In today’s briefing:
- STAR50 Index Rebalance: Big Impact Expected; Inclusion Up 40% in One Month
- Investors Will Again Demand Concrete Measures to Raise ROE and Boost Shareholder Returns in FY3/2025
- Classys (214150 KS): Record High Quarterly Performance in Q3; 2024 to Continue to Be Radiant
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STAR50 Index Rebalance: Big Impact Expected; Inclusion Up 40% in One Month
- As expected, the index committee has used a 6-month minimum listing history and that results in one change to the SSE STAR50 (STAR50 INDEX) in December.
- Sichuan Biokin Pharmaceutical (688506 CH) will replace Ninebot (689009 CH) in the index at the close on 8 December.
- One way turnover is estimated at 2.18% and will result in a one-way trade of CNY 3,065m. Sichuan Biokin Pharmaceutical (688506 CH) has moved up and there will be pre-positioning.
Investors Will Again Demand Concrete Measures to Raise ROE and Boost Shareholder Returns in FY3/2025
- The carryback of pension obligations and expenses resulting from higher bond yields is a factor in the increase in operating profit.
- While this’ll lead to higher EPS, which should lead to higher dividends and more room for stock price appreciation, there’s concern that inflating the B/S will lead to stagnant ROE.
- In addition, since FY3/2024 profits will be boosted by pension financing factors unrelated to the core business, lower profit growth rate in FY3/2025 will put pressure on the stock price.
Classys (214150 KS): Record High Quarterly Performance in Q3; 2024 to Continue to Be Radiant
- Classys (214150 KS) reported solid performance in 3Q23, with revenue and operating profit growing 45% and 41%, YoY, respectively, mainly driven by export in devices and domestic sales of consumables.
- Despite being an offseason, Q3 2023 witnessed increase in both the number of countries selling the new product Ultraformer MPT and the monthly average domestic sales of Volnewmer.
- Continued improvement in equipment sale and increasing consumables contribution should drive growth in 2024. Entry into the U.S. and China will be the key for re-rating of the stock.