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Smartkarma Daily Briefs

May 07
0

Daily Brief Australia: Sigma Healthcare, Adbri, Pointerra Ltd and more

By | Australia, Daily Briefs

In today’s briefing:

  • Sigma Healthcare (SIG AU): ASX200 Inclusion Now, MUCH More Squeezy Fun Later. Maybe…
  • Adbri (ABC AU): Scheme Vote on 12 June
  • Pointerra Ltd – Q4 off to a good start after a weak Q3

Sigma Healthcare (SIG AU): ASX200 Inclusion Now, MUCH More Squeezy Fun Later. Maybe…

By Travis Lundy

  • In early December, pharmacy distributor Sigma Healthcare (SIG AU) arranged a “transformational merger” with mega chain Chemist Warehouse (CWG). Effectively a reverse takeover designed to get CWG listed.
  • SIG issued shares, raising cash, enabling it so NEWCO had high enough minimum float upon merging. Financial engineering for the win. SIG popped – a kind of IPO premium trade.
  • But plenty of people are against the deal, and ACCC hasn’t yet opined (13 June is the provisional date), but on Thursday, S&P announced SIG would join ASX200 despite risks.

Adbri (ABC AU): Scheme Vote on 12 June

By Arun George

  • The Adbri (ABC AU) IE considers CRH (CRH US) and Barro’s A$3.20 offer fair and reasonable as it is within its A$ A$3.09-3.53 per share valuation range. 
  • The scheme is conditional on FIRB approval, which should be forthcoming as CRH, the offeror, is a Fortune 500 company headquartered in Ireland.
  • The offer is attractive, and this is a done deal. At the last close and for the 1 July payment, the gross/annualised spread was 1.3%/8.4%.

Pointerra Ltd – Q4 off to a good start after a weak Q3

By Research as a Service (RaaS)

  • Pureprofile Ltd (ASX:PPL) is a data analytics and consumer insights company underpinned by proprietary technology, servicing business decision makers in brands and media companies as well as market researchers.
  • Pureprofile has reported a 6% increase in Q3 FY24 revenue to $10.9m and 49% decline in Q3 EBITDA to $0.5m.
  • Q3 is seasonally the weakest quarter for PPL and EBITDA was affected, in part, by the change in executive remuneration policy to cash-based payments.

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May 07
0

Daily Brief South Korea: Hankook Tire & Technology, HD Hyundai Marine Solution , KOSDAQ 150 Index and more

By | Daily Briefs, South Korea

In today’s briefing:

  • Hankook Tire & Technology to Become the Controlling Shareholder of Hanon Systems
  • HD Hyundai Marine Solution IPO Trading – Strong Demand and Peers Continue to Rise
  • Trading Implications Of Intra-Day Naked Short Selling Rule Tightening in Korea

Hankook Tire & Technology to Become the Controlling Shareholder of Hanon Systems

By Douglas Kim

  • On 3 May, it was reported that Hankook Tire & Technology agreed to purchase a 25% in Hanon Systems for 1.37 trillion won from Hahn & Co private equity firm. 
  • After this deal, Hankook Tire & Technology will own a controlling 50.5% stake in Hanon Systems.
  • We have a negative view on Hankook Tire & Technology’s additional purchase of Hanon Systems, which has experienced a declining profit margins in the past several years.

HD Hyundai Marine Solution IPO Trading – Strong Demand and Peers Continue to Rise

By Ethan Aw

  • HD Hyundai Marine Solution (443060 KS) had raised around US$539m in its Korean IPO, after pricing the deal at the top end of KRW83,400/share.
  • HD Hyundai Marine Solution (HMS from hereon) is a ship aftermarket service provider that provides necessary services throughout a ship’s life cycle after the delivery of a new ship.
  • In this note, we will talk about the demand for the deal and other trading dynamics.

