Equity Research Analyst - Long-Short

Raj S, CA, CFA

Equity Bottom-Up

Vertiv Holdings Co operates as a holding company. The Company, through its subsidiaries, provides electrical power equipment, thermal management, racks and enclosures, monitoring and management, tools, and other services. Vertiv Holdings serves data centers, communication networks, commercial, and industrial environments worldwide.

<ul>
<li>
Medium term: Vertiv's Gray-space leadership is extending into white space through liquid cooling, integrated infrastructure and 800VDC; management targets 20-22% organic revenue CAGR through 2030, with further content/share upside.</li>
<li>
Short term: 2Q26 weakness was driven by supply-chain constraints and execution on larger integrated projects. FY26 guidance 40%+ 2H26 organic growth, making 2H26 backlog conversion the key debate near-term.</li>
<li>
Valuation: Recent consensus earnings have upgraded, accompanied by P/E de-rating to bottom-of-range. Our base case implies roughly 80% upside and bull case 100%+, driven mainly by earnings growth.</li>
</ul>



Medium term: Vertiv's Gray-space leadership is extending into white space through liquid cooling, integrated infrastructure and 800VDC; management targets 20-22% organic revenue CAGR through 2030, with further content/share upside.

Short term: 2Q26 weakness was driven by supply-chain constraints and execution on larger integrated projects. FY26 guidance 40%+ 2H26 organic growth, making 2H26 backlog conversion the key debate near-term.

Valuation: Recent consensus earnings have upgraded, accompanied by P/E de-rating to bottom-of-range. Our base case implies roughly 80% upside and bull case 100%+, driven mainly by earnings growth.


Vertiv Holdings Co (VRT US): Buy Into Near-Term Weakness - Gray-Space Leadership, White-Space Upside

Futu Holdings Limited operates as a holding company. The Company, through its subsidiaries, offers an online brokerage platform that enables individual investors to trade in listed stocks. Futu Holdings serves customers in the United States, China, and Hong Kong.

<ul>
<li>Mainland exposure was always the "red flag" for Futu and that's now removed; the current valuations and downgrades price in the worst case scenario, providing a clear asymmetric upside opportunity.</li>
<li>2Q is evidence that the underlying business remains strong: revenue increased 36% y/y, profits +40% y/y, strong client adds ex-mainland, and trading volume reached new records</li>
<li>Futu trades at 9.9x FY2 P/E, around the bottom of its three-year range; a return to 16x FY2 P/E implies approximately 60% upside, not to mention the long-term compounding business.</li>
</ul>


Mainland exposure was always the "red flag" for Futu and that's now removed; the current valuations and downgrades price in the worst case scenario, providing a clear asymmetric upside opportunity.
2Q is evidence that the underlying business remains strong: revenue increased 36% y/y, profits +40% y/y, strong client adds ex-mainland, and trading volume reached new records
Futu trades at 9.9x FY2 P/E, around the bottom of its three-year range; a return to 16x FY2 P/E implies approximately 60% upside, not to mention the long-term compounding business.


Futu Holdings (FUTU US) : Regulatory Risk Reset, Asymmetric Upside

Delta Electronics Inc. manufactures power supplies and video display products. The Company's products include switching power supplies, telecom power systems, uninterrupted power supply (UPS), variable speed alternating current (AC) monitor drives, high resolution color monitors, and projectors.  Delta also manufactures magnetic and networking components.

<ul>
<li>
 Medium term: Delta remains well placed to capture the AI power upgrade cycle, with PSU leadership extending into DC/DC, BBU and HVDC power racks as 800VDC adoption scales through 2027-28e.</li>
<li>
 Short term: 2Q26 margin pressure was driven by supply constraints and input-cost inflation; 3Q/4Q should show price pass-through. Even if normalization slips into 1Q27, this is not a thesis breaker.</li>
<li>
 Valuation: Rolling FY2 P/E has corrected to ~28x from ~35-39x at the recent peak, while earnings remain strong. That creates a better entry point with original upside thesis intact.</li>
</ul>



 Medium term: Delta remains well placed to capture the AI power upgrade cycle, with PSU leadership extending into DC/DC, BBU and HVDC power racks as 800VDC adoption scales through 2027-28e.

