Equity Bottom-Up

• 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) 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.

• We visited the core of the Hindi Hinterland, the “City of Patna,” the capital and largest city of Bihar, the country’s third most populous state.
• While the trip paints an opportunistic and optimistic picture of Bihar, the situation of unemployment is something that still warrants attention.
• Focus companies: Aditya Vision (AVL IN) , Eicher Motors (EIM IN)  , Hero Motocorp (HMCL IN) and Fino Payments Bank Ltd (FINOPB IN). 

• 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 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.

• 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. 

• 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. 

• Nike (NKE US) reported 2QFY24 results last week with a guidance cut, as the company cut FY24 full-year sales guidance to around +1%, compared to +mid-single-digit in the previous guidance. 
• Shenzhou Intl Group Holdings (2313 HK) saw its stock drop by 8% the following day, given that Nike is Shenzhou’s most important customer, making up 30% of Shenzhou’s sales. 
• Nike’s inventory is down another 14% yoy, and down high-single-digit compared to the previous quarter 1QFY24. 

• Datamatics Global Services (DATA IN) or DGSL has seen a good operational performance especially since F23, on the back of a difficult IT macro environment. 
• Yet there are some discomforts on the forensic side, especially related to cash component. Low cash yield due to significant current account balances in subsidiaries raises alarm bells. 
• We find opaqueness regarding some important disclosures including Ind AS 115- Revenues and Ind AS 116- Leases. Decision to increase remuneration cap size also leaves us perplexed.

• Grab Holdings looks set to move toward cashflow breakeven in 2H2024 having hit adjusted EBITDA breakeven in 3Q2023 as it successfully struck a delicate balance between growth and profitability.
• The sale of 75% of Tokopedia by GoTo may mean more intense competition in Indonesia as it focuses on online delivery services but Grab is well-positioned to deal with this.
• 2024 will see the potential completion of the Transcab deal plus a potential acquisition in food delivery increasing scale and competitiveness. Valuations are attractive relative to growth and financial position.

• Nuvama reported its first quarterly result since its listing, as a demerged entity. It reported strong growth across all its business segments.
• Wealth management revenues grew 30% YoY, adjusted for one-off accounting impact. Cyclical recovery in the capital markets segment further helped.
• Nuvama has potential to scale up rapidly and grow its profitability exponentially led by growth and operating leverage. At the current valuation, an investment in Nuvama has potential to triple.

• XL Axiata (EXCL IJ) continues to stand as the most direct way to play the data demand in Indonesia as well as being the most convergent of the listed telcos.
• Although it saw some seasonal slowdown in 3Q, the solid growth trajectory remains intact for this year with the completion of the Link Net restructuring driving convergence growth.
• XL Axiata (EXCL IJ) raised data prices again in November and will continue to ride the wave of price reparation over the coming quarters in a more rational pricing environment. 

• Sinopharm’s 23Q1-Q3 results were below expectations. The main reason for weak performance was due to the anti-corruption campaign, which led to profound and rapid changes in fundamentals and policy end.
• In Q4, the impact of anti-corruption would weaken and traditional distribution business would recover.So, 23Q4 performance should be better than Q3, but 23H2 performance would still be worse than 23H1.
• We lowered our forecast for 2023 – Revenue and net profit could achieve single-digit growth. Due to the high base in 23H1, growth in 24H1 could still be under pressure. 

• Taiwan Semiconductor (TSMC) (2330 TT)‘s revenue outlook for 1Q24F is expected to show a decline of around negative high single digits QoQ.
• Intel Corp (INTC US) aims to receive x86 CPU technology from TSMC 3nm in 1H24F.
• Mediatek Inc (2454 TT) plans to utilize 3nm technology for manufacturing smartphone SoCs in 2H24F, which will narrow the gap with Qualcomm Inc (QCOM US).  

• Air China (H) (753 HK) is proposing a new share placement to raise Rmb6bn and HK$2bn. EPS dilution is manageable at 6% so we view the proposal positively.  
• The new equity will enhance book value by 11.5% and lower its gearing by 103pp to 399.8%. The full subscription by the parent is also a vote of confidence. 
• Recent share price weakness is due to the overall weakness in the Chinese equity market, but both macro and operating environments are improving. Selldown is unjustified.