Trading Implications Of Intra-Day Naked Short Selling Rule Tightening in Korea

By Sanghyun Park

  • Aggressively curbing naked short selling may enhance flow conditions for Value-Up stocks by reducing market turnover.
  • Liquidity decline may worsen KOSDAQ’s underperformance relative to KOSPI stocks due to its higher vulnerability to liquidity fluctuations.
  • We should also monitor price impact from phased short selling in the absence of intra-day naked short selling post-regulation tightening.

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May 07
0

Daily Brief Singapore: Genting Singapore, Lion-Phillip S-Reit ETF and more

By | Daily Briefs, Singapore

In today’s briefing:

  • Seatrium initiates buyback programme
  • REIT Watch – Inflows into both S-Reit ETFs reach 19-month high in April

Seatrium initiates buyback programme

By Geoff Howie

  • Institutions were net buyers of Singapore stocks over the four trading sessions through to May 2, with S$12.9 million of net institutional inflow, as 17 primary-listed companies conducted buybacks with a total consideration of S$28.4 million.
  • Leading the net institutional inflow over the four sessions were DBS, UOB, Seatrium, City Developments, UOL Group, iFast Corporation, Singapore Tech Engineering, Singapore Exchange, Cortina Holdings, CapitaLand Integrated Commercial Trust and Hongkong Land Holdings.
  • For the month of April, Singapore stocks booked S$225 million of net institutional inflow, following S$1.15 billion of net institutional outflow in Q1.

REIT Watch – Inflows into both S-Reit ETFs reach 19-month high in April

By Geoff Howie

  • Source: SGX, Bloomberg (data as of 31 March 2024).
  • This is probably why the ETF industry exceeded US$11 trillion in global assets under management (AUM) in 2023, after growing 24 per cent year on year since the end of 2022, according to data from ETFGI.
  • The Phillip SGX APAC Dividend Leaders REIT ETF tracks the iEdge APAC ex-Japan Dividend Leaders REIT Index, which consists of 33 REITs across Australia (52 per cent by geographical breakdown), Singapore (36 per cent), and Hong Kong (12 per cent).

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May 07
0

Daily Brief Indonesia: Medco Energi, China Vanke and more

By | Daily Briefs, Indonesia

In today’s briefing:

  • Morning Views Asia: Adani Green Energy, Japfa Comfeed Indonesia, Medco Energi, Pakuwon Jati
  • Morning Views Asia: China Vanke

Morning Views Asia: Adani Green Energy, Japfa Comfeed Indonesia, Medco Energi, Pakuwon Jati

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.

Morning Views Asia: China Vanke

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.

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May 07
0

Daily Brief China: L’Occitane, Tencent, Alibaba Group Holding , Bank of Jiangsu , CPMC Holdings, Lalatech Holdings Co Ltd, China Beststudy Education Group, Huatai Securities Co Ltd (A), Hangzhou EZVIZ Network and more

By | China, Daily Briefs

In today’s briefing:

  • L’Occitane (973 HK): The Rollover Option, And Alternate Listing Valuations
  • Tencent (700 HK): 1Q24 Preview, EPS Up by 40%, But Upside Narrowed by Significant Price Rise
  • Alibaba (BABA US) 4Q24 Preview: Many Moves Under One-Digit Growth, 46% Upside
  • SSE50 Index Rebalance Preview: Financials Continue to Outperform
  • L’Occitane (973.HK) Privatization – The Offer Price Is Good Enough
  • CPMC Holdings (906 HK): ORG Nearing the Cut-Off Point for Its Competing Offer
  • Lalatech IPO: New Filing Shows March From Losses To Profits Between 2021 and 2023
  • China After-School Tutoring:  Still In The Early Innings; Prefer China Beststudy Over EDU
  • Quiddity Leaderboard SSE50/180 Jun 24: US$2bn One-Way; LONGs up +9.8% Vs SHORTs in ~2 Months
  • STAR50 Index Rebalance Preview: Adds Steamroll Deletes

L’Occitane (973 HK): The Rollover Option, And Alternate Listing Valuations

By David Blennerhassett

  • Concurrent with its HK$34/share VGO, L’Occitane (973 HK)‘s disinterested shareholders may be entitled to a share scrip alternative. IF afforded, up to 5% of shares out can participate.
  • The big unknown is whether you receive shares of the levered-up Bidco, at some as yet undetermined scrip ratio; or keep shares of L’Occitane as-is.
  • To trigger the rollover option, 10% of disinterested shareholders need to express interest by the 15th May (a Hong Kong holiday btw). A deadline without details. 

