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Smartkarma Daily Briefs

Jul 23
0

Daily Brief Singapore: Thai Beverage, Mapletree Industrial Trust and more

By | Daily Briefs, Singapore

In today’s briefing:

  • Thai Beverage (THBEV SP) – Increasingly Streamlined SEA F&B Play
  • Buyback and director filings taper off during pre-earnings period

Thai Beverage (THBEV SP) – Increasingly Streamlined SEA F&B Play

By Angus Mackintosh

  • Thai Beverage will offload its entire stake in Frasers Property Ltd to TCC Assets in a share swap for an increased share in Fraser And Neave streamlining its business focus.
  • The share swap values Fraser And Neave on a par with peers which is at a significant premium to the share price but Fraser And Neave was excessively undervalued.
  • Thai Beverage deserves to trade on a higher multiple given its pure-play status and a succession of recent restructurings including Serm Suk and Oishi Holdings. 

Buyback and director filings taper off during pre-earnings period

By Geoff Howie

  • Share buybacks by primary-listed companies The five sessions also saw nine primary-listed companies conducted buybacks with a total consideration of S$4.5 million.
  • With this transaction, the total proportion of shares bought back under the current mandate now stands at 1.47 per cent of the issued shares (not counting treasury shares) as of the date when the share buyback resolution was passed.

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Jul 23
0

Daily Brief India: Trent Ltd, SAI Life Sciences, ACME Solar Holdings, Sino-Ocean Group and more

By | Daily Briefs, India

In today’s briefing:

  • NIFTY50 Index Rebalance Preview: Big Flow, Big Impact, Big Positioning
  • SAI Life Sciences Pre-IPO Tear Sheet
  • ACME Solar Holdings Pre-IPO Tearsheet
  • Morning Views Asia: Powerlong Commercial Management Holdings, Reliance Industries, Sino-Ocean Service

NIFTY50 Index Rebalance Preview: Big Flow, Big Impact, Big Positioning

By Brian Freitas

SAI Life Sciences Pre-IPO Tear Sheet

By Tina Banerjee

  • SAI Life Sciences (SAILS12 IN) is planning to raise INR50B, consisting of INR8B worth of fresh issue and the rest will be OFS. 
  • Out of the proceeds from fresh issue, the company intends to utilize INR6B for repayment/pre-payment, in full or part, of all or certain outstanding borrowings availed by the company.
  • Sai Life Sciences is the fastest-growing Indian CRDMOs among listed Indian peers in terms of revenue as well as EBITDA CAGR during FY22–24.

ACME Solar Holdings Pre-IPO Tearsheet

By Clarence Chu

  • ACME Solar Holdings (1700918D IN) is looking to raise US$360m in its upcoming India IPO. The bookrunners on the deal are ICICI, JM Financial, Kotak, Nuvama Wealth and Motilal Oswal.
  • ACME Solar (ACME) is a renewable energy firm with a portfolio of solar, wind, hybrid and firm and dispatchable renewable energy (FDRE) projects.
  • As per CRISIL, the firm was among the top 10 renewable energy players in India in terms of operational capacity as of FY24. 

Morning Views Asia: Powerlong Commercial Management Holdings, Reliance Industries, Sino-Ocean Service

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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Jul 23
0

Daily Brief United States: Microsoft Corp, Crude Oil, Copper, Symbotic, Boise Cascade Co, Vera Bradley, Centrus Energy , CoreCivic and more

By | Daily Briefs, United States

In today’s briefing:

  • [Q2 Earnings Preview] Microsoft Flying High on Tailwinds from Azure Surge, AI Leap & Gaming Boost
  • Pickup in Gas Rigs Drive U.S. Oil & Gas Rig Count Higher
  • Energy Cable: More pain to come in copper, while Nat Gas is a long trade?
  • SYM: Symbolic Overvaluation, Sell
  • Boise Cascade Co (BCC) – Monday, Apr 22, 2024
  • VRA: Snapping the Store: New Day Arrives; Reiterate Buy Rating, $10 PT
  • Centrus Energy Corp (LEU) – Monday, Apr 22, 2024
  • CXW: Strong History of Contract Retention Preview 2Q24 Results
  • The Return of La Niña // CTA Positioning Update

[Q2 Earnings Preview] Microsoft Flying High on Tailwinds from Azure Surge, AI Leap & Gaming Boost

By Uttkarsh Kohli

  • Azure Revenue Growth: Microsoft’s Azure revenue soared 21% YoY to $26.7B in Q3 2024, driven by advanced AI capabilities and increased enterprise adoption.
  • AI & Personal Computing: AI-driven Copilot+ PCs and hybrid AI solutions are reshaping the market, with AI-capable PC shipments projected to rise from 19% in 2024 to 60% by 2027.
  • Gaming + Activision: The $68.7B Activision acquisition boosted gaming revenue by 51% YoY, with Game Pass subscribers exceeding 30M and expanding Microsoft’s position in cloud gaming.

