Equity, Bottom-up Analyst, Investics Research

Sameer Taneja

Equity, Bottom-up Analyst

Investics Research

It is important to note that the information provided by Investics Research is based on publicly available data and own knowledge, which has been gathered and analyzed from a variety of sources. While every effort has been made to ensure the accuracy and completeness of the information provided, it is not guaranteed to be free from errors or omissions. All forecasts and estimates are based on information that has been obtained from public sources that are considered to be reliable. The sources include but are not limited to, company announcements, exchange filings, presentations, etc. Investics does not guarantee the accuracy and completeness of the forecasts, estimates, and/or other information.

Equity Bottom-up Research

Equity Bottom-Up

Philippine Stock Exchange / Equity Bottom-Up

Philippine Stock Exchange Inc. is a self-regulatory organization that provides a fair, efficient, transparent and orderly market for the buying and selling of securities.

<ul>
<li>We are gradually building a high-conviction coverage of ideas for the mid and small-caps in the Philippines.</li>
<li>We set criteria for high ROCE, reasonable growth (10-15% YoY), strong balance sheets, and reasonable capital allocation (dividend yields), all ingredients for being multi-baggers.</li>
<li>We preview earnings for our top picks: <a href="https://www.smartkarma.com/entities/digiplus-interactive-corp" target="_blank" data-smartkarma-citation="entities:23060:1" rel="noopener">DigiPlus Interactive (PLUS PM)</a>, <a href="https://www.smartkarma.com/entities/ginebra-san-miguel-inc" target="_blank" data-smartkarma-citation="entities:23029:1" rel="noopener">Ginebra San Miguel (GSMI PM)</a>, <a href="https://www.smartkarma.com/entities/the-keepers-holdings-inc" target="_blank" data-smartkarma-citation="entities:23003:1" rel="noopener">The Keepers Holdings (KEEPR PM), </a>and the <a href="https://www.smartkarma.com/entities/philippine-stock-exchange-inc" target="_blank" data-smartkarma-citation="entities:23182:1" rel="noopener">Philippine Stock Exchange (PSE PM)</a> </li>
</ul>


We are gradually building a high-conviction coverage of ideas for the mid and small-caps in the Philippines.
We set criteria for high ROCE, reasonable growth (10-15% YoY), strong balance sheets, and reasonable capital allocation (dividend yields), all ingredients for being multi-baggers.
We preview earnings for our top picks: DigiPlus Interactive (PLUS PM), Ginebra San Miguel (GSMI PM), The Keepers Holdings (KEEPR PM), and the Philippine Stock Exchange (PSE PM) 


Shortlist of High Conviction Philippines Equity Ideas - January 2025

Commodities

Copper is a chemical element with symbol Cu (from Latin: cuprum) and atomic number 29. It is a soft, malleable and ductile metal with very high thermal and electrical conductivity. A freshly exposed surface of pure copper has a reddish-orange color. It is used as a conductor of heat and electricity, as a building material and as a constituent of various metal alloys, such as Sterling silver used in jewelry, cupronickel used to make marine hardware and coins and constantan used in strain gauges and thermocouples for temperature measurement.

<ul>
<li>Copper prices finished up over 9000 USD/ton again this week after hovering around 3-5% of that level for close to a month. </li>
<li>The COMEX spread has reached a 10-week high, while the Yangshan premium shows signs of investor bullishness as it closes in on the 80 USD/ton. </li>
<li>With better TSF numbers from China and a slightly more optimistic picture of demand, we head into 2025 feeling better about copper pricing. </li>
</ul>


Copper prices finished up over 9000 USD/ton again this week after hovering around 3-5% of that level for close to a month. 
The COMEX spread has reached a 10-week high, while the Yangshan premium shows signs of investor bullishness as it closes in on the 80 USD/ton. 
With better TSF numbers from China and a slightly more optimistic picture of demand, we head into 2025 feeling better about copper pricing. 


Copper Tracker 20th Jan 2025: Encouraging China TSF Numbers To Boost Future Demand?

Iron ores are rocks and minerals from which metallic iron can be economically extracted. The ores are usually rich in iron oxides and vary in color from dark grey, bright yellow, deep purple, to rusty red. The iron itself is usually found in the form of magnetite (Fe3O4, 72.4% Fe), hematite (Fe2O3, 69.9% Fe), goethite (FeO(OH), 62.9% Fe), limonite (FeO(OH).n(H2O)) or siderite (FeCO3, 48.2% Fe).

<ul>
<li>Iron ore bounced back 7.7% last week to finish at 104 USD/ton. The short-term bullishness was due to temporary port closures for Hedland and Dampier due to cyclone warnings. </li>
<li>China TSF exceeded expectations for December, coming in at 2.85 trillion RMB, up 47% year over year (compared to street expectations of 2.15 trillion RMB). </li>
<li>We like the small-cap <a href="https://www.smartkarma.com/entities/fenix-resources-ltd" target="_blank" data-smartkarma-citation="entities:7405:1" rel="noopener">Fenix Resources (FEX AU). </a>Read our research <a href="https://www.smartkarma.com/insights/fenix-resources-fex-au-deep-value-35-of-mkt-cap-in-cash-2-5x-pe-0-3-ev-ebitda-on-ramp-up" target="_blank" data-smartkarma-citation="insights:171736" rel="noopener">Fenix Resources (FEX AU): Deep Value, &gt;35% of Mkt Cap in Cash, 2.5x PE/0.3 EV-EBITDA on Ramp Up</a>. </li>
</ul>


Iron ore bounced back 7.7% last week to finish at 104 USD/ton. The short-term bullishness was due to temporary port closures for Hedland and Dampier due to cyclone warnings. 
China TSF exceeded expectations for December, coming in at 2.85 trillion RMB, up 47% year over year (compared to street expectations of 2.15 trillion RMB). 
We like the small-cap Fenix Resources (FEX AU). Read our research Fenix Resources (FEX AU): Deep Value, &gt;35% of Mkt Cap in Cash, 2.5x PE/0.3 EV-EBITDA on Ramp Up. 


