Financials

• In this note, we will take a look at bookrunner performance for Korean IPOs from 2021-2022. 
• The following dataset includes all Korean IPOs above US$100m for the period of Calendar Years 2021-2022, which amounted to a total of 11 deals.
• The deals you see in this note are based on our historical IPO tracker. Feel free to drop us a message for additional information on any of these IPOs.

• In this note, we will take a look at the performance of bookrunners for Korean placements from 2019-2022. 
• The following dataset includes all Korean placements above US$100m for the period of Calendar Years 2019-2022, which amounted to a total of 29 deals.
• The deals you see in this note are based on our historical placements tracker. Feel free to drop us a message for additional information on any of these placements.

Edison Investment Research is terminating coverage on Vivesto (VIVE), Diurnal Group (DNL), Palace Capital (PCA), Primary Health Properties (PHP), Silver One Resources (SVE), Induction Healthcare (INHC) and Axiom European Financial Debt (AXI). Please note you should no longer rely on any previous research or estimates for this company. All forecasts should now be considered redundant. Previously published reports can still be accessed via our website.

Edison Investment Research is terminating coverage on Vivesto (VIVE), Diurnal Group (DNL), Palace Capital (PCA), Primary Health Properties (PHP), Silver One Resources (SVE), Induction Healthcare (INHC) and Axiom European Financial Debt (AXI). Please note you should no longer rely on any previous research or estimates for this company. All forecasts should now be considered redundant. Previously published reports can still be accessed via our website.

• Higher interest rates might reflect positively in Prudential’s Q4 report.
• However, the continued decline in long-dated par rates presents a severe risk to the company’s investment portfolio.
• The company’s stock is relatively overvalued, and its dividend yield is poorly covered.

• Bank Mandiri (BMRI IJ) finished the year with a strong showing of loan growth across the board driven by corporate and commercial loans but micro was also a feature. 
• Both the bank’s consumer app under Livin’ and its digital corporate platform under Kopra continue to help drive CASA growth and transactions plus the bank is opening “smart” branches. 
• Bank Mandiri (BMRI IJ) is optimistic about the outlook for loan growth and NIMs in 2023, with its digital initiatives continuing to gain traction and drive growth. Valuations are attractive.

• Siam Commercial Bank (SCB TB) booked a solid set of 4Q2022 results, with the first NIM expansion in two years and record high net interest income.
• The bank also provided details of its mothership strategy, which has now come to fruition, with the restructuring process now complete with its increasingly strong digital credentials becoming clearer.
• Siam Commercial Bank remains attractive on valuations and probably deserves to trade at a premium to peers given its digital credentials but more data may be required to get there.

• Bandhan Bank Ltd (BANDHAN IN) reported weak earnings with a flat (-2%) Net Interest Income growth and a +91 YoY growth in provisions.
• Additional slippage continues to come primarily from the EEB portfolio. The overall advances recorded is 14% YoY growth driven by the Retail segment, including housing and MSME.
• Improvement in customer behaviour in terms of regularizing accounts is a critical component that needs to be verified and checked for the bank to move ahead.

• At long last — after months of rumours — Sorare and the English Premier League (EPL) have finally announced their exclusive multi-year deal thought to be worth £30m per year.
• For Sorare, this was the final piece to the puzzle. That final big deal in Soccer that they wanted to get over the line.
• Just over 4 years from inception, they now have deals in place with almost every top flight club and league in the world.

• JPX-Nikkei 400 is composed of common stocks listed on the Tokyo Stock Exchange. It is a free-float-adjusted market-value-weighted (capped) index composed of 400 constituents.
• A periodic review is conducted by the Index providers, the JPX Group and Nikkei Inc, in August every year. We look at the potential forward inclusions and removals every month.
• Below is a look at potential Inclusions and Removals for the JPX-Nikkei 400 Rebalance to come in August 2023 based on trading data as of end-January 2023.

