Energy Transition | AI | Shifting World Order, Mint Finance

Suhas Reddy

Energy Transition | AI | Shifting World Order

Deep Fundamental Analysis

Mint Finance

Mint Finance's investment research blends deep fundamental analysis with technical & quant insights. Investment strategies straddle across multiple asset classes with risk management embedded into every trade to deliver an outsized reward-to-risk ratio.

Mint Finance's research is centered around three key themes. First, energy transition and climate change. Second, artificial intelligence. Third, shifting world order with its impact across politics and monetary economics.

Thematic (Sector/Industry)

<ul>
<li>Growth in commercial real estate to be subdued in 2024 due to weak demand, especially for office spaces.</li>
<li>Concerns over CRE loan defaults grow stronger as the industry faces a liquidity crunch.</li>
<li>Delinquency rates of commercial real estate loans rise for five consecutive quarters till Q32023.</li>
</ul>


Growth in commercial real estate to be subdued in 2024 due to weak demand, especially for office spaces.
Concerns over CRE loan defaults grow stronger as the industry faces a liquidity crunch.
Delinquency rates of commercial real estate loans rise for five consecutive quarters till Q32023.


Rough Road Ahead for US Commercial Real Estate but Industrial CRE Is Rooted to Outperform Others

Research Firm with a Qualitative Overlay, Pearl Gray Equity and Research

Pearl Gray Equity and Research

Research Firm with a Qualitative Overlay

Quantitative fund & research firm with a qualitative overlay. 

Our coverage: General U.S. with a skew towards the primary sector. 

Methods: Smart Beta/Factor Pricing, Neural Networks, Street Gossip, and Common Sense.

Equity Bottom-Up

<ul>
<li>A cyclical pivot within the retail space is likely as consumer sentiment in the U.S. and the United Kingdom has started recovering.</li>
<li>Receding market risk premiums could lend the REIT the necessary latitude to gain value.</li>
<li>Today we turn our attention to <strong>Realty Income Corporation (<span class="ticker-hover-wrapper">NYSE:O</span>)</strong>, a retail-centric Real Estate Investment Trust ("REIT") known to many as the "monthly dividend company."</li>
</ul>


A cyclical pivot within the retail space is likely as consumer sentiment in the U.S. and the United Kingdom has started recovering.
Receding market risk premiums could lend the REIT the necessary latitude to gain value.
Today we turn our attention to Realty Income Corporation (NYSE:O), a retail-centric Real Estate Investment Trust ("REIT") known to many as the "monthly dividend company."


Realty Income: A Potential Inflection Point Has Surfaced (Rating Upgrade)

<ul>
<li>Realty Income Corporation's sustainable growth rate has stalled, resulting in an intrinsic value below its traded market price.</li>
<li>Realty Income's market-based features, including dividend growth and low volatility, are favorable.</li>
<li>However, we think the REITs valuation is a significant risk.</li>
</ul>


Realty Income Corporation's sustainable growth rate has stalled, resulting in an intrinsic value below its traded market price.
Realty Income's market-based features, including dividend growth and low volatility, are favorable.
However, we think the REITs valuation is a significant risk.


Realty Income Corporation: Diminishing Risk-Adjusted Returns

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

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Event-Driven

<p>On Friday post market close, S&amp;P Dow Jones announced the results of the March review for the <a href="https://www.smartkarma.com/entities/s-p-500" target="_blank" data-smartkarma-citation="entities:22886:1" rel="noopener">S&amp;P 500 (SPX INDEX)</a> that will be effective after the close of trading on 19 March.</p><p>There are 4 additions - <a href="https://www.smartkarma.com/entities/nxp-semiconductors-nv" target="_blank" data-smartkarma-citation="entities:9801:1" rel="noopener">Nxp Semiconductors Nv (NXPI US)</a>, <a href="https://www.smartkarma.com/entities/penn-national-gaming-inc" target="_blank" data-smartkarma-citation="entities:5588:1" rel="noopener">Penn National Gaming (PENN US)</a>, <a href="https://www.smartkarma.com/entities/generac-holdings-inc" target="_blank" data-smartkarma-citation="entities:16223:1" rel="noopener">Generac Holdings (GNRC US)</a> and <a href="https://www.smartkarma.com/entities/caesars-entertainment-corp" target="_blank" data-smartkarma-citation="entities:15532:1" rel="noopener">Caesars Entertainment (CZR US)</a>. To balance that out, there are 4 deletions - <a href="https://www.smartkarma.com/entities/flowserve-corp" target="_blank" data-smartkarma-citation="entities:20555:1" rel="noopener">Flowserve Corp (FLS US)</a>, <a href="https://www.smartkarma.com/entities/sl-green-realty-corp" target="_blank" data-smartkarma-citation="entities:1548:1" rel="noopener">Sl Green Realty (SLG US)</a>, <a href="https://www.smartkarma.com/entities/xerox-holdings-corp" target="_blank" data-smartkarma-citation="entities:17585:1" rel="noopener">Xerox Corp (XRX US)</a> and <a href="https://www.smartkarma.com/entities/vontier-corp" target="_blank" data-smartkarma-citation="entities:28857:1" rel="noopener">Vontier Corp (VNT US)</a>.</p><p>We estimate one-way turnover will be around US$22.4bn and the funding trade will see selling on a lot of the current index constituents.</p><p>The biggest impact of the changes will be on <a href="https://www.smartkarma.com/entities/nxp-semiconductors-nv" target="_blank" data-smartkarma-citation="entities:9801:1" rel="noopener">Nxp Semiconductors Nv (NXPI US)</a> where we estimate passive funds will need to buy around 11 days of ADV on the stock. The impact on the other stocks is much lower due to the move between the <a href="https://www.smartkarma.com/entities/s-p-500" target="_blank" data-smartkarma-citation="entities:22886:1" rel="noopener">S&amp;P 500 (SPX INDEX)</a> and the S&amp;P Mid Cap 400 indices.</p>

