All Posts By

Smartkarma Daily Briefs

Jan 07
0

Daily Brief ECM: MIXUE Group IPO: The Investment Case and more

By | Daily Briefs, ECM

In today’s briefing:

  • MIXUE Group IPO: The Investment Case

MIXUE Group IPO: The Investment Case

By Arun George

  • Mixue Group (MIX HK), a world-leading freshly made drinks company, filed for an HKEx IPO to raise US$0.5-1.0 billion. 
  • Mixue is China’s largest and the world’s second-largest freshly made drinks company, in terms of both the number of stores and cups sold in 9M23, according to CIC.
  • The investment case rests on a strong brand, leading market share, high revenue growth, robust cost control, stable profitability and cash generation. 

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

Sign Up for Free

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

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


Jan 07
0

Daily Brief Event-Driven: (Mostly) Asia-Pac Weekly Risk Arb Wrap: Aoki and more

By | Daily Briefs, Event-Driven

In today’s briefing:

  • (Mostly) Asia-Pac Weekly Risk Arb Wrap: Aoki, Kerry Express Thailand, JOYY, Tietto Mins, Pact Group
  • Index Rebalance & ETF Flow Recap: HSCEI, HSCI, KRX New Deal, NIFTY50, NEXT50, CNXBANK
  • Last Week in Event SPACE: HS Holdings, Celltrion Pharm, NISA, PICC/PICC P&C

(Mostly) Asia-Pac Weekly Risk Arb Wrap: Aoki, Kerry Express Thailand, JOYY, Tietto Mins, Pact Group

By David Blennerhassett

Index Rebalance & ETF Flow Recap: HSCEI, HSCI, KRX New Deal, NIFTY50, NEXT50, CNXBANK

By Brian Freitas

  • Posco DX (022100 KS) continues to drop following its section transfer from the KOSDAQ market to the KOSPI market. Short interest in the stock nearly halved in December.
  • There were big net inflows to China ETFs with creations in CSI 300 Index ETFs and redemptions in ETFs tracking the CSI 500 Index and CSI 1000 Index.
  • Creations continued in the iShares Emerging Markets ex China (EMXC US) ETF with units outstanding reaching a new high.

Last Week in Event SPACE: HS Holdings, Celltrion Pharm, NISA, PICC/PICC P&C

By David Blennerhassett

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

Sign Up for Free

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

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


Jan 07
0

Daily Brief Japan: Aoki Super, TSE Tokyo Price Index TOPIX and more

By | Daily Briefs, Japan

In today’s briefing:

  • (Mostly) Asia-Pac Weekly Risk Arb Wrap: Aoki, Kerry Express Thailand, JOYY, Tietto Mins, Pact Group
  • Investors Do Not Want to See A “P/B Improvement Plan” That Follows a Template

(Mostly) Asia-Pac Weekly Risk Arb Wrap: Aoki, Kerry Express Thailand, JOYY, Tietto Mins, Pact Group

By David Blennerhassett

Investors Do Not Want to See A “P/B Improvement Plan” That Follows a Template

By Aki Matsumoto

  • TSE’s request to raise P/B was issued March end, and the number of companies that have disclosed their improvement measures is still low, at only about 30% of all companies.
  • Companies are likely to use good examples, but because the factors that increase share price vary from company to company, companies must offer their own solutions to their own situations.
  • Investors don’t want to see “P/B improvement plan” that follows the template, but want to see compelling measures that demonstrate cash flow growth, which is based on share price appreciation.

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

Sign Up for Free

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

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


Jan 07
0

Daily Brief China: Mixue Group, CanSino Biologics and more

By | China, Daily Briefs

In today’s briefing:

  • MIXUE Group IPO: The Investment Case
  • China Healthcare Weekly (Jan.5) – WuXi XDC, GLP-1s New Game Rule, Innovent, Cansino, A-Share Outlook

MIXUE Group IPO: The Investment Case

By Arun George

  • Mixue Group (MIX HK), a world-leading freshly made drinks company, filed for an HKEx IPO to raise US$0.5-1.0 billion. 
  • Mixue is China’s largest and the world’s second-largest freshly made drinks company, in terms of both the number of stores and cups sold in 9M23, according to CIC.
  • The investment case rests on a strong brand, leading market share, high revenue growth, robust cost control, stable profitability and cash generation. 