• PC Shares Soaring — After 1) Intel’s AI Everywhere AI chip launch, 2) Launch of First AI PCs, 3) Micron’s positive outlook for PCs in its latest results
• Micron Analysis, Industry Takeaways: Memory Market TAM New Highs into 2025; SK Hynix Trade
• Taiwan Dual-Listings Monitor: TSMC Premium at a Decent Short Level; ASE Short Interest Declining

• Qantas Airways (QAN AU) (QAN) is enjoying the best time of its life on industry consolidation benefits, demand exceeding supply to many sectors, and flourishing air cargo  
• Domestic Australia is an ironclad goldmine, with a benign competitive environment as the archrival is busy restructuring. International sector capacity deployment is picking up, but still deep in underserved territory     
• Target price AUD6.58 (+23% UPSIDE), based on 7x CY2024 PE – long-term historical mean. AUD500 million share buyback should provide downside support 

• Thonburi Healthcare Group (THG TB) has underperformed most of its peers over the last six months. Thus far this year, the company’s financial performance also remained unimpressive.
• Despite a healthy 29% YoY increase in normalized medical services revenue, normalized net profit decreased 8% YoY in 3Q23 as the company experienced significantly higher financial costs.
• Although the company is repaying debts, debt level is still elevated and is expected to remain so in the near-term due to upcoming capex plans.

• It’s a greater chance that there will be an upward pickup in 2024F revenue for King Yuan Electronics Co, Ltd. (2449 TT), but the magnitude is hard to predict in 1H24.  
• It is expected the revenue to decline by approximately -5% in 1Q24F.
• However, the demand for CoWoS at a corporate level is expected to increase by about 10% in 2024F .

• The almost viral popularity of Familymart’s line of basic clothing items continues to grow and shows the real potential for convenience stores to diversify and adapt. 
• Backed by Itochu, Familymart has expanded the product range and added new, limited edition items and brand collaborations, creating a success story that Seven Eleven may find hard to emulate.
• Lawson, however, is controlled by Mitsubishi Corp which happens to have a clothing production arm that was behind the early success of Uniqlo and Adastria.

• We compile a report card for dividend-yielding mid-caps that filter out on favorable characteristics of having net cash, decent ROEs, growth, etc. 
• It’s been a disappointing year in share price performance owing to the negativity surrounding China and soft business performance in some cases, but there have been some bright spots.
• We help provide a comprehensive list of our updates on some names and an outlook for 2024. It’s our last insight for 2023, so happy new year everyone!

• China announced game approval for the December batch. The number of games approved has increased compared to recent months.
• The pace of China game approval appears to be accelerating, to the same level as pre-tightening.
• Netease scored two approvals while Tencent scored one. Netease finished the year with the most games approved.

• For the upcoming revenue outlook, MediaTek Inc (2454 TT) is likely to reach an upside of around 10% QoQ in 1Q24F.
• MediaTek plans to release 12 million units of the Dimensity 9000 series in 2024F.
• Mediatek’s target markets include China, India, and Southeast Asia, with China remaining the primary market of focus.

• Indocement (INTP IJ) is trading close to 2-year lows, which seems unjustified given the ongoing recovery and a more positive outlook for FY2024. 
• The company continues to grow its distribution reach to satisfy demand from IKN in Kalimantan, smelters in Sulawesi, and East Indonesia, with acquired Semen Grobogan feeding Central Java. 
• Indocement (INTP IJ) continues to build on its sustainable credentials through the use of alternative fuels and reducing emissions and dust. Valauations are attractive trading on 6.8x FY2024E EV/EBITDA.

• “Pent-Up demand”? No signs of it anywhere in outbound or domestic metrics
• Sluggish outbound demand, capacity trajectories continued to lag in November
• YTD share performance weak, mirrors disappointing recovery in travel activity

• UPI Semi is a specialist designer of electronic components and semiconductors for power management. Power management is a key performance factor for AI devices.
• UPI’s clients include most of the world’s largest leading technology companies for semiconductor distribution and AI products.
• UPI shares have lagged the strong performance of its clients — We see opportunity for UPI to now Outperform.

• In the Chinese pharmaceutical industry, stock selection strategies can be divided into “defensive” and “offensive”. We need to combine the judgment of the cycle to choose a stock picking strategy.
• Domestic innovative pharmaceutical companies have the opportunity to create a high gross-margin incremental market of over RMB1 trillion through successful internationalization, but we pointed out the logical flaw behind.
• We analyzed the key points of Hangzhou Tigermed Consulting (3347 HK). It seems insiders don’t have firm confidence in the prospects, so why should investors rush to buy the bottom?

