Smartkarma Daily Briefs

On 6 August, the Doosan Group announced a revised merger report. Despite some changes in the merger report, there was no change the merger ratios.
Many minority shareholders of Doosan Enerbility and Doosan Bobcat are likely to oppose this merger. The net result is an increasing probability that this merger gets cancelled, in our view.
Doosan Enerbility has set aside about 600 billion won for exercise of appraisal rights and if it exceeds this amount, the merger may be cancelled.

The Unusual Flow Trading Development Caused by SK Innovation’s Appraisal Rights Premium

By Sanghyun Park

Exceeding the ceiling doesn’t cancel the merger; SK Innovation can still proceed. With their decision confirmed, focus should shift to appraisal rights flows rather than cancellation risk.
We should focus on flow trading given the notable exercise size and potential for unprecedented market activity if institutions, including the NPS, exercise their rights due to the juicy premium.
The large exercise size and SK Innovation’s KOSPI large-cap status may create unique flow trading opportunities, with potential repurchases after new shares list.

SK Telecom: A Blue-Chip Defensive Stock That Could Outperform KOSPI Amid Market Turmoil

Amid recent market turmoil, we believe that SK Telecom could be a solid blue-chip, defensive Korean stock that could outperform the market in the next 6-12 months.
SK Telecom reported better than expected profits in 2Q 2024. The company’s sales were 0.5% higher than the consensus and its operating profit was 3.9% higher than the consensus estimates.
SK Telecom’s shareholder return policy is to return at least 50% of adjusted profit for the year on a consolidated basis.

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Aug 07

Daily Brief Australia: Iron Ore and more

By Smartkarma Daily Briefs | Australia, Daily Briefs

In today’s briefing:

Iron Ore Tracker (07-Aug-2024): Port Arrivals High, Inventory Piles up at 35 Ports

Iron Ore Tracker (07-Aug-2024): Port Arrivals High, Inventory Piles up at 35 Ports

By Sameer Taneja

Iron ore bounced from the 100 USD/ton level and has maintained a rangebound level between 95 and 130 USD/ton for the last three years.
Inventories at the ports continued to increase, surpassing 150 million tons, representing about 38 days of inventory (normalized levels around 35 days).
After Capital Group’s recent selldown, Fortescue Metals (FMG AU) looks attractive (with a trailing dividend yield of 11% and 6.5x PE) and could be worth exploring.

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Aug 07

Daily Brief Indonesia: Medco Energi and more

By Smartkarma Daily Briefs | Daily Briefs, Indonesia

In today’s briefing:

Morning Views Asia: Greentown China, Medco Energi, Vedanta Resources

Morning Views Asia: Greentown China, Medco Energi, Vedanta Resources

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.

Greentown China
Medco Energi
Vedanta Resources

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Aug 07

Daily Brief India: Medco Energi and more

By Smartkarma Daily Briefs | Daily Briefs, India

In today’s briefing:

Morning Views Asia: Greentown China, Medco Energi, Vedanta Resources

Morning Views Asia: Greentown China, Medco Energi, Vedanta Resources

Greentown China
Medco Energi
Vedanta Resources

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Aug 07

Daily Brief United States: Apple , SPDR S&P 500, Palantir Technologies , Gold, Bitcoin, S&P 500 INDEX, FiscalNote Holdings , Microsoft Corp, Dun & Bradstreet Holdings , Titan International and more

By Smartkarma Daily Briefs | Daily Briefs, United States

In today’s briefing:

Technology Select Sector Index (XLK US): Market Consultation to Avoid Reverse Turnover (NVDA/AAPL)
Global Markets Plummet as Recession Fears, Weak Jobs Report, and Israel-Iran Conflicts Escalate
Palantir Technolog Inc (PLTR) – Tuesday, May 7, 2024
Metals Decline With Risk Sentiment and Fear in Overdrive
Crypto Crisp: Bloodbath at Peak Fear
Downgrading Outlook on $SPX; Upgrading Real Estate and Staples. Many Significant Risk-Off Signals
Fiscalnote Holdings Inc (NOTE) – Tuesday, May 7, 2024
Microsoft in Troubled Waters: Navigating the Post-Outage Storm!
Dun & Bradstreet Exploring A Sale But Why? What Valuation Can It Attract?
TWI: Titan announces 2nd quarter 2024 results and provides update on industry conditions in the Agricultural and Earth Moving / Construction markets.

Technology Select Sector Index (XLK US): Market Consultation to Avoid Reverse Turnover (NVDA/AAPL)

NVIDIA Corp (NVDA US) and Apple (AAPL US) switched positions in June setting off huge flows. Those flows could reverse in September if the current index methodology is used.
To avoid frequent reverse turnover, S&P DJI have started a market consultation to change the index weighting methodology. We believe feedback will be positive and the proposals will be approved.
Apple (AAPL US) will have inflows in September while there will be outflows from Microsoft Corp (MSFT US) and NVIDIA Corp (NVDA US).

