Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

Event-Driven

<ul>
<li>In this insight, we discuss the potential sale of SK Specialty by SK Inc (034730 KS) which owns 100% stake in the company. </li>
<li>If SK Inc could sell SK Specialty at about 3 trillion won to 4 trillion won, this could reduce significantly reduce debt burden of SK Inc.</li>
<li>Our base case NAV value per share for SK Inc is 203,288 won per share, representing 38% upside from current levels.</li>
</ul>


In this insight, we discuss the potential sale of SK Specialty by SK Inc (034730 KS) which owns 100% stake in the company. 
If SK Inc could sell SK Specialty at about 3 trillion won to 4 trillion won, this could reduce significantly reduce debt burden of SK Inc.
Our base case NAV value per share for SK Inc is 203,288 won per share, representing 38% upside from current levels.


Potential Sale of SK Specialty and Deleveraging of the SK Group - Impact on SK Inc and NAV Analysis

Tracking developments across tech supply chains, Tech Supply Chain Tracker

Tech Supply Chain Tracker

Tracking developments across tech supply chains

Equity Bottom-Up

<ul><li>BOE's B16 OLED commitment boosts Korean suppliers, Wonik to see surge in orders</li><li>Offshore wind delays in Taiwan lead to focus on Japan and Korea for opportunities</li><li>Onsemi chosen to power VW EV, Elon Musk supports Trump's EV policies, tariff war on chips impacts consumers and companies</li></ul>

BOE's B16 OLED commitment boosts Korean suppliers, Wonik to see surge in ordersOffshore wind delays in Taiwan lead to focus on Japan and Korea for opportunitiesOnsemi chosen to power VW EV, Elon Musk supports Trump's EV policies, tariff war on chips impacts consumers and companies

Tech Supply Chain Tracker (25-Jul-2024): BOE boosts S. Korean suppliers, Wonik gets more orders

Asia Pac IPO & Placement Research, China biotech, Aequitas Research

Ke Yan, CFA, FRM

Asia Pac IPO & Placement Research, China biotech

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.

Quantitative Analysis

<ul>
<li>We analyzed the changes in short interest of KRX Stocks as of Jun 28th which has an aggregated short interest worth USD5.9bn.</li>
<li>We tabulate league table for top short by value and short as multiple of ADT, as well as weekly increases &amp; decreases in short value, short as multiple of ADT.</li>
<li>We highlight short interest changes in Lg Electronics, Hyundai Motor.</li>
</ul>


We analyzed the changes in short interest of KRX Stocks as of Jun 28th which has an aggregated short interest worth USD5.9bn.
We tabulate league table for top short by value and short as multiple of ADT, as well as weekly increases &amp; decreases in short value, short as multiple of ADT.
We highlight short interest changes in Lg Electronics, Hyundai Motor.


KRX Short Interest Weekly (Jun 28th): Lg Electronics, Hyundai Motor

Taiwan Tech Focused Senior Analyst

Patrick Liao

Novatek Microelectronics Corp / Equity Bottom-Up

<ul>
<li>We expect Novatek Microelectronics Corp (3034 TT) to achieve approximately a 5% QoQ growth in revenue and relatively flat gross margin (GM) QoQ in 3Q24.</li>
<li>
<a href="https://www.smartkarma.com/entities/semiconductor-manufacturing-international-corp-smic" target="_blank" data-smartkarma-citation="entities:14231:1" rel="noopener">Semiconductor Manufacturing International Corp (SMIC) (981 HK)</a> and HLMC are capable of producing DDICs at 40nm and below.</li>
<li>Novatek is experiencing a decline in demand for 55nm Touch with Display Driver (TDDI) in 3Q24.</li>
</ul>


We expect Novatek Microelectronics Corp (3034 TT) to achieve approximately a 5% QoQ growth in revenue and relatively flat gross margin (GM) QoQ in 3Q24.

Semiconductor Manufacturing International Corp (SMIC) (981 HK) and HLMC are capable of producing DDICs at 40nm and below.
Novatek is experiencing a decline in demand for 55nm Touch with Display Driver (TDDI) in 3Q24.