• TSMC: 10.5% Premium — Still a Good Level to Short the Spread
• UMC: Trading at -1.1% Discount — Uncompelling, Wait for Deeper Discount
• ASE: 8.8% Premium — Still Wait for Lower Levels Before Going Long

• Nike’s Q2 results lead to a 12% drop in its shares, affecting sector peers Onon, Skechers, and Asics with significant declines.
• Challenging trading conditions in China and Europe, coupled with a subdued digital traffic outlook from Nike, raise broader concerns for the sector.
• Asics stock declines 20% post-Nike’s fall, presenting an attractive buying opportunity with an estimated 20% upside, positioning Asics as a cost-effective play in the global performance running market.

• Despite being a hated stock among the Super Sevens, Apple shares are up >51% YTD this year. Apple has had little to claim for within captivating AI hype.
• Apple is not a first mover. Its reputation is of a late comer. But its superior products with mind bending experiences blows competition out of the water.
• Outperformance of iPhone 15, deepening services penetration, and roll out of AI-features will propel Apple to a USD 4 trillion market cap in 2024.

• Tencent and NetEase’s stock prices plunged after the release of the new law about online game.
• China Passenger Car Association expects NEV will grow by 37% for 2023.
• NIO got US2.2 billion investment from CYVN Holdings based in Abu Dahbi.

• Quantum Solutions has given up 63% of its recent gain but has more NVIDIA GPU related orders in the pipeline. Keep an eye on the stock and the news flow.
• The recent upward revision to sales and profit guidance has been followed by the announcement of a capital and business tie-up with Hajime Tabata’s JP Games.
• The addition of Web-3.0 gaming to distribution of AI servers and Arm-based edge computing hardware could change the nature of the investment.

• H1 FY24 (May-Oct 2023) was off to a sluggish start for the company, with a 4.7%/35% decline in revenue/adjusted NPAT. 
• The company cited soft demand, loss of business days due to inclement weather, one-offs in relocation or warehouses to efficient locations, and increased staff costs for poor profits.
• Post the correction, the stock trades at a trailing PE of 11x and dividend yield of 8%, but we will have to wait further out as business conditions are worse. 

• Following a strong margin performance in 2Q, we are raising our 3QFY24 EPS estimate to $0.43, just below the midpoint of guidance, from $0.38.
• The increase is the result of higher margin assumptions on a lower revenue forecast.
• We are also reviewing and lowering our revenue assumptions for the remainder of FY24 and FY25. 

• China has tightened restrictions on online games again driving significant falls in names such as Tencent and NetEase. 
• While the move may surprise some given prior moves to restart approvals in our view the overall trend of regulation is not especially surprising. 
• In particular, the tightened regulations appear to target the most important drivers of mobile gaming profitability and today’s large drops may actually be underreactions.

• GoTo senior management hosted an analyst call last week to provide further details on both the reasons behind the Tokopedia sale and the potential synergies and benefits of the move. 
• After the deal completes, GoTo will cede all management control but will receive a revenue stream from core GTV, which excludes digital products and certain big-ticket items.
• Plumbing for this deal effectively de-risks its exposure to e-commerce given it is not required to inject any new capital but it does take away future optionality on Tokpedia’s growth.  

• CPNG will provide Farfetch with a bridge loan to save it from default. In exchange, CPNG acquires Farfetch business and its US$ 460mn+ net debt.
• For Farfetch to achieve profitability, CPNG will need to conduct major layoffs and cancel brand deals, but both are difficult to achieve, in our view.
• CPNG only found limited overseas success in Taiwan, and EU poses an even greater challenge. We cut TP to US$ 14.1 on increased debt and FCF burden.

• Relative Value Trade in Micron Has Worked Since Our Last Piece; Results Blow Away Expectations
• Memory Pricing Improvement Continues, Management Expects Pricing Increases Through Calendar Year 2024 and 2025
• We Remain Structurally Long Memory; Now See Relative Value in SK Hynix

• O Ta Precision Industry is a company based in Taiwan that mainly makes golf clubs for global golf equipment branded companies including Titleist, PXG, Mizuno, and Honma.
• O-Ta Precision’s dividend yield averaged 9.2% annually from 2019 to 2022. Its annual dividend payout averaged 68.5% in the same period.
• We like the company’s strong niche in the golf club OEM/ODM business with excellent list of customers with its its historically high dividend payout ratio and dividend yields. 