Global Markets Plummet as Recession Fears, Weak Jobs Report, and Israel-Iran Conflicts Escalate

By Uttkarsh Kohli

July saw only 114,000 new jobs versus a forecast of 180,000. Unemployment rose to 4.3%, the highest since October 2021.
The S&P 500 fell 1.8% and dropped below its 50-day moving average, tech and semiconductor sectors led significant market declines.
Implied volatility surged as the S&P 500 saw high put options activity. Analysts expect a potential market rebound later in August.

Palantir Technolog Inc (PLTR) – Tuesday, May 7, 2024

Palantir Technologies Inc. provides software solutions for government customers in national security and intelligence
Facing competition in AI products in the commercial sector, which may affect stock performance
Company founded in 2003, known for utilizing technology to extract insights from data for government operations, with significant impact on Western society.

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.

Metals Decline With Risk Sentiment and Fear in Overdrive

By Pranay Yadav

Gold, silver, and copper futures fell by 3%, 6.7%, and 4.6% respectively on Monday amidst recession fears
Gold and silver options showed bullish sentiment with significant call option buildup, while copper options saw mixed activity with high put interest in the front-month
Implied volatility surged for gold, silver, and copper, with copper IV increasing by 7 percentage points to 27% post non-farm payroll report

Crypto Crisp: Bloodbath at Peak Fear

By Mads Eberhardt

It has been a massive bloodbath across the financial markets, not just in crypto.
The Japanese Nikkei 225 Index experienced its largest intraday percentage drop since 1987.
The S&P 500 opened about 3.5% down, with the Magnificent Seven stocks plunging around 9% at the opening.

Downgrading Outlook on $SPX; Upgrading Real Estate and Staples. Many Significant Risk-Off Signals

By Joe Jasper

We are downgrading our long-term outlook to neutral (had been bullish since early-November 2023) due to rapidly deteriorating market dynamics
We still believe the S&P 500 is going through a 1- to 4-month consolidation phase, but odds have increased that this consolidation phase could be a topping pattern.
SPX is initially holding at 5100-5191 as discussed last week, but we’re not interested in knife-catching or picking a bottom, want to see stabilization/price discovery before adjusting our still-defensive posture.

Fiscalnote Holdings Inc (NOTE) – Tuesday, May 7, 2024

FiscalNote is a legal data and analytics company with a $170 million market cap
The company provides software and services in the public policy and geopolitical intelligence sector
FiscalNote generates revenue through recurring subscription services and is seen as a compelling investment opportunity with potential for margin expansion.

Microsoft in Troubled Waters: Navigating the Post-Outage Storm!

Microsoft, a technology giant with a market-leading position across various sectors, finds itself at a crossroads.
The company has demonstrated remarkable growth, with annual revenue surpassing $245 billion, driven largely by its cloud services and AI-driven innovations.
However, recent events have cast a shadow over its future prospects.

Dun & Bradstreet Exploring A Sale But Why? What Valuation Can It Attract?

Dun & Bradstreet’s exploration of potential sale stems from numerous strategic motivations typically involved in such decisions, including efforts to maximize shareholder value, capitalize on market opportunities, or strategic repositioning for future growth.
In certain instances, companies may explore sales if they believe a buyer could offer more resources, technology, or market presence that could significantly amplify the existing operations or drive deeper market penetration than could be achieved independently.
Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology.

TWI: Titan announces 2nd quarter 2024 results and provides update on industry conditions in the Agricultural and Earth Moving / Construction markets.

By Zacks Small Cap Research

Titan International is a global manufacturer of off-the-road tires, wheels and undercarriages.
The company serves the agricultural, earthmoving / construction, and consumer markets.
Recent strategic actions have created higher margins in recent years and brought the leverage ratio down to 1.8x.

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Aug 07

Daily Brief China: Greatview Aseptic Packaging, WeRide Corp, Horizon Robotics, New World Development, Eternal Beauty Holdings Limited, Hutchmed China Ltd, China Resources Beverage, Road King Infrastructure, Medco Energi and more

By Smartkarma Daily Briefs | China, Daily Briefs

In today’s briefing:

