In today’s briefing:
- Toshiba (6502) – There Is Actual News, and There Are Datapoints Which Masquerade as News
- Recruit Buyback – A Temporary Support to Falling Share Price
- Bobst’s Minorities Takeout: Additional Acceptance Period
- Thailand SET50 Quiddity Leaderboard Dec 22: BJC Is the Most Interesting Name
- Energy China (3996 HK): Positive Developments in All Fronts
Toshiba (6502) – There Is Actual News, and There Are Datapoints Which Masquerade as News
- A week after JIP gets preferred status and we had rumoured bid prices, we now have an article saying JIC/Bain is still in it, and a new article today.
- Today’s “new” article says JIP’s bid price is what the first leak suggested, which is below ¥6,000/share. Other articles suggest bidders are finding that securing financing is tough.
- Investors should look at process and understand the difference between this one and most others. It matters. Some news is not news, other than telling you the dance has started.
Recruit Buyback – A Temporary Support to Falling Share Price
- Recruit Holdings (6098 JP) announced a buyback yesterday for a maximum of 42m (2.55% of total shares outstanding) shares for an aggregate of JPY150bn from the market.
- Recruit’s shares closed at JPY4,257 per share at the end of yesterday’s trading, and shares have moved up almost 5% during today’s trade following the buyback announcement.
- This is Recruit’s second buyback in 2022 where some of its shareholders reduced their stakes during the previous buyback (tender offer agreements) in January this year.
Bobst’s Minorities Takeout: Additional Acceptance Period
- JBF now controls 63.66% of the share capital of Bobst. Tendered shares represent just c.10.3%. The additional acceptance period runs until 21 October.
- The CHF 78/share offer represents 6.6x EV/Fwd EBITDA vs. 7.5x for Swiss industrial machinery peers. Unsurprisingly, the shares have been trading slightly above terms since the (opportunistic) offer announcement.
- If 3.01% of shares are tendered during the reopened period, JBF could potentially delist the company. Although this could be challenged in courts, buying above the offer price seems risky.
Thailand SET50 Quiddity Leaderboard Dec 22: BJC Is the Most Interesting Name
- In this insight, we take a look at the potential index changes for the Stock Exchange of Thailand SET 50 Index (SET50 INDEX) between now and the December 2022 Rebalance.
- There is an ongoing market consultation with significant implications for constituent selection and there is also a potential intra-review change due to the DTAC-TRUE merger.
- Based on the latest available data, there could three or four index changes during the December 2022 Rebalance depending on the outcome of the DTAC-TRUE merger.
Energy China (3996 HK): Positive Developments in All Fronts
- China Energy Engineering (3996 HK) witnessed a good acceleration in quarterly new contracts in this year. We estimate current backlog equals to 6.4x its FY21 revenue.
- It is well geared towards China’s new energy development, as reflected by a 108.3% YoY surge in new energy contracts. Its pumped storage new contract value leaped 144x in 1H22.
- The spin-off of Gezhouba Explosive in the A-share market is progressing well with approval from shareholders in Sep. The stock’s 4.1x PER and 0.33x P/B look undemanding.
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