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Smartkarma Daily Briefs

May 15
0

Daily Brief Macro: Great Game – Why Putin fired Shoigu and Why Biden is going tough on China and more

By | Daily Briefs, Macro

In today’s briefing:

  • Great Game – Why Putin fired Shoigu and Why Biden is going tough on China
  • NFIB Watch: 5 KEY charts from the best survey on the US economy
  • CX Daily: Will China’s Latest Policy Call-to-arms Turn The Ailing Property Market Around?
  • Out of the Box: Don’t worry about the real rates spread, ECB
  • UK: Excessive Pay Problem Persists

Great Game – Why Putin fired Shoigu and Why Biden is going tough on China

By Mikkel Rosenvold

  • Welcome to this week’s geopolitical update, the Great Game.
  • This week we’re covering Putin’s surprise sacking of Defense Minister Shoigu as well as the ongoing global EV war.
  • Russian President Putin has replaced his Defense Minister Sergei Shoigu with former economic advisor and Deputy Prime Minister Andrei Beluosov.

NFIB Watch: 5 KEY charts from the best survey on the US economy

By Andreas Steno

  • Our favorite survey out of the US economy was published earlier and it was a pretty decent report overall as the sentiment among SMEs improved, but there are a few trends worth noting in the details, so why don’t we briefly walk you through them here.
  • For the first time in a long while, we see a clear net/net decrease in expectations for future price hikes.
  • This is conciliatory news for Jay Powell and his ilk for H2-2024 (but not before then..)

CX Daily: Will China’s Latest Policy Call-to-arms Turn The Ailing Property Market Around?

By Caixin Global

  • Property / Cover Story: Will China’s latest policy call-to-arms turn the ailing property market around?

  • Corruption /Exclusive: Two ChemChina ex-leaders during Syngenta deal hit with corruption probe

  • Audit /Accounting: firms in China required to store audit data on mainland under new rules

Out of the Box: Don’t worry about the real rates spread, ECB

By Ulrik Simmelholt

  • Even though manufacturing data and headline HICP year on year in the Euro Area are screaming for easier financial conditions, the ECB seems reluctant (or at least slow) to cut rates and rather prefer just to be the lagged Fed.
  • If it is fear of wider real rates spread towards other currencies, especially the USD, then we argue that Lagarde & co don’t need to worry.
  • Firstly, because we find arguments from the past 10 years that EUR/USD can go higher even in an environment in which USD – EUR real rates spread widen and that real rates is not the only macro factor in determining the EUR/USD path.

UK: Excessive Pay Problem Persists

By Phil Rush

  • UK unemployment increased again to 4.3% in March, as expected. The Q1 deterioration still looks spurious, like the preceding strength, but the extent of change is slowing.
  • Vacancies are falling, but so are redundancies. Incumbent workers enjoy high pay increases despite reduced demand for new workers amid broadly high expectations.
  • Average earnings surged beyond expectations again. The absence of progress in pay settlements prevents slowing to a target-consistent pace, but the BoE seems unfazed.

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May 15
0

Most Read: Toppan Printing, Tencent, Shinva Medical Instrument A, Modec Inc, SK IE Technology , Ushio Inc, Square Enix Holdings, Great Eastern Holdings and more

By | Daily Briefs, Most Read

In today’s briefing:

  • Toppan Printing (7911) Accelerates Buyback Pace and Amount; But Crossholder Sales Lurk
  • Tencent Q1 FY24 Results Due, a Look into What Is Priced
  • CSI Medical Service Index Rebalance Preview: Repeat of the December Rebal Could See Big Gains
  • YUUUGE Modec (6269) Offering To Stay Listed in TSE Prime – Effectively a Re-IPO
  • Key Timing Window for a Surge in Block Deals Before Pre-Disclosure Takes Effect in July
  • Another HUGE Ushio (6925) Buyback After A HUGE Buyback Last Year
  • MODEC (6296 JP): A US$535 Million Secondary Offering
  • Japan – Another Big Round of Passive Selling
  • Modec Placement – Deal Seems a Little Opportunistic but Not Particularly Expensive
  • Great Eastern (GE SP): Getting Technical

Toppan Printing (7911) Accelerates Buyback Pace and Amount; But Crossholder Sales Lurk

By Travis Lundy

  • Toppan Printing (7911 JP) established a new Medium-Term Management Plan with targets in May 2023. 8% ROE, PBR >1.0x. More DX business. More management modernisation. More ESG. Mooooarrrrr!
  • They also promised capital measures: ¥100bn of buybacks over three years. Total shareholder return of 50%+ over three years. More progress in selling down cross-holdings. 
  • Today the company reported better-than expected full-year revenues, OP, and Net Profit, added more to the buybacks, and shortened the buyback period to two years. Details matter.

Tencent Q1 FY24 Results Due, a Look into What Is Priced

By Charlotte van Tiddens, CFA

  • Tencent is due to release Q1 FY24 results today. The earnings call is scheduled for 14:00 SAST
  • In this note, we unpack what is priced and how Tencent has performed relative to constituents in the HSTECH index since our last update (29 April).
  • We also provide an update on how the discounts of Naspers and Prosus have traded.