GA Pack (468 HK): Stalemate Broken as Management Considers a Possible Counteroffer
GAPack (468 HK)’s Co-Founders (Almost) Walk The Walk
WeRide Pre-IPO – Peer Comparison – Boasting Partnerships, but Peers Aren’t Too Far Behind
Horizon Robotics IPO: High Valuation Is At Risk As NEV Production Forecasts Have Weakened
NWD 17 HK Update: De-Leveraging in Process, the Biggest Beneficiary of Fed Rate Cut Cycle
Eternal Beauty Pre-IPO Tearsheet
Hutchmed China Ltd (13.HK/HCM.US) 24H1 – Fruquintinib’s US Sales Beat; Break-Even Is Within Reach
China Resources Beverage Pre-IPO – Peer Comparison – Middling
Road King – ESG Report – Lucror Analytics
Morning Views Asia: Greentown China, Medco Energi, Vedanta Resources

GA Pack (468 HK): Stalemate Broken as Management Considers a Possible Counteroffer

By Arun George

Greatview Aseptic Packaging (468 HK) disclosed that Mr Bi Hua Jeff (CEO) and Mr Hong Gang (co-founder) are contemplating a possible voluntary conditional offer. The terms and conditions were not disclosed.
Due to the recent AGM protest votes, management needed to provide a credible alternative to shareholders to ensure that Shandong Xinjufeng Technology Packaging (301296 CH)’s offer failed.
Shandong Xinjufeng’s likely game plan is to wait for a binding counteroffer, focus on satisfying the preconditions, and requisition an EGM again to get Board representation.

GAPack (468 HK)’s Co-Founders (Almost) Walk The Walk

To say Greatview Aseptic Packaging (468 HK)‘s management and Shandong Xinjufeng (301296 CH) (XJF) don’t get along is an understatement. GAPack has labelled XJF’s pre-conditional Offer hostile and unwelcome.
Last night (6th August), co-founders Jeff Bi and Gang Hong tabled a non-binding Offer. No price was mentioned. Collectively they hold 14.72% of shares out compared to XJF’s 26.8%.
A firm Offer (and price) would have been welcome, and this probably reflects on-going funding negotiations. But the announcement will give minorities pause if/when tendering into XJF’s Offer.

WeRide Pre-IPO – Peer Comparison – Boasting Partnerships, but Peers Aren’t Too Far Behind

By Clarence Chu

WeRide Corp (WER CH) is looking to raise around US$300m in its upcoming US IPO.
WeRide provides autonomous driving products and services from L2 to L4 of driving automation.
We had looked at the firm’s past performance in an earlier note. In this note, we will undertake a peer comparison.

Horizon Robotics IPO: High Valuation Is At Risk As NEV Production Forecasts Have Weakened

By Andrei Zakharov

Horizon Robotics, a leading provider of ADAS and AD solutions for passenger vehicles, plans to raise up to $500M in Hong Kong IPO.
I expect Horizon Robotics will price its IPO below last round valuation of ~$8.7B as revenue growth will slow below 50% y/y in 2024, down from 71% y/y in 2023.
The company’s key competitors, including Mobileye and Microchip Technology, revised their revenue guidance downwards for the second half of 2024.

NWD 17 HK Update: De-Leveraging in Process, the Biggest Beneficiary of Fed Rate Cut Cycle

By Jacob Cheng

In this update, we analyzed recent NWD’s corporate actions, which show their de-leveraging plan is on track
NWD, having the highest gearing among HK RE names, will become the biggest beneficiary if Fed starts a new rate cut cycle
Valuation is compelling. There is ample upside assuming a bear case scenario. It is a BUY

Eternal Beauty Pre-IPO Tearsheet

By Akshat Shah

Eternal Beauty Holdings Limited (EBHL12 HK) is looking to raise about US$200m in its upcoming Hong Kong IPO. The deal will be run by BNP Paribas, Citic, CMBI and DBS.
Eternal Beauty is the largest brand management company of perfumes in the combined markets of Mainland China, Hong Kong and Macau, in terms of retail sales in 2023.
The company has a diverse portfolio of iconic brands of not only perfumes, but also color cosmetics, skincare products, personal care products, eyewear and home fragrances under management.

Hutchmed China Ltd (13.HK/HCM.US) 24H1 – Fruquintinib’s US Sales Beat; Break-Even Is Within Reach

By Xinyao (Criss) Wang

Fruquintinib US sales continue to be the main performance driver. License-out expectations for surufatinib is low.Highlight for savolitinib is the combination with osimertinib for NSCLC, which would bring high growth.
Future playbook of HUTCHMED is “continued sharp reduction of expenses + milestones from Takeda based on fruquintinib overseas sales = rapid narrowng of losses”.2024 overseas market sales may exceed US$300m.
There is not much problem with HUTCHMED completing its performance guidance for the year 2024. Reasonable market value range for HUTCHMED is US$1.75-3.75 billion. Breakeven is expected in 2025.

China Resources Beverage Pre-IPO – Peer Comparison – Middling

By Sumeet Singh

China Resources Beverage is looking to raise US$1bn in its upcoming Hong Kong IPO.
China Resources Beverage manufactures and sells packaged drinking water and RTD soft beverages in China.
In our earlier note, we talked about the company’s past performance. In this note, we will undertake a peer comparison.

