Daily BriefsIndustrials

Daily Brief Industrials: S&P 500, Schneider Electric Infrastructure, Cie De Saint-Gobain, HNI Corp, Kimball International B, UBTech Robotics and more

In today’s briefing:

  • EQD | SPX Vs SX5E: Trade a Relative Value Vol Spread
  • Schneider Electric Infra Ltd (SEIL)- Forensic Analysis
  • Cie De Saint-Gobain: +17% Since Our Initial Note. Fantastic Results Confirm Our Bull Case.
  • Margin Improvement Evident in 4Q22; Sales Headwinds Remain into 2023
  • Kimball International, Inc. (Nasdaq: Kbal) – Initiating Coverage
  • UBTech Robotics Pre-IPO Tearsheet

EQD | SPX Vs SX5E: Trade a Relative Value Vol Spread

By Simon Harris

  • European markets have begun to outperform their US peers over last few months
  • The differences in market sentiment have driven both the implied and realised vol spread wider 
  • Trade a relative vol spread that should hold up in multiple market scenarios

Schneider Electric Infra Ltd (SEIL)- Forensic Analysis

By Nitin Mangal

  • Schneider Electric Infrastructure (SCHN IN) is engaged in manufacturing of products and systems for electricity distribution, such as distribution transformers, medium voltage switchgears, etc.
  • After plagued with losses for most of last decade, the company has entered into positive net worth and profit territory. 
  • However, forensics do indicate concerns on aspects such as borrowing rates, inventory verification, contingent liability, etc. including few governance woes.

Cie De Saint-Gobain: +17% Since Our Initial Note. Fantastic Results Confirm Our Bull Case.

By Alexis Dwek

  • All financial performance indicators at a record high in 2022 (growth, operating income, margin, recurring net income, free cash flow, ROCE)
  • Transformation going according to plan, group’s profile towards fast-growing markets
  • Valuation remains cheap on our model – still upside from here. TP: €72

Margin Improvement Evident in 4Q22; Sales Headwinds Remain into 2023

By Water Tower Research

  • Before market open on February 23, HNI reported 4Q22 results that were better than we expected on both the top line (a modest beat) and margins (a significant beat).
  • Results were also ahead of consensus. HNI reported 4Q22 sales of $569 million versus $603 million in 4Q21, ahead of our estimate by $7.5 million and consensus by $9 million.
  • Adjusted EPS was $0.63, or $0.17 ahead of our estimate of $0.46 (also consensus).

Kimball International, Inc. (Nasdaq: Kbal) – Initiating Coverage

By Water Tower Research

  • We are initiating research coverage of Kimball International. For shareholders and potential investors, Kimball’s relevant history began in 1949 when Arnold Habig led the acquisition and reorganization of Midwest Manufacturing, a struggling manufacturer based in Jasper, Indiana.
  • Kimball management initiated its current strategy in 2014, focusing exclusively on commercial furniture.
  • Its strategy differs from other commercial furniture manufacturers by emphasizing ancillary products (88% of TTM revenues as of 2Q23) and concentrating on secondary geographic markets (79% of TTM revenues as of 2Q23).

UBTech Robotics Pre-IPO Tearsheet

By Ethan Aw

  • UBTech Robotics (1683374D HK) is looking to raise about US$700m in its upcoming HK IPO. The deal will be run by Guotai Junan.  
  • UBTech Robotics is engaged in artificial intelligence (AI)-empowered robotics in China, dedicated to the innovation of humanoid robots and development and sales of smart service robotic solutions. 
  • It has a full stack of proprietary robotic, AI and integrated robotic and AI technologies for application in a range of enterprise-level and consumer-level use scenarios across various sectors.

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