Equity Bottom-Up

• Spot container rates have surged, owing to conflict near Red Sea / Suez Canal
• On top of higher spot rates, imposition of new fees also boosting carrier revenue
• Evergreen’s average monthly US$ revenue increased from Q123 to Q423

• Tencent will allow Douyin to broadcast the game Honor of Kings after a four-year ban.
• Dada’s stock plunged after the company released its suspicious auditing result.
• Alibaba’s mobile office app, Dingding, has accumulated 120,000 paying users.

• Saizeriya (7581 JP) reported FY1Q24 results (September to November) last week.  Sales grew 22% yoy, and was 2% higher than company guidance.  Operating profit grew 104%.
• Operating profit for the Asia business, the key growth driver of the company, was Y3.3bn, up 56% yoy and above management guidance. 
• Overall thesis remains intact, as the Asia business performed slightly better than expectations. 

• We compile our selection of small and mid-cap names with our desired characteristics of high dividend yields, value, and margin of safety.
• Our top picks: Perfect Medical Health (1830 HK), Water Oasis (1161 HK), Taste Gourmet (8371 HK), Uchi Technologies (UCHI MK), and The Keepers Holdings (KEEPR PM).
• We recently added Plover Bay Technologies (1523 HK) to our list of companies under coverage. We believe there are some excellent near-term catalysts in the name. 

• WuXi Bio’s optimism about new orders failed to generated expected surge in its stock price. Many investors raised great doubts about the credibility and professionalism in communication of WuXi Bio.
• It’s easy/cost-effective for WuXi Bio to “adjust” order number. However, it’s more difficult to inflate revenue/cash flow. We have to wait for future financial results to know the real situation.
• XBI is essentially “a bond”.Recent surge of XBI is driven by the expectations of Fed’s rate cut + US soft landing, rather than virtual improvement of external environment.Much remains unclear.  

• Sumitomo Pharma (4506 JP) still expects FY24 revenue of ¥362 billion (down 35% YoY). This implies H2FY24 revenue of ¥209.4 billion, up 37% compared with H1FY24.
• To achieve this target, North America needs to perform strongly. H1FY24 revenue from North America has shown a progress rate of just 35% against full-year FY24 revenue guidance.
• With the absence of any strong catalyst, we expect recent rally in Sumitomo shares fueled by encouraging clinical trial result and new drug approval in China, will be short-lived.

Key points (machine generated)

• Steve Madden is considered a good investment opportunity due to its strong management team and attractive price.
• The shoe industry has faced challenges, but Steve Madden is seen to have minimal downside risk due to its solid balance sheet and reasonable valuation.
• Steve Madden’s focus on branded shoes also makes it an attractive acquisition target, and if it achieves estimated 2025 earnings of $3 per share, its stock price could potentially increase by 40%.

This article is sourced from an online content aggregator through publicly available sources and is displayed below for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

Key points (machine generated)

• Vanda Pharmaceuticals has established revenue-generating drugs and a pipeline of potential candidates in development.
• The company has a strong balance sheet with ample cash reserves, offering potential for investments or acquisitions.
• Despite these positive traits, the market values Vanda as if its core business is worthless, presenting a potential investment opportunity with significant upside potential.

This article is sourced from an online content aggregator through publicly available sources and is displayed below for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• Accrelist chairman Terence Tea increases stake in firm CapitaLand Investment led the consideration tally, buying back 1,072,100 shares at an average price of S$3.00 per share on Jan 10.
• Between Jan 4 and 9, Accrelist executive chairman and managing director Terence Tea acquired 2,365,900 shares at S$0.039 per share.

• Q423 revenues amounted to NT$625,529. In US$ terms, using TSMC’s projected exchange rate of 32, this translates to  $19.55 billion, a ~13% increase QoQ, and a 2% decrease YoY.
• FY 2023 revenues amounted to NT$2,161.74 billion, down 4.5% YoY. In US$ terms, this amounted to $69.1 billion, an 8.8% decrease YoY and the first such YoY decrease since 2009
• While we foresee Q124 revenues being down 5-10% QoQ, we expect full year 2024 revenues to grow in the range of 5-10% YoY. 