China Healthcare Weekly (Jan.5) – WuXi XDC, GLP-1s New Game Rule, Innovent, Cansino, A-Share Outlook

By Xinyao (Criss) Wang

  • WuXi XDC remains our top pick in China healthcare. We’re optimistic about its share price performance. Cansino is stronger than imagined, and we recommend investors to be patient with it.
  • The future competitive landscape of GLP-1s would present very different situation from traditional drugs. Innovent’s Mazdutide could be a “dark horse” if the head-to-head trial against Semaglutide is successful.
  • For GLP-1s, it will be difficult to shake the first-mover position of the first two giants (Semaglutide and Tirzepatide) unless latecomers are able to show higher marginal benefits.

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

Sign Up for Free

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

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


Jan 07
0

Daily Brief Equity Bottom-Up: Mobileye Profit Warning Is A Harbinger Of Gloom As Q423 Earnings Loom and more

By | Daily Briefs, Equity Bottom-Up

In today’s briefing:

  • Mobileye Profit Warning Is A Harbinger Of Gloom As Q423 Earnings Loom
  • China Healthcare Weekly (Jan.5) – WuXi XDC, GLP-1s New Game Rule, Innovent, Cansino, A-Share Outlook
  • Vanguard (5347.TT): 1Q24F Revenue Might Decline ~10% QoQ.
  • ‘Clippy’ Having the Last Laugh? Microsoft’s Design Change to Drive AI PC Adoption; Dell Trade Update

Mobileye Profit Warning Is A Harbinger Of Gloom As Q423 Earnings Loom

By William Keating

  • From a growth forecast of >20% YoY just two months ago, 2024 is now pegged as a low-to-no growth year
  • This will be a big negative for the likes of Infineon, ST Microelectronics, NXP, Globalfoundries and HH Grace, among others. 
  • Our anticipated gloomy Q423 earnings season just got a whole lot gloomier

China Healthcare Weekly (Jan.5) – WuXi XDC, GLP-1s New Game Rule, Innovent, Cansino, A-Share Outlook

By Xinyao (Criss) Wang

  • WuXi XDC remains our top pick in China healthcare. We’re optimistic about its share price performance. Cansino is stronger than imagined, and we recommend investors to be patient with it.
  • The future competitive landscape of GLP-1s would present very different situation from traditional drugs. Innovent’s Mazdutide could be a “dark horse” if the head-to-head trial against Semaglutide is successful.
  • For GLP-1s, it will be difficult to shake the first-mover position of the first two giants (Semaglutide and Tirzepatide) unless latecomers are able to show higher marginal benefits.

Vanguard (5347.TT): 1Q24F Revenue Might Decline ~10% QoQ.

By Patrick Liao

  • Vanguard Intl Semiconductor (5347 TT) is likely to see that there could be a decline of around 10% QoQ in 1Q24F.
  • In terms of revenue contribution, Taiwan, US, China, Europe, and Japan account for approximately 40%, 20%, 15%, 15%, and 10% respectively.
  • Taiwan Semiconductor (TSMC) (2330 TT) may give up technology development at 40nm and above and transfer them to Vanguard.

‘Clippy’ Having the Last Laugh? Microsoft’s Design Change to Drive AI PC Adoption; Dell Trade Update

By Vincent Fernando, CFA

  • On January 4th, Microsoft announced a design change for PCs whereby a new physical key will be added to PC keyboards; the Microsoft Copilot key.
  • Microsoft Copilot will become a must-have for companies in our view. Initial Copilot capabilities can dramatically improve worker productivity and this should help drive AI PC upgrades for the industry.
  • CES 2024 Jan 9th – 12th will showcase AI PC models sporting Intel’s Core Ultra processors and Microsoft’s new Copilot key. We also update our Dell vs. Taiwan PCs trade.

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

Sign Up for Free

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

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


Jan 07
0

Daily Brief Crypto: A Comprehensive Analysis of Zetachain (Executive Summary) and more

By | Crypto, Daily Briefs

In today’s briefing:

  • A Comprehensive Analysis of Zetachain (Executive Summary)
  • Year Ahead for DeFi 2024 (Executive Summary)

A Comprehensive Analysis of Zetachain (Executive Summary)

By Gerryl Pay

  • Zetachain is building a bridge into a  smart contract platform in a bid to create a platform for omnichain smart contracts.
  • Omnichain smart contracts enable applications to live on multiple chains but still be connected and share liquidity.
  • There is opportunity for Zetachain to seize across DeFi, NFTs, and Ordinals. Whether this will happen comes down to strategy execution and ecosystem building.

Year Ahead for DeFi 2024 (Executive Summary)

By Gerryl Pay

  • EigenLayer emerges as a protocol reshaping the staking paradigm. Going beyond Ethereum’s security, EigenLayer greatly extends the utility of staked ETH.
  • UniswapX and other intent based apps will break DEXs out of their growth plateau. 
  • Scalability advancements through rollapps and UX improvements from next-gen wallets will make DeFi more viable for end users. 