Pickup in Gas Rigs Drive U.S. Oil & Gas Rig Count Higher

By Suhas Reddy

  • US oil and gas rig count increased by two to 586 for the week ending 19/Jul, rising for the second time in the last three weeks.  
  • US oil rig count fell by 1 to 477, declining for the second straight week. Gas rigs rose by 3 to 103, after falling by one the week prior.
  • The EIA has increased its US crude production forecasts in its latest STEO report, raising them by 0.8% YoY for 2024 and 0.4% YoY for 2025. 

Energy Cable: More pain to come in copper, while Nat Gas is a long trade?

By Ulrik Simmelholt

  • Take aways: China will flood markets with copper supply
  • Copper har decoupled from macro fundamentals according to our PCA tool
  • It’s a tuck or war between positioning and fundamentals in metals. Crude tumbling despite all time highs in global flight data and crowded congestion

SYM: Symbolic Overvaluation, Sell

By Hamed Khorsand

  • We are initiating coverage of Symbotic (SYM) with a Sell Rating and $10 target. 
  • The latest quarterly report from SYM suggests there could be little in the form of catalysts with the biggest news being related to a business owned by the CEO
  • We believe investors are putting too much reliance on SYM generating revenue from Wal-Mart (WMT) even though WMT is also using SYM’s competition for warehouse automation. 

Boise Cascade Co (BCC) – Monday, Apr 22, 2024

By Value Investors Club

  • Boise has transformed under new management since spinning off from OfficeMax in 2013
  • Strategic acquisitions and investments have shifted focus towards higher-margin products
  • Repurposing lumber/plywood capacity for engineered products and closer integration between segments have positioned Boise for strong cash flow returns

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.

VRA: Snapping the Store: New Day Arrives; Reiterate Buy Rating, $10 PT

By Small Cap Consumer Research

  • We are reiterating our Buy rating, $10 price target and projections for Vera Bradley after visiting Long Island and Connecticut Vera Bradley locations.
  • With the launch of the New Day on July 11th, Vera Bradley entered a new era for their main line stores, with new fabrics, new looks, lighter and brighter fixtures, a new logo and a new spokesperson (Zooey Deschanel).
  • When the shock of the new has passed, the look and offerings are impressive and, we believe, when fully launched, will satisfy both the traditional Vera Bradley shopper looking for exciting patterns and features and drive new, younger customers that will be attracted to the compelling fashion, combinations, colors and versatility of the offerings.

Centrus Energy Corp (LEU) – Monday, Apr 22, 2024

By Value Investors Club

  • Short Centrus and long Silex Systems and Cameco to hedge against commodity price and uranium enrichment hype risk
  • Centrus underperforming and expected to trade lower due to potential ban on Russian imports
  • Long positions in Cameco and Silex Systems could offset risks and benefit from increased demand for Western enrichers

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.

CXW: Strong History of Contract Retention Preview 2Q24 Results

By Zacks Small Cap Research

  • We remain optimistic about CXW’s new business activities, operating improvements and cost containment efforts.
  • Over time, we expect occupancies at CXW facilities to continue to increase, the pending ICE termination of services at CXW’s South Texas Family Residential Center notwithstanding, as ICE & multiple government entities seek capacity.
  • CXW also continues to strengthen its balance sheet, with a 2Q24 debt offering concurrent with a tender offer for 2026 8.25% notes.

The Return of La Niña // CTA Positioning Update

By The Commodity Report

  • CTA Positioning Update The latest CTA picture by UBS shows that managed money is currently maxed long coffee and oil and max short corn, soybeans cotton and lean hogs.
  • The contrarian ideas would speculate on the exact opposite of this positioning. On the other hand, the data currently suggests only slight changes in the current positioning.
  • On the other hand, the data currently suggests only slight changes in the current positioning.

