Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Bottom-Up

Yue Yuen Industrial Holdings / Equity Bottom-Up

<ul>
<li>Yue Yuen has a scalable business model with high dividend yield (6.4%). Its sales and net profit are expected to increase by 9.3% YoY and 55% YoY, respectively in 2024.</li>
<li>The company is likely to enjoy higher sales and profits in 2024 due to improved footwear inventory destocking cycle, higher sales and profits at its subsidiary Pou Sheng.</li>
<li>Yue Yuen Industrial is one of the largest footwear and athletic shoe manufacturers in the world. Its major customers include Nike, Adidas, Puma, and Reebok.</li>
</ul>


Yue Yuen has a scalable business model with high dividend yield (6.4%). Its sales and net profit are expected to increase by 9.3% YoY and 55% YoY, respectively in 2024.
The company is likely to enjoy higher sales and profits in 2024 due to improved footwear inventory destocking cycle, higher sales and profits at its subsidiary Pou Sheng.
Yue Yuen Industrial is one of the largest footwear and athletic shoe manufacturers in the world. Its major customers include Nike, Adidas, Puma, and Reebok.


Asian Hedge Fund Manager, Long Short Equity, Macro

David Mudd

<ul>
<li>Vietnam now accounts for more than 50% of production replacing China</li>
<li>China production is less than 25% of overall capacity in 2023</li>
<li>Reshoring and production of higher end "Athleisure" shoes is increasing margins for Stella International (1836 HK) </li>
</ul>


Vietnam now accounts for more than 50% of production replacing China
China production is less than 25% of overall capacity in 2023
Reshoring and production of higher end "Athleisure" shoes is increasing margins for Stella International (1836 HK) 


Stella International: A Beneficiary of Reshoring

Hua Hong Semiconductor / Equity Bottom-Up

<ul>
<li>After hitting a low point in Q4 2023, Research on Hong Kong companies has been slow to pick up reflecting the ongoing skepticism from investors. </li>
<li>Reports on the large China tech companies dominated the top ten companies covered over the last couple of years and in the first half of 2024.</li>
<li>As China continues to dominate and make news in the global EV market, research in that sector has picked up.</li>
</ul>


After hitting a low point in Q4 2023, Research on Hong Kong companies has been slow to pick up reflecting the ongoing skepticism from investors. 
Reports on the large China tech companies dominated the top ten companies covered over the last couple of years and in the first half of 2024.
As China continues to dominate and make news in the global EV market, research in that sector has picked up.


BUY/SELL/HOLD: China/Hong Kong Stock Updates (July 8th)

Douglas Research Advisory

Eagle Nice (Intl) Hldgs / Equity Bottom-Up

<ul>
<li>Eagle Nice International Holdings' dividend yield averaged 9.2% from FY 2019 to FY 2023. Its annual dividend payout averaged 72.2% in the same period.</li>
<li>Eagle Nice (Intl) Hldgs is mainly engaged in the design and manufacture of sportswear for adults and children on an OEM basis. Yue Yuen Industrial Holdings is the largest shareholder.</li>
<li>Eagle Nice Holdings also has attractive valuations and consistent growth in sales and profits. </li>
</ul>


Eagle Nice International Holdings' dividend yield averaged 9.2% from FY 2019 to FY 2023. Its annual dividend payout averaged 72.2% in the same period.
Eagle Nice (Intl) Hldgs is mainly engaged in the design and manufacture of sportswear for adults and children on an OEM basis. Yue Yuen Industrial Holdings is the largest shareholder.
Eagle Nice Holdings also has attractive valuations and consistent growth in sales and profits. 


Asian Dividend Gems: Eagle Nice International Holdings

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Capital Markets

Belle Fashion Group / Equity Capital Markets

<ul>
<li>The core of Belle's transformation is to inject “digitalization” into existing massive store assets, with strategy of “omnichannel+multi brands”. Belle also devotes significant resources to online channels and online-to-offline integration.</li>
<li>Benefiting from the DTC retail model, Belle increases the probability of success when launching products. Licensing/acquisition are important ways to empower new brands and promote growth. Belle’s performance has rebounded.</li>
<li>However, the path of transformation hasn't yet been completed. Belle still mainly relies on heavy asset mode and is exposed to inventory risks. There ‘s still room for further improvement.</li>
</ul>


The core of Belle's transformation is to inject “digitalization” into existing massive store assets, with strategy of “omnichannel+multi brands”. Belle also devotes significant resources to online channels and online-to-offline integration.
Benefiting from the DTC retail model, Belle increases the probability of success when launching products. Licensing/acquisition are important ways to empower new brands and promote growth. Belle’s performance has rebounded.
However, the path of transformation hasn't yet been completed. Belle still mainly relies on heavy asset mode and is exposed to inventory risks. There ‘s still room for further improvement.


Pre-IPO Belle Fashion Group - Performance Has Picked Up, but Not yet Reversed

Hong Kong

Stella International Holdings Limited develops and manufactures footwear products for casual and fashion footwear companies worldwide.

