In today’s briefing:
- Delta Taiwan Vs. Thailand Monitor: SET50 Re-Inclusion Surge, Biggest Diversion in History
- GoTo: Going Gets Tough
- Hon Hai 4Q22 Results Preview: Brace for a Weak Print, But EV Structural Driver Intact
- Taiwan Tech Weekly: Samsung Results; Will Bleed Competitors; Japan & Holland Join China Chip Ban
- Harvest Technology Group Limited – Sales Moving up the Curve
Delta Taiwan Vs. Thailand Monitor: SET50 Re-Inclusion Surge, Biggest Diversion in History
- Delta Thailand has surged post SET50 re-inclusion and the stock has dramatically outperformed both Delta Taiwan and Thailand’s SET Index.
- For both stocks, forward growth rates are expected to be similar for 2023E and 2024E.
- Delta Taiwan’s stake in Delta Thailand alone is now worth nearly 90% of its market cap.
GoTo: Going Gets Tough
- GoTo’s share price lost more than 75% last year following its weaker-than-expected performance and lock-up expiry despite the company entering into a coordinated secondary offering of shares with pre-IPO shareholders.
- The company’s share price has moved up 24% YTD partially driven by cost cutting measures that is expected to improve the company’s profitability.
- Nevertheless, we expect this share price rebound to be temporary with e-commerce and food delivery market in Indonesia slowing down.
Hon Hai 4Q22 Results Preview: Brace for a Weak Print, But EV Structural Driver Intact
- Hon Hai’s upcoming results date hasn’t yet been publicly announced, but last year it was 16 March.
- Gross margin could come in well below consensus, and net profit could be minimal for 4Q22E. Look for reiteration of its longer-term margin target from management.
- We remain structurally bullish on Hon Hai and see it as positioned favorably relative to U.S. China semiconductor restrictions. Our TP for Hon Hai is $155, over 50% above today.
Taiwan Tech Weekly: Samsung Results; Will Bleed Competitors; Japan & Holland Join China Chip Ban
- Samsung reported 4Q22 detailed results – Semiconductor earnings evaporated and its memory subsegment likely lost money.
- Samsung re-iterated that it would NOT cut capex despite the market downturn – Samsung appears ready to endure losses which is negative for Nanya Tech, SK Hynix, and Micron.
- Japan and the Netherlands have joined the U.S. with chip technology restrictions for China – Hon Hai is a net winner.
Harvest Technology Group Limited – Sales Moving up the Curve
- Harvest Technology Group Limited (ASX:HTG) licenses its proprietary video compression and encryption technology for low-bandwidth, high-latency applications needing secure real-time streaming video communication.
- The company delivers solutions for data transfer from anywhere via satellite or congested networks.
- Harvest offers a solution which enables real-time monitoring of remote locations, real-time feedback for field technicians, and secure video conferencing.
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