TMT/Internet

• Q423 revenues of $15.4 billion, +8.5% QoQ, +10% YoY and $300 million above the guided midpoint
• Q124 guided to $12.7 billion, -17.5% QoQ albeit still up 8% YoY.  
• Intel’s share priced fell 12% on the guide. CEO says this was an overreaction. 

• I tally 48 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
• Three new deals discussed this week on Smartkarma: All-scrip deals for Newmark Property REIT (NPR AU) and Eureka Group Holdings (EGH AU); and Payroll (4489 JP)‘s Tender Offer.
• Key updates took place on: Orecorp Ltd (ORR AU), Weiqiao Textile Co (2698 HK), Mandala Multifinance (MFIN IJ), Shinko Electric Industries (6967 JP) & JSR Corp (4185 JP).

• The review period for the NIFTY family of indices, Nikkei 225, STAR50, the KRX New Deal Index and a global index ends on 31 January.
• The January rebalance of the IDX30 and LQ45 indices will be implemented at the close of trading on 31 January.
• There have been huge inflows into the CSI 300 Index ETFs for another week. This will increase the impact on the index changes at the next rebalance.

• This is our first report on Yelp Inc.
• The management addressed strong performance across several key metrics.
• They reported an impressive 10th consecutive quarter of double-digit revenue growth, achieving a record net revenue of $345 million which signifies a 12% YoY increase.

• This is our first report on PowerSchool Group Inc., an education technology company.
• The company recorded promising results in its Third Quarter 2023 Earnings.
• We have added reasonable forecasts of the annualized income statement and cash flows and carried out a DCF valuation of the company using its Weighted Average Cost of Capital (WACC) to determine a forecasted share price.

• This is our first report on Axcelis Technologies.
• As the power market continues to strengthen, Axcelis is guiding for Q4 2023 revenue with a gross margin of approximately 45% and an EPS of around 00.
• In this report, we have carried out a fundamental analysis of the historical financial statements of the company.

• This is our first report on Axcelis Technologies.
• As the power market continues to strengthen, Axcelis is guiding for Q4 2023 revenue with a gross margin of approximately 45% and an EPS of around 00.
• In this report, we have carried out a fundamental analysis of the historical financial statements of the company.

• This is our first report electronic manufacturing services provider, Plexus Corporation.
• The company’s Q4 2023 earnings, a significant takeaway includes the company’s impressive performance throughout the fiscal year.
• Plexus’ VP of Communications and Investor Relations, Shawn Harrison, emphasized the company’s focus on operational and customer service excellence, which ultimately led to strong financial results.

• Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
• On the IPO front, we continued our coverage of Amer Sports (AS US) and Thai Credit Bank, along with Guming Holdings and FirstCry. 
• Japan continued to be the driver for placements with Renesas Electronics (6723 JP)‘s large selldown.

• This is our first report on UScellular, a leading regional wireless network operator in the US.
• The company has been focusing on improving its fiscal outcomes while concurrently innovating in its network capabilities and service offerings.
• We have added reasonable forecasts of the annualized income statement and cash flows and carried out a DCF valuation of the company using its Weighted Average Cost of Capital (WACC) to determine a forecasted share price.

• China announced game approval for the Jan batch. The number of games approved has increased compared to recent months.
• The pace of China game approval appears to be accelerating, to the same level as pre-tightening.
• Tencent gets one game approved but we don’t see that the acceleration of game approval benefits big names proportionally.

• Bloomberg reports that Glass Lewis has recommended Hollysys Automation Technologies (HOLI US) shareholders vote against Ascendent Capital’s US$26.50 offer on 8 February.
• Glass Lewis notes that Hollysys could fetch “potentially materially greater value” from other bidders. Glass Lewis seems to ignore that Dazheng failed to demonstrate that it could complete its offer.
• Despite Glass Lewis’s recommendation, the vote will likely get up. At the last close, the gross/annualised spread for an end-March close is 4.5%/28.0%.