• Parent Genting  Berhad Malaysia flagship properties doing well but many  of its global holdings spur questions about asset allocation strategy.
• Genting Singapore, its integrated resort property Sentosa presents a strong buy story not only because it is  undervalued here but because its prospects post covid  are strong.
• GB’s US footprint by  contrast poses questions  about the  hurdle rate of those huge investments to date given the intense competitive pressures in  mature gaming  markets.

• Reuters reported on the Friday that the European Commission is to accept concessions of four European route divestitures and the sale of Asiana’s cargo business.
• The EC had set a preliminary decision deadline of 14 February.
• US and Japanese approvals are still required, while it remains to be seen who might acquire Asiana Cargo.

• The entire R&D cycle involves multi-party cooperation, leveraging one’s strengths. So, it is not difficult to understand some of the choices made by domestic pharmaceutical companies (e.g. Innovent, BeiGene).
• Due to outdated technology, investment value of Sirnaomics is low, which means the likelihood of the company being acquired is also not high. We remain conservative about the outlook. 
• ImmuneOnco’s stock price has performed much better-than-expected after IPO on HKEX. However, the endgame of ImmuneOnco’s market value could be only about RMB1.5 billion, which means large potential downside ahead.

• Like them or despise them. But one thing you can’t do is ignore them. The Super Sevens have become a force to reckon with.
• Super Sevens appear homogenous but exhibit heterogeneity and diversity. They have growth stock like features while at the same time provide value stock like defensiveness.
• Super Sevens aggregate market cap is a staggering USD 12.14 trillion. They comprise 27% of S&P 500 and 55% of the Nasdaq 100 index collectively.

• Results flash: Q4 sales +42%; Adjusted EBITDA at record high of 1.2 billion yen
• Key focus remains Business SaaS where sales rose +52% YoY to 5.5 billion
• Business earnings driven by acquisition of medium-sized corporates (+40% YoY) and higher ARPU (+22% YoY)

Key points (machine generated)

• Diageo, a top-performing business, is currently presenting a buying opportunity due to near-term fear.
• The company’s low multiples on normalized earnings power suggest a conservative base case of a 90% increase over the next five years.
• As fear diminishes, there is potential for a front-loaded Internal Rate of Return (IRR), and a bull case that could see shares rise 2.3 times or more. Overall, Diageo offers excellent intrinsic value and a low-risk investment opportunity.

This article is sourced from an online content aggregator through publicly available sources and is displayed below for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• We are most ahead of consensus for IAG in 2024, and recognising Lufthansa’s highest-in-group double-digit capacity growth rate in 2024 may render its earnings most difficult to forecast/vulnerable to disappointment.
• For AF-KLM 2024 seems a crucial year to demonstrate it can grow earnings in more challenging conditions if it is to increase confidence it can reach near-€4bn EBIT by 2028.
• Delta reports 2023 results today, and its outlook commentary will be important to frame 1Q24 prospects on the Transatlantic, which should encourage that 2024 will prove resilient.

• Since my previous insight on WH Group (288 HK) in October 2023, the stock is up 17%, massively outperforming the Hang Seng Index (HSI INDEX).
• The company is still trading at 6x forward PE, compared to an average forward PE of 11x since 2016. 
• With the US business recovering as well as its potential IPO, and a stable China business, the stock remains a buy with limited downside. 

Key points (machine generated)

• Rainbow Children’s Medicare operates a hub hospital with multiple spoke hospitals in various locations, allowing them to serve a wide geographical area and reach a larger patient base.
• The company has a strong financial performance, with profitable growth and operating cash.
• Rainbow Children’s Medicare aims to address the underserved niche pediatric market in India and capitalize on the country’s large adolescent population, presenting significant growth potential. They plan to expand their operational bed capacity by 40% by 2026.

This article is sourced from an online content aggregator through publicly available sources and is displayed below for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• JD.com, Inc. managed to surpass the revenue and earnings expectations of Wall Street.
• The company broadened its free shipping reach in the third quarter by leveraging enhanced logistics capabilities.
• The company strategically reduced the minimum order value for free shipping services, granting JD Plus members unlimited free shipping for 1P products.

