External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

Equity Bottom-Up

Onewo Inc. operates as a property management service provider. The Company operates and manages residential communities, workspaces, public premises, and others. Onewo provides its services throughout Hong Kong.

<ul><li>Onewo's 1H24 earnings missed market expectation, but the company raised dividend payout ratio from 30% to 100% of core net profit (55% interim div + 45% special div.), representing a div yield of 9.1% based on the closing price on 22 Aug assuming no special dividend payout in the full year.</li><li>1H24 revenue was up 9.6% YoY, gross margin (GPM) contracted by 1.4 ppt to 13.6%, and net profit decreased by 23% YoY. Our key findings are: 1) Residential PM and Bpaas provided crucial support to the company despite challenging industry conditions.</li><li>2) Commercial PM faced challenges in 1H24, with revenue growth accompanied by a decline in gross margin, largely due to price cuts to attract customers and becoming a major source of ARs in a weak economic environment. </li></ul><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

Onewo's 1H24 earnings missed market expectation, but the company raised dividend payout ratio from 30% to 100% of core net profit (55% interim div + 45% special div.), representing a div yield of 9.1% based on the closing price on 22 Aug assuming no special dividend payout in the full year.1H24 revenue was up 9.6% YoY, gross margin (GPM) contracted by 1.4 ppt to 13.6%, and net profit decreased by 23% YoY. Our key findings are: 1) Residential PM and Bpaas provided crucial support to the company despite challenging industry conditions.2) Commercial PM faced challenges in 1H24, with revenue growth accompanied by a decline in gross margin, largely due to price cuts to attract customers and becoming a major source of ARs in a weak economic environment. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Onewo (2602 HK) - 1H24 Missed, Raised Div. Payout Again to 100% of Core Net Profit

HK/China Equity Long-Short

Osbert Tang, CFA

SITC International Holdings Company Ltd. offers marine shipping services.  The Company offers container liner shipping, freight forwarding, customs clearance, shipping agency, and ship brokerage services.  SITC operates in Asia.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/sitc-international-holdings" target="_blank" data-smartkarma-citation="entities:15301:1" rel="noopener">SITC International (1308 HK)</a>'s management guided for a promising outlook for 2H24, with strong load performance in Jul-Aug, and better long-term contract rates YoY.  </li>
<li>Gross margin expanded 4.5pp in 1H24 despite a 5.3% drop in average freight rate, thanks to good cost control with lower chartered-in costs and more self-owned vessels.</li>
<li>Net cash increased 195% from end-FY23, and we are confident that its 70% payout ratio can be maintained. Its P/B is still below the 5-year average.</li>
</ul>



SITC International (1308 HK)'s management guided for a promising outlook for 2H24, with strong load performance in Jul-Aug, and better long-term contract rates YoY.  
Gross margin expanded 4.5pp in 1H24 despite a 5.3% drop in average freight rate, thanks to good cost control with lower chartered-in costs and more self-owned vessels.
Net cash increased 195% from end-FY23, and we are confident that its 70% payout ratio can be maintained. Its P/B is still below the 5-year average.


SITC International (1308 HK): Advancing Amid the Challenging Time

Blue Lotus Non US Internet research, Blue Lotus Research Institute

Ying Pan

Blue Lotus Non US Internet research

China growth and global non-US Internet equities

Blue Lotus Research Institute

Blue Lotus Research is a Hong Kong Type 4 Licensed investment advisory firm focusing on Chinese growth equities and global non-US Internet equities

Vipshop Holdings Ltd. retails branded products at discount over the Internet. The Company retails through flash sales, in which limited quantities of an item are sold at deep discount for a specified period of time.

<ul>
<li>Vipshop reported C2Q24 revenue and profit were in-line vs. the street, but the mid-point of C3Q revenue guide missed by 8% due to soft apparel demand;</li>
<li>VIPS has been post growth for some time. However, its healthy cash flow ensures a 75% dividend payout ratio as promised by the company. </li>
<li>We cut our CY24 EPS estimate by 8.4% due to soft apparel demand, leading to a US$ 14.5 TP, but maintain BUY on a post-subsidy recovery. </li>
</ul>


Vipshop reported C2Q24 revenue and profit were in-line vs. the street, but the mid-point of C3Q revenue guide missed by 8% due to soft apparel demand;
VIPS has been post growth for some time. However, its healthy cash flow ensures a 75% dividend payout ratio as promised by the company. 
We cut our CY24 EPS estimate by 8.4% due to soft apparel demand, leading to a US$ 14.5 TP, but maintain BUY on a post-subsidy recovery. 