• The company has defaulted since 2021 and has already missed a few payments as well as the deadline to deliver a restructuring blueprint at the end of 2022.
• We believe the Chinese government is looking now to rescue developers (such as Country Garden) which are seen as systemically important.  
• We are of the opinion that the sector is not investable for the general public  in 2023 and only the Distressed specialists should endeavor investing in Chinese high-yield property developers.

• Kasikornbank PCL (KBANK TB) remains one of Thailand’s top-tier banks with particular strength in SME lending and consumer lending making it a beneficiary of both consumption and tourism recovery. 
• The bank continues to grow its digital banking and business through its K PLUS app which now has more than 21m users, with multiple use cases and self-apply loan applications. 
• Kasikornbank remains a core holding for exposure to Thailand’s tourism-driven recovery through its SME exposure. Valuations are attractive with the bank trading at 0.7x FY2023 PBV and 8.3% FY2023E ROE. 

• In this note, we will take a look at the performance of bookrunners for ASEAN placements from 2019-2022.
• The following dataset includes all ASEAN placements above US$100m for the period of Calendar Years 2019-2022, which amounted to a total of 54 deals.
• The deals you see in this note are based on our historical placements tracker. Feel free to drop us a message for additional information on any of these placements.

• After last year, XP screens better versus its global wealth manager and broker peer group on most valuation metrics, yet we remain concerned about share overhang and the competitive climate
• Itausa’s NAV discount is narrow, a potential sell signal; Itausa has historically provided discounted exposure to its second largest holding XP, but its XP exposure is now heavily diluted
• The global wealth manager screen indicates that UK wealth manager Quilter stands out for its value attributes, especially on PE, market capitalisation to revenue and AUM to market capitalisation ratios

• The PBOC has extended the use of its policy tools to support the green loan industry as part of the country’s’ drive towards carbon neutrality.
• China’s green loan market is already the largest in the world, if you agree with its definitions and can look past its limitations.
• The state of green finance matters to investors, and not just those with explicit ESG mandates. We look at the potential pitfalls in the China.

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.

• In this note, we will take a look at bookrunner performance for ASEAN IPOs from 2019-2022. 
• The following dataset includes all ASEAN IPOs above US$100m for the period of Calendar Years 2019-2022, which amounted to a total of 41 deals.
• The deals you see in this note are based on our historical IPO tracker. Feel free to drop us a message for additional information on any of these IPOs.

• There are 43 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
• One new deal was discussed on Smartkarma in the past week: MBK and Unison Capital MBO-style Tender Offer for Osstem Implant (048260 KS).
• Key updates took place for: Warrego (WGO AU), Norwest Energy NL (NWE AU), Acotec (6669 HK), Sabana Industrial REIT (SSREIT SP), Jafco  (8595 JP), and Toyo Construction (1890 JP).

• As forecast, DMCI Holdings (DMC) and UnionBank of the Philippines (UBP) will replace Megaworld Corp (MEG) and Robinsons Land Co (RLC) at the close on 3 February.
• The PSE is using float higher than 20% for San Miguel (SMC PM), Emperador (EMP PM) and AC Energy Corp (ACEN) – there will be passive buying on the stocks.
• Historically, the inclusions have outperformed the exclusions and there has been a big move in the stocks the day after announcement. Square off existing pre-positions by mid-week.

• We are lacking short ideas in Asia given we are long most markets. India presents a fresh short idea after failing at trend and price resistance.
• The failure at trendline and 18,200 price resistance was touted as a bearish turn. We have now formed a bear flat that is set to break lower.
• Macro: Remains bullish and we will probe for a long at 17,500/300. 19,470 is our macro bull projection.

• In this note, we will take a look at bookrunner performance for Indian IPOs from 2019-2022. 
• The following dataset includes all Indian IPOs above US$100m for the period of Calendar Years 2019-2022, which amounted to a total of 49 deals.
• The deals you see in this note are based on our historical IPO tracker. Feel free to drop us a message for additional information on any of these IPOs.

