Global Materials | Industrials | Commodities

Rahul Jain

Equity Bottom-Up

TAIHEIYO CEMENT CORPORATION manufactures cement and industrial materials such as limestone.  The Company also operates real estate, waste management (zero emission promotion), and transportation businesses. Taiheiyo Cement operates in Japan, China, and the United States.

<ul>
<li>Taiheiyo Cement’s California platform is vertically integrated and permit-constrained, yet valued at a Japanese consolidated multiple.</li>
<li>Activist engagement targets U.S. asset re-rating, capital allocation discipline, and potential monetisation.</li>
<li>Base case values shares at ¥4,800; activist outcome implies ¥7,200 driven by U.S. multiple normalisation.</li>
</ul>


Taiheiyo Cement’s California platform is vertically integrated and permit-constrained, yet valued at a Japanese consolidated multiple.
Activist engagement targets U.S. asset re-rating, capital allocation discipline, and potential monetisation.
Base case values shares at ¥4,800; activist outcome implies ¥7,200 driven by U.S. multiple normalisation.


Taiheiyo Cement (5233 JP): U.S. Scarcity Assets Drive Activist Re-Rating Potential

DOWA HOLDINGS, CO., LTD. mines, refines, smelts, and produces various metalrelated products.  The Company's main products include minerals, precious metals, battery materials, semiconductor and superconductivity materials, magnetic materials, and optical devices.

<ul>
<li>DOWA has re-rated from ¥4,500 to ~¥7,000 on risk compression and commodity optionality, not improved structural returns.</li>
<li>FY25 earnings were revised upward, but ROIC remains mid-single digit, with Electronic Materials a persistent structural drag.</li>
<li>Even at elevated silver prices, valuation appears largely priced in, supporting a Neutral stance.</li>
</ul>


DOWA has re-rated from ¥4,500 to ~¥7,000 on risk compression and commodity optionality, not improved structural returns.
FY25 earnings were revised upward, but ROIC remains mid-single digit, with Electronic Materials a persistent structural drag.
Even at elevated silver prices, valuation appears largely priced in, supporting a Neutral stance.


DOWA Holdings (5714 JP): Risk Reset Completed; Optionality Priced In

Vedanta Limited mines, produces, and exports base metals. The Company mines and distributes metals such as zinc, iron ore, copper, silver, and aluminium, as well as operates power plants. Vedanta markets its products worldwide.

<ul>
<li>NCLT approval removes the key overhang, enabling Vedanta’s break-up and forcing valuation discovery across aluminium, zinc/silver, power and O&amp;G.</li>
<li>Aluminium becomes the anchor, with falling costs and ~50% EBITDA share; zinc and silver provide resilient cash flows and downside protection.</li>
<li>Intrinsic SOTP ₹1,020–1,050/share implies ~78–83% upside from CMP ₹572; execution-weighted 12-month TP ₹770 offers ~35% upside with downside protected even under stressed aluminium prices.</li>
</ul>


NCLT approval removes the key overhang, enabling Vedanta’s break-up and forcing valuation discovery across aluminium, zinc/silver, power and O&amp;G.
Aluminium becomes the anchor, with falling costs and ~50% EBITDA share; zinc and silver provide resilient cash flows and downside protection.
Intrinsic SOTP ₹1,020–1,050/share implies ~78–83% upside from CMP ₹572; execution-weighted 12-month TP ₹770 offers ~35% upside with downside protected even under stressed aluminium prices.


Vedanta: NCLT Approval Unlocks Aluminium-Led Break-Up Value

CMOC Group Limited operates as a mineral mining and exploration company. The Company focuses on non-ferrous metal mining. CMOC Group specializes in mining and trading of base and rare metals.

<ul>
<li>Brazil gold acquisition improves diversification and earnings stability; deal appears cash-funded and value-accretive at current gold prices.</li>
<li>Asset quality improves on a risk-adjusted basis, though Brazilian gold mines are higher-cost and shorter-life than tier-1 peers.</li>
<li>Valuation already reflects elevated copper and gold prices; upside now depends on commodity price persistence, not rerating.</li>
</ul>


Brazil gold acquisition improves diversification and earnings stability; deal appears cash-funded and value-accretive at current gold prices.
Asset quality improves on a risk-adjusted basis, though Brazilian gold mines are higher-cost and shorter-life than tier-1 peers.
Valuation already reflects elevated copper and gold prices; upside now depends on commodity price persistence, not rerating.


CMOC Group (603993 CH): Brazil Gold Deal Lifts Diversification; Valuation Tied to Metals Regime

Korea Zinc Co., Ltd. specializes in non-ferrous metal smelting industry.  The Company manufactures zinc ingots, electrolytic gold, silver, lead, sulfuric acid, and copper.  Korea Zinc provides its products to domestic and overseas markets.

<ul>
<li>US-Backed US$7.4bn smelter embeds Korea Zinc in US critical-minerals supply chains, lifting long-term strategic relevance and valuation floor.</li>
<li>Shares eased after an initial spike as dilution, low JV ownership, governance litigation risk, and long-dated cash flows weighed on near-term sentiment.</li>
<li>We retain a ₩2.1m TP (~30% upside), supported by TC recovery, rare-metals margins, buybacks, and partial governance-discount compression.</li>
</ul>


US-Backed US$7.4bn smelter embeds Korea Zinc in US critical-minerals supply chains, lifting long-term strategic relevance and valuation floor.
Shares eased after an initial spike as dilution, low JV ownership, governance litigation risk, and long-dated cash flows weighed on near-term sentiment.
We retain a ₩2.1m TP (~30% upside), supported by TC recovery, rare-metals margins, buybacks, and partial governance-discount compression.


Korea Zinc: US-Backed Smelter Lifts Strategic Floor; Dilution & Control Risks Weighed

Over 20 years of sell-side research experience across Global Metals & Mining, Cement, Industrials, and Commodities. Extensive first-hand mine and plant visits spanning India, Australia, China, the US, and the UK.
Hundreds of buy-side engagements across major global financial hubs in Asia, North America, and Europe. Also led a comprehensive client tour of China to deepen industry understanding.

Focused on fundamentals-driven analysis including earnings modeling, cost structures, and valuations using DCF and relative multiples. Global commodity cycles, supply-demand trends, and macro factors are integrated into sector calls. Research prioritizes inflection points from price, cost, and policy shifts, using a disciplined bottom-up approach supported by top-down macro screening.