TMT/Internet

• On 5 June, Shift Up announced that it will be postponing its IPO to July. The original book building period for the institutional investors was from 3 to 13 June.  
• The final book building date has been postponed to 27 June. The subsequent public offering subscription for general investors was also postponed to 2 to 3 July.
• A major investment positive of Shift Up is enormous initial success of Stellar Blade which was the best selling game in the U.S. and numerous other countries in April 2024.

• Sakura internet (3778 JP) is looking to raise US$127m from its primary follow-on. Proceeds will be used towards purchasing GPU servers, and constructing new data center facilities.
• While 11% of total shares outstanding are offered here, the deal would be easily digested by the market, representing just 0.8 days of its three month ADV.
• In this note, we run the deal through our ECM framework and comment on deal dynamics.

• Today, Maxell Ltd (6810 JP) announced its new MTMP “MEX26 – Commit to Value (CorporateValue,ProfitGrowth)” with lots of consultant-speak and corporate homily.
• But they present a capital investment plan, and a capital return plan. These may interest investors. The buyback is the same size as 2019 and 2022. They popped and faded.
• Todays tidbits were all announced during the lunch break today, and the stock popped 6% in the PM session on the news.

• 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.

• Astera Labs announced financial results for 1Q’FY24 in May. According to IPO prospectus, ~5.9M shares became eligible for sale following public release of earnings for the first quarter of FY24.
• The high-growth semiconductor company filed form S-8 on May 8, 2024. The selling stockholders, including current employees and service providers, offered additional ~3M shares as early lock-up expired.
• Astera Labs shares currently trade at rich multiples of ~37x EV/FY24E Revenue and ~25x EV/FY25E Revenue on my revised forecasts.

• When this deal was announced, it was light. But the timing, JSR influence, large-ish float, ensured FUD would make this trade wide. It traded wider.
• Nearly 5mos ago, Shinko had much-underperformed peer Ibiden, meaning downside gap risk from undisturbed was negative as spreads were wide. I reco’d a buy. Then 12wks ago, recommended taking profits.
• Shinko had outperformed Ibiden, gross spreads had narrowed 5+% on JSR approval. Spreads are now 2.6% wider than at narrowest. In May, gap risk narrowed as Shinko underperformed Ibiden.

• MSC indices were rebalanced in the closing auction on Friday. Turnover for the day on the JSE was R41.9bn, R25bn traded in the closing auction (60%).
• Turnover at the February rebalance was R25.6bn. Most SA constituents were pushed lower in the closing auction and for the day, consistent with the downweighting of SA Inc.
• China was downweighted in the ACWI and EM indices for a second straight quarter, reducing the country weight in ACWI by 6bps to 2.69%.

• The HSI added BYD Electronics (285 HK) and deleted Country Garden Services (6098 HK). HSCEI added Zijin Mining Group Co Ltd H (2899 HK) deleted Xinyi Solar Holdings (968 HK) 
• HSTECH had no changes, but lots of flow. The index team sets capping levels, then resets them a three days before the actual rebalancing. There were some capping/recapping changes.
• Below we offer tables showing all the changes and flows across the indices for each stock, ranked by Flows, ADV, and Ticker. And a spreadsheet with all the relevant data.

• Raspberry Pi is expected to raise about £157 million in this IPO. The conditional trading for this IPO is expected to be take place on 11 June.
• We estimate Raspberry Pi to generate sales of US$342.1 million (up 28.7% YoY) and operating profit of US$48.5 million (up 29.3% YoY) in 2024.
• Our base case valuation of Raspberry Pi is market cap of £772 million or £4 per share (43% higher than the high end of the initial IPO price range). 

• 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.

• There are 7 changes for the ChiNext Index (SZ399006 INDEX) and 5 changes for the ChiNext 50 Index at the June rebalance.
• We correctly forecast 5/7 and 7/7 for the Chinext Index adds/deletes and were 3/5 and 5/5 for the Chinext50 Index adds/deletes.
• Based on the estimated passive tracking AUM, the one-way trade across both indices is estimated to be CNY 3.69bn (US$508m).

• The June 2024 index review results for the STAR 50 and STAR 100 indices were announced after market close on Friday 31st May 2024.
• There will be 3 changes for the STAR 50 index and 9 changes for the STAR 100 index.
• We expect one-way flows of approximately US$750mn and US$314mn for the STAR 50 and STAR 100 index rebal events in June 2024.

• 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.

• 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.

• There are 13 changes for the TIP Customized Taiwan Select High Dividend Index in June. The TIP Taiwan Select High Dividend ETF (00919 TW) has an AUM of US$6.4bn.
• One-Way turnover is estimated at 41% and that will result in a round-trip trade of TWD 168.8bn (US$5.2bn). There are 16 stocks that could have over 4x ADV to trade.
• The rebalance will be implemented over 8 trading days and the ETF has started trading the stocks last week.

