ASEAN Insight Provider, CrossASEAN Research

Angus Mackintosh

ASEAN Insight Provider

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

Cross Asset Strategy

<ul>
<li>The Week That Was in ASEAN@Smartkarma is filled with an eclectic mix of differentiated, substantive, and actionable insights, macro and equity bottom-up, from across South East Asia.</li>
<li>The past week saw insights on <a href="https://www.smartkarma.com/entities/sea-ltd" target="_blank" data-smartkarma-citation="entities:8509:1" rel="noopener">Sea Ltd (SE US)</a> post the FreeFire ban in India plus high-quality tile producer <a href="https://www.smartkarma.com/entities/arwana-citramulia-tbk-pt" target="_blank" data-smartkarma-citation="entities:17042:1" rel="noopener">Arwana (ARNA IJ)</a> and Industrial player <a href="https://www.smartkarma.com/entities/akr-corporindo-tbk-pt" target="_blank" data-smartkarma-citation="entities:13338:1" rel="noopener">AKR Corporindo (AKRA IJ)</a>
</li>
<li>We also look at regional logistics player J&amp;T plus <a href="https://www.smartkarma.com/entities/adi-sarana-armada-tbk-pt" target="_blank" data-smartkarma-citation="entities:16947:1" rel="noopener">Adi Sarana Armada (ASSA IJ)</a> as it ramps up Anteraja as well as palm oil plays and why they have lagged.</li>
</ul>


The Week That Was in ASEAN@Smartkarma is filled with an eclectic mix of differentiated, substantive, and actionable insights, macro and equity bottom-up, from across South East Asia.
The past week saw insights on Sea Ltd (SE US) post the FreeFire ban in India plus high-quality tile producer Arwana (ARNA IJ) and Industrial player AKR Corporindo (AKRA IJ)

We also look at regional logistics player J&amp;T plus Adi Sarana Armada (ASSA IJ) as it ramps up Anteraja as well as palm oil plays and why they have lagged.


The Week That Was in ASEAN@Smartkarma - Sea Ltd & FreeFire, Arwana Citramulia, and CPO's Poor Show

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/siam-makro-public-co-ltd" target="_blank" data-smartkarma-citation="entities:5577:1" rel="noopener">Siam Makro Public (MAKRO TB)</a> is looking to raise up to US$1.8bn in its upcoming Public Offering.</li>
<li>The deal size has been reduced from the initial US$3.9bn down to US$1.8bn, including over-allotment. </li>
<li>Placement price is fixed and discount is tight. There will also be no index fast entry/early inclusion to support the deal in the near-term. </li>
</ul>



Siam Makro Public (MAKRO TB) is looking to raise up to US$1.8bn in its upcoming Public Offering.
The deal size has been reduced from the initial US$3.9bn down to US$1.8bn, including over-allotment. 
Placement price is fixed and discount is tight. There will also be no index fast entry/early inclusion to support the deal in the near-term. 


Siam Makro Placement - Smaller Deal Size with a Tight Discount and No Fast Entry

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/berli-jucker-public-co-ltd" target="_blank" data-smartkarma-citation="entities:3685:1" rel="noopener">Berli Jucker (BJC TB)</a> was hit by COVID lockdowns in 3Q2021 but the recovery has already started for its retail and packaging businesses, especially in Vietnam for the latter.</li>
<li>The company's expansion plans for Mini Big C continue apace, as well conversions to Food Place and its store renovation program, which points toward a strong growth recovery in 2022.</li>
<li>The competitive intensity in Thai retail is reducing, with CP Group's acquisition of Tesco Thailand reducing major players to two, whilst there is a further restructuring under <a href="https://www.smartkarma.com/entities/siam-makro-public-co-ltd" target="_blank" data-smartkarma-citation="entities:5577:1" rel="noopener">Siam Makro Public.</a>
</li>
</ul>



Berli Jucker (BJC TB) was hit by COVID lockdowns in 3Q2021 but the recovery has already started for its retail and packaging businesses, especially in Vietnam for the latter.
The company's expansion plans for Mini Big C continue apace, as well conversions to Food Place and its store renovation program, which points toward a strong growth recovery in 2022.
The competitive intensity in Thai retail is reducing, with CP Group's acquisition of Tesco Thailand reducing major players to two, whilst there is a further restructuring under Siam Makro Public.