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

Sign Up for Free

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

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


Jan 06
0

Daily Brief Industrials: Hyundai Hyms , Kerry Logistics Network, Japan Airlines, AlmavivA Contact SpA and more

By | Daily Briefs, Industrials

In today’s briefing:

  • Hyundai Hyms IPO Valuation Analysis
  • Kerry Express (KEX TB): Kerry Logistics (636 HK)’s In-Specie Triggers MTO
  • Japan Airlines: Upside to Expectations Despite A350 Loss
  • Almaviva – ESG Report – Lucror Analytics

Hyundai Hyms IPO Valuation Analysis

By Douglas Kim

  • Our base case valuation of Hyundai Hyms is implied target price of 8,025 won per share, which is 27% higher than the high end of the IPO price range. 
  • We believe Hyundai Hyms’ valuation premium to the comps is appropriate due to much stronger operating profit growth and its strong relationships with HD Hyundai Heavy Industries.
  • Hyundai Hyms’s main business includes shipbuilding equipment and related services. The company manufactures a wide variety of items necessary for ship construction, such as ship unit blocks and piping manufacturing.

Kerry Express (KEX TB): Kerry Logistics (636 HK)’s In-Specie Triggers MTO

By David Blennerhassett

Japan Airlines: Upside to Expectations Despite A350 Loss

By Neil Glynn

  • Our updated analysis suggests that JAL’s FY24 to March 2024 EBIT guidance of  ¥ 130bn remains conservative. We see  ¥ 177bn as achievable unless forward bookings weaken.
  • Our analysis of JAL’s management of inflation highlights it is outperforming many APAC and global peers, keeping unit cost increases to a minimum. 
  • Reduced overheads have proved the key driver of inflation avoidance, while stable unit personnel costs contrast starkly with US carriers in particular; JAL’s largest international market.

Almaviva – ESG Report – Lucror Analytics

By Charles Macgregor

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).

We assess Almaviva’s ESG as “Adequate”, in line with its Environmental and Governance scores. The company has a “Strong” score for the Social pillar. Controversies are “Immaterial” and Disclosure is “Adequate”.

Almaviva is an Italian company with a focus on IT services and business process outsourcing (BPO) in customer relationship management (CRM).

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

Sign Up for Free

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

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


Jan 06
0

Daily Brief TMT/Internet: United Microelectronics Corp, A10 Networks, LaKeel and more

By | Daily Briefs, TMT/Internet

In today’s briefing:

  • UMC (2303.TT; UMC.US): 1Q24F Outlook, the Wafer Demand of MediaTek and Samsung.
  • ATEN: No Fear of a Warning
  • LaKeel (4074) – Remaining Steadfast in Building Its Ecosystem

UMC (2303.TT; UMC.US): 1Q24F Outlook, the Wafer Demand of MediaTek and Samsung.

By Patrick Liao

ATEN: No Fear of a Warning

By Hamed Khorsand

  • A10 Networks (ATEN) not warning about missing consensus estimates is a positive, but not enough for a victory lap after a volatile 2023
  • The fourth quarter was of particular importance since the Company had reported third quarter revenue materially below estimates
  • Service providers represented 50 percent of ATEN’s third quarter revenue compared to 67 percent in prior years. Throughout 2023 this customer base was not consistent with their purchasing

LaKeel (4074) – Remaining Steadfast in Building Its Ecosystem

By Astris Advisory Japan

  • On track to scale – over the last 12 months we believe LaKeel has made progress in developing its ecosystem, driving new customer acquisitions, and increasing MMR for its key DX-related in-house LaKeel Products.
  • While Q1-3 FY12/2023 results highlighted risks over license sale slippages, LaKeel’s strategy remains focused on providing innovative business and technology solutions with high ROI, and reducing IT ownership costs with reusable microservices and sustainable software development.
  • Despite the slower-than-expected business development, we believe LaKeel’s products and services are differentiated to make headway in a market with a significant need for digital transformation, and its ecosystem will expand and become more commercialized.