• There are 3 changes for the SSE STAR50 (STAR50 INDEX) and 9 changes for the STAR100 Index. Implementation will take place at the close on 14 June.
• United Nova Technology (688469 CH) and Biwin Storage Technology (688525 CH) were not added at the March rebalance since they were consistently loss-making. But they have been added this time.
• United Nova Technology (688469 CH) had been trading poorly and then the stock dropped further after non-inclusion in March. That could change now with inclusion confirmed.

• There are 4 changes for the CES China Semiconductor Chips Index that will be implemented at the close on 14 June.
• Biwin Storage Technology Lt (688525 CH) and Beijing Yandong Microelectroni (688172 CH) are also inclusions to other indices too and the multiple flows will increase the impact on the stocks.
• The adds have underperformed the deletes. If things go the way of the December rebalance, a long adds/ short deletes trade could do well from now to implementation.

• 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. 

• 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.

• Snowflake Inc. reported a strong Q1 for its fiscal year 2025, with the CEO, Sridhar Ramaswamy, outlining the key priorities of learning from customers, driving execution within go-to-market teams, and fueling innovation and product delivery.
• The results presented prove that Snowflake’s core business remains robust.
• It delivered a remarkable Q1 with product revenue for the quarter rising to $790 million, a 34% increase YoY.

• The changes to the CSI All Share Semiconductors & Semiconductor Equipment Index were announced after market close on 31 May and will be implemented at the close on 14 June.
• There are 17 adds and 5 deletes for the index.
• The adds and deletes have underperformed the index over the last 6 months but the adds have outperformed the deletes over the last 3 months.

• In Q2 2024, Synopsys’s revenue increased by 15% year over year, aligning it with the high-end expectations of its guided range.
• The non-GAAP operating margin also rose by roughly three points to 37.3%, with non-GAAP EPS increasing by 26% year over year.
• These exceeding outcomes have prompted Synopsys to raise its full-year revenue and non-GAAP EPS guidance.

• During the Analog Devices’ second quarter fiscal year 2024 earnings, the company reported revenue of $2.16 billion, with profitability and earnings per share exceeding expectations.
• The management believes that the business is past the low point of this cycle, with positive signs of improvement particularly in the industrial sector.
• However, there is still economic and geopolitical uncertainty that can potentially impact short-term performance, as such, careful cost and inventory management will be key.

• Workday has reported solid financial performance for its first quarter fiscal 2025, noting a 19% subscription revenue growth and 18% 12-month backlog growth.
• Non-GAAP operating margin is at 26%.
• Despite some challenging dynamics in the quarter, such as increased deal scrutiny and slower customer headcount growth, Workday is encouraged by new go-to-market initiatives that are increasing total addressable market.

• A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
• ECM developments: Shift Up (462870 KS) seeks to raise up to US$320 million.
• Event-Driven developments: Asia Cement China (743 HK), Greatview Aseptic Packaging (468 HK), Huafa Property Services Group (982 HK), Chilled & Frozen Logistics Holdings (9099 JP), Infocom Corp (4348 JP). 

• ZX (9890 HK) will replace Fenbi Ltd (2469 HK) in the KraneShares CSI China Internet ETF (KWEB US) at the close on 14 June.
• There will be over 6 days of ADV to sell in Fenbi Ltd (2469 HK) and we estimate over 2 days of ADV to buy in ZX (9890 HK). 
• There are other ETFs that track very similar indices and there could be a lot more to trade in the stocks at the close on 14 June.

• Bloomberg reports that Blackstone (BX US) has agreed to acquire Teijin Ltd (3401 JP)’s 55% stake in Infocom Corp (4348 JP) at a rumoured valuation of JPY260 billion. 
• The potential minority offer price depends on whether the rumoured valuation refers to market cap or enterprise value and whether Teijin will share TOB tax benefits. 
• The most likely scenario is that the valuation refers to the market cap, with Teijin sharing TOB tax benefits, resulting in a minority offer of around JPY5,720 per share. 

• After CaiNiao halted IPO in late March, company reported lower Q4 margins
• What drove Q4 margin deterioration, retention payments or weaker X-border?
• With IPO off the table, supporting AliExpress becomes CaiNiao’s main role

• 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

• 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.

• 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.

