key winner. We also highlight a potential wildcard smallcap AI play that we will investigate further.

FUJIFILM (4901.T) Loving The Setup Here

By William Keating

  • Q1’23 revenues of ¥764 billion, up 15% YoY and 2.6% QoQ
  • FY2022, revenues grew by 13.2% to ¥2,859 while net income grew by 3.9% to ¥219.4.
  • Electronic Materials set to grow from ¥180 billion in ’22 to ¥500 billion by ’30

Meituan (3690 HK): 1Q23, Real Operating Profit Turned Positive After Nine Quarters

By Ming Lu

  • In 1Q23, total revenues grew by 27% YoY with all business lines up by more than 10% YoY.
  • The real operating profits turned positive after nine quarters’ losses.
  • We believe the stock has an upside of 35% for yearend 2023. Buy.

[Xiaomi (1810 HK, SELL, TP HK$8.2) Earnings Review]: Good Cost Control Could Be Transitory

By Shawn Yang

  • Xiaomi reported C1Q23 top-line and non-IFRS net income (6.9%) and 20.7% vs. our est., and in-line and 39.9% vs. consensus; 
  • We suggest that higher margins are transitory, as (1) key IC component prices may have bottomed, (2) EV spend is likely to ramp up further. 
  • We maintain SELL and HK$ 8.2 TP, implying 26x FY23 PE.

[Kanzhun Ltd. (BZ US, SELL) Earnings Review]: Weak Labour Market Adds Uncertainty to Recovery

By Shawn Yang

  • BZ reported 1Q23 cash billing 2.9% higher than our est.; revenue in-line with our estimate and consensus;  and non-GAAP NI 36.3%/35.3% higher than our est. and cons.
  • As BZ approaching the proxy of China’s labour market, its primary hurdle is the slow recovery of labour demand and mismatch of supply and demand.
  • We maintain SELL rating and TP at US$13.5., as we are still waiting for signal for the overturn of job seeking market in China.

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