In today’s briefing:
- Austal (ASB AU)’s Placement Puts The Skids On Near-Term M&A
- Japan Steel Works (5631) | Artillery Giant Reloads for Growth
- Asia Real Estate Tracker (11-Mar-2025): Singapore buying Sydney office for $70M.
- Goldlion Holdings (533 HK) Privatization – The Offer Price Is Acceptable
- IndusInd Bank: Derivative Discrepancy Surfaces, Raising Governance Concerns
- The Intel Drama Goes On. No Buyer It Seems, Who Would? More Wafers Made at TSMC for Longer.
- The Beat Ideas: Narayana Hrudayalaya Ltd (NHL) ~ Driving Growth from India to Cayman Islands
- PDYN: Palladyne AI Leading in AI Software for Drones and Smart Machines
- The Beat Ideas: Shilpa Medicare
- GiG Works (2375 JP): Q1 FY10/25 flash update
Austal (ASB AU)’s Placement Puts The Skids On Near-Term M&A
- Taking advantage of a doubling in its share price over the last year, Austal is tapping the market to fund the expansion of its US facilities to fulfil US Navy contracts.
- Austal is placing out 52.6mn new shares (non-underwritten) at A$3.80/share – ~A$200mn all-in – a 15.6% discount to last close, and effectively tapping out its annual placement capacity.
- Provided the placement is squared away, founder John Rothwell will unload $50mn of his own stock. As such, any M&A activity is now firmly on the backburner.
Japan Steel Works (5631) | Artillery Giant Reloads for Growth
- Defense Windfall: JSW dominates Japan’s artillery market, set to benefit as defense spending triples, driving a 232% surge in defense sales to 80 billion yen by 2028.
- Strategic Expansion: Exclusive forging capabilities secure JSW’s artillery monopoly, while investments in railguns and next-gen armoured vehicles fuel long-term growth.
- Energy Tailwinds: JSW’s nuclear and offshore wind expertise ensures stable revenue, with reactor restarts and turbine foundations boosting its power segment’s profitability.
Asia Real Estate Tracker (11-Mar-2025): Singapore buying Sydney office for $70M.
- Cambridge, a Singapore-based firm, purchases a Sydney office block for $70M from a former Tysan boss, expanding its real estate portfolio
- Hong Kong Land reports a significant increase in losses, totaling $1.4B, attributed to challenges within its Central Portfolio
- M&G Real Estate invests $62M in student housing in Melbourne, Australia, highlighting their focus on the Australian real estate market. Warburg Pincus forms a partnership with SK Group to develop Korean senior living facilities, tapping into the growing demand for elderly care in South Korea.
Goldlion Holdings (533 HK) Privatization – The Offer Price Is Acceptable
- In recent years, Goldlion is facing performance headwinds. Both revenue and net profit have shown a downward trend due to declining consumption, real estate crisis and unfavorable external factors.
- In short term, the weak consumer confidence and market momentum are unlikely to improve. Goldlion’s performance may gradually pick up in 2026 and 2027 but is still in downward trend.
- Considering the low trading liquidity, weak fundamentals, uncertainties on performance brought by Goldlion’s potential strategic transformation and the concerns on the outlook, we think the Cancellation Price is acceptable.
IndusInd Bank: Derivative Discrepancy Surfaces, Raising Governance Concerns
- IndusInd Bank recently disclosed a significant accounting discrepancy in its derivatives portfolio, estimated to impact its net worth by INR 1,580 crore (~2.35%).
- The issue pertains to internal trades executed over the past 7–8 years, now identified through a detailed internal review initiated following regulatory changes.
- This development, when viewed alongside the abrupt CFO exit, regulatory pushback on CEO tenure, and existing operational challenges, raises concerns around internal controls, risk governance, and management credibility.
The Intel Drama Goes On. No Buyer It Seems, Who Would? More Wafers Made at TSMC for Longer.
- Following Broadcom CEO saying “no” and TSMC investing another US$100bn in Arizona, speculations of an Intel takeover have subsided.
- On the increase, rumors of further Intel 18A delays and production push out. This means more outsourcing to TSMC for longer as mentioned by Intel’s IR last week.
- Now is not a good time to buy Semiconductor stocks, but AMD and TSMC will benefit.
The Beat Ideas: Narayana Hrudayalaya Ltd (NHL) ~ Driving Growth from India to Cayman Islands
- Narayana Hrudayalaya Ltd (NARH IN) is a prominent player in the Indian healthcare sector, distinguished by its commitment to providing affordable, high-quality medical services.
- The company established its first international hospital in the Cayman Islands in 2014, targeting patients from the Americas and Caribbean regions by offering competitively priced medical services
- Management has outlined a capex guidance of around INR 4,000 crores over the next 3 to 4 years, funded by healthy cash flows and stable operating margins.
PDYN: Palladyne AI Leading in AI Software for Drones and Smart Machines
- Palladyne AI sells real-time learning and reasoning AI software platforms for robots, drones, and smart industrial systems.
- The company engages in the design, development, and manufacturing of industrial robotic systems that augment human performance by combining human intelligence, instinct, and judgment with the strength, endurance, and precision of machines to enhance employee safety and productivity.
- Its mobile robotic systems include the Guardian S, Guardian GT, Guardian XO, and Guardian XT. Palladyne AI was founded in 2015 and is headquartered in Salt Lake City, Utah.
The Beat Ideas: Shilpa Medicare
- Shilpa Medicare (SLPA IN) will begin commercializing new molecules across segments, driving growth to new heights as older products are phased out, ensuring sustained progress and innovation in its business.
- In recent years, the company has experienced growth stagnation and declining profitability due to US FDA issues affecting both the company and its key client in the API segment.
- The company’s pipeline of new molecules offers significant growth potential, with a single successful molecule poised to elevate the company to unprecedented levels over the next five years.
GiG Works (2375 JP): Q1 FY10/25 flash update
- GiG Works reported a revenue of JPY5.9bn, an 8.6% YoY decline, with all profit categories turning to losses.
- The On-demand Economy business, accounting for 42% of Q1 revenue, saw a YoY decline in revenue and profit.
- The Sharing Economy business achieved YoY revenue and profit growth, with a 10.8% revenue increase to JPY1.2bn.
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