• Nutanix, Inc. exceeded Wall Street’s revenue and earnings expectations, surpassing anticipated results despite a persistent uncertain macro backdrop.
• Exceeding guided metrics, Nutanix achieved significant quarterly revenue of $511 million, marking an annualized run rate surpassing $2 billion for the first time and an impressive 30% year-over-year growth in ARR to $1.7 billion.
• Nutanix announced crucial enhancements to the Cloud platform, fortifying its capabilities against ransomware attacks on unstructured data.

• Micron Technology, Inc. exceeded analyst expectations in terms of revenue as well as earnings.
• Although the expectation for 2024 remains relatively consistent, there has been an adjustment in the perspective on DRAM demand growth for 2023.
• In summary, Micron’s management emphasizes a positive trajectory for pricing and financial performance in 2024, attributing it to oversubscription in cutting-edge technologies.

Key points (machine generated)

• Arcosa is a high-quality equity investment benefiting from secular trends and government spending, with underappreciated secondary businesses experiencing rapid growth.
• The IRA tax credits are expected to act as a significant catalyst for Arcosa, pushing its numbers higher than anticipated.
• Despite its strong balance sheet, excellent management, and successful capital allocation history, Arcosa has zero hedge fund ownership, making it an attractive opportunity.

This article is sourced from an online content aggregator through publicly available sources and is displayed below for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• NEV sales volume grew by 47% YoY in December 2023 and 36% in 2023.
• BYD’s sale volume grew by 62%, higher than the industry average, 36%, in 2023.
• All NEV stocks plunged, but we still believe BYD has an upside of 61%.

• We expect BABA to report CY4Q23 top-line, adjusted EBITA and non-GAAP net income (3.2%), (7.1%) and (3.0%) vs. consensus. 
• We estimate Taobao/Tmall GMV grew 2.4%, but was offset by lower take-rate, we expect;
• BABA’s “Return to Taobao” strategy tilts traffic to low-priced Taobao products to fight PDD for low-priced mindset.

• Fast Retailing (9983 JP) announced its 1QFY24 results today, surpassing the consensus OP estimate by approximately 7%.
• Notably, Uniqlo International demonstrated robust growth, even from regions (North America & Europe) that were anticipated to underperform in this quarter. 
• The domestic business OP also managed to top consensus expectations as they managed to improve the gross margin by 2.7% YoY.

• We had thought that Fast Retailing may just miss Q1 numbers due to the warm weather; it beat on strong November and 270bps improvement in gross margin. 
• Following the slightly better results, we maintain our sales forecast at 3.1 trillion yen, but revise our operating profit estimate from 439 billion yen to 455 billion yen.
• Overall, we do not think the market will be overly surprised by the results and we maintain our view that the stock is over priced.

• Polycab India (POLYCAB IN) is in the limelight on the back of Income Tax investigation carried in December 2023 which revealed several accounted transactions.
• In a circular, it is hinted that the IT department has detected unaccounted cash sales worth INR 10 bn, unaccounted cash payments made by distributors, and some non-genuine expenses.
• However our forensics framework does not hint at any alarming red flags, apart from low FA turnover ratio, stock with third parties and board composition.

• The local media have started to provide some concrete figures of the amount of losses related to HSCEI related ELS products sold by major Korean banks and securities firms.
• If HSCEI continues to remain at about 5,450 to the end of March 2024, the total losses could rise to nearly 1.6 trillion won, impacting more than 45,000 investors. 
• Concerns about HSCEI index related ELS losses have negatively impacted both the major Korean banks and securities companies in Korea in the past 1-2 months. 