Crystal International Group Limited manufactures apparels. The Company produces casual clothes, jeans, personal under wears, sweaters, sports garments, and other products. Crystal International Group markets its products in Hong Kong.

Theme International Holdings Limited, through its subsidiaries, manufactures, retails, and trades garments. The Company also invests in properties.

Viva Goods Company Limited operates as a sports company. The company provides sports related services such as multi-brand sports apparels and footwear operation, events production and management, and sports-related consultancy and sports community development. Viva Goods conducts business in Hong Kong.

Texhong Textile Group Limited manufactures and sells yarn and grey fabrics. The Company's main focus is promoting and selling spandex stretch yarn and spandex stretch grey fabrics.

Citychamp Watch & Jewellery Group Limited, through its subsidiaries, manufactures and distributes watches, timepieces and enamelled copper wires. The Company also invests in and develops properties.

Pak Tak International Limited, through its subsidiaries, manufactures (through its own producing facilities or sub-contracting to garment manufacturers), on an OEM basis, and export men's, ladies' and children knitted garments to the United States and Europe. The Company also manufactures non-knitted garment for international airlines and retail chain store "Target" in the United States.

Regina Miracle International Holdings Limited is an intimate and sports apparel designer and manufacturer. The Company's biggest customers include Adidas, Reebok, Under Armour, and Champion. Regina Miracle International operates in Southeast Asia.

Eagle Nice (International) Holdings Limited, through its subsidiaries, designs and manufactures sportswear for men, women, and children on an OEM (Original Equipment Manufacturing) basis.  The sportswear supplies by the Company includes sports pants, jackets, tracksuits, sweaters, and T-shirts.

Pacific Textiles Holdings Limited manufactures customized knitted fabrics. The Company's fabrics are used in a broad range of fabrics, including men's, women's, and children's clothing, sportswear, swimwear, and inner-wear.

GOLDWIN INC. manufactures and markets sportswear for skiing, snowboarding, soccer, tennis, swimming, and other outdoor activities.

Zhejiang Weixing Industrial Development Co., Ltd. manufactures buttons, zips, and other apparel accessories. The Company also provides electroplating services.

Bata India Limited manufactures a wide range of leather, rubber/canvas and plastic footwear products.  The Company also manufactures sports apparel and leather accessories.  Bata India sells its products through its chain of company owned retail stores in India, as well as to businesses in the USA, United Kingdom, Europe, the Middle East and the Far East.

Carter's, Inc. markets baby and young children's apparel in the United States. The Company's brands are sold to national department stores, chain and specialty stores, discount retailers, and its own retail stores.

Swan Energy Ltd., through a subsidiary, explores for or procures natural gas and liquefied natural gas for Gujarat.  The Company also develops the gas grid in Gujarat and distributes natural gas.

Relaxo Footwears Ltd. is the marketing company for Relaxo Group.  The Group manufactures Hawai and lightweight chappals.

DESCENTE, LTD. manufactures athletic clothing including golf wear and ski wear. The Company also manufactures tennis shoes, skies, and sports bags.

Welspun India Limited is a home textile manufacturer with a global distribution network.

Vardhman Textiles Limited manufactures textile products. The Company offers wide  range of greige and dyed yarns in cotton, polyester, acrylic, and a variety of blends. Vardhman Textiles serves customers worldwide.

Under Armour, Inc. develops, markets, and distributes branded performance products for men, women, and youth. The Company designs and sells a broad offering of apparel and accessories made of synthetic microfibers.

Yue Yuen Industrial (Holdings) Limited, through its subsidiaries, manufactures and markets athletic, athletic style leisure, and casual and outdoor footwear.

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Yue Yuen Industrial Holdings (551 HK)

Asian Dividend Gems: Yue Yuen Industrial

Yue Yuen is likely to enjoy higher sales and profits in 2024 due to improved footwear inventory destocking cycle, higher sales and profits at its...

Douglas Kim

Stella International: A Beneficiary of Reshoring

Yesterday Stella gave a POSITIVE PROFIT ALERT saying that for the 6 months ending June 30 its profit would grow to $90mm from $55.2mm last year. ...

David Mudd

BUY/SELL/HOLD: China/Hong Kong Stock Updates (July 8th)

Tech NEV companies continue to dominate the research landscape for Hong Kong coverage. Bosideng, China Water Affairs, Topsports, BYD and Xiaomi...

David Mudd

Asian Dividend Gems: Eagle Nice International Holdings

Eagle Nice (Intl) Hldgs is mainly engaged in the design and manufacture of sportswear for adults and children on an OEM basis. Yue Yuen Industrial...

Douglas Kim

Pre-IPO Belle Fashion Group - Performance Has Picked Up, but Not yet Reversed

After years of accumulation/continuous optimization, Belle’s DTC omnichannel retail network has solidified foundation of performance growth. But...

Xinyao (Criss) Wang

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