GEMS FIRST TO MARKET

Research evidence excerpt

GEMS FIRST TO MARKET

(EBM) 2Q OP missed JPMe/BBGe, led by weaker EV cathode revenue from the US/Europe and a sharp ESS-

bound revenue decline, as SDI appears to be dual-sourcing ESS cathodes with Posco Future M (PFM). With US volumes likely

to be subdued and Europe EV visibility still limited, we see EBM’s addressable end market contracting while competition

intensifies: PFM appears to be taking share in ESS and is also guiding entry into cylindrical cathodes, potentially diluting EBM’s

volume/profit outlook. We see downside risk to the company’s Hungary expansion, given the cost competitiveness of Korea-

made cathodes and potential regulatory relaxation. Reflecting tighter risk appetite, we de-rate to a 25x down-cycle EV/EBITDA

(from 40x) and cut our Dec-27 PT to W62,000; downgrade to Underweight.

Brazil Healthcare (Joseph Giordano), Brazil

2Q26E Preview — Selective Into Prints, Prefer Bradsaúde and Hypera

We see a selective and catalyst driven 2Q26E setup for Brazil Healthcare, with Bradsaúde and Hypera as our preferred

trades into prints, while we avoid Rede D’Or and Blau . The quarter should be somewhat noisy, as the World Cup and

calendar effects likely pressured occupancy, which is negative for hospital operators but should help insurers through better

MLR. Still, thinking longer-term, the broader industry backdrop remains supportive for scaled platforms, with headline industry

ROE near historical highs and no clear evidence of broad-based over-earning given profit concentration among larger

operators and a much lower median ROE. With that, Bradsaúde offers the cleanest positive skew, with earnings close to R$1bn

likely to be well received despite high consensus dispersion. Besides, Hypera should continue to benefit from channel