• Taiwan High Speed Rail (2633 TT) (THSR) solid traffic growth and high utilization rate are driving strong profits and cashflows which will be mostly paid out as dividends       
• We view THSR as a government-backed perpetual bond masked as equity as it has a minimum profit guarantee, a firm dividend mandate, and impetus to disperse excess cash to shareholders 
• The current yield margin against the 10-year bond is the widest since its IPO and is forecasted to widen further with strong profit growth. Attractive for alternative fixed-income investors 

• The UK Post Office “Horizon Scandal” has blown up, putting Fujitsu’s computer system failure on the front pages and on the agenda of Parliament and Prime Minister Sunak.
• Fujitsu UK has been awarded £6.8bn in public contracts since 2012. The Justice Secretary is  now talking about compensation for the enormous financial and personal damage caused.
• Fujitsu’s share price is coming off a new all-time high reached in December. The amount of compensation and loss of potential future contracts is substantial but uncertain.

Key points (machine generated)

• FLEX is undergoing a strategic shift towards higher-margin markets, which is expected to improve its operating margins and free cash flow.
• The potential spin-off of NEXTracker gives FLEX an opportunity to repurchase shares and enhance shareholder value.
• FLEX’s outstanding shares are expected to further increase shareholder value.

This article is sourced from an online content aggregator through publicly available sources and is displayed below for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• Taiwan PC names have been the top losers over the recent period, after having previously been the top winners. Our Long Dell vs. Short Acer trade is doing well.
• Nanya Tech was a top loser, falling along with its international Memory peers. Nevertheless, we note it underperformed Micron and SK Hynix. We continue to prefer SK Hynix for Memory.
• CES is happening now and will be wrapping up Friday. We like our Dell vs. Taiwan PC names through the CES event. TSMC will be reporting results January 18th.

• Back in June 2017, Toray Industries (3402 JP) acquired a 28.03% stake in Pacific Textiles (1382 HK) (@ HK$10/share). Rumours that Toray would take this stake to 50% never unfolded.
• Pacific Textiles is currently trading at HK$1.30/share, its lowest level outside of the GFC. 
• Relatively inexpensive, high digit yield and M&A angle, Pacific Textiles remains attractive. This is supported by the recent Offer for Weiqiao (2698 HK) and David Webb taking a 5% stake. 

• We forecast EBITDAR of KRW3.35trn for Korean Air in 2023 (KRW3.8trn previously) with EBITDAR/ATK up 50% on 2019/32% on 2018. We remain at KRW2.9trn in 2024 (EBITDAR/ATK +28% vs 2019).
• Unwinding cargo yields may fully eliminate earnings gains but cost management safeguards future prospects despite Asiana merger uncertainty.
• Cost inflation management inflected negatively in 3Q as labour costs rose – control crucial as market conditions normalize and low cost competitors expand.

• Xtep International (1368 HK) announced an operational update for 4Q23, with retail sales growing more than 30% for the Xtep brand (off of a low base in 4Q22).
• The overall quality of the retail sales growth is low, as the growth was mainly driven by higher discount level (around 30% compared to 25-30% in the previous quarter). 
• I still prefer Anta over Xtep at this stage, as Xtep is more of a beta play if the consumer sentiment turns around in China. 

• LG Energy Solution reported disappointing preliminary earnings in 4Q 2023. The company reported operating profit of 338.2 billion won (43.5% lower than consensus).
• Post a major earnings miss for LGES in 4Q 2023, the consensus is likely to reduce earnings estimates of the company in 2024 and 2025.
• Major EV players such as Tesla were reducing prices in the past year causing higher pressures on EV battery makers such as LGES to reduce their prices as well. 

• Pro-Dex specializes in the design, development and manufacture of autoclavable, battery-powered and electric, multi-function surgical drivers and shavers used primarily in the orthopedic, thoracic, and maxocranial facial markets. 
• Pro-dex has patented adaptive torque-limiting software and proprietary sealing solutions which appeals to their customers, primarily medical device distributors
• They also manufacture and sell rotary air motors to a wide range of industries.

• Overview: arara primarily serves retailers such as supermarkets and restaurant chains, offering Dokuji Pay (branded currency payment + marketing) and high-speed e-mail delivery software as a service.
• With its Dokuji Pay service, where clients are the issuers, the company has a certain level of distinction from its competitors in this niche field, and is solidifying its market position.
• Starting in March 2024, the company plans to integrate its digital signage- related business as well, aiming to quickly accelerate its retail marketing platform strategy to help retail stores strengthen their connection with consumers both inside and outside their stores. 

