In today’s briefing:
- HKBN (1310 HK): Just How Likely Is An I Squared Offer?
- LG CNS IPO Details Out: My Read on This IPO
- LG CNS IPO Preview
- S&P500 December 2024 Forecast (Final): Flipping the COIN
- Super Micro Computer (SMCI): Investigation Clears Fraud Claims, But Is the Stock Still a Risk?
- Tech Supply Chain Tracker (06-Dec-2024): Unisoc gets $448M to enhance 5G chip development.
- Waystar IPO Lock-Up: CPPIB and EQT Recorded Large Gains Since IPO and $2.7B Deal With Bain Capital
- Intel CFO @ UBS Global Technology Conference “Core Strategy Remains Intact”
- Microchip Hits Pause on CHIPS Act Funds & Faces Big Challenges: A Red Flag For Investors?
- Greenidge Generation Holdings, Inc. – First Large-Scale Data Center Sale and Partnership Announced
HKBN (1310 HK): Just How Likely Is An I Squared Offer?
- Two hours before China Mobile’s pre-conditional voluntary Offer announcement on the 2 December, HKBN Ltd (1310 HK) flagged a possible separate Offer from I Squared Asia-backed HGC Global Communication (HGC).
- No price was mentioned, although HKBN and I Squared “are in discussions on the terms of the proposal (including the price).” The media is reporting a HK$5-HK$6/share price range.
- Apart from anti-competition concerns via a HKBN/HGC tie-in; would HGC even get approval from the powers that be to proceed with a merger?
LG CNS IPO Details Out: My Read on This IPO
- The KRW 5T-6T valuation and 13x-16x PER look solid compared to local peers like SDS and Hyundai AutoEver, with CNS possibly getting a premium due to its smaller captive stake.
- Instos probably won’t push hard for lock-ups but will aggressively target pricing to secure larger allotments, knowing the company is likely to stick with a market-friendly price.
- On a separate note, I wouldn’t expect much of a NAV discount reduction for LG Corp, as LG CNS’s stake isn’t significant enough to move the needle.
LG CNS IPO Preview
- The long awaited IPO of LG CNS is finally getting ready to be completed in February 2025. The IPO price range is 53,700 won to 61,900 won.
- Expected market cap is between 5.2 trillion won to 6.0 trillion won. At the high end of the IPO price range, the total IPO offering would involve 1.2 trillion won.
- The bankers used three companies including Samsung Sds, Hyundai Autoever, and NTT Data Corp as comps. This is expected to be one of the largest IPOs in Korea in 2025
S&P500 December 2024 Forecast (Final): Flipping the COIN
- Coinbase Global (COIN US) can be the unexpected addition by transition because of a high liquidity score and a close distance below the estimated transition threshold.
- Lennox International (LII US) is the main candidate for addition by migration due to having the highest average mcap score and passing eligibility metrics.
- Illumina Inc (ILMN US) has a muted conviction for addition because of ineligible earnings and a recent deletion from the index.
Super Micro Computer (SMCI): Investigation Clears Fraud Claims, But Is the Stock Still a Risk?
- Super Micro Computer (SMCI) has been in the spotlight recently, with its stock experiencing wild swings amid developments that have left investors divided.
- On one hand, a special committee investigation concluded there was no evidence of fraud or misconduct, a finding that alleviated fears sparked by Ernst & Young’s resignation as its auditor.
- This positive news was coupled with robust growth in AI-driven revenues, innovative liquid-cooled server solutions, and ambitious manufacturing expansion plans.
Tech Supply Chain Tracker (06-Dec-2024): Unisoc gets $448M to enhance 5G chip development.
- Unisoc secures US$448M in funding to improve development of 5G chips, highlighting the growing importance of 5G technology in the tech industry.
- India aims to attract more electric vehicle manufacturers by expanding incentives, signaling a push towards sustainable transportation solutions.
- Nvidia collaborates with Thailand on AI despite challenges in the data center ecosystem, showing commitment to advancing AI technology globally.
Waystar IPO Lock-Up: CPPIB and EQT Recorded Large Gains Since IPO and $2.7B Deal With Bain Capital
- Waystar Holding, American provider of mission-critical cloud software to healthcare organizations, completed its IPO in June and raised ~$968M to repay outstanding indebtedness.
- Waystar Holding shares have outperformed the Nasdaq Composite Index (+31.5%) in 2024 with shares up ~44% year-to-date. IPO investors are also up ~44%.
- I expect downward pressure on the stock as IPO lock-up period ends on December 6th, 2024, and all ~176M Waystar Holding shares will be eligible for trading.
Intel CFO @ UBS Global Technology Conference “Core Strategy Remains Intact”
- Earlier this week, at the UBS Global Technology Conference, Intel CFO and co-interim CEO David Zinsner declared that the company’s “core strategy remains intact”
- Recently onboarded GM of IFS Dr. Naga Chandrasekaran, explained that while 18A remains on track, there are still “many milestones” to be met before it ramps in H225
- He also admitted that 18A is more geared towards HPC, is skewed in favour of Intel Products and that 14A will likely be more suitable for the broader semiconductor ecosystem
Microchip Hits Pause on CHIPS Act Funds & Faces Big Challenges: A Red Flag For Investors?
- Microchip Technology reported its second-quarter fiscal year 2025 financial results amidst a challenging macroeconomic environment.
- The company faced a sequential net sales decline of 6.2% to $1.164 billion.
- Excluding a $13.3 million benefit from the settlement of a legal matter with a licensee, net sales declined by7.3%.
Greenidge Generation Holdings, Inc. – First Large-Scale Data Center Sale and Partnership Announced
- Greenidge announced today that it has entered into a definitive agreement to sell its 152-acre Spartanburg, SC property Data Journey for $12.1 million in cash and an 8% profit participation interest in the property’s planned data center.
- Greenidge will provide support to Data Journey in the site development and buildout.
- Greenidge CEO Jordan Kovler said, “Today marks an exciting step forward for Greenidge as our South Carolina property sale to Data Journey represents our first large- scale entrance into the data center space.”
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