Daily Brief Industrials: Sun Kwang, Golden Energy & Resources, Sembcorp Marine, CK Hutchison Holdings, PT Wijaya Karya (Persero) Tbk, C.H. Robinson Worldwide, Equifax Inc, Carr’s Group PLC and more

• NICE I&S will likely complete the transfer schedule in early May, meaning that an ad-hoc change may occur before the regular rebalancing of the KOSDAQ 150 in June.
• If this gets completed before SK Oceanplant’s transfer listing schedule, the top reserved issue in NICE’s GICS sector (INDUSTRIALS) will be included. It is Sun Kwang (003100 KS).
• As evidenced in the case of LX Semicon, we should set up a preemptive position for potential ADDITION at the time of the T or T-1 KRX corporate action announcement.

• The Dian Swastatika Sentosa (DSSA IJ)/DSS EGM to gain shareholder approval will be held on 2 May. The DSS appraiser (unsurprisingly) opines that the Widjaja family offer is fair. 
• The appraiser valued Golden Energy & Resources (GER SP) at S$0.980. However, the valuation approach is sorely lacking, particularly for the value excluding the Golden Energy Mines (GEMS IJ) stake.
• Our SoTP valuation is S$1.29 per share, 32% above the revised offer. We continue to think another bump is required to get this deal done. 

• In this insight, we take a look at the potential index changes for Singapore’s ST index (“STI”) between now and the September 2023 index review.
• In my previous insight (link), I mentioned Sembcorp Marine (SMM SP) could miss out on being added to the STI in March 2023 and that happened to be true.
• However, based on the current data, Sembcorp Marine (SMM SP) could finally be added to the STI in September 2023.

• In-depth presentation of retail digitalization raises expectation of retail spin-off. Asset disposals and increased DPS potential 2H catalysts
• Limited impact from trade tensions; oil tailwind
• Following 2 years of single-digit earnings growth, growth is likely to accelerate to double digit as headwinds from strong euro/GBP and weak oil prices eases and global economy continues to rebound.

• Net profit up 19% YoY on strong revenue growth. New order flow remains decent.
• Maintain IDR 2,300 TP, valuations look attractive
• With a diversified portfolio of private construction and public infrastructure projects, WIKA offers broad exposure to Indonesia’s infrastructure investment growth

• This is our first report on the multinational consumer credit reporting player, Equifax.
• Their global non-mortgage businesses performed exceptionally well, with constant currency revenue growth of 12% and constant organic currency revenue growth of 10%.
• Equifax further announced the acquisition of the Food Industry Credit Bureau.

• C.H.
• Robinson is a global provider of multimodal transportation and third-party logistics service.
• Freight demand has deteriorated, negatively impacting the top-line but the contractual truckload AGP per shipment increased, which resulted in some nominal growth in their AGP per truckload shipment.

• This is our first report on C.H.
• Robinson Worldwide, a well-known provider of multimodal transportation and third-party logistics service.
• Routing guide depth of tender, a proxy for their entire market, fell from 1.3 in the third quarter to 1.2 in the fourth quarter.

• Equifax is one of the largest consumer credit reporting companies in the U.S.
• It has strong financial fundamentals which are helping it thrive in the turbulent business environment that includes an unprecedented decline in the mortgage market.
• Their global non-mortgage businesses has been performing well and is fueled by Workforce Solutions’ remarkable performance.

Carr’s Group has released its audited results for FY22, having previously issued a detailed trading update in February giving preliminary financial metrics on FY22 performance. The shares were suspended from trading in January because of delays in publishing these results. The company has applied for them to be restored to trading.