Equity Bottom-Up

• A stabilizing property market matters more than other factors such as industry rivalry and shareholder return policies for the performance of leading China e-commerce players in our view.
• China’s worst property market downturn is probably behind us. This will gradually help restore consumer confidence and lift consumer propensity to spend, improving growth outlook for China e-commerce sector.
• We believe China e-commerce players will in general benefit from a stabilizing housing market. Alibaba remains the most attractive play in the space. 

• A high disease burden, high demand for chronic treatment, and an ageing population makes China an excellent opportunity for an established pharma company.
• With 1/3 of the market cap in cash, a healthy payout ratio, and a FPE of under 8, CMS is one of the bargain beneficiaries in the Chinese healthcare space.
• The founder/CEO recently purchased 8m shares. He last bought shares in 2020-2021. The share price almost tripled afterwards.

• Onewo (2602 HK), a leading China property management company with the controlling shareholder being China Vanke (H) (2202 HK), announced a major share repurchase mandate last night.
• The company intends to repurchase its shares in the open market up to HKD5.8bn, which is around 20% of the current market cap. 
• The company is trading at 13x 2024E PE on around 15% net profit growth in 2024E, and at 5% forward dividend yield. 

• Foxconn’s Hyderabad factory to begin producing Airpods in August, as confirmed by Telangana official.
• Qualcomm CEO backs Arm’s forecast of 50% Windows PC market share in 5 years.
• UnaBiz achieves record-breaking 90% accuracy with AI-enabled Wi-Fi geolocation; Nvidia and Foxconn unveil advanced computing center in Taiwan. EU establishes AI office to enforce AI Act. Tower Semi awaits wafer fab approval in India post-elections. Win Semiconductors propelled by mobile phone surge into 2024.

• Vanguard announce the establishment of a 12” Fab in Singapore with 60% stake, with Nxp Semiconductors Nv (NXPI US) will invest remaining 40%.  
• The nodes produced will span from 40nm to 130nm, encompassing mixed-signal, PMIC, and analog ICs to support automotive, industrial, consumer, and mobile applications.  
• Vanguard will uphold a healthy cash balance, along with large debt and a follow-up cash offering.

• Apollo-Managed funds and affiliates will lead an investment of $11 billion to acquire from Intel a 49% equity interest in a joint venture entity related to Intel’s Fab 34
• This deal follows a similar mid-2022 deal with Brookfield to co-invest in two new leading edge fabs in Arizona at a cost of up to $30 billion
• Why make the deal with Fab 34 in Ireland instead of the Ohio fab under construction?

• Surge in revenue during 1Q24 may have implications for a return to strong profit growth
• There is no evidence of structurally weaker core costs, like COGS and SGA and even R&D
• ROE is now above 20% and this after it large capital raising in FY22

• Marvell had a pretty solid result and guided to sequentially better revenue.

• The market didn’t like this, but I thought, looking through the result, I liked this result quite a bit. Shares did not.

• Marvell Technology reports Q1 EPS $0.24 ex-items vs FactSet $0.24.

• Lasertec shares dropped nearly 8% following a scathing 53-page report by Scorpion Capital, accusing management of “colossal fraud.” 
• The SC report is shrill, in our view, and therefore, we think we add value by contributing a second opinion. 
• In our view, Lasertec is due for a correction even if SC’s report is inundated by hyperbole.

• CP Axtra (CPAXT TB) is a merger upon a merger combining the Makro wholesale business and the Lotus hypermarket and supermarket businesses, along with a hybrid mall operation. 
• The combined entity continues to realise operational synergies in sourcing and logistics, with a strong B2B element. Omnichannel makes up more than 16% of sales and is growing rapidly.
• CP Axtra (CPAXT TB) provides an alternative retail exposure to its parent CP ALL (CPALL TB) with ongoing restructuring benefits still to be realised. Valuations look attractive relative to growth.  

• In 1Q24, Pop Mart International Group L (9992 HK)‘s international sales grew around 250% yoy, and made up around one quarter of sales (vs. 17% of sales in 2023). 
• I now expect 39% sales growth in 2024, driven by 140% yoy growth in the international business and 18% growth in domestic China business. 
• I further expect a 50% yoy growth in net profit growth in 2024 driven by a 0.8ppt increase in gross margin and 0.5ppt in operating leverage. 

• Gelsinger excited for AI PC breakthrough at Computex 2024, plans Intel’s 40th anniversary event in Taiwan next year.
• MediaTek unveils AI and wireless advancements at Computex 2024, demonstrating commitment to technology innovation.
• Nvidia CEO predicts rise of robots in the future; Taiwan’s LEO satellite program delayed by funding and tech transfer issues.