 Short term: 2Q26 margin pressure was driven by supply constraints and input-cost inflation; 3Q/4Q should show price pass-through. Even if normalization slips into 1Q27, this is not a thesis breaker.

 Valuation: Rolling FY2 P/E has corrected to ~28x from ~35-39x at the recent peak, while earnings remain strong. That creates a better entry point with original upside thesis intact.


Delta Electronics (2308 TT) - Buy Into Short-Term Weakness - Architecture Confidence Increasing.

Power Grid Corporation of India / Equity Bottom-Up

Power Grid Corporation of India Limited is a central public sector undertaking primarily engaged in the transmission of bulk electric power across different states of India through its extensive network of transmission lines and substations. It also offers consultancy services and operates in the telecom sector through its brand POWERTEL. The company is headquartered in Gurugram, Haryana, India, and was founded on October 23, 1989.

Power Grid Corporation of India (PWGR IN)

<ul>
<li>Power Grid has work-in-hand of ~5x FY27 capex guidance, while 1QFY27 showed a clear improvement in execution through stronger capitalisation and continued TBCB wins.</li>
<li>India’s transmission opportunity remains structurally strong, and we believe Power Grid is entering an operational recovery phase. The key catalyst is sustained project execution and monetisation through 2027e.</li>
<li>We value Power Grid at 3.5x FY28E P/B, implying 60%+ upside over a medium-term horizon, largely driven by re-rating as execution and tariff conversion become more visible.</li>
</ul>


Power Grid has work-in-hand of ~5x FY27 capex guidance, while 1QFY27 showed a clear improvement in execution through stronger capitalisation and continued TBCB wins.
India’s transmission opportunity remains structurally strong, and we believe Power Grid is entering an operational recovery phase. The key catalyst is sustained project execution and monetisation through 2027e.
We value Power Grid at 3.5x FY28E P/B, implying 60%+ upside over a medium-term horizon, largely driven by re-rating as execution and tariff conversion become more visible.


Contemporary Amperex Technology / Equity Bottom-Up

Contemporary Amperex Technology Co., Limited (CATL) is a Chinese battery manufacturer and technology company specializing in lithium-ion batteries for electric vehicles and energy storage systems. It is the world's largest producer of EV and energy storage batteries, also offering battery materials and recycling services. The company was founded in 2011 and is headquartered in Ningde, Fujian province, China.

Contemporary Amperex Technology (3750 HK)

<ul>
<li>CATL-H has corrected ~20% from the June peak, driven largely by market beta across global energy and AIDC-adjacent sectors.</li>
<li>Demand still looks strong, with 1H26 volume up nearly 60% y/y, ESS ~25% of shipments, high utilisation, and management guiding 20-30% EV+ESS shipment CAGR.</li>
<li>CATL-A now trades at ~16x FY2 P/E versus a 19.9x peak in May-26 while the FY2 EPS has been upgraded through the period - the correction is mainly market beta.</li>
</ul>


CATL-H has corrected ~20% from the June peak, driven largely by market beta across global energy and AIDC-adjacent sectors.
Demand still looks strong, with 1H26 volume up nearly 60% y/y, ESS ~25% of shipments, high utilisation, and management guiding 20-30% EV+ESS shipment CAGR.
CATL-A now trades at ~16x FY2 P/E versus a 19.9x peak in May-26 while the FY2 EPS has been upgraded through the period - the correction is mainly market beta.


CATL (3750HK / 3000750 CH): Market Leader at a Discount - 2Q26 Review

I am Raj - CA and CFA. A Buy-side analyst.

I cover BFSI, Autos, Tech, AI and several other sectors across geographies.
   
I am a CA and CFA, with 10+ years experience in fundamental equity research across buy-side and sell-side and across geographies.

My research process is fundamental driven, focused on the catalysts which would have a direct impact on a stocks performance and market valuation. These days, I look for names which have a clear mis-pricing evident in its valuation vs. fundamental business moats/ growth/ NAV. Fortunately, there are always such stories around. More importantly, the timeline of when the mis-pricing is resolved and what triggers this resolution is what interests me.