On Friday post market close, S&amp;P Dow Jones announced the results of the March review for the S&amp;P 500 (SPX INDEX) that will be effective after the close of trading on 19 March.There are 4 additions - Nxp Semiconductors Nv (NXPI US), Penn National Gaming (PENN US), Generac Holdings (GNRC US) and Caesars Entertainment (CZR US). To balance that out, there are 4 deletions - Flowserve Corp (FLS US), Sl Green Realty (SLG US), Xerox Corp (XRX US) and Vontier Corp (VNT US).We estimate one-way turnover will be around US$22.4bn and the funding trade will see selling on a lot of the current index constituents.The biggest impact of the changes will be on Nxp Semiconductors Nv (NXPI US) where we estimate passive funds will need to buy around 11 days of ADV on the stock. The impact on the other stocks is much lower due to the move between the S&amp;P 500 (SPX INDEX) and the S&amp;P Mid Cap 400 indices.

S&P500 Index Rebalance: NXPI Is the One to Watch

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

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.

Equity Capital Markets

United Hampshire US REIT / Equity Capital Markets

<div><p>United Hampshire US REIT (UHUS) raised around US$324m in its Singapore IPO. UHUS will invest in  grocery-anchored and necessity-based retail properties, and self-storage facilities, located in the U.S. </p></div><div><p>The initial portfolio consists of 22 assets with an aggregate net lettable area (NLA) of 3.17m sqft on the East Coast of the U.S. The portfolio comprises 18 grocery &amp; necessity properties with a total NLA of 2.86m sq ft and four self-storage properties with a total NLA of 0.31m sq ft. The aggregate purchase consideration payable is US$582.5m.</p></div><div>
<p>In my previous notes I looked at:</p>
<ul><li>The company’s past performance and highlighted some of the issues, <a href="https://www.smartkarma.com/insights/united-hampshire-us-reit-ipo-e-commerce-resistant-maybe-but-still-not-doing-great" target="_blank" rel="noopener">United Hampshire US REIT IPO - E-Commerce Resistant Maybe but Still Not Doing Great</a>, </li></ul>
</div><div>
<ul><li>Talked about valuations and ran the deal through our ECM framework, <a href="https://www.smartkarma.com/insights/united-hampshire-us-reit-ipo-yield-looks-enticing-but-falls-short-on-multiple-measures" target="_blank" rel="noopener">United Hampshire US REIT IPO - Yield Looks Enticing but Falls Short on Multiple Measures</a>
</li></ul>
<p>In this insight, I'll re-visit some of the deal dynamics and provide a table with implied valuations at different share prices.</p>
</div>

United Hampshire US REIT (UHUS) raised around US$324m in its Singapore IPO. UHUS will invest in  grocery-anchored and necessity-based retail properties, and self-storage facilities, located in the U.S. The initial portfolio consists of 22 assets with an aggregate net lettable area (NLA) of 3.17m sqft on the East Coast of the U.S. The portfolio comprises 18 grocery &amp; necessity properties with a total NLA of 2.86m sq ft and four self-storage properties with a total NLA of 0.31m sq ft. The aggregate purchase consideration payable is US$582.5m.
In my previous notes I looked at:
The company’s past performance and highlighted some of the issues, United Hampshire US REIT IPO - E-Commerce Resistant Maybe but Still Not Doing Great, 

Talked about valuations and ran the deal through our ECM framework, United Hampshire US REIT IPO - Yield Looks Enticing but Falls Short on Multiple Measures

In this insight, I'll re-visit some of the deal dynamics and provide a table with implied valuations at different share prices.


United Hampshire US REIT IPO Trading - Peers Have Corrected by 5-13%

United States

Realty Income Corporation owns and manages a portfolio of commercial properties located across the United States. The Company focuses on acquiring single-tenant retail locations, leased to regional and national chains, and under long-term net lease agreements.

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Realty Income (O US)

Rough Road Ahead for US Commercial Real Estate but Industrial CRE Is Rooted to Outperform Others

US CRE shows bleak prospects for 2024 due to structural demand decline for office space. CRE loan delinquency on the rise for five sequential...

Mint Finance

Realty Income: A Potential Inflection Point Has Surfaced (Rating Upgrade)

A cyclical pivot within the retail space is likely as consumer sentiment in the U.S. and the United Kingdom has started recovering.

Pearl Gray Equity and Research

Realty Income Corporation: Diminishing Risk-Adjusted Returns

Realty Income Corporation's sustainable growth rate has stalled, resulting in an intrinsic value below its traded market price.

Pearl Gray Equity and Research

S&P500 Index Rebalance: NXPI Is the One to Watch

There are 4 changes to the S&P500 with NXP Semiconductors the largest beneficiary of the changes. Estimated one-way turnover is US$22.4bn and there...

Brian Freitas

United Hampshire US REIT IPO Trading - Peers Have Corrected by 5-13%

United Hampshire US REIT (UHUS) raised around US$324m in its Singapore IPO. UHUS will invest in grocery-anchored and necessity-based retail...

Sumeet Singh

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