• The Medium-Term Management Plan UNISOL includes the following FY26/12 targets, net sales of ¥200.0 bn, operating profit of ¥10.0 bn, and ROE of 8.5%.
• MARUKA FURUSATO will enter the 2nd stage of the plan, a period of accelerated growth, starting in FY24/12. During the 1st stage of the plan, which was centered on establishing a base, various initiatives were undertaken.
• The company promoted cross sales and expanded rebates through commercial flow integration, starting with streamlining administration departments, which included merging offices. 

Actinogen Medical has opened the first investigational study site for its Phase IIb XanaMIA trial of lead candidate Xanamem in patients with cognitive impairment (CI) associated with mild-to-moderate Alzheimer’s disease (AD). The study plans to enrol c 220 patients, who will be randomised to take Xanamem 10mg or placebo once daily for 36 weeks. The trial will concentrate on Australian test sites for the first 100 enrolled patients, and initial efficacy and safety results will be analysed when these patients reach 24 weeks of treatment. The results, expected in H1 CY25, could serve as a significant catalyst if data are positive. Nearer term, the next material milestone will be results, expected in Q2 CY24, from Actinogen’s Phase IIa XanaCIDD study in patients with CI and major depressive disorder (MDD). A positive XanaCIDD readout may lead to a share price re rating, and thereby may potentially accelerate the expansion of XanaMIA to US and global clinical study sites.

Basilea recently expanded its antifungal and antibacterial product pipeline with three new assets, including the latest addition, fosmanogepix. As a broad-spectrum antifungal (including multidrug-resistant fungi), fosmanogepix has a novel mechanism of action, a key differentiator in the rise of antifungal drug resistance. Two Phase III trials are expected to commence in mid- and late-2024 (in candidemia/invasive candidiasis and invasive mould infections, respectively) and a successful launch has the potential to refill the pipeline as the company’s lead asset Cresemba matures. We update our estimates and valuation to reflect the revised FY23 guidance and incorporate the potential contribution from fosmanogepix. Our overall valuation increases to CHF910.4m or CHF76.0/share (from CHF797.8m or CHF66.6/share previously). In the more immediate term, we view the US New Drug Application (NDA) decision on Zevtera (PDUFA date of 3 April 2024) as the next big catalyst for the company.

AFT Pharmaceuticals has bolstered its R&D pipeline with the addition of a new product candidate, HY-090, a locally acting novel molecule, targeting Burning Mouth Syndrome (BMS), a condition with no curative treatments. AFT will be developing the asset in collaboration with Hyloris Pharmaceuticals (existing development partner for Maxigesic IV). While Hyloris will be responsible for product formulation, manufacturing and commercialisation in Europe, AFT will take care of clinical trials and related modalities, as well as commercialisation ex-Europe. The US activities will be co-managed by the two partners. HY-090 is one of two R&D assets that was already in active consideration by AFT and diligence work is ongoing for another three. A robust R&D program has always been a focus area for AFT and we believe an active pipeline will be instrumental in driving growth and increasing the company’s international footprint.

• In the latest wave of management changes, Eddie Wu, Jack Ma’s trusted associate has staged a comeback, securing pivotal roles.
• We believe this is not a mere coincidence. Jack Ma seems to be orchestrating moves from behind the scenes, with Eddie Wu strategically positioned to represent his influence.
• The Chinese government’s reaction to Jack Ma’s increased involvement may impact Alibaba Group Holding (9988 HK)‘s price performance in the short term.

• Plover Bay Technologies (1523 HK) is another exciting play from the stable of net cash (12% of market cap) and high dividend yield (8% FY22) companies.  
• The company develops networking technologies that enable supercharged connectivity. Users can build always-on networks anywhere by combining fixed, mobile, and satellite connectivity. Its major brands are Peplink and Pepwave.
• Plover Bay is a high net margin (25%) and high ROE (>50%) business that has 9-10% CAGR revenue growth (trading at 11x PE) with catalysts up ahead. 