Road King – ESG Report – Lucror Analytics

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
We assess Road King’s ESG as “Adequate”, in line with the Environmental, Social and Governance scores. Controversies are “Immaterial” and Disclosure is “Adequate”.

Morning Views Asia: Greentown China, Medco Energi, Vedanta Resources

Greentown China
Medco Energi
Vedanta Resources

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Aug 07

Daily Brief Japan: Toyota Motor, Alps Logistics, Fancl Corp, Nikkei 225, Daikin Industries, Sapporo Holdings, Wacom Co Ltd, TSE Tokyo Price Index TOPIX, AZ-Com Maruwa Holdings, Axell Corp and more

By Smartkarma Daily Briefs | Daily Briefs, Japan

In today’s briefing:

Thinking About The Toyota Tender Offer Buyback
Go-To Arbs Amid Market Carnage
Fancl (4921 JP): Kirin (2503 JP) Relents and Bumps to JPY2,800
How Has the Index Rebalance Strategy Performed During Market Turmoil?
Daikin (6367) | Q1 Earnings: Frozen in Uncertainty
Sapporo Holdings: Investor Activism Sparks Short-Term Gains, Tax Reforms Ensure Long-Term Success
Wacom (6727 JP) – Preparing to Transition to a New Stage of Growth
The Number of TOPIX Components Should Be More Reduced to Raise the Quality of Engagement, Though
AZ-Com Maruwa Holdings (9090 JP): Q1 FY03/25 flash update
Axell Corp (6730 JP): Q1 FY03/25 flash update

Thinking About The Toyota Tender Offer Buyback

By Travis Lundy

In May when shares were trading near ¥3,500-3,600, Toyota announced a ¥1trln buyback. When shares fell, they announced a Tender Offer Buyback at a large discount (¥2,781/share).
Subsequently, the shares fell very sharply on Thursday 1 August, then again Friday and yesterday. That put shares WELL below the Tender Offer Price. That creates possible opportunity.
This insight discusses modalities (talk to your advisor for specific advice/info) who might do what and why. It sets parameters. But I think Toyota is cheap here.

Go-To Arbs Amid Market Carnage

As global market roil, clean M&A deals come into focus.
This insight briefly summarises those transactions in Asia/Oceania which are expected to comfortably complete, irrespective of the background noise.
Standout deals include APM Human Services (APM AU), Huafa Property Services Group (982 HK), Alps Logistics (9055 JP), I’Rom Group (2372 JP), and Arvida (ARV NZ).

Fancl (4921 JP): Kirin (2503 JP) Relents and Bumps to JPY2,800

By Arun George

Kirin Holdings (2503 JP) has increased the Fancl Corp (4921 JP) tender offer price by 4.1% to JPY2,800 and extended the offer period to 28 August. The price is final.
Kirin tried to get the required acceptances by refusing to bump and extending the offer period. However, these tactics failed, as the shares continued to trade above terms.
The Board twice asked Kirin to raise its offer higher than JPY2,800, but eventually recommended the revised offer. Nevertheless, the bump should be sufficient for Kirin to succeed.

How Has the Index Rebalance Strategy Performed During Market Turmoil?

The market turmoil over the last few trading sessions has not been kind to a simple index rebalance strategy of buying the forecast adds and selling the forecast deletes.
The overall returns and stock specific returns indicate that trades are more crowded in some indices as compared to others and traders should consider that when position sizing.
Anecdotally, periods of negative returns are followed by periods of strong returns for the strategy as weak hands are shaken out of their positions.

Daikin (6367) | Q1 Earnings: Frozen in Uncertainty

By Mark Chadwick

Q1 Operating Profit -2% YoY; weaker than analyst consensus; Full year guidance unchanged but risk to the downside
Key concerns around EU and China remain in Q1. Both regions seeing zero top line growth and heat pumps have cratered
The stock price has declined 16% since our last note, underperforming Topix by around 6%. Valuation more supportive

Sapporo Holdings: Investor Activism Sparks Short-Term Gains, Tax Reforms Ensure Long-Term Success

By Oshadhi Kumarasiri

Sapporo Holdings (2501 JP)‘s strategic position in the domestic market, coupled with untapped potential in international markets, makes the company an interesting prospect for the long-term.
3D Investment Partners’ July 2024 letter praising Sapporo’s intention to divest its real estate business has reignited investor interest in Sapporo as a play focusing on Japan’s investor activism.
Therefore, Sapporo seems interesting both in the short term and long term, as we think shares could break out to a new high with trading volumes showing signs of improvement.

