Sector reports

Below is a list of sector reports.

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Investment Companies

26/09/2016
Listed Private Equity - The opportunities and challenges for investors
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In the first part of a series of reports on listed private equity (LPE), we examine the key opportunities and issues for investors.

Companies mentioned
Show companies...3i Group, Aberdeen Private Equity Fund, Altamir SCA, Candover Investments, Deutsche Beteiligungs, Electra Private Equity, F&C Private Equity Trust, GIMV NV, HarbourVest Global Private Equity, HBM Healthcare Investments, HBM Healthcare Investments, ICG Enterprise Trust, ICG Enterprise Trust, NB Private Equity Partners, Oakley Capital Investments, Pantheon International, Princess Private Equity Holding, Scottish Mortgage Investment Trust, Standard Life European Private Equity Trust, SVG Capital, Woodford Patient Capital Trust

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Oil & Gas

22/09/2016
Exploration watch - Barents Sea - frontier drilling in 2017
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The Barents Sea to the north of Norway is estimated to contain almost half of the recoverable undiscovered resources remaining in the Norwegian Continental Shelf (NCS). At present only two fields, Statoil’s Snøhvit and Eni’s Goliat, are in production but a number of discoveries since 2011 have the potential to be standalone developments and are currently being appraised. The recent 23rd licensing round awarded acreage exclusively in the Barents and for the first time included the frontier South East Barents. Statoil has already indicated that it plans to drill the high-risk/high-reward Korpfjell prospect located in PL859 in this frontier area as part of a five- to seven-well Barents exploration programme in 2017.

Companies mentioned

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Financials

12/09/2016
Tel Aviv Stock Exchange - Start-up market?
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Israel’s technology and healthcare industries together make up one of the strongest hubs of value creation globally. Until now this value creation has largely bypassed the Tel Aviv Stock Exchange (TASE), with trade sales or overseas exchanges preferred to a domestic listing. Far-reaching reforms are now being put in place to change this. Success will make it much easier for domestic and international equity investors to support and benefit from this hub of value creation.

Companies mentioned

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Oil & Gas

02/09/2016
Value the company, not the asset
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In preparation for a new oil cycle, we believe investors should re-examine the critical components of the valuation of oil companies to ensure lessons are learnt from the last cycle. We think investors should look at fundamental company valuations (rather than asset values in isolation) to price investment opportunities. By this, we mean take into account all the risks and costs that companies run into when progressing assets that may negatively affect the asset value. We primarily look at examining the costs to equity investors of holding E&P stocks in the last cycle and the associated equity and asset dilutions required to fund operations; we conclude that this effect may be larger than many currently assume.

Companies mentioned

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Mining

11/08/2016
Niobium - The envy of the gods
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The growing recognition of niobium as a vital new-age metal with limited supply was reflected in Anglo American’s recent sale of Catalão. The auction process was keenly competitive and resulted in Anglo selling Catalão for US$1.5bn, c 50% more than previous market forecasts. Two years earlier, in 2014, Magris Resources (owned 50% each by Cheung Kong and the Canadian Imperial Bank of Commerce) and Temasek acquired Niobec from IAMGOLD for c US$500m and, in 2011, Posco and Nippon jointly invested c US$2.0bn for a 15% interest in CBMM, followed by a Chinese consortium comprising CITIC, Baosteel and Shougang on similar terms, shortly afterwards.

Companies mentioned
Show companies...Companhia Brasileira de Metalurgia e Mineração (CBMM), Mineração Catalão, China Molybdenum, Magris Resources, Anglo American, IAMGOLD, Cradle Resources, Alkane Resources

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Travel & Leisure

21/07/2016
Consumer: Pubcos: MRO update
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Legislation effective today makes it possible for pub tenants to set aside the traditional drinks tie with pub companies, and instead buy their drinks from cheaper sources. The issue has been in prospect since late 2014 and has been folded into companies’ strategies where relevant, with estate management actions well advanced and active engagement with tenants. These will change the sector in ways that the sponsors of the legislation did not intend. We anticipate less immediate disruption than headlines would suggest, although the inevitable uncertainty comes at exactly the wrong time given the post-Brexit hit to consumer confidence.

Companies mentioned

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Oil & Gas

19/07/2016
Exploration watch - Porcupine Basin: Phase 2 - Independents Day
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Interest in the underexplored Porcupine Basin offshore Ireland remains strong, with a record number of applications received in the recent 2015 Atlantic Margin Irish licensing round. The Phase 1 awards were announced in February 2015 and saw a number of major companies picking up significant positions in the basin, including ExxonMobil and Statoil, both companies with large interests in the analogous Flemish Pass Basin. This update looks at the most recent awards made in June 2016 under Phase 2 of the 2015 round, where 11 licence options were awarded entirely to independent companies including Cairn Energy, Europa Oil & Gas, Petrel Resources and Providence Resources. Meanwhile, a number of substantial 3D seismic surveys are due to be completed over the summer, driven by the majors, which could lead to exploration drilling in 2018/19.

Companies mentioned

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Oil & Gas

27/04/2016
Exploration watch - Porcupine Basin - focus of major interest
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The underexplored Porcupine Basin offshore Ireland attracted 80% of the applications in the recent 2015 Atlantic Margin Irish licensing round, and for the first time saw a significant number of awards going to major companies including ExxonMobil, Statoil, Nexen and BP. The area has become a focus of attention most recently as a result of Statoil’s 300-600mmbbl Bay du Nord discovery in the analogous Flemish Pass Basin offshore Canada, but is also the result of earlier work by a number of independent companies that kicked off a round of data acquisition and saw a marked increase in 3D seismic surveys in 2013. As a result, companies such as Antrim Energy, Europa Oil & Gas, Petrel Resources and Providence Resources hold assets surrounded by major-held licences and are well-positioned to benefit in the ongoing farm-out processes.

Companies mentioned