• Sumber Alfaria Trijaya has decided to pare back the velocity of the expansion of Lawson convenience stores as it consolidates its leading position and maximises efficiencies.
• 4Q2023 saw slower growth in November but December should be stronger, whilst its store expansion for 2023 reached 1,700 new stores, with plans for around 1,300 new stores in 2024.
• Sumber Alfaria Trijaya remains the best way to play the minimarket space in Indonesia. 4Q 2023 numbers should provide a positive catalyst given it is the seasonally high quarter. 

• Intel’s “AI Everywhere” event turned out to be little more than last minute launches client and server products promised for 2023
• While these products have little new in the way of ground-breaking AI hardware, the entire event was infused with AI marketing to the highest degree
• Ostensibly Intel’s great hope in AI hardware acceleration, Gaudi, featured solely as a last minute gimmick announcing that Gaudi3 was “out of the fab and into the lab”. Yawn!

• Edelweiss reported a decent Q2FY24 with ex-Insurance PAT of INR 153cr vs INR 133cr YoY. All the businesses – ARC, Asset Management and Credit – performed well.
• Edelweiss is making decent progress in the Credit business aided by the co-lending business model. 80% of disbursals in NBFC and 30% in Housing Finance in Q2FY24 were through co-lending.
• Edelweiss is in process of selling a minority stake in its Alternative Asset Management business for value unlocking. It plans to sell 10-20% equity stake for INR 1500-2000cr.

• The 20% retreat in the share price of Cosco Shipping Energy Transportation (1138 HK) from the peak has well reflected the plunge in 3Q23 VLCC rates and 10% earnings downgrade.
• 4Q23 VLCC rates have rebounded 78.4% QoQ. Re-routing due to recent Houthi attacks on commercial ships at the Red Sea has reduced effective supply and is positive to rates.
• Heightened energy security needs will drive demand. The medium-term supply pressure is mild as the VLCC orderbook equals just 2% of the existing fleet, fueling ROE for FY23-25F. 

• Airports of Thailand (AOT TB) 6m24 revenue growth rates are healthy, supported by the growth in departure passenger service charges and the coming back of concession revenues.
• AOT labor expenses have expanded at an unprecedented level, even higher than pre-COVID levels, while Malaysia Airports Holdings (MAHB MK) kept them under control.
• Book profit on half of the exposure and wait for the next quarter to see if AOT labor expenses will stay high.

• Fully independent DX provider: Japan System Techniques (JAST) is an independent system integrator that develops and sells software and systems, which celebrated its 50th anniversary.
• The company develops systems for customers in a variety of industries and sectors, including finance, manufacturing, distribution, services, public services, telecommunications, transportation, and science and technology.
• Furthermore, as a developer, the company has three main JAST-branded software offerings for its customers, namely GAKUEN for the education industry, BankNeo for the financial industry, and JMICS (JAST Medical Insurance Checking System) for the medical industry and the profitability of these own-brand businesses is very high.

• Lots of financial analysts and other Calcbench users might be wishing they could sail away on a tropical cruise as we enter the holiday slow season, so perhaps it’s a good time to visit Carnival Corp. ($CCL) and the company’s latest financial performance. 
• Carnival filed its latest quarterly (and fiscal year-end) earnings release on Thursday, and top-line numbers looked pretty good for a company still recovering from the pandemic’s apocalyptic effects four years ago.
• Quarterly revenue jumped 40.6 percent from the year-ago period, to $5.4 billion; annual revenue soared 77.5 percent to $21.6 billion. 

• After market close on December 20, MillerKnoll reported 2QFY24 adjusted EPS of $0.59, ahead of our estimate of $0.55 and the consensus mean of $0.54.
• Margins were better than expected, while revenue of $949.5 million came in at the low end of guidance.
• Sales in the Americas segment disappointed relative to our expectations.

• Regulatory Tangles:Promoters faced cricket betting allegations, SEBI penalties, debarment from financial markets and a litany of investigations. Legal and financial risks loom due to regulatory delays and unresolved litigations.
• Operational and Financial Hurdles:Excessive inventory, delayed payments, and opaque related-party transactions.Weaker margins, ROE, and underutilized manufacturing hint at broader governance frailty.
• Debt Dilemmas and Transparency Concerns: Heavy reliance on high-interest promoter loans. Governance lapses are reflected in financial metrics, raising questions about transparency and conflicts of interest.