• Hon Hai released its December revenue figures on January 5th; Revenue came in lower than any other December in recent history.
• Hon Hai’s MIH EV consortium is showcasing solutions at CES 2024 this week in Las Vegas.  In Taiwan, the Luxgen expects 9,000 customer deliveries for its ‘n7’ EV by June.
• Hon Hai is trading at less than 5x forward 2025E PE; and on a trailing basis one of the lower EV/EBITDA’s in history. Latest share drop is a buying opportunity.

• After 23H1 results were released, we have seen some positive business progress in internationalization. There has been no obvious negative news about performance. Acotec’s future prospects are still relatively optimistic.
• Contrary to solid fundamentals, Acotec’s stock price continues to decline. The sluggish stock price performance is not directly related to fundamentals, but rather to poor liquidity and unsatisfactory capital inflows.
• Stock price hasn’t bottomed yet, so investors’re not advised to rush to buy the dip.For market value management, Acotec’s management need to invest more energy/time to maximize shareholder value/investors’ returns.

• JPM generated USD 38.9B in profits for the first 9 months of 2023, or about 18% of the industry total.
• Since start of 2023, JPM has outperformed S&P by 450 bps and Invesco KBW Bank ETF by a staggering 32.47%.
• Tight financial conditions, inflation, elevated rates, & lacklustre M&A activity, will hammer Q4 bank earnings. But JPM will buck the trend.

Oryzon Genomics has announced top-line results for the Phase IIb trial (PORTICO) assessing vafidemstat in borderline personality disorder (BPD), and while the primary endpoints (Borderline Personality Disorder Checklist (BPDCL) and Clinical Global Impression – Severity Agitation/ Aggression (CGI-S A/A)) did not reach statistical significance, vafidemstat was favoured over placebo in all efficacy measures, with nominal statistical significance in two key secondary endpoints (Borderline Evaluation of Severity (BEST) and State-Trait Anger Expression Inventory 2 (STAXI-2) Trait Anger). Further, the drug was found to be safe and well-tolerated, consistent with prior studies. Management plans to conduct a detailed analysis of the trial data across the coming months and intends to request an end-of-Phase II (EoP2) meeting with the FDA in early Q224 to discuss a potential registrational Phase III programme. There are currently no approved drugs for this indication and hence gold-standard endpoints are yet to be established. We therefore believe that there is still a significant opportunity for Oryzon in this space, however, further clinical progression will be heavily reliant on the EoP2 meeting request and outcome.

• Only about 1/3 of of the recently announced share buy back is done, the remainder will come from now through end of March 2024.
• Earnings are far higher than the bank’s forecast, and there should be a major revision in coming weeks.
• Credit Saison collaboration and exiting BOJ negative rate policy, should provide a multitude of positives, for revenue growth.

• Our FY24 to March 2024 EBIT forecast for ANA of ¥ 196bn is considerably higher than company guidance of ¥ 140bn, supported by our analysis of historical earnings seasonality.
• However, we are only narrowly above consensus of ¥186bn, and narrowly below consensus of ¥204bn, ¥208bn in FY25, FY26.
• In contrast, we see considerably greater upside to expectations at JAL, where our FY24 EBIT is 27% above consensus.

• Since releasing Q3 results, Money Forward’s stock price has fallen from 4,800 yen to the present 4,000 yen.
• Results on Friday could herald a stronger outlook for the share price. The market is fixated on quarterly earnings and ad spend – these should improve sequentially.
• Money Forward will release guidance for the coming fiscal year, which could see the company turn profitable at the EBITDA level.

• Shougang Fushan Resources (639 HK) energy, a pure play on high coking coal prices, now trades at 5.7x FY24 PE (1.5x EV-EBITDA), assuming 2,200 RMB/ton prices (vs spot 2500). 
• The company has ~7.5 bn HKD of net cash (on H12023), representing 50% of the market cap despite conducting a recent buyback of 5% and paying all its outstanding dividends/taxes. 
• With an 80% payout, we can also expect a dividend yield of 14% for FY24 if prices average 2200 RMB/ton.  

