Silver Point

Thomas J. Monaco

Independent Insight Provider

Silver Point is a boutique research firm that focuses on the broader financial services sector, with a particular focus on troubled institutions globally. 

Asia Ex Japan

Equity Bottom-Up

*Simon Says: In Afterpay’s Touch’s (APT.AU) [Afterpay] latest move, it was announced that it will collaborate with Simon Property Group (SPG.US) in the US across it’s significant footprint of retail shopping malls  - over 200 across the country. This collaboration enables Afterpay to establish an in-store presence in the US where both companies will work side by side with retailers in Simon shopping malls;*Tencent Tutelage: Afterpay is helping Tencent enter markets earlier and with Tencent’s (700.HK) tutelage likely will help Afterpay more deeply penetrate North America.  We fully anticipate that Tencent will help Afterpay enter the Asian markets - uncharted territory with a large young population – with the big prize obviously being mainland China. Tencent’s digital expertise should also help Afterpay to improve its technology platform (e.g. its digital wallet checkout experience and its shopping platform, plus customer led generation). It also wouldn’t surprise us if Tencent took up greater than its pro rata share of the capital raise; and*Magic Fairy Dust: While no transaction particulars were disclosed, we calculate an average share purchase price of AUD 22.47 per share for the 5% stake or a hefty 6.8x P/BV for a company which is loss-making and where Tencent hasn’t control. Tencent has already earned 278% on this stake.

*Simon Says: In Afterpay’s Touch’s (APT.AU) [Afterpay] latest move, it was announced that it will collaborate with Simon Property Group (SPG.US) in the US across it’s significant footprint of retail shopping malls  - over 200 across the country. This collaboration enables Afterpay to establish an in-store presence in the US where both companies will work side by side with retailers in Simon shopping malls;*Tencent Tutelage: Afterpay is helping Tencent enter markets earlier and with Tencent’s (700.HK) tutelage likely will help Afterpay more deeply penetrate North America.  We fully anticipate that Tencent will help Afterpay enter the Asian markets - uncharted territory with a large young population – with the big prize obviously being mainland China. Tencent’s digital expertise should also help Afterpay to improve its technology platform (e.g. its digital wallet checkout experience and its shopping platform, plus customer led generation). It also wouldn’t surprise us if Tencent took up greater than its pro rata share of the capital raise; and*Magic Fairy Dust: While no transaction particulars were disclosed, we calculate an average share purchase price of AUD 22.47 per share for the 5% stake or a hefty 6.8x P/BV for a company which is loss-making and where Tencent hasn’t control. Tencent has already earned 278% on this stake. 

HK/China Equity Long-Short

Osbert Tang, CFA

Thematic (Sector/Industry)

With more than half of the double festival holidays of China have now passed, we took an on-the-ground check for the business in the Golden Week. A walk along the Nanjing Road Pedestrian Walk in Shanghai with visits to various retail stores showed that consumption has witnessed a good, but not yet full, recovery.
We stopped by mobile phone, sportswear, jewellery and high-end luxury stores, and saw that mobile phone stores are witnessing the best customer patronage. Based on our visits, we observed that: 1.) Apple store (<a href="https://www.smartkarma.com/entities/apple-inc" target="_blank" data-smartkarma-citation="entities:666:1" rel="noopener">Apple Inc (AAPL US)</a>) is doing better than Huawei, 2.) Nike and Adidas (<a href="https://www.smartkarma.com/entities/topsports-international" target="_blank" data-smartkarma-citation="entities:28153:1" rel="noopener">Topsports International (6110 HK)</a>) &gt; FILA (<a href="https://www.smartkarma.com/entities/anta-sports-products-ltd" target="_blank" data-smartkarma-citation="entities:10261:1" rel="noopener">Anta Sports Products (2020 HK)</a>) and <a href="https://www.smartkarma.com/entities/li-ning-co-ltd" target="_blank" data-smartkarma-citation="entities:6047:1" rel="noopener">Li Ning Co Ltd (2331 HK)</a>, 3.) <a href="https://www.smartkarma.com/entities/chow-tai-fook-jewellery-group" target="_blank" data-smartkarma-citation="entities:549:1" rel="noopener">Chow Tai Fook Jewellery (1929 HK)</a> &gt; Lao Miao (<a href="https://www.smartkarma.com/entities/fosun-international-ltd" target="_blank" data-smartkarma-citation="entities:433:1" rel="noopener">Fosun International (656 HK)</a>) and 4.) high-end luxury goods are in good demand, and this is positive to <a href="https://www.smartkarma.com/entities/hang-lung-properties-ltd" target="_blank" data-smartkarma-citation="entities:49:1" rel="noopener">Hang Lung Properties (101 HK)</a> and <a href="https://www.smartkarma.com/entities/china-tourism-group-duty-free-corp-ltd" target="_blank" data-smartkarma-citation="entities:12278:1" rel="noopener">China Tourism Group Duty Free Corp Ltd (601888 CH)</a>. Read on for pictures and more details.

