Cashbuild starts to rebuild

Good morning Voornaam,

Articles:

Ghost Bites: Cashbuild has finally stopped the bleeding of sales volumes - has it bottomed now? Telkom has released the Swiftnet disposal circular. Anglo American, Merafe, Murray & Roberts, Orion Minerals and South32 released updates. Read Ghost Bites, with thanks to Fedgroup.

Dominique Olivier: Perspectives on the quartz crisis in Switzerland in the 1970s and how industries are disrupted. Read it here>>>

Satrix: Year-to-date performance across asset classes, highlighting themes like AI and gold. Read it here>>>

​Fedgroup: Does incorporating alternatives into your portfolio make sense? Get their views in this entertaining article>>>

Podcasts:

Brand new Ghost Wrap: the news and my views on Sirius Real Estate, Afrimat, Oceana and PSG Financial Services, delivered in five minutes and with thanks to Mazars. Listen to it here>>>

​Magic Markets: Strategic trends and recent performance at Nike and Foot Locker, brought to you by Future Forex. Listen to it here>>>

Investec Structured Products: The Global Accelerator offers 100% capital protection in dollars at maturity after five years, while giving exposure to global equity indices. Japie Lubbe joined me in this podcast>>>

Investec podcast The Current: ​Interested in investment opportunities stemming from South Africa's energy transition? Listen to Iman Rappetti in conversation with Barry Shamley, Zane Bezuidenhout, Boipelo Rabothata and Campbell Perry in Episode 4 of The Current at this link>>>

Events:

Unlock the Stock: Astoria Investments joins the platform on Thursday 25th April at midday. Engage directly with the management team and ask questions. Attendance is free but you must register here>>>

bizval webinar: Are you either founding or funding startups? Join bizval on Wednesday 24th April at midday for a webinar featuring international special guest Stefanie Unger, who has deep knowledge of the global startup environment. Attendance is free but you must register here>>>

Local company news:

Ghost Bites is brought to you by Fedgroup.
Cashbuild has been on the receiving end of almost impossible conditions in South Africa, thanks to load shedding, consumer pressure and that general "ugh" feeling in your stomach when you think about investing further in your neighbourhood. Perhaps driven by the recent drop in load shedding, Cashbuild seems to have stopped the bleeding. It's going to be tough to get revenue growth to where it needs to be, but at least volumes have stopped dropping. For those who enjoy riskier long positions, this might be worth doing further digging.
Telkom released the Swiftnet disposal circular, giving all the details for the sale of Swiftnet for a base price of R6.75 billion excluding balance sheet adjustments. Interestingly, a portion of the shareholder loan will remain outstanding for a while. Usually, loans are sold along with equity. Also, if you're an exotic car dealer, you might want to pay attention to the list of advisors on this deal. They are making a lot of money.
In the mining sector, we had updates from Anglo American, Merafe, Orion Minerals and South32. Orion was the focus on the day. When a company uses "spectacular" in a SENS headline, you know the market is going to pay attention. That can quickly become a blessing and a curse, as many growth stock management teams have learnt the hard way.
Finally, there are also some silver linings at Murray & Roberts in the form of an EPC contract award in Latin America.
Get the details in Ghost Bites at this link>>>

LISTEN: The Global Accelerator
(with Japie Lubbe of Investec)

READ: Satrix April Newsletter | An Absolutely Incredible Time We Live In

LISTEN: Cashing in on clean

LISTEN: Ghost Wrap
(Sirius Real Estate | Afrimat | Oceana | PSG Financial Services)

International business news:

Oddly, the US Federal Trade Commission has sued to block the $8.5 billion acquisition of Capri Holdings by Coach and Kate Spade's parent company, Tapestry. Think of this as the Stellantis of luxury fashion: the brands that are struggling to really compete effectively, all bundled together under one name.
Just because you've heard of Versace, Jimmy Choo and Michael Kors doesn't mean that they are competing effectively against the likes of LVMH. Capri's share price is down 15% over five years, whereas LVMH has been a top performer in the markets.
The funny thing about this is that the FTC is worried about the deal depriving customers of access to affordable handbags. Clearly, affordable means very different things to different people!
Interested in the luxury sector? We've covered LVMH and Ferrari before in Magic Markets, along with plenty of mainstream apparel businesses. The entire library is available for just R99/month. Give your portfolio the love it deserves by subscribing here with no minimum monthly commitment.

READ: Tick tick boom - perspectives on the quartz crisis
(by Dominique Olivier)

Macroeconomic Update

The US dollar is being supported by a general expectation of higher rates for longer. It seems likely that other central banks (like the ECB and BoE) will most likely need to cut before the Fed, giving further strength to the dollar. Of course, this doesn't do the rand any favours either, with the R19.20 level holding firm for now.
Over in Japan, the markets are awaiting some BOJ action. The gap in rates between the US and Japan is expected to remain wide even if Japanese authorities do intervene, so pressure on the yen continues.
The gold price has suffered its worst daily slide since June 2022 and remains under pressure for a second straight day. The price action at the moment is primarily driven by the level of fear in the Middle East regarding conflict there. Hovering just above $2,300, gold has retreated significantly from the recent highs.
Key indicators: USD/ZAR R19.19; US 10-year 4.61%; Gold $2,306; Platinum ZAR R17,517; Brent Crude $87.44
This macroeconomic update is based on TreasuryONE's morning update.