I have recently looked into a few industrial turnarounds.

I looked at EAF - Graftech, which makes graphite electrodes for electric arc furnaces. The industry is very cyclical and has been in a down cycle for many years. But the downstream companies, like Steel Dynamics STLD and Nucor NUE, have been doing a bit better and steel demand has been fairly strong. However capacity in China continues to ramp up and up and up, even as no one makes any profit. After doing some analysis I have a pretty strong conviction the company will actually go bankrupt rather than turn around.

Then I looked at Tredegar - TG. They are a super old company based in Richmond Virginia with a great Aluminum division called Bonnell Aluminum. They trade at a pretty cheap multiple. After the aluminum tariffs I thought this thing would be protected from Chinese competition. But nope, the Chinese exporters have gotten smart. They will set up a U.S. subsidiary, import at a very low price, pay the tariffs at the low price, then the U.S. subsidiary recognizes all the profits as the price increases to the standard U.S. price.

Then I looked into wafers for semiconductors. All that demand from TSMC and Nvidia and Micron and SK Hynix and and Samsung should mean prices for wafers, particularly those 300 nm wafers, should increase. Sumco (3436.T) and Shin Etsu (4063) in Japan used to have greater than 50% market share of silicon wafers. But now Eswin (688783.SS) in China is making quality 300 nm wafers and taking share. This put pressure on the stock for a long time. Even if we are getting a turnaround, it seems like Eswin will win more than Sumco or Shin-Etsu. Yet foreigners can’t invest in onshore Chinese companies like Eswin.

I looked into robotics and I think one of the best places to invest in robotics is the actuator business. The U.S. based Moog (MOG.A) has been doing well but one of the best in the business is Harmonic drive systems (6324). However they have been dealing with the rise of Chinese actuator companies like Leader Harmonious Drive Systems (688017.SS). Leaderdrive has been on fire up 80% YTD. Again not something that foreigners can invest in.

It just seems like everywhere I look in industrial turnarounds, I see a Chinese company that is doing things better, faster, and at bigger scale, for a lower margin (or a negative margin). It reminds me of the what they used to say about Amazon “your margin is my opportunity).

The frustrating thing is many of the Chinese industrial companies that are leading the charge are listed onshore in Shanghai and Shenzhen and are not available for foreign investors.

It has made me think lately “if you can’t beat ‘em, join ‘em”. Maybe looking for Chinese industrial winners that are dual listed onshore and offshore that westerners can invest in.

Accordingly I have been looking at Midea Group (300.HK) which I think will probably be the winner in air conditioners. I bought a Midea AC and the dang thing is cheap as heck and works great, and they …

为什么值得关注

原内容本身有足够细节，不是表面信息；符合当前抓取需求；原内容本身有足够细节，不是标题党或空洞总结

来源：reddit，领域：news，保留分：0.55