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Smartkarma Daily Briefs

Mar 27
0

Daily Brief Thematic (Sector/Industry): Ohayo Japan | Nvidia Loses Steam and more

By | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

  • Ohayo Japan | Nvidia Loses Steam
  • SC on Standardisation Rate for Medical Procedures: Likely Impact on Listed Hospital Players
  • Weekly Sustainable Investing Surveyor – NWeek Ended March 22, 2024

Ohayo Japan | Nvidia Loses Steam

By Mark Chadwick

  • The S&P 500 closed lower for the third consecutive session. Consumer confidence slips to lowest level since November
  • Meiji’s chocolate-themed “Mushroom Mountain” earphones vanished in 10 minutes, leaving fans craving more of the sweet sound experience.
  • Kirin’s “Sunny Wind” beer blows in with a refreshing taste and a breeze of tradition preservation.

SC on Standardisation Rate for Medical Procedures: Likely Impact on Listed Hospital Players

By Nimish Maheshwari

  • Supreme Court’s warning to enforce CGHS rates on private hospitals sparks market concerns, leading to a significant correction in hospital company stock prices.
  • Failure to standardize hospital pricing raises questions about patient affordability, quality of healthcare, and financial viability of private hospitals, impacting investors and healthcare consumers alike.
  • Explore the complexities of healthcare regulation, implications for hospital companies, and potential investment opportunities amid the evolving landscape of standardized medical treatment costs.

Weekly Sustainable Investing Surveyor – NWeek Ended March 22, 2024

By Water Tower Research

  • The WTR Sustainable Index was down by 1.1% W/W versus the S&P 500 Index (up 2.3%), the Russell 2000 Index (up 1.6%), and the Nasdaq Index (up 3.0%).
  • Energy Technology (12.5% of the index) was up by 1.5%, while Industrial Climate and Ag Technology (55.5% of the index) was up by 1.4%, ClimateTech Mining was down 3.0% and Advanced Transportation Solutions (24.2% of index) was down 8.1%.
  • Top 10 Performers: GOEV, AMTX, ZEV, LICY, LIDR, EVTV, FFIE, KULR, MVST, NEOV

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Mar 27
0

Daily Brief ECM: Globalwafers GDR Offering – Coming to Market Earlier than Anticipated and more

By | Daily Briefs, ECM

In today’s briefing:

  • Globalwafers GDR Offering – Coming to Market Earlier than Anticipated
  • Shinhan Financial Group Placement – Another Selldown, Momentum Is Strong but Deal Is Large
  • Bharti Hexacom IPO: The Bear Case
  • Pre-IPO Zhejiang Taimei Medical Technology – Be Cautious About the “valuation Bubble”
  • MIXUE/ChaPanda/Good Me/Auntea Pre-IPO – Updated Peer Comparison

Globalwafers GDR Offering – Coming to Market Earlier than Anticipated

By Ethan Aw

  • Globalwafers (6488 TT) is looking to raise up to US$681m in its GDR offering. The proceeds will be used to purchase raw materials overseas.
  • The deal is a somewhat large one to digest at 20.2 days of three month ADV and the proceeds will be used to purchase raw materials overseas. 
  • In this note, we run the deal through our ECM framework and comment on deal dynamics.

Shinhan Financial Group Placement – Another Selldown, Momentum Is Strong but Deal Is Large

By Sumeet Singh

  • BNP Paribas (BNP FP) is looking to raise around US$680m via selling 3.5% of its stake in Shinhan Financial (055550 KS).
  • This will be the fourth selldown for the stock since the start of the year. It will also be the largest one of the lot, so far.
  • In this note, we will talk about the deal dynamics and run the deal through our ECM framework.

Bharti Hexacom IPO: The Bear Case

By Arun George

  • Bharti Hexacom (6597372Z IN), a 70% owned subsidiary of Bharti Airtel (BHARTI IN), aims to raise up to US$513 million at an IPO price range of Rs542-570 per share.
  • In Bharti Hexacom IPO: The Bull Case, we highlighted the key elements of the bull case. In this note, we outline the bear case.
  • The bear case rests on low geographic diversification, slowing growth, share overhang from TCIL’s desire to exit fully, mid-tier revenue growth and EBITDA margin. 

Pre-IPO Zhejiang Taimei Medical Technology – Be Cautious About the “valuation Bubble”

By Xinyao (Criss) Wang

  • Taimei has transformed from a classic SaaS model to an industrial Internet platform, with value-added digital services as main source of revenue.However, this may not necessarily bring better financial performance.
  • Considering declining revenue growth/gross margin, as well as constantly increasing customer acquisition cost, it’s highly uncertain whether Taimei can successfully turn losses into profits in 2025 as expected by management.
  • The significant valuation changes in Series E/E+/F Financing attracted the attention of Shanghai Stock Exchange.Taimei is actually not confident in its future performance. Its valuation could be lower than Yidu.