Novatek (3034.TT): To Achieve a ~5% QoQ Growth in Revenue and Relatively Flat GM QoQ in 3Q24

United Microelectronics Corp / Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/united-microelectron-sp-adr" target="_blank" data-smartkarma-citation="entities:11540:1" rel="noopener">United Microelectron Sp Adr (UMC US)</a> 3Q24 outlook could be showing a slightly upside quarter over quarter and the gross margin is approaching to ~30%.</li>
<li>We estimate that UMC's overall utilization in 3Q24 will be around 65-70%, with 12” at 70-75% and 8” at 60%.</li>
<li>UMC is benefiting from Novatek shipping OLED DDIC to <a href="https://www.smartkarma.com/entities/apple-inc" target="_blank" data-smartkarma-citation="entities:666:1" rel="noopener">Apple (AAPL US)</a> in 3Q24.</li>
</ul>



United Microelectron Sp Adr (UMC US) 3Q24 outlook could be showing a slightly upside quarter over quarter and the gross margin is approaching to ~30%.
We estimate that UMC's overall utilization in 3Q24 will be around 65-70%, with 12” at 70-75% and 8” at 60%.
UMC is benefiting from Novatek shipping OLED DDIC to Apple (AAPL US) in 3Q24.


UMC (2303.TT; UMC.US): The Outlook for 3Q24 Has Reached a Slightly Upside QoQ.

South Korea

LG Display Co., Ltd. develops and manufactures digital display products.  The Company's products include thin film transistor-liquid crystal displays (TFT-LCD) for notebook and desktop computer monitors, TVs, mobile phones, and medical equipment.  LG Display provides its products mainly to overseas markets.

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LG Display (034220 KS)

Potential Sale of SK Specialty and Deleveraging of the SK Group - Impact on SK Inc and NAV Analysis

In this insight, we discuss the potential sale of SK Specialty by SK Inc (034730 KS) which owns 100% stake in the company. Our NAV value of SK Inc...

Douglas Kim

Tech Supply Chain Tracker (25-Jul-2024): BOE boosts S. Korean suppliers, Wonik gets more orders

South Korean OLED suppliers benefit from BOE's B16 commitment, Taiwan's wind industry looks to Japan and Korea, Onsemi powers VW EV, Taiwan's AI...

Tech Supply Chain Tracker

KRX Short Interest Weekly (Jun 28th): Lg Electronics, Hyundai Motor

We analyzed KRX short interest report for the past week and highlighted short interest changes in Lg Electronics, Hyundai Motor.

Ke Yan, CFA, FRM

Novatek (3034.TT): To Achieve a ~5% QoQ Growth in Revenue and Relatively Flat GM QoQ in 3Q24

Novatek Microelectronics Corp expected to see 5% QoQ revenue growth in 3Q24, while facing declining demand for 55nm TDDI. SMIC and HLMC can...

Patrick Liao

UMC (2303.TT; UMC.US): The Outlook for 3Q24 Has Reached a Slightly Upside QoQ.

UMC's 3rd quarter outlook shows a slight upside, with estimated overall utilization at 65-70% and benefits from Novatek shipping OLED DDIC to Apple.

Patrick Liao

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52-week Range

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Potential Sale of SK Specialty and Deleveraging of the SK Group - Impact on SK Inc and NAV Analysis

In this insight, we discuss the potential sale of SK Specialty by SK Inc (034730 KS) which owns 100% stake in the company. Our NAV value of SK Inc...

Douglas Kim

Tech Supply Chain Tracker (25-Jul-2024): BOE boosts S. Korean suppliers, Wonik gets more orders

South Korean OLED suppliers benefit from BOE's B16 commitment, Taiwan's wind industry looks to Japan and Korea, Onsemi powers VW EV, Taiwan's AI...

Tech Supply Chain Tracker

KRX Short Interest Weekly (Jun 28th): Lg Electronics, Hyundai Motor

We analyzed KRX short interest report for the past week and highlighted short interest changes in Lg Electronics, Hyundai Motor.

Ke Yan, CFA, FRM

Novatek (3034.TT): To Achieve a ~5% QoQ Growth in Revenue and Relatively Flat GM QoQ in 3Q24

​Novatek Microelectronics Corp expected to see 5% QoQ revenue growth in 3Q24, while facing declining demand for 55nm TDDI. SMIC and HLMC can...

Patrick Liao

UMC (2303.TT; UMC.US): The Outlook for 3Q24 Has Reached a Slightly Upside QoQ.

​UMC's 3rd quarter outlook shows a slight upside, with estimated overall utilization at 65-70% and benefits from Novatek shipping OLED DDIC to Apple.

Patrick Liao

Novatek Microelectronics Corp expected to see 5% QoQ revenue growth in 3Q24, while facing declining demand for 55nm TDDI. SMIC and HLMC can...

UMC's 3rd quarter outlook shows a slight upside, with estimated overall utilization at 65-70% and benefits from Novatek shipping OLED DDIC to Apple.