Berli Jucker (BJC TB) - Canned Recovery in Motion

<div class="content-highlight">
A call with <a href="https://www.smartkarma.com/entities/berli-jucker-public-co-ltd" target="_blank" data-smartkarma-citation="entities:3685:1" rel="noopener">Berli Jucker (BJC TB)</a> management revealed ongoing pressure from the latest wave of COVID-19 in Thailand, which continues to impact the retail business under Big C but there is some light at the end of the tunnel with the company continuing to focus on renovating and converting stores, as well as expanding its overall network including its omnichannel network.
</div>
The company's recent results saw sales decrease by -5.4% YoY to THB 34,161m in 2Q2021 mainly due to the decline in its retail business under the modern supply chain, which continued to be impacted by COVID-19 related issues. Despite the ongoing third wave in Thailand 3Q2020 is looking better on a YoY basis. 
Currently, 29 out of 77 provinces are dark red zones currently but this includes all the most populous areas of Thailand. Big C continues to see strong growth from food but faces pressure as Softline cannot be sold (non-essential) and non-food overall is a drag.
In terms of formats, Mini Big C and the company's supermarket format under The Food Place has been performing relatively well. Mini Big C are more like proximity mini-markets rather than convenience stores. 
Big C also continues to pursue its omnichannel approach to sales, which involves using third party operators but also using call and chat avenues through Line and Whatsapp. 
The company is also ramping up the renovations of its existing stores and has had a good experience so far with this exercise in terms of improving returns
The key catalyst for the retail business will come from a recovery in the tourism business, given that some of the company's stores had heavy exposure to sales to tourists pre-pandemic.
The company's packaging supply chain business saw a resilient performance in 2Q2021, with especially strong growth from its glass bottling business.
<a href="https://www.smartkarma.com/entities/berli-jucker-public-co-ltd" target="_blank" data-smartkarma-citation="entities:3685:1" rel="noopener">Berli Jucker (BJC TB)</a> saw strong performance in its consumer supply chain business, mainly due to the addition of Unicharm as a new client for Thailand for traditional markets.
<a href="https://www.smartkarma.com/entities/berli-jucker-public-co-ltd" target="_blank" data-smartkarma-citation="entities:3685:1" rel="noopener">Berli Jucker (BJC TB)</a> healthcare and technical division registered a steady performance in 2Q2021 with COVID-19 related products doing well plus new hospital budget-related orders driving growth.
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The company continues to make progress on its ESG credentials and became part of FTSE4Good Emerging Markets and FTSE4Good ASEAN 5 indices at the end of June.
<a href="https://www.smartkarma.com/entities/berli-jucker-public-co-ltd" target="_blank" data-smartkarma-citation="entities:3685:1" rel="noopener">Berli Jucker (BJC TB)</a> is an interesting proxy to the consumer recovery, not just in Thailand but also to South East Asia, given its exposure in Vietnam, and Malaysia. It remains cheap relative to peers, trading on 25.0x FY22E PER and 21.4x FY23E PER, with forecast EPS growth of +41.2% and +16.6%% for FY22E and FY23E respectively.


A call with Berli Jucker (BJC TB) management revealed ongoing pressure from the latest wave of COVID-19 in Thailand, which continues to impact the retail business under Big C but there is some light at the end of the tunnel with the company continuing to focus on renovating and converting stores, as well as expanding its overall network including its omnichannel network.

The company's recent results saw sales decrease by -5.4% YoY to THB 34,161m in 2Q2021 mainly due to the decline in its retail business under the modern supply chain, which continued to be impacted by COVID-19 related issues. Despite the ongoing third wave in Thailand 3Q2020 is looking better on a YoY basis. 
Currently, 29 out of 77 provinces are dark red zones currently but this includes all the most populous areas of Thailand. Big C continues to see strong growth from food but faces pressure as Softline cannot be sold (non-essential) and non-food overall is a drag.
In terms of formats, Mini Big C and the company's supermarket format under The Food Place has been performing relatively well. Mini Big C are more like proximity mini-markets rather than convenience stores. 
Big C also continues to pursue its omnichannel approach to sales, which involves using third party operators but also using call and chat avenues through Line and Whatsapp. 
The company is also ramping up the renovations of its existing stores and has had a good experience so far with this exercise in terms of improving returns
The key catalyst for the retail business will come from a recovery in the tourism business, given that some of the company's stores had heavy exposure to sales to tourists pre-pandemic.
The company's packaging supply chain business saw a resilient performance in 2Q2021, with especially strong growth from its glass bottling business.
Berli Jucker (BJC TB) saw strong performance in its consumer supply chain business, mainly due to the addition of Unicharm as a new client for Thailand for traditional markets.
Berli Jucker (BJC TB) healthcare and technical division registered a steady performance in 2Q2021 with COVID-19 related products doing well plus new hospital budget-related orders driving growth.