MIXUE/ChaPanda/Good Me/Auntea Pre-IPO – Updated Peer Comparison

By Sumeet Singh

  • Mixue Group is looking to raise about US$1bn in its Hong Kong IPO, while Sichuan Baicha  (ChaPanda), Guming (Good me) and Auntea are said to be looking to raise around US$300m.
  • All four are primarily focussed on providing freshly-made drinks, including freshly-made fruit drinks, and tea, with some selling ice cream, coffee, baked goods and ready to drink beverages as well.
  • We undertook a peer comparison in Feb 2024. In this note, we add Auntea to the mix and include the latest financials for ChaPanda.

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Mar 27
0

Daily Brief Event-Driven: Roland DG (6789 JP): Taiyo Hoping for the Best as Brother Plays the Waiting Game and more

By | Daily Briefs, Event-Driven

In today’s briefing:

  • Roland DG (6789 JP): Taiyo Hoping for the Best as Brother Plays the Waiting Game
  • Block Deal Sale of 3.6% Stake in Shinhan Financial by BNP Paribas
  • HanaTour Management Sale: Minority Shareholder Tender Offer & Price Premium Assessment
  • CIMC Vehicles (1839 HK): Vote on 18 April as Uncertainty Lingers on the 90% Acceptance Threshold
  • Hanmi Science: NPS Sides With Mother (Chairwoman) And Daughter
  • Hana Tour Service: Major Shareholders Including IMM PE Likely to Sell Their Shares
  • EQD | S&P/ASX200 Pullback In Sight (This Week or the Next)
  • Quiddity Leaderboard F100/​​​250 Jun 24: LONG OCN – SHORT FSJ Could Be Interesting
  • Preference for Deleveraging, Model Update
  • W-Scope IPO Lock-Up – Part of the Parent’s Stake Will Be Freed, but It’s Been Adding Instead

Roland DG (6789 JP): Taiyo Hoping for the Best as Brother Plays the Waiting Game

By Arun George

  • In response to Roland DG Corp (6789 JP) request, on 22 March, Taiyo said it was considering a revised offer. However, Taiyo has since remained silent. 
  • Despite discussions with Brother Industries (6448 JP), the Board have not been able to eliminate dis-synergies concerns. The Board has left the decision to accept the Taiyo offer to shareholders.
  • While the Board is trying to dissuade Brother, Brother will take its offer directly to shareholders if the Taiyo offer fails. Taiyo’s behaviour suggests a reluctance to bump. 

Block Deal Sale of 3.6% Stake in Shinhan Financial by BNP Paribas

By Douglas Kim

  • After the market close on 26 March, it was announced that BNP Paribas plans to sell its 3.6% stake in Shinhan Financial in a block deal sale 18.7 million shares). 
  • The block deal sale is estimated to be about 900 billion won, which would represent one of the largest block deal sales in Korea in the past several years.
  • We have a Negative view on the Shinhan Financial Group block deal and we would not subscribe to it due to three major reasons. 

HanaTour Management Sale: Minority Shareholder Tender Offer & Price Premium Assessment

By Sanghyun Park

  • HanaTour seeks new ownership after 4 years under IMM PE. Despite COVID-19 setbacks, successful restructuring attracts attention from online travel and investment giants.
  • Market rumors hint at Yanolja and Hotels.com interest, possibly intensifying acquisition competition, leading to a higher price premium. IMM’s 16.68% stake may value at ₩250B, a 35% premium.
  • Last year’s mandatory tender offer for 50%+1 share awaits legislation. Unlikely to affect HanaTour sale. Nonetheless, potential acquirers may buy additional shares, suggesting further premium formation in share price.

CIMC Vehicles (1839 HK): Vote on 18 April as Uncertainty Lingers on the 90% Acceptance Threshold

By Arun George

  • CIMC Vehicle Group Co Ltd (1839 HK) has despatched the offer document, and the H Share HK$7.50 offer is open. The H Shareholders class vote is on 18 April.  
  • The key condition is approval by at least 75% of independent H Shareholders (<10% of all independent H Shareholders rejection) along with a 90% minimum acceptance condition.  
  • The de-rating of peers and ongoing US investigation favours meeting the 90% threshold. However, the dire minority AGM/EGM participation rates suggest that retail apathy may derail the offer. 

Hanmi Science: NPS Sides With Mother (Chairwoman) And Daughter

By Douglas Kim

  • After the market close on 26 March, it was reported that NPS has decided it will side with Chairwoman Young-Sook Song (mother) and her daughter Ju-Hyun Lim. 
  • As a result, Chairwoman Young-Sook Song (mother) and Ju-Hyun Lim have secured 40.86% of the shares, which is slightly higher than the ownership of her two sons (38.4%). 
  • In the near term, this battle for the control of the company could have a positive impact on Hanmi Science’s share price. 

