In today’s briefing:
- Toshiba (6502) – Funding Possibly Re-Secured, Deal Possibly In Play,
- An Increasing Probability of LG Corp Preferred Shares Cancellation
- MonotaRo: Hasn’t Been This Cheap For Quite a Long Time
- Liquid Universe of European Ordinary and Preferred Shares: March ‘23 Report
- Tata Technologies Pre-IPO Tearsheet
- Rockwell Automation Inc.: Initiation of Coverage – Logix & Other Innovations
- W.W. Grainger Inc.: Initiation of Coverage – Business Strategy & Key Drivers
Toshiba (6502) – Funding Possibly Re-Secured, Deal Possibly In Play,
- Bloomberg has an article today after the close saying Toshiba Corp (6502 JP)‘s board will meet tomorrow to discuss the JIP bid, and the Special Committee will give its recommendations.
- The article suggests the Board may proceed with a vote. If they do, an announced bid could come as early as the afternoon.
- The world is quite volatile now, and funding is probably more precious today than yesterday. But a bid is too. All in all, I see no reason for a position.
An Increasing Probability of LG Corp Preferred Shares Cancellation
- In this insight, we discuss an increasing probability of the cancellation of LG Corp preferred shares.
- We provide five major reasons as to why LG Corp should cancel its entire preferred shares and how this could have a positive impact on LG Corp’s share price.
- We believe a 5-10% buyback and cancellation of LG Corp’s preferred shares in the next 1-2 years is a higher probability.
MonotaRo: Hasn’t Been This Cheap For Quite a Long Time
- After surging past 20.0x consensus FY+2 EV/OP multiple in 2012-2013, MonotaRO Co Ltd (3064 JP)’s consensus FY+2 EV/OP has fallen below 20.0x on one very rare occasion.
- We see no major change in the fundamentals of MonotaRo aside from a temporary hike in Opex through concurrently running old and new distribution centres for the past 3 quarters.
- Currently trading at 22.5x consensus FY+2 OP, we think this is a good opportunity to benefit from the company’s depressed valuation.
Liquid Universe of European Ordinary and Preferred Shares: March ‘23 Report
- Since mid-February, spreads have generally tightened across our liquid universe (9 have widened, 10 tightened, 0 at same level).
- Trade preferences long ordinary / short preferred shares: Fuchs Petrolub, Henkel, Handelsbanken, SSAB Svenska Stal.
- Trade preferences long preferred / short ordinary shares: Sixt, VW, Danieli, MFE-Media for Europe, Grifols, Atlas Copco, Ericsson.
Tata Technologies Pre-IPO Tearsheet
- Tata Technologies (TATATECH IN) is looking to raise about US$600m in its upcoming India IPO. The deal will be run by Bank of America, Citigroup and JM Financial.
- Tata Technologies is a global engineering services company offering product development and digital solutions, including turnkey solutions, to global original equipment manufacturers (OEMs) and their tier 1 suppliers.
- It has deep domain expertise in the automotive industry and serves clients in adjacent industries, such as aerospace, transportation and construction heavy machinery (TCHM), according to the company.
Rockwell Automation Inc.: Initiation of Coverage – Logix & Other Innovations
- This is our first report on Rockwell Automation, a major provider of digital transformation and industrial automation solutions across the globe.
- Rockwell Automation produced an all-around beat in its last result as organic sales and earnings both exceeded market expectations and increased year over year.
- In a very dynamic supply chain environment, organic sales were 10% higher than they had been the previous year.
W.W. Grainger Inc.: Initiation of Coverage – Business Strategy & Key Drivers
- This is our first report on W.W.
- Grainger, Inc., a global distributor of MRO materials and other related products and services.
- The company delivered an all-around beat for the final quarter of 2022 with a sales growth was 13.2% or 17.2% on a daily constant currency basis and solid growth in both segments.
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