In today’s briefing:
- ZEEKR (ZK US) IPO: Valuation Insights
- Hollysys (HOLI US): Further Thoughts on the Widening Spread
- LRCX. Mounting Tailwinds Bode Well For 2025 & Beyond
ZEEKR (ZK US) IPO: Valuation Insights
- ZEEKR (ZK US), a premium Chinese BEV manufacturer and a subsidiary of Geely Auto (175 HK), has launched an IPO to raise up to US$368 million.
- We previously discussed the IPO in ZEEKR IPO: The Bull Case, ZEEKR IPO: The Bear Case and ZEEKR IPO: Latest Updates as the IPO Process Restarts.
- The IPO price range values ZEEKR at a material discount to peers’ multiples. We would be inclined to participate in the IPO.
Hollysys (HOLI US): Further Thoughts on the Widening Spread
- I have received several questions from readers on Ascendent’s binding proposal for Hollysys Automation Technologies (HOLI US) in the context of the current gross spread of 12.1%.
- The questions primarily concerned the Capital Forum article, NSR approvals, timelines, auditor resignation and deal break risks.
- Most of the questions concerned regulatory approval risk. The delay in closing is mainly procedural (government red tape) rather than an indication that regulators will block the deal.
LRCX. Mounting Tailwinds Bode Well For 2025 & Beyond
- Q124 revenues of $3.79 billion, pretty much flat sequentially both QoQ and YoY, and also marginally better than guidance.
- Looking ahead, the company forecasted Q224 revenues $3.8 billion, i.e. flat QoQ. Still no full year 2024 outlook
- Technology transitions such as GAA, Backside Power, molybdenum replacing tungsten & the rise of generative AI will all be growth drivers in 2025 & beyond
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