• Adi Sarana Armada (ASSA IJ) represents one of the most interesting plays on people and goods mobility and end-to-end logistics in Indonesia, being market leaders in auto leasing and auctions.
• Revenues slowed in 9M2023 due to a slowdown in Anteraja because of slower e-commerce but other areas saw strong growth, especially its auction and used car business.
• Adi Sarana Armada continues to build its renamed Cargoshare end-to-end logistics business with new customers and a move into cold chain logistics. Valuations are attractive relative to growth.

• A new draft measure suggested Shenzhen is planning to accelerate its shantytown renovation and offer more Affordable Houses to meet demand of low-income groups, mimicking Singapore’s HDB flat policy.
• As China’s property market gradually heading to the Singapore model, we expect the existing home market to enlarge and new home market to shrink.
• We expect Beike existing home business and renovation business to benefit, while new home business hurts. We maintained the stock as BUY rating and TP at US$24.5/ADS.

• The upcoming earnings season, along with the forthcoming Budget and Elections, should all contribute to keeping the undertone bullish for the NIFTY Index (NIFTY INDEX). 
• Bandhan Bank Ltd (BANDHAN IN) reported a minor dip in collections for the non-EEB portfolio, which has probably spooked the street.
• Other names discussed include MMFS, POONAWAL, AUBANK, LTFH, and AAVAS.

• The upcoming Chinese New Year travel rush is expected to see air passenger volume reach 80m, a 9.8% increase vs. 2019. Tongcheng Travel Holdings (780 HK) is a key beneficiary.
• In addition to air ticket booking, Tongcheng can gain from demand for related services and products. The focus on lower-tier cities will make it better satisfy their demand. 
• Its FY24F PER of 15.2x is lower than sector average of 16.4x, yet 3-year EPS CAGR of 30.7% is higher. Its underperformance against Trip.com (TCOM US) can be reversed.

• Rain Industries is an Indian small-cap company (~$660M) that manufactures 2 carbon-based inputs for Aluminium Industry (10% of global market share).

• It also has a cement & value-added chemical business

• The Company is ignored by market likely due to its ‘commodity’ nature, debt on their balance sheet and small market cap which drives most investors away. 

• We anticipate a sluggish beginning to the fiscal year with 1Q8/24 earnings reflecting slower growth in Japan, China, and Southeast Asia.
• Our forecast for 1Q24 operating profit stands at ¥130 billion, slightly below the consensus estimate of ¥138 billion. Assuming our estimates are accurate, we anticipate a slightly negative share-price reaction.
• Our bearish stance on the stock persists, driven by the fact that it trades at a premium to our DCF and at a premium compared to global peers

• Steady and strong profit is the key features of Power Finance and this is improving during FY24.
• ROA expansion can continue to reach and possibly surpass the peaks of FY15 and FY16 with loan volume, contained costs, better credit metrics.
• Recent quarterly data shows better loan volume and financial assets expanding more than financial liabilities, with credit costs in reverse.

• Oriental Watch (398 HK)  went ex-dividend on the 4th of January and has settled at an appetizing valuation of 6.8x PE with 60% of the market cap in cash.
• The market post-golden week and into the new year has been tepid.
• We expect the company to continue paying out 100% of its profits as dividends, based on which the dividend yield is close to 14% at the current share price.

• Our conviction long Shift Inc (3697 JP) ‘s share price went up by more than 50% in 2023 driven by strong growth in top line alongside further improvement in margins.
• The company’s margins fell in 2022 due to unprofitable projects, however, as these projects came to an end and the company being careful with projects, margins began to recover.
• Shift’s share price has declined over the last few days which we think is temporary and offers an  opportunity to make an entry.  

• PDD diversified into ‘local life’ businesses in December 2023, but stopped these businesses within two weeks.
• We believe PDD’s low price advantage does not work in Meituan-like ‘local life’ and the top performer Meituan is hard to fight.
• We believe the stock price has an upside of 88% for year end 2024.

