Daily Brief Energy/Materials: Ecopro Co Ltd, Merdeka Battery Materials, Rio Tinto Ltd, Mincor Resources NL, Constellium NV, Natural Gas, Vedanta Resources and more

• Based on closing price from 3 April, we forecast 5 adds and 4 deletes for the MSCI Korea Index at the May QCIR.
• Three of the adds are close to triggering the extreme price increase criteria – if triggered, index inclusion could be deferred to a subsequent index review.
• Retail investors have been buying three of the potential adds, while foreign investors have taken the lead on two. Foreign investors have been sellers on all the potential deletions.

• Merdeka Battery Materials (2012725D IJ)  is looking to raise around US$580m in its Indonesian IPO.
• It has the largest resource globally in terms of contained nickel at the Konawe Nickel Mine (the SCM Mine), according to Wood Mackenzie
• In this note, we undertake a quick peer comparison, talk about our earnings assumptions, and share our thoughts on valuation.

• Discounts to NAV of covered holdcos have shown mixed performance during March, with spreads widening until short after the UBS/CS deal, now tightening. 
• Discounts to NAV: C.F.Alba, 51.2%; GBL, 35.8%; Heineken Holding, 14.6%; Industrivärden C, 11.1%; Investor B, 9.7%; Porsche Automobile Holding, 49.6%. The spread of Rio Tinto DLC widened to 18.9%.
• Recommended trades: Heineken Holding, Investor AB (long Investor B/short main holdings) and Rio DLC.

• Last week, Mincor Resources NL (MCR AU) said BHP Group Ltd (BHP AU) would not agree to amend off-take agreement specifications, and therefore would no longer accept lower-quality ore.
• Mincor subsequently withdrew its earnings guidance, and Wyloo Metals shortly followed by declaring its A$1.40/share unconditional on-market Offer best and final.
• This morning (4 April), Mincor released its Target Statement, and recommends shareholders accept the Offer from Wyloo.

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
We view Constellium’s ESG as “Adequate”, in line with its Environmental and Social pillars, while the Governance pillar is “Strong”. Controversies are “Immaterial” and Disclosure is “Strong”.

• Oil businesses fear lower prices and a shortage of workers The quarterly Dallas FED Energy survey showed some pretty interesting results.
• First of all, business activity tanked and the uncertainty level of businesses rose.
• The survey also highlighted which price small and large drilling companies need in order to produce oil without a loss.

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.

• Central China Securities
• Vedanta Resources