Wacom (6727 JP) – Preparing to Transition to a New Stage of Growth

By Astris Advisory Japan

Wacom is a technology company specializing in the development of graphic tablets (pen tablet products), pen displays (display products), and related digital interface solutions.
Leveraging its high reputation for its branded products, it is expanding in the OEM solutions market.
Due to changes in market structure driven by demand shifting towards general-purpose tablets and lengthening replacement cycles, Wacom is focused on improving its sales mix and earnings quality by developing a service-centric growth engine.

The Number of TOPIX Components Should Be More Reduced to Raise the Quality of Engagement, Though

By Aki Matsumoto

The cost is somewhat reduced for the user because of the higher weighting of more liquid stocks. Meanwhile, selling pressure is inevitable for less liquid companies whose weights are reduced.
Even if the number of stocks decreases, 1,200 stocks isn’t small number. Also, even though the market capitalization of the components has increased, approximately 73 billion yen isn’t sufficiently liquid.
With calls for increased engagement, the number of issues remains too large for domestic asset managers, where passive funds account for a high percentage of AUM.

AZ-Com Maruwa Holdings (9090 JP): Q1 FY03/25 flash update

Revenue increased by 4.5% YoY to JPY49.7bn, while operating profit decreased by 50.5% YoY to JPY1.9bn.
Logistics segment revenue was JPY49.0bn (+4.4% YoY) with operating profit of JPY2.4bn (-36.4% YoY).
Other segment revenue was JPY689mn (+14.1% YoY) with operating profit of JPY94mn (+32.4% YoY).

Axell Corp (6730 JP): Q1 FY03/25 flash update

Sales decreased to JPY4.1bn (-9.3% YoY), operating profit to JPY528mn (-32.0% YoY), and recurring profit to JPY521mn (-34.3% YoY).
Q1 FY03/25 results achieved 62.5% of 1H sales forecast, 88.0% of operating profit, and 86.8% of recurring profit.
Sales of products for pachinko and pachislot machines decreased YoY, with graphics LSI sales dropping by 20,000 units.

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Aug 07

Most Read: Fancl Corp, Toyota Motor, Alps Logistics, China Traditional Chinese Medicine, Kokusai Electric , MoneyHero , Apple , Doosan Bobcat Inc, Nikkei 225 and more

By Smartkarma Daily Briefs | Daily Briefs, Most Read

In today’s briefing:

Fancl (4921) – Extendy-Extendy-Bumpity-Bumpity
Thinking About The Toyota Tender Offer Buyback
Go-To Arbs Amid Market Carnage
China TCM (570.HK) Privatization Update – Things Are Still Manageable
Kokusai Electric (6525): Global Index Inclusion Highly Dependent on Free Float
Smartkarma Corporate Webinar | MoneyHero Group: Driving Expansion and Innovation in Southeast Asia
Technology Select Sector Index (XLK US): Market Consultation to Avoid Reverse Turnover (NVDA/AAPL)
Fancl (4921 JP): Kirin (2503 JP) Relents and Bumps to JPY2,800
Doosan Group Revises Merger Report and Increasing Probability of Merger Getting Cancelled
How Has the Index Rebalance Strategy Performed During Market Turmoil?

Fancl (4921) – Extendy-Extendy-Bumpity-Bumpity

By Travis Lundy

The Kirin Holdings (2503 JP) Tender Offer to buy out minorities in Fancl Corp (4921 JP) closes today. Or at least the current one does.
The original deal announced was light, and the stock has traded above terms since the announcement, with one fund buying up to 7.94%.
I expect Kirin to extend and bump next week, or bump/extend now, depending on their visibility on Fancl Q1.

Thinking About The Toyota Tender Offer Buyback

By Travis Lundy

In May when shares were trading near ¥3,500-3,600, Toyota announced a ¥1trln buyback. When shares fell, they announced a Tender Offer Buyback at a large discount (¥2,781/share).
Subsequently, the shares fell very sharply on Thursday 1 August, then again Friday and yesterday. That put shares WELL below the Tender Offer Price. That creates possible opportunity.
This insight discusses modalities (talk to your advisor for specific advice/info) who might do what and why. It sets parameters. But I think Toyota is cheap here.

Go-To Arbs Amid Market Carnage

As global market roil, clean M&A deals come into focus.
This insight briefly summarises those transactions in Asia/Oceania which are expected to comfortably complete, irrespective of the background noise.
Standout deals include APM Human Services (APM AU), Huafa Property Services Group (982 HK), Alps Logistics (9055 JP), I’Rom Group (2372 JP), and Arvida (ARV NZ).