• What production fabs and capacity? Intel’s Arizona 10nm Fab 12, 22, 32, which are mostly depreciated. Intel will provide nearly 30k/m 12″ capacity for UMC at the first stage.
• Who’s 12nm node and design rule? UMC’s tsmc-like 12nm design rule for customers to produce WiFi 7, TV controller, and other products.
• Other discussions include: “Who will operate the fabs?”, “How to share sales/profits?”, “Mass production time?”, “Why benefits to Intel?”, “Why benefits to UMC?”, “Will TSMC get hurt?”

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
• SK Hynix

Key points (machine generated)

• Expanding into emerging markets like mobile gaming presents potential for growth.
• The founder’s strong understanding of the industry and long-term approach align with the company’s growth potential.
• Untapped value in the game pipeline and potential expansion into mobile gaming could drive further growth for tinyBuild.

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 November saw the clean-up trade of INCJ getting out of Renesas Electronics (6723 JP). That was 180+mm shares, well over-subscribed.  
• Today we have news Hitachi and NEC are getting out of their stakes. That’s 123mm shares in an Accelerated Block Offering of about US$2bn. I expect it will go well.
• Recent gains in semiconductor stocks globally make this larger discount attractive. I expect a little heaviness but not much. There are index repercussions for international indices.

• Hitachi Ltd (6501 JP) and NEC Corp (6701 JP) are looking to sell their entire stake in Renesas Electronics (6723 JP) in a deal that will raise around US$2.2bn.
• Renesas Electronics (6723 JP) dropped a bit in November following INCJ’s stake sale but momentum has picked up again as the stock reaches for new highs.
• The float increase in global indices will coincide with the offering. There will be BIG buying by TSE Tokyo Price Index TOPIX (TPX INDEX) trackers in October.

• Hitachi Ltd (6501 JP) and NEC Corp (6701 JP) aim to raise around US$2.1bn via a sell-down of  their stake in Renesas Electronics (6723 JP). 
• The stock has seen a number of deals over the past few years with the most recent one being a cleanup in Nov 2023, which did well.
• In this note, we will talk about the placement and run the deal through our ECM framework.

• Investor confidence toward the Chinese tech sector remains fragile after the government crackdown, and Alibaba Group was particularly hard hit due to Jack Ma’s previous conflicts with Chinese regulators.
• Growth of its main eCommerce business is in question given the softening Chinese economy and intense competitions. Additionally, the growth of its cloud computing unit is also slowing down. 
• China’s stock market stabilization fund is not likely to benefit Alibaba directly as it will be used to buy onshore stocks only. 

• Blended ASP of decline of 1% q/q in the past two quarters in 2H23, better than 3-10% q/q decline during 3Q22-2Q23, resulting in Tesla’s blended ASP decline to decelerate.
• Due to Tesla’s cost cutting efforts with nice inventory control, we calculates profits/EV rebounded nicely by 21% q/q to US$3,490 per EV in 4Q23, much nicer than no profits.
• Good improvement on its FSD Beta version 12.1.2 lately might become a pure profits/EV boost by incremental subscription of US$10,000-15,000 per EV or monthly fee by existing Tesla owners.

• ASML reported Q423 revenues of €7.2 billion, up 7.5% QoQ and ~€100 million above the guided midpoint for the quarter.
• ASML guided Q124 at €5.25 billion, down a very significant 27% sequentially. Also reiterated their previous forecast for 2024 revenues to be remain flat with 2023
• ASML shares surged >8% in overnight trading. What’s going on here?