CSI Medical Service Index Rebalance Preview: Repeat of the December Rebal Could See Big Gains

By Brian Freitas

  • The review period ended on 30 April, there are just over 2 weeks to announcement of the changes, and implementation will be done at the close on 14 June.
  • We forecast 5 potential changes for the index in June where there could be buying of 1.6-2.6x ADV on the adds and selling of 0.7-2.6x ADV on the deletes.
  • At the December 2023 rebalance, the adds outperformed the deletes in the weeks prior to announcement of the changes and then spiked post-announcement. Repeat this time?

YUUUGE Modec (6269) Offering To Stay Listed in TSE Prime – Effectively a Re-IPO

By Travis Lundy

  • In March, Modec Inc (6269 JP) announced the TSE had said Modec at 29.3% (end-Dec-23) was below the required 35% tradable shares level required for continued listing on TSE Prime. 
  • It announced a “Basic Plan” to comply with the criteria which involved convincing one of the three major corporate holders to sell some. They needed to sell about 6%.
  • Mitsui E&S has announced it will sell 32%, and 37% including greenshoe. This is overdoing it in a huge way. Mitsui E&S is getting out. This is a re-IPO.

Key Timing Window for a Surge in Block Deals Before Pre-Disclosure Takes Effect in July

By Sanghyun Park

  • Anticipation grows for increased block deals before July 24th’s pre-announcement rule takes effect, emerging as a key investment focus in the local market.
  • The local market expects heightened activity in the three weeks post-May 15th, following first-quarter earnings announcements, a strategic move to mitigate insider trading controversies.
  • Local traders eagerly await which companies will capitalize on the post-first-quarter earnings window, with a highly anticipated block deal involving SK Innovation selling a portion of its stake in SKIET.

Another HUGE Ushio (6925) Buyback After A HUGE Buyback Last Year

By Travis Lundy

  • Last year with earnings, Ushio Inc (6925 JP) announced a HUUUGE buyback discussed in  HUUUGE Ushio (6925) Buyback. The headline was 17% of shares out. They ended up buying 13.2%. 
  • Last year the stock popped on the news. Then shares went sideways for months. Then they went up on stable (bad) earnings guidance in H2. Today they beat Q3-updated guidance.
  • But today they announced a “new growth strategy” to 2030, and guided to a SHARP (-60%) drop in OP and NP to March 2025, and announced a HUUUGE Buyback. Again.

MODEC (6296 JP): A US$535 Million Secondary Offering

By Arun George

  • Modec Inc (6269 JP) has announced a secondary offering of up to 25.2 million shares (including overallotment). The largest shareholder, Mitsui E&S Holdings (7003 JP), is the seller.
  • MODEC’s goal with the secondary offering is to reconfigure its shareholder mix to have a diverse base of shareholders who support its long-term strategies and a better tradable share ratio.
  • Looking at recent large Japanese placements is instructive for understanding the potential offer price. The pricing date will likely fall between 22 and 28 May (likely 22 May).

Japan – Another Big Round of Passive Selling

By Brian Freitas

  • There are 15 stocks in Japan that will be sold by passive trackers at the close on 31 May.
  • Short interest has been increasing in these stocks over the last few months and there will be covering on implementation date.
  • Cumulative excess volume on all stocks has risen in the last couple of months though the pace of the increase has varied.

Modec Placement – Deal Seems a Little Opportunistic but Not Particularly Expensive

By Ethan Aw

  • Mitsui E&S Holdings (7003 JP) is looking to raise approximately US$451m through a secondary follow-on offering, via selling approximately 21.9m shares (32% of TSO) of Modec Inc (6269 JP)’s stock. 
  • The deal is a large one to digest at 81 days of three month ADV. 
  • In this note, we will talk about the placement and run the deal through our ECM framework.

Great Eastern (GE SP): Getting Technical

By David Blennerhassett

  • Great Eastern Holdings (GE SP) has consistently traded through OCBC (OCBC SP)‘s Offer terms from the onset. 
  • OCBC did not declare its S$25.60 cash Offer final. And someone appears to be accumulating a stake to block an Exit/Delisting Offer, presumably towards negotiating a bump in terms.
  • But what happens if GE’s free float falls <10% at the close of the Offer and GE is suspended? And OCBC has no intention of restoring the float?

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May 15
0

Daily Brief Utilities: Talen Energy and more

By | Daily Briefs, Utilities Sector

In today’s briefing:

  • TLNE: Spark of Value

TLNE: Spark of Value

By Hamed Khorsand

  • TLNE reported Q1 results benefiting from its hedging program to offset the warmer winter in parts of the country. The Q1 results confirmed the commentary management had previously provided
  • TLNE sold its power plants in Texas subsequent to the first quarter ending. This should remove a large portion of volatility from TLNE’s operations
  • Spark spreads have continued to move in TLNE’s favor implying quarterly results this year could remain above expectations

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May 15
0

Daily Brief Industrials: Ushio Inc, Grab Holdings , Atlas Arteria, Sodick Co Ltd, CoreCivic and more

By | Daily Briefs, Industrials

In today’s briefing:

  • Another HUGE Ushio (6925) Buyback After A HUGE Buyback Last Year
  • Grab Holdings (GRAB US) – Rich in Initiatives
  • Atlas Arteria (ALX AU): IFM Ups Stake As Shares Waver
  • Sodick (6143 JP) – Incremental Progress Is Being Made
  • CXW: 1Q24 Beat Highlights Operating Leverage, Improving Occupancies

