Daily Brief Equity Bottom-Up: TSMC:  Caution as GEM Funds Switch to Underweight and more

• Average EM fund weights and active fund ownership hits record highs in TSMC
• However, investor caution is starting to surface, with 13.4% of funds shifting to underweight  in the last six months, driving the net underweight to a 15-year low of -1.21%.
• Net outflows of $3 billion over the past six months, led by Invesco, JP Morgan, and MFS, and with four times more sellers than buyers.

• Deepak Fertilisers & Petro (DFPC IN) commissioned 500KT of ammonia plant that will remove their dependence on import of critical raw material.
• DFPCL’s TAN capacity stands at 629 KTPA, with plans to increase it to 1,000 KTPA by FY26 through a new facility in Gopalpur, Odisha.
• Deepak Fertilisers & Petro (DFPC IN) is about to complete its restructuring by creating a separate subsidiary for mining chemicals, which in future they may plan to list separately. 

• Mitchell discusses the success and potential of Crocs, noting its growth and potential for continued success
• Andrew asks if Crocs is a fad or a sustainable business, with Mitchell emphasizing the brand’s importance and continued innovation
• Mitchell highlights Crocs’ success during the pandemic and discusses potential growth strategies for the future, including the importance of jibbets.

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• Enfusion reported its second quarter 2024 earnings with results aligning closely with the company’s prior guidance and consistent performance expectations in the medium term.
• The company posted $49.5 million in revenue, marking a 16% year-over-year growth.
• The adjusted EBITDA came in at $10.1 million, translating to a 20.5% margin.

• Lenovo commits $1B to AI advancements, strengthens F1 collaboration, showcasing innovation in technology sector.
• Garmin experiences growth in SEA sales for smart wearables, indicating a maturing market and strong consumer demand.
• Taiwan’s Transcom gains from global surge in military spending, develops world’s first open-source 6G core network, while Stellantis partners Maserati with China’s Chery amidst struggles in German automotive industry.

• Green Cross (006280 KS) has gained access to 80% of privately insured members in the U.S. for blood product Alyglo, which has been included in formularies of three major insurers.
• Green Cross targets to generate $50M revenue from Alyglo this year. The target seems to be conservative. The company further aims to sustain annual growth of 50%+, which is achievable.
• The company reported sequential improvement in 2Q24, with 17% QoQ revenue growth and significant improvement in gross margin. Revenue growth of 7–8% is expected during 2024–2026.

Boku reported 24% y-o-y revenue growth in H124, with both digital wallet/account-to-account (A2A) payments and direct carrier billing (DCB) payments growing at double-digit rates. Adjusted EBITDA grew 18% y-o-y with a margin of 30.1%. With ambitions to become the best localised payment partner for global commerce, Boku continues to invest in enhancing its product portfolio and strengthening its compliance and treasury functions. A pipeline of new digital wallet/A2A launches for major merchants and seasonal factors support continued strong growth in H224 and 2025. With FY24 outlook maintained, our revenue and adjusted EBITDA forecasts are unchanged.

• Taiwan Veldona human study to start in Sjogren’s.
• Ainos will initiate a Veldona clinical study in Taiwan for primary Sjogren’s syndrome in December 2024.
• This follows the announcement of an oral warts in HIV+ clinical study planned for November 2024. 

• We are reiterating our Buy rating, $29 price target and projections after reviewing Guess?
• stores in London.
• As we near the peak Fall season, Guess?

International Public Partnerships’ (INPP’s) portfolio continues to deliver consistent and predictable returns for investors, while providing environmental and social benefits for the individuals and communities that are served by its assets. INPP shares offer an attractive yield and the DPS is now in its 17th successive year of growth, with visibility for at least another 20 years. Continuing efforts to narrow the discount to NAV have gained traction, with both realisations and the share repurchase programme stepped up. However, discounts are sector-wide and a greater appreciation of the quality of INPP’s cash flows, a decline in interest rates and the prospects for accretive reinvestment may prove more potent factors in a re-rating.