China TCM (570.HK) Privatization Update – Things Are Still Manageable

By Xinyao (Criss) Wang

What disappoints investors is that privatization progress is slower-than-expected. Since approval is in “advanced stage”, August update is eye-catching. Investors may need more patience with this type of SOE deal.
The key to the success of this privatization lies in whether CNPGC is willing to abide by its commitments. If yes, CNPGC will take all measures to solve the problems.
According to our valuation calculation, even without this privatization, HK$3.5/share is fair for China TCM. Reasonable share price is above HK$5/share. Don’t forget, the privatization is still on the agenda.

Kokusai Electric (6525): Global Index Inclusion Highly Dependent on Free Float

By Dimitris Ioannidis

IPO lock-up expiry of Kokusai Electric (6525 JP) results in a forecasted increase in free float to 35% and fcap of $2.9bn for the August 2024 review.
Secondary offering of Kokusai Electric (6525 JP) results in a forecasted increase in free float to 60-65% and latest fcap of $3.4bn- $3.7bn for the November 2024 review.
Inclusion will be determined based on fcap against the fcap threshold. Fcap uncertainty for November is largely driven by stock price fluctuations and the Greenshoe Option.

Smartkarma Corporate Webinar | MoneyHero Group: Driving Expansion and Innovation in Southeast Asia

By Smartkarma Research

For our next Corporate Webinar, we are glad to welcome MoneyHero Group’s CEO and Director, Mr Rohith Murthy and CFO, Mr Hao Qian.

In the upcoming webinar, Rohith and Hao will share a short company presentation after which, they will engage in a fireside chat with Smartkarma Insight Provider, Ishan Majumdar. The Corporate Webinar will include a live Q&A session.

The Corporate Webinar will be hosted on Tuesday, 13 August 2024, 15:00 SGT.

Register for the Webinar here

About MoneyHero Group

MoneyHero Group connects people to a better financial future. The mission at MoneyHero Group is to make all of life’s financial decisions a time saving and rewarding experience. MoneyHero Group educates consumers about personal finance, helps them decide which products are best suited for their needs, and facilitates getting the product. They connect financial institutions with their target customers and help them achieve their customer acquisition objectives.

Technology Select Sector Index (XLK US): Market Consultation to Avoid Reverse Turnover (NVDA/AAPL)

NVIDIA Corp (NVDA US) and Apple (AAPL US) switched positions in June setting off huge flows. Those flows could reverse in September if the current index methodology is used.
To avoid frequent reverse turnover, S&P DJI have started a market consultation to change the index weighting methodology. We believe feedback will be positive and the proposals will be approved.
Apple (AAPL US) will have inflows in September while there will be outflows from Microsoft Corp (MSFT US) and NVIDIA Corp (NVDA US).

Fancl (4921 JP): Kirin (2503 JP) Relents and Bumps to JPY2,800

By Arun George

Kirin Holdings (2503 JP) has increased the Fancl Corp (4921 JP) tender offer price by 4.1% to JPY2,800 and extended the offer period to 28 August. The price is final.
Kirin tried to get the required acceptances by refusing to bump and extending the offer period. However, these tactics failed, as the shares continued to trade above terms.
The Board twice asked Kirin to raise its offer higher than JPY2,800, but eventually recommended the revised offer. Nevertheless, the bump should be sufficient for Kirin to succeed.

Doosan Group Revises Merger Report and Increasing Probability of Merger Getting Cancelled

On 6 August, the Doosan Group announced a revised merger report. Despite some changes in the merger report, there was no change the merger ratios.
Many minority shareholders of Doosan Enerbility and Doosan Bobcat are likely to oppose this merger. The net result is an increasing probability that this merger gets cancelled, in our view.
Doosan Enerbility has set aside about 600 billion won for exercise of appraisal rights and if it exceeds this amount, the merger may be cancelled.

How Has the Index Rebalance Strategy Performed During Market Turmoil?

The market turmoil over the last few trading sessions has not been kind to a simple index rebalance strategy of buying the forecast adds and selling the forecast deletes.
The overall returns and stock specific returns indicate that trades are more crowded in some indices as compared to others and traders should consider that when position sizing.
Anecdotally, periods of negative returns are followed by periods of strong returns for the strategy as weak hands are shaken out of their positions.