• Global MSCI indexes (MSCI ACWI, ACWI ex-US, EAFE, and EM) are pulling back following recent breakouts to multi-year highs. Europe, Japan also pulling back to uptrend supports.
• Short-Term supports to watch-discussed in our May 23, 2024 Int’l Compass-include $110.50 on ACWI-US, $53.50 on ACWX-US, $80 on EFA-US, and $41-42 on EEM-US; buy this pullback. 
• As long as these supports hold, we anticipate significantly higher prices ahead. Combination of supports holding and healthy market dynamics continues to validate our bullish outlook on global equities.

• Company previously written up by starfox02 has doubled in price since August 2022
• Author sees potential for stock price to double again and provides a refresher on investment thesis
• Company specializes in manufacturing reliable and high-quality fuses, connectors, and power components for industries; trading at a low earnings multiple with opportunities for growth and margin expansion

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.

• Palo Alto Networks, a cybersecurity company, has reported a strong fiscal third quarter 2024.
• The company continues to observe robust cyberattack activities, with an increasing focus on software supply chain and hardware vulnerabilities.
• Notably, the adoption and experimentation of artificial intelligence (AI) by their customers have introduced a new set of threats, leading to the development of security products designed specifically to secure AI usage.

• The entire saga here of Teijin Ltd (3401 JP)‘s disposal of its 55.1% stake in Infocom Corp (4348 JP) is being played out in the non-generally-public press. 
• There is reportedly a new piece of writing out late Thursday which suggests an approach.
• I wrote about the “meaning” of words in Infocom (4348 JP) – The Meaning of ‘Binding Bids’ and ‘¥250bn’ and now there is more nuance to parse.

• The first trial in December 2022 ordered Chey to pay 67.5 billion KRW; today’s ruling increased this to 1.38 trillion KRW plus 2 billion KRW, including splitting SK Inc. shares.
• The increased settlement and SK Inc. share split could spark a management rights battle, causing SK Inc.’s stock price to jump as investors and shareholders react.
• It may take a year for the final verdict, making a sustained stock price increase unlikely. Yet, differences between trial rulings could alter Chey’s SK Inc. stake, sustaining market interest.

• Shift Up (462870 KS) is Korea’s leading game development studio. It is seeking to raise up to US$320 million.
• We previously discussed the IPO in Shift Up IPO: The Investment Case. 
• We examine the syndicate’s valuation methodology. Our analysis suggests that Shift Up is attractively valued in the IPO price range. We would participate in the IPO.

• 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.

• 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

• 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.

• 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.

• BILL Holdings shares significantly underperformed in 2024 with shares down ~37% year-to-date versus a 12% gain on the Nasdaq Composite Index.  
• Shares saw sell-off post 3Q’FY24 earnings as results indicated a weak 4Q’FY24 guidance and customer churn while SMBs continue to be pressured by high inflation and interest rates.
• My bear case implies a $31 valuation (vs. prior $25 PT), based on ~2x FY25E EV/Revenue and bear case FY25E revenue of $1368M, representing ~40% downside vs. current levels.

• 214MW of new projects to more than double the existing 75MW in operation and further builds on Soluna’s impressive corporate turnaround.
• In the past year, Soluna has launched its flagship Project Dorothy with both hosting (1A) and propriety mining (1B), moved to more profitable hosting contracts at its 25MW Project Sophie, began diversifying revenue through AI hosting at Project Sophie, and launched a new AI cloud venture and the Helix AI datacenter design.
• In addition, the company has been adjusted EBITDA positive for the past two quarters, while the balance sheet has improved. 

• The TIP Taiwan Select High Dividend ETF (00919 TW) tracks the TIP Customized Taiwan Select High Dividend Index and has an AUM of TWD 209bn (US$6.5bn).
• There could be 14 changes for the ETF in June with an estimated one-way turnover of around 40% and a round-trip trade of around US$5bn.
• The potential adds have outperformed the potential deletes over the last couple of months and there could be more to go heading into announcement and implementation.

• 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.

• 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.

• Quantgroup Technology (1467534D CH) is looking to raise up to US$200m in its upcoming HK IPO. The deal will be run by CICC and CMB International.
• Quantgroup Technology is a digitalization solutions provider in China. Its digitalization solutions primarily include digitalized marketing, including precision marketing for financial institutions and local merchants, and goods transaction facilitation.
• The apps that Quantgroup operates can be largely categorized into two Quant-enabled proprietary apps, namely Yangxiaomie and Consumption Guide. 

• 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.

• Zeta Markets, a Solana-based decentralised exchange for on-chain perpetuals, has closed a US$5 million strategic funding round led by Electric Capital, with participation from DACM, Selini Capital, and Airtree Ventures.
• Prominent angel investors also joined, including Anatoly Yakovenko of Solana, Mert Mumtaz of Helius, Richard Wu of Tensor, Marius Ciubotariu of Kamino, Stepan Simkin of Squads, Alex Smirnov of Debridge, Genia Mikhalchenko of Pyth, Nom of Bonk, and JMR Luna of Wintermute.
• This deal brings Zeta Markets’s total funding raised to date to US$13.5 million.

