Silver Point

Thomas J. Monaco

Independent Insight Provider

Silver Point is a boutique research firm that focuses on the broader financial services sector, with a particular focus on troubled institutions globally. 

Asia Ex Japan

Equity Bottom-Up

*Ssangyong Declares Bankruptcy: Purchased by Mahindra &amp; Mahindra (MM.IN) [M&amp;M] in 2011, the 74.7%-owned SsangYong Motor Company (003620.KS) [Ssangyong] in South Korea filed an application for commencement of the rehabilitation procedure with the Seoul Bankruptcy Court; and*M&amp;M Guarantee: Unfortunately for M&amp;M, it has provided a corporate guarantee on behalf of Ssangyong on loans up to IN 6.8bn. If no new investor steps in, M&amp;M will be required to pay the guarantee.

*Ssangyong Declares Bankruptcy: Purchased by Mahindra &amp; Mahindra (MM.IN) [M&amp;M] in 2011, the 74.7%-owned SsangYong Motor Company (003620.KS) [Ssangyong] in South Korea filed an application for commencement of the rehabilitation procedure with the Seoul Bankruptcy Court; and*M&amp;M Guarantee: Unfortunately for M&amp;M, it has provided a corporate guarantee on behalf of Ssangyong on loans up to IN 6.8bn. If no new investor steps in, M&amp;M will be required to pay the guarantee.

Mahindra & Mahindra – Ssanyong Goes Plotz

Equity L/S Analyst | Forensic Accounting | India, Yellowstone Equity

Ankit Agrawal, CFA

Equity L/S Analyst | Forensic Accounting | India

Cholamandalam Investment and Finance / Equity Bottom-Up

<a href="https://www.smartkarma.com/entities/cholamandalam-investment-and" target="_blank" data-smartkarma-citation="entities:17583:1" rel="noopener">Cholamandalam Investment and Finance (CIFC IN)</a> ["Chola"] is an Indian NBFC with a focus on vehicle financing, especially commercial vehicles (CV), in rural and semi-urban areas. With the economy getting back on track post lockdown, CV cycle is poised to witness disproportionate recovery after going through a depressed cycle over the past couple of years. With rural and semi-urban economy recovering faster and seeing stronger resilience, Chola's CV financing book has all the more reasons to cheer given its strong focus on tier-II and below towns. Below we dive-deep into Chola's competitive strengths and potential for strong growth in the near future.

Cholamandalam Investment and Finance (CIFC IN) ["Chola"] is an Indian NBFC with a focus on vehicle financing, especially commercial vehicles (CV), in rural and semi-urban areas. With the economy getting back on track post lockdown, CV cycle is poised to witness disproportionate recovery after going through a depressed cycle over the past couple of years. With rural and semi-urban economy recovering faster and seeing stronger resilience, Chola's CV financing book has all the more reasons to cheer given its strong focus on tier-II and below towns. Below we dive-deep into Chola's competitive strengths and potential for strong growth in the near future.

2021 High Conviction | Cholamandalam Investment: A High Quality Play on CV Cycle Recovery in India

Indian Accounting Research Analyst, Trudence Capital Advisors

Nitin Mangal

Indian Accounting Research Analyst

In our earlier extensive insight, <a href="https://www.smartkarma.com/insights/mahindra-and-mahindra-deceleration-accelerates-plateau-ahead" target="_blank" data-smartkarma-citation="insights:15530" rel="noopener">Mahindra and Mahindra: Deceleration Accelerates, Plateau Ahead</a> we spoke about how <a href="https://www.smartkarma.com/entities/mahindra-mahindra-ltd" target="_blank" data-smartkarma-citation="entities:16441:1" rel="noopener">Mahindra &amp; Mahindra (MM IN)</a> had lost its mojo in the Indian auto industry, after having a purple patch till early 2010s. We highlighted severe operational, strategic and financial concerns that plagued the company, and that it will continue to underperform the Auto sector post 2017.
M&amp;M has struggled to cope up with its historic prowess in the sector, and has been a victim to market share and momentum loss in several segments (Standalone basis). 
The company has also announced a reshuffle of its leadership back in Dec 2019, and consequently has undergone several strategic business changes ranging from exit of investments to new tie ups. As a result, there has been a lot of optimism in the market about a more than average possibility of a revival, and that M&amp;M will regain the fortress back.
However on the contrary, looking at the dismal recent-past track record of the company, it is a herculean task for the management to turn around and so these decisions must be watched closely in the medium to long run before jumping on to the conclusions.