• SK Hynix results surpised consensus with a swing to positive operating profit; The company expects industry demand growth to exceed supply growth by a wide margin in 2024E.
• Management suggests optimism not just for 2024E, but also for 2025E. 2025E is when a much larger positive demand impact from AI is expected as AI products will expand substantially.
• SK Hynix comments regarding AI phones imply that consumers will most likely need to upgrade their phones, including iPhones, to take full advantage of AI capabilities

• Huawei Technologies Co. Ltd. on Thursday launched the latest version of its own operating system — HarmonyOS NEXT, which will no longer support Android apps and can only accommodate apps specifically developed for it.
• The Chinese telecom equipment giant said the Beta version for developers will be released in the second quarter, and the general version for consumers in the fourth quarter.
• Insiders from Huawei expect the new Mate smartphones to be released in the second half with the HarmonyOS NEXT installed.

• This is our first report on MicroStrategy, a company at the forefront of enterprise analytics software.
• In the third quarter of 2023, the company revealed notable developments in both its primary software ventures and its strategic Bitcoin investments.
• The overall revenue for this period reached $129.5 million, marking a 3% year-over year increase, with a significant 16% rise in software license revenues, totaling $45 million.

• The current market outlook is expected to improve, although the demand is still down in 1Q24F.
• The 2Q24F revenue could potentially increase by a high single digits QoQ at least.
• The demand is expected to grow by around 10% YoY in 2024F. This indicates a rebound, although not a strong one.

• Payroll (4489 JP) today announced that it would go private in a deal led by US PE Firm TA Associates (Japan office led by a former Carlyle person it appears).
• Payroll IPOed in June 2021 at ¥1,380. Then it fell. Now this takeout is at ¥1,380/share. Not a great look but not egregiously unfair by the looks of it. 
• This deal is going to get done easily as agreed participants and probable-friendlies get them past the minimum without retail or foreign holders participating.

• Payroll (4489 JP) has recommended TA Associates’ sponsored MBO tender offer of JPY1,380 per share, a 42.4% premium to the undisturbed (23 January). 
• The transaction is a two-step acquisition through a cash tender offer and subsequent squeeze-out. The lower limit of the tender offer is set at a 61.28% ownership ratio. 
• Based on the irrevocables, the minimum acceptance condition requires a 30.5% minority acceptance rate, which is achievable as the offer is marginally short of the all-time high. 

• Nearly halfway through the review period, we forecast 7 changes for the ChiNext Index (SZ399006 INDEX EQUITY) and 5 changes for the ChiNext 50 Index in June.
• Some of the potential changes will also have passive flows from the CSI 500 Index trackers at the same time as the ChiNext Index rebalance.
• The potential inclusions and deletions have slipped over the last couple of months along with the ChiNext Index, but the potential inclusions have outperformed as the deletions have dropped more.

• I confirmed that Posco DX will be incorporated into the KOSPI 200 IT Sector Index. The implementation date for this is also scheduled for March 15th.
• The direct flow size from the KOSPI 200 IT into Posco DX is approximately 0.3x ADTV, implying a noteworthy price impact on March 14th, concentrated from 2:00 PM to close. 
• When designing Posco DX’s March 14 KOSPI 200 inclusion flow setup, we must also proactively design strategies to capture flows from the KOSPI 200 IT within a narrow time window.

• The ASE Technology Holding (3711 TT) 1Q24F outlook may be dim due to normal seasonality, resulting in a decline of mid-to-high single digits in revenue.
• Mediatek Inc (2454 TT) and NVIDIA Corp (NVDA US) are expected to experience a strong rebound.
• The 2024F outlook for ASEH indicates a low double-digit YoY growth.  

• US-Led tech chain may push for AI phone features, which itself is a great strategy to pull the tech industry out of doldrums. It will pressure Huawei, in our opinion;
• We believe there are other stories unfolding in the AI era, including availability of AI killer apps, the rivalry between super apps and OS vendors, and the growing China/Ex-China chasm.
• Our Top Pick is Tencent and Kuaishou. We maintain Xiaomi at SELL.