With more than half of the double festival holidays of China have now passed, we took an on-the-ground check for the business in the Golden Week. A walk along the Nanjing Road Pedestrian Walk in Shanghai with visits to various retail stores showed that consumption has witnessed a good, but not yet full, recovery.
We stopped by mobile phone, sportswear, jewellery and high-end luxury stores, and saw that mobile phone stores are witnessing the best customer patronage. Based on our visits, we observed that: 1.) Apple store (Apple Inc (AAPL US)) is doing better than Huawei, 2.) Nike and Adidas (Topsports International (6110 HK)) &gt; FILA (Anta Sports Products (2020 HK)) and Li Ning Co Ltd (2331 HK), 3.) Chow Tai Fook Jewellery (1929 HK) &gt; Lao Miao (Fosun International (656 HK)) and 4.) high-end luxury goods are in good demand, and this is positive to Hang Lung Properties (101 HK) and China Tourism Group Duty Free Corp Ltd (601888 CH). Read on for pictures and more details.

China on the Ground: Hey, How's Your Golden Week?

Consumer Analyst / Channel Surveillance Specialist, Trudence Capital Advisors

Pranav Bhavsar

Consumer Analyst / Channel Surveillance Specialist

ASA Capital Management

ASA Capital Management is a boutique Research and Investment Advisory firm focusing on primary research in India. ASA provides bespoke research services to Institutional Clients with a focus on due diligence backed with primary research, Field Trips & Channel Checks.

Our objective with this weekly is to highlight notable developments in the India internet and consumer sector focusing on public and private companies. The sub-sectors covered include payment providers, e-commerce retailers,  social media platforms and consumer companies.
<ul>
<li>
<a href="https://www.smartkarma.com/entities/alphabet-inc-cl-c" target="_blank" data-smartkarma-citation="entities:11369:1" rel="noopener">Alphabet Inc Cl C (GOOG US)</a> monopoly is challenged. Indian entrepreneurs and application developers are hell bent on developing India's local Appstore which will directly compete with the Google PlayStore and <a href="https://www.smartkarma.com/entities/apple-inc" target="_blank" data-smartkarma-citation="entities:666:1" rel="noopener">Apple Inc (AAPL US)</a> 's AppStore. </li>
<li>
<a href="https://www.smartkarma.com/entities/walmart-inc" target="_blank" data-smartkarma-citation="entities:11134:1" rel="noopener">Walmart (WMT US)</a> eyes its biggest every India investment of USD 25 billion in Tata Group in order to compete in India's ongoing SuperApp race. </li>
<li>
<a href="https://www.smartkarma.com/entities/reliance-industries-ltd" target="_blank" data-smartkarma-citation="entities:198:1" rel="noopener">Reliance Industries (RIL IN)</a> 's JioMart feels out its subscription commerce model in India.</li>
<li>Smartphones to now cost more in India as the government hikes the import duty on displays.</li>
</ul>

Our objective with this weekly is to highlight notable developments in the India internet and consumer sector focusing on public and private companies. The sub-sectors covered include payment providers, e-commerce retailers,  social media platforms and consumer companies.


Alphabet Inc Cl C (GOOG US) monopoly is challenged. Indian entrepreneurs and application developers are hell bent on developing India's local Appstore which will directly compete with the Google PlayStore and Apple Inc (AAPL US) 's AppStore. 

Walmart (WMT US) eyes its biggest every India investment of USD 25 billion in Tata Group in order to compete in India's ongoing SuperApp race. 

Reliance Industries (RIL IN) 's JioMart feels out its subscription commerce model in India.
Smartphones to now cost more in India as the government hikes the import duty on displays.