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Jul 23
0

Daily Brief China: Canvest Environmental Protection Group, Sunny Optical Technology Group, China National Nuclear Power C, Bloks Group, Saint Bella, Sino-Ocean Group and more

By | China, Daily Briefs

In today’s briefing:

  • Canvest Environmental (1381 HK): Grandblue’s Pre-Condition Privatisation at HK$4.90
  • BUY/SELL/HOLD: Hong Kong Stock Updates (July 22)
  • China A50 ETFs Rebalance Preview: Two Changes in September
  • Bloks Group Pre-IPO – The Positives – Wide Portfolio of Established IPs
  • Bloks Group Pre-IPO – The Negatives – Concentration Risk Is Concerning, and Limited Overseas Reach
  • Pre-IPO Saint Bella – The Outlook for Future Performance Growth Is Highly Uncertain
  • Morning Views Asia: Powerlong Commercial Management Holdings, Reliance Industries, Sino-Ocean Service

Canvest Environmental (1381 HK): Grandblue’s Pre-Condition Privatisation at HK$4.90

By Arun George

  • Canvest Environmental Protection Group (1381 HK) disclosed a pre-conditional Cayman scheme privatisation from Grandblue Environment Co A (600323 CH) at HK$4.90 per share, an 11.6% premium to the last close price.
  • The precondition relates to the completion of capital injection into the offeror, Grandblue shareholder, and regulatory approvals. The heavy presence of SOE entities makes this a formality.
  • While not a knockout bid, the offer (which is final) is reasonable. Shareholders with blocking stakes will be supportive. Timing is the key risk as the offer is long-dated.

BUY/SELL/HOLD: Hong Kong Stock Updates (July 22)

By David Mudd

China A50 ETFs Rebalance Preview: Two Changes in September

By Brian Freitas

Bloks Group Pre-IPO – The Positives – Wide Portfolio of Established IPs

By Clarence Chu

  • Bloks Group (1850960D CH) is looking to raise US$300m in its upcoming Hong Kong IPO.
  • Bloks Groups (Bloks) operates in the toy segment where it primarily assembles character and brick-based toys.
  • In this note, we will talk about the positive aspects of the deal.

Bloks Group Pre-IPO – The Negatives – Concentration Risk Is Concerning, and Limited Overseas Reach

By Clarence Chu

  • Bloks Group (1850960D CH) is looking to raise US$300m in its upcoming Hong Kong IPO.
  • Bloks Groups (Bloks) operates in the toy segment where it primarily assembles character and brick-based toys.
  • In this note, we will talk about the not so positive aspects of the deal.

Pre-IPO Saint Bella – The Outlook for Future Performance Growth Is Highly Uncertain

By Xinyao (Criss) Wang

  • SAINT BELLA’s revenue growth fluctuated because the pandemic led to the delay in the pregnancy plan of many families and an increase in the rate of abortion or miscarriage. 
  • The increasing contract liabilities indicate that short-term performance growth of SAINT BELLA is guaranteed, but the declining fertility rates in China will bring challenges to SAINT BELLA’s long-term growth momentum.
  • After Series B round financing in 2020, post-investment valuation was already about US$100 million. Valuation of SAINT BELLA should be higher than Aidigong Maternal & Child Health Limited (286 HK).

Morning Views Asia: Powerlong Commercial Management Holdings, Reliance Industries, Sino-Ocean Service

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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Jul 23
0

Daily Brief Japan: ASICS Corp, Fancl Corp, Nippon Yusen Kk, Sun Corp, Temairazu, Inc. and more

By | Daily Briefs, Japan

In today’s briefing:

  • ASICS (7936 JP): The Current Playbook
  • Fancl (4921 JP): Evaluating the Potential of Kirin (2503 JP) Offer Bump
  • Nippon Yusen (9101) – Guidance Revision Up Still Conservative, Means More Capital Return Eventually
  • True Wind Raises Partial TOB Price for Sun Corp (6736 JP) By 8%. Not Enough.
  • Temairazu (2477 JP) – Monday, Apr 22, 2024

ASICS (7936 JP): The Current Playbook

By Arun George

  • Since the US$1.4 billion secondary placement announcement, ASICS Corp (7936 JP)’s shares are up 0.9% from the undisturbed price of JPY2,564 per share (12 July).
  • Looking at recent large Japanese placements is instructive to understand the potential trading pattern. So far, Asics’ shares have deviated from the pattern of previous large placements.
  • The offering will likely be priced on 23 July. Investors who have participated in previous large Japanese placements tend to secure positive returns.

Fancl (4921 JP): Evaluating the Potential of Kirin (2503 JP) Offer Bump

By Arun George

  • Kirin Holdings (2503 JP)’s JPY8,620 offer for Fancl Corp (4921 JP) closes on 29 July. The shares have traded above terms for 25 out of the 26 trading days.
  • MY.Alpha Management has amassed 10.3 million shares (8.51% ownership ratio) with several purchases above terms. MY.Alpha could catalyse other shareholders to rally against a light offer. 
  • The emergence of MY.Alpha, the high volume above terms, peers re-rating, the required minority acceptance rate, and an offer unattractive to historical trading ranges increase the probability of a bump. 