• Taiwan Tech Plays Have Soared Since TSMC’s Strong Outlook, and SK Hynix Reported a Return to Op Profit
• Memory Monitor: Microsoft Copilot Will Supercharge Demand for DRAM; SK Hynix, Nanya Tech, Micron
• Key Upcoming Events — Intel, Microsoft, Mediatek, UMC Results Ahead

• We are initiating coverage of SurgePays (SURG), a forward- looking financial technology and telecommunications firm dedicated to serving the underbanked.
• Its wireless subsidiaries provide mobile broadband, voice, and SMS services to subsidized and direct retail prepaid customers primarily through the US Federal Affordable Connectivity Program (ACP).
• SURG has built a profitable business in the ACP segment of the wireless market.

• Shinko Electric Industries (6967 JP)‘s pre-conditional tender offer from the JIC alliance is JPY5,920 per share. Since the deal announcement, the gross spread has averaged 8.3%.
• The wide gross spread reflects the risk in satisfying the pre-conditions related to country approvals, particularly China and shareholder approval, due to Ibiden Co Ltd (4062 JP)’s re-rating.
• Ibiden’s re-rating is not necessarily an issue. JIC’s confidence in securing SAMR approval for the JSR Corp (4185 JP) transaction by March is a positive for Shinko’s SAMR approval. 

• KRX has announced that Posco DX (022100 KS) will replace Shinsegae International Co (031430 KS) in the Korea Stock Exchange KOSPI 200 (KOSPI2 INDEX) at the close on 14 March.
• Passive trackers will need to buy 0.5 days of ADV in Posco DX (022100 KS) while selling in Shinsegae International (031430 KS) is larger at over 7 days of ADV.
• L&F (066970 KS) lists on the KOSPI market on 29 January; there is a possibility that the stock is also added to the index in March as a Fast Entry.

• We have been covering Zee Entertainment Enterprises (Z IN) during the entire merger saga and had already highlighted several financial and governance issues with the entire group.
• The $10 bn merger deal with Sony has now been terminated but it is not a surprise to us, considering the events that were unraveled in the last two years.
• But where does ZEEL go from here is a question that lacks some clarity. There are uncertainties looming around and ZEEL can face further brunt. 

• The SPX, Nasdaq 100, and DJI breaking out to new all-time highs following 3-week consolidations. Russell 2000 (IWM), S&P 400 (IJH), Vanguard ExtendedMarket (VXF), countless other Sectors/industries breaking out also.
• This is classic bull market behavior. Considering market dynamics remain healthy, this is all evidence that supports our ongoing bullish outlook.
• Software, Data Storage buys: NTAP, NTNX, DBX, VRNS, and CVLT. Investment Banking & Brokerage, Mid-Cap buys: JEF, SF, EVR, MC, and LAZ

• This is our first report on SaaS player, nCino Inc.
• The company’s third quarter fiscal 2024 performance presented both opportunities and challenges in the midst of a complex economic environment.
• The company announced a significant product win in relation to a consumer lending deal with an enterprise bank in the United States of over $200 billion.

• We expect Kuaishou to report C4Q23 revenue, IFRS op. profit and IFRS net income in-line, 34% and 29% vs. consensus, thanks to margin improvements;
• Playlet continued to generate significant organic traffic, leading to decreasing sales marketing cost and growth in advertising inventories. We further expect AI to drive playlet market expansions;
• E-Commerce GMV growth was robust. Kuaishou will likely increase take rate in the future. We maintain BUY and raise TP to HK$79, implying an 17x PE.

• This is our first report on Marathon Digital Holdings, a renowned cryptocurrency technology company.
• Improved operational efficiency also resulted in a lower cost per bitcoin mined and a drop in all-in cost per coin.
• In this report, we have carried out a fundamental analysis of the historical financial statements of the company.

• This is our first report on fabless semiconductors player, Silicon Labs.
• The third quarter of 2023 has been a difficult period for Silicon Labs amidst a backdrop of weak demand and heightened inventory levels.
• In this report, we have carried out a fundamental analysis of the historical financial statements of the company.

