Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>Five weeks ago, JIC announced a delay in the commencement of the Tender Offer to buy <a href="https://www.smartkarma.com/entities/jsr-corp" target="_blank" data-smartkarma-citation="entities:17620:1" rel="noopener">JSR Corp (4185 JP)</a>, originally scheduled to start by end-December 2023. </li>
<li>In the <a href="https://www.j-ic.co.jp/en/news/pdf/E_20231219_JIC_JICC_PressRelease.pdf" target="_blank" rel="noopener">announcement</a>, they said they expected the deal to start by end-February. In the press conference afterwards, JIC CEO Yokoo <a href="https://www.reuters.com/world/asia-pacific/jic-chief-says-no-issues-with-chinese-antitrust-regulator-over-jsr-buyout-2023-12-20/" target="_blank" rel="noopener">said</a> "no particular issues with the Chinese regulator." </li>
<li>He then added he expected the deal to be done by March-end. Language is vague. I expect that means to start by then, but even then, annualised is now 30%.</li>
</ul>


Five weeks ago, JIC announced a delay in the commencement of the Tender Offer to buy JSR Corp (4185 JP), originally scheduled to start by end-December 2023. 
In the announcement, they said they expected the deal to start by end-February. In the press conference afterwards, JIC CEO Yokoo said "no particular issues with the Chinese regulator." 
He then added he expected the deal to be done by March-end. Language is vague. I expect that means to start by then, but even then, annualised is now 30%.


JSR (4185) - Very Juicy Arb Return At Expected Timeline

Quantitative Equity Analyst, DMA

Charlotte van Tiddens, CFA

Quantitative Equity Analyst

Technology-First Company

DMA is a technology-first company that provides an end-to-end SaaS solution to institutional investors. DMA enables regulated entities like asset managers, wealth managers, investment managers and financial advisors to connect their front and back office, break silos and reduce headcount.

Quantitative Analysis

<ul>
<li>Short duration US factor strategies outperformed in September as markets came under pressure (value and dividend yield).</li>
<li>Despite keeping rates unchanged on the 20th of September at 5.5% (upper bound), Fed Chair Powell indicated that rates would be kept higher for longer than initially anticipated.</li>
<li>In this note we explore the <em><strong>relative performance</strong></em> of US factor strategies through different interest rate cycles, to inform timing around factor/style rotation.</li>
</ul>


Short duration US factor strategies outperformed in September as markets came under pressure (value and dividend yield).
Despite keeping rates unchanged on the 20th of September at 5.5% (upper bound), Fed Chair Powell indicated that rates would be kept higher for longer than initially anticipated.
In this note we explore the relative performance of US factor strategies through different interest rate cycles, to inform timing around factor/style rotation.


US Factor Strategies: Value and Dividend Yield Outperform in September, Higher for Longer Narrative

Research from Asian Century Stocks, Asian Century Stocks

Michael Fritzell

Research from Asian Century Stocks

Providing financial journalism in the Asia-Pacific

Asian Century Stocks

Asian Century Stocks is a newsletter providing financial journalism for companies and stocks in the Asia-Pacific. 
The Asian Century Stocks logotype “百” stands for “one hundred” or a “century”. The economic centre of gravity is moving towards Asia. Yet most global investors are missing out.

Thematic (Sector/Industry)

<ul>
<li>The IVF industry is booming, driven by couples having children later in life as well as infertility problems.</li>
<li>There should be plenty of opportunities for IVF clinic operators, including for Jinxin Fertility which may benefit if the Chinese government introduces subsidies for IVF procedures. But the acquisitive nature of many IVF-related companies has caused their returns on equity and earnings per share growth to be weak.</li>
<li>One stock that trades at a low multiple with fat profit margins is Organon, though be aware of its ongoing patent cliffs, which may be the reason it was spun off in the first place.</li>
</ul>


The IVF industry is booming, driven by couples having children later in life as well as infertility problems.
There should be plenty of opportunities for IVF clinic operators, including for Jinxin Fertility which may benefit if the Chinese government introduces subsidies for IVF procedures. But the acquisitive nature of many IVF-related companies has caused their returns on equity and earnings per share growth to be weak.
One stock that trades at a low multiple with fat profit margins is Organon, though be aware of its ongoing patent cliffs, which may be the reason it was spun off in the first place.


