In today’s briefing:
- Tianqi Lithium: Upcoming Events & AH Premium
- XME, XLE Oversold Trade
- SCC : Meaningful QoQ Recovery Expected in 2Q22
- FTSE UK Quiddity Leaderboard Sep 2022 (2.0): Multiple Intra-Review Changes in the Next Two Weeks
Tianqi Lithium: Upcoming Events & AH Premium
- Tianqi Lithium (002466 CH) trades at an 84% premium to Tianqi Lithium (9696 HK) and the AH premium has been volatile since listing.
- Tianqi Lithium (002466 CH)‘s potential inclusion in the MSCI China and FTSE All-World Index could keep the AH premium at a higher level as compared to its peers.
- Tianqi Lithium (9696 HK)‘s inclusion to Southbound Stock Connect in August and potential inclusion to the MSCI and FTSE indices will help keep a lid on the AH premium.
XME, XLE Oversold Trade
- XME (metals/mining) and XLE are oversold rotation long plays for a rally off noteworthy support.
- SPX rally stall near 3,900 near term resistance (dip/rally) must be factored into commodity price action.
- USD is due for a marginal pullback that will provide fuel for oversold commodities. We like the AUD for a rally to 0.70.
SCC : Meaningful QoQ Recovery Expected in 2Q22
- We maintain our BUY call with a TP of Bt445 based on 13.7xPE’22E,which is close to its 10-years trailing mean. We recommend investors to accumulate in light of 4% yield
- Solid QoQ improvement expected in 2Q22 core profit We forecast 2Q22 core profit at Bt9.2bn,decline 46%YoY but edge-up 19%QoQ.The YoY erosion is due to weaker assumed gross margin of 16.2%
- We foresee chemical unit’s profit to fall 63%YoY but to march up 8%QoQ with wider spreads. In our view, the QoQ uptrend is underpin by solid PVC spread (+41%QoQ), despite
FTSE UK Quiddity Leaderboard Sep 2022 (2.0): Multiple Intra-Review Changes in the Next Two Weeks
- This insight is a follow-up to FTSE UK Quiddity Leaderboard Sep 2022: Sanne Group Deletion Seems Likely in 3Q 2022.
- GSK’s spin-off of Haleon (HLN LN) and the completion of Vivo Energy (VVO LN) and Ultra Electronics Holdings (ULE LN) Deals could cause intra-review changes in the next two weeks.
- There could be more in the subsequent weeks too. Below is a closer look at the timeline and the potential replacement names for these index events.
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