Daily Brief Financials: Samsung Card Co, Axis Bank Ltd, Lufax Holding , Burford Capital, Biotech Growth Trust PLC/The, Encore Capital Group and more

• Investors buying on February ex-dates, perhaps due to the Value-up factor, led to a successful strategy for local managers: buying before ex-date and selling at close, yielding positive results.
• On March 19th, Kia Corp (000270 KS) diverged from February’s pattern. Notably, FINANCIAL INVESTMENT sold heavily on Kia’s ex-date, a deviation from their quiet February activity.
• FINANCIAL INVESTMENT’s trend of liquidating positions held since last quarter, especially for dividends, gains momentum as March ends, possibly overshadowing February’s Value-up factor.

• Sudden resignation of Ravi Narayanan Group-Head in charge of retail branches, retail liabilities and third party products as he wishes to pursue entrepreneurship.
• Possible explanation is that the bank like other banks is finding it difficult to raise retail deposits and pressure is building up on senior management
• Bank has a high LDR and reportedly the banking regulator is demanding the bank to lower its LDR. This will have consequences on future loan growth or on NIM

• Another quick trade idea. A continuation of the China theme (see my last post for more info).  Lufax holdings (LU). Again courtesy of JohnTill on Stocktwits.
• A Chinese lending company, lending out directly and providing a peer to peer lending platform for the Chinese market.
• With Ping An being a ~41% shareholder.

• Burford’s business model is one of capital deployment.
• The company reinvests proceeds from previous investments and raises private funds to act as asset manager.
• Although it has temporarily escaped competition, finding refuge in the high end of the market, it is unclear how sustainable their returns are.

The Biotech Growth Trust’s (BIOG’s) two co-managers, Geoff Hsu and Josh Golomb, at global healthcare specialist OrbiMed, believe that now could be an opportune time to consider the biotech sector as it is recovering from the longest and largest absolute and relative drawdown since 2006. The sector was negatively affected by sharply rising interest rates rather than a deterioration in industry fundamentals; indeed, the managers continue to refer to a ‘golden era’ of innovation within the biotech sector. BIOG’s relative performance has been through a difficult period given its high weighting in emerging (smaller-cap) biotech stocks, which performed significantly worse than the shares of large-cap biotech businesses during the sector sell-off.

• Debt buyers like ECPG can accelerate growth during times of increased charge offs by credit card issuers
• Growth is impacted by tough collections environment with an abundance of cheap charged off paper
• Investors must consider buying these stocks when growth prospects are high and expectations have factored in collection challenges, as industry may soon enter a favorable cycle for debt buyers

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.