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Granite Bay Capital

An innovation focussed investment company

Granite Bay Capital is an innovation focussed investment company with a deep focus on the companies at the leading edge of innovation across major themes such as AI, ubiquitous computing, sustainability, automation and longevity.

Thematic (Sector/Industry)

Deep Dive - Facebook Metaverse This week I want to do a deep dive into the Metaverse after Facebook (FB) announced its plan to hire 10,000 people for their Metaverse project. It’s a theme that will run through many future editions of WIRE and is something I’ve also dived into a little here and here with Future Sandwich’s Tommy McCubbin.

Deep Dive - Facebook Metaverse This week I want to do a deep dive into the Metaverse after Facebook (FB) announced its plan to hire 10,000 people for their Metaverse project. It’s a theme that will run through many future editions of WIRE and is something I’ve also dived into a little here and here with Future Sandwich’s Tommy McCubbin.

Forensic Analyst

Jason Yap, CFA

Equity Bottom-Up

<div><a href="https://www.smartkarma.com/entities/parade-technologies-ltd" target="_blank" data-smartkarma-citation="entities:6987:1" rel="noopener">Parade Technologies (4966 TT)</a> is a fabless semiconductor that specialises in high-speed video interfacing and processing products, and expected to see large passive inflows from an MSCI rebalance (<a href="https://www.smartkarma.com/insights/msci-nov-2021-index-rebalance-preview-go" target="_blank" data-smartkarma-citation="insights:59067" rel="noopener">MSCI Nov 2021 Index Rebalance Preview: Go!</a>).</div>The review period for price cut-off started on 18 October 2021 and will run to 29 October 2021. MSCI is expected to announce the results of the review on 12 November 2021, with changes implemented after the close of trading on 30 November 2021. In this Insight, we provide a primer on Parade Technologies including an analysis in respect of where in the value chain it sits, in particular as a key display supplier to <a href="https://www.smartkarma.com/entities/apple-inc" target="_blank" data-smartkarma-citation="entities:666:1" rel="noopener">Apple Inc (AAPL US)</a>, potential investment catalysts, and valuation.

Parade Technologies (4966 TT) is a fabless semiconductor that specialises in high-speed video interfacing and processing products, and expected to see large passive inflows from an MSCI rebalance (MSCI Nov 2021 Index Rebalance Preview: Go!).The review period for price cut-off started on 18 October 2021 and will run to 29 October 2021. MSCI is expected to announce the results of the review on 12 November 2021, with changes implemented after the close of trading on 30 November 2021. In this Insight, we provide a primer on Parade Technologies including an analysis in respect of where in the value chain it sits, in particular as a key display supplier to Apple Inc (AAPL US), potential investment catalysts, and valuation. 

Parade Technologies (4966 TT) - Expensive Now, But Accumulate on Weakness Given Structural Positives

Overseas Chinese Equities, Aequitas Research

Ming Lu

Overseas Chinese Equities

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

<ul>
<li>In 3Q21, the whole smartphone market was weak due to the chip shortage.</li>
<li>Apple took back the No. 2 place from Xiaomi in shipment market share.</li>
<li>Samsung is self-supporting in chip supply, but Xiaomi is not.</li>
<li>Both of Apple and Samsung's margins are higher than Xiaomi's.</li>
</ul>


In 3Q21, the whole smartphone market was weak due to the chip shortage.
Apple took back the No. 2 place from Xiaomi in shipment market share.
Samsung is self-supporting in chip supply, but Xiaomi is not.
Both of Apple and Samsung's margins are higher than Xiaomi's.


Xiaomi (1810 HK): Weak Market in 3Q21 and Not Competitive Internationally

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

*Fintech Hits Are Coming: Regulators have forced the capitulation of internet anti-competitive behavior. Most recently, both Alibaba (BABA.US) [Alibaba} and Tencent (700.HK) [Tencent] have stopped blocking rivals’ links which prevented users to purchase goods using competitor payment apps. This is a big deal, given that FinTech represented a growing 30.3% of revenue for Tencent at 2Q21. The more Tencent relies on Fintech to support growth, the more alarming the moves by Alibaba and other competitors are; and*Prior To The War On Gaming, Tencent’s Results Have Already Deteriorated: Tencent’s 2Q21 GAAP net income declined CNY 5.2 bn (10.8%) linked quarter – and were of poor quality. Results were challenged by: cost of revenue increase; operating expense increase; losses in associates; higher impairment charges; and weaker online games. Were it not for the artificially lower tax rate, results would have been even more challenged. We can't wait to see what the impact of mainland China’s latest regulatory maneuvers will have on Tencent’s 3Q21 results out on November 10th.