Hana Tour Service: Major Shareholders Including IMM PE Likely to Sell Their Shares

By Douglas Kim

  • Hana Tour Service (039130 KS), the number one travel platform in Korea,  announced that IMM PE (controlling shareholder of the company) is planning to sell its controlling stake. 
  • The total stake in the company that is up for sale could rise to 27.78%, including stakes held by Hana Tour founder Park Sang-hwan and co-founder Kwon Hee-seok. 
  • Potential buyers of the controlling stake in Hana Tour include Yanolja, Hotels.com, Booking.com, and Trip.com.

EQD | S&P/ASX200 Pullback In Sight (This Week or the Next)

By Nico Rosti

  • The S&P/ASX 200 Index has reached a specific resistance level that often precedes a short-term pullback, when this pattern is encountered.
  • The pullback may happen next week, but this week is also a potential candidate since the 2nd week up is usually pretty weak when this pattern is encountered.
  • Hold your LONG positions and cover them to hedge. Going SHORT is probably best at the end of the week, on Friday, if the week is closing up.

Quiddity Leaderboard F100/​​​250 Jun 24: LONG OCN – SHORT FSJ Could Be Interesting

By Janaghan Jeyakumar, CFA

  • In this insight, we take a look at the potential index changes for F100 and F250 in the run-up to the June 2024 index rebal event.
  • There could be up to three intra-review changes for the F250 index during the next two months.
  • Separately, there could be one change for F100 and two changes for F250 during the regular rebalance in June 2024.

Preference for Deleveraging, Model Update

By Jesus Rodriguez Aguilar

  • Net debt improved by around €1 billion to c. €5.8 billion. Prioritising deleveraging and allocations to new venture investments over dividends seem to have a negative impact on valuation.
  • Porsche SE is viewed as a holding company of Volkswagen Group, which should warrant a discount of 15%-25% on the stock, instead of the massive 44.6% discount to NAV.
  • Assuming a typical company holding discount of 15-25% range, the current share price indicates Porsche SE is liable for the whole c. €6.5 billion legal claims.

W-Scope IPO Lock-Up – Part of the Parent’s Stake Will Be Freed, but It’s Been Adding Instead

By Sumeet Singh

  • WCP raised around US$314m via selling a mix of primary and secondary shares in its Korean IPO. The lockup on some of its parent’s stake will expire soon.
  • WCP designs, manufactures, and sells separators, which are one of the four core materials for secondary Lithium-ion batteries.
  • In this note, we will talk about the lock-up dynamics and updates since our last note.

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Mar 27
0

Daily Brief Credit: Greentown China – Earnings Flash – FY 2023 Results – Lucror Analytics and more

By | Credit, Daily Briefs

In today’s briefing:

  • Greentown China – Earnings Flash – FY 2023 Results – Lucror Analytics
  • Morning Views Asia: MGM China Holdings, Pakuwon Jati

Greentown China – Earnings Flash – FY 2023 Results – Lucror Analytics

By Leonard Law, CFA

Greentown China’s FY 2023 performance was satisfactory in our view, given the above-industry sales, stable top line and acceptable (albeit reduced) gross margin. Importantly, its access to onshore financing appears healthy and liquidity is adequate. In addition, the company remains active in land acquisitions and has a good quality land bank, mostly in high-tier cities in the Yangtze River Delta.

That said, leverage remained somewhat weak. Moreover, Greentown is more exposed to a prolonged industry downturn (vs. peers such as Longfor Group and China Vanke), due to its low recurring income and outsized exposure to the property development segment. This means that the company’s contracted sales and margins are likely to remain soft despite outperforming the industry. In the meantime, Greentown will likely focus on improving operating efficiency by maintaining a high sell-through rate and fast churn for its projects.

We revise our fundamental Credit Bias to “Negative” from “Stable”, and move our trade recommendation on the GRNCH 5.95 ’24s to “Buy” from “Hold” .

Morning Views Asia: MGM China Holdings, 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.

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Mar 27
0

Daily Brief Equity Bottom-Up: BYD (1211 HK): Strong Revenue in 2023 and to Change Strategy in 2024 and more

By | Daily Briefs, Equity Bottom-Up

In today’s briefing:

  • BYD (1211 HK): Strong Revenue in 2023 and to Change Strategy in 2024
  • Micron’s Earnings and Broadcom’s Accelerators
  • Anta Sports (2020 HK):  2024 High Conviction Update – Earnings Beat In 2H23
  • [Tencent (700 HK, BUY, TP HK$351) TP Change]: Improvement of Earning Quality Should Be Sustainable
  • Bukalapak.com (BUKA IJ) – On the Cusp of Breakeven
  • Delta Taiwan Vs. Thailand Monitor: Delta Taiwan Surges As New AI Play; But Shorts Amassing as Well
  • BABA’s Babies: They Are All Grown Up! Ali Pictures: A Blockbuster Company
  • Sinotrans (598. HK) Continues to Deliver
  • Novo Nordisk: Is the FDA Approval of Wegovy Worth an Extra $460 Bn?
  • [Meituan (3690 HK, SELL, TP HK$70) TP Change]: Margin Reflects Persistent Competitive Pressure

