Daily Brief TMT/Internet: Shinko Electric Industries, Taiwan Semiconductor (TSMC) – ADR, Blackcow Food Co Ltd A, Advanced Process Systems, Keywords Studios, SoundThinking and more

• When this deal was announced, it was light. But the timing, JSR influence, large-ish float, ensured FUD would make this trade wide. It traded wider.
• Nearly 6mos ago, Shinko had much-underperformed peer Ibiden, meaning downside gap risk from undisturbed was negative as spreads were wide. I reco’d a buy. Then 16+wks ago, recommended taking profits.
• Shinko had outperformed Ibiden, gross spreads had narrowed 5+% on JSR approval. Gross spread is now 4.6% but time is shorter so annualised is 10+% even out to December launch.

• Apple Increasing Chip Orders with TSMC — Expecting iPhone 16 Sales to be Much Stronger Than iPhone 15 Thanks to AI
• Google Said to be Shifting to TSMC from Samsung for Next Generation AI Mobile Phone Chips
• This June 28th piece appears to be timely — Memory Monitor: Micron’s Shares May Be Falling But Results’ Industry Implications Are Positive

• Taiwan plans to release offshore wind regulations by 3Q24, boosting the renewable energy sector’s growth and investment opportunities.
• Chinese investment in 8.6G OLED technology is boosting the South Korean display equipment industry, leading to potential economic growth.
• VinFast’s Indian factory may open earlier than expected, while mobile device suppliers show interest in using edge AI to enhance the market.

• Taiwan set to release offshore wind regulations by 3Q24, opening doors for growth and innovation in the industry.
• China’s significant investment in OLED technology boosts South Korean display equipment sector, creating opportunities for growth.
• Telecoms facing challenges with slow 5G adoption, pushing them to adapt and transform strategies to overcome obstacles.

• On 3 July, PUSU deadline, Bidco and Keywords Studios (KWS LN) have agreed to an acquisition to be carried out through a scheme of arrangement. 
• Shareholders will receive 2,450p/share in cash, cum dividend, 66.7% premium, for 22.4x Fwd P/E. There’s a minimal number of irrevocables and just 7.57% of capital in letters of intent. 
• I think the price is reasonable considering the recent challenges affecting the value of the stock, and deal will close. Spread is 2.45%/6.3% (gross/annualised, assuming settlement by 29 November). Long.

• Soundthinking (SSTI) is a SaaS company providing technology to law enforcement agencies for enhanced effectiveness
• Market cap of $200 million and trading at 2x sales, considered cheap compared to growth potential
• Company has history of 15% annual growth, 60% gross margins expected to increase with expansion, projected revenue growth of 15% over next three years, EBITDA margins expected to reach 32% by 2026, stock predicted to trade at $74 per share with 360% upside from current prices

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.