• Delta in core net interest income growth is accelerating like no other peer
• Net interest margin’s are now up 50% YoY at a reasonable level of 3.02%
• Credit costs have yet to decline despite NPL ratio down sharply

• Bank Central Asia came through with a strong finish to the year as it took the brakes off lending, with the advantage of the highest CASA amongst Indonesian banks. 
• Loan growth was focused on corporate borrowers, commercial & SMEs, and consumers, with mortgages and autos seeing strong growth in 4Q2022, whilst loans-at-risk continues to decline, boosting profitability. 
• Bank Central Asia is highly capitalised but continues to invest in growth without sacrificing underwriting standards and continues to embrace its digital reach with growing numbers of customers. 

• Krung Thai is our pick; it ranks top in terms of post-provision profitability, as well as screening well on NPL coverage and valuations, including its low PEG ratio
• We also like Ayudhya, with its strong pre and post-provision profitability in 4Q22, strong credit quality metrics and attractive valuations
• Kasikorn has had a difficult 4Q22 due to its high cost of risk and its need to bolster provision coverage; Kasikorn may be a 2023 opportunity, but not yet

• What is Kyber Network and how does it work?
• The relatively old protocol might not be the most popular option with its meager $15 million TVL, but future updates have the potential to turn Kyber into a liquidity hub for the entire DeFi market.
• There are almost too many decentralized exchanges in DeFi, which contributes to a rising problem of liquidity balkanization.

• In December many NPL ratio categories improved MoM, but there are still some areas of concerns namely household and SME credit
• System loan growth for full year 2022 decelerated further (from an annualized 14.7% in November) but still grew by +14%, due primarily to slower consumer loan growth
• New credit spreads declined MoM, along with lending rates implying that this was not due solely to funding costs; we favour Banco do Brasil, and are cautious on Santander Brasil

• Rocket Pool is undoubtedly the most popular name in the arena of Ethereum 2.0 staking pools, but how does it work and is it secure enough for beginners?
• Ethereum 2.0 is here, and everyone is now interested in making profits from their existing crypto assets by staking.
• Ethereum 2.0 is here, and everyone is now interested in making profits from their existing crypto assets by staking.

• Even if the Tether FUD is only typical FUD, we still have to search for other healthy alternatives that help investors with hedging against the market.
• For some, algorithmic stablecoins are the best option and one popular project that stands out is Frax Finance.
• Without a shadow of a doubt, stablecoins are the most boring type of cryptocurrencies.

• Are NFTs more than just pictures issued on a blockchain?
• There must be surely something more to non-fungible tokens, given that one sold for $69 million last week. Not an avid reader? That’s fine.
• You can also learn about NFTs in video format! Non-fungible tokens (NFTs) have, for better or worse, expanded into new territory: mainstream circles.

• Jafco Co Ltd (8595 JP) announced the results of its Tender Offer Buyback today. They wanted to buy 16.8mm shares including 13.9mm from Murakami-san. He sold 9.63mm. Oops. 
• Pro-Ration was 69.25% which means that Murakami entities are still long about 4.276mm shares or 5.83% of shares out. 
• There should be some index selling, and some Murakami Overhang. There may be more overhang at recent prices.

• At TMA we deliver high probability outcomes by focusing on our 3 pillars of technical analysis. 1) Response to key levels. 2) Price action. 3) Momentum confirmation.
• Every recommendation requires definitive evidence of all 3 pillars to be regarded as a high probability outcome. 
• The Nifty Index (NIFTY INDEX) delivered upon our 3 pillars in Nov/Dec 2022. A consecutive down month in January will be further evidence of a likely 15%-18% correction.

• S&P (the company) may be a lot more exposed than S&P (the index) if rates stay higher for longer and bets against the Fed unwind in 2H23.
• While we like the rating agency and financial data provider’s business portfolio, valuation is looking a bit stretched based on fundamental, relative and technical valuation metrics.
• We believe it is unlikely that the stock will push through the USD375/share resistance level in the near term, and would look for entry opportunities closer to USD325/share.