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

Sign Up for Free

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

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


Jan 06
0

Daily Brief Industrials: Hyundai Hyms , Kerry Logistics Network, Japan Airlines, AlmavivA Contact SpA and more

By | Daily Briefs, Industrials

In today’s briefing:

  • Hyundai Hyms IPO Valuation Analysis
  • Kerry Express (KEX TB): Kerry Logistics (636 HK)’s In-Specie Triggers MTO
  • Japan Airlines: Upside to Expectations Despite A350 Loss
  • Almaviva – ESG Report – Lucror Analytics

Hyundai Hyms IPO Valuation Analysis

By Douglas Kim

  • Our base case valuation of Hyundai Hyms is implied target price of 8,025 won per share, which is 27% higher than the high end of the IPO price range. 
  • We believe Hyundai Hyms’ valuation premium to the comps is appropriate due to much stronger operating profit growth and its strong relationships with HD Hyundai Heavy Industries.
  • Hyundai Hyms’s main business includes shipbuilding equipment and related services. The company manufactures a wide variety of items necessary for ship construction, such as ship unit blocks and piping manufacturing.

Kerry Express (KEX TB): Kerry Logistics (636 HK)’s In-Specie Triggers MTO

By David Blennerhassett

Japan Airlines: Upside to Expectations Despite A350 Loss

By Neil Glynn

  • Our updated analysis suggests that JAL’s FY24 to March 2024 EBIT guidance of  ¥ 130bn remains conservative. We see  ¥ 177bn as achievable unless forward bookings weaken.
  • Our analysis of JAL’s management of inflation highlights it is outperforming many APAC and global peers, keeping unit cost increases to a minimum. 
  • Reduced overheads have proved the key driver of inflation avoidance, while stable unit personnel costs contrast starkly with US carriers in particular; JAL’s largest international market.

Almaviva – ESG Report – Lucror Analytics

By Charles Macgregor

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).

We assess Almaviva’s ESG as “Adequate”, in line with its Environmental and Governance scores. The company has a “Strong” score for the Social pillar. Controversies are “Immaterial” and Disclosure is “Adequate”.

Almaviva is an Italian company with a focus on IT services and business process outsourcing (BPO) in customer relationship management (CRM).

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

Sign Up for Free

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

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


Jan 06
0

Daily Brief Energy/Materials: Anhui Conch Cement, Petroleo Brasileiro , Crude Oil, Saudi Aramco and more

By | Daily Briefs, Energy & Materials Sector

In today’s briefing:

  • Anhui Conch Cement (914 HK):  Where Are We In The Cycle?
  • Buys Within Global Energy, Health Care, and Utilities; Bullish Outlook Intact on Global Equities
  • Part Six: Commodities: Priced for a Downturn
  • Saudi Aramco and China’s Rongsheng Plan Closer Tie-up

Anhui Conch Cement (914 HK):  Where Are We In The Cycle?

By Steve Zhou, CFA

  • Anhui Conch Cement (914 HK) is trading at a historical low forward P/B of 0.5x, compared to an average of 1.2x for the last decade. 
  • In the long term, China cement will likely see much lower volume and lower cement prices in the short term, but eventually rising cement prices due to better supply picture. 
  • As the lowest cost producer, Anhui Conch stands a very good chance to win out in the long term and potentially more than double its current market share. 

Buys Within Global Energy, Health Care, and Utilities; Bullish Outlook Intact on Global Equities

By Joe Jasper

  • Global growth stocks that have significantly outperformed since the October 2023 lows are starting to pull back, and we believe a continued pause/pullback is likely in these growth areas.
  • Meanwhile, we are seeing a clear shift into value and defensives, and we recommend adding exposure to these areas. This type of Sector rotation is common during bull markets.
  • Major supports continue to hold, including $98-99 on MSCI ACWI (ACWI-US), 4600 on the S&P 500, 4400 on the EURO STOXX 50, and 2300 on the TOPIX

Part Six: Commodities: Priced for a Downturn

By Untying The Gordian Knot

  • The clouds of recession and economic slowdown loom over the horizon, casting a bearish shadow on commodity markets.
  • Yet, despite many reasons for pessimism, commodity prices have begun to show signs of resilience last week.
  • Even though a sustained long-term rally remains uncertain, the current environment seems ripe for a short-term bounce or mean reversion.

Saudi Aramco and China’s Rongsheng Plan Closer Tie-up

By Caixin Global

  • Saudi Aramco and its Chinese partner Rongsheng Petrochemical Co. Ltd. have agreed to deepen their tie-up further by taking a stake in each other’s subsidiaries.
  • China’s privately controlled refiner Rongsheng said it signed a memorandum of understanding with Aramco to buy a 50% stake in the Saudi company’s refining unit Saudi Aramco Jubail Refinery Company (SASREF).
  • At the same time, Rongsheng plans to sell up to 50% stake in its unit Ningbo Zhongjin Petrochemical Co to Aramco, the world’s biggest oil producer, according to Rongsheng’s filing with the Shenzhen stock exchange on Tuesday.

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

Sign Up for Free

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

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