Another HUGE Ushio (6925) Buyback After A HUGE Buyback Last Year

By Travis Lundy

  • Last year with earnings, Ushio Inc (6925 JP) announced a HUUUGE buyback discussed in  HUUUGE Ushio (6925) Buyback. The headline was 17% of shares out. They ended up buying 13.2%. 
  • Last year the stock popped on the news. Then shares went sideways for months. Then they went up on stable (bad) earnings guidance in H2. Today they beat Q3-updated guidance.
  • But today they announced a “new growth strategy” to 2030, and guided to a SHARP (-60%) drop in OP and NP to March 2025, and announced a HUUUGE Buyback. Again.

Grab Holdings (GRAB US) – Rich in Initiatives

By Angus Mackintosh

  • Grab‘s focus last year was offering more affordable products, which helped to increase its addressable market. FY2024 will see the rollout of a broader range of initiatives across economic segments. 
  • This year Grab is rolling out more premium offerings and new initiatives, including advance bookings, family accounts, increased reviews, and new merchant features to grow revenue streams from advertising.
  • The upcoming results are likely to reflect seasonal factors but should also reveal something about Grab’s new initiatives and the changing competitive environment, with GoTo investing more aggressively. 

Atlas Arteria (ALX AU): IFM Ups Stake As Shares Waver

By David Blennerhassett

  • Back in June 2022, US/Europe toll-road play Atlas Arteria (ALX AU) (ATLIX) rejected IFM Global Infrastructure’s request for limited company information, before deciding whether to submit a non-binding indicative proposal. 
  • Undeterred, IFM, which held 15% of shares out at the time, bumped its stake to 19% two months later; and has continued to capitalise on Australia’s creep provisions ever since. 
  • This morning, IFM is understood to have lifted its stake to ~26.5%, in an apparent attempt to gain additional board representation. Another tilt cannot be ruled out. 

Sodick (6143 JP) – Incremental Progress Is Being Made

By Astris Advisory Japan

  • An uplift in China orders – Q1 FY12/24 results saw a continued decline in sales by 7.4% YoY and 9.3% QoQ.
  • However, the core Machine Tools segment saw flat sales QoQ, and order visibility improved with China orders rising by 39.4% QoQ albeit from a low base.
  • Cost reduction efforts have commenced and are set to accelerate into Q2 FY12/24 which should improve the scope for profitability, although ultimately this will be sales volume dependent. 

CXW: 1Q24 Beat Highlights Operating Leverage, Improving Occupancies

By Zacks Small Cap Research

  • Management has indicated that the pipeline for new leases, renewals is robust as ICE & multiple government entities seek capacity.
  • Company is engaged in multiple discussions.
  • In addition, the recent debt issuance extended maturities & CXW was able to maintain the cost of capital despite the uncertain rate, economic outlook.

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May 15
0

Daily Brief Energy/Materials: Modec Inc, SK IE Technology , Xinyi Solar Holdings, Nexgen Energy, Pan American Silver, Valvoline , Geopark Ltd and more

By | Daily Briefs, Energy & Materials Sector

In today’s briefing:

  • YUUUGE Modec (6269) Offering To Stay Listed in TSE Prime – Effectively a Re-IPO
  • Key Timing Window for a Surge in Block Deals Before Pre-Disclosure Takes Effect in July
  • MODEC (6296 JP): A US$535 Million Secondary Offering
  • Modec Placement – Deal Seems a Little Opportunistic but Not Particularly Expensive
  • Quiddity HSCEI Jun 24 Final Expectations: 2 Changes Likely; US$496mn One-Way Flow
  • What were NexGen thinking?
  • Pan American Silver – A taste of things to come
  • Pershing Square Challenge 2024 winning team shares pitch on Valvoline $VVV
  • GeoPark Limited (NYSE: GPRK): Entering the Vaca Muerta

YUUUGE Modec (6269) Offering To Stay Listed in TSE Prime – Effectively a Re-IPO

By Travis Lundy

  • In March, Modec Inc (6269 JP) announced the TSE had said Modec at 29.3% (end-Dec-23) was below the required 35% tradable shares level required for continued listing on TSE Prime. 
  • It announced a “Basic Plan” to comply with the criteria which involved convincing one of the three major corporate holders to sell some. They needed to sell about 6%.
  • Mitsui E&S has announced it will sell 32%, and 37% including greenshoe. This is overdoing it in a huge way. Mitsui E&S is getting out. This is a re-IPO.

Key Timing Window for a Surge in Block Deals Before Pre-Disclosure Takes Effect in July

By Sanghyun Park

  • Anticipation grows for increased block deals before July 24th’s pre-announcement rule takes effect, emerging as a key investment focus in the local market.
  • The local market expects heightened activity in the three weeks post-May 15th, following first-quarter earnings announcements, a strategic move to mitigate insider trading controversies.
  • Local traders eagerly await which companies will capitalize on the post-first-quarter earnings window, with a highly anticipated block deal involving SK Innovation selling a portion of its stake in SKIET.