Nippon Yusen (9101) – Guidance Revision Up Still Conservative, Means More Capital Return Eventually

By Travis Lundy

  • Nippon Yusen Kk (9101 JP) today announced an upward revision of H1 and full-year guidance. It was a dramatic increase.
  • The breakdown of the OP and RP numbers suggests a huge gain in containers in Q1 and into Q2. The breakdown of revenue and OP changes suggested substantial H2 conservatism.
  • On a capital-adjusted basis, Nippon Yusen is now slightly cheap vs its domestic peers and has shown a willingness to spend its excess cash on buybacks. Expect more.

True Wind Raises Partial TOB Price for Sun Corp (6736 JP) By 8%. Not Enough.

By Travis Lundy

  • Today, the final day of the Tender Offer that True Wind Capital launched on 10 June 2024 to buy 19% of Sun Corp (6736 JP), TWC raised its price to ¥4,750/share./
  • They also lowered their minimum from 3.7934mm shares (17.0%) to 3.3472mm shares (15.0%).
  • As Cellebrite DI (CLBT US) had traded higher, SunCorp had too, and even though shares fell today, they are at ¥4,785/share.

Temairazu (2477 JP) – Monday, Apr 22, 2024

By Value Investors Club

  • Temairazu is a high-quality vertical SaaS company in Japan with impressive EBIT growth rates, presenting as an undervalued investment opportunity
  • Japan’s software sector is flourishing with a higher number of listed companies compared to Western markets, offering fertile ground for small-cap opportunities like Temairazu
  • With upcoming improvements in shareholder returns and a competitive landscape in sectors like accounting software, Temairazu has the potential to be a Japanese hidden gem for prospective investors

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.

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Jul 23
0

Daily Brief Thematic (Sector/Industry): The Impact of the US Biosecure Act on India’s Pharma Export Market and more

By | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

  • The Impact of the US Biosecure Act on India’s Pharma Export Market
  • Earnings: TSMC, AEHR, ASML, VAT Group, Export Restrictions
  • Ohayo Japan | S&P 500 Surges in Tech-Led Rally
  • Union Budget 2024 Expectations: The Modi 3.0 Era and Its Impact on India’s Economic Growth
  • Mapping Indian Market Performance Around Past 10 Budgets
  • Japan Morning Connection – 22 July, 2024
  • Biopharma Week in Review – Jul 22, 2024
  • The Highlights – Cannabis News for the Week Ending July 19, 2024
  • Furniture/Furnishings Weekly – Another Good Week for Stocks

The Impact of the US Biosecure Act on India’s Pharma Export Market

By Nimish Maheshwari

  • The US Biosecure Act may restrict federal sourcing from China, boosting India’s pharmaceutical manufacturing.
  • India’s CDMO market is expected to double in three years, significantly enhancing global competitiveness.
  • Strategic investments in India’s pharmaceutical sector now appear more promising and potentially lucrative.

Earnings: TSMC, AEHR, ASML, VAT Group, Export Restrictions

By Douglas O’Laughlin

  • Aehr had a messy print, with the core business actually weaker than expected as they incorporated their recent acquisition. It’s hard to stay bearish, as they have a lot of potential product launches coming.

  • TSMC beat gross margins despite everything because of higher utilization. The logic cycle is starting to kick off in earnest. I believe WFE Capex will be much higher next year.

  • ASML talked up high-NA DRAM insertion on 25/26. Only Samsung could do it. Good luck, Samsung!

Ohayo Japan | S&P 500 Surges in Tech-Led Rally

By Mark Chadwick

  • Nvidia led the tech recovery, surging 4.8%, with Meta and Alphabet also posting strong gains.
  • Goodyear Tire & Rubber is selling its off-the-road equipment tire business to Yokohama Rubber for $905 million
  • Mitsubishi Heavy Industries has contracted with Airbus to supply emergency doors for A321neo planes, diversifying from its reliance on Boeing

Union Budget 2024 Expectations: The Modi 3.0 Era and Its Impact on India’s Economic Growth

By Nimish Maheshwari

  • The Union Budget 2024 expectations: Focuse on job creation, rural support, and domestic manufacturing, aiming to drive economic growth and self-reliance.
  • Employment, housing and Manufacturing will be the key priorities for Modi 3.O.
  • This Budget can see some Taxation benefits for middle-class salaried individuals by offering improved tax incentives and a simpler tax system.

Mapping Indian Market Performance Around Past 10 Budgets

By Sudarshan Bhandari

  • FM Nirmala Sitharaman prepares to unveil the Union Budget for the fiscal year 2024-25 on July 23rd.
  • Movement of Sensex and Nifty around the Budget day and post that.
  • What sectors performed best and worst during the last 10 budget days?

