In today’s briefing:
- BEW Bumps Effective Stake In BEURG (3718 HK)
- Shinko Electric (6967 JP): Reality Check – Risk on the Downside
- ComplyAdvantage: Automating Customer Onboarding and Payments While Reducing Risk
- Daikin – Steady Volume Growth And Price Hikes But Expensive
- JWD: Expect Solid Earnings Growth from 2Q22 and Onwards to 2H22
- Turtle Creek Q1 2022 Manager Commentary
BEW Bumps Effective Stake In BEURG (3718 HK)
- Beijing Enterprises Water Group (371 HK) (BEW) has effectively increased its stake in Beijing Enterprises Urban Resources (3718 HK) (BEURG) after entering into Acting In Concert agreements (AIC).
- Parties to the AICs “irrevocably and unconditionally” undertake to vote in the same manner as BEW in BEURG shareholder meetings.
- There was no update on the timing of the MGO, which is expected to open for tendering on the 20 May.
Shinko Electric (6967 JP): Reality Check – Risk on the Downside
- Shinko may look attractively valued, but it is highly geared to a slowdown in demand. Rising materials costs and depreciation accentuate downside gearing.
- Management is guiding for another year of strong sales growth, but may be ignoring the possibility of a decline in remote-work and other COVID-related demand.
- Rolling over, but still up 6.7x since March 2020. Not worth the risk in the current environment.
ComplyAdvantage: Automating Customer Onboarding and Payments While Reducing Risk
- ComplyAdvantage (1448975D LN) uses machine learning to provide accurate data on the connections between individuals and business entities.
- The company has entered into a number of strategic partnerships which have helped it grow revenues.
- The growth of financial crime and money laundering is likely to drive ComplyAdvantage revenues over the medium-term.
Daikin – Steady Volume Growth And Price Hikes But Expensive
- Continuing a now familiar theme for manufacturers Daikin’s 4QFY22 revenue beat consensus by 9.8% but raw material prices restricted OP to meagre 0.3% beat.
- FY23 guidance is also mixed as they expect strong revenue of ¥3,380bn (+5.9% vs. consensus, +8.7% YoY) but weak OP of ¥340bn (-2.9% vs. consensus).
- We believe price hikes could be bigger than projected and the weak yen will help but multiples remain elevated.
JWD: Expect Solid Earnings Growth from 2Q22 and Onwards to 2H22
- We reiterate a BUY rating but trim down target price to Bt20.0 (Previous TP: Bt22.20) after revised down earnings in 2022E by 10%.The target derived from 37xPE’22E, its +1.0 S.D.
- Expect solid performance for logistics and warehouse businesses from 2Q22 onward to 2H22
- Anticipate shared profit from Transimex(Vietnam)to gradually drop from high base in 4Q21which will be pressured by decreasing global freight rate but the impact is likely to be offset with profit
Turtle Creek Q1 2022 Manager Commentary
- Turtle Creek is an independent investment management firm focused on long-term capital growth for a clientele of high-net-worth individuals, families and institutions.
- During the quarter, the net asset value of the Turtle Creek Equity Fund (“TCEF”) declined 10.4%.
Before it’s here, it’s on Smartkarma
