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.
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Making It PossibleForestry & Paper: Industry Insights
Pulp prices rise further in all regions: NOREXECO pulp futures for CY 23E imply a 15-21% decline in Europe, and a decline of 12-19% in China. SCA is set to increase prices for NBSK by c.3% to USD 1,485/t.Graphic Paper prices gain further ground: After factoring in a...
Forestry & Paper: Textile Fibre Insights
Key w/w moves: Cotton +4%; Polyester +10%; HW DWP +0%; China-origin DWP +2%, medium-grade VSF +2%; and high-end VSF +1% and Lyocell +1%. Cotton’s premium to VSF is 33% (2021 average: 30%) and a 119% premium to polyester (2021 average: 150%). The VSF premium to...
Forestry & Paper: Industry Insights
May 2022 average price changes (Europe unless otherwise stated): NBSK pulp +2% m/m; +15% y/y; +10% vs. 2021 average. BHKP pulp +4% m/m; +23% y/y; +17% vs. 2021 average. China BHKP net pulp +4% m/m; +4% y/y; +7% vs. 2021 average. China NBSK net pulp +7% m/m; +0% y/y;...
Spear REIT – FY22 results and valuation update
FY22 results and valuation update Key message: an impressive set of results and solid guidance provides continued justification for Spear’s Western Cape-focused investment case. The LTV reduction roadmap has been achieved and the focus will soon return to finding...
Forestry & Paper: Textile Fibre Insights
The imported hardwood DWP averaged USD 1,114/t in May (+6% m/m and +1% y/y): The average DWP price for April-May 2022 was USD 1,083/t (-2% y/y and +17% q/q).Key w/w moves: Cotton -1%; Polyester 0%; HW DWP +0%; China-origin DWP +4%, medium-grade VSF +1%; and high-end...
Redefine Properties – 1H FY22 results and valuation update
1H FY22 results and valuation update Key message: Redefine’s strategic repositioning of its asset platform is now largely complete. While there is still work to be done on reducing LTV and see-through gearing and addressing EPP’s near-term debt maturities, we think...
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New Vehicle Sales – May 2022 Key message: Local brands continue to suffer due to flooding impacts but imported brands see good growth. NAAMSA released May 2022 new vehicle sales. The disruptions caused by the KZN floods continues to impact the performance of local...
Forestry & Paper: Industry Insights
Pulp prices steady but further prices increases on the cards: NOREXECO pulp futures for CY 23E imply a13-20% decline in Europe, and a decline of 13-17% in China. In China, hardwood prices are set to increase further by c.USD 30/t (effective June) following price...
Forestry & Paper: Textile Fibre Insights
Key w/w moves: Cotton -4%; Polyester 0%; HW DWP +1%; China-origin DWP +0%, medium-grade VSF +1%; and high-end VSF +1% and Lyocell +0%. Cotton’s premium to VSF is 37% (2021 average: 30%) and a 144% premium to polyester (2021 average: 150%). The VSF premium to polyester...
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Key message: Well positioned to benefit from increased private sector participation in the freight movement sector, the recent sale of Grindrod Bank makes Grindrod a focused infrastructure company. We initiate on Grindrod with a Target Price of R14.50.Grindrod has a...