MODEC (6296 JP): A US$535 Million Secondary Offering

By Arun George

  • Modec Inc (6269 JP) has announced a secondary offering of up to 25.2 million shares (including overallotment). The largest shareholder, Mitsui E&S Holdings (7003 JP), is the seller.
  • MODEC’s goal with the secondary offering is to reconfigure its shareholder mix to have a diverse base of shareholders who support its long-term strategies and a better tradable share ratio.
  • Looking at recent large Japanese placements is instructive for understanding the potential offer price. The pricing date will likely fall between 22 and 28 May (likely 22 May).

Modec Placement – Deal Seems a Little Opportunistic but Not Particularly Expensive

By Ethan Aw

  • Mitsui E&S Holdings (7003 JP) is looking to raise approximately US$451m through a secondary follow-on offering, via selling approximately 21.9m shares (32% of TSO) of Modec Inc (6269 JP)’s stock. 
  • The deal is a large one to digest at 81 days of three month ADV. 
  • In this note, we will talk about the placement and run the deal through our ECM framework.

Quiddity HSCEI Jun 24 Final Expectations: 2 Changes Likely; US$496mn One-Way Flow

By Janaghan Jeyakumar, CFA

  • The HSCEI serves as a benchmark to reflect the overall performance of the top 50 “Mainland China” securities listed in Hong Kong.
  • The index changes and indicative weights for the June 2024 index rebal event will be announced after market close on Friday 17th May 2024.
  • In this insight, we take a look at the potential index changes and our latest flow expectations.

What were NexGen thinking?

By Money of Mine

  • Red Pine exploration withdrew previously announced assays for Wawa gold project due to inconsistencies in results
  • CEO manipulated assay results, leading to inaccurate data being used for internal mineral resource estimates
  • Geological expert Renee Sterk discusses the shady practices in the industry and the consequences of such actions

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

Pan American Silver – A taste of things to come

By Edison Investment Research

Pan American Silver (PAAS) has seen an encouraging start to the year with Q124 silver and gold production in line with management expectations and costs for both segments below its quarterly guidance. Q1 is typically one of the slowest quarters for PAAS and the company’s maintained guidance points to significant improvements in production and costs in H224. This should be supported by the current strength in commodity prices. We have increased our FY24 EBITDA estimate by 25% and upgraded our valuation from US$22.2/share to US$23.4. We believe there could be further upside to the share price if commodity prices remain at elevated levels and the company delivers on its operational guidance in FY24.

Pershing Square Challenge 2024 winning team shares pitch on Valvoline $VVV

By Yet Another Value Podcast

  • Valvoline is a vehicle service center focused on quick lube and basic maintenance services.
  • They have a new focus as a pure play company after divesting their global products business in 2023.
  • The team pitched Valvoline with a price target of $84, representing a 95% price upside and 22% IRR.

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

GeoPark Limited (NYSE: GPRK): Entering the Vaca Muerta

By Auctus Advisors

  • GeoPark is acquiring 49.5 mmboe 2P reserves (>90% light oil), 118 mmboe 3C contingent resources and ~5 mmboe unconventional production across four blocks in the oil window of the Vaca Muerta in Argentina from a subsidiary of Mercuria.
  • The Vaca Muerta in Argentina is a hot spot for unconventional development and a strategic area for most supermajors and YPF.
  • The formation is estimated to hold 16 bn bbl of oil and 300 tcf of natural gas and produces >350 mbbl/d (x4 since 2019).

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May 15
0

Daily Brief TMT/Internet: Tencent, Square Enix Holdings, Intel Corp, Tokyo Electric Power Co, Hon Hai Precision Industry and more

By | Daily Briefs, TMT/Internet

In today’s briefing:

  • Tencent Q1 FY24 Results Due, a Look into What Is Priced
  • Tencent (700 HK): Q1 FY24 Results Quick Take, Margin Expansion Drives Decent Set of Results
  • Japan – Another Big Round of Passive Selling
  • Tencent (700 HK): 1Q24, Highest Margin in Seven Years
  • Intel’s Foundry Chief Runs For The Hills
  • Tencent: Online Advertising and High-Margin Businesses Support Earnings
  • Tech Supply Chain Tracker (15-May-2024): Taiwan announces IC Taiwan Grand Challenge Competition.
  • Hon Hai: Traditional Server Market Now Adding to AI Growth; Expects Market Share Gains in 2024E

Tencent Q1 FY24 Results Due, a Look into What Is Priced

By Charlotte van Tiddens, CFA

  • Tencent is due to release Q1 FY24 results today. The earnings call is scheduled for 14:00 SAST
  • In this note, we unpack what is priced and how Tencent has performed relative to constituents in the HSTECH index since our last update (29 April).
  • We also provide an update on how the discounts of Naspers and Prosus have traded.

Tencent (700 HK): Q1 FY24 Results Quick Take, Margin Expansion Drives Decent Set of Results

By Charlotte van Tiddens, CFA

  • Tencent reported a decent set of results for Q1 FY24. Revenue for the quarter was up 2.8% QoQ and 6.3% YoY, ahead of consensus estimates (2.3% & 5.9%).
  • The gross margin came in at 53%, 3 percentage points ahead of consensus, and an increase of 7 percentage points on Q1 FY23.
  • The gross margin for the Fintech and Business Services segment, which accounts for 33% of revenue, increased by 12 percentage points to 46% (consensus 42.6%).

