In today’s briefing:
- NTT (9432) – LDP Consideration of Full Sale Is Not Necessarily Overhang
- TSMC. AI Tailwinds No Match For Macro Headwinds
- LianLian DigiTech IPO: The Bull Case
- Quiddity Leaderboard SET50 Dec 23: DELTA Deletion Fears Unrealistic
- Alphabet 2Q’23 Earnings Update
- Alphawave, TSMC and Lam Research Follow-up, DISCO and Lasertec
- APLD – 4Q Review
- Black Sesame Pre-IPO – The Negatives – Losses Remain Wide and Suffers from a Concentration Risk
- Robosense Technology Pre-IPO – The Negatives – Not a Whole Lot of Earnings
- Schrole Group Ltd – Another Record Quarter, Closing in on Break Even
NTT (9432) – LDP Consideration of Full Sale Is Not Necessarily Overhang
- Six weeks ago, LDP Policy Research Council chairman KAGIUDA led a discussion about full NTT privatisation to fund defence. Today he said serious deliberations begin in August. Shares fell today.
- The LDP wants non-tax resources to increase defence/social spending. Selling would require a change in NTT Law, but the argument is that communications have changed/internationalised.
- As discussed in NTT (9432 JP) – Would the Govt Sell All Its Shares? Why? How? How Long? Overhang?, there are questions on overhang. BUT… presumably there are mitigants.
TSMC. AI Tailwinds No Match For Macro Headwinds
- Persistent fabless inventory issues dampen the slope of H2’23 recovery. FY’23 forecast further reduced to a 10% YoY decline
- AI-Related hardware will reach 6% of revenues in 2023, a welcome boost but insufficient to counter the negative impact of macro headwinds
- TSMC’s earnings provides an important read through on the likely results and outlook for the broader semi ecosystem in the coming weeks.
LianLian DigiTech IPO: The Bull Case
- Lianlian DigiTech (2104619D CH), a digital payment services provider in China, has filed for an HKEx IPO to raise US$500 million, according to press reports.
- Lianlian ranked first among the independent digital payment solution providers in China in terms of TPV in 2022, with a market share of 9.1%, according to Frost & Sullivan.
- The key elements of the bull case rest on rising market share, doubling of active customers, resilient core business growth and rapidly growing additional revenue streams.
Quiddity Leaderboard SET50 Dec 23: DELTA Deletion Fears Unrealistic
- In this insight, we take a look at the potential ADDs/DELs for Thailand’s SET50 index rebalance in December 2023.
- Delta Electronics Thai (DELTA TB) – one of the largest SET 50 members – has been in the Market Surveillance Measure list a couple of times already this year.
- Although this creates some doubts over the fate of DELTA’s SET50 membership, at present, I believe DELTA will escape deletion in December 2023.
Alphabet 2Q’23 Earnings Update
- Topline grew +9% FXN. While Google Services revenue growth was flat in 1Q’23, it was 5.5% YoY in 2Q’23, with growth re-accelerating in every component of Google Services.
- Despite cost optimization efforts by customers, Google Cloud maintained its momentum with ~28% YoY growth (same as it was in 1Q’23).
- So, on an apple-to-apple basis, Google Services margin would be slightly lower this quarter than reported (say, ~$500 Mn opex for Google Brain).
Alphawave, TSMC and Lam Research Follow-up, DISCO and Lasertec
Alphawave reported last week.
The results were not good; they were great.
I actually am excited to see Tony and the team execute like this. Bookings are growing, and while revenue has not come out yet, it seems very likely they will hit their 2023 revenue estimates.
APLD – 4Q Review
- APLD released 4Q earnings last night. The stock performed well, +14%.
- The key highlight was the huge guidance. In this post I will run through how the numbers make no sense.
Jamestown, North Dakota (JT) – 100MW – JT has been operating since 2022. It has ~100MW of capacity and has been running at full capacity over the past two quarters, according to comments made on the company’s 3Q and 4Q earnings calls. Here is a snip for the 3Q call.
Black Sesame Pre-IPO – The Negatives – Losses Remain Wide and Suffers from a Concentration Risk
- Black Sesame Technologies (BLACKSES HK) is looking to raise around US$300m in its upcoming Hong Kong IPO.
- Black Sesame International Holdings (BSIH) is an automotive-grade computing SoC and SoC-based intelligent vehicle solution provider.
- In this note, we will talk about the not so positive aspects of the deal.
Robosense Technology Pre-IPO – The Negatives – Not a Whole Lot of Earnings
- Robosense Technology (ROBO HK) (RT) is looking to raise around US$400m (estimated) in its upcoming Hong Kong IPO.
- As of Mar 23, it had earned design wins for mass production of LiDAR for 52 vehicles with 21OEMs and Tier 1 suppliers, ranking No. 1 globally, according to CIC.
- In this note, we talk about the not-so-positive aspects of the deal.
Schrole Group Ltd – Another Record Quarter, Closing in on Break Even
- Schrole Group Ltd (ASX:SCL) is an Australian software company focused on providing human resource technology solutions to the international education and training sector.
- Schrole has developed a suite of five HR Software-as-a-Service (SaaS) offerings including the core product, Schrole Connect, a SaaS-based staff recruitment platform.
- Schrole Group has reported a 24% increase in quarter-on-quarter cash receipts to $1.32m and a narrowed operating cash loss of $0.20m, a 39% reduction when compared with the same quarter a year ago. Schrole Group ended the quarter with cash of $1.36m and no debt.
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