Chronux Research
The leading independent research firm in South AfricaChronux Research, founded in 2020, is an independent equity research provider focused on the South African market, with coverage spanning over ten sectors and approximately 30 companies. Within the domestic market, Chronux is particularly well recognised for its Industrials, Construction, Mid-Cap and Forestry & Paper research, where the firm combines deep sector knowledge with disciplined financial modelling and a clear, conviction-led investment framework. The team provides a global perspective on key structural and cyclical themes across the sectors covered. Chronux delivers fundamental equity research incorporating both long and short ideas with analysis driven by in-house financial models, ongoing dialogue with industry decision-makers and regular engagement with management teams. In addition to company-level research, Chronux facilitates high-level interaction with senior executives and provides access to relevant industry experts, supporting clients in forming differentiated investment views. Chronux has also been committed to developing the next generation of analysts and advancing careers within the investment industry, supported by a strong and engaged institutional client base.
Our Corporate Sponsored Coverage
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Key message: Super Group remains undervalued relative to its peers, with a solid set of results. Share buybacks should boost HEPS. Super Group released FY22 results, with HEPS in line with our expectations at 376c off a 17% and 43.8% increase in revenue and operating...
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Key message: Margins hold up well despite significant supply chain issues and cost escalations, indicating that contractual obligations to not overly place risk on Murray & Roberts. Murray & Roberts released FY22 results. Continuing HEPS recovered to 58c as...
Forestry & Paper: Industry Insights
Pulp prices stable, for now: NOREXECO pulp futures for CY 23E imply a 13-18% decline in Europe, and a decline of 11-20% in China. UWF up 1% w/w leading Graphic Paper gains: After factoring in a 30% discount to list pulp prices, the CWF/HW spread dropped by 9% w/w to...
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Key message: Toyota is back up and running and its market share bounced back. Used car prices jumped in 2Q22, but Motus report them coming back to earth in 3Q22. NAAMSA released August 2022 new vehicle sales. Passenger and LCV sales increased 14.5% YoY with passenger...
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Key message: Management warn on tough conditions in the logistics sector with the inability to pass on rising costs. OneLogix reported results for FY22 (year-end 31 May). Revenue and EBITDA increased 24% and 12% respectively, with core HEPS falling 60% to 5.4c. No...
Afrimat – Pre-Close Update
Key message: Gravenhage may have slipped through its grasp, but current operations offer better returns and new opportunities may present. Afrimat held a pre-close update for 1H FY23. The main topics were the failure to meet to conditions precedent for the Gravenhage...
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Grindrod – 1H FY22 Results Key message: Strong volumes through ports and terminals should continue as customers switch away from Transnet-linked terminals. Grindrod released 1H FY22 results. Revenue and trading profit from core operations grew by 31% and 37%...
Forestry & Paper: Textile Fibre Insights
Key w/w moves: Cotton +2%; Polyester 2%; HW DWP -5%; China-origin DWP -1%, medium-grade VSF 0%; and high-end VSF -1% and Lyocell 0%. Cotton is now trading at a 5% premium to VSF (2021 average premium: 30%) and a 99% premium to polyester (2021 average: 150%). The VSF...
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Key message: Bidcorp has weathered Covid restrictions and food inflation well – we forecast growth through organic market share, own brands and small strategic acquisitions. Bidcorp released FY22 results. Revenue increased by 28.2% (+33.1% in constant currency) and...
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Key message: Safripol margins are now at the upper end of the historic range – these will decline but importantly management’s guided range of 7-9% appears realistic. KAP released FY22 results. HEPS increased 73% to 74.4c on a 17% and 40% increase in revenue and...