• Waystar Holding, provider of mission-critical cloud software to healthcare organizations, set terms for an IPO and plans to raise ~$970M in the upcoming Nasdaq offering.
• The initial public offering is expected to be between $20.00 and $23.00. At the midpoint, Waystar Holding has a market value of ~$3.7B based on 173.4M fully diluted shares.
• In my insight, I discuss valuation framework for comparable company analysis and research multiples of M&A transactions, including Athenahealth, Cerner and Change Healthcare. 

• Nvidia reported earnings, and as expected, they beat earnings. Did you think that Jensen would fail us now?

• On a more serious note, the guide was a bit light regarding buy-side bogeys, but there is almost nothing to complain about this result.

• Below is the StreetAccount summary, and you can see it’s a clean beat by every metric.

• Asmedia Technology (5269 TT) is looking to raise up to US$335m in its global depository receipts (GDRs) offering.
• Overall, the deal would be a relatively small one for the stock to digest at just 5.6 days of its three month ADV.
• In this note, we run the deal through our ECM framework and comment on deal dynamics.

• 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.

• Shift Up (462870 KS) is Korea’s leading game development studio. It is seeking to raise up to US$320 million.    
• Shift Up now focuses only on game development and has a policy of publishing games in cooperation with global partners such as Tencent (700 HK) and Sony Corp (6758 JP). 
• The investment case rests on a stellar game development track record, several growth drivers, high profitability and cash generation.

• 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.

• The SE600 index is one of the most widely followed benchmark indices in Europe. This index is rebalanced on a quarterly basis.
• The base date for rankings for the June 2024 index rebal event is 31st May 2024. In this insight, we take a look at the latest list of potential ADDs/DELs.
• Currently, I see 7 ADDs and 7 DELs for the SE600 index. There are more names just outside the border requiring small price changes to get involved in index changes.

• 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.

• Shift Up (462870 KS) plans to raise up to US$320m in its South Korean IPO.
• Shift Up is a South Korean games developer, which as released three games so far for the global markets.
• We have looked at the company’s performance in our past notes. In this note, we talk about valuations.

Datatec reported FY24 revenue growth of 6%, with a strong performance from Westcon, a good performance in Logicalis International masked by a higher level of net revenue software sales and a mixed performance in Logicalis Latin America. Group gross profit grew 16% y-o-y and adjusted EBITDA grew 7%, resulting in a flat adjusted EBITDA margin of 3.5%. Underlying EPS of 20.2c more than tripled versus the prior year and good control of working capital resulted in year-end net debt of $123m. The company announced a dividend of ZAR1.3/US$0.07. Despite the difficult political and economic environment, management expects to see improved performances in each business in FY25 and continues to focus on unlocking shareholder value as part of its ongoing strategic review.

• A variety of articles of recent from private media sources have suggested that Teijin Ltd (3401 JP) has its 55% stake in Infocom Corp (4348 JP) up for auction. 
• According to earlier articles, binding Second Round bids were due last week. According to an article out late last week, binding bids have been made, with some “around ¥250bn.”
• What that means for price may depend on what the “around ¥250bn” means. A brief exploration below. 

• With the review period now complete, there could be 5 changes to the Yuanta/​P-Shares Taiwan Dividend Plus ETF in June.
• Price changes and changes to dividend estimates have led to names dropping off the list of potential adds and deletes over the last week.
• Constituent changes, capping and funding flows will lead to a one-way turnover of 12.7% and a one-way trade of US$1.17bn. There are 12 stocks with over 4x ADV to trade.

• Asia Vital Components (3017 TT) could replace Chang Hwa Commercial Bank (2801 TT) in the Yuanta/P-Shares Taiwan Top 50 ETF at the June rebalance.
• This ETF inclusion for Asia Vital Components (3017 TT) could come back-to-back with another index inclusion scheduled for the end of May.
• Shorts in Asia Vital Components (3017 TT) have been increasing recently while shorts in Chang Hwa Commercial Bank (2801 TT) are near their lows.

• 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

• 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.

• We compare Lalatech’s scale, P&L, Balance Sheet, and Cash Flow to peers
• On several measures, Lalatech is comparable to Full Truck Alliance, SF-Intra
• Small, unprofitable GOGOX not an appropriate comp for Lalatech, in our view

• 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.

• Shift Up (462870 KS) plans to raise up to US$320m in its upcoming South Korean IPO.
• Shift Up is a South Korean games developer, which as released three games so far for the global markets.
• In our previous note, we looked at the company’s past performance. In this note, we will undertake a peer comparison.