In today’s briefing:
- NetEase (9999 HK): Steady Without New Games in 1Q22 and New Games in Pipeline, Buy
- UMC (UMC.US; 2303.TT): 3Q22 Order Is Full- The Demand from Asia Is Turning Weak, but US Is Stronger
- Britannia Industries (BRIT IN) | Time for a Good Snack
- Imeik Technology Development (300896.CH) – Superficial Prosperity Hardly Masks Underlying Risks
- Otsuka Holdings (4578 JP) 1Q22: Global Products Continued Double-Digit Revenue Growth
- Penny Stock Philippine Tech Gambling Company DFNN Has First Mover Position in Fast Recovering Market
NetEase (9999 HK): Steady Without New Games in 1Q22 and New Games in Pipeline, Buy
- Total revenue grew by 15% YoY and operating margin improved YoY in 1Q22.
- The authorities began to grant licenses and new games will be launched in China and overseas.
- We set an upside of 25% and a price target at US$120. Buy.
UMC (UMC.US; 2303.TT): 3Q22 Order Is Full- The Demand from Asia Is Turning Weak, but US Is Stronger
- We believe UMC’s 3Q22 order is full, but the growth could be within 3% QoQ.
- Asian clients are turning weak, and US clients are getting stronger.
- The mainland China demand could be making an impact because of the COVID-19 pandemic.
Britannia Industries (BRIT IN) | Time for a Good Snack
- Aggression in adjacencies, market share gains and under indexed rural exposure presents an opportunity.
- COGS Inflation, Risk of downgrading in case of a further hike loom and is a potential risk.
- YTD Britannia Industries (BRIT IN) is an outperformer and could remain so.
Imeik Technology Development (300896.CH) – Superficial Prosperity Hardly Masks Underlying Risks
- Imeik keeps its outstanding financial performance in 2021/2022Q1. On the surface, it looks prosperous, but its development strategy, product layout and resilience in front of risks would bring many uncertainties.
- Considering the pandemic/lockdown and a slowing economy in China, the revenue growth in 2022 could fall to about 50%, then to about 40% and 30% in 2023 and 2024 respectively.
- Imeik’s valuation is “unreasonably high”, which is expected to be lower than Bloomage in the future. Anything that deviates from fundamentals would inevitably return to the origin.
Otsuka Holdings (4578 JP) 1Q22: Global Products Continued Double-Digit Revenue Growth
- Otsuka Holdings (4578 JP) started 2022 on a strong note, with 13% y/y revenue growth in Q1. Growth was driven by four global products, which contributed 36% of total revenue.
- Otsuka has terminated its global license agreements with Akebia Therapeutics related to vadadustat for the treatment of renal anemia and recorded an impairment loss of ¥24 billion.
- Despite the impairment losses related to vadadustat, Otsuka reiterated 2022 guidance and expects double-digit growth in operating and net profits.
Penny Stock Philippine Tech Gambling Company DFNN Has First Mover Position in Fast Recovering Market
- Launched in late 2020, inPlay.ph is the first pure play online real money gambling platform aimed at attacking revenue of illegal sites.
- DFNN is also licensed for electronic gaming machines, a sports betting exchange and pari-mutuel betting for the government run Pagcor sector.
- Income from interactive tech platforms including the online gaming unit increased 116.6% for the quarter to 229.3m php.
Related tickers: NetEase Inc (NTES.O), United Microelectronics Corp (2303.TW), Britannia Industries (BRIT.NS), Otsuka Holdings (4578.T)
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