In today’s briefing:
- Collapse of Silicon Valley Bank (SVB) – Impact on Korean Banks
- China Healthcare Weekly (Mar.10)- Three Conditions to Be Biopharma, Anticipate the Collapse, DS-8201
- GEM Weekly (10 Mar 2023): China GDP, South Korea Inflation, Malaysia Interest Rates; Kakao Corp
- China Auto: ICE Price War Triggered by Dongfeng, JV Players Under Pressure
Collapse of Silicon Valley Bank (SVB) – Impact on Korean Banks
- On Friday 10 March, Svb Financial (SIVB US) suddenly collapsed, becoming the largest bank to fail in the United States since the 2008 financial crisis.
- In our view, the collapse of SVB Financial will likely have a negative near-term impact on the Korean banks.
- Three ways that this will negatively impact Korean banks include risk-off investment sentiment, greater excuse to hold on to cash by Korean banks, and lower interest rate spreads.
China Healthcare Weekly (Mar.10)- Three Conditions to Be Biopharma, Anticipate the Collapse, DS-8201
- The successful transformation of biotech into large pharmaceutical enterprises needs to meet three conditions, but many biotech enterprises could actually meet only the requirements of the first two.
- If investors cannot understand the basic logic of marketing in China pharmaceutical industry, they would never understand or “anticipate” the future potential collapse of valuation of some companies.
- The barriers formed by DS-8201 deserve investors’ attention. For those ADC players that are in the range of head-to-head competition with DS-8201, they should at least “revise the story” .
GEM Weekly (10 Mar 2023): China GDP, South Korea Inflation, Malaysia Interest Rates; Kakao Corp
- The Global Emerging Markets weekly provides a summary of the key news and related developments impacting the largest countries and constituents of the Global Emerging Markets equity indices.
- Macro data points: Chinese growth targets and inflation, South Korean inflation, Malaysian interest rates
- Companies mentioned:Kakao Corp (035720 KS), S.M.Entertainment Co (041510 KS), HYBE (352820 KS)
China Auto: ICE Price War Triggered by Dongfeng, JV Players Under Pressure
- Dongfeng announced 12%-35% subsidy on its retail price to reverse weak sales which has seen most of its factories suspending production
- This has triggered a price war with more than 30 brands joining with similar ranges of price discounts/subsidies, most of which are JV brands – some upto 50%
- We see a possibility that some of the JV brands exit China this year
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