💡 Before it’s here, it’s on Smartkarma

The Smartkarma Preview Pass is your entry to the Independent Investment Research Network

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

Aug 07

Daily Brief Industrials: Alps Logistics, Doosan Bobcat Inc, Daikin Industries, FiscalNote Holdings , AZ-Com Maruwa Holdings, Dun & Bradstreet Holdings , Duskin Co Ltd, Titan International , Yamada Consulting Group Co L and more

By Smartkarma Daily Briefs | Daily Briefs, Industrials

In today’s briefing:

Go-To Arbs Amid Market Carnage
Doosan Group Revises Merger Report and Increasing Probability of Merger Getting Cancelled
Daikin (6367) | Q1 Earnings: Frozen in Uncertainty
Fiscalnote Holdings Inc (NOTE) – Tuesday, May 7, 2024
AZ-Com Maruwa Holdings (9090 JP): Q1 FY03/25 flash update
Dun & Bradstreet Exploring A Sale But Why? What Valuation Can It Attract?
Duskin Co Ltd (4665 JP): Q1 FY03/25 flash update
TWI: Titan announces 2nd quarter 2024 results and provides update on industry conditions in the Agricultural and Earth Moving / Construction markets.
Yamada Consulting Group Co L (4792 JP): Q1 FY03/25 flash update

Go-To Arbs Amid Market Carnage

As global market roil, clean M&A deals come into focus.
This insight briefly summarises those transactions in Asia/Oceania which are expected to comfortably complete, irrespective of the background noise.
Standout deals include APM Human Services (APM AU), Huafa Property Services Group (982 HK), Alps Logistics (9055 JP), I’Rom Group (2372 JP), and Arvida (ARV NZ).

Doosan Group Revises Merger Report and Increasing Probability of Merger Getting Cancelled

On 6 August, the Doosan Group announced a revised merger report. Despite some changes in the merger report, there was no change the merger ratios.
Many minority shareholders of Doosan Enerbility and Doosan Bobcat are likely to oppose this merger. The net result is an increasing probability that this merger gets cancelled, in our view.
Doosan Enerbility has set aside about 600 billion won for exercise of appraisal rights and if it exceeds this amount, the merger may be cancelled.

Daikin (6367) | Q1 Earnings: Frozen in Uncertainty

By Mark Chadwick

Q1 Operating Profit -2% YoY; weaker than analyst consensus; Full year guidance unchanged but risk to the downside
Key concerns around EU and China remain in Q1. Both regions seeing zero top line growth and heat pumps have cratered
The stock price has declined 16% since our last note, underperforming Topix by around 6%. Valuation more supportive

Fiscalnote Holdings Inc (NOTE) – Tuesday, May 7, 2024

FiscalNote is a legal data and analytics company with a $170 million market cap
The company provides software and services in the public policy and geopolitical intelligence sector
FiscalNote generates revenue through recurring subscription services and is seen as a compelling investment opportunity with potential for margin expansion.

AZ-Com Maruwa Holdings (9090 JP): Q1 FY03/25 flash update

Revenue increased by 4.5% YoY to JPY49.7bn, while operating profit decreased by 50.5% YoY to JPY1.9bn.
Logistics segment revenue was JPY49.0bn (+4.4% YoY) with operating profit of JPY2.4bn (-36.4% YoY).
Other segment revenue was JPY689mn (+14.1% YoY) with operating profit of JPY94mn (+32.4% YoY).

Dun & Bradstreet Exploring A Sale But Why? What Valuation Can It Attract?

Dun & Bradstreet’s exploration of potential sale stems from numerous strategic motivations typically involved in such decisions, including efforts to maximize shareholder value, capitalize on market opportunities, or strategic repositioning for future growth.
In certain instances, companies may explore sales if they believe a buyer could offer more resources, technology, or market presence that could significantly amplify the existing operations or drive deeper market penetration than could be achieved independently.
Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology.

Duskin Co Ltd (4665 JP): Q1 FY03/25 flash update

The company revised its revenue forecast from JPY178.7bn to JPY178.6bn, with no segment adjustments disclosed.
Consolidated Q1 revenue rose 3.6% YoY to JPY45.2bn, marking the 14th consecutive quarter of revenue rise.
Consolidated operating profit for Q1 declined 7.5% YoY to JPY1.9bn, with OPM dipping 0.5pp YoY to 4.1%.

TWI: Titan announces 2nd quarter 2024 results and provides update on industry conditions in the Agricultural and Earth Moving / Construction markets.

By Zacks Small Cap Research

Titan International is a global manufacturer of off-the-road tires, wheels and undercarriages.
The company serves the agricultural, earthmoving / construction, and consumer markets.
Recent strategic actions have created higher margins in recent years and brought the leverage ratio down to 1.8x.

Yamada Consulting Group Co L (4792 JP): Q1 FY03/25 flash update

Revenue: JPY7.3bn (+34.0% YoY); Operating profit: JPY2.0bn (+228.5% YoY); Recurring profit: JPY2.0bn (+219.7% YoY); Net income: JPY1.6bn (+216.0% YoY).
Consulting business revenue: JPY5.1bn (+41.9% YoY); Gross profit: JPY4.5bn (+42.7% YoY); Operating profit: JPY989mn (+169.0% YoY).
Investment business revenue: JPY2.1bn; Gross profit: JPY1.1bn; Operating profit: JPY990mn, driven by the sale of investee shares.