• This is our first report on critical technical equipment, components, software, and services provider, Vontier Corporation.
• The company, in its latest earnings, exhibited noteworthy progress in its strategies and performance for the third quarter.
• The top-line performance recorded for the quarter outperformed expectations with baseline core revenue growth of 10%, reflecting gains from the company’s connected mobility strategy.

• This is our first report on analog and mixed-signal integrated circuits manufacturer, Power Integrations.
• The company’ Q3 2021 Financial Results depict a mixed picture with modest sequential growth but a contraction in sales year-over-year.
• For Q4, Power Integrations expects a sequential decrease to $90 million at the midpoint of the range, largely reflecting broad-based weakness echoed by industry peers amid challenging macroeconomic conditions.

• L&F Co Ltd (066970 KS) will move from the KOSDAQ Market to the KOSPI Market on 29 January. That means KOSDAQ 150 Index deletion at the close on 26 January.
• As the highest ranked non-constituent from the Information Technology sector at the December rebalance, Seronics Co Ltd (042600 KS) will be added to the index.
• Short interest on L&F Co (066970 KS) is 1.8m shares (KRW 364bn; 4.98% of shares outstanding; 7.24% of float; 2.4x ADV). There could be recalls from passives and forced covering.

• With three-quarters of the review period nearly complete, we forecast 50 changes (the maximum permitted) for the CSI 500 Index at the close on 14 June.
• There is a big sector skew in the potential changes. We estimate a one-way turnover of 9.1% at the June rebalance resulting in a one-way trade of CNY 5.34bn.
• The potential adds and deletes and the CSI 500 Index have performed in line since August and the current setup appears attractive.

• In this insight, we take a look at the potential index changes for ASX 300, 200, 100, 50, and 20 in the run-up to the March 2024 index review.
• The conclusion of the Costa Group Holdings (CGC AU) M&A deal could trigger an index change in February 2024.
• Separately, there could be a “surprise” index change in March 2024 caused by a long-term trading suspension. 

• Travelsky Technology Ltd H (696 HK) has been the predictable play for a rebound in domestic tourism in China.
• 1H23 result did not show anything that should alert investors to the changes in business practices.
• The recent profit warning disclosure has alerted investors that there is something else beyond the usual.

• The China equity markets have continued to slide and the lower market caps and free float market caps will see a lot of stocks deleted from passive portfolios in February.
• We currently estimate selling of around US$1.66bn across 74 stocks listed on the mainland, in HK and the U.S., and that number could increase as markets continue to underperform.
• The potential deletes have dropped a lot over the last 4 months and there has been a marked underperformance versus the headline indices over the last month.

Key points (machine generated)

• CPI Card Group’s debt-to-equity ratio is around 4.5x, higher than ideal but manageable with their cash flow generation.
• The smallcap downturn has affected the stock negatively, but the current valuation of CPI Card Group is deemed attractive, with a 20% free cash flow yield and 4.6x EV/EBITDA.
• With strong cash flow, reasonable debt management, and potential share buybacks, it is expected that the stock will increase in value when market sentiment improves.

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.

• Kinatico Ltd (ASX:KYP) is a ‘Know Your People’ regtech company providing workforce compliance monitoring and management technology and services.
• KYP has reported a 6% year-on-year increase in Q2 FY24 revenue to $7.1m, and a 145% year-on-year increase in SaaS revenue to $2.4m.
• SaaS revenue accounted for 33% of total revenue for the quarter, compared to 14% in Q2 FY23. 

• EB is leveraging its balance sheet to solidify the top position as an event marketplace. 
• The pricing plan at EB is not much different than its peers and we view it as more of EB catching up to the rest of the other event sites.
• The pricing model should become a source of revenue and adjusted EBITDA growth. EB’s competitors have different pricing plans that can make it costly for event creators

• This is our first report on intuitive human interface solutions provider, Synaptics Incorporated.
• In its First Quarter 2024 Financial Results , the management addressed the current standing of the company and projected future expectations.
• Despite the challenging market conditions, Synaptics remains optimistic about its business and expects to see improvements in 2024.

