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.

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Forestry & Paper: Sappi Q2 22A Insights

Q2 was much better than expected: Q2 22A marked the 7th consecutive quarter of improving EBITDA to USD 337mn (24% ahead of CRe) and EPS of USD 0.35/share (44% ahead of CRe). Consequently, net debt was also better than expected, declining by 6% (USD 124mn) q/q to USD...

Forestry & Paper: Sappi Q2 22E Insights

Q2 22E results on Thursday 12 May, key numbers to look out for: Q2 to mark the seventh quarter of sequential EBITDA improvement to USD 273mn (+144% y/y and +14% q/q) and EPS of USD 0.24/share. Q1 22A recap (EBITDA: USD 240mn and EPS: USD 0.20/share and net debt/EBITDA...

Forestry & Paper: Textile Fibre Insights

The imported hardwood DWP averaged USD 1,051/t in April: This meant the price increased by 8.4% m/m; however, was down 4.6% y/y.Key w/w moves: Cotton -2%; Polyester +5%; HW DWP +3%; China-origin DWP +3%, medium-grade VSF +1%; and high-end VSF 0% and Lyocell +0%....

Calgro M3 – FY22 Trading Statement

Key message: Earnings growth of approx. 50% in 2H shows the ongoing recovery of the operating businesses, coupled with a strengthening of the balance sheet. Calgro released a Trading Statement for FY22.HEPS is expected to be between 105c and 106.4c – compared to the...

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FY22 Results Overview Key message: Car dealerships and rental are enjoying higher than normal margins –management believe they can hold onto some of the margin uplift. CMH announced FY22 results, with a strong performance – HEPS up 117% to 501c (all time high) off a...

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New Vehicle Sales – April 2022 Key message: Local brands suffer due to flooding impacts but imported brands see good growth. NAAMSA released April 2022 new vehicle sales. The period was characterised by a strong performance from the imported brands but local...

SA Banks

BA900 – February 2022. Nedbank the most consistent performer, for the wrong reasons though. Annual growth rates in the SARB’s gross loans and advances category improved from 4% in Jan 22 to 4.2% in Feb 22. It’s been around these levels for the past quarter. On our...

Afrimat – FY22 Trading Statement

Key message: The medium-term investment case remains linked to the internally funded volume growth in iron ore, manganese and industrial minerals. Afrimat released a Trading Statement for FY22. HEPS is expected to be between 526-570c (+19-29%).This implies relatively...

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Post Results Wrap and Chart Book Survivorship bias drives market share growth: a theme that is likely to become entrenched, in our opinion, is a clear survivorship bias. Doing business in South Africa is difficult and expensive, and large diversified companies are...

Forestry & Paper: Industry Insights

The imported hardwood DWP averaged USD 969/t in March (+0.7% m/m and -1.4% y/y): The average DWP price for January-March 2022 was USD 929/t (-0.5% y/y and -0.5% q/q).Key w/w moves: Cotton -1%; Polyester -1%; HW DWP +2%; China-origin DWP +5%, medium-grade VSF +1%; and...