*Fintech Hits Are Coming: Regulators have forced the capitulation of internet anti-competitive behavior. Most recently, both Alibaba (BABA.US) [Alibaba} and Tencent (700.HK) [Tencent] have stopped blocking rivals’ links which prevented users to purchase goods using competitor payment apps. This is a big deal, given that FinTech represented a growing 30.3% of revenue for Tencent at 2Q21. The more Tencent relies on Fintech to support growth, the more alarming the moves by Alibaba and other competitors are; and*Prior To The War On Gaming, Tencent’s Results Have Already Deteriorated: Tencent’s 2Q21 GAAP net income declined CNY 5.2 bn (10.8%) linked quarter – and were of poor quality. Results were challenged by: cost of revenue increase; operating expense increase; losses in associates; higher impairment charges; and weaker online games. Were it not for the artificially lower tax rate, results would have been even more challenged. We can't wait to see what the impact of mainland China’s latest regulatory maneuvers will have on Tencent’s 3Q21 results out on November 10th.  

Tencent Holdings – Under Severe Pressure

Covering IPOs, Healthcare and Technology Stocks

Andrei Zakharov

Algosun Global

Equity Capital Markets

<a href="https://www.smartkarma.com/entities/truecaller-ab" target="_blank" data-smartkarma-citation="entities:34462:1" rel="noopener">Truecaller AB (TRUEB SS)</a>  is expected to IPO this week. The company’s amended prospectus puts the expected price range at SEK 44.00-56.00 per Class B share, implying a market cap of ~19.6B SEK or ~$2.2B at midpoint of the price range on a fully diluted basis. The book-building procedure began on September 29 and continues until October 7. Truecaller’s Class B shares are expected to begin trading on Nasdaq Stockholm under the trading symbol “TRUE” on October 8. Carnegie Investment Bank, Goldman Sachs, J.P. Morgan and Citigroup Global Markets are joint global coordinators on the upcoming offering.

Truecaller AB (TRUEB SS)  is expected to IPO this week. The company’s amended prospectus puts the expected price range at SEK 44.00-56.00 per Class B share, implying a market cap of ~19.6B SEK or ~$2.2B at midpoint of the price range on a fully diluted basis. The book-building procedure began on September 29 and continues until October 7. Truecaller’s Class B shares are expected to begin trading on Nasdaq Stockholm under the trading symbol “TRUE” on October 8. Carnegie Investment Bank, Goldman Sachs, J.P. Morgan and Citigroup Global Markets are joint global coordinators on the upcoming offering.      

Truecaller IPO: Best-In-Class Caller ID And Spam Blocking App

United States

Apple Inc. designs, manufactures, and markets smartphones, personal computers, tablets, wearables and accessories, and sells a variety of related accessories. The Company also offers payment, digital content, cloud and advertising services. Apple Inc.'s customers are primarily in consumer, small & mid-sized business, education, enterprise and government markets worldwide.

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Apple (AAPL US)

Weekly Innovation Review (WIRE) #54

Deep Dive - Facebook Metaverse This week I want to do a deep dive into the Metaverse after Facebook (FB) announced its plan to hire 10,000 people...

Granite Bay Capital

Parade Technologies (4966 TT) - Expensive Now, But Accumulate on Weakness Given Structural Positives

We provide a primer on Parade Technologies including an analysis in respect of where in the value chain it sits, in particular as a key display...

Jason Yap, CFA

Xiaomi (1810 HK): Weak Market in 3Q21 and Not Competitive Internationally

In 3Q21, the smartphone market was weak due to the chip shortage. Apple took back the No. 2 place from Xiaomi in market share. Xiaomi has tech and...

Ming Lu

Tencent Holdings – Under Severe Pressure

TENCENT: Alibaba and Tencent have begun unblocking rivals’ app links. Prior to impact of the new regulations, Tencent’s results were already stressed.

Thomas J. Monaco

Truecaller IPO: Best-In-Class Caller ID And Spam Blocking App

Swedish caller identification and spam-call blocker unicorn Truecaller filed for an IPO on Nasdaq Stockholm and plans to raise more than $100M this...

Andrei Zakharov

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