India Internet & Consumer Weekly | Indian App Store, Walmart, JioMart

Asian Insight Provider - Actionable ideas, CrossASEAN Research

Henry Soediarko

Asian Insight Provider - Actionable ideas

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

The existence of the annual cap from BYD Electronics to the BYD group which then sells the masks to the distributors or end customers through BYD Care (a subsidiary of BYD Group), BYD Electronics will see an increase in revenues but not so much of the increase in the margin as BYD Care (the seller of surgical masks) is a subsidiary of <a href="https://www.smartkarma.com/entities/byd-co-ltd-h" target="_blank" data-smartkarma-citation="entities:20962:1" rel="noopener">BYD (1211 HK)</a> rather than BYD Electronics. Among Trump's outperforming Biden in the first Presidential debate, an attempt to make up for the loss, overly bullish investors in China's plan on domestic consumption and surgical masks production, <a href="https://www.smartkarma.com/entities/byd-electronic-international-co-ltd" target="_blank" data-smartkarma-citation="entities:1927:1" rel="noopener">BYD Electronics (285 HK)</a> share price rose close to 10% today makes an attractive entry point to shorting the stock. Size up your bet!

The existence of the annual cap from BYD Electronics to the BYD group which then sells the masks to the distributors or end customers through BYD Care (a subsidiary of BYD Group), BYD Electronics will see an increase in revenues but not so much of the increase in the margin as BYD Care (the seller of surgical masks) is a subsidiary of BYD (1211 HK) rather than BYD Electronics. Among Trump's outperforming Biden in the first Presidential debate, an attempt to make up for the loss, overly bullish investors in China's plan on domestic consumption and surgical masks production, BYD Electronics (285 HK) share price rose close to 10% today makes an attractive entry point to shorting the stock. Size up your bet!

BYD Electronics (285): Where Is the Margin At?

Semiconductor & Technology Specialist, Ingenuity

William Keating

Semiconductor & Technology Specialist

Ingenuity

Our focus is exclusively on in-depth research & consulting in the broader semiconductor industry. We focus on the key players, namely Intel, Micron, Qualcomm, Apple, Samsung, NVIDIA, AMD, TSMC & Global Foundries - as well as some of the lesser known, but nonetheless critical, companies such as ASML (for EUV), Mellanox, Cavium, Xilinx etc. We specialise in their products, roadmaps, process technologies, competitive advantages & threats etc. We also help our clients understand the implications of new and emerging technologies, e.g. 3D X-Point, 3D NAND, Carbon Nanotubes, Autonomous Driving, Graphene, Silicon Photonics, Wafer-Level Optics, Artificial Intelligence, FPGA, GPU, ASIC etc. 

Semiconductor Analysis & Research

On September 22 last,  <a href="https://www.smartkarma.com/entities/western-digital-corp" target="_blank" data-smartkarma-citation="entities:1094:1" rel="noopener">Western Digital'</a> (WDC) issued a press release regarding their plan to create separate organizations for their HDD and SSD businesses. WDC's share price surged by more than 10% in the aftermath of the announcement, fueled by speculation that the company may take things one step further by creating two separate business entities entirely. We think this is not likely to happen. Here's why.

On September 22 last,  Western Digital' (WDC) issued a press release regarding their plan to create separate organizations for their HDD and SSD businesses. WDC's share price surged by more than 10% in the aftermath of the announcement, fueled by speculation that the company may take things one step further by creating two separate business entities entirely. We think this is not likely to happen. Here's why. 

Western Digital. Spinning Out Either HDD Or SSD Divisions Makes No Sense.

United States

Apple Inc. designs, manufactures, and markets smartphones, personal computers, tablets, wearables and accessories, and sells a variety of related accessories. The Company also offers payment, digital content, cloud and advertising services. Apple Inc.'s customers are primarily in consumer, small & mid-sized business, education, enterprise and government markets worldwide.

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Apple (AAPL US)

Tencent - One If By Land

*Simon Says: In Afterpay’s Touch’s (APT.AU) [Afterpay] latest move, it was announced that it will collaborate with Simon Property Group (SPG.US) in...

Thomas J. Monaco

China on the Ground: Hey, How's Your Golden Week?

With more than

Osbert Tang, CFA

India Internet & Consumer Weekly | Indian App Store, Walmart, JioMart

Our objective with this weekly is to highlight notable developments in the India internet and consumer sector focusing on public and private...

Pranav Bhavsar

BYD Electronics (285): Where Is the Margin At?

The share price increase of close to 10% today makes a more attractive entry point to shorting BYD Electronics.

Henry Soediarko

Western Digital. Spinning Out Either HDD Or SSD Divisions Makes No Sense.

On September 22 last, Western Digital' issued a press release regarding their plan to

William Keating

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