Daily Brief Industrials: Doosan Robotics , Canvest Environmental Protection Group, Keisei Electric Railway Co, JUNJIN Construction & Robot, Duratec Ltd, Sunrun Inc, CMA CGM SA, Nitto Kogyo, Kbr Inc, bpost SA and more

• The restructuring plan of Doosan Group announced today primarily consists of two merger events aimed at transferring the stake in Doosan Bobcat held by Doosan Enerbility to Doosan Robotics.
• The 50% price cut on Doosan Enerbility’s share price for merging with Doosan Robotics boosts Robotics’ advantage. This resulted in a swap spread opening with Doosan Bobcat.
• Considering an arbitrage strategy in the Doosan Robotics and Doosan Bobcat swap needs caution due to shareholder approval risks, especially with Doosan Enerbility’s low controlling stake potentially complicating the process.

• Since waste-to-energy play Canvest Environmental Protection (1381 HK) announced a possible privatisation from Grandblue Environment (600323 CH) at $4.90/share (a 20.7% premium to undisturbed), shares are up just 6.4%. 
• There’s a lot to pack in here, not the least being this is an indicative Pre-Conditional Offer.
• But the fact the announcement mentions rolling over a specific number of shares of the controlling shareholders (7.23%), suggests negotiations are well advanced. So we explore.

• A week ago, the Keisei Electric Railway Co (9009 JP) AGM took place. The activist which had proposed a shareholder resolution saw ISS and Glass Lewis support.
• But that was to no avail as the shareholder proposal got 29.89% of the votes, and 26.15% of total voting rights. This likely informs the near-term future of such proposals.
• I expect the ask needs to change, and the agenda item needs to be difficult to be against. 

• Junjin Construction & Robot is getting ready to complete its IPO in KOSPI in August. The IPO price range is from 13,800 won to 15,700 won. 
• The IPO offering is from 42.5 billion won to 48.3 billion won. The book building for the institutional investors is from 30 July to 5 August. 
• The integration of robotics into construction processes is a cornerstone of Junjin’s operations. Its main product is the concrete pump vehicle which pumps cement or concrete at a construction site.

• Duratec Ltd (DUR AU) with strong financials, a robust order pipeline and ability to leverage technologies makes it a solid small-cap infrastructure maintenance and asset protection play
• Shares are at least 30% below fair value given profitability, growth and order book profile. Historical numbers suggest solid execution of a diverse service contract portfolio. 
• Duratec is a play on growing need for more efficient, accurate and  innovative approach for proactive infrastructure inspections and maintenance. 

• Sunrun reported a dynamic first quarter of 2024, marked by a strategic emphasis on storage installations complemented by solar capacity, reflecting a broader company transformation towards a storage-first business approach.
• During the period, Sunrun surpassed its guidance expectations for both solar and storage installations, with storage systems installed on 50% of new residential customers, a significant increase from the prior year.
• This surge in storage adoption has notably bolstered the company’s margin profile since storage installations tend to carry higher margins compared to traditional solar-only setups.

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
We assess CMA CGM’s ESG as “Adequate”, in line with its Environmental and Governance pillars, while the Social pillar is “Strong”. Controversies are “Immaterial” and Disclosure is “Adequate”. The group notably received a CDP score of A- for 2023.

• NITTO KOGYO Corporation (hereafter, the Company) announced its earnings results for FY2024/3 on May 15, 2024.
• In addition to posting record net sales, the Company recorded profit growth for all three of its segments.
• While the price of raw materials and parts rose, the Company’s gross profit margin improved 1.4 ppt YoY to 26.8%. 

• KBR Inc. reported a strong start to the fiscal year 2024, with key performances in safety, financial metrics, and strategic operations showing promising signs.
• The company saw a 7% year-over-year increase in consolidated revenues, reaching $1.8 billion, a record since their transformation in 2020.
• Adjusted EBITDA also surpassed expectations, improving by 14% year-over-year with a boost in margins.

• Decline in traditional mail delivery business
• Challenges from declining mail volumes, regulatory constraints, and failed diversification attempt
• New management, focus on efficiency, and parcels business expansion leading to potential growth for bpost

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.