BYD (1211 HK): Strong Revenue in 2023 and to Change Strategy in 2024

By Ming Lu

  • Total revenue increase by 42% and automobile revenue increased by 49% in 2023.
  • The gross margin improved significantly in 2023, especially in 4Q23.
  • We believe BYD will move its focus from ‘low price for sales volume’ to ‘development of new vehicle models’.

Micron’s Earnings and Broadcom’s Accelerators

By Douglas O’Laughlin

  • I wrote about this in my recent post about HBM, and it seems almost everything I talked about became true. HBM is going to bail out the memory markets meaningfully.
  • Let’s talk about earnings, but I was hoping you could keep this post in mind while I discuss Micron.

  • These are the kinds of beats we start to see when the cycle turns. Now, the stocks have begun to anticipate this, but given the pricing dynamics of HBM, I feel very confident in Micron’s ability to hit a new cycle high in profitability.

Anta Sports (2020 HK):  2024 High Conviction Update – Earnings Beat In 2H23

By Steve Zhou, CFA

  • At noon time today, Anta Sports Products (2020 HK) released strong 2023 results which beat expectations. 
  • Anta currently trades at a forward PE of 18x based on estimated 2024 earnings (assuming a conservative 15% yoy growth in 2024 earnings). 
  • I expect the company’s net profit to grow 15-20% CAGR in 2024-2026.  Anta’s historical forward PE is around 24x since 2017. 

[Tencent (700 HK, BUY, TP HK$351) TP Change]: Improvement of Earning Quality Should Be Sustainable

By Ying Pan

  • Tencent reported C4Q23 revenue, IFRS operating profit, and non-IFRS net income in-line with our estimates and in-line with consensus, with non-game revenues exceeding while game revenue missing expectations;
  • We believe the shift from game to non-game should enhance Tencent multiples but the market might have concerns on the sustainability of this change. 
  • We believe this change is sustainable with game revenue reaccelerating and non-game revenue continues to gain weight. We cut TP by 3% to reflect slow game recovery in C1H24.

Bukalapak.com (BUKA IJ) – On the Cusp of Breakeven

By Angus Mackintosh

  • Bukalapak.com (BUKA IJ) booked a slightly weaker finish to the year than expected with a slowdown in revenue growth in 4Q2023 and a miss on adjusted EBITDA breakeven.
  • The key reason was a thinning out of non-performing specialty businesses which impacted short-term revenues but will improve revenues and adjusted EBITDA. as the focus shifts to higher take-rate businesses.
  • Bukalapak.com PT Tbk (BUKA IJ) is guiding for +15-20% revenue growth and positive adjusted EBITDA in 2024 with execution on this being paramount. Valuations remain attractive.

Delta Taiwan Vs. Thailand Monitor: Delta Taiwan Surges As New AI Play; But Shorts Amassing as Well

By Vincent Fernando, CFA

  • Delta Taiwan Outperforms Delta Thailand After Showcasing Its AI Power Efficiency Solutions at NVIDIA Corp (NVDA US)’s GTC Conference 
  • Delta Taiwan vs. Thailand Valuation Mismatch Has Corrected Further; Delta Thailand Finally Worth Less Than Its Parent
  • Short Interest Spiked for Delta Taiwan; Taiwan Rally Short-Term Overdone Due to AI Concept Stock Hype?

BABA’s Babies: They Are All Grown Up! Ali Pictures: A Blockbuster Company

By David Mudd

  • Alibaba Pictures (1060 HK) is expanding rapidly into complimentary areas such as online ticketing of cinema and live events with the recent acquisition of  Damai.cn from parent Alibaba.
  • Alibaba Group Holding (9988 HK) is considering injecting other media platform assets like Youku  to realize synergies among its portfolio of companies.
  • Ali Pictures (Alipics) legacy film production business continues to expand globally with its American film production company, Amblin which is a partnership with Steven Spielberg.

Sinotrans (598. HK) Continues to Deliver

By Rikki Malik

  • Cost and business optimisations lead to increased profits as revenues drop due to freight rate declines
  • Successfully pivoting by geography as the global trading environment changes
  • The company increases its dividend payout in a sign of confidence for the future

Novo Nordisk: Is the FDA Approval of Wegovy Worth an Extra $460 Bn?