• Accounting fraud costs the global economy at least US$1 trillion each year in losses to investors, suppliers and consumers
• Detecting accounting fraud early gives investors valuable intel to rethink certain stock or bond holdings.
• Transparently.AI’s AI-powered solution is highly accurate in measuring and detecting accounting manipulation and fraud.

• The market’s assumption of no special dividends in Chow Tai Fook Jewellery (1929 HK)‘s upcoming FY24 result is conservative, and this does not fit into its usual pattern. 
• Should it pay special DPS, the dividend yield may reach an attractive 10.7%. With its net cash position, CTF can financially maintain the average 135.6% payout ratio. 
• A return to its historical average dividend yield of 7.4% means that CTF’s share price will need to go up by 45% from the current level.

• Tosei achieved record revenue and profit, driven by robust growth in its fund management business and a balanced portfolio of stable and sales-driven operations.
• Activist investor Dalton acquired a 5.02% stake, highlighting concerns over recent governance decisions and potential Board independence dilution due to the Nagoya Railroad alliance.
• Dalton’s involvement ensures heightened scrutiny, promising better governance, and potentially favorable outcomes for minority shareholders amid Tosei’s continued strong business performance.

• Short term overhang from expanded share count and selling from unwilling participants
• The copper supply and demand story is intact and the fundamentals of the company remain strong
• Parent’s uptake of the rights is positive but the stock will take time to build a base for the next leg up 

• Results underline high earnings visibility in Profit-Generating Funeral Services – Q1-4 FY3/24 results were in line with guidance, with positive high growth momentum being sustained at Profit- Generating Funeral Services.
• The legacy businesses (Information and HR) missed forecasts, highlighting turnaround challenges.
• However, the new business Asset Consulting has started strongly as a high-margin activity, and the outlook is positive. 

• Carnival Corporation is the world’s largest cruise ship operator with a large fleet and significant market share
• The company was severely impacted by the COVID-19 pandemic, halting service for 15 months and taking on substantial debt
• Since resuming cruises in July 2021, Carnival has seen a rebound in revenues driven by strong demand for post-COVID travel, but still faces challenges with cashflow and debt sustainability

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.

• RaaS Research Group has published a flash comment on advanced materials manufacturing group Amaero International (ASX:3DA) following its announcement that the first atomiser has been commissioned at its Tennessee facility ahead of schedule.
• The commissioning is an important step toward the production of C103 and specialty alloy powder at the facility and allows the company to move to the next step of achieving qualification and, ultimately, commercialisation.
• Amaero’s announcement underpins our confidence in the production timing we have applied to our estimates.

• On May 28, 2024, MediciNova, Inc. (MNOV) announced that two abstracts regarding MN-001 (tipelukast) and MN-002 were presented as posters at the 92nd European Atherosclerosis Society (EAS) 2024 Congress.
• The poster on MN-001 discussed the objectives and design of the ongoing Phase 2 clinical trial enrolling patients with Type 2 diabetes, dyslipidemia, and NAFLD, which has now enrolled a total of 33 patients.
• The other presentation regarded the mechanism of action of MN-001/MN-002 in lipid metabolism.

• Alibaba Pictures’ revenue increased by 44% YoY and EBTIDA increased by 61% in the March quarter.
• Cainiao, Alibaba’s logistics network, plans to purchase fresh food from the places of origin.
• Li Auto finished a round of layoff, in which headcount was reduced to 22,000 from 30,000.

• Indiabulls Housing Finance (IHFL IN) Raised INR 3,693 crores through rights issue, issued $350 million bond.
• Strong balance sheet, low NPAs, poised for growth in the retail housing via its asset light model.
• Rebranding to Samman Capital signals new phase of the company with multi-year growth guidance.

• On 3 June, the shares of Korea Gas jumped limit up 30% to 38,700 won on huge volume (13.4 million), which was 37x higher than the previous day volume traded. 
• This was driven by the announcement of the South Korean President Yoon giving the approval to conduct exploratory drilling for potentially vast oil and gas prospects near Pohang. 
• The Korean government announced that there is a “very high” possibility the area contains as much as 14 billion barrels of oil and gas.

• SK Hynix leads in next-gen HBM innovation, setting pace with Indian startup FermionIC aiming for market domination.
• AMD releases new processors for data centers and PCs promising improved performance and efficiency with Instinct, Ryzen, and EPYC.
• India partners with Taiwan for semiconductor ecosystem development, while Russia plans to produce 350nm chips with self-developed EUV machines in 2024.

