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Smartkarma Daily Briefs

Dec 29
0

Daily Brief Consumer: Li Ning, Aditya Vision, Mitsubishi Shokuhin and more

By | Consumer, Daily Briefs

In today’s briefing:

  • HK CEO & Director Dealings (29 Dec 2023): Li Ning, Meitu
  • Postcard from Patna | Breaking Sterotypes
  • Retail Media: A Major New Income Stream Even for Wholesalers

HK CEO & Director Dealings (29 Dec 2023): Li Ning, Meitu

By David Blennerhassett

  • The data in this insight is collated from the “shareholding disclosure” link on the HKEx website
  • Often there is a corresponding HKEx announcement on the increase – or decrease – in the shareholding by directors. Or pledging. However, such disclosures are by no means an absolute.
  • The key stocks mentioned in this regular insight is Li Ning (2331 HK) and Meitu Inc (1357 HK).

Postcard from Patna | Breaking Sterotypes

By Pranav Bhavsar

Retail Media: A Major New Income Stream Even for Wholesalers

By Michael Causton

  • Seven Eleven and Familymart have already sent panic through the offices of major advertising agencies by setting up their own retail media networks. 
  • Now, Mitsubishi Shokuhin will do the same, using its trading company connections and  its existing ties to 10,000 clients at either end of the supply chain.
  • To personalise ads, it is working with the data analysis of geolocation company Unerry. 

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Dec 29
0

Daily Brief Thailand: Delta Electronics Thailand and more

By | Daily Briefs, Thailand

In today’s briefing:

  • Delta Taiwan Vs. Thailand Monitor: Parent Could Sell More of Its Stake; Thai 50x PER Vs. Taiwan 20x

Delta Taiwan Vs. Thailand Monitor: Parent Could Sell More of Its Stake; Thai 50x PER Vs. Taiwan 20x

By Vincent Fernando, CFA

  • Delta Thailand vs. Taiwan valuation differential has returned to an historically extreme level.
  • For 2024E & 2025E growth expectations continue to be similar for the two companies, yet Delta Thailand’s FY2024E PER is 50x while Delta Taiwan’s is 20x.
  • We see substantial relative value in Delta Taiwan and expect likely reversion of relative valuation due to latest return to historically extreme mismatch.

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Dec 29
0

Daily Brief Australia: Boart Longyear and more

By | Australia, Daily Briefs

In today’s briefing:

  • Boart Longyear’s (ASX:BLY) Ignominious Exit

Boart Longyear’s (ASX:BLY) Ignominious Exit

By David Blennerhassett

  • Drilling services company Boart Longyear (BLY AU) has agreed to a takeover by American Industrial Partners. Boart’s five largest shareholders – collectively holding 98.86% of shares out – are supportive.
  • Highly-Leveraged Boart copped the brunt of the GFC, and never fully recovered. American Industrial Partners’ Offer values Boart at A$543mn against its 2007 IPO value of A$2.3bn.
  • The takeover is expected to be completed in the first quarter of 2024. This is done.

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Dec 29
0

Daily Brief Quantitative Analysis: “Buy the Worst” HSI Strategy: A Tragic 2023 and What About 2024? and more

By | Daily Briefs, Quantitative Analysis

In today’s briefing:

  • “Buy the Worst” HSI Strategy: A Tragic 2023 and What About 2024?
  • Hong Kong Buybacks Weekly (Dec 22nd): Tencent, AIA, Li Ning

“Buy the Worst” HSI Strategy: A Tragic 2023 and What About 2024?

By Osbert Tang, CFA

Hong Kong Buybacks Weekly (Dec 22nd): Tencent, AIA, Li Ning

By Ke Yan, CFA, FRM

  • We analyze statistics on top repurchases over one week, one month, one quarter and one year periods ended on Dec 22nd based on HKEx daily reports.
  • In the past 7 days, the top 3 companies that repurchased the most shares from the market were Tencent (700 HK), AIA (1299 HK), Li Ning (2331 HK).
  • In the past 30 days, the top 3 companies that repurchased the most shares from the market were Tencent (700 HK), AIA (1299 HK), Wuxi Biologics (2269 HK).

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Dec 29
0

Daily Brief Thematic (Sector/Industry): Ohayo Japan | US Snoozes; More Firms to Delist from TSE and more

By | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

  • Ohayo Japan | US Snoozes; More Firms to Delist from TSE
  • China Property – New Home Sales Growth Less Negative (16 Cities) To Week Ending Dec 24
  • China Property Developers In Distress – Weekly News & Announcements Tracker | Dec 22-28, 2023

Ohayo Japan | US Snoozes; More Firms to Delist from TSE

By Mark Chadwick

  • Overseas: SPX +0.0%, Marginal gains on penultimate trading day. Oil -3%
  • Today: NKY Futs -0.3% v cash. JPY141; JGC to study hydrogen production on moon!
  • Japan: Japanese firms consider delisting to enhance management amid governance reforms, requiring Tokyo Stock Exchange Prime section companies to appoint external directors for increased board independence.