Japan – Another Big Round of Passive Selling

By Brian Freitas

  • There are 15 stocks in Japan that will be sold by passive trackers at the close on 31 May.
  • Short interest has been increasing in these stocks over the last few months and there will be covering on implementation date.
  • Cumulative excess volume on all stocks has risen in the last couple of months though the pace of the increase has varied.

Tencent (700 HK): 1Q24, Highest Margin in Seven Years

By Ming Lu

  • The operating margin in 1Q24 reached the highest since 2Q16, as the gross margins of all businesses improved.
  • The growth rate of online advertising is high than our estimate, but the growth rate of FinTech is lower than our estimate.
  • We believe there is still an upside of 9% and the price target will be HK$415 for the end of 2024.

Intel’s Foundry Chief Runs For The Hills

By William Keating

  • In a surprise move, Intel announced that its foundry chief Stuart Pann is to retire from the company effective end of May after just over one year in the role
  • He will be replaced by former IBM, Globalfoundries and Marvell executive Kevin O’Buckley, effective immediately
  • Mr. O’Buckley now has the dubious distinction of being the third leader of IFS in as many years. 

Tencent: Online Advertising and High-Margin Businesses Support Earnings

By Shifara Samsudeen, ACMA, CGMA

  • Tencent (700 HK) reported 1Q2024 results today. Both revenues and OP grew 6.3% and 30.0% YoY respectively and beat consensus estimates.
  • Though domestic games revenues declined YoY, there were signs of recovery in Tencent’s gaming business. Online advertising saw strong growth despite 1Q being a seasonally weak quarter for Tencent.
  • Tencent’s investments in high-margin products have helped boost the company’s margins across all business segments.

Tech Supply Chain Tracker (15-May-2024): Taiwan announces IC Taiwan Grand Challenge Competition.

By Tech Supply Chain Tracker

  • Taiwan launches IC Taiwan Grand Challenge to attract innovative teams and talent, offering opportunities to showcase skills and win prizes.
  • Navigating AI investments during upgrades: on-premise or cloud computing? Make informed choices for hardware and software advancements.
  • Taiwan’s LEO satellite program readiness questioned; virtual power plants used in Taiwan and Japan to mitigate earthquake risks; TPCA partners with Taiwanese industry association to boost talent and supply chains for Thai electronics manufacturing growth; Intel appoints new head of foundry services.

Hon Hai: Traditional Server Market Now Adding to AI Growth; Expects Market Share Gains in 2024E

By Vincent Fernando, CFA

  • Hon Hai reported 1Q24 revenue that fell 9% YoY, however the company reiterated its guidance for significant growth in 2024E and said growth now looks stronger than guided in March.
  • Hon Hai’s cloud (including servers) business didn’t grow as much as guided due to material shortages; but AI server revenue up 200% YoY and significant growth is guided for 2024E.
  • The traditional server market is rebounding, to grow double digits in 2024E. Hon Hai expects to take market share in 2024. Structural Long but near-term gains could be limited.

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May 15
0

Daily Brief Industrials: Ushio Inc, Grab Holdings , Atlas Arteria, Sodick Co Ltd, CoreCivic and more

By | Daily Briefs, Industrials

In today’s briefing:

  • Another HUGE Ushio (6925) Buyback After A HUGE Buyback Last Year
  • Grab Holdings (GRAB US) – Rich in Initiatives
  • Atlas Arteria (ALX AU): IFM Ups Stake As Shares Waver
  • Sodick (6143 JP) – Incremental Progress Is Being Made
  • CXW: 1Q24 Beat Highlights Operating Leverage, Improving Occupancies

Another HUGE Ushio (6925) Buyback After A HUGE Buyback Last Year

By Travis Lundy

  • Last year with earnings, Ushio Inc (6925 JP) announced a HUUUGE buyback discussed in  HUUUGE Ushio (6925) Buyback. The headline was 17% of shares out. They ended up buying 13.2%. 
  • Last year the stock popped on the news. Then shares went sideways for months. Then they went up on stable (bad) earnings guidance in H2. Today they beat Q3-updated guidance.
  • But today they announced a “new growth strategy” to 2030, and guided to a SHARP (-60%) drop in OP and NP to March 2025, and announced a HUUUGE Buyback. Again.

Grab Holdings (GRAB US) – Rich in Initiatives

By Angus Mackintosh

  • Grab‘s focus last year was offering more affordable products, which helped to increase its addressable market. FY2024 will see the rollout of a broader range of initiatives across economic segments. 
  • This year Grab is rolling out more premium offerings and new initiatives, including advance bookings, family accounts, increased reviews, and new merchant features to grow revenue streams from advertising.
  • The upcoming results are likely to reflect seasonal factors but should also reveal something about Grab’s new initiatives and the changing competitive environment, with GoTo investing more aggressively. 

Atlas Arteria (ALX AU): IFM Ups Stake As Shares Waver

By David Blennerhassett

  • Back in June 2022, US/Europe toll-road play Atlas Arteria (ALX AU) (ATLIX) rejected IFM Global Infrastructure’s request for limited company information, before deciding whether to submit a non-binding indicative proposal. 
  • Undeterred, IFM, which held 15% of shares out at the time, bumped its stake to 19% two months later; and has continued to capitalise on Australia’s creep provisions ever since. 
  • This morning, IFM is understood to have lifted its stake to ~26.5%, in an apparent attempt to gain additional board representation. Another tilt cannot be ruled out. 