• Q124 showed solid top-line growth, impressive improvement in core margins
• We are not too concerned about moderating domestic hotel, air pricing
• After consensus EPS raised, TCOM a BUY below US$50 per ADS, in our view

• Numerical targets for FY24/12 initial guidance are shown in the exhibit below.
• Despite initial guidance for consolidated OP of ¥800mn, an increase of ¥420mn (+110.3% YoY), the Company cites conservatively forecasting non-operating and extraordinary items such as interest expenses, restructuring costs, and exchange rate fluctuations for initial guidance for ordinary profit break-even and a net loss of (¥600mn) for profit attributable to owners of parent (see P2).
• Key initiatives and expectations for 2024 include: 1) in Japan, aim to provide more data-oriented and efficient services (online golf equipment sales GPM improving after 4Q inventory adjustment), 2) GOLFTEC golf lesson cash sales set to improve on coach issue addressed and marketing campaigns such as “7 shots better,” and 3) expand SkyTrak sales distribution channels. 

• A near-term key NVX goal is to secure additional customers and lock in demand.
• NVX recently formed an agreement with PowerCo SE, part of the Volkswagen Group, to develop, test and analyze synthetic graphite anode materials customized for PowerCo’s requirements.
• If successful, this could lead to a new supply agreement.

• Institutions were net buyers of Singapore stocks over the five trading sessions through to May 30, with S$108.4 million of net institutional inflow, as 20 primary-listed companies conducted buybacks by way of market acquisition with a total consideration of S$37.9 million.
• Meanwhile Mapletree Pan Asia Commercial Trust, Singapore Airlines, Mapletree Logistics Trust, Jardine Cycle & Carriage, CapitaLand Ascendas Reit, Sembcorp Industries, UOL Group, Jardine Matheson Holdings, Mapletree Industrial Trust, and Keppel Reit led the net institutional outflow over the five sessions.
• In addition to the 9.3 per cent interest that the Tang group owns in ARA H-Trust, the proposed acquisition increases the Tangs’ holding in ARA H-Trust to 28.3 per cent.

• SLCA has seen a decrease in shares and reduction in debt, making its enterprise value cheaper
• Core thesis remains unchanged, with focus on potential split of company’s two businesses for separate valuations
• Recent acquisition in frack sand business by Atlas Energy provides comparable valuation exercise for SLCA, suggesting potential value of company’s assets and opportunity for increased valuation in the future

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.

• 1Q24 production (excluding NGL) in the Williston was 1,151 boe/d.
• This is 140 boe/d above our expectations and ~100 boe/d above 4Q23 production.
• Production in March (excluding NGL) had increased to 1,212 boe/d.

• Several US customs brokers have been suspended under new, tighter rules
• The new rules could make ‘de minimis’ imports slightly more difficult
• Whether it lists in London or NYC, additional rule changes could threaten SHEIN

• Xiaomi reported CY1Q24 revenue, non-IFRS operating income and non-IFRS net income 2.7%, in-line, and 21.7% vs. consensus;
• SU7 interest drove more and higher quality traffic to Xiaomi channels, driving higher revenue and margin for IoT and handset sales, in our view. 
• We expect this augmentation to sustain higher non-EV margin and growth in the long-run, and for ADAS and battery upgrades to drive demand for its next EVs. 

• Innovent’s 24Q1 product sales was up just 6% QoQ. The overall data shows that PD-1 growth has entered a bottleneck. This makes 24H2 YoY growth rate uncertain.
• The deal between Hengrui and Hercules is different from traditional license-out cooperation, but belong to asset spin-off in essence, which is a “smart deal” and also a meaningful attempt.
• There’re some positive signals in Zai Lab’s 24Q1 performance, but the pain points of business model severely limit its profitability/revenue scale. Zai Lab still has a long way to go.

• Divi’s Laboratories (DIVI IN) reported steady performance in Q4FY24, marked by YoY and sequential growth in revenue and improvement in profitability. Double-digit growth is expected to continue.
• Custom Synthesis business grew 47% YoY and 38% QoQ to INR12B in Q4FY24, driven by increasing value realization from existing commercial projects and addition of new projects to the portfolio.
• In Custom Synthesis, Divi’s Lab is in the process of entering into a long-term supply agreement with an MNC customer and is planning for capacity addition at its manufacturing facility.

• In the fourth quarter fiscal of 2024, Deckers Brands achieved record revenue growth of 18% compared to the previous year, almost reaching $4.3 billion of annual revenue.
• Gross margin increased by a considerable 530 basis points from last year to 55.6%, and earnings per share rose by 51% to $29.16.
• These results reflect Deckers’ successful long-term strategies and the hard work of its employees.

