Financials

• Ping An Insurance (601318 CH) trades at a 40% premium to Ping An Insurance (2318 HK). The premium has blown out the last week and there could be a reversal.
• The difference in Ping An’s AH premium versus the HSAHP Index has shrunk to its narrowest level in the last 10 years.
• Shareholding in Ping An Insurance Group of (601318 CH) via Northbound Connect has dropped and shareholding in Ping An Insurance (H) (2318 HK) via Southbound Connect has increased steadily.

• HDFC Bank reported earnings last week. The next day the stock fell 8% followed by another 4% the day after.
• HDFC Bank is one of India’s bluest blue chip stocks with a reputation for being a high quality compounder.
• What happened and where do we go from here? First, some lessons from another life.

• The previous week was packed with deals, IPOs, and other SPAC-related events.
• Four new deals were announced, including SPACs taking a conglomerate, an eVTOL company, and Korean and Chinese Biotech firms public.
• Also, a new SPAC priced its IPO, and SPAC rules could come under the microscope in the week ahead when the SEC meets. 

• The S&P/ASX 200 INDEX closed last week down at 7421.20 (CC=-1). The index was rallying in the previous weeks, but then pulled back before reaching the previous all time highs.
• The next strong support for a LONG trade is 7288 (Q3 support), but there is a risk of a slide to lower levels, so hedge your LONG trades.
• This looks like a temporary correction (buy-the-dip opportunity to add LONG positions, or to re-enter LONG at better prices).

• Activia Properties (3279 JP) announced results Wednesday. Higher DPU on better rental income looks to continue next period, but an asset disposal will produce some drag ahead.
• Activia Properties also announced a buyback of 10% of ADV for the next four months.
• The REIT is slightly cheap to peers. Yield spread to JGBs is high which is good. It needs to be 10% higher to restart accretive equity offerings.

• Dai Ichi Life Insurance (8750 JP) has seen rebounding net profit at a strong rate of growth for the past four quarters.
• ROE has moved from a dismal 3.4% to 11.8% from 2Q23 to 2Q24, where a single US bank impairment should now drop out of the numbers
• New business annual premiums are up from JPY97bn to JPY122bn from 2Q23 to 2Q24 with a high solvency ratio of 654%

• Chinese property developer Country Garden Holdings Co. Ltd. vowed to deliver more than 480,000 homes in 2024, a more modest target than 2023 after it failed to achieve its 700,000-unit goal last year.
• The focus of 2024 is still to “guarantee delivery, guarantee operation and guarantee credit,” of which delivery is the bottom line that Country Garden “must firmly hold,” Chairwoman Yang Huiyan said at the developer’s annual meeting Monday.
• Country Garden, once China’s No. 1 developer by sales, delivered more than 600,000 units last year, short of its goal set at the beginning of 2023, the developer said.

• Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
• We assess Axactor’s ESG as “Adequate”, in line with its “Adequate” Social and Governance scores. The company has a “Weak” score for the Environmental pillar. Controversies are “Material” and Disclosure is “Weak”. 
• Axactor is a Norway-headquartered debt purchaser and servicer founded in 2015. Its core business is the purchase of non-performing debt in the Nordics, Spain, Germany and Italy.

Key points (machine generated)

• FCFS has a strong growth potential with an estimated 6% to 12% growth.
• The company has a well-diversified business model, with pawn shops in both the US and Mexico, indicating a strong cash flow generation.
• FCFS benefits from serving the underbanked population, providing a stable customer base and making it a solid investment option with a track record of outperformance and potential for future growth.

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.

• Last week at Close the NIFTY Index was OVERBOUGHT, this week it became quickly OVERSOLD, bouncing off from a price area near the Inner Fence support  levels for CC=-1.
• Another week down is possible but we see strong support in the 21250-20800 price area.
• Should that support area be reached, it would be a good opportunity to re-enter this index’s Bull market.

• In this note, we will look at the Asia Pacific IPO pipeline for 2024, following up with ASEAN and ANZ after having looked at other regions earlier.
• This list has been compiled on a best effort basis from tracking the company filings and through various other sources
• The deals you see in this note are only a part of our full IPO pipeline tracker. Feel free to drop us a message for additional information on these IPOs.

