In today’s briefing:
- CIMC Vehicles (1839 HK): Vote on 18 April as Uncertainty Lingers on the 90% Acceptance Threshold
- Sinotrans (598. HK) Continues to Deliver
- Quiddity Leaderboard F100/250 Jun 24: LONG OCN – SHORT FSJ Could Be Interesting
- CIMC Enric (3899 HK): Positive Takeaways from Post-Result Call
- CIMC (1839 HK): 18th April Shareholder Vote
- Downgrading Real Estate to Underweight; Bullish Outlook Intact; Broadening Participation
- kopi-C with ISOTeam’s CEO: “Why I’m investing in both drones and professional development”
- The AZEK Company: Initiation of Coverage – Is The Robust Demand in Residential Markets Likely To Last? – Major Drivers
- Simpson Manufacturing Co.: Initiation Of Coverage – 4 Pivotal Factors Shaping Its Growth Trajectory! – Financial Forecasts
CIMC Vehicles (1839 HK): Vote on 18 April as Uncertainty Lingers on the 90% Acceptance Threshold
- CIMC Vehicle Group Co Ltd (1839 HK) has despatched the offer document, and the H Share HK$7.50 offer is open. The H Shareholders class vote is on 18 April.
- The key condition is approval by at least 75% of independent H Shareholders (<10% of all independent H Shareholders rejection) along with a 90% minimum acceptance condition.
- The de-rating of peers and ongoing US investigation favours meeting the 90% threshold. However, the dire minority AGM/EGM participation rates suggest that retail apathy may derail the offer.
Sinotrans (598. HK) Continues to Deliver
- Cost and business optimisations lead to increased profits as revenues drop due to freight rate declines
- Successfully pivoting by geography as the global trading environment changes
- The company increases its dividend payout in a sign of confidence for the future
Quiddity Leaderboard F100/250 Jun 24: LONG OCN – SHORT FSJ Could Be Interesting
- In this insight, we take a look at the potential index changes for F100 and F250 in the run-up to the June 2024 index rebal event.
- There could be up to three intra-review changes for the F250 index during the next two months.
- Separately, there could be one change for F100 and two changes for F250 during the regular rebalance in June 2024.
CIMC Enric (3899 HK): Positive Takeaways from Post-Result Call
- Despite weaker 2H23 results, CIMC Enric Holdings (3899 HK) guided for solid recovery in FY24. Order backlogs reached Rmb22.9bn, which almost equals the full-year revenue.
- Clean energy segment will be supported by vessel demand, hydrogen orders, and Angang Steel project contribution. Chemical and environmental segment should rebound in 2H24.
- Liquid food spin-off is in process and it has won several domestic whiskey projects. As net cash equals 13% of share price, payout will be maintained at 50% (FY22: 40%).
CIMC (1839 HK): 18th April Shareholder Vote
- On the 11th March, SOE-backed CIMC Vehicle Group Co Ltd (1839 HK) announced a firm Offer at HK$7.50/H-share from its major shareholder, CIMC Group. Terms are final.
- CIMC Group holds 74.24% of the H-shares and will abstain from voting at the H-share class meeting. 14.21% of the remaining 25.76% H-shares have given irrevocables supporting the Offer.
- The Circular is now out. The shareholder vote is the 18th April. Payment is the 13th May, IF unconditional on the first close. This looks done.
Downgrading Real Estate to Underweight; Bullish Outlook Intact; Broadening Participation
- Our bullish outlook initiated on November 7, 2023 remains intact; this intermediate-to-long-term outlook is likely to stay in place as long as 4800 support holds on the SPX (7-10% downside).
- To be clear, we aren’t calling for a pullback to 4800; we view it as a worst-case scenario for the S&P 500, and we want to be prepared for anything.
- Shorter-Term, we remain bullish on the S&P 500 and Nasdaq 100 (QQQ) as they both refuse to close below their 20-day MAs for more than 2-3 consecutive days.
kopi-C with ISOTeam’s CEO: “Why I’m investing in both drones and professional development”
- kopi-C with ISOTeam’s CEO: “I’m investing in both drones and professional development” For people who live in Housing Development Board (HDB) flats in Singapore, drones may soon become a common sight.
- ISOTeam, which specialises in maintaining and upgrading buildings, has been using drones for façade inspections since 2021.
The AZEK Company: Initiation of Coverage – Is The Robust Demand in Residential Markets Likely To Last? – Major Drivers
- This is our first report on the AZEK Company, leading manufacturer of eco-friendly building products.
- The company reported an 11% net sales increase year-over-year in Q1 2024.
- Excluding the recently divested Vycom business, net sales increased 22% year-over-year, driven by the strong performance of its residential sector.
Simpson Manufacturing Co.: Initiation Of Coverage – 4 Pivotal Factors Shaping Its Growth Trajectory! – Financial Forecasts
- This is our first report on building construction product manufacturer, Simpson Manufacturing Company.
- The company showcased strong execution in 2023 amid a challenging year, outperforming the housing market via robust customer demand and expansion of production lines.
- With annual net sales of $2.2 billion, a 21.5% operating income margin, and a record $8.26 of earnings per diluted share, the company emerged resilient.
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