• Cosco Shipping Energy Transp. Co. Ltd. (H) (1138 HK)‘s 1.25x 12-month forward P/B is more than 2SD above historical average. Though earnings have improved, this still appears rich.
• The market expects this upcycle will sustain for at least 5 years, but as a cyclical stock, CSET has never had such a long cycle in the last 10 years. 
• While VLCC rate has gained 36% YTD, the average for FY24 is just in line with 2H22 and 1H23. However, earnings projections are 57% higher than that time.

• Ivonescimab’s (AK112) head-to-head clinical win against Keytruda (Pembrolizumab) reaffirmed Akeso’s standing as the flag-bearer of Chinese innovative drugs. It also affirmed its business model of specialized R&D+flexible distribution. 
• This success might be followed by a similar win globally in 2025-27,as well as AK112 and 104’s head-to-head win against Tislelizumab.
• We reiterate our BUY rating on Akeso and adjust TP to HK$58 to reflect revenue share from AK112 to come in from 2025 but in bulk after 2027

• ASM is a hedge fund with a strong track record of investor activism in taking over distressed assets and closed-end funds. 
• Lazard, the second largest CMCDI shareholder, bought shares last week at a multi-year high sending a strong message to the market.
• CMCDI can also explore announcing a discount management program besides agreeing to ASM’s claim to sell assets to pay dividends and offer a share buyback to reduce the NAV discount.

• NetEase’s first quarter earnings highlighted the company’s ongoing growth, driven in large part by its game portfolio.
• Net revenue for Q1 rose to RMB 26.9 billion, marking an accelerated YoY increase led by the company’s diversified game offerings.
• There was significant growth from established game franchises which have managed to maintain high popularity among their user bases, showcasing the sustainability of the company’s games.

• Atour reported C1Q23 revenue 4.6%/6.8% higher than our est./cons., and non-GAAP NI 6.9%/8.8% higher than our est./ cons, driven by hotel expansion and new retail products.
• The company raised total revenue guidance from 30% to 40% YoY for 2024 due to a strong retail sales trend. 
• We believe retail sales is a form of increase in Atour’s same store sales. We thus raise TP to US$39 to reflect this retail-driven increase of same store sales.

• The majority of its revenue comes from selling float glass, which is used in buildings and construction. 
• The Chinese government has started home ownership relaxation that will reinvigorate the real estate market. 
• It is still trading at 67% lower to 3 years ago. 

• With Indian capital markets booming, companies are tapping capital markets regularly for fundraising even though they have recently raised funds.
• There are also cases where company after concluding IPO in recent years are going for fund raise
• The market are jittery about possible equity dilution and unclear fund raising objectives

• PDD Holdings Inc., an innovative online retail company based in China, seems to show a strong future trajectory based on its first quarter 2024 earnings conference call.
• The company surpassed its year-on-year growth with total revenue reaching RMB 86.8 billion, marking a 131% increase.
• This impressive growth serves as a testament to PDD Holdings’s efforts to deepen its access and widely influence the consumer market.

• April monthly data on pre-tax income shows slowing YoY growth compared with YTD growth
• NIM pressure was severe in past six months and this can be a key driver of less profit growth
• Credit costs in decline supported net profit delta, but this may not longer be sustainable

• Alibaba Health Information Tec (241 HK) operates an online platform for healthcare services and products.  Post COVID the company has maintained and grown it the online healthcare market.
  
• The company which is 53%-owned by Alibaba Group Holding (9988 HK) , recently reported results for 2023 which beat analyst estimates, recording a 65% increase in net profit.
• The company recently bought AJK Technology from Taobao which gives Ali Health  operational rights for advertising of online healthcare merchants on Tmall (Alimama).

• Automotive revenues for Q1CY24 amounted to $603 million, up 35% YoY. This compares to MobilEye’s revenue of $239 million, down 48% YoY
• Automotive design-win pipeline is now $45 billion, up from $30 billion less than two years ago
• CEO Amon said “Every time we enter a new market, we end up building a very strong position”. That’s a shot across the bows for Intel and AMD…

• Market Largely Influenced by Macro Trends and Nvidia Movements This Past Week
• Key Events: Computex, Apple WDC, Key Taiwan May Revenue Releases
• Apple (AAPL US) Is Overhauling Siri In Order to Create a Beautiful Voice-based AI Interface for the iPhone

• NVIDIA Corporation is on track to become the largest company in the world, purely on the basis of its leadership in the artificial intelligence (AI) and graphics processing units (GPU).
• The company, reported its first quarter earnings of the fiscal year 2025.
• The company generated record revenue of $26 billion which is sequentially up by 18% and YoY up by 262%, significantly surpassing its estimated outlook of $24 billion.