Tencent (700 HK): 1Q24 Preview, EPS Up by 40%, But Upside Narrowed by Significant Price Rise

By Ming Lu

  • We believe total revenue will grow by 7% YoY in 1Q24 and faster in the remaining three quarters of 2024.
  • We believe EPS will grow by 41% to HK$3.80, which is higher than the market consensus.
  • The stock has risen by 26% since our last Buy rating, but there is still an upside of 9% till the end of 2024.

Alibaba (BABA US) 4Q24 Preview: Many Moves Under One-Digit Growth, 46% Upside

By Ming Lu

  • We believe revenue will grow by 6% YoY in 4Q24, but by 11% for FY2026 (roughly 2025 calendar year).
  • We believe Alibaba has been actively raising its revenue growth, but this the effect cannot be seen in the short run.
  • We conclude the stock has an upside of 46% and a price target of US$120.

SSE50 Index Rebalance Preview: Financials Continue to Outperform

By Brian Freitas

  • With the review period nearing completion, 6 stocks are in inclusion zone and 9 are in deletion zone. However, there can be a maximum of 5 changes at a review.
  • We estimate a one-way turnover of 7.1% at the June rebalance leading to a one-way trade of CNY 9.9bn (US$1.37bn). Index arb balances should increase the impact on the stocks.
  • The potential inclusions (of which four are Financials) have continued to outperform the mixed bag of potential deletions. With pretty big impact on the deletes, expect further divergence.

L’Occitane (973.HK) Privatization – The Offer Price Is Good Enough

By Xinyao (Criss) Wang

  • The HK$34/share offer price is final, which exceeds all-time high closing price of HK$33.60/share since IPO in 2010. EUR6 billion is equivalent to a PE of 52.17x, higher than peers.
  • Deploying China’s sinking market is “a good story full of imagination”. However, it may fail to bring expected profits considering increasing competition/potential price war, leading to uncertain future performance growth.
  • For minority shareholders, this privatization provides an attractive opportunity to monetise their investments at a premium over market price. We don’t think the current “technical bull market” to be lasting. 

CPMC Holdings (906 HK): ORG Nearing the Cut-Off Point for Its Competing Offer

By Arun George

  • CPMC Holdings (906 HK) has a pre-conditional voluntary offer from Changping Industrial at HK$6.87 and potentially a competing offer from ORG Technology Co., Ltd. A (002701 CH). 
  • Five months after announcing its offer, Changping Industrial obtained regulatory approvals from all except SAMR, SAFE, and the Vietnam Competition Commission. 
  • An ORG offer seems unlikely due to a lack of progress in May and timing risk, as the Changping Industrial offer could be unconditional before the ORG obtains regulatory approvals.

Lalatech IPO: New Filing Shows March From Losses To Profits Between 2021 and 2023

By Daniel Hellberg

  • In this insight we show drivers of LalaTech’s +US$1bn turnaround in OpInc
  • We also evaluate which drivers are likely to generate future improvements
  • Lalatech won’t repeat incredible 2021-23 CoR, OpEx performances, in our view

China After-School Tutoring:  Still In The Early Innings; Prefer China Beststudy Over EDU

By Steve Zhou, CFA

  • China after-school tutoring remains one of the most attractive and visible sectors in the next 2-3 years time frame. 
  • Even though New Oriental Education & Techn (EDU US) had some hiccups in FY3Q24 results, they were mainly due to factors not related to the core after-school tutoring business.
  • My sector top pick is China Beststudy Education Group (3978 HK), as valuation is lower and growth is higher, though it has a much smaller market cap..