Japan Morning Connection – 22 July, 2024

By Andrew Jackson

  • Markets fell with Russell -0.63%, SPX -0.71%, Nasdaq -0.93% and SOX -3.11%. UST10 rose 0.88% and the yen weakened to Y157.48. Commodoties fell.
  • CRWD -11.1%, MSFT -0.74%, and power semis (Wolfspeed -7.17%) fell due to a CrowdStrike IT outage and Trump-related EV concerns respectively, showing sector vulnerability.
  • Stocks with China exposure fell sharply due to US export restrictions, with Disco -23.1%, TEL -18.1%, Screen -17.8%. Intuitive Surgical surged on strong Q2 results and da Vinci 5 launch.

Biopharma Week in Review – Jul 22, 2024

By Water Tower Research

  • We review last week’s biopharma news for meaningful clinical data, regulatory updates, research innovation, and M&A.
  • Roche Holding Ltd. (RHHBY) reported initial Phase 1 data for oral GLP-1R agonist CT-996 in obesity patients, showing a 6.1% placebo-adjusted weight loss (p<0.001) at four weeks.
  • While the weight loss compares favorably with approved injectables at four weeks (1-3% adjusted), the lack of details in the CT996 data, like baseline body weight, limits any cross-trial comparison. 

The Highlights – Cannabis News for the Week Ending July 19, 2024

By Water Tower Research

  • Cannabis stocks started strong last week but faded on Friday. MSOS dropped 2.50% over the five sessions, while YOLO fell 1.73%.
  • Ascend (CSE: AAWH, OTCQX: AAWH) rallied 12.18% following its debt refinancing, while Jushi (CSE: JUSH, OTCQX: JUSHF) lost the most at -9.84%.
  • Ascend (CSE: AAWH, OTCQX: AAWH) announced on Monday it successfully refinanced its debt.

Furniture/Furnishings Weekly – Another Good Week for Stocks

By Water Tower Research

  • Rotation into smaller-cap and value stocks continues.
  • The Water Tower Research Commercial/Contract Index (+1.2%) and Residential Manufacturers & Suppliers Index (+2.4%) benefited, while the Home Goods Retailers Index (-2.1%) was weighed down, in part, by bankruptcy concerns for CONN.
  • The Mass Retailers Index (-2.4%) was affected by weakness in growth stocks, giant caps, and technology components of the market. 

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Jul 23
0

Daily Brief ECM: ASICS (7936 JP): The Current Playbook and more

By | Daily Briefs, ECM

In today’s briefing:

  • ASICS (7936 JP): The Current Playbook
  • Bloks Group Pre-IPO – The Positives – Wide Portfolio of Established IPs
  • SAI Life Sciences Pre-IPO Tear Sheet
  • ACME Solar Holdings Pre-IPO Tearsheet
  • Bloks Group Pre-IPO – The Negatives – Concentration Risk Is Concerning, and Limited Overseas Reach
  • Pre-IPO Saint Bella – The Outlook for Future Performance Growth Is Highly Uncertain

ASICS (7936 JP): The Current Playbook

By Arun George

  • Since the US$1.4 billion secondary placement announcement, ASICS Corp (7936 JP)’s shares are up 0.9% from the undisturbed price of JPY2,564 per share (12 July).
  • Looking at recent large Japanese placements is instructive to understand the potential trading pattern. So far, Asics’ shares have deviated from the pattern of previous large placements.
  • The offering will likely be priced on 23 July. Investors who have participated in previous large Japanese placements tend to secure positive returns.

Bloks Group Pre-IPO – The Positives – Wide Portfolio of Established IPs

By Clarence Chu

  • Bloks Group (1850960D CH) is looking to raise US$300m in its upcoming Hong Kong IPO.
  • Bloks Groups (Bloks) operates in the toy segment where it primarily assembles character and brick-based toys.
  • In this note, we will talk about the positive aspects of the deal.

SAI Life Sciences Pre-IPO Tear Sheet

By Tina Banerjee

  • SAI Life Sciences (SAILS12 IN) is planning to raise INR50B, consisting of INR8B worth of fresh issue and the rest will be OFS. 
  • Out of the proceeds from fresh issue, the company intends to utilize INR6B for repayment/pre-payment, in full or part, of all or certain outstanding borrowings availed by the company.
  • Sai Life Sciences is the fastest-growing Indian CRDMOs among listed Indian peers in terms of revenue as well as EBITDA CAGR during FY22–24.

ACME Solar Holdings Pre-IPO Tearsheet

By Clarence Chu

  • ACME Solar Holdings (1700918D IN) is looking to raise US$360m in its upcoming India IPO. The bookrunners on the deal are ICICI, JM Financial, Kotak, Nuvama Wealth and Motilal Oswal.
  • ACME Solar (ACME) is a renewable energy firm with a portfolio of solar, wind, hybrid and firm and dispatchable renewable energy (FDRE) projects.
  • As per CRISIL, the firm was among the top 10 renewable energy players in India in terms of operational capacity as of FY24. 