• We view both Weixin Video Account (WVA) and Douyin China as secondary assets to their respective parents, which in our view, may lead to them forming…(TBC)
• However, rising competition in the short-play (短剧) market may put the two businesses in more direct confrontation, which may delay or diminish the chance for two to work together;
• We view Tencent as the likely winner in the continuing evolution of short video as it considers various options to maximize the value of WVA traffic.

• Local news reported an unnamed expert suggesting ByteDance might be buying Eleme for US$7bn, leading to share of Meituan to fall;
• While we believe (1) buying a food delivery business to complement Douyin’s in-store business makes some sense and…
• (2) ByteDance has been aggressive in pushing the boundary of its businesses, an entry into domestic food delivery is a daunting challenge that yields very little benefits for ByteDance;

• Singapore Airlines (SIA SP) (SIA) November operating statistics were good, passenger load factor rose by 1.9ppt YoY to 87.8%, and cargo load factor rose by a similar quantum  
• Market observations suggest yields should remain at high levels and cost items such as fuel and USD-denominated items on a favorable downtrend 
• If this performance continues, SIA will beat consensus easily. We recommend BUY with a TP of SGD8.07 – pegged to 10x FY24 PE. (+26% UPSIDE)  

• Driven by stronger PC/networking DRAM sales, Micron reports 5% stronger 4Q23 sales, 10-13ppts q/q margin improvement and 34% y/y decline in MOI to 5.2 months;
• Micron guides 1Q24 sales growth 8-16% q/q and 38-49% y/y and gross margin of 12%, beating Bloomberg consensus estimates by 6ppts;
• Rooms to raise: 1. 1Q24 sales of 18% q/q likely; 2. Turning profits sooner than expected; 3. +Free cash flow in 2024; 4. HBM3E for GH200/H200 to improve mix, margin. 

• Q3 2023 results for the Philippine Stock Exchange / (PSE PM) were uneventful. EBITDA margins were rock solid at>60%, and net margins were>40%. Revenues and profits were up 1.3%/51% YoY.
• Cash and Investments at 4.8 bn pesos account for 32% of the market capitalization. The cash will aid in acquiring the remaining 79% stake in PDS.
• Trading at 19x/17x FY23e/24e and a dividend yield of 5.3%/5.9%, there are several catalysts to drive earnings over the next few years (and investors are paid to wait). 

• LIFULL runs the LIFULL Home’s real estate website. Compared to its main rival, whose strategy is focused mainly on the quantity of listings, LIFULL’s aim is to achieve greater quality, as measured by the percentage of inquiries that lead to sales for professional real estate clients.
• While others primarily charge a fixed fee for listings, LIFULL charges a combination of fixed fees and incentive fees based on the number of inquiries received for a listing.
• Compared to its main rival LIFULL tends to invest more heavily in software development and considerably less on advertising. 

• Pfizer seems to be the worst-performing large pharma stock of 2023 after it lowered 2024 forecast. The Company continues to grapple with plummeting demand for its COVID products
• The acquisition of Seagen can’t turn things around. Except a few products that are still able to maintain growth, sales of vast majority products that we’re familiar with are declining. 
• The growth engine of Pfizer in post-pandemic era is still uncertain. Even though Pfizer’s share price has fallen sharply, this may still not be the time for bottom fishing.

Pan American Silver (PAAS) released a preliminary economic assessment (PEA) of the La Colorada Skarn project, confirming its potential to become a large-scale operation producing an average 17.2Moz of silver per annum over the first 10 years of its 17-year mine life. At a base case throughput rate of 50ktpd, the company estimates the project’s post-tax NPV8 at US$1.1bn, with an IRR of 14% and a payback period of 4.3 years. We intend to update our valuation shortly to incorporate the PEA and the prevailing stronger than expected gold and silver prices.

• MillerKnoll reports 2QFY24 earnings after market close on Wednesday, December 20, and will host its management conference call at 5:00 pm ET.
• WTR is modeling EPS of $0.55, the midpoint of guidance, on revenue of $987 million. Consensus is $0.54, with an estimate range of $0.52-0.56.
• Order trends. We are modeling orders in the Americas at +13.9% versus a poor year-ago quarter of -17.3%.