Quiddity Leaderboard SSE50/180 Jun 24: US$2bn One-Way; LONGs up +9.8% Vs SHORTs in ~2 Months

By Janaghan Jeyakumar, CFA

  • SSE 50 and SSE 180, respectively, aim to represent the performance of the 50 and 180 largest and most liquid A-share stocks listed on the Shanghai Stock Exchange.
  • The 12-month reference period used for the June 2024 review is now complete. The SSE 180 expected ADDs/DELs list has changed slightly since I published my last insight (link).
  • In this insight, we take a look at our final expectations for index changes during the June 2024 index rebal event.

STAR50 Index Rebalance Preview: Adds Steamroll Deletes

By Brian Freitas

  • With the review period complete, we forecast 3 changes for the SSE STAR50 (STAR50 INDEX) in June. All changes are migrations from/to the STAR 100 Index.
  • One way turnover is estimated at 3.4% resulting in a one-way trade of CNY 4.5bn (US$630m). There is a lot to trade from passive trackers, especially on the inclusions.
  • The potential adds have outperformed the potential deletions by ~18% over the last month with Hangzhou EZVIZ Network (688475 CH) and APT Medical (688617 CH) moving higher.

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May 07
0

Daily Brief United States: ZEEKR, Perficient Inc, WeWork , Newmont Mining, Royal Caribbean Cruises, Atlassian , Cocoa Futures, Check Point Software Tech, Juniper Networks, Western Digital and more

By | Daily Briefs, United States

In today’s briefing:

  • Zeekr IPO – Missed Targets and Related Party Deals – We Would Stick to the Bottom-End
  • EQT to Acquire Perficient for $3.0 Billion
  • Rebooting WeWork
  • Newmont Corporation: What Is Its Asset Divestments Strategy? – Major Drivers
  • Royal Caribbean Group: Focus on Millennial Customers and New Cruise Experiences! – Major Drivers
  • Atlassian Corporation: Will The New Sole CEO Help Take The Company Towards A New Growth Trajectory?
  • -30% // Cocoa Bubble Has Busted & Central Banks Buy Gold
  • Check Point Software Technologies: Potential Opportunities with NVIDIA AI Infrastructure & 5 Critical Growth Drivers
  • Juniper Networks: What Is The AI Cluster Opportunity With Ethernet Adoption! – Major Drivers
  • Western Digital Corporation: A Growing Customer Base in Enterprise SSD Space & 5 Major Growth Drivers

Zeekr IPO – Missed Targets and Related Party Deals – We Would Stick to the Bottom-End

By Sumeet Singh

  • ZEEKR (ZK US), a premium EV brand by Geely Auto (175 HK), aims to raise around US$370m in its US listing.
  • Zeekr was formed in Mar 2021 as a JV between Geely and its founder. Its first model was launched in Apr 21 with deliveries starting in Oct 21.
  • We have looked at the company’s past performance in our earlier notes. In this note, we talk about the updates from its recent filings and have a relook at valuations.

EQT to Acquire Perficient for $3.0 Billion

By Jesus Rodriguez Aguilar

  • Perficient Inc (PRFT US) agreed to be acquired by EQT, for $76/share in cash, 75% premium, 51% premium to 30-day VWAP, and c. $3 billion EV.
  • I understand EQT has opted to present an offer that the Board could not refuse, on both EV/Fwd EBITDA and Fwd P/E basis.
  • Spread is 3.6%/6.2% (gross/annualised, assuming settlement by 16 December). Long.

Rebooting WeWork

By subSPAC

  • The last week of SPACs was packed with buyouts, IPOs, and deal amendments.
  • A co-working spaces provider gets a lifeline with a restructuring deal with its creditors, while a SPAC terminates a deal with a group of companies.
  • Also, two new IPOs are announced, including one from serial sponsor Michael Klein after a three-year hiatus. Read on to find out the latest about all things SPACs. 