• We revisit FY24 prospects by highlighting that historical full service carrier (FSC) earnings seasonality suggests group EBIT guidance of ¥130bn is very conservative.
• FSC FY24 EBIT guidance of ¥80bn implies only ¥9bn in 2H, 12% of 1H’s ¥71bn, whereas historically 2H has represented 74-83% of 1H. We model ¥59bn or 84% in 2H.
• Our ¥176.5bn group EBIT for FY24 is 36% above guidance but also 27% above Visible Alpha consensus, largely due to lower costs, which position JAL strongly for the long-term.

• Ferrotec shares have dropped by a third since last July and are now selling at 8.2x EPS guidance and 0.6x book value.
• Sales and operating should start to recover in 2H of FY Mar-24, led by power semiconductor substrates.
• Buy for the upturn in the semiconductor cycle and capacity expansion in Japan, China and Malaysia. No significant damage from the Noto Peninsula earthquake has been reported.

• Through November 2023, Bora Pharmaceuticals (6472 TT) reported revenue of NT$13.2B, up 50% YoY. Going ahead, we are upbeat on both CDMO and pharmaceutical businesses of the company.
• Bora’s foray into branded pharmaceutical market in U.S. should add a new revenue driver and improve margins. Generic portfolio should benefit from new launches amid better pricing environment.
• Through the first nine months of 2023, Bora has added 13 new customers and 28 new products to its CDMO business. Both the numbers are way above full-year 2023 forecast.

Edison Investment Research is terminating coverage on Kinarus Therapeutics (KNRS), Numis Corporation (NUM), EMIS Group (EMIS), Pixium Vision (PIX) and Treatt (TET). Please note you should no longer rely on any previous research or estimates for this company. All forecasts should now be considered redundant. Previously published reports can still be accessed via website

Edison Investment Research is terminating coverage on Kinarus Therapeutics (KNRS), Numis Corporation (NUM), EMIS Group (EMIS), Pixium Vision (PIX) and Treatt (TET). Please note you should no longer rely on any previous research or estimates for this company. All forecasts should now be considered redundant. Previously published reports can still be accessed via website

• Alibaba is transforming into a leaner, more efficient and more profitable technology company with sharpened focus on core business and shareholder return.
• While we don’t expect growth to define the company in the near future, high single-digit P/E more than compensates for the lack of it.
• This worst-performing and cheapest technology stock among global peers stands a big chance of staging a comeback in 2024 in our view.

• Anta Sports Products (2020 HK) announced a set of in-line 4Q23 operating data. 
• In addition, the company has filed a registration statement with the U.S. SEC on January 4 for a proposed listing of Amer Sports on the New York Stock Exchange. 
• Anta currently trades at a forward PE of 17x based on estimated 2024 earnings, compared to a historical forward PE of 24x since 2017.

• TSMC: 7.7% Premium — Spread Has Fallen Further, Likely Can Short a Bit Further
• ASE: Drops to 5.1% Premium — Can Consider Going Long at Current Level Due to Maxed Headroom & ASE’s Strong Advanced Chip Packaging Story
• CHT: Trading at -0.9% Discount — Good Level to Long the Spread, Rare Discount

• Amer Sports, 52.7% owned by Anta Sports Products (2020 HK), has finally filed a US IPO registration. This is positive for Anta Sports as it can realise Amer’s value.
• Reported losses at Amer have increased YoY for 9M23 due to higher finance cost. But, its gross, operating, and adjusted EBITDA margins have all recorded solid improvements. 
• Assuming Amer is listed at the sector’s average FY23 P/S of 1.6x, Anta Sports may book deemed disposal gain of HK$13.5bn, or about 6.8% of its market capitalisation.

• Chinese NEV (new energy vehicle) producers’ deliveries grew rapidly in 2023.
• PDD closed most “local life” businesses, including hotel booking, movie ticketing, etc.
• Jack Ma is no longer the controller of AliPay, the largest online payment app.

• Riding on multiple export contracts, Caregen Co Ltd (214370 KS) was confident of achieving KRW60–100B revenue from ProGsterol in 2023. However, during 9M23, ProGsterol clocked revenue of KRW8.5B.
• ProGsterol should rebound in this year, with the resumption of registration process in each country. Direct entry in the U.S. should be the strong catalyst for ProGsterol revenue this year.
• Caregen is developing an eye drop for wet macular degeneration. This is in phase 1 trial. The compay is preparing for phase 2 trial for COVID-19 nasal spray in Israel.