By Avien Pillay

  • FDA approval of Wegovy is overvalued at approx. $460 billion. Market exaggerated the worth without proper assessment of weight loss results and risks associated with the drug.
  • Clinical trials showed a 14.9% weight loss with diet and exercise; real-world results would be lower. Impact on BMI for obese individuals won’t be significant. Long-term use is questionable.
  • Competition in the GLP-1 market is fierce. Novo Nordisk faces challenges in India and China, increased capex spending, and risks from compounding pharmacies and potential legal issues.

[Meituan (3690 HK, SELL, TP HK$70) TP Change]: Margin Reflects Persistent Competitive Pressure

By Ying Pan

  • Meituan reported C4Q23 revenue beat our estimate/consensus by 0.7%/1.4%; operating profit beat our estimate/consensus by 37.3%/48.6%, mainly due to order volume surprise, which is unsustainable in our view.
  • However, we think Meituan’s near term pressures did not change: (1) core biz OPM drop due to rising low-price orders and subsidies; (2) resuming competition from Eleme/Douyin/PDD
  • We maintain the stock as SELL rating but raise TP by HK$13 to HK$70 to factor in the loss cutting commitment in the community group buying biz.

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Mar 27
0

Daily Brief Crypto: Crypto Crisp: Larry Fink vs. Gary Gensler and more

By | Crypto, Daily Briefs

In today’s briefing:

  • Crypto Crisp: Larry Fink vs. Gary Gensler

Crypto Crisp: Larry Fink vs. Gary Gensler

By Mads Eberhardt

  • We are witnessing an unexpected showdown in the crypto world.
  • On one side stands Larry Fink, co-founder and CEO of BlackRock, the world’s largest asset manager.
  • On the opposite side is Gary Gensler, the chair of the U.S. Securities and Exchange Commission (SEC).

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Mar 27
0

Daily Brief Macro: Energy Cable #62: Biden is selling crude straddles and more

By | Daily Briefs, Macro

In today’s briefing:

  • Energy Cable #62: Biden is selling crude straddles, while something is cooking in China
  • Great Game – Moscow terror, Netanyahu Furious and Biden climbing polls
  • Positioning Watch – Time to get out of the cyclical trade?
  • Ifo Nugget: What reflation in Germany?
  • EUR-flation watch: Spain is the dovish hawk
  • Vietnam Politics: Infighting Won’t Derail Economy, For Now
  • CX Daily: The countdown begins: TikTok navigates uncertain future amid U.S. ban bill

Energy Cable #62: Biden is selling crude straddles, while something is cooking in China

By Andreas Steno

  • Last week we took healthy profits in some of our global reflation bets.
  • We got out of silver and copper, but remain in the broad materials ETF.
  • Data out of China is a bit unclear with some prints being bullish and others bearish and then ambiguous data points such as the BOOMING copper stock. 

Great Game – Moscow terror, Netanyahu Furious and Biden climbing polls

By Mikkel Rosenvold

  • Welcome to this week’s Great Game.
  • We’re going to try out a slightly new format this time.
  • Instead of unfolding one major topic, we will cover a couple stories more briefly, so you are covered on the most important stories in geopolitics right now.

Positioning Watch – Time to get out of the cyclical trade?

By Andreas Steno

  • Hello everyone, and welcome back to our weekly positioning watch! The weather in Copenhagen is sunny, and so is the mood in markets, with aggregate equity fund flows in the US reaching 2-year highs this week.
  • Markets are certainly back into full risk-on mode, with the Fed promising rate cuts amidst reflationary trends in the US, which is a trend that is slowly but surely spreading to the rest of the world.
  • The cyclical rebound is not truly there yet in Europe, which means that European indices are starting to get flagged as overpriced in our quant-models.

Ifo Nugget: What reflation in Germany?

By Ulrik Simmelholt

  • Price expectations in services ex. real estate continued its downtrend and we now find ourselves at 2018-19 levels in what is pointing towards lower core inflation readings in the second half of the year. 

  • Meanwhile price expectations in manufacturing climbed and looks like they have bottomed out at levels consistent with the price mandate of the ECB.

  • The drop in input prices, the global reflation story and expectations of ECB rate cuts seem to have had an effect and the question now becomes which of the two manufacturing and service price expectations will impact inflation come Summer and Fall the most.   

EUR-flation watch: Spain is the dovish hawk

By Andreas Steno

  • The preliminary European inflation numbers will be released during this week, while Germany has decided to postpone the release until after Easter.
  • We are leaning dovish relative to consensus, but due to VAT increases in Spanish electricity markets, it will not look like an outright home-run for disinflationistas in March either unless markets decide to focus on the TAX-constant HICP rates.
  • Spanish HICP (Wednesday) -> Consensus 1.4%, Steno Research 1.26% 

Vietnam Politics: Infighting Won’t Derail Economy, For Now

By Manu Bhaskaran

  • The abrupt resignation of President Thuong is a sign that a major intra-party struggle within the ruling Communist Party is underway.
  • Claims that Thuong resigned for failure to tackle corruption should be taken with more than a pinch of salt, given the politicization of the anti-corruption campaign by the party secretary-general. 
  • Pro-Growth policies will be maintained regardless of the political turnover, but prolonged turmoil will risk the country losing its moment in the sun. 