Sodick (6143 JP) – Incremental Progress Is Being Made

By Astris Advisory Japan

  • An uplift in China orders – Q1 FY12/24 results saw a continued decline in sales by 7.4% YoY and 9.3% QoQ.
  • However, the core Machine Tools segment saw flat sales QoQ, and order visibility improved with China orders rising by 39.4% QoQ albeit from a low base.
  • Cost reduction efforts have commenced and are set to accelerate into Q2 FY12/24 which should improve the scope for profitability, although ultimately this will be sales volume dependent. 

CXW: 1Q24 Beat Highlights Operating Leverage, Improving Occupancies

By Zacks Small Cap Research

  • Management has indicated that the pipeline for new leases, renewals is robust as ICE & multiple government entities seek capacity.
  • Company is engaged in multiple discussions.
  • In addition, the recent debt issuance extended maturities & CXW was able to maintain the cost of capital despite the uncertain rate, economic outlook.

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  • ✓ Personalised Alerts
  • ✓ Custom Watchlists
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May 15
0

Daily Brief Financials: Great Eastern Holdings, Aadhar Housing Finance Ltd, Bajaj Finance Ltd, Belstar Microfinance Ltd, Longfor Properties, JDC Group AG, Pioneer Credit and more

By | Daily Briefs, Financials

In today’s briefing:

  • Great Eastern (GE SP): Getting Technical
  • Aadhar Housing Finance IPO Trading – More Loved by Institutional Investors than Retail
  • Bajaj Finance (BAF): Strengthening Franchise to Sustain Growth Longevity
  • Belstar Microfinance Limited Pre-IPO Tearsheet
  • Morning Views Asia: Lippo Karawaci, Softbank Group
  • JDC Group – Well on track in 2024
  • Pioneer Credit Ltd – Refinancing progress – proposed margin reduction

Great Eastern (GE SP): Getting Technical

By David Blennerhassett

  • Great Eastern Holdings (GE SP) has consistently traded through OCBC (OCBC SP)‘s Offer terms from the onset. 
  • OCBC did not declare its S$25.60 cash Offer final. And someone appears to be accumulating a stake to block an Exit/Delisting Offer, presumably towards negotiating a bump in terms.
  • But what happens if GE’s free float falls <10% at the close of the Offer and GE is suspended? And OCBC has no intention of restoring the float?

Aadhar Housing Finance IPO Trading – More Loved by Institutional Investors than Retail

By Sumeet Singh

  • Aadhar Housing Finance(AHF) raised around US$360m in its India IPO, via selling a mix of primary and secondary shares.
  • AHF is focused on the low income housing segments (ticket size less than INR1.5m) in India. It offers a range of mortgage-related loan products.
  • We have looked at the company’s performance and valuation in our past notes. In this note, we talk about the trading dynamics.

Bajaj Finance (BAF): Strengthening Franchise to Sustain Growth Longevity

By Ankit Agrawal, CFA

  • BAF reported a decent Q4FY24 led by strong AUM growth and robust customer acquisition. Adjusted for the impact of the regulatory ban, Q4FY24 results were in line with the expectation.  
  • The biggest negative surprise in Q4FY24 was the 21bp NIM compression. NIM compressed led by AUM composition shifting incrementally to secured assets. 
  • BAF is optimistic on growth across segments, except Rural B2C where risk metrics are somewhat elevated; however this should normalize, given Rural B2B is doing fine.

Belstar Microfinance Limited Pre-IPO Tearsheet

By Clarence Chu

  • Belstar Microfinance Ltd (3624918Z IN) is looking to raise US$156m in its upcoming India IPO. The bookrunners on the deal are ICICI Securities, Axis Capital, HDFC Bank, SBI Capital Markets.
  • Belstar Microfinance (Belstar) is a non-banking finance company (NBFC) in India with a focus on furnishing micro-enterprise loans.
  • As per the CRISIL report, the firm was the ninth largest NBFC – Micro Finance Institution (NBFC-MFI) in terms of assets under management (AUM) as of Dec 2023.

Morning Views Asia: Lippo Karawaci, Softbank Group

By Leonard Law, CFA

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

JDC Group – Well on track in 2024

By Edison Investment Research

JDC Group (JDC) reported strong Q124 results. Revenue growth accelerated to 21.6% from 10% in FY23, driven by its Advisortech division (+22.6%). In terms of profitability, the EBITDA margin increased to 7.6% from 7.3% in Q123. JDC reiterated its FY24 revenue guidance of €205–220m, 24% y-o-y growth at the midpoint, partly driven by the acquisition of Top Ten Financial Network, which management expects to contribute more than €18m in revenues this year. EBITDA is also expected to increase to a guided range of €14.5–16.0m (FY23: €11.7m). We make no changes to our estimates. Our DCF provides a valuation of €34.0/share.