In our earlier extensive insight, Mahindra and Mahindra: Deceleration Accelerates, Plateau Ahead we spoke about how Mahindra &amp; Mahindra (MM IN) had lost its mojo in the Indian auto industry, after having a purple patch till early 2010s. We highlighted severe operational, strategic and financial concerns that plagued the company, and that it will continue to underperform the Auto sector post 2017.
M&amp;M has struggled to cope up with its historic prowess in the sector, and has been a victim to market share and momentum loss in several segments (Standalone basis). 
The company has also announced a reshuffle of its leadership back in Dec 2019, and consequently has undergone several strategic business changes ranging from exit of investments to new tie ups. As a result, there has been a lot of optimism in the market about a more than average possibility of a revival, and that M&amp;M will regain the fortress back.
However on the contrary, looking at the dismal recent-past track record of the company, it is a herculean task for the management to turn around and so these decisions must be watched closely in the medium to long run before jumping on to the conclusions.

Mahindra and Mahindra: Refurbished but Still Fragile

Asian Insight Provider - Actionable ideas, CrossASEAN Research

Henry Soediarko

Asian Insight Provider - Actionable ideas

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

<a href="https://www.smartkarma.com/entities/nexteer-automotive-group-ltd" target="_blank" data-smartkarma-citation="entities:15483:1" rel="noopener">Nexteer Automotive (1316 HK)</a> share price has blown out in the past week, raising the question of whether it is time to sell or hold. 
The company has a pipeline of exciting and futuristic product innovation that will keep its existing customers (conventional automakers) happy while also winning more mandates in the EV industry.   
There will be a slight margin decline in the 2H 2020 from the North American customers but the increasing proportion of Chinese customers should help to plug the gap. The company is still trading on the 49% and 48% discount on PER and EV/EBITDA of its customers respectively.

Nexteer Automotive (1316 HK) share price has blown out in the past week, raising the question of whether it is time to sell or hold. 
The company has a pipeline of exciting and futuristic product innovation that will keep its existing customers (conventional automakers) happy while also winning more mandates in the EV industry.   
There will be a slight margin decline in the 2H 2020 from the North American customers but the increasing proportion of Chinese customers should help to plug the gap. The company is still trading on the 49% and 48% discount on PER and EV/EBITDA of its customers respectively.

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

In our October 1 Int’l Compass we highlighted our belief that the lows were in place for this recent correction and that, combined with mostly healthy market dynamics, a bullish outlook is appropriate if the MSCI ACWI (ACWI-US) is above $77 support and, if the MSCI EM (EEM-US) is above $42.30 support. These indexes and market dynamics have only improved since October 1. As a result, our outlook remains bullish and we continue to believe that the path of least resistance is higher for global equities. Below we summarize the basis for our bullish outlook. Open the attached file to read our complete International Strategy document, and to find links to detailed comments and recommendations for each of our 12 Sectors.

In our October 1 Int’l Compass we highlighted our belief that the lows were in place for this recent correction and that, combined with mostly healthy market dynamics, a bullish outlook is appropriate if the MSCI ACWI (ACWI-US) is above $77 support and, if the MSCI EM (EEM-US) is above $42.30 support. These indexes and market dynamics have only improved since October 1. As a result, our outlook remains bullish and we continue to believe that the path of least resistance is higher for global equities. Below we summarize the basis for our bullish outlook. Open the attached file to read our complete International Strategy document, and to find links to detailed comments and recommendations for each of our 12 Sectors.

Global Equity Strategy: Bullish Outlook Intact

India

Mahindra & Mahindra Ltd. manufactures automobiles, farm equipment and automotive components. The Company's automobile products include light, medium and heavy commercial vehicles, jeep type vehicles and passenger cars. Mahindra & Mahindra also manufactures agricultural tractors, agricultural implements, internal combustion engines, industrial petrol engines, spare parts and machine tools.

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Mahindra & Mahindra (MM IN)

Mahindra & Mahindra – Ssanyong Goes Plotz

MAHINDRA & MAHINDRA: 75% Owned Ssangyong Motors Declares Bankruptcy, and M&M Is Likely On The Hook For The Credit Guarantees.

Thomas J. Monaco

2021 High Conviction | Cholamandalam Investment: A High Quality Play on CV Cycle Recovery in India

Chola is a high quality franchise with a leading presence in the CV segment. As the CV cycle recovers in India, Chola has potential to deliver 50%+...

Ankit Agrawal, CFA

Mahindra and Mahindra: Refurbished but Still Fragile

Given dismal recent-past track record, it is a herculean task for the management to turn around and so these decisions must be watched closely...

Nitin Mangal

Nexteer (1316): What to Do Now?

The company's technological advantage has enabled it to have a pipeline of exciting and futuristic innovation that is ready to blow the auto...

Henry Soediarko

Global Equity Strategy: Bullish Outlook Intact

Read our complete International Strategy document to find detailed comments and recommendations for each of our 12 Sectors.

Vermilion Research

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