In today’s briefing:
- Kenedix J-REIT Family Merger – Still Room (And Time) To Move
- Comment on Exchange Rate EUR/USD – August 4, 2023
- Utilico Emerging Markets Trust – Emerging market growth opportunities at a discount
- EML Payments – Turning the ship around
- Morning Views Asia: China SCE, Hopson Development, Sino-Ocean Service, Softbank Group
Kenedix J-REIT Family Merger – Still Room (And Time) To Move
- In mid-June, three months ago yesterday, Kenedix Office Investment Co (8972 JP), Kenedix Retail REIT (3453 JP), and Kenedix Residential Investment (3278 JP) announced a three-way merger for Nov1.
- All three popped in price, and peaked three weeks later, both outright and vs Peers. Then it fell sharply back.
- It is worth looking at the new Combined “KDX” entity on a pro-forma basis. There should be more to go.
Comment on Exchange Rate EUR/USD – August 4, 2023
- During the period under consideration, i.e. July 3rd – August 4th, 2023, the EUR/USD exchange rate was moving upwards until July 17th, 2023, but thereafter it followed a downward trend.
- However at the start of August, the Euro notched an uplift and was still trading higher than the levels in beginning of July.
- According to Graph 1, during the first twelve trading days of the period under consideration, the pair was fluctuating along the range 1.085-1.125.
Utilico Emerging Markets Trust – Emerging market growth opportunities at a discount
Utilico Emerging Markets Trust (UEM) is managed by Charles Jillings, together with deputy portfolio managers Jacqueline Broers and Jonathan Groocock, at specialist investor ICM. Jillings is frustrated by the trust’s wide discount, which he believes does not accurately reflect UEM’s strong past performance and future growth prospects. The fund has a consistently low beta and has outperformed the MSCI Emerging Markets Index over the past one, three, five and 10 years due to successful stock selection. Jillings and his team are investing in the growth potential from four megatrends: energy transition, digital infra, global trade and social infra. They seek undervalued real assets with robust growth profiles, strong cash flow generation and attractive dividend yields. Since inception in 2005, UEM’s NAV has compounded at 9.3% per year.
EML Payments – Turning the ship around
EML Payments reported FY23 revenue and underlying EBITDA ahead of the top-end of its guidance range, benefiting from higher interest income and improvements to customer contracts in H223. The company is making good progress with its short-term priorities, and while the Barrenjoey strategic review is ongoing, management has started taking action to return loss-making activities to profitability and to reinvigorate growth in its core businesses. We have upgraded our forecasts to reflect better-than-expected performance in FY23 and identified cost savings.
Morning Views Asia: China SCE, Hopson Development, Sino-Ocean Service, Softbank 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.
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