• Founded in 1881, Oki Electric Industry Co., Ltd. manufactures electrical and communications equipment, ICT equipment, and systems that utilize these products.
• In FY03/24, OKI reported full-year consolidated sales of JPY421.9bn, operating profit of JPY18.7bn, recurring profit of JPY18.3bn, and net income of JPY25.6bn.
• OKI Electric Industry Co., Ltd. announced that it expects to record income taxes–deferred in its consolidated and non-consolidated financial results for FY03/24.

• Zoom reported total Q1 revenue of $1.141 billion, a 3% year-on-year increase.
• Enterprise revenue, which represented 58% of total revenue, grew 5% year-on-year.
• Gross margin was 79.3%, slightly lower than the 80.5% recorded in the same quarter last year due to investments in AI innovation.

• Action Construction – a leader in construction and heavy equipment theme is going for transformation with a defence foray and new product launches
• With strong guidance and the historical success of good execution makes a good bet on the current infrastructure and manufacturing theme
• The risk includes a slowdown in the election period and stiff competition from larger players

• We hosted a conference call recently with Himax management, the global leader in automotive touch display controllers; the company is experiencing a uniquely stronger automotive supply/demand environment than some peers.
• Discussed in detail how larger or more sophisticated interior displays can drive higher dollar content of display controllers per vehicle. We examine trending new car designs with much larger displays.
• We forecast an exponential jump-up in display controller content value per vehicle as beautiful display designs are becoming key USP for auto brands; Maintain our Structural Long rating for Himax.

• Sumber Alfaria Trijaya (Alfamart) booked a solid set of 1Q2024 results, a testament to its resilience during an election period, with the seasonal impact of Lebaran. 
• Minimarkets continue to be the winning format in Indonesia and Alfamart continued to gain share during 1Q2024, neck and neck with Salim-backed Indomaret if you include Alfamidi, Lawson, and Dan+Dan. 
• Alfamart will slow store openings to 1,300 stores this year after adding more than 1,800 outlets in 2023, with growth prospects remaining positive and profitability intact with a 25% ROE. 

• Groundhog Tech focuses on expanding 5G in SE Asia to drive growth in the region’s tech industry
• Skymizer introduces ET2 LPU and LLM system platform to enter the chip IP market and enhance its offerings
• Samsung increases staff at Japan lab for chip packaging innovations, while Malaysia plans to invest in chip ecosystem development

• Legend Holdings Corp H (3396 HK) owns 31% of Lenovo (992 HK) , the number one global PC maker
• Lenovo is a leader selling AI enabled PC’s globally.  Its server business is growing rapidly through strong demand for generative AI.  Legend is the leading AI seed investor in China.
• Technical pattern strong for Lenovo reaching a 9 year high.  Legend showing increasing momentum from an historic trough valuation level

• BQE reported Q1 financial results yesterday where the highlight was 114% YoY growth in its recurring operation services segment.
• Technical services revenue was weak however, leading to a slight miss on proportional revenue ($3.4M vs. $3.8M expected) and margins.
• Management’s outlook remained bullish, expecting operation services revenue continuing to grow rapidly and technical services revenue catch back up in H2.

• Zscaler missed billings estimates and lowered full-year revenue guidance due to extended sales cycles and deal closures delays
• Declining performances in the cybersecurity sector indicate potential underperformance for Crowdstrike
• Author predicts potential significant miss in Crowdstrike’s upcoming earnings based on current trends in the market

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.

• A high disease burden, high demand for chronic treatment, and an ageing population makes China an excellent opportunity for an established pharma company.
• A transition period following the inclusion of four large drugs in the NDRL creates an opportunity following a big de-rating.
• With 1/3 of the market cap in cash, a healthy payout ratio, and a FPE of under 8, CMS is one of the bargain beneficiaries in the Chinese healthcare space.

• Anticipate significant downward revision in Arlo Technologies’ long-term revenue guidance
• Management’s lack of transparency regarding key performance indicators may have misled investors
• Initiate a short position before Feb. 29th guidance update to benefit from potential share price decline.

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.

• VAALCO has brought online four new long (2.75 mile) lateral wells in Canada.
• Three wells delivered IP rates of 500 bbl/d while the fourth well flowed 350 bbl/d for a total production capacity addition of 1.85 mbbl/d.
• This is a good result and compares with individual IP30 oil rates of 374-444 bbl/d achieved at the two wells drilled in 2023.

• China announced game approval for the May batch. The number of games approved remained at a higher level than 2023.
• The pace of China game approval appears to have accelerated to the same level as pre-tightening, though the number of approvals appears to be slower than March.
• None of the listed companies that we followed received approval for mobile games.

