Financials & FinTech research, Galliano’s Financials Research

Victor Galliano

Financials & FinTech research

Financials & FinTech, EM & Developed Markets

Galliano’s Financials Research

Galliano's Financials Research provides fundamental research in Emerging Markets financials, including FinTech, as well as financials in select Developed Markets.

The investment style applied is generally value oriented, although Growth At Reasonable Price (GARP) strategies can also be used where appropriate. 

Our investment research approach aim is often contrarian, looking to capitalise on overly sceptical or optimistic consensus views. In terms of valuation techniques, the focus is on PBV ratio to ROE, PE multiples and dividend yield, as well as the application of PEG ratios and, where appropriate, Sum of the Parts (SOTP) valuations.

Event-Driven

<ul>
<li>The SoftBank NAV discount is historically high, which makes it appear optically attractive; despite this, we turn neutral on SoftBank group from our previous positive recommendation, due to its headwinds</li>
<li>JPY strength is a key challenge, especially since the new Japanese prime minister supports the BoJ normalising monetary policy; this means BoJ tightening whilst many other central banks are easing</li>
<li>Arm Holdings’ super premium valuation versus its peers is another potential headwind for SoftBank group shares and NAV, combined with the high correlation between Arm Holdings and SoftBank group shares</li>
</ul>


The SoftBank NAV discount is historically high, which makes it appear optically attractive; despite this, we turn neutral on SoftBank group from our previous positive recommendation, due to its headwinds
JPY strength is a key challenge, especially since the new Japanese prime minister supports the BoJ normalising monetary policy; this means BoJ tightening whilst many other central banks are easing
Arm Holdings’ super premium valuation versus its peers is another potential headwind for SoftBank group shares and NAV, combined with the high correlation between Arm Holdings and SoftBank group shares


Softbank (9984 JP) - Despite the High NAV Discount, We See Greater Headwinds; Downgrading to Neutral

Investment Research - Asia Consumer Sector, Investory

Devi Subhakesan

Investment Research - Asia Consumer Sector

ASIA CONSUMER: INSIGHTS AND INVESTMENT IDEAS

Investory

Investory is a Singapore-based boutique independent equity research firm founded in January 2017 with a primary focus on consumption themes across Asia-Pacific.

We aim to generate investible ideas based on consumption trends and outlook. We screen our ideas on several parameters - product potential, long-term growth and management commitment being the most critical.  We follow a fundamental analysis approach in our stock selection process and are not restricted by market cap.

We aspire to grow into a leading source of unbiased research, free of conflict of interest, for investors yearning for independent and disciplined analysis. 

We also undertake bespoke research mandates to support our Institutional clients’ investment needs.

Our team comprises of professionals with extensive experience in the Asian equity markets, in areas ranging from research, servicing institutional clients and investment management.

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/softbank-group-corp" target="_blank" data-smartkarma-citation="entities:315:1" rel="noopener">Softbank Group (9984 JP)</a>  could see its USD450 million investment in India food delivery player, <a href="https://www.smartkarma.com/entities/bundl-technologies-private-limited-swiggy" target="_blank" data-smartkarma-citation="entities:35630:1" rel="noopener">Swiggy </a>, triple in value with the upcoming IPO, reportedly valuing it at USD15 bn.</li>
<li>SoftBank Group, generated a total return, net of investments, of USD1.4 billion with the listing of <a href="https://www.smartkarma.com/entities/ola-electric-mobility-pvt-ltd" target="_blank" data-smartkarma-citation="entities:40618:1" rel="noopener">Ola Electric (OLAELEC IN)</a> , Unicommerce (UNIECOM IN), and <a href="https://www.smartkarma.com/entities/brainbees-solutions" target="_blank" data-smartkarma-citation="entities:36115:1" rel="noopener">BrainBees Solutions</a>, this month. </li>
<li>If Swiggy's IPO reaches valuations closer to Zomato's, SoftBank could reap even greater rewards than from its recent portfolio company listings.</li>
</ul>



Softbank Group (9984 JP)  could see its USD450 million investment in India food delivery player, Swiggy , triple in value with the upcoming IPO, reportedly valuing it at USD15 bn.
SoftBank Group, generated a total return, net of investments, of USD1.4 billion with the listing of Ola Electric (OLAELEC IN) , Unicommerce (UNIECOM IN), and BrainBees Solutions, this month. 
If Swiggy's IPO reaches valuations closer to Zomato's, SoftBank could reap even greater rewards than from its recent portfolio company listings.


SoftBank Group (9984 JP): A Bigger Bounty Awaits with Swiggy's Upcoming IPO

<ul>
<li>The announcement of JPY500bn share buybacks is a positive for SoftBank group minority shareholders, and confirms the positive impact of the emergence of Elliott as an activist shareholder</li>
<li>The combination of the big weighting of Arm Holdings in the group’s equity value and the impact of the appreciating JPY has driven the NAV discount to very high levels</li>
<li>Much bad news seems priced in following the market turbulence; we remain positive on Softbank shares as they trade at a historically high 57%+ discount to the estimated NAV</li>
</ul>


The announcement of JPY500bn share buybacks is a positive for SoftBank group minority shareholders, and confirms the positive impact of the emergence of Elliott as an activist shareholder
The combination of the big weighting of Arm Holdings in the group’s equity value and the impact of the appreciating JPY has driven the NAV discount to very high levels
Much bad news seems priced in following the market turbulence; we remain positive on Softbank shares as they trade at a historically high 57%+ discount to the estimated NAV


