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 Price Update
Global pulp inventories increase further, compounded by pressure from P&B shuts in China: August global pulp shipments +1.2% m/m but down 6.7% y/y (China: -2.9% m/m & -23.2% y/y; North America: +6.2% m/m & -1.5% y/y). The shipment-to-capacity ratio was...
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Key message: The Equipment division is benefitting from organic and acquisitive growth, and a strong recovery in Car Rental should boost results. Barloworld released a Trading Update for the 11 months to 31 August 2021. Global supply chain issues seem to have resolved...
Forestry & Paper: Textiles Fibre Update
Key YTD moves: Cotton +15%; Polyester +20%; HW DWP +38%; China-origin DWP +23%; medium-grade VSF +3%; high-end VSF +4% and Lyocell -8%. VSF prices under further pressure as spinners wait on the sideline: The VSF operating rate dropped to 68% as more units were closed...
Forestry & Paper: Industry Price Update
Slight pressure on China pulp prices: China import pulp prices fell further this week (SW: -0.7% and HW: -0.4%). NOREXECO pulp futures for the CY Q4 21E contract imply an 8-10% decline in Europe vs. a 2% decline in China. European graphic paper margins improving...
Forestry & Paper: Textiles Fibre Update
Key YTD moves: Cotton +14%; Polyester +20%; HW DWP +38%; China-origin DWP +25%; medium-grade VSF +5%; high-end VSF +6% and Lyocell -7%. Led by Sateri, VSF producers tried to entice buyers by slashing prices this week: The VSF operating rate dropped to 75% and...
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Post Results Wrap and Chart Book Key message: The FY21 reporting season was significantly more optimistic than recent years. The post-Covid bounce has been followed by signs of a cyclical recovery in the mining and industrial sector. A feature of the FY21 reporting...
SA Banks – BA900 July’21 Review
Annual growth rates in the SARB’s gross loans and advances category is recovering after negative growth was recorded in March, April and May. In absolute Rand terms this category is at the same level it was in March 2020. On our methodology, industry advances growth...
Forestry & Paper: Textiles Fibre Update
Key YTD moves: Cotton +15%; Polyester +17%; HW DWP +38%; China-origin DWP +28%; medium-grade VSF +10% and high-end VSF +13%. In contrast, Lyocell is down 7%. VSF price down 1% w/w: The VSF operating rate was flat at 78% and inventory days increased slightly this week...
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Key message: A strong FY21 result, but growth into FY22 will face some revenue headwinds (used cars) and increased costs (depreciation and finance charges as inventories recover). This might cancel the expected growth in new car sales. FY23 should see normalised...
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Key message: Market share gains in South Africa and better than expected growth in UK/Ireland were a feature of the result. Acquisitive and organic growth plus further operating margin recovery should boost growth into FY22. Bidvest released FY21 results. HEPS...