• Chairman 69 years old Dr. Liu will retire and 70 years old CEO Dr. Wei will step up. What story do we believe? Will TSMC to regain its strong outperperformance?
• Positive impacts: we expect Arizona fab equipment move-in and ramp up might be further delayed if no subsidies are granted; two teams competing to one voice/team/direction.
• Three risks: 1. Dr. Wei at his age of 70 without a strong management backup; 2. Dr. Wei might make a wrong decision deeply; 3. absolute power corrupts.

• Google Search trends for Tokyo Disneyland and DisneySea in recent months point to potential vulnerabilities in Oriental Land’s FQ3 performance.
• Tokyo Disneyland’s rising ticket prices have narrowed the cost gap with Shanghai and Hong Kong Disneyland, potentially leading to a loss of customers to its counterparts.
• Should Oriental Land (4661 JP) shares fail to surpass its recent peak in January next year, we think shares could undergo a rather substantial correction.

• Asagami Corporation (TYO 9311) owns 3 warehouses on Tokyo Harbor with land carried on its books at ¥7.9 billion.
• These properties alone are likely worth closer to ¥29.5 billion.
• These assets account for less than half of the company’s land assets, but are worth multiples of the current market cap of just ¥7.16B.

• We see Ueda’s pause on lifting its negative rates policy as temporary, and we expect that this policy change could occur as early as January
• Despite this monetary pause in tightening and the fall in 10Y JGB yields, we are encouraged by the rise in long term loan yields in the BoJ data to October-end
• We reiterate our positive views on Resona, Mizuho, MUFG and Concordia

• China East Education (667 HK) is interesting as it is probably the only education company with no debt. Net cash amounted to Rmb2.1bn, or 42% of its market capitalisation. 
• Earnings have bottomed out and the marginal YoY decline in 1H23 is due to upfront costs for staff recruitment. Its vocational education focus also faces fewer regulatory risks.
• We consider it a potential privatisation candidate at 0.8x P/B. Its major shareholders owned 75% of the company, leaving a free float of less than HK$1.4bn.

• While the profitability of Stylam Industries (SYIL IN) is growing healthily (>30% YoY) in H1 FY24 due to margin expansion, revenues are trending at -4.5% YoY.
• The company became net cash in H1 FY24 (73 crore INR)  and zero gross debt. A strong balance sheet would aid in the company’s expansion plans. 
• Trading at 23x/18x FY24e/25e, we see strong growth ahead for the company as it cements its position as one of India’s top laminate export players. 

Games Workshop Group (GAW) has signed an agreement with Amazon Content Services, a subsidiary of Amazon.com, to prospectively develop GAW’s intellectual property (IP) into film and television content and to grant associated merchandising rights, initially focused on the Warhammer 40k universe. The partnership follows the announcement in December 2022 when management said an agreement had been reached in principle. Although the content will mainly be focused on GAW’s Warhammer 40k, Amazon has the option to develop other IP within GAW’s fantasy universe following the initial release. The first year has been set out as a period for creative discussions, after which the agreement will go ahead if both GAW and Amazon sign off on the creative guidelines.

• Ricegrowers Limited, trading as SunRice (ASX:SGLLV), has released its H1 FY24 results, delivering RaaS adjusted EBITDA of $69m (+68%) and adjusted NPAT of $33.3m (+107%), both well above RaaS estimates of $57.6m and $25m respectively.
• Divisionally the key surprise was International, delivering adjusted EBITDA of $33m, 125% above the PCP and 57% above RaaS estimates on the back of increases scale and reach, price increases and lower freight costs.
• Operating cash flow was the strongest since H2 FY18 despite a high tax payment as working capital improved from lower receivables and inventory reductions. 

• We recently caught up with management to congratulate James Colquhoun on his promotion to CEO.
• We also got a good update on the business as well as some early indications of trends and management focus for 2024.
• As indicated on the 3Q23 earnings call, new member growth is continuing at a healthy clip and management expects to close 2023 at around 800k members.

• The market seems “not excited” with fruquintinib’s FDA approval.We analyzed the potential reasons behind.Beyond boosting market sentiment when license-out deal is announced initially,its practical impact on valuation could be limited.
• HUTCHMED’s financial performance is good. The deal with Takeda helps to relieve cash-flow pressure. We think HUTCHMED is a relatively safe bet for investors as eventual breakeven is drawing near.
• If based on conservative calculation, market value of about US$1,455-2,055 million is a good place to long.When market value is higher than US$3,500 million, it’s time to consider taking profits.