• HDFC Bank’s (HDFCB) stock was down over -8% yesterday and is down over -3% today. The stock seems to have reacted to low deposit growth (~2% QoQ) in Q3FY24 .
• Post the merger with HDFC Ltd that completed in Jun 2023, HDFCB needs to grow its deposits at a fast pace to support its loan growth.
• We think HDFCB is well placed to do so. It also has an option to raise capital through affordable housing bonds which have good economics, similar to term deposits.

• We explore twelve Japanese regional banks to look for key beneficiaries of the improving interest rate outlook, along with valuations, credit quality and capital adequacy
• The global interest rate outlook is in some flux, with the Fed’s and ECB’s prospects of near-term easing being tempered; this should support Japanese JGB yields and domestic bank valuations
• We are positive on three banks that are big beneficiaries of rising domestic interest rates; top pick Tokyo Kiraboshi Financial, Gunma Bank and higher risk option Suruga Bank

• Reforms Drive Improvement: Japan’s corporate reforms, catalyzed by governance codes and TSE pressure, are fostering capital efficiency, shareholder value, and long-term equity gains.
• “Name and Shame” Initiative Impact: TSE’s disclosure initiative reveals 54% of Topix 500 companies enhancing capital efficiency, with early indications suggesting positive longer-term performance trends.
• Future Alpha Opportunities: Expectation of increased disclosure in the coming months, particularly from proactive companies; potential for market surprises from obstructive firms trading below book value.

• The cryptocurrency industry is still buzzing with excitement after the recent approval of 11 Bitcoin spot ETFs last week.
• As these ETFs have been trading for a week now, their current performance and net inflows are now available for our consumption.
• This analysis will focus more on visual charts and less on text, a departure from my usual style, as the market seems to have had its fill of lengthy discussions on ETFs, which now feels akin to listening to a repetitive story from a friend or, even more tiresome, your mother-in-law.

• Axis Capital is a 100% subsidiary of Axis Bank Ltd (AXSB IN) and one of its businesses is structured finance
• The Sojo Infotel is a high-risk transaction undertaken by Axis Capital which was underwritten by the company with the implicit support of the bank as per the credit rating agency
• When the transaction was done it was 50% of Axis Capital’s equity and default risk is high as the redemption date is on March 25, 2024

• HSBC holds 19% of BoCom and still carries it with a value of USD23.3bn despite the stock market valuation putting it closer to USD8.1bn on YE22 figures.
• The bank cites its Value In Use testing as the justifiable reason for this gap, and this testing will include major assumptions like discount rates and long term growth rates.
• Goodwill and other intangible charges were USD10.6bn in FY08, USD3.4bn in FY16, and USD7.4bn in FY19 for HSBC.

• The S&P 500 INDEX at the moment has lost its momentum and is pulling back towards the Q2 (4751) and Q3 (4713) support levels, where it would be DAILY OVERSOLD.
• A DAILY reversal could happen today or tomorrow from prices between 4750 and 4700.
• This trade is a quick scalp, the goal is to profit from a 1-bar reversal, after that we cannot predict the market direction, so caution is advised.

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

• Yanlord Land

• PICC P&C’s Q3 underwriting profitability deteriorated due to typhoon/catastrophe-related losses in both motor and non-motor business.
• Samsung Life’s new business growth momentum continued in Q3’23; new business CSM margin slightly improved QoQ.
• Prudential disclosed limited details in its Q3 results but we can see the growth trend of new business volume and profits continuing in the quarter.

• LuxUrban Hotels (NASDAQ: LUXH) is a Miami-based hotel lessee and operator.
• Founded in 2017, LuxUrban (then called CorpHousing Inc) initially focused on the short-term corporate housing market, leasing and then re-leasing houses to business travelers.
• The pandemic severely impacted demand in that market and in 2021 LuxUrban exited the corporate rentals space.