Covering IPOs, Healthcare and Technology Stocks

Andrei Zakharov

Algosun Global

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/elastic-nv" target="_blank" data-smartkarma-citation="entities:27526:1" rel="noopener">Elastic NV (ESTC US)</a>  has grown its ARR from ~$207 million as of Jul-18 to ~$760 million today and may become a multi-billion dollar unicorn in the future.  </li>
<li>We like the subscription-based freemium business model, strong net expansion rate, and acceleration in revenue growth of Elastic Cloud business, which currently represents ~33% of total revenue. </li>
<li>Elastic Search is one of the most popular search engines globally, and the company’s products have been downloaded more than 350 million times since 2013. </li>
</ul>



Elastic NV (ESTC US)  has grown its ARR from ~$207 million as of Jul-18 to ~$760 million today and may become a multi-billion dollar unicorn in the future.  
We like the subscription-based freemium business model, strong net expansion rate, and acceleration in revenue growth of Elastic Cloud business, which currently represents ~33% of total revenue. 
Elastic Search is one of the most popular search engines globally, and the company’s products have been downloaded more than 350 million times since 2013. 


Elastic: High-Profile Search Company With Attractive Fundamentals

Global Healthcare Analyst

Tina Banerjee

<ul>
<li>
<a href="https://www.smartkarma.com/entities/ono-pharmaceutical-co-ltd" target="_blank" data-smartkarma-citation="entities:8979:1" rel="noopener">Ono Pharmaceutical (4528 JP)</a> is reporting decelerating revenue from its flagship drug, Opdivo. During H1FY25, domestic revenue from Opdivo decreased 17% YoY to ¥62.6B.</li>
<li>Opdivo will start to lose patent protection starting from 2028. Prolific commercialization of these new drugs will remain crucial for Ono riding the patent cliff successfully.</li>
<li>Ono shares plunged 36% over the last one year to trade at attractive valuation. In absence of any near-term growth catalyst, the shares are not expected to see much upside.</li>
</ul>



Ono Pharmaceutical (4528 JP) is reporting decelerating revenue from its flagship drug, Opdivo. During H1FY25, domestic revenue from Opdivo decreased 17% YoY to ¥62.6B.
Opdivo will start to lose patent protection starting from 2028. Prolific commercialization of these new drugs will remain crucial for Ono riding the patent cliff successfully.
Ono shares plunged 36% over the last one year to trade at attractive valuation. In absence of any near-term growth catalyst, the shares are not expected to see much upside.


Ono Pharmaceutical (4528 JP): Struggle Continues with Opdivo; Competition and Price Cuts Loom Large

United States

Merck & Co., Inc. is a global health care company that delivers health solutions through its prescription medicines, vaccines, biologic therapies, animal health, and consumer care products, which it markets directly and through its joint ventures. The Company has operations in pharmaceutical, animal health, and consumer care.

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Merck & (MRK UN)

JSR (4185) - Very Juicy Arb Return At Expected Timeline

JSR was a long-dated risk arb. People got tired of FUD and Flows, and sold. Now time is shorter and it offers a 24% yield to mid-May cashout of...

Travis Lundy

US Factor Strategies: Value and Dividend Yield Outperform in September, Higher for Longer Narrative

US rates and factor strategies: higher for longer likely to drive outperformance of short duration factor strategies, long US value short US growth.

DMA

IVF: Secular Growth for Decades to Come.

The IVF industry is booming, driven by couples having children later in life as well as infertility problems. There should be plenty of...

Asian Century Stocks

Elastic: High-Profile Search Company With Attractive Fundamentals

Elastic is a high-profile search technology company and we believe current valuations look attractive for long-term investors

Andrei Zakharov

Ono Pharmaceutical (4528 JP): Struggle Continues with Opdivo; Competition and Price Cuts Loom Large

Ono Pharmaceutical's revenue from Opdivo is slowing down. The company will face patent cliff in 2028. Shares are down 36% in past year, with...

Tina Banerjee

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JSR (4185) - Very Juicy Arb Return At Expected Timeline

JSR was a long-dated risk arb. People got tired of FUD and Flows, and sold. Now time is shorter and it offers a 24% yield to mid-May cashout of...

Travis Lundy

US Factor Strategies: Value and Dividend Yield Outperform in September, Higher for Longer Narrative

US rates and factor strategies: higher for longer likely to drive outperformance of short duration factor strategies, long US value short US growth.

DMA

IVF: Secular Growth for Decades to Come.

The IVF industry is booming, driven by couples having children later in life as well as infertility problems. There should be plenty of...

Asian Century Stocks

Elastic: High-Profile Search Company With Attractive Fundamentals

Elastic is a high-profile search technology company and we believe current valuations look attractive for long-term investors

Andrei Zakharov

Ono Pharmaceutical (4528 JP): Struggle Continues with Opdivo; Competition and Price Cuts Loom Large

​Ono Pharmaceutical's revenue from Opdivo is slowing down. The company will face patent cliff in 2028. Shares are down 36% in past year, with...

Tina Banerjee

Ono Pharmaceutical's revenue from Opdivo is slowing down. The company will face patent cliff in 2028. Shares are down 36% in past year, with...