Newmont Corporation: What Is Its Asset Divestments Strategy? – Major Drivers

By Baptista Research

  • The first quarter 2024 earnings for Newmont Corporation presents an operational and strategic snapshot for the company in a balanced manner.
  • To lay out the salient attributes and challenges of investing in Newmont: Positively, Newmont executives highlight the company’s robust operational performance for the 1st quarter 2024.
  • Despite experiencing the loss of three employees due to on-site incidents, Newmont still looks set to meet its 2024 guidance, thereby proving the underlying stability of its operations.

Royal Caribbean Group: Focus on Millennial Customers and New Cruise Experiences! – Major Drivers

By Baptista Research

  • Royal Caribbean Group has made impressive strides in reshaping the business in the first quarter of 2024.
  • The company described its Q1 2024 as robust and experiencing an upward trajectory in business operations, bolstered by the consumers’ demand for vacation experiences.
  • The results of Q1 2024 were significantly better than anticipated, with the company’s brands being stronger than ever and demand for vacation experiences showing consistent acceleration.

Atlassian Corporation: Will The New Sole CEO Help Take The Company Towards A New Growth Trajectory?

By Baptista Research

  • Atlassian Corporation Plc, leading software and services provider, recently marked their Q3 of Fiscal Year 2024 earnings call, reporting significant growth in their Cloud customer base and paid seats, among other financial milestones.
  • However, they also made the announcement of the stepping down of co-CEO, Scott Farquhar, by August 31, 2024.
  • The growth in the Cloud customer base was highlighted as a result of the winding down of support for Server operations three and a half years ago, which yielded three times the increase in paid seats in the Cloud.

-30% // Cocoa Bubble Has Busted & Central Banks Buy Gold

By The Commodity Report

  • -30% // Cocoa Bubble Has Busted Just two weeks ago, the most-active contract hit a record of almost $12,000 a ton as the industry grappled with the fallout of severe supply shortages.
  • “It’s important to underscore that the recent downturn in cocoa prices is primarily a result of trading maneuvers, not a realignment of market fundamentals,” analysts at Fitch Solutions’ BMI unit said in a note, adding they expect volatility to persist.
  • Volatility spiked as bigger margin requirements spurred traders to close out positions, helping to drive aggregate open interest in cocoa futures to the lowest in more than a decade.

Check Point Software Technologies: Potential Opportunities with NVIDIA AI Infrastructure & 5 Critical Growth Drivers

By Baptista Research

  • The Q1 2022 earnings reveal insights into the performance of Check Point Software Technologies.
  • The company made some forward-looking statements related to its fiscal year 2022.
  • Golan reported that its earnings per share (EPS) for the first quarter grew by 13% year-on-year to reach $2.04, with a net income of $235 million marking an 8% increase year over year.

Juniper Networks: What Is The AI Cluster Opportunity With Ethernet Adoption! – Major Drivers

By Baptista Research

  • The Q3 2023 results released by Juniper Networks, Inc. showed a better-than-expected performance with significant profitability.
  • Even in a challenging macro environment, the company was able to achieve total revenue of $1.398 billion and non-GAAP earnings per share of $0.60.
  • The company anticipates that it will continue to perform well due to the increasing demands from customers for AIOps and software automation tools, which aim to improve network operations and reduce overhead costs.

Western Digital Corporation: A Growing Customer Base in Enterprise SSD Space & 5 Major Growth Drivers

By Baptista Research

  • Western Digital performed exceptionally well in the third quarter of the fiscal year 2024, with revenue of $3.5 billion, a non-GAAP gross margin of 29.3%, and non-GAAP earnings per share of $0.63, surpassing market expectations.
  • The company’s performance was bolstered by a diversified portfolio spanning multiple end markets, coupled with structural changes to its businesses enhancing its earning potential and ability to minimize business cycles.
  • It was also able to leverage a constrained supply environment for higher earnings per share.