Bloks Group Pre-IPO – The Negatives – Concentration Risk Is Concerning, and Limited Overseas Reach

By Clarence Chu

  • Bloks Group (1850960D CH) is looking to raise US$300m in its upcoming Hong Kong IPO.
  • Bloks Groups (Bloks) operates in the toy segment where it primarily assembles character and brick-based toys.
  • In this note, we will talk about the not so positive aspects of the deal.

Pre-IPO Saint Bella – The Outlook for Future Performance Growth Is Highly Uncertain

By Xinyao (Criss) Wang

  • SAINT BELLA’s revenue growth fluctuated because the pandemic led to the delay in the pregnancy plan of many families and an increase in the rate of abortion or miscarriage. 
  • The increasing contract liabilities indicate that short-term performance growth of SAINT BELLA is guaranteed, but the declining fertility rates in China will bring challenges to SAINT BELLA’s long-term growth momentum.
  • After Series B round financing in 2020, post-investment valuation was already about US$100 million. Valuation of SAINT BELLA should be higher than Aidigong Maternal & Child Health Limited (286 HK).

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  • ✓ Personalised Alerts
  • ✓ Custom Watchlists
  • ✓ Company Data and News
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Jul 23
0

Daily Brief Event-Driven: KRX’s Plan to Integrate KOSPI & KOSDAQ into a Tiered System: Trading Considerations and more

By | Daily Briefs, Event-Driven

In today’s briefing:

  • KRX’s Plan to Integrate KOSPI & KOSDAQ into a Tiered System: Trading Considerations
  • Fancl (4921 JP): Evaluating the Potential of Kirin (2503 JP) Offer Bump
  • Kakao’s Kim Beom-Su Arrested: Analyzing Its Impact on Related Companies
  • True Wind Raises Partial TOB Price for Sun Corp (6736 JP) By 8%. Not Enough.
  • Canvest Environmental (1381 HK): Grandblue’s Pre-Condition Privatisation at HK$4.90
  • Robotics+Bobcat Merger: Merger Ratio Revision Possibility & Arb Spread Recalculations
  • The Warehouse Group (WHS NZ): Tindall (Potentially) Reloads
  • NIFTY50 Index Rebalance Preview: Big Flow, Big Impact, Big Positioning
  • Block Deal Sale of Kumho Tire: More Shares Likely to Be Sold by Creditors
  • China A50 ETFs Rebalance Preview: Two Changes in September

KRX’s Plan to Integrate KOSPI & KOSDAQ into a Tiered System: Trading Considerations

By Sanghyun Park

  • The major framework of this realignment is likely decided, integrating KOSPI and KOSDAQ into a tiered system based on liquidity, market cap, and financial status, with periodic replacements.
  • The KOSPI 200’s continued existence is uncertain under the new realignment plan, which may shift its role to the value-up index, resembling Japan’s market restructuring model.
  • The first-tier market’s entry requirements will likely reflect value-up index criteria, suggesting greater speculative money movement toward the value-up index starting in September.

Fancl (4921 JP): Evaluating the Potential of Kirin (2503 JP) Offer Bump

By Arun George

  • Kirin Holdings (2503 JP)’s JPY8,620 offer for Fancl Corp (4921 JP) closes on 29 July. The shares have traded above terms for 25 out of the 26 trading days.
  • MY.Alpha Management has amassed 10.3 million shares (8.51% ownership ratio) with several purchases above terms. MY.Alpha could catalyse other shareholders to rally against a light offer. 
  • The emergence of MY.Alpha, the high volume above terms, peers re-rating, the required minority acceptance rate, and an offer unattractive to historical trading ranges increase the probability of a bump. 

Kakao’s Kim Beom-Su Arrested: Analyzing Its Impact on Related Companies

By Sanghyun Park

  • Kakao’s Kim Beom-su has been arrested over alleged stock price manipulation in the SM Entertainment buyout, marking a new peak in the company’s legal troubles.
  • Kakao Corp’s stock might drop due to the absence of a key figure. KakaoBank could also struggle from uncertainty about its largest shareholder and weakened business ties.
  • Kakao’s potential sale of SM Entertainment shares could initially hurt the stock price, but potential bidding interest might boost it.

True Wind Raises Partial TOB Price for Sun Corp (6736 JP) By 8%. Not Enough.