• The JIC Deal for Shinko Electric Industries (6967 JP) started trading wide when announced five weeks ago. It is still at 9% for perhaps 9 months.
• There is FUD. There are Flows. Just like JSR (4185). Some of that FUD can be explained by “gap risk” on deal break…. or can it? We look at risks.
• 5 weeks ago, there was more positioning risk than fundamental risk. But now main comp Ibiden has outperformed Shinko by 17%. Gap risk is fundamentally lower now. Bump risk exists.

• KRX notified local brokerages last week about allowing market orders for single stock futures (SSF) from April. Currently, 192 SSFs are listed.
• Anticipating short-term effects, heightened frequency and impact of erroneous orders may cause spot market confusion. KRX plans real-time bid disclosure for SSFs to prevent price distortions.
• Nonetheless, we will likely observe SSF price volatility surges. Real-time bid exposure could exacerbate volatility due to premature information revelation. Preemptive position setups considering these factors are advised.

• MSFT’s new AI features for Windows will need computers with at least 16GB of DRAM to run effectively. MSFT is asking manufacturers for this as a minimum for AI models.
• MSFT announced Copilot Pro for individuals and small businesses last week. The desire to use generative AI and the minimum required DRAM will drive accelerated PC upgrades.
• We note relative strength in 16GB DRAM prices; In Memory space, we continue to see relative value in SK Hynix, however, Nanya has the opportunity to Outperform in Taiwan.

• This is our first report on cyber exposure solutions provider, Tenable Networks.
• The company’ Q3 2023 earnings highlighted steady financial performance, strong contributions from its platform products like Tenable One, and overall business growth, particularly in the public sector.
• In this report, we have carried out a fundamental analysis of the historical financial statements of the company.

• This is our first report on sensor technology player, Allegro MicroSystems.
• Sales in these strategic growth areas made up 56% of total sales, indicating a successful strategy execution focused on these specific sectors.
• The company’s automotive revenues grew 31% year-over-year, with the electrification of vehicles and Advanced Driver Assistance Systems adoption being the main growth drivers.

• On January 18, 2024, Cambium preannounced that 4Q23 revenue would likely come in at $40 million, below its guidance of $45.0-50.0 million provided on November 2, 2023.
• This is the third revenue miss in a row.
• Cambium stated that the revenue miss was driven by $11 million in distributor incentives in 4Q23.

• This is our first report on mobile voice and data communications services provider, Iridium Communications.
• The company’s Q3 2023 Earnings demonstrated both the company’s resilient growth and emerging challenges in an increasingly competitive environment.
• In this report, we have carried out a fundamental analysis of the historical financial statements of the company.

• This is our first report on IT services company, Kyndryl.
• This increase has been attributed to successful execution of its operations, demonstrating their ability to drive substantial profit growth in the company.
• In this report, we have carried out a fundamental analysis of the historical financial statements of the company.

• This is our first report on hybrid cloud analytics software provider, Teradata Corporation.
• The company’s 2023 Q3 earnings were recently reported and the leading cloud analytics and data platform company had delivered another strong quarter and remained confident it would achieve its 2023 forecast.
• In this report, we have carried out a fundamental analysis of the historical financial statements of the company.

• This is our first report on Varonis Systems, a company specializing in data security and analytics.
• The company is navigating a pivotal shift in its business model, transitioning from traditional software offerings to a Software as a Service (SaaS) model.
• In this report, we have carried out a fundamental analysis of the historical financial statements of the company.

• Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
• On the IPO front, we continued our coverage of Amer Sports (AS US) and looked at Mixue Group Hong Kong filings.
• Placements continued to trickle in throught the week, across the region, apart from Hong Kong.