China Property – New Home Sales Growth Less Negative (16 Cities) To Week Ending Dec 24

By Robert Ciemniak

  • The weekly new home sales data indicates a smaller pace of decline for the select 16 major cities with consistent data towards the year-end.
  • Xi’an stands out as an outperformer. Recent policy easing in Beijing and Shanghai may not be fully reflected in the data yet.
  • The small-sample weekly data serves as a good directional indicator as to what to expect in the national figures for the same month (published in the middle of next month).

China Property Developers In Distress – Weekly News & Announcements Tracker | Dec 22-28, 2023

By Robert Ciemniak

  • This note is a weekly curated selection of Chinese news articles and company announcements focused on developers in distress
  • We look for their deals, updates, specific project progress news (‘local signals’), as well as relevant local research commentaries about the market
  • We do not verify the underlying data or provide any opinion, we only select and summarize the information; See direct links to sources

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Dec 29
0

Daily Brief Event-Driven: StubWorld: Swire Pac Trading “Rich” As Props Announces Big Write-Down and more

By | Daily Briefs, Event-Driven

In today’s briefing:

  • StubWorld: Swire Pac Trading “Rich” As Props Announces Big Write-Down
  • Boart Longyear’s (ASX:BLY) Ignominious Exit
  • ADNOC/Covestro: Bargaining On
  • EQD | The Nikkei Will Pullback Within 1-3 Weeks
  • HK CEO & Director Dealings (29 Dec 2023): Li Ning, Meitu

StubWorld: Swire Pac Trading “Rich” As Props Announces Big Write-Down

By David Blennerhassett

  • Swire Pacific (19 HK)‘s NAV discount has narrowed, and implied stub widened, after announcing its latest buyback. Separately, Swire Properties (1972 HK) flagged a HK$4.5bn writedown on its investment property.
  • Preceding my comments on Swire are the current setup/unwind tables for Asia-Pacific Holdcos.
  • These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation >20%.

Boart Longyear’s (ASX:BLY) Ignominious Exit

By David Blennerhassett

  • Drilling services company Boart Longyear (BLY AU) has agreed to a takeover by American Industrial Partners. Boart’s five largest shareholders – collectively holding 98.86% of shares out – are supportive.
  • Highly-Leveraged Boart copped the brunt of the GFC, and never fully recovered. American Industrial Partners’ Offer values Boart at A$543mn against its 2007 IPO value of A$2.3bn.
  • The takeover is expected to be completed in the first quarter of 2024. This is done.

ADNOC/Covestro: Bargaining On

By Jesus Rodriguez Aguilar

  • Covestro AG (1COV GR) has been the subject of a potential takeover from ADNOC since Bloomberg reported on 20 June. The last reported potential offer is €60/share (c.€11.3 billion).
  • ADNOC could be willing to offer €64.5 (7.1x EV/EBITDA on mid-cycle €2,110 million EBITDA), but Covestro is rumoured to seek €70/share (typical chemicals 6x on €2,675 million EBITDA, likely demanding).
  • Considering a takeout price of €60, gross spread is 11.7% and the shares are pricing a 64% probability of deal completion. I’d be long at €53/share, as downside seems limited.

EQD | The Nikkei Will Pullback Within 1-3 Weeks

By Nico Rosti

  • The Nikkei 225 (NKY INDEX) is about to close up for the 3rd consecutive week (CC=+3), it’s towards the Q3 resistance level at 33984: it’s short-term overbought.
  • There is a good chance that the index will pull back in the next 1-3 weeks, at the moment it looks like the rally has “stalled”.
  • The pullback may be an opportunity to buy again, and ride a rebound to previous highs, we will discuss LONG levels in a separated insight.

HK CEO & Director Dealings (29 Dec 2023): Li Ning, Meitu

By David Blennerhassett

  • The data in this insight is collated from the “shareholding disclosure” link on the HKEx website
  • Often there is a corresponding HKEx announcement on the increase – or decrease – in the shareholding by directors. Or pledging. However, such disclosures are by no means an absolute.
  • The key stocks mentioned in this regular insight is Li Ning (2331 HK) and Meitu Inc (1357 HK).

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Dec 29
0

Daily Brief United States: iShares 20+ Year Treasury Bond ETF and more

By | Daily Briefs, United States

In today’s briefing:

  • A closer look at stock bond correlation

A closer look at stock bond correlation

By Fallacy Alarm

  • For me, the most unexpected aspect of recent events has been that both bonds and stocks moved up together.
  • My expectation for this year was that equities do well.
  • But I thought they would eventually shake off bonds. Economic resilience (or in fact acceleration) would then force bond investors to chase equities. 

