Senior Credit Analyst, Lucror Analytics

Leonard Law, CFA

Senior Credit Analyst

High Yield Experts

Lucror Analytics

Lucror Analytics is a leading credit and ESG research specialist and a provider of technology solutions for differentiated fixed income strategies. Our roots are in bottom-up fundamental credit analysis with a specialization in high yield corporate credits from Europe, Asia and Latin America. We are one of few research specialists integrating ESG considerations with fundamental credit research through a dedicated ESG platform. Our ESG assessment covers five key criteria: Disclosure, E,S, & G Pillars, Controversies, ESG Impact on Credit and ESG Momentum.

Recognizing the importance and value-add of Factor Investing in fixed income, Lucror developed the Smart Quant Navigator (SQN), an intuitive platform that helps clients devise and implement factor-based strategies ranging from pure quant to active fundamental, with integrated ESG.

Our company has been at the forefront of developments in the fixed income markets, identifying opportunities and consistently delivering new products and value-adding solutions to clients. Lucror has close relationships with the largest and most reputable asset managers, family offices, hedge funds, investment and wealth managers globally.

Credit

In this month’s "In-Focus" section, we provide an update on Chinese developers’ JV exposure, including typical structures and the JV exposure of the companies under our coverage. The Asia Monthly focuses on providing updates on recent events, information on new issues and spread movements, as well as summarising our top picks, and discussing specific areas of interest in the "In-Focus" section. The Asia Monthly is intended to broaden investors' understanding of the Asian USD high-yield market.

   In this month’s "In-Focus" section, we provide an update on Chinese developers’ JV exposure, including typical structures and the JV exposure of the companies under our coverage.    The Asia Monthly focuses on providing updates on recent events, information on new issues and spread movements, as well as summarising our top picks, and discussing specific areas of interest in the "In-Focus" section. The Asia Monthly is intended to broaden investors' understanding of the Asian USD high-yield market. 

Asia HY Monthly - Chinese Developers' JV Exposure - Lucror Analytics

The Asia HY Trade Book for the month of May includes a summary of our recommendations, as well as our high-conviction ideas. The report also features relative-value charts and lists of the bonds in the Lucror Asia HY index.

   The Asia HY Trade Book for the month of May includes a summary of our recommendations, as well as our high-conviction ideas. The report also features relative-value charts and lists of the bonds in the Lucror Asia HY index. 

Asia HY Trade Book - May 2021 - Lucror Analytics

Trung Nguyen

JSW's Q4 and FY 2020-21 results were strong as expected, on the back of the swift increase in steel prices amid a seemingly robust recovery in the global and Indian economies. The financial risk profile has improved. Liquidity is adequate. However, we remain cautious of the commodity businesses' cyclicality. Steel prices and profitability at Indian steel makers are currently at record highs. JSW's profitability, specifically in terms of unit economy at INR 20 k per tonne, appears to be at the peak of the cycle. It is unclear if this strong operating environment can be sustained. While Indian steel makers appear confident that the positive situation will continue, we note that Chinese policies can often be unpredictable and can significantly influence the global commodity markets. We revise our LARA to "Medium Risk" from "High Risk", given JSW's resilient operating performance amid challenging times (i.e. 2019 and 2020). The current robust balance sheet should allow the company to weather the industry's cyclicality.

  JSW's Q4 and FY 2020-21 results were strong as expected, on the back of the swift increase in steel prices amid a seemingly robust recovery in the global and Indian economies. The financial risk profile has improved. Liquidity is adequate.   However, we remain cautious of the commodity businesses' cyclicality. Steel prices and profitability at Indian steel makers are currently at record highs. JSW's profitability, specifically in terms of unit economy at INR 20 k per tonne, appears to be at the peak of the cycle. It is unclear if this strong operating environment can be sustained. While Indian steel makers appear confident that the positive situation will continue, we note that Chinese policies can often be unpredictable and can significantly influence the global commodity markets.   We revise our LARA to "Medium Risk" from "High Risk", given JSW's resilient operating performance amid challenging times (i.e. 2019 and 2020). The current robust balance sheet should allow the company to weather the industry's cyclicality. 

JSW Steel - Earnings Flash - FY 2020-21 Results - Lucror Analytics

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.<ul><li><a href='#lucror-entity-18561'>JSW Steel Ltd</a></li></ul>