By Travis Lundy

  • Today, the final day of the Tender Offer that True Wind Capital launched on 10 June 2024 to buy 19% of Sun Corp (6736 JP), TWC raised its price to ¥4,750/share./
  • They also lowered their minimum from 3.7934mm shares (17.0%) to 3.3472mm shares (15.0%).
  • As Cellebrite DI (CLBT US) had traded higher, SunCorp had too, and even though shares fell today, they are at ¥4,785/share.

Canvest Environmental (1381 HK): Grandblue’s Pre-Condition Privatisation at HK$4.90

By Arun George

  • Canvest Environmental Protection Group (1381 HK) disclosed a pre-conditional Cayman scheme privatisation from Grandblue Environment Co A (600323 CH) at HK$4.90 per share, an 11.6% premium to the last close price.
  • The precondition relates to the completion of capital injection into the offeror, Grandblue shareholder, and regulatory approvals. The heavy presence of SOE entities makes this a formality.
  • While not a knockout bid, the offer (which is final) is reasonable. Shareholders with blocking stakes will be supportive. Timing is the key risk as the offer is long-dated.

Robotics+Bobcat Merger: Merger Ratio Revision Possibility & Arb Spread Recalculations

By Sanghyun Park

  • During Kim Byung-hwan’s hearing, he acknowledged market concerns about the Doosan merger, increasing skepticism about Doosan’s ability to maintain the original merger ratio.
  • Calculating Bobcat’s net asset value using the net asset value method yields approximately ₩6.1T, derived from ₩5.95T in year-end equity plus ₩0.13T in adjustments.
  • Reassess arb trading opportunities; with no short hedge for Robotics, consider an outright long position in Bobcat if its swap price is revised and the spread widens.

The Warehouse Group (WHS NZ): Tindall (Potentially) Reloads

By David Blennerhassett

  • General merchandise retailer Warehouse Group Limited (WHS NZ) (TWG) has announced it has received an approach from Stephen Tindall and PE outfit, Adamantem Capital Partners
  • Founder and major shareholder Tindall holds a shade over 50%. He launched a $1.6bn privatisation attempt in 2006, but Foodstuffs and Woolworths Ltd (WOW AU) effectively blocked the Offer.
  • The approach arrives after TWG’s shares trade around multi-year lows. 

NIFTY50 Index Rebalance Preview: Big Flow, Big Impact, Big Positioning

By Brian Freitas

Block Deal Sale of Kumho Tire: More Shares Likely to Be Sold by Creditors

By Douglas Kim

  • Woori Bank completed a block deal sale of 11 million shares of Kumho Tire Co (073240 KS) (3.83% of outstanding shares) on 18 July. 
  • After the recent sales by Woori Bank and the Export-Import Bank of Korea, the creditors’ stakes in Kumho Tire has been reduced to 19.17%.
  • Despite Kumho Tire’s recent improvement in financial performance, we are more concerned about the additional stake sale by the financial institutions that still own 19.2% stake in the company. 

China A50 ETFs Rebalance Preview: Two Changes in September

By Brian Freitas

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Jul 23
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Daily Brief Credit: Morning Views Asia: Powerlong Commercial Management Holdings and more

By | Credit, Daily Briefs

In today’s briefing:

  • Morning Views Asia: Powerlong Commercial Management Holdings, Reliance Industries, Sino-Ocean Service

Morning Views Asia: Powerlong Commercial Management Holdings, Reliance Industries, Sino-Ocean Service

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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Jul 23
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Daily Brief Equity Bottom-Up: Nippon Yusen (9101) – Guidance Revision Up Still Conservative and more

By | Daily Briefs, Equity Bottom-Up

In today’s briefing:

  • Nippon Yusen (9101) – Guidance Revision Up Still Conservative, Means More Capital Return Eventually
  • BUY/SELL/HOLD: Hong Kong Stock Updates (July 22)
  • [Q2 Earnings Preview] Microsoft Flying High on Tailwinds from Azure Surge, AI Leap & Gaming Boost
  • Thai Beverage (THBEV SP) – Increasingly Streamlined SEA F&B Play
  • Ryanair – FY25 Weakness Suggests a “normalization” and Prompts Structural Industry Questions
  • TechChain Insights: Call with Silicon Motion; QLC NAND Emerging as Key Enabler for AI Devices
  • Buyback and director filings taper off during pre-earnings period
  • Actinver Research – Housing Sector : Building a More Profitable Future (Sector Update)
  • Mongolian Mining (975 HK): Q2 2024 Production Impressive, Good Set Up for H1
  • Oneness Biotech (4743 TT): Marketing Progress of Fespixon in China Opens a New Revenue Stream

Nippon Yusen (9101) – Guidance Revision Up Still Conservative, Means More Capital Return Eventually

By Travis Lundy

  • Nippon Yusen Kk (9101 JP) today announced an upward revision of H1 and full-year guidance. It was a dramatic increase.
  • The breakdown of the OP and RP numbers suggests a huge gain in containers in Q1 and into Q2. The breakdown of revenue and OP changes suggested substantial H2 conservatism.
  • On a capital-adjusted basis, Nippon Yusen is now slightly cheap vs its domestic peers and has shown a willingness to spend its excess cash on buybacks. Expect more.