CX Daily: The countdown begins: TikTok navigates uncertain future amid U.S. ban bill

By Caixin Global

  • TikTok /Cover Story: The countdown begins: TikTok navigates uncertain future amid U.S. ban bill
  • Forum /: Premier reiterates commitment to making China a better place to do business
  • Ma Ying-jeou /: Former Taiwan leader to make first visit to Beijing

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Mar 27
0

Most Read: ZOZO Inc, Shenzhen New Industries Biomedical Engineering-A, Kokusai Electric , HD Hyundai Marine Solution , Globalwafers, Shinhan Financial, China Motor, Roland DG Corp, Hana Tour Service and more

By | Daily Briefs, Most Read

In today’s briefing:

  • Nikkei 225 Index Rebalance: DISCO, Socionext, ZOZO In; PacMetals, Sumitomo Osaka, Takara Holding Out
  • CSI300 Index Rebalance Preview: Potential Adds Outperforming Despite ETF Inflows
  • TOPIX “Big April Basket” 2024 Expectations: More High-Conviction Names; Better Trade Ideas
  • HD Hyundai Marine Solution IPO Preview
  • Globalwafers GDR Offering – Coming to Market Earlier than Anticipated
  • Shinhan Financial Group Placement – Another Selldown, Momentum Is Strong but Deal Is Large
  • Quiddity Leaderboard TDIV Jun 24: 5 Changes; US$1.2bn One-Way
  • Roland DG (6789 JP): Taiyo Hoping for the Best as Brother Plays the Waiting Game
  • Block Deal Sale of 3.6% Stake in Shinhan Financial by BNP Paribas
  • HanaTour Management Sale: Minority Shareholder Tender Offer & Price Premium Assessment

Nikkei 225 Index Rebalance: DISCO, Socionext, ZOZO In; PacMetals, Sumitomo Osaka, Takara Holding Out

By Brian Freitas

CSI300 Index Rebalance Preview: Potential Adds Outperforming Despite ETF Inflows

By Brian Freitas

  • With 85% of the review period complete, we see 11 changes for the Shanghai Shenzhen CSI 300 Index (SHSZ300 INDEX) in June.
  • We estimate one-way turnover of 1.2% at the rebalance leading to a one-way trade of CNY 7.3bn (US$1bn). There are a lot of stocks with multiple days ADV to trade.
  • The potential adds have outperformed the potential deletes despite large flows from the National Team into ETFs tracking the CSI 300 Index. That support for the potential deletes will reverse.

TOPIX “Big April Basket” 2024 Expectations: More High-Conviction Names; Better Trade Ideas

By Janaghan Jeyakumar, CFA

  • The Tokyo Stock Exchange (TSE) calculates Free-Float Weight (FFW) for each listed company and uses this value as a key component of TOPIX Index Calculation.
  • For companies with “low liquidity” the FFW will be multiplied by a fixed liquidity factor of 0.75 to derive the final FFW used for index calculation.
  • Every April, the application of this liquidity factor is reviewed by the TSE. In this insight, we take an early look at what could happen in April 2024.

HD Hyundai Marine Solution IPO Preview

By Douglas Kim

  • HD Hyundai Marine Solution is getting ready to complete its IPO in KOSPI in May 2024. This will be one of the largest IPOs in Korea in 2024. 
  • The IPO price range is from 73,300 won to 83,400 won. The IPO offering amount is from 652.4 billion won to 742.3 billion won. 
  • A key beneficiary of HD Hyundai Marine Solution IPO is HD Hyundai (62% ownership). Our NAV analysis suggests implied price of 95,632 for HD Hyundai (40% higher than current price).

Globalwafers GDR Offering – Coming to Market Earlier than Anticipated

By Ethan Aw

  • Globalwafers (6488 TT) is looking to raise up to US$681m in its GDR offering. The proceeds will be used to purchase raw materials overseas.
  • The deal is a somewhat large one to digest at 20.2 days of three month ADV and the proceeds will be used to purchase raw materials overseas. 
  • In this note, we run the deal through our ECM framework and comment on deal dynamics.

Shinhan Financial Group Placement – Another Selldown, Momentum Is Strong but Deal Is Large

By Sumeet Singh

  • BNP Paribas (BNP FP) is looking to raise around US$680m via selling 3.5% of its stake in Shinhan Financial (055550 KS).
  • This will be the fourth selldown for the stock since the start of the year. It will also be the largest one of the lot, so far.
  • In this note, we will talk about the deal dynamics and run the deal through our ECM framework.