• This is our first report on Workiva Inc., a leading provider of solutions for enterprise productivity.
• Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology.
• In this report, we have carried out a fundamental analysis of the historical financial statements of the company.

• This is our first report on customer engagement platform operator, Braze Inc.
• The company’s Q3 2024 earnings highlighted consistent YoY growth, despite a challenging macroeconomic environment, with its operating efficiency throughout the business.
• Non-GAAP gross margin improved by 170 basis points YoY, and non-GAAP operating margin exceeded last year’s third quarter by 1,100 basis points.

• Q423 revenues of $19.62 billion, at the high end of guidance, up 13.8% QoQ and down 1.5% YoY. Net profit margin of 38.2% results in net income of ~$7.5 billion.
• FY23 revenues of $69.3 billion, down 8.7% YoY, only the second such down year since 2005
• Bullish FY24 forecast for >20% YoY growth sends share price soaring in overnight trading. 

• WT Microelectronics (3036 TT) is looking to raise US$256m from selling half of its stake in Asmedia Technology (5269 TT).
• The deal wouldn’t be a very large one to process at just 3.4 days of ASMedia’s ADV.
• Although, the selldown doesn’t appear to be particularly well flagged. The remaining WT Microelectronics’ stake will also create an overhang on ASMedia’s share price as well.

• TSMC: Stock Prices Soared After Reporting Earnings, But ADR Rose Higher… Now +12.4% Premium, Shortable Level
• ASE: ADR Spread Has Rebounded Substantially, Now +8.6%. Not Yet at Short Levels.
• ChipMOS: ADR Spread Drops to -2.2%, Good Level to Go Long.

• Travelsky Technology Ltd H (696 HK) (TravelSky) issued its 2023 operating statistics and a profit warning that is far below market expectations, the share price has plunged by 36% 
• Our analysis suggests that staff cost, commission, and systems costs have soared. This will be contained when traffic accelerates and absorbs these fixed cost items 
• Our target price of HKD9.92 (+21% UPSIDE) is based on 2024 PE 14.8x (1SD below mean). Keep an eye, worthwhile trade, due for a bounce    

Key points (machine generated)

• IndiaMart is India’s largest online B2B marketplace with a market cap of $2 billion.
• The company has a 60% market share of B2B e-commerce in India, indicating a large potential for growth.
• IndiaMart benefits from a negative working capital business model, upfront supplier subscription payments, and a net cash balance sheet. It also has the option to invest in new business lines to expand its monetization opportunities. Despite limited advertising spend, the platform attracts over 1 billion in traffic.

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.

• We see global equities (MSCI ACWI) going through a pause/pullback amid short-term breakouts in the U.S. dollar (DXY) and global sovereign 10-year yields.
• A rising DXY and climbing yields is a near-term headwind, and we could continue to see more choppy price action in the weeks ahead.
• With that said, as long as the DXY remains below $106, the 10-year Treasury yield remains below 4.35%, and ACWI-US is above $98, we would view pullbacks as buying opportunities.

• SoftBank group’s headline NAV discount is over 50%, factoring in the T-Mobile shares windfall at December-end
• SoftBank Corp is looking to IPO digital payments company PayPay, which should also be a positive driver for SoftBank Group shares going forward, but only a marginal one
• Arm shares have been defying gravity, but we see downside risk going forward, as well as questions over SVF1 and SVF2 private company valuations; and the threat of JPY appreciation

• TSMC expects 2024 semi sector in recovery with 20-25% y/y growth itself, driven by AI customers. By controlling capex, more rooms to raise dividends but no growth for equipment vendors.
• Faster ramp on N3, likely N3E, N3P than competitor’s. TSMC expects 3nm from 6% of sales in 3Q23, 12.7% in 4Q23 to 15% in 2024, 3x y/y increase in 2024.
• TSMC reports a nearly 30% q/q drop on IOT and consumer IC demand and sees weakness on 12″ mature technology despite better demand 8″ specialty technology.