• Cisarua Mountain Dairy booked a strong set of 1Q2024 results, with sequential quarterly growth in revenues and more so profits as margins recovered driven by both dairy and consumer foods. 
• The company ramped up its advertising, promotion, and marketing spending as it launched new products in the more affordable segments including new flavours for stick yoghurts and affordable consumer foods.
• Cimory remains optimistic for 2024 for a more pronounced recovery in dairy as it pushes out products into general trade and takes more shelf space in modern trade driving growth.

• Chinese outbound travel demand continued its gradual recovery in April 
• Moderating domestic demand? It’s not new, and outbound matters more 
• On a pullback to below US$50, we would again BUY Trip.com’s ADRs

• Nvidia switches to FOPLP for AI server chips to alleviate CoWoS capacity strain, improving efficiency and performance.
• Taiwanese banks embrace GenAI despite challenges, as revealed by a McKinsey survey highlighting growing adoption in the industry.
• European carmakers forge partnerships across continents to compete in the affordable electric vehicle market, focusing on collaboration and innovation.

• Boss Energy, an Australian uranium producer, saw a significant drop in stock price following the sale of shares by three directors.
• The directors sold a substantial amount of their stock, representing 83%, 63%, and 63% of their ordinary shareholdings respectively.
• The high volume of trading on the stock on the day of the sale has raised concerns about the timing and implications of the director’s actions during a critical phase of the company’s life cycle.

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

• We hosted a conference call recently with ChipMOS management; the company continues to view 1Q24 as having been the bottom for the memory and display markets.
• Memory customers are increasing utilization further. Since ChipMOS does not significantly serve the HBM DRAM market, this indicates that previously softer non-HBM memory segments are now showing improvement.
• Display industry increasing utilization on expectation for 2H24 large display demand strength driven by sporting events such as the Paris Olympics. ChipMOS remains well below March highs, rate as Outperform.

• Ally remains confident in their ability to navigate challenges with a focus on pricing and underwriting discipline
• Ally’s strong capital position and strategic focus on digital banking position them well to benefit from potential economic recovery and rising interest rates
• Author believes Ally’s stock has significant long-term growth potential and could triple in value, with limited downside risk in the short term

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.

• Tong Yang Industry is now seeing record profit in FY23 and this appears to be in place to continue during FY24
• The automobile and motorcycle parts manufacturing company is seeing strong growth in the US market
• Electric vehicle parts R&D is well underway and this should support continued growth in coming years

• Part of our housing finance checks, we have been visiting Aavas Financiers Ltd (AAVAS IN)  branches for over two years now.
• While the situation was grim early on post the management change and increased competitive intensity, the current channel inputs are encouraging.
• Key areas that warrant attention are growth trajectory, yields, and tech upgrade. 

• RaaS Research Group has published an update report on diversified financials company Bell Financial Group (ASX:BFG) following the company’s presentation at the Bell Potter Emerging Leaders’ Conference yesterday.
• An April YTD trading update provided at the conference points to revenue growth of 23% and Profit After Tax (PAT) growth of 135%, an acceleration on Q1 CY24 Profit Before Tax (PBT) growth rates provided at the AGM, with all divisions profitable.
• This compares to a RaaS H1 CY24 PAT growth estimate of 90%, placing the group on track to achieve our H1 estimates.

• Akatsuki Inc (TYO 3932) is a net-net Japanese video game developer with 10 years of profitability.
• They’re undergoing a big transformation in an effort to better compete globally by investing enormous amounts into their core development capabilities and increasing their average budget per game 3-6x.
• They recently formed a capital alliance with Sony (6758) and Koei Tecmo (TYO 3635) with each taking a 10% and 8% stake respectively.

• Samsung aims to revolutionize memory technology by launching 1,000-layer 3D NAND by 2030, utilizing innovative materials for enhanced performance.
• Lenovo expands its market reach with AI PCs targeting a global audience, but faces stiff competition amidst concerns over Indian restrictions on imported PCs and notebooks.
• TSMC’s collaboration in Taiwan on 7nm tech brings together academia and industry, while China, Japan, and South Korea look to strengthen supply chains at a summit for mutual benefit. Samsung aims to increase its presence in China through collaboration.

• As one of the fastest-growing economies globally, India is projected to become the third-largest economy, trailing only China and the US, by 2027.
• Amid macroeconomic challenges worldwide, investors are eager to tap into India’s robust economic growth.
• However, economic growth does not always correlate with equity market growth, as seen in Spain and Italy during the 1980s and 1990s, and more recently in China.

• Disputable Phase III result of Akeso’s (9926 HK) flagship pipeline Ivonescimab (AK112) caused Akeso’s share price to drop 28% in three days, reaching the bottom of a year-long trading range;
• The fundamental difference of opinions is around Ivonescimab’s global prospects against (1) Merck’s Keytruda, (2) J&J’s Rybrevant, (3) Kelun’s SKB264 and domestic prospect against (4) Innovent’s IBI305;
• Some answers are clear while others are now. What can provide answers are (1) SKB264‘s Phase III data, and to a lesser degree (2) AK112’s head-to-head trial against Keytruda.