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Dec 29
0

Daily Brief Indonesia: Kalbe Farma and more

By | Daily Briefs, Indonesia

In today’s briefing:

  • Kalbe Farma (KLBF IJ) – The End of a Long Transition

Kalbe Farma (KLBF IJ) – The End of a Long Transition

By Angus Mackintosh

  • Kalbe Farma (KLBF IJ) continued to experience a high post-COVID base effect in 3Q2023, with consumer habits shifting to leisure versus health plus there was a softening of consumer demand.
  • The company also experienced higher raw material prices and higher operating expenses which depressed margins but expectations are for a recovery in margins in 4Q2023 and FY2024. 
  • Kalbe Farma stands out as Indonesia’s largest pharmaceutical company with strong exposure to consumer health and nutritional products with rising health consciousness amongst Indonesians. Valuations do not reflect impending recovery.

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Dec 29
0

Daily Brief Equity Bottom-Up: TSMC (2330.TT; TSM.US): If Intel Was Split Up and more

By | Daily Briefs, Equity Bottom-Up

In today’s briefing:

  • TSMC (2330.TT; TSM.US): If Intel Was Split Up, What Impact Will It Have on the Foundry Industry?
  • Kalbe Farma (KLBF IJ) – The End of a Long Transition
  • Postcard from Patna | Breaking Sterotypes
  • Nihon Kohden (6849 JP): Apart from Apple Smartwatch Ban, Three More Reasons to Buy Shares
  • Delta Taiwan Vs. Thailand Monitor: Parent Could Sell More of Its Stake; Thai 50x PER Vs. Taiwan 20x
  • A closer look at stock bond correlation
  • Retail Media: A Major New Income Stream Even for Wholesalers

TSMC (2330.TT; TSM.US): If Intel Was Split Up, What Impact Will It Have on the Foundry Industry?

By Patrick Liao

  • We assume that Intel’s current business model is unable to fully meet the manufacturing needs in that case.
  • As for the Intel Foundry Business, we believe that there is potential upside for growth.
  • If Intel was doing great in Wafer Manufacturing Business, then why does it have to consider splitting up?

Kalbe Farma (KLBF IJ) – The End of a Long Transition

By Angus Mackintosh

  • Kalbe Farma (KLBF IJ) continued to experience a high post-COVID base effect in 3Q2023, with consumer habits shifting to leisure versus health plus there was a softening of consumer demand.
  • The company also experienced higher raw material prices and higher operating expenses which depressed margins but expectations are for a recovery in margins in 4Q2023 and FY2024. 
  • Kalbe Farma stands out as Indonesia’s largest pharmaceutical company with strong exposure to consumer health and nutritional products with rising health consciousness amongst Indonesians. Valuations do not reflect impending recovery.

Postcard from Patna | Breaking Sterotypes

By Pranav Bhavsar

Nihon Kohden (6849 JP): Apart from Apple Smartwatch Ban, Three More Reasons to Buy Shares

By Tina Banerjee

  • On December 26, Nihon Kohden (6849 JP) shares jumped ~15% as the company was a beneficiary of the ban on Apple (AAPL US)’s latest smartwatch models.
  • Nihon Kohden reported better-than-expected result in H1FY24. The company raised FY24 revenue forecast to ¥221.5B (+7% YoY) from ¥215.0B. The company has also raised FY24 operating and net profit guidance.
  • Currently consensus expects 2% YoY revenue growth for the company in FY25. With strong demand for existing products and new launches, the expectation seems to be conservative.  

Delta Taiwan Vs. Thailand Monitor: Parent Could Sell More of Its Stake; Thai 50x PER Vs. Taiwan 20x

By Vincent Fernando, CFA

  • Delta Thailand vs. Taiwan valuation differential has returned to an historically extreme level.
  • For 2024E & 2025E growth expectations continue to be similar for the two companies, yet Delta Thailand’s FY2024E PER is 50x while Delta Taiwan’s is 20x.
  • We see substantial relative value in Delta Taiwan and expect likely reversion of relative valuation due to latest return to historically extreme mismatch.

A closer look at stock bond correlation

By Fallacy Alarm

  • For me, the most unexpected aspect of recent events has been that both bonds and stocks moved up together.
  • My expectation for this year was that equities do well.
  • But I thought they would eventually shake off bonds. Economic resilience (or in fact acceleration) would then force bond investors to chase equities. 

Retail Media: A Major New Income Stream Even for Wholesalers

By Michael Causton

  • Seven Eleven and Familymart have already sent panic through the offices of major advertising agencies by setting up their own retail media networks. 
  • Now, Mitsubishi Shokuhin will do the same, using its trading company connections and  its existing ties to 10,000 clients at either end of the supply chain.
  • To personalise ads, it is working with the data analysis of geolocation company Unerry. 

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Dec 29
0

Daily Brief India: Aditya Vision and more

By | Daily Briefs, India

In today’s briefing:

  • Postcard from Patna | Breaking Sterotypes

Postcard from Patna | Breaking Sterotypes

By Pranav Bhavsar

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