Iron Ore Tracker (20-Jan-2025): Temporary Closure of Hedland and Dampier to Boost Prices

Mongolian Mining Corporation produces coking coal.  The Company operates the Ukhaa Khudag mine in Mongolia.

<ul>
<li>
<span><a href="https://www.smartkarma.com/entities/mongolian-mining-corp" target="_blank" rel="noopener">Mongolian Mining (975 HK)</a> reported its <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2025/0117/2025011700604.pdf" target="_blank" rel="noopener">production update</a>, which is in line with our estimates for 7.9 million tons of washed coal sold for FY24.</span> </li>
<li><span>The company commenced <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2025/0116/2025011600922.pdf" target="_blank" rel="noopener">buybacks</a>, purchasing 0.26% of its outstanding shares at 6.65 HKD/share. We believe the company will also <a href="https://www.smartkarma.com/insights/mongolia-mining-corp-975-hk-play-on-coking-coal-price-with-growth-optionality" target="_blank" rel="noopener">announce a dividend</a> in its upcoming results. </span></li>
<li>After the massive correction in share price owing to a weaker coking coal price, the stock trades at 4.2x PE, 1.9x EV-EBITDA, and a 7-10% dividend yield (30-50% payout ratio). </li>
</ul>



Mongolian Mining (975 HK) reported its production update, which is in line with our estimates for 7.9 million tons of washed coal sold for FY24. 
The company commenced buybacks, purchasing 0.26% of its outstanding shares at 6.65 HKD/share. We believe the company will also announce a dividend in its upcoming results. 
After the massive correction in share price owing to a weaker coking coal price, the stock trades at 4.2x PE, 1.9x EV-EBITDA, and a 7-10% dividend yield (30-50% payout ratio). 


Mongolia Mining (975 HK): Q4 2024 Operational Updates and Commencement of Buybacks

UMP Healthcare Holdings Ltd. offers healthcare solutions provider. The Company provides services for medical and dental needs. UMP serves both contract and plan customers.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/ump-healthcare-holdings-ltd" target="_blank" rel="noopener">UMP Healthcare (722 HK)</a> will report its results in late February. We estimate low single-digit revenue growth of 3% YoY, in line with the past two semiannuals.</li>
<li>We flagged cost-cutting initiatives in <a href="https://www.smartkarma.com/insights/ump-healthcare-722-hk-postcard-from-hong-kong-and-webinar-updates" target="_blank" data-smartkarma-citation="insights:166790" rel="noopener">UMP Healthcare (722 HK): Postcard From Hong Kong and Webinar Updates</a>, which would result in 25% YoY profit growth. </li>
<li>Trading at 6.4x FY25e PE, with a 10% dividend yield and 85% of the market capitalization in net cash and investments, the stock has the potential to double. </li>
</ul>



UMP Healthcare (722 HK) will report its results in late February. We estimate low single-digit revenue growth of 3% YoY, in line with the past two semiannuals.
We flagged cost-cutting initiatives in UMP Healthcare (722 HK): Postcard From Hong Kong and Webinar Updates, which would result in 25% YoY profit growth. 
Trading at 6.4x FY25e PE, with a 10% dividend yield and 85% of the market capitalization in net cash and investments, the stock has the potential to double. 


UMP Healthcare (722 HK): Earnings Preview for H1 FY25

A buy-side analyst with over 15 years of experience investing in Asian markets and specializing in the mid-small cap space, emphasizing value investing in companies with good free cash flows/dividends and long-term holding horizons. 
Exempt Financial Adviser (EFA) under CrossASEAN Research Pte Ltd. It is important to note that the information provided by Investics Research is based on publicly available data and own knowledge, which has been gathered and analyzed from a variety of sources. While every effort has been made to ensure the accuracy and completeness of the information provided, it is not guaranteed to be free from errors or omissions. All forecasts and estimates are based on information that has been obtained from public sources that are considered to be reliable. The sources include but are not limited to, company announcements, exchange filings, presentations, etc. Investics does not guarantee the accuracy and completeness of the forecasts, estimates, and/or other information.

Sameer Taneja
Equity, Bottom-up Analyst
• Investics Research

Shortlist of High Conviction Philippines Equity Ideas - January 2025

We compile our selection of small and mid-cap names for the Philippines with our desired characteristics of high dividend yields, value, and margin...

Sameer Taneja

Copper Tracker 20th Jan 2025: Encouraging China TSF Numbers To Boost Future Demand?

We highlight the expanding bullish spreads of COMEX and Yangshan for copper. We highlight the bullish narrative and provide updates on stocks in...

Sameer Taneja

Iron Ore Tracker (20-Jan-2025): Temporary Closure of Hedland and Dampier to Boost Prices

Iron ore supply has been temporarily curtailed by inclement weather in Australia and bounced back to >100 USD/ton. January is an important month as...

Sameer Taneja

Mongolia Mining (975 HK): Q4 2024 Operational Updates and Commencement of Buybacks

We provide an operational update for Mongolia Mining's (975 HK) Q4 2024. Trading at 4.2x FY24e PE and 1.9x EV-EBITDA, we expect the stock to...

Sameer Taneja

UMP Healthcare (722 HK): Earnings Preview for H1 FY25

We preview the H1 FY25 earnings for UMP Healthcare (722 HK), which will declare its interim results by the end of February.

Sameer Taneja