• LY (4689 JP)‘s Yahoo Shopping looks to be in trouble after five straight quarters of negative growth while Amazon and Rakuten move ahead.
• Despite a revenue increase in 4Q2023, Yahoo Shopping continues to struggle with merchant fraud and a lack of a clear USP.
• If effective integration between the many parts of LY is not forthcoming soon, the company may eventually attract demands for better synergies, as well as a stick-wielding Softbank.

• UMC is currently forecasting a flat to low single digit growth QoQ for 3Q24, which is slight lower than consensus.
• UMC has received orders from domestic and international clients. However, we believe it couldn’t be able to compensate for the loss of Samsung’s 28nm orders so far this year.
• With accelerated construction in Singapore in 2024, the full-year capital expenditure has slightly risen to $3.3 billion.

• The OBA-1 well onshore Morocco has encountered an approximate 70 m gross interval containing elevated resistivities coincident with elevated mud gas readings, indicating potential gas pays, with no water-bearing reservoirs identified.
• While the approximate 200 m gross thickness for the reservoirs is in line with pre-drill expectations, the absence of water in the 70 m gross interval is particularly encouraging and could suggest larger than expected resources (12 bcf pre drill).
• The well is now expected to be tested in 3Q24.

• Lengthening order lead times impacting revenue recognition – Q1-3 FY6/24 results were behind expectations in our view, with sales declining 27.6% YoY.
• Whilst a negative optic, the reason stems from lengthening lead times for shipment, given customer demands for more high-end and exacting technical requirements for custom-made products requiring more time for delivery.
• We believe this highlights the value-added technical expertise of the company and delays in revenue recognition. 

• Virtuoso Optoelectronics (VOEPL IN)  is a contract manufacturer company engaged into production of ACs, Lightings and other equipments. The company is renowned for supplying ACs to Voltas.
• The company has grown sharply over the last five years and has been engaging in constant capex. However, it does struggle in converting its earnings to cash.
• Among the forensic checks, it nets off receivables and payables/advances, the exact nature of these line items cannot be commented upon. VOEPL also faces high cost of borrowings

• ADF announced a series of new contracts totalling $90M spanning the pharmaceutical, industrial, and public infrastructure sectors.
• This includes additional work awarded for the pharmaceutical project in the Midwest U.S. which ADF was recently awarded phase 2 for.
• ADF will be reporting Q1/25 on June 11th, we are expecting $90.1M revenue (12% YoY), 23.5% gross margin, and $17.2M EBITDA (19% margin).

• Baidu’s revenue growth for the first quarter exceeded expectations, with a year-over-year increase of 4%, reaching RMB 23.8 billion.
• Additionally, Baidu’s continued efforts in Gen AI path have resulted in a 12% year-over-year acceleration in the revenue growth from Baidu AI Cloud, which also delivered an operating profit on a non-GAAP basis.
• These positive results signify the company’s successful transition from an internet-centric business to an AI-first business.

• Liquid cooling market expected to double by 2025, but industry shakeout predicted by Auras chair.
• Apple plans to ship over 9 million units of OLED iPad Pro, aiming to boost its market presence.
• South Korea aims to enhance its IC design sector, currently holding just a 1% share of the global market.

• Microsoft last week launched their CoPilot+ PC category which enables their CoPilot to run locally on your PC, as long as it has an NPU with >40 TOPS
• With Qualcomm being the only one currently offering such an NPU, their Snapdragon processors will be powering the first wave of CoPilot+ PC’s
• It’s an extraordinary accomplishment for Qualcomm & likely an inflection point for Arm powered PCs. It’s also really bad news for Intel and not great for AMD

• JD.com, a China-based multinational technology conglomerate, has announced its first-quarter results for 2024 in an earnings call and reported robust profit and revenue growth, along with an encouragingly high Net Promoter Score (NPS).
• The revenue growth was accelerated by strong execution amidst evolving industry dynamics, improved user experience, price competitiveness, and platform ecosystems.
• Importantly, the general merchandise and supermarket category recorded a notable jump in terms of gross merchandise value (GMV) and revenue growth.

