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
Making It PossibleForestry & Paper: Suzano 2022 Day (Pulp Insights)
Suzano hosted its 2022 Day this week: Key focus areas included sustainability, expanding into new markets; advances in the links of the chain (focussed on textiles; micro fibrillated cellulose, biofuels, and carbon) with a competitive advantage; maintaining relevance...
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New Vehicle Sales – March 2022 Key message: March 2022 passenger car sales grew by 27.0% YoY. LCV sales declined by 2.8%. NAAMSA released March 2022 new vehicle sales.Car sales have now matched pre-Covid levels, with passenger and LCV sales increasing 14.3% YoY and...
Forestry & Paper: Industry Insights
Pulp prices in China up 4-6% w/w: NOREXECO pulp futures for CY 23E imply a 9-14% decline in Europe, and China. Availability of NBSK in contract and spot markets in the US has slumped due to unplanned downtime, while shipment delays worsened in recent weeks. In...
Forestry & Paper: Textile Fibre Insights
Key w/w moves: Cotton +7%; Polyester +2%; HW DWP +1%; China-origin DWP 0%, medium-grade VSF 0%; and high-end VSF +1% and Lyocell +1%. Cotton’s premium to VSF is 65% (2021 average: 30%) and a 179% premium to polyester (2021 average: 150%). The VSF premium to polyester...
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Key message: A strong trading period but Russia will cloud the short-term outlook. We value the Russian business is worth R30/share at normalised levels. While sanctions and supply chain issues will impact the region, we expect the aftermarket business to remain...
PPC – Operational Update
Key message: Overall cement volumes and pricing are up, led by the international cement operations. Zimbabwean cash extraction is improving, and a dividend is likely in FY23. PPC released an operational update for FY22 and hosted a Capital Markets Day and Site Visit...
Forestry & Paper: Industry Insights
Pulp prices firmly in the green: NOREXECO pulp futures imply flat pulp prices for the rest of 2022 in Europe, while prices in China are expected to increase by 5-7%. For 23E, the futures imply an 9-14% decline in Europe, while prices in China are expected to decline...
Forestry & Paper: Textile Fibre Insights
Key w/w moves: Cotton +5%; Polyester -4%; HW DWP stable China-origin DWP +1%, medium-grade VSF +1% w/w; and high-end VSF and Lyocell stable. Cotton’s premium to VSF is 63% (2021 average: 30%) and a 180% premium to polyester (2021 average: 150%). The VSF premium to...
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Key message: Key sectors showing demand growth, with some lag in passing through price increases. Growth into FY23 expected through international business (organic) and South Africa (low base). We spoke to management to get a pre-close update for FY22. In line with...
AfroCentric: H1 22A Insights
H1 22A results snapshot: Revenue +10% y/y (+3% h/h); EBITDA +5% y/y (-12% h/h), which meant the EBITDA margin moderated by 64bps y/y to 12.5%. Normalized HEPS (N.HEPS) and DPS were stable y/y at ZAr 26.51 and ZAr 17 (4% dividend yield), respectively. Shares in issue...