• This is our first report on Freshworks Inc, a renowned customer service software player.
• Increased free cash flow along with a rise in the free cash flow margin to 14% likewise surpassed estimates.
• In this report, we have carried out a fundamental analysis of the historical financial statements of the company.

Having previously updated on Picton Property Income’s H124 results, we are re-instating forecasts following the cessation of merger discussions with UKCM. In a challenging environment, H124 financial performance was resilient, supporting fully covered DPS. Meanwhile, the company continues to believe that there are strategic and financial benefits to combining complementary businesses, particularly within an internal management structure, including economies of scale and enhanced earnings.

• Total impairment costs are soaring now at Citigroup up to USD3.5bn in 4Q23 compared with an average charge of USD1.8-1.9bn in the recent preceding quarters.
• Net interest income appears to be topping out now, as there is generally a lagged impact on funding in a rising rate environment.
• The implications of the Citi results, steeped in geopolitical risk, are not positive for large global banks, major US banks in particular and HSBC Holdings (5 HK) specifically.

• State Bank Of India (SBIN IN) is the best-performing PSU bank in India and shows clear convergence with private peers across fundamental metrics beyond what its valuations might suggest
• Medium-Term ROE Forecast of 16% to 18% and loan growth forecast of 14% to 16%; ROA ~1.2% consistently; Strong fee income; successful cross-selling through subsidiaries; Strong asset quality.
• P/BV is cheap at 1.3x FY25e, compared private peers’ valuations of 2.5x to 3.0x. SBIN can potentially re-rate to P/BV of ~1.6x FY25e in the near term (~35% upside).

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

• Lippo Malls Indonesia Retail Trust

Key points (machine generated)

• Significant investment in insurance companies, particularly niche providers, has been seen since the Covid pandemic.
• The S&P Insurance ETF has outperformed the SPY by 25% over the past 3 years, indicating the success of these investments.
• Despite their growth in intrinsic value, the share prices of many insurance companies are not reflecting this, possibly due to overlooking the potential impact of higher interest rates on future profitability. However, some companies have managed their investment portfolios prudently and are in a favorable position.

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.

• The TSE’s new efforts to encourage companies to disclose measures to improve their capital efficiency and stock prices correlate closely with general indicators of good governance.
• Over 60% of companies that we classify as “Proactive” have already disclosed their status, while only around one third of “Obstructive” companies have done so.
• Companies with higher levels of Board Independence and that are more aligned with shareholders are more likely to be better allocators of capital for long-term growth.

• The German Government is planning to reduce its stake in private companies (100+), which is reviving the talk of a merger between Commerzbank (15.75% owned by Germany) and Deutsche Bank.
• In case of a (logical) all-share merger, the German Government would just exchange a 15.75% stake in Commerzbank for a smaller one in the New Deutsche Bank (estimated ~5.75%).
• The most likely outcome is an accelerated book build among institutional investors (as the British Government has done with Natwest, formerly RBS, in the past), in my view.

• The last week was packed with activity from SPACs ranging from Deals to LOIs and Lawsuits.
• A SPAC will take a holding company public while a blank-cheque firm signs a letter of intent to take an AI-focused company public.
• Also, a SPAC filed a suit against an investment firm and fintech De-SPACs outperformed their IPO peers in Q4. Read on to find out the latest about all things SPACs.

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

• Vedanta Resources

• Some stocks have continued to underperform the Nikkei 225 (NKY INDEX) and their peers and could be deleted from global passive portfolios next month.
• Stocks that were expected to be deleted (but could now be safe) have outperformed the Nikkei 225 (NKY INDEX) over the last couple of weeks.
• There has been two-way flow in a lot of stocks with market participants increasing and covering short positions as the stock prices have moved around.

• The NIFTY Index closed up last week (CC=+1), it is not overbought yet but it could become so at the end of this week (Friday).
• Resistance begins at 22280/22800, these are the price areas from where SHORT trades can be initiated (target: 1 weeks reversal, close trade at Close).
• Covering LONG holdings with Covered CALLs is also possible, Strikes should be =>22800.