• An overlooked old economy sector in Asia ripe for a comeback
• Industry dynamics will provide  a long-term tailwind for the company
• Opportunity created by  deletion from an index and corporate restructuring

• Impending block deals which generally create supply over-hang on the stock leads to a negative impact on the stock
• These block deals generally include selling promoters and big funds at a price discount to its current market price
• Historically, such events suggest once the block deal is done; stock reacts positively creating a Special Situation Opportunity

• iQIYI, an innovative market-leading online entertainment service provider in China, delivered robust first-quarter 2024 results, achieving numerous record highs, such as non-GAAP operating income and its corresponding margin.
• CEO, Mr. Yu Gong, shared that the expanding margin could be attributed to the high-quality growth of the company.
• The Membership Services business continued its growth trajectory with monthly ARM observed an all-time high.

• The music industry in the west focuses on speculative assets and bundling services, while in Japan firms have 360-degree deals with artists.
• Amuse, a major player in the Japanese music industry, historically managed the successful band Southern All Stars but has diversified beyond them.
• Despite still having concentration in top acts like Masaharu Fukuyama, Amuse’s business model and intrinsic value are seen as attractive to 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.

• Take-Two Interactive Software Inc reported a healthy performance for the fiscal fourth quarter of 2024 with net bookings of $1.35 billion.
• The fiscal year 2024 saw net bookings of $5.33 billion.
• The performance for the period was attributed to the success of NBA 2K24, Zynga’s in-app purchases, Match Factory!, the Red Dead Redemption series, and the Grand Theft Auto series.

• Genel Energy is a high-risk arbitration opportunity with potential for significant reward due to its legal dispute with the Kurdistan government
• Despite previous market capitalization reduction in the 2014 oil crisis, Genel Energy is now an undervalued asset with strong cash position and minimal debt
• With current market cap at £210 million and significant cash reserves, the company has notable potential for growth, but the unpredictable nature of the situation makes it difficult to model or quantify with certainty

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.

• TSMC’s Latest 2024E Industry Guidance Provided at Symposium in Taiwan
• More Potential Details on Nvidia & Mediatek’s AI PC Chip to Compete with Qualcomm & Intel
• Samsung’s HBM DRAM Chips Face Challenges in Meeting Nvidia’s AI Requirements

• Vanguard should declare to established 12″ Fab in Singapore within 2014.
• Vanguard is likely to announce the establishment of 2 sets of 12″ fabs in the next 6 months.  
• China is expanding 28/22nm and above technologies, and we believe it’s more appropriate for Vanguard to compete with others rather than TSMC.

• The NHSA issued a Notice on “improving the quality and expanding the scope of VBP”. The trend of full coverage of VBP of conventional drugs/consumables is determined.TCM is under pressure.
• We analyzed the potential demand growth rate of the glove industry, which is already better than most cyclical stocks. Therefore, we see no need to remain pessimistic about this industry.
• Holding platform companies have valuation discounts.HK$50-60 billion is reasonable market value for China Resources Pharmaceutical.Better to go long when share price is below HK$5 and then hold to receive dividends.

• Since late 2020, Search’s share of digital advertising revenue has stabilised at around 8-10%, seemingly retaining its core advertising customers and industries.
• Baidu management expects AI Cloud to maintain strong revenue growth momentum in the upcoming quarters.
• Baidu trades on a 3.6x NTM EV/EBITDA multiple, well below one standard deviation lower than its 5-year historical average trading range and the lowest it has ever been.

• Our index shows April pricing momentum remained positive in deep-sea trades
• Evergreen Marine posted strong revenue and earnings growth in Q124
• Container carriers have performed well YTD in 2024; we expect convergence

• In 1Q24, Revenues of Xpeng, Tongcheng, Kanzhun, and Gaotu grew by 62% YoY, 50%, YoY, 43% YoY and 34% YoY.
• KE’s revenue decreased by 20% YoY in 1Q24 due to the weak property market.
• Bilibili’s value added services revenue grew by 17% YoY and advertising revenue grew by 31% YoY.

• Recommendation to buy ISEC shares at Rs 840 per share with a price target of Rs 1200 per share
• Dissatisfaction among minority shareholders due to insider’s attempt to acquire remaining shares at a lower price
• Illiquidity and limited institutional investors due to Parent owning 75% of shares, potential merger poses a risk but shareholders can extract fair value even in a merger scenario

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.

• Pluxee is a spin-off company with a strong business model, offering an attractive investment opportunity.
• The company’s undervalued stock price and potential for growth make it a compelling choice for investors.
• With large insider ownership, new initiatives, and the Bellon family as controlling shareholders, Pluxee is expected to see improvements and long-term success.

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.

• Warby Parker disrupted the eyewear industry in 2010 with affordable prices and innovative styles, known for their commitment to social impact
• The company has faced challenges with slowing growth and increased competition, leading to concerns about its uniqueness and disrupter status
• Critics believe that Warby Parker’s focus on technology and business model changes indicate a potential decline, making it a target for short selling.

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.