[Vipshop (VIPS US, BUY, TP US$14.5) TP Change]: Buying for Dividend Yield and Cash Flow Yield

Global Emerging Market Equities, Propitious Research

Wium Malan, CFA

Global Emerging Market Equities

Independent, Fundamental Quantitative Research

Propitious Research

Fully independent, fundamental and quantitative equity research, focused on companies in the Telecommunication, Media, Technology, Internet and Healthcare sectors in the Global Emerging Markets. Idea generation focused on Quality stocks, trading below their intrinsic Value, with sound Corporate Governance.

Parade Technologies Ltd is a fabless semiconductor company that specialzies in high-speed video interfacing and processing products used in personal computer and consumer electronics applications, such as digital TVs, DVDs, monitors and display panels, and set-top boxes.

<ul>
<li>Following a protracted downturn, <a href="https://www.smartkarma.com/entities/parade-technologies-ltd" target="_blank" data-smartkarma-citation="entities:6987:1" rel="noopener">Parade Technologies (4966 TT)</a> delivered +24%y/y revenue growth driven by both its Display Port (+23%y/y) and its High-Speed Interface Solutions (+30%y/y) segments.</li>
<li>Parade’s gross margin has stabilised at around 43% as strong demand in the High-Speed Interface Solutions segment offset intensified price competition in the Display Panel segment.</li>
<li>Parade finished 2Q24 with NT$10.1bn in net cash on its balance sheet, roughly 16% of its Market Cap.</li>
</ul>


Following a protracted downturn, Parade Technologies (4966 TT) delivered +24%y/y revenue growth driven by both its Display Port (+23%y/y) and its High-Speed Interface Solutions (+30%y/y) segments.
Parade’s gross margin has stabilised at around 43% as strong demand in the High-Speed Interface Solutions segment offset intensified price competition in the Display Panel segment.
Parade finished 2Q24 with NT$10.1bn in net cash on its balance sheet, roughly 16% of its Market Cap.


Parade Tech (4966-TT): Quality Tech, at a Discount

Head of Research, Krungthai XSpring

Waraporn Wiboonkanarak

Head of Research

A full service Thai brokerage

Krungthai XSpring

Krungthai XSpring is a full service broker. The company provides a wide range of investment services such as Securities Brokerage, Derivative Agent Business, Securities Borrowing and Lending, Securities Trading, Underwriting, Financial Advisory, Wealth Advisory, Private Fund Management and International Markets Securities Trading. 

In terms of credibility, Fitch Ratings has assigned Krunghtai XSpring a long-term rating of AA- and a national short-term rating of F1+ with stable outlook.

Tisco Financial Group Pcl is a bank holding company.  The Company's banking subsidiary offers working capital, project, term, automobile and home loans; custodian services; securities brokerage; mutual funds; and private banking; and advises on equity and debt capital markets, privatizations, debt restructuring, project finance, and mergers and acquisitions.

<ul><li>We initiate our coverage on TISCO with a Neutral rating and a 12M FV of Bt98.73, based on the earnings yield and a required return of 8.1%.</li><li>The required return being lower than the dividend yield suggests that the share price may move in the range of Bt90-100/share, as in the past, with the high dividend yield helping to limit the downside risk to the share price.</li><li>Meanwhile, the long-term growth prospects remain weak, unless external supporting factors emerge, such as bond yields or the equity risk premium (ERP).</li></ul>

We initiate our coverage on TISCO with a Neutral rating and a 12M FV of Bt98.73, based on the earnings yield and a required return of 8.1%.The required return being lower than the dividend yield suggests that the share price may move in the range of Bt90-100/share, as in the past, with the high dividend yield helping to limit the downside risk to the share price.Meanwhile, the long-term growth prospects remain weak, unless external supporting factors emerge, such as bond yields or the equity risk premium (ERP).

Tisco Financial Group - Lack of Growth Catalysts but Attractive Dividend