• Innovent has launched head-to-head phase III clinical trial of Mazdutide and Semaglutide. If the challenge is successful, it will have milestone significance. Domestic sales of Mazdutide will look very promising.
• Innovent received negative news on CEACAM5 ADC/KRAS G12C.When independent R&D cannot be relied upon, Innovent has to seek new sources of growth to make up for the remaining sales gap.
• There’s nothing wrong with Innovent’s development strategy by balancing both success rate and efficiency, although Innovent is hard to become a leader in cutting-edge R&D. We remain optimistic on Innovent.

• The last twelve months were, market-wise, interesting. Multiple things have happened that contributed to changes in my thinking-process.
• Refining thoughts and the mental mechanism I utilize to approach portfolio management should lead to success, or at least that is my hypothesis.
• Continuous learning allows for building more solid premises. Given time, compound interest sharpens them to the point where chances of error are minimum.

• The share price has increased by around 20% since mid-last year.
• A new revenue stream from the booking fee through the Zig app and calls that, albeit small, it was never possible to share upside with cabbies before. 
• Extension from 15 days to 30 days visa-free for Chinese tourists to come to Singapore on early 2024. 

• Human services company Millennium Services Group Ltd (ASX:MIL) has entered a Scheme of Arrangement with an entity associated with Softbank Robotics Singapore for the acquisition of 100% of shares at $1.15/share cash.
• Shareholders also have the option to accept a mix of cash and scrip in the new unlisted entity, with certain management committing not less than a total of 30% for this option.
• The bid price represents an 89% premium to the last RaaS update note (October 23) and 360% premium from July 1, 2023. 

• 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

• 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 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.

• 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.

• 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. 

• 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.

• PT Metrodata Electronics is Indonesia’s leading ICT distributor and one of the largest IT solutions & consulting companies, making it a play on growing digitalisation in the country.
• The company has seen strong demand from several sectors for its solutions & consulting business, most notably from banks for digital transformations, oil & gas, and telecoms 
• PT Metrodata Electronics is also seeing a strong rebound in its ICT distribution business, with its higher-margin solutions outperforming boosted by public sector growth. Valuations compelling on 8.7x FY2024E PER.

• The wafer demand outlook for 1Q24F should be around flat, but ASP (Average Selling Price) is expected to decline by negative mid-single digits.
• Compared to 4Q23, Mediatek Inc (2454 TT)‘s foundry demand is larger and Samsung Electronics (005930 KS)‘s foundry demand is downsized in 1Q24F. 
• United Microelectronics Corp (2303 TT) and Intel Corp (INTC US) are currently discussing the allocation issue of 12nm capacity.

• New China Life Insurance Co. Ltd. will partner with a unit of China International Capital Corp. (CICC) to set up a $1.4 billion fund to invest in companies with real estate assets, as the state-owned insurer taps the property sector for long-term returns despite a market downturn.
• New China Life said it has reached an agreement with China Capital Investment Group (CCIG) to forge the private fund, in which the insurance company will provide 9.999 billion yuan ($1.4 billion) as the limited partner. CICG will be the general partner with 1-million-yuan investment and will manage the fund.
• The fund, with a term of eight years, will focus on direct and indirect investment in companies holding property projects in their long-term portfolios, according to New China Life.

• 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.

• 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.

• 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

Newron has announced positive 12-month data from its Phase II extension trial (study 015) assessing evenamide in 161 patients with treatment-resistant schizophrenia (TRS). The results demonstrate desirable safety and tolerability, as well as durable efficacy of evenamide, showing statistically significant improvements (p-value <0.001) in all key efficacy measures (PANSS, CGI-S and LOF) versus baseline. We believe the results are favourable for Newron’s TRS programme and bolster the company’s plans to launch a potentially pivotal Phase III trial, which management expects to commence in Q224. We note that the company is also gearing up to share results from the Phase III trial (study 008A) for patients with poorly managed schizophrenia in March 2024, which could represent another significant catalyst for investor attention.