Quiddity Leaderboard TDIV Jun 24: 5 Changes; US$1.2bn One-Way

By Janaghan Jeyakumar, CFA

  • In this insight, we take look at Quiddity’s expectations for index changes and capping flows for the TDIV Index for the June 2024 index rebal event.
  • I currently see 5 ADDs and 5 DELs but there are several names close to the border and expectations could change before the base date as prices move around.
  • The estimate for one-way flow in June 2024 is US$1.22bn.

Roland DG (6789 JP): Taiyo Hoping for the Best as Brother Plays the Waiting Game

By Arun George

  • In response to Roland DG Corp (6789 JP) request, on 22 March, Taiyo said it was considering a revised offer. However, Taiyo has since remained silent. 
  • Despite discussions with Brother Industries (6448 JP), the Board have not been able to eliminate dis-synergies concerns. The Board has left the decision to accept the Taiyo offer to shareholders.
  • While the Board is trying to dissuade Brother, Brother will take its offer directly to shareholders if the Taiyo offer fails. Taiyo’s behaviour suggests a reluctance to bump. 

Block Deal Sale of 3.6% Stake in Shinhan Financial by BNP Paribas

By Douglas Kim

  • After the market close on 26 March, it was announced that BNP Paribas plans to sell its 3.6% stake in Shinhan Financial in a block deal sale 18.7 million shares). 
  • The block deal sale is estimated to be about 900 billion won, which would represent one of the largest block deal sales in Korea in the past several years.
  • We have a Negative view on the Shinhan Financial Group block deal and we would not subscribe to it due to three major reasons. 

HanaTour Management Sale: Minority Shareholder Tender Offer & Price Premium Assessment

By Sanghyun Park

  • HanaTour seeks new ownership after 4 years under IMM PE. Despite COVID-19 setbacks, successful restructuring attracts attention from online travel and investment giants.
  • Market rumors hint at Yanolja and Hotels.com interest, possibly intensifying acquisition competition, leading to a higher price premium. IMM’s 16.68% stake may value at ₩250B, a 35% premium.
  • Last year’s mandatory tender offer for 50%+1 share awaits legislation. Unlikely to affect HanaTour sale. Nonetheless, potential acquirers may buy additional shares, suggesting further premium formation in share price.

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Mar 26
0

Daily Brief Industrials: Mma Offshore, AP Moeller – Maersk A/S, Bizlink Holding, S.F. Holding, Ocean Wilsons Holdings and more

By | Daily Briefs, Industrials

In today’s briefing:

  • MMA Offshore: A$2.60/Share Cash Offer From Seraya Partners
  • MMA Offshore (MRM AU): A Polarising Offer from Seraya Partners
  • Monthly Container Shipping Tracker | February Spot Rates Strong | Volume Firm, Too | (March 2024)
  • Quiddity Leaderboard T50/​​​100 Jun 24: TDIV Deletion Likely for Bizlink and Farglory Land
  • Monthly Chinese Express Tracker | ASPs Still Under Pressure | Weaker X-Border Volume? | (March 2024)
  • Ocean Wilsons Holdings – Strong FY23 results with strategic review in FY24

MMA Offshore: A$2.60/Share Cash Offer From Seraya Partners

By David Blennerhassett

  • Marine and subsea services provider MMA Offshore (MRM AU) has entered into a Scheme with Singapore’s Cyan Renewables. 
  • Cyan, wholly-owned by Seraya Partners, is offering A$2.60/share in cash, a 11% premium to last close and a 31% premium to the 90-day VWAP. 
  • MMA shareholder approval and FIRB are the key conditions. This Offer will tentatively complete mid-late July. 

MMA Offshore (MRM AU): A Polarising Offer from Seraya Partners

By Arun George

  • Mma Offshore (MRM AU) has entered a scheme implementation deed with Seraya Partners at A$2.60 per share, a 10.6% premium to the undisturbed price (22 March).
  • While the offer is attractive compared to historical prices, it is light compared to peer and historical multiples. Some shareholders are supportive, while others are not. 
  • The shares are trading at terms that suggest an expectation for a bump to get the vote up or a competing bidder. The offer has not been declared final.

Monthly Container Shipping Tracker | February Spot Rates Strong | Volume Firm, Too | (March 2024)

By Daniel Hellberg

  • Strong uptick in price momentum in February reflects booming spot market
  • February container throughput growth in key regions also firm, up 7.4% Y/Y
  • We suggest Short Evergreen vs Long Maersk (or ZIM) pair trade idea

Quiddity Leaderboard T50/​​​100 Jun 24: TDIV Deletion Likely for Bizlink and Farglory Land

By Janaghan Jeyakumar, CFA

  • In this insight, we take a look at the names leading the race to become ADDs/DELs for the T50 and T100 Indices for the June 2024 index rebal event.
  • I do not see any changes for the T50 index but there could be at least four changes for the T100 index based on current data.
  • If prices fluctuate significantly between now and the base date, there could be more changes.