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May 07
0

Daily Brief India: Aadhar Housing Finance Ltd, Medco Energi, Ajanta Pharma, Adani Ports & Special Economic Zone and more

By | Daily Briefs, India

In today’s briefing:

  • Aadhar Housing Finance IPO – Larger and Slower, at a Reasonable Discount
  • Morning Views Asia: Adani Green Energy, Japfa Comfeed Indonesia, Medco Energi, Pakuwon Jati
  • Ajanta Pharma (AJP IN): Stellar Q4 Performance; INR3B Buyback Plan Announced
  • Adani Ports – Earnings Flash – FY 2023-24 Results – Lucror Analytics

Aadhar Housing Finance IPO – Larger and Slower, at a Reasonable Discount

By Sumeet Singh

  • Aadhar Housing Finance (AHF) is now looking to raise 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 in our past note. In this note, we talk about valuations.

Morning Views Asia: Adani Green Energy, Japfa Comfeed Indonesia, Medco Energi, Pakuwon Jati

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.

Ajanta Pharma (AJP IN): Stellar Q4 Performance; INR3B Buyback Plan Announced

By Tina Banerjee

  • Ajanta Pharma (AJP IN) reported strong Q4FY24 results, with double-digit revenue and PAT growth, and improving margins, driven by growth across all the business segments.
  • The company has announced INR3.5B buyback plan, involving purchase of 10,28,881 equity shares (0.82% of the total paid-up equity share capital) at a price of INR2,770 per equity share.
  • Ajanta Pharma is confident of maintaining double-digit growth going ahead with the existing products gaining market share, new launches, and expansion of field force.

Adani Ports – Earnings Flash – FY 2023-24 Results – Lucror Analytics

By Leonard Law, CFA

Adani Ports and Special Economic Zone (APSEZ) has released FY 2023-24 numbers that were slightly above expectations. The company’s strong revenue and EBITDA growth (of 28% and 24% y-o-y, respectively) exceeded management’s guidance, supported by higher than estimated growth in cargo volumes. APSEZ appears poised to achieve its target of 500 MMT cargo volumes in 2025, supported by organic growth and the contribution from its latest acquisition (Gopalpur Port). Net adjusted leverage improved to 2.9x (FY 2022-23: 4.0x). We expect leverage to be stable in FY 2024-25, in line with management’s guidance.

APSEZ appears to have a renewed appetite for expansion (particularly in overseas markets, amid its already strong domestic position), which may present event risks. In the meantime, the company may remain affected by negative headlines related to corporate governance issues at the broader Adani Group.

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May 07
0

Daily Brief Japan: Jafco Co Ltd, Komatsu Ltd and more

By | Daily Briefs, Japan

In today’s briefing:

  • Revisiting Jafco (8595.T) – Company Reaches An Important Milestone
  • Komatsu (6301) | 6% TSR and Clean Energy Winner

Revisiting Jafco (8595.T) – Company Reaches An Important Milestone

By Rikki Malik

  • The company’s management fees now cover the operating costs after many years of losses
  • Recent fund raising has surpassed expectations for its latest VC fund
  • The company’s steps towards better capital allocation are trending in the right direction

Komatsu (6301) | 6% TSR and Clean Energy Winner

By Mark Chadwick

  • Komatsu’s operating profits for FY3/24 of Y607 billion (+24% YoY) surpassed estimates on strong U.S. equipment sales
  • Komatsu guides for FY3/25 operating profits of ¥557 billion (-8.3% YoY), assuming ¥140/US$
  • We believe that the market remains too focused on the near-term growth slowdown, while we believe that Komatsu is attractively priced at under 10x EV/EBIT

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May 07
0

Daily Brief Credit: Morning Views Asia: Adani Green Energy and more

By | Credit, Daily Briefs

In today’s briefing:

  • Morning Views Asia: Adani Green Energy, Japfa Comfeed Indonesia, Medco Energi, Pakuwon Jati
  • Adani Ports – Earnings Flash – FY 2023-24 Results – Lucror Analytics
  • Morning Views Asia: China Vanke

Morning Views Asia: Adani Green Energy, Japfa Comfeed Indonesia, Medco Energi, Pakuwon Jati

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.

