In today’s briefing:
- Time Interconnect (1729 HK): Possible Offer
- MAJOR: Expect EBITDA to Turn Positive from 4Q21 and Onward to 2022
- Macro; Rating Changes; New Issues; Talking Heads; Top Gainers & Losers
Time Interconnect (1729 HK): Possible Offer
- Time Interconnect Technology (1729 HK) is currently suspended “pursuant to The Hong Kong Code on Takeovers and Mergers“.
- Paul Lo, the chairman, recently increased his stake to ~75% of shares out. A large parcel of shares moved into CCASS late last month.
- Paul Lo, if he is the Offeror, is unlikely to table an Offer price significantly higher than the last close, given the recent price increase. A take under is possible.
MAJOR: Expect EBITDA to Turn Positive from 4Q21 and Onward to 2022
- We expect the company’s operating performance to improve gradually from the bottom in 3Q21as there are number of quality movies to be released after been postponed upon restricted measures induced
- Expect the company to report Bt47m net profit in 4Q21, seven-quarter high in terms of core business operation
- EBITDA in 4Q21 is expected to turn positive as it driven by pent-up demand after lockdown together with impressive ticket sales from Spider-Man: No Way Home.
Macro; Rating Changes; New Issues; Talking Heads; Top Gainers & Losers
US equity markets dropped sharply with the S&P and Nasdaq ending 2.4% and 3.7% lower. Sectoral losses were led by Communication Services down 6.8%, while IT and Consumer Discretionary were down over 3%. US 10Y Treasury yields rose 7bp to 1.84%. European markets were also lower with the DAX, CAC and FTSE down 1.6% 1.5% and 0.7%. Brazil’s Bovespa closed 0.2% lower. In the Middle East, UAE’s ADX was down 0.1% and Saudi TASI closed 0.4% lower. Asian markets have opened mixed with HSI and STI up 2.4% and 0.2% while Nikkei was down 0.1%. Shanghai remains closed on account of the lunar new year holidays. US IG CDS spreads were 2.6bp wider and HY CDS spreads were 11.2bp wider. US IG CDX spreads are at its widest levels since November 2020 (see the chart below). EU Main CDS spreads were 4.6bp tighter and Crossover CDS spreads were 19.3bp wider. Asia ex-Japan CDS spreads were flat.
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