Monthly Chinese Express Tracker | ASPs Still Under Pressure | Weaker X-Border Volume? | (March 2024)

By Daniel Hellberg

  • Headline February numbers look pretty good — but they’re misleading
  • On a combined basis, January-February data show ASPs still under pressure
  • Recent results from ZTO and J&T Global have been unimpressive, in our view

Ocean Wilsons Holdings – Strong FY23 results with strategic review in FY24

By Edison Investment Research

Ocean Wilsons Holdings’ (OCN’s) FY23 results highlight a robust performance from the Brazilian subsidiary Wilson Sons, as well as growth from the investment portfolio. Our forecasts are under review following the announcement but, prior to this, we valued OCN at 2,564p/share, which implies it is currently trading at a 48% discount. Given the strong trading and optimistic outlook, risks appear to be to the upside.

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Mar 26
0

Daily Brief Industrials: Mma Offshore, AP Moeller – Maersk A/S, Bizlink Holding, S.F. Holding, Ocean Wilsons Holdings and more

By | Daily Briefs, Industrials

In today’s briefing:

  • MMA Offshore: A$2.60/Share Cash Offer From Seraya Partners
  • MMA Offshore (MRM AU): A Polarising Offer from Seraya Partners
  • Monthly Container Shipping Tracker | February Spot Rates Strong | Volume Firm, Too | (March 2024)
  • Quiddity Leaderboard T50/​​​100 Jun 24: TDIV Deletion Likely for Bizlink and Farglory Land
  • Monthly Chinese Express Tracker | ASPs Still Under Pressure | Weaker X-Border Volume? | (March 2024)
  • Ocean Wilsons Holdings – Strong FY23 results with strategic review in FY24

MMA Offshore: A$2.60/Share Cash Offer From Seraya Partners

By David Blennerhassett

  • Marine and subsea services provider MMA Offshore (MRM AU) has entered into a Scheme with Singapore’s Cyan Renewables. 
  • Cyan, wholly-owned by Seraya Partners, is offering A$2.60/share in cash, a 11% premium to last close and a 31% premium to the 90-day VWAP. 
  • MMA shareholder approval and FIRB are the key conditions. This Offer will tentatively complete mid-late July. 

MMA Offshore (MRM AU): A Polarising Offer from Seraya Partners

By Arun George

  • Mma Offshore (MRM AU) has entered a scheme implementation deed with Seraya Partners at A$2.60 per share, a 10.6% premium to the undisturbed price (22 March).
  • While the offer is attractive compared to historical prices, it is light compared to peer and historical multiples. Some shareholders are supportive, while others are not. 
  • The shares are trading at terms that suggest an expectation for a bump to get the vote up or a competing bidder. The offer has not been declared final.

Monthly Container Shipping Tracker | February Spot Rates Strong | Volume Firm, Too | (March 2024)

By Daniel Hellberg

  • Strong uptick in price momentum in February reflects booming spot market
  • February container throughput growth in key regions also firm, up 7.4% Y/Y
  • We suggest Short Evergreen vs Long Maersk (or ZIM) pair trade idea

Quiddity Leaderboard T50/​​​100 Jun 24: TDIV Deletion Likely for Bizlink and Farglory Land

By Janaghan Jeyakumar, CFA

  • In this insight, we take a look at the names leading the race to become ADDs/DELs for the T50 and T100 Indices for the June 2024 index rebal event.
  • I do not see any changes for the T50 index but there could be at least four changes for the T100 index based on current data.
  • If prices fluctuate significantly between now and the base date, there could be more changes.

Monthly Chinese Express Tracker | ASPs Still Under Pressure | Weaker X-Border Volume? | (March 2024)

By Daniel Hellberg

  • Headline February numbers look pretty good — but they’re misleading
  • On a combined basis, January-February data show ASPs still under pressure
  • Recent results from ZTO and J&T Global have been unimpressive, in our view

Ocean Wilsons Holdings – Strong FY23 results with strategic review in FY24

By Edison Investment Research

Ocean Wilsons Holdings’ (OCN’s) FY23 results highlight a robust performance from the Brazilian subsidiary Wilson Sons, as well as growth from the investment portfolio. Our forecasts are under review following the announcement but, prior to this, we valued OCN at 2,564p/share, which implies it is currently trading at a 48% discount. Given the strong trading and optimistic outlook, risks appear to be to the upside.

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  • ✓ Unlimited Research Summaries
  • ✓ Personalised Alerts
  • ✓ Custom Watchlists
  • ✓ Company Data and News
  • ✓ Events & Webinars
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