Pioneer Credit Ltd – Refinancing progress – proposed margin reduction

By Research as a Service (RaaS)

  • Pioneer Credit Limited (ASX:PNC) is one of the leading acquirers and managers of impaired credit in Australia and has gained its status by maintaining positive customer engagement, an unblemished compliance record with ASIC, and strong relationships with Australia’s largest bank and non-bank lenders.
  • PNC purchases debt from numerous Australian vendor partners (18 different vendors in the past 12 months) with long-term partnership purchasing arrangements in place with Commonwealth Bank of Australia (ASX:CBA).
  • Pioneer’s success in purchasing large debt portfolios at attractive IRRs since October highlights the strong position the company occupies in the marketplace, now enhanced by the recent purchases on attractive IRRs.

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May 15
0

Daily Brief Health Care: OUE Ltd, Abbisko Cayman, Lantern Pharma , Newron Pharmaceuticals, Scilex Holding , Soligenix , Syra Health and more

By | Daily Briefs, Healthcare

In today’s briefing:

  • 10 in 10 with OUE Healthcare – Sustainable Expansion across Asia
  • Abbisko Cayman (2256.HK) – The Pipeline Lacks Investment Value, Leading to Valuation Collapse
  • LTRN: Expanding Horizons into Asia
  • Newron Pharmaceuticals – Evenamide potential for treatment of schizophrenia
  • SCLX: Making Decisions That Should Boost Revenue
  • SNGX: Second Confirmatory Phase 3 Trial of HyBryte in CTCL to Initiate Before End of 2024
  • SYRA: Reiterates Revenue Guidance Up 64%-100% Y/Y, Diversifying, Growing Pipeline

10 in 10 with OUE Healthcare – Sustainable Expansion across Asia

By Geoff Howie

10 in 10 with OUE Healthcare – Sustainable Expansion across Asia

Abbisko Cayman (2256.HK) – The Pipeline Lacks Investment Value, Leading to Valuation Collapse

By Xinyao (Criss) Wang

  • Abbisko’s share price has fallen since its IPO.Although Abbisko has been buying back shares and LAV has begun to increase its holdings, none of this would brighten the Company’s prospects.
  • FGFR and CSF-1R are not very likely to generate blockbuster products.Even with the cooperation of MNCs, peak sales of Abbisko’s products could still be low due to “flaws” on targets.
  • There would be very limited imagination of Abbisko’s future valuation expansion. This may largely explain why stock price continues to decline. Investors’re advised to make rational judgments about the Company.

LTRN: Expanding Horizons into Asia

By Zacks Small Cap Research

  • Lantern Pharma uses AI & data to identify drug responders, uncover mechanism of action & rescue failed drugs.
  • It is developing LP-300 for non- & never smoker NSCLC in the Harmonic trial.
  • Secondary candidates include LP-100 for mCRPC and LP-184 and LP-284 which are in clinical development for multiple biomarker-defined tumors and hematological cancers, respectively.

Newron Pharmaceuticals – Evenamide potential for treatment of schizophrenia

By Edison Investment Research

Newron Pharmaceuticals has released additional data from its Phase II/III trial (study 008A), providing further evidence to support evenamide’s potential in schizophrenia. After four weeks of treatment, the mean score on the Clinical Global Impression of Change (CGI-C) scale, a key secondary efficacy measure, was 3.3 versus 3.5 for placebo, with the lower score translating to more favourable outcomes. Also, 31.3% of patients rated ‘much improved’ versus 17.3% on placebo. The update indicated that all the major efficacy measures increased over time, similar to the trend seen in the Phase II 014/015 study, albeit in a larger, randomised, placebo-controlled setting. The results highlight the drug’s potential as an effective long-term treatment in a segment with limited treatment options. As previously discussed, a potentially pivotal Phase III study in treatment-resistant schizophrenia (TRS) (study 017) is in the works, and expected to commence within 2024.

SCLX: Making Decisions That Should Boost Revenue

By Zacks Small Cap Research

  • SCLX is filling a much-needed area of the health care sector, that of developing non-opioid pain relief products.
  • The company already has commercialized products that are proven to improve patients’ lives.
  • The company reported 1Q2024 results that were a little shy of estimates, but growth continues, and the product line should accelerate growth in the coming years.

SNGX: Second Confirmatory Phase 3 Trial of HyBryte in CTCL to Initiate Before End of 2024

By Zacks Small Cap Research

  • On May 10, 2024, Soligenix, Inc. (SNGX) announced financial results for the first quarter of 2024 and provided a business update.
  • The company recently completed a public offering for gross proceeds of approximately $4.75 million.
  • This capital infusion is important as the company prepares to initiate a second Phase 3 trial of HyBryte (synthetic hypericin) in the treatment of cutaneous T cell lymphoma (CTCL).

SYRA: Reiterates Revenue Guidance Up 64%-100% Y/Y, Diversifying, Growing Pipeline

By Zacks Small Cap Research

  • The company attributed the strong topline to investments in technology and personnel made in recent quarters to support expected growth.
  • The Caduceus sub-contract is not included in guidance and so therefore could provide upside, depending on when it comes on stream.
  • Moreover, SYRA is optimistic about potential new federal business.

