Global Materials | Industrials | Commodities

Rahul Jain

Equity Bottom-Up

JFE Holdings, Inc. is a holding company which was established through the merger of NKK Corp and Kawasaki Steel Corp.  The Company manages and conducts its subsidiaries' business, which is steel production and integrated engineering services.

<ul>
<li>BPSL JV gives JFE a scalable India platform, shifting long-term growth away from a stagnant Japan market.</li>
<li>Balance-Sheet impact is manageable, with optional liquidity from the ¥500 bn JSW stake.</li>
<li>Valuation deeply discounted at 0.5× P/B and US$525/t despite rising mix, India optionality, and multi-year earnings normalization.</li>
</ul>


BPSL JV gives JFE a scalable India platform, shifting long-term growth away from a stagnant Japan market.
Balance-Sheet impact is manageable, with optional liquidity from the ¥500 bn JSW stake.
Valuation deeply discounted at 0.5× P/B and US$525/t despite rising mix, India optionality, and multi-year earnings normalization.


JFE Holdings: India JV Resets Long-Term Growth Path; Deep Value with Structural Upside

Aequs Limited is a precision-engineering and manufacturing company that produces complex, high-tolerance components for global OEMs across the aerospace and consumer sectors. 

The company operates three integrated manufacturing ecosystems in India (the Belagavi, Hubballi, and Koppal clusters) each designed to deliver end-to-end production capabilities from design to assembly.

<ul>
<li>Aequs has a strong integrated aerospace ecosystem and deep OEM ties, but consolidated margins remain weak due to low overseas utilisation and losses in the consumer vertical.</li>
<li>A robust ₹4,200–4,500 Cr aerospace backlog and India cluster scale provide visibility, but working-capital stretch and customer concentration elevate execution risk.</li>
<li>View: Operating-Leverage story; valuation upside (₹180–200) requires utilisation lift and margin recovery. OFS-heavy structure and promoter dilution temper near-term sentiment.</li>
</ul>


Aequs has a strong integrated aerospace ecosystem and deep OEM ties, but consolidated margins remain weak due to low overseas utilisation and losses in the consumer vertical.
A robust ₹4,200–4,500 Cr aerospace backlog and India cluster scale provide visibility, but working-capital stretch and customer concentration elevate execution risk.
View: Operating-Leverage story; valuation upside (₹180–200) requires utilisation lift and margin recovery. OFS-heavy structure and promoter dilution temper near-term sentiment.


Aequs IPO: Strong Backlog, Weak Margins — An Operating-Leverage Re-Rating Story

Thematic (Sector/Industry)

<ul>
<li>Precious and energy-transition metals lead as structural scarcity, central-bank demand, and electrification support gold, silver, copper, aluminium, zinc, and rare earths into 2026.</li>
<li>Bulks and hydrocarbons lag with weak China demand, oversupply, and compressed margins across iron ore, nickel, steel, coal, and crude, keeping the segment firmly underweight.</li>
<li>Top Asia exposures include Zijin, Korea Zinc, Hindustan Zinc, Vedanta, CMOC, JXAM, SMM, Mitsui, Jiangxi Copper, NALCO, Hongqiao, Hindalco, Shenghe, and CNRE.</li>
</ul>


Precious and energy-transition metals lead as structural scarcity, central-bank demand, and electrification support gold, silver, copper, aluminium, zinc, and rare earths into 2026.
Bulks and hydrocarbons lag with weak China demand, oversupply, and compressed margins across iron ore, nickel, steel, coal, and crude, keeping the segment firmly underweight.
Top Asia exposures include Zijin, Korea Zinc, Hindustan Zinc, Vedanta, CMOC, JXAM, SMM, Mitsui, Jiangxi Copper, NALCO, Hongqiao, Hindalco, Shenghe, and CNRE.


Asia Metals Outlook 2026: Scarcity Favours Gold, Copper, Aluminium

Resonac Holdings Corporation manufactures and distributes chemical products. The Company produces synthetic resins, petrochemical products, inorganics, and other related products. Resonac Holdings also produces ceramics, metals, carbon, electronic materials, and other products.

<ul>
<li>Semiconductor segment drives structural margin expansion, now contributing over 100% of core profit with record Q3 performance.</li>
<li>Legacy Chemicals and Graphite remain weak, but consolidated EBITDA outlook for FY2026–27 strengthens on improving mix.</li>
<li>Forward valuation supports ¥8,000 target; Resonac trades at a discount to global semiconductor-materials peers despite rising semis exposure.</li>
</ul>


Semiconductor segment drives structural margin expansion, now contributing over 100% of core profit with record Q3 performance.
Legacy Chemicals and Graphite remain weak, but consolidated EBITDA outlook for FY2026–27 strengthens on improving mix.
Forward valuation supports ¥8,000 target; Resonac trades at a discount to global semiconductor-materials peers despite rising semis exposure.


Resonac Holdings – Improving Mix, Expanding Margins, and a Clear Case for Re-Rating

<ul>
<li>CNRE delivered strong H1 results and downstream momentum, but its valuation remains elevated even after the pullback.</li>
<li>Shenghe offers superior risk-adjusted value with cleaner pricing leverage and materially lower multiples.</li>
<li>Lynas still trades on geopolitical scarcity, not earnings strength, making it suitable only as strategic optionality.</li>
</ul>


CNRE delivered strong H1 results and downstream momentum, but its valuation remains elevated even after the pullback.
Shenghe offers superior risk-adjusted value with cleaner pricing leverage and materially lower multiples.
Lynas still trades on geopolitical scarcity, not earnings strength, making it suitable only as strategic optionality.


Rare Earths 2025: Improving Fundamentals, Limited Valuation Headroom

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.