Softbank (9984 JP): The NAV Discount High Offers an Investment Opportunity

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

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

<ul>
<li>There are 44 adds/41 deletes for the JPX Nikkei 400 Index to bring the number of index constituents back to 400. There are stocks with multiple days ADV to trade.</li>
<li>Based on the adds, deletes and capping changes, we estimate one way turnover of 7.9% and a round-trip trade of JPY 880bn (US$6bn).</li>
<li>The adds have outperformed the deletes over the last year though that has been faded over the last couple of months. Breaking with history, there could be outperformance near-term.</li>
</ul>


There are 44 adds/41 deletes for the JPX Nikkei 400 Index to bring the number of index constituents back to 400. There are stocks with multiple days ADV to trade.
Based on the adds, deletes and capping changes, we estimate one way turnover of 7.9% and a round-trip trade of JPY 880bn (US$6bn).
The adds have outperformed the deletes over the last year though that has been faded over the last couple of months. Breaking with history, there could be outperformance near-term.


JPX Nikkei 400 Index Rebalance: A Bunch of Chunky Adds & US$6bn Trade

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

<ul>
<li>Aequitas Research's weekly update on the IPOs, placements, lockup expiry and other ECM linked events that were covered by the team over the past week.</li>
<li>On the IPOs front, Indian deals continue to flow in, even as other markets have taken a breather ahead of US elections this week.</li>
<li>On the placements front, there weren't many large deals but we did look at a number of upcoming lockup expiries.</li>
</ul>


Aequitas Research's weekly update on the IPOs, placements, lockup expiry and other ECM linked events that were covered by the team over the past week.
On the IPOs front, Indian deals continue to flow in, even as other markets have taken a breather ahead of US elections this week.
On the placements front, there weren't many large deals but we did look at a number of upcoming lockup expiries.


ECM Weekly (4th Nov 2024) - Swiggy, Waaree, Afcons, TS Lines, Zeekr, Hyundai Marine, Indegene, TBO

Japan

SoftBank Group Corp provides telecommunication services.  The Company also operates ADSL (Asymmetric Digital Subscriber Line) and fiber optic high-speed Internet connection, e-Commerce businesses, and Internet based advertising and auction businesses.

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Softbank Group (ADR) (SFTBY US)

Softbank (9984 JP) - Despite the High NAV Discount, We See Greater Headwinds; Downgrading to Neutral

SoftBank's high NAV discount may seem optically attractive, but headwinds have increased; JPY strength is on the rise and Arm Holdings' premium...

Victor Galliano

SoftBank Group (9984 JP): A Bigger Bounty Awaits with Swiggy's Upcoming IPO

Softbank-backed India-based food and grocery delivery firm Swiggy filed draft red herring prospectus with the markets regulator, SEBI and aims to...

Devi Subhakesan

Softbank (9984 JP): The NAV Discount High Offers an Investment Opportunity

The combination of the big weighting of Arm Holdings in the SoftBank group’s equity value and the appreciation of JPY in the market turbulence is...

Victor Galliano

JPX Nikkei 400 Index Rebalance: A Bunch of Chunky Adds & US$6bn Trade

There are 44 adds/41 deletes for the JPX Nikkei 400 Index resulting in a one-way turnover of 7.9% and a round-trip trade of JPY 880bn (US$6bn)....

Brian Freitas

ECM Weekly (4th Nov 2024) - Swiggy, Waaree, Afcons, TS Lines, Zeekr, Hyundai Marine, Indegene, TBO

Aequitas Research's weekly update on the IPOs, placements, lockup expiry and other ECM linked events that were covered by the team over the past week.

Sumeet Singh

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Softbank (9984 JP) - Despite the High NAV Discount, We See Greater Headwinds; Downgrading to Neutral

​SoftBank's high NAV discount may seem optically attractive, but headwinds have increased; JPY strength is on the rise and Arm Holdings' premium...

Victor Galliano

SoftBank Group (9984 JP): A Bigger Bounty Awaits with Swiggy's Upcoming IPO

Softbank-backed India-based food and grocery delivery firm Swiggy filed draft red herring prospectus with the markets regulator, SEBI and aims to...

Devi Subhakesan

Softbank (9984 JP): The NAV Discount High Offers an Investment Opportunity

The combination of the big weighting of Arm Holdings in the SoftBank group’s equity value and the appreciation of JPY in the market turbulence is...

Victor Galliano

JPX Nikkei 400 Index Rebalance: A Bunch of Chunky Adds & US$6bn Trade

There are 44 adds/41 deletes for the JPX Nikkei 400 Index resulting in a one-way turnover of 7.9% and a round-trip trade of JPY 880bn (US$6bn)....

Brian Freitas

ECM Weekly (4th Nov 2024) - Swiggy, Waaree, Afcons, TS Lines, Zeekr, Hyundai Marine, Indegene, TBO

Aequitas Research's weekly update on the IPOs, placements, lockup expiry and other ECM linked events that were covered by the team over the past week.

Sumeet Singh

SoftBank's high NAV discount may seem optically attractive, but headwinds have increased; JPY strength is on the rise and Arm Holdings' premium...