Daily Brief Energy/Materials: Gem Co Ltd A, Grupa Lotos SA, Scotts Miracle-Gro Co Cl A, Honghua Group and more

• Gem Co Ltd A (002340 CH) is looking to raise around US$245m in its Swiss GDR listing.
• Proceeds will be used mainly for overseas expansion, such as the development of the Indonesian Nickel Resource Base and development of its production base and recycling center in Europe.
• In terms of discount, relative to the most recent two deals, Keda Industrial and Ningbo Shanshan, GEM’s GDRs are offered at a more enticing 11.7-14.2% discount to its A-shares,

• Shareholders of Polish refiner PKN Orlen approved the proposed takeover of smaller rival Grupa Lotos, bringing Poland closer to creating a national champion better able to compete against global players.
• This takeover has been planned for a long time and could not proceed until the EU gave the green light with a long list of remedies.
• Gross spread (as of 22 July) is 5.63%. Shares of Lotos will cease trading next week. Long 1 LTS PW/short 1.075 PKN PW.

• The following names are “on the workbench”, ie., names we are working on that look interesting from the short side. They are discussed, with charts, in the PDF attached below.
• We like to be as transparent as possible in our short idea generation process.  
• Today, we are flagging: Scotts Miracle-Gro, Corsair Gaming, CF Indus, Gap Inc, Hub Group.

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.

• Honghua Group
• Tata Steel Thailand