BUY/SELL/HOLD: Hong Kong Stock Updates (July 22)

By David Mudd

[Q2 Earnings Preview] Microsoft Flying High on Tailwinds from Azure Surge, AI Leap & Gaming Boost

By Uttkarsh Kohli

  • Azure Revenue Growth: Microsoft’s Azure revenue soared 21% YoY to $26.7B in Q3 2024, driven by advanced AI capabilities and increased enterprise adoption.
  • AI & Personal Computing: AI-driven Copilot+ PCs and hybrid AI solutions are reshaping the market, with AI-capable PC shipments projected to rise from 19% in 2024 to 60% by 2027.
  • Gaming + Activision: The $68.7B Activision acquisition boosted gaming revenue by 51% YoY, with Game Pass subscribers exceeding 30M and expanding Microsoft’s position in cloud gaming.

Thai Beverage (THBEV SP) – Increasingly Streamlined SEA F&B Play

By Angus Mackintosh

  • Thai Beverage will offload its entire stake in Frasers Property Ltd to TCC Assets in a share swap for an increased share in Fraser And Neave streamlining its business focus.
  • The share swap values Fraser And Neave on a par with peers which is at a significant premium to the share price but Fraser And Neave was excessively undervalued.
  • Thai Beverage deserves to trade on a higher multiple given its pure-play status and a succession of recent restructurings including Serm Suk and Oishi Holdings. 

Ryanair – FY25 Weakness Suggests a “normalization” and Prompts Structural Industry Questions

By Neil Glynn

  • Ryanair issued a stark warning on summer pricing today with 1Q25 results and we cut our FY25 net income 31% accordingly.
  • Our forecasts represent a re-set of unitary economics to pre-pandemic levels and it is difficult to plot improvement unless consolidation benefits or winter surgery help FY26.
  • Ryanair’s cost advantage has widened markedly against peers, justifying a strategy of continued market share focus as competitors face greater challenges.

TechChain Insights: Call with Silicon Motion; QLC NAND Emerging as Key Enabler for AI Devices

By Vincent Fernando, CFA

  • We had a conference call with Silicon Motion; the leading global provider of NAND flash controllers and solid-state storage solutions for the consumer, enterprise, and industrial markets.
  • We focus on how Silicon Motion is leveraging advantages of QLC NAND flash memory, which is becoming a critical memory solution for new AI servers, AI PCs, and AI mobiles
  • Maintain Structural Long rating for Silicon Motion and $102 valuation. The company is in a leading position to benefit from the rising importance of advanced memory controllers for AI applications.

Buyback and director filings taper off during pre-earnings period

By Geoff Howie

  • Share buybacks by primary-listed companies The five sessions also saw nine primary-listed companies conducted buybacks with a total consideration of S$4.5 million.
  • With this transaction, the total proportion of shares bought back under the current mandate now stands at 1.47 per cent of the issued shares (not counting treasury shares) as of the date when the share buyback resolution was passed.

Actinver Research – Housing Sector : Building a More Profitable Future (Sector Update)

By Actinver

  • The housing sector in Mexico has solid fundamentals, with attractive growth expectations for listed developers considering their healthy financial position and access to financing sources.
  • As a result, these companies are poised to capture the increased demand that the housing deficit generates during the coming years.
  • Since the start of the bankruptcy processes of the three largest housing developers (GEO, HOMEX, and URBI) in 2014, housing production has maintained a downward trend.

Mongolian Mining (975 HK): Q2 2024 Production Impressive, Good Set Up for H1

By Sameer Taneja

Oneness Biotech (4743 TT): Marketing Progress of Fespixon in China Opens a New Revenue Stream

By Tina Banerjee

  • Oneness Biotech (4743 TT) entered into an exclusive agreement with China Resources Dubl Crne Phrmctl (600062 CH) for commercialization of Fespixon in China, Hong Kong, and Macau.
  • Fespixon is approved in China as the first new drug for diabetic foot ulcer. Inclusion of the drug in NRDL is the next important milestone.
  • During 1H24, Oneness Biotech reported revenue of NT$57M, up 36% YoY. With expanding scale of operation, gross profit margin is improving (1Q24: 62.5% vs. 1Q23: 47.9%). Net loss is decreasing.

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