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May 15
0

Daily Brief Consumer: Alibaba Group Holding , Li Auto , Cheerwin, GHCL Textiles, China Tourism Group Duty Free, ContextLogic , Lands’ End Inc, Cinemark Holdings, Vail Resorts and more

By | Consumer, Daily Briefs

In today’s briefing:

  • Alibaba (9988 HK): 4Q24, Main Business Began to Grow
  • Quiddity HSTECH Jun 24 Final Expectations: US$1.6bn One-Way; Li Auto, JD, Xiaomi, Meituan, & Tencent
  • Asian Dividend Gems: Cheerwin – Number One Provider of Mosquito Repellents in China
  • GHCL Textile Q4 FY24 Update
  • CTG Duty Free (1800 HK): Down and Out?
  • Contextlogic Inc (WISH) – Tuesday, Feb 13, 2024
  • LE: Snapping the Catalog: The “New” Lands’ End Swim; Reiterate Buy & $14 PT
  • Cinemark Holdings Inc (CNK) – Tuesday, Feb 13, 2024
  • Vail Resorts Inc (MTN) – Tuesday, Feb 13, 2024

Alibaba (9988 HK): 4Q24, Main Business Began to Grow

By Ming Lu

  • Customer management as the largest business began to increase compared to the past two stagnant quarters.
  • We believe margin will continue to decline as the company turned its focus to growth.
  • We conclude an upside of 41% for March 2025 based on peer companies’ P/S ratios.

Quiddity HSTECH Jun 24 Final Expectations: US$1.6bn One-Way; Li Auto, JD, Xiaomi, Meituan, & Tencent

By Janaghan Jeyakumar, CFA

  • The HSTECH Index tracks the performance of the top 30 technology companies listed in Hong Kong that have high business exposure to certain technology themes.
  • The final results for the June 2024 index rebal event will be confirmed after market close on Friday 17th May 2024.
  • In this insight, we take a look at our latest flow expectations.

Asian Dividend Gems: Cheerwin – Number One Provider of Mosquito Repellents in China

By Douglas Kim

  • Cheerwin is a strong turnaround story with significant earnings growth in 2023 with solid dividend yield. It is the number one player in the inspect repellent sector in China. 
  • Cheerwin’s current price is 79% lower than the IPO  price. However, Cheerwin’s shares are up 35% YTD, sharply outperforming Hang Seng index which is up 13.6% YTD.
  • We found Cheerwin (6601 HK) using Smartkarma’s Smart Score Screener system. We used the following screening methodology: Market cap – More than $300 million Dividends = 5 only.

GHCL Textile Q4 FY24 Update

By Sudarshan Bhandari

  • GHCL Textiles (GHCLTEXT IN)  Aiming 25-30% revenue growth along with 15-20% average margins significantly increase the profitability of the company.
  • Entering into value-added products like Functional fabrics and setting up their own manufacturing plant for fabric.
  • Management Guidance on yarn prices, capex and debt profile of the company.

CTG Duty Free (1800 HK): Down and Out?

By Osbert Tang, CFA

  • While its share price has collapsed, China Tourism Group Duty Free (1880 HK) is still facing many challenges and uncertainties which render it unattractive at current level.
  • Average duty free spending per customer in Hainan is 46% lower than the peak and 26% lower YoY in Mar 2024, and the downtrend looks to continue.
  • The government’s efforts to strike down purchasing agents in Hainan duty free products and the island’s change to a duty-free zone are also negative developments.

Contextlogic Inc (WISH) – Tuesday, Feb 13, 2024

By Value Investors Club

  • textLogic Inc. has entered into a definitive agreement to merge with Qoo10, a leading Asian e-commerce platform
  • The deal values Wish at less than its estimated book value as of 12/31/23, reflecting the company’s struggles, but presents opportunities for growth and synergies
  • The merger will allow ContextLogic to focus on monetizing its valuable NOLs and cash position, potentially unlocking additional value for shareholders and signaling a new chapter for Wish as it moves past its downfall

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

LE: Snapping the Catalog: The “New” Lands’ End Swim; Reiterate Buy & $14 PT

By Small Cap Consumer Research

  • We are reiterating our Buy rating, $14 price target, and projections for Lands’ End after reviewing the May catalogs for 2023 and 2024.
  • The overwhelming focus for this month is swim, one of the core categories for the company.
  • Lands’ End continues to drive deeper levels of newness to capture higher pricing and create a sense of urgency for purchases.

Cinemark Holdings Inc (CNK) – Tuesday, Feb 13, 2024

By Value Investors Club

  • Cinemark Holdings, Inc. is the 3rd largest movie theater chain in North America with over 500 theaters, making it a compelling risk/reward investment opportunity
  • Stock has decreased in value due to concerns about potential impact of Hollywood strikes in 2024, but analysts anticipate a return to box office growth by mid-3Q 2024 and a focus on blockbuster films in 2025
  • Analysts project >50% return in equity over next 6 to 12 months, with potential for greater gains in the future, citing Cinemark’s strong position in suburban areas with lower rent costs as an added attraction for investors

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

Vail Resorts Inc (MTN) – Tuesday, Feb 13, 2024

By Value Investors Club

  • Vail Resorts has underperformed benchmarks in the past but is now poised for a turnaround
  • The company has expanded its portfolio to 41 strategically located destinations and increased EBITDA and revenue by over 50% since 2018
  • Despite increased leverage from acquisitions, the management team has effectively managed disruptions to the business and presents an attractive investment opportunity with potential for growth

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

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