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.JSW Steel Ltd

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Event-Driven

Asia Index Private Limited has announced the changes to the <a href="https://www.smartkarma.com/entities/s-p-bse-sensex-index" target="_blank" data-smartkarma-citation="entities:31494:1" rel="noopener">S&amp;P BSE SENSEX Index (SENSEX INDEX)</a> for the upcoming review in June. The rebalance will be effective from the open on 21 June and passive funds will need to trade at the close (VWAP over the last 30 minutes of trading) on 18 June.<a href="https://www.smartkarma.com/entities/tata-steel-ltd" target="_blank" data-smartkarma-citation="entities:20934:1" rel="noopener">Tata Steel Ltd (TATA IN)</a> will be included in the index replacing <a href="https://www.smartkarma.com/entities/oil-natural-gas-corp-ltd" target="_blank" data-smartkarma-citation="entities:3456:1" rel="noopener">Oil &amp; Natural Gas Corp (ONGC IN)</a>.<a href="https://www.smartkarma.com/entities/wipro-ltd" target="_blank" data-smartkarma-citation="entities:15360:1" rel="noopener">Wipro Ltd (WPRO IN)</a> was the highest ranking non-constituent but the Index Committee went with <a href="https://www.smartkarma.com/entities/tata-steel-ltd" target="_blank" data-smartkarma-citation="entities:20934:1" rel="noopener">Tata Steel Ltd (TATA IN)</a> to reduce the underweight of the Materials sector in the <a href="https://www.smartkarma.com/entities/s-p-bse-sensex-index" target="_blank" data-smartkarma-citation="entities:31494:1" rel="noopener">S&amp;P BSE SENSEX Index (SENSEX INDEX)</a> vs the BSE All Cap index.<a href="https://www.smartkarma.com/entities/tata-steel-ltd" target="_blank" data-smartkarma-citation="entities:20934:1" rel="noopener">Tata Steel Ltd (TATA IN)</a> was deleted from the <a href="https://www.smartkarma.com/entities/s-p-bse-sensex-index" target="_blank" data-smartkarma-citation="entities:31494:1" rel="noopener">S&amp;P BSE SENSEX Index (SENSEX INDEX)</a> in December and makes its way back into the index after a big rally while out of the index.Passive funds will need to buy 0.33 days of ADV on <a href="https://www.smartkarma.com/entities/tata-steel-ltd" target="_blank" data-smartkarma-citation="entities:20934:1" rel="noopener">Tata Steel Ltd (TATA IN)</a> and sell 1.63 days of ADV on <a href="https://www.smartkarma.com/entities/oil-natural-gas-corp-ltd" target="_blank" data-smartkarma-citation="entities:3456:1" rel="noopener">Oil &amp; Natural Gas Corp (ONGC IN)</a>. The actual impact will be higher since the delivery volumes on both stocks are much lower, especially on <a href="https://www.smartkarma.com/entities/tata-steel-ltd" target="_blank" data-smartkarma-citation="entities:20934:1" rel="noopener">Tata Steel Ltd (TATA IN)</a>.

Asia Index Private Limited has announced the changes to the S&amp;P BSE SENSEX Index (SENSEX INDEX) for the upcoming review in June. The rebalance will be effective from the open on 21 June and passive funds will need to trade at the close (VWAP over the last 30 minutes of trading) on 18 June.Tata Steel Ltd (TATA IN) will be included in the index replacing Oil &amp; Natural Gas Corp (ONGC IN).Wipro Ltd (WPRO IN) was the highest ranking non-constituent but the Index Committee went with Tata Steel Ltd (TATA IN) to reduce the underweight of the Materials sector in the S&amp;P BSE SENSEX Index (SENSEX INDEX) vs the BSE All Cap index.Tata Steel Ltd (TATA IN) was deleted from the S&amp;P BSE SENSEX Index (SENSEX INDEX) in December and makes its way back into the index after a big rally while out of the index.Passive funds will need to buy 0.33 days of ADV on Tata Steel Ltd (TATA IN) and sell 1.63 days of ADV on Oil &amp; Natural Gas Corp (ONGC IN). The actual impact will be higher since the delivery volumes on both stocks are much lower, especially on Tata Steel Ltd (TATA IN). 

Sensex Index Rebalance: Tata Steel IN, ONGC OUT

India

JSW Steel Limited is an integrated steel producer with manufacturing facilities in Karnataka, Tamil Nadu and the western state of Maharashtra. The Company produces products including hot rolled coils, cold rolled coils, wire rods, galvanized coils and sheets.

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JSW Steel Ltd (JSTL IN)

Asia HY Monthly - Chinese Developers' JV Exposure - Lucror Analytics

In this month’s "In-Focus" section, we provide an update on Chinese developers’ JV exposure, including typical structures and the JV exposure of...

Lucror Analytics

Asia HY Trade Book - May 2021 - Lucror Analytics

The Asia HY Trade Book for the month of May includes a summary of our recommendations, as well as our high-conviction ideas. The report also...

Lucror Analytics

JSW Steel - Earnings Flash - FY 2020-21 Results - Lucror Analytics

JSW's Q4 and FY 2020-21 results were strong as expected, on the back of the swift increase in steel prices amid a seemingly robust recovery in...

Lucror Analytics

Morning Views Asia : JSW Steel Ltd

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region,...

Lucror Analytics

Sensex Index Rebalance: Tata Steel IN, ONGC OUT

Tata Steel will replace ONGC in the Sensex after the close of trading on 18 June. Tata Steel is back in the index after a 6 month break. Rebalance...

Brian Freitas

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