• TSMC reported 4Q23 results at the upper end of its guidance. More importantly, the company guided for low/mid 20% 2024E sales growth and reiterated an expected 15-20% multi-year CAGR.
• The company provided optimistic guidance for the overall semiconductor industry, forecasting 10% growth in 2024E. TSMC expects to grow much faster than the industry, however.
• TSMC is one of our Structural Longs; our NT$760 target implies 29% upside. The latest results make TSMC’s Buy case even more clear, in our view.

• The SE600 index is one of the most widely followed benchmark indices in Europe. This index is rebalanced on a quarterly basis.
• In this insight, we take a look at the potential index changes that could take place between now and the end of the March 2024 index rebal event.
• Based on the latest available data, I expect there to be up to seven index changes in the first quarter of 2024.

• Novatek Microelectronics Corp (3034 TT) had reserved Apple (AAPL US) iPhone 16 Display Driver IC (DDIC) for future shipment since 3Q24F when qualification past.
• Novatek’s outlook is increasing to about 1~5% in 1Q24F, remarked a higher quarter demand than 4Q23.
• It could be a low season in 2Q24F because the rush order shown up around Chinese New Year.  

• Huawei Technologies Co. Ltd. is facing trouble in meeting delivery commitments for the first electric vehicle (EV) it has co-developed with auto partner Chery Automobile Co. Ltd., a possible sign of supply chain challenges for the model.
• Some people who placed orders for the Luxeed S7, which is the first electric sedan marketed under Huawei’s Smart Selection business model, recently complained online that they could not receive their cars within the promised timeframe.
• In an effort to mollify the customers, Luxeed announced Monday on social media that it will provide people who placed orders for the Luxeed S7 between Nov. 28 and Jan. 15 with varying cash compensation capped at 10,000 yuan ($1,403), based on their wait time.

• The revenue/ GM/ OPM/ EPS is USD$19.62bn/ 53%/ 41.6%/ NT$9.21 in 4Q23. The revenue/ GMO/ OPM is US$18-18.8bn/ 52-54%/ 40-42% in 1Q24F guidance.
• TSMC’s sales for 2024F are expected to grow in the low to mid-twenties YoY.
• 2024F is expected to be a relatively healthy year for the high-performance computing (HPC) and artificial intelligence (AI) sectors, with robust demand.

• Shift Inc (3697 JP) reported 1QFY08/2024 results last week. Revenue and OP increased 29.5% and 0.4% YoY to ¥25.1bn and ¥1.8bn respectively.
• Both revenue and OP were below consensus estimates which triggered a more than 25% drop in Shift’s share price over the last 5 days.
• We think the weaknesses in the company’s 1Q earnings were temporary and we expect the company’s earnings to show recovery going forward

• This is our first report on MACOM, a renowned semiconductors manufacturer in the U.S.
• The management of the company is focused on the firm’s performance over the fourth quarter and the full fiscal year of 2023, as well as on prospects for the first fiscal quarter of 2024.
• MACOM reported $150.4 million in revenue for the fourth quarter, with an adjusted EPS of $0.56 per diluted share along with $648 million in revenue and an adjusted EPS of $2.70 for the full fiscal 2023.

• This is our first report on Monday.com, a well-known team management platform for organizations and businesses.
• In the third-quarter fiscal year 2023 earnings, Monday.com reported robust growth, considerable margin improvement, and substantial cash generation.
• The company shares that they achieved a record non GAAP operating margin of 13% and free cash flow margin of 34%.

• The United Microelectronics Corp (2303 TT)’s updated revenue outlook for 1Q24F suggests that it could be relatively flat QoQ..
• UMC’s Asian clients, particularly Mediatek Inc (2454 TT) and Novatek Microelectronics Corp (3034 TT), are experiencing increased demand in 1Q24F.
• On the other hand, European and American clients are more bearish in 1Q24F and have not shown signs of improvement yet.