• On Jan 19th we recommended a call and call spread to play upside in the KOSPI2 Index
• Since then the market has rallied 3.75% and has moved through our first strikes
• We look at restructuring the trades to play further momentum

• The EUR/USD exchange rate has been moving upwards, as seen in Graph 1. There were four secondary movements throughout the considered time period.
• More specifically, the currency pair showed an upward movement from November 30th up to December 2nd.
• From 3rd to 12th of December, the exchange rate fluctuated up and down, ending with a higher price range on December 14th.

• On 26 January 2023 we published our bearish multi-month Nifty Index (NIFTY INDEX) outlook. For the RV player, the Hang Seng CEI (HSCEI) is likely to present material opportunity.
• At TMA we place tremendous emphasis on momentum confirmation. Currently, LT momentum triggers confirm a sustainable multi-month to multi-quarter uptrend in the HSCEI.
• Occasionally Fibonacci retracement levels, based off different portions of a trend, coincide. These create high probability targets. 9450/70 in the HSCEI is one such high probability target in 2023.

• Bank Negara Indonesia finished 2022 with a strong set of numbers beating guidance and consensus, as it continued to benefit from low cost of funds and strong loan growth. 
• The bank has increased its exposure to higher-quality corporate customers, and large commercial customers in their supply chain plus growing government-backed KUR loans as well as consumer loans. 
• BNI’s strategy in digital banking for consumers and business customers is driving loan growth and fee income as well as funding. Valuations are attractive with rising returns increasing the appeal. 

• Banorte’s solid 4Q22, and the prospect of a healthy dividend payout, have so far trumped concerns of an earnings downturn from credit spread erosion, higher opex and cost of risk
• Bank sector data trends to November accentuate the return headwinds that we see emerging; further tightening credit spreads and a rising cost of credit, credit cards a likely leading indicator
• BBVA Mexico generates consistent premium ROE of 25%+, investors can gain exposure through BBVA equity; we continue to be cautious on Banorte, due to the growing risks to returns

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.

• Adani Ports & Special Economic Zone
• Azure Power Global Ltd
• Lippo Karawaci
• Tata Motors ADR

• Amidst all of the De-SPAC Bankruptcies, liquidity issues, and frauds, it’s been hard for investors to pinpoint strong, established businesses that deliver consistent returns.
• In fact, only a handful of companies in the three years since SPACs became a popular vehicle retained or saw their valuation increase.
• So it’s good to see businesses like jewelry wholesaler Quality Gold to debut through a SPAC deal.

• In this insight, we take a look at the names leading the race to become ADDs/DELs for the STOXX Europe 600 and EURO STOXX Indices for the March 2023 Rebalance.
• Based on the latest available data, I see five ADDs/DELs for the STOXX Europe 600 Index during the March 2023 review.
• Separately, Electricite De France Sa (EDF FP) and Vantage Towers (VTWR GR) could have index outflows triggered by extraordinary float adjustments before or during the March 2023 review. 

• On Friday, after the close, 5.4% owner of Sabana Industrial REIT (SSREIT SP) announced it had offered to buy another 10.0% in a Partial Offer at a recent high price.
• The Price of the Tender Offer at S$0.465/share matches a recent (and 7-year) high and a 0.88x multiple against June 2022 NAV of S$0.53/share.
• It’s a small deal (US$35mm) for a small REIT (US$350mm) but there’s an activist and an engaged not-quite sponsor, and this would make a third large unitholder in the mix.

• In this insight, we discuss the five most aggressive corporate activist firms that have been moving the Korean equity market in the past year.
• They include Align Partners Capital Management, KCGI, Flashlight Capital Partners, Truston, and LIFE Asset Management.
• Share prices of 15 companies that the corporate activist firms have invested in Korea are up on average 9.7% YTD, outperforming KOSPI which is up 7.1% in the same period.