• In this note, we will take a look at broker performance for ASEAN IPOs and placements in 2023. 
• The following dataset includes all ASEAN IPOs and placements above US$100m, which amounted to a total of 18 deals.
• The deals you see in this note are based on our historical IPO and placement tracker. Feel free to drop us a message for additional information.

Key points (machine generated)

• Goeasy is a Canadian company specializing in sub-prime lending, serving individuals with low credit scores as a lender of last resort.
• The company offers various credit products with interest rates ranging from 9.9% to 46.9%.
• Goeasy operates in a niche market with significant growth potential as approximately 8.5 million Canadians are classified as non-prime borrowers.

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.

• The Nikkei 225 INDEX experienced a 1-week explosive rally, last week, reaching nearly +6.6% higher than the previous week’s Close.
• The index is now very overbought, can it continue to rise next week? and and how much higher can it go?
• Go SHORT in the 36000-38350 price area, but the trade is not without risk.

• Aflac delivered an all-around beat in the previous quarter, with a notable 12.4% year-over-year increase in sales in Japan.
• The Japanese market’s success is attributed to a significant surge in cancer insurance sales, particularly through collaborations with Japan Post Company and Japan Post Insurance.
• As the company continues to strengthen its market position, the commitment to prudent liquidity and capital management remains unwavering.

• The Allstate Corporation managed to exceed analyst expectations in terms of revenue as well as earnings.
• In the third quarter, they reported a noteworthy 9.8% increase in revenues, totaling $14.5 billion, with a notable $1.3 billion surge from the previous year.
• The merger also presented an opportunity to consolidate Allstate’s voluntary benefits business with National General’s group and individual health businesses.

• ICGT’s discount, like most of the listed PE sector, is well above historical averages.
• We also consider how the triggers to a potential re-rating have evolved in the recent past and are likely to evolve in the near future.
• While many of these factors apply across the PE industry, we explain how ICGT’s position, portfolio and strategy mean it is uniquely well positioned in this environment.

• Prudential Financial delivered mixed results for the previous quarter, with revenues well below analyst expectations, but managed an earnings beat.
• The quarter was marked by strategic initiatives to foster higher growth, increased capital efficiency, and operational skills.
• In this report, we have carried out a fundamental analysis of the historical financial statements of the company.

• CSI 300 represents the 300 largest stocks by market capitalization and liquidity from the entire universe of Shanghai and Shenzhen Stock Exchanges. CSI 500 represents the next largest 500 names.
• In this insight, we take a look at the potential ADDs/DELs for the CSI 300 and CSI 500 rebalance in June 2024.
• Since my December 2023 insight, a couple of names have left the CSI 300 Expected ADDs basket and have been replaced by two other names. 

• 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. 

Key points (machine generated)

• Queen City Investments (QUCT) is an illiquid OTC-traded affiliate of Farmers & Merchants of Long Beach (FMBL), a regional bank.
• QUCT has a strong balance sheet with $30 million in cash/treasuries and no debt.
• In 2022, QUCT generated approximately $4.4 million in free cash flow, indicating its financial stability.

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.

• The crypto industry’s big dream has become a reality.
• The US Securities and Exchange Commission (SEC) gave the green light to 11 Bitcoin spot ETFs after the market closed yesterday.
• Notably, this includes approval for BlackRock’s iShares Bitcoin Trust and the conversion of the Grayscale Bitcoin Trust into an ETF.

• Ten fund management companies are preparing to launch spot Exchange-Traded Funds backed by virtual assets in Hong Kong, according to an executive of crypto exchange operator HashKey Group.
• Up to eight of the fund companies are at an “advanced stage” for the launch, Livio Weng, HashKey’s chief operating officer, told Caixin in an interview.
• He didn’t provide any more details.

Key points (machine generated)

• Sygnia Limited is an asset management firm based in South Africa that specializes in low-cost investment products, including ETFs.
• The company was founded in 2003 and became listed on the Johannesburg Stock Exchange in 2015.
• Sygnia currently holds a market share of around 4% and manages R285 billion of the overall market assets under management, making it the 9th largest asset manager in South Africa.

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.