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Aug 07

Daily Brief Industrials: Alps Logistics, Doosan Bobcat Inc, Daikin Industries, FiscalNote Holdings , AZ-Com Maruwa Holdings, Dun & Bradstreet Holdings , Duskin Co Ltd, Titan International , Yamada Consulting Group Co L and more

By Smartkarma Daily Briefs | Daily Briefs, Industrials

In today’s briefing:

Go-To Arbs Amid Market Carnage
Doosan Group Revises Merger Report and Increasing Probability of Merger Getting Cancelled
Daikin (6367) | Q1 Earnings: Frozen in Uncertainty
Fiscalnote Holdings Inc (NOTE) – Tuesday, May 7, 2024
AZ-Com Maruwa Holdings (9090 JP): Q1 FY03/25 flash update
Dun & Bradstreet Exploring A Sale But Why? What Valuation Can It Attract?
Duskin Co Ltd (4665 JP): Q1 FY03/25 flash update
TWI: Titan announces 2nd quarter 2024 results and provides update on industry conditions in the Agricultural and Earth Moving / Construction markets.
Yamada Consulting Group Co L (4792 JP): Q1 FY03/25 flash update

Go-To Arbs Amid Market Carnage

As global market roil, clean M&A deals come into focus.
This insight briefly summarises those transactions in Asia/Oceania which are expected to comfortably complete, irrespective of the background noise.
Standout deals include APM Human Services (APM AU), Huafa Property Services Group (982 HK), Alps Logistics (9055 JP), I’Rom Group (2372 JP), and Arvida (ARV NZ).

Doosan Group Revises Merger Report and Increasing Probability of Merger Getting Cancelled

On 6 August, the Doosan Group announced a revised merger report. Despite some changes in the merger report, there was no change the merger ratios.
Many minority shareholders of Doosan Enerbility and Doosan Bobcat are likely to oppose this merger. The net result is an increasing probability that this merger gets cancelled, in our view.
Doosan Enerbility has set aside about 600 billion won for exercise of appraisal rights and if it exceeds this amount, the merger may be cancelled.

Daikin (6367) | Q1 Earnings: Frozen in Uncertainty

By Mark Chadwick

Q1 Operating Profit -2% YoY; weaker than analyst consensus; Full year guidance unchanged but risk to the downside
Key concerns around EU and China remain in Q1. Both regions seeing zero top line growth and heat pumps have cratered
The stock price has declined 16% since our last note, underperforming Topix by around 6%. Valuation more supportive

Fiscalnote Holdings Inc (NOTE) – Tuesday, May 7, 2024

FiscalNote is a legal data and analytics company with a $170 million market cap
The company provides software and services in the public policy and geopolitical intelligence sector
FiscalNote generates revenue through recurring subscription services and is seen as a compelling investment opportunity with potential for margin expansion.

AZ-Com Maruwa Holdings (9090 JP): Q1 FY03/25 flash update

Revenue increased by 4.5% YoY to JPY49.7bn, while operating profit decreased by 50.5% YoY to JPY1.9bn.
Logistics segment revenue was JPY49.0bn (+4.4% YoY) with operating profit of JPY2.4bn (-36.4% YoY).
Other segment revenue was JPY689mn (+14.1% YoY) with operating profit of JPY94mn (+32.4% YoY).

Dun & Bradstreet Exploring A Sale But Why? What Valuation Can It Attract?

Dun & Bradstreet’s exploration of potential sale stems from numerous strategic motivations typically involved in such decisions, including efforts to maximize shareholder value, capitalize on market opportunities, or strategic repositioning for future growth.
In certain instances, companies may explore sales if they believe a buyer could offer more resources, technology, or market presence that could significantly amplify the existing operations or drive deeper market penetration than could be achieved independently.
Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology.

Duskin Co Ltd (4665 JP): Q1 FY03/25 flash update

The company revised its revenue forecast from JPY178.7bn to JPY178.6bn, with no segment adjustments disclosed.
Consolidated Q1 revenue rose 3.6% YoY to JPY45.2bn, marking the 14th consecutive quarter of revenue rise.
Consolidated operating profit for Q1 declined 7.5% YoY to JPY1.9bn, with OPM dipping 0.5pp YoY to 4.1%.

TWI: Titan announces 2nd quarter 2024 results and provides update on industry conditions in the Agricultural and Earth Moving / Construction markets.

By Zacks Small Cap Research

Titan International is a global manufacturer of off-the-road tires, wheels and undercarriages.
The company serves the agricultural, earthmoving / construction, and consumer markets.
Recent strategic actions have created higher margins in recent years and brought the leverage ratio down to 1.8x.

Yamada Consulting Group Co L (4792 JP): Q1 FY03/25 flash update