Chronux Research

The leading independent research firm in South Africa

Chronux 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

Making It Possible

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Key message: Relaxations from lenders on debt reduction targets signal Nampak is emerging from its balance sheet challenges.   Nampak recently released 1H FY22 results, with HEPS up 102% to 35.6c on a 24% and 9% increase in revenue and trading profit respectively....

Forestry & Paper: Industry Insights

Pulp prices stable, for now: NOREXECO pulp futures for CY 23E imply a 12-18% decline in Europe, and a decline of 11-20% in China. Ence’s 515ktpa BEK mill in Pontevedra, which had to suspend operations in late July due to drought conditions cannot be restarted until...

Forestry & Paper Textile Fibre Insights

Key w/w moves: Cotton +7%; Polyester 0%; HW DWP 0%; China-origin DWP 0%, medium-grade VSF -2%; and high-end VSF -1% and Lyocell -1%. Cotton is now trading at a 2% premium to VSF (2021 average premium: 30%) and a 93% premium to polyester (2021 average: 150%). The VSF...

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Key message: Strong local demand for paper continues, but cost pressures will force a large price increase in October 2022. Management aim to maintain profitability but margins may decline. Mpact released 1H FY22 results. Revenue increased 5.2% on an 1% decline in...

Liberty Two Degrees – 1H FY22 results and valuation update

Key message: despite a recovery in footfall and turnover in its retail portfolio, L2D’s relatively soft financial performance continues to disappoint. We fail to see any meaningful catalyst that could lead to the share re-rating. 1H FY22 results in line: DPS was...

Cement Import Monitor: Apr-Jun 2022

Key message: Cement imports for April-June 2022 are 39% down on 2021 levels, indicating a possible decline in imports as port conditions normalise. April to June 2022 saw imports of 171kt, down 39% from the same period in 2021. The 12-month rolling annual import level...

Sappi: Q3 22E Insights

Q3 22E results on Thursday 4 August, key numbers to look out for: We expect EBITDA to improve by 121% y/y to USD 320mn (-5% q/q) and EPS of USD 0.33/share. We expect Graphic Paper to surprise to the upside. DP is likely to disappoint on the back of continued logistic...

Mondi: Insights from recent European peer results

Mondi will report H1 22E results on 4 August: Including Russia, we expect EBITDA of EUR 1.122mn (Q1 22A: EUR 574mn & Q2 22E: EUR 548mn), driving underlying EPS of EUR 1.34/share (+89% y/y & +61% h/h) and DPS of EUr 23/share (+13% y/y). We expect the balance...

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Key message: July 2021 was impacted by a number of factors rendering YoY comparisons meaningless. Local manufacturers do continue to recover market share as factories reopen. NAAMSA released July 2022 new vehicle sales. The numbers are distorted by the KZN unrest,...

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Key message: Increased local demand for containerboard boosted revenue, and margins increased despite cost pressures. Some once-off items impacted results (floods, fruit export delays). Mpact released a Trading Update for 1H FY22. HEPS of 153-164c is expected from...