Adani Ports – Earnings Flash – FY 2023-24 Results – Lucror Analytics

By Leonard Law, CFA

Adani Ports and Special Economic Zone (APSEZ) has released FY 2023-24 numbers that were slightly above expectations. The company’s strong revenue and EBITDA growth (of 28% and 24% y-o-y, respectively) exceeded management’s guidance, supported by higher than estimated growth in cargo volumes. APSEZ appears poised to achieve its target of 500 MMT cargo volumes in 2025, supported by organic growth and the contribution from its latest acquisition (Gopalpur Port). Net adjusted leverage improved to 2.9x (FY 2022-23: 4.0x). We expect leverage to be stable in FY 2024-25, in line with management’s guidance.

APSEZ appears to have a renewed appetite for expansion (particularly in overseas markets, amid its already strong domestic position), which may present event risks. In the meantime, the company may remain affected by negative headlines related to corporate governance issues at the broader Adani Group.

Morning Views Asia: China Vanke

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.

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May 07
0

Daily Brief Thematic (Sector/Industry): Ohayo Japan | Japan Playing Catch-Up and more

By | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

  • Ohayo Japan | Japan Playing Catch-Up
  • Examining Market Signals: The Consequences of India’s VIX Drop
  • AMD’s MI300 Disappointment, Hyperscalers Capex, and FPGAs
  • Furniture/Furnishings Weekly – May 6, 2024
  • The Highlights – Cannabis News for the Week Ending May 3, 2024

Ohayo Japan | Japan Playing Catch-Up

By Mark Chadwick

  • The market saw another day of gains as the Dow rose by 176 points, marking its fourth consecutive day of positive movement, on potential ceasefire in Gaza
  • Japan Tobacco Inc. (JT) is embarking on a significant investment of around 450 billion yen in heated cigarettes over the next three years.
  • Sony Group and U.S. investment fund Apollo Global Management have jointly proposed the acquisition of Paramount Global for $26 billion.

Examining Market Signals: The Consequences of India’s VIX Drop

By Sudarshan Bhandari

  • VIX is a measure of market sentiment; lower values generally indicate lower volatility and higher values indicate higher volatility.
  • How the market reacted to significant market moves in VIX?
  • Does the recent fall in VIX suggest correction ahead in the markets?

AMD’s MI300 Disappointment, Hyperscalers Capex, and FPGAs

By Douglas O’Laughlin

  • I will start with a AMD section. Shares are down ~6-7% on last week’s result. Let’s talk about the result and why it was so disappointing.

  • AMD exactly matched EPS, was slightly light on revenue, and guided essentially in line with Q2 guidance.

  • This also was one of the slightest EPS and revenue beats in recent years. The last time this happened, the PC segment was imploding. This time it’s embedded revenue.

Furniture/Furnishings Weekly – May 6, 2024

By Water Tower Research

  • It was a mixed week in stocks, with most Water Tower Research furniture/furnishings indexes outperforming (with Residential the weak spot following LEG’s dividend cut).
  • Our Home Goods Retailers Index (+6.0%) significantly outperformed the broader market (+0.2% to +1.0%) as well as our Mass Retailers Index (+1.8%) and our Commercial/Contract Furniture Index (+1.6%).
  • Our Residential Manufacturers & Suppliers Index declined 0.9%, driven in part by Leggett & Platt’s steep 23.9% sell-off following its 1Q24 earnings release and investor call.

The Highlights – Cannabis News for the Week Ending May 3, 2024

By Water Tower Research

  • This week, the AP reported the DEA has agreed with the HHS recommendation to move cannabis from Schedule I to Schedule III.
  • This would remove the 280E tax burden for plant-touching operators, allow for meaningful medical research, and attract new investors.
  • The US cannabis MSOS ETF gained 10.14% this week, while the global YOLO ETF climbed 7.67%. 

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