The company continues to make progress on its ESG credentials and became part of FTSE4Good Emerging Markets and FTSE4Good ASEAN 5 indices at the end of June.
Berli Jucker (BJC TB) is an interesting proxy to the consumer recovery, not just in Thailand but also to South East Asia, given its exposure in Vietnam, and Malaysia. It remains cheap relative to peers, trading on 25.0x FY22E PER and 21.4x FY23E PER, with forecast EPS growth of +41.2% and +16.6%% for FY22E and FY23E respectively.

Berli Jucker (BJC TB) - Bright Lights at the End of the Tunnel

A  call with <a href="https://www.smartkarma.com/entities/berli-jucker-public-co-ltd" target="_blank" data-smartkarma-citation="entities:3685:1" rel="noopener">Berli Jucker (BJC TB)</a> management post the company's recent results revealed a more cautious tone given the recent pick-up in COVID-19 cases in the so-called "third wave". 
Restaurants remain open and dining in is allowed although not permitted to serve alcohol and bars and nightclubs are shut under the current measures. Alcohol can be sold through retail outlets for consumption at home. Big C and Mini Big continue to sell alcohol through all of their outlets. 
<a href="https://www.smartkarma.com/entities/berli-jucker-public-co-ltd" target="_blank" data-smartkarma-citation="entities:3685:1" rel="noopener">Berli Jucker (BJC TB)</a> continued to experience difficult YoY comparisons for its packaging supply chain business, which is focused on glass bottling and aluminium cans, given that there was some stocking upon glass bottles last year in 1Q. 
<a href="https://www.smartkarma.com/entities/berli-jucker-public-co-ltd" target="_blank" data-smartkarma-citation="entities:3685:1" rel="noopener">Berli Jucker (BJC TB)</a> consumer supply chain division had a mixed picture given that non-food had a high base last year since tissue sales were very strong in 1Q2020, as was personal care, whilst demand for snacks remained soft.
For the company's healthcare and technical supply chain (H&amp;TSC), it saw a positive performance for the technical side, mainly driven by food additives but the lube business was relatively weaker
The company's core modern supply chain division, which consists mainly of its Big C retail business, continues to see big declines in both sales and SSSG given that January and February last year were relatively normal ahead of the onset of the pandemic. The higher portion of B2B sales to offset competition from traditional trade has negatively impacted margins slightly.
Big C continues to expand its store network with plans to add two new Big C hypermarkets this year and 100 mini-Big C proximity stores. There are also a number of Big C Marketplace stores being converted to other formats including Big C Depot and Food Place.
Omnichannel sales are growing, which include sales through Line and Whatsapp as well as various online channels now account for just under 3% of sales.
<a href="https://www.smartkarma.com/entities/berli-jucker-public-co-ltd" target="_blank" data-smartkarma-citation="entities:3685:1" rel="noopener">Berli Jucker (BJC TB)</a> will continue to face headwinds in 2Q2021, as the third wave impacts mobility and beer sales but YoY comparisons will start to get easier. We continue to see <a href="https://www.smartkarma.com/entities/berli-jucker-public-co-ltd" target="_blank" data-smartkarma-citation="entities:3685:1" rel="noopener">Berli Jucker (BJC TB)</a> as an interesting proxy to the consumer recovery, not just in Thailand but also to South East Asia, given its exposure in Vietnam, and Malaysia. It remains cheap relative to peers, with a stronger growth outlook for the next two years.

A  call with Berli Jucker (BJC TB) management post the company's recent results revealed a more cautious tone given the recent pick-up in COVID-19 cases in the so-called "third wave". 
Restaurants remain open and dining in is allowed although not permitted to serve alcohol and bars and nightclubs are shut under the current measures. Alcohol can be sold through retail outlets for consumption at home. Big C and Mini Big continue to sell alcohol through all of their outlets. 
Berli Jucker (BJC TB) continued to experience difficult YoY comparisons for its packaging supply chain business, which is focused on glass bottling and aluminium cans, given that there was some stocking upon glass bottles last year in 1Q. 
Berli Jucker (BJC TB) consumer supply chain division had a mixed picture given that non-food had a high base last year since tissue sales were very strong in 1Q2020, as was personal care, whilst demand for snacks remained soft.
For the company's healthcare and technical supply chain (H&amp;TSC), it saw a positive performance for the technical side, mainly driven by food additives but the lube business was relatively weaker
The company's core modern supply chain division, which consists mainly of its Big C retail business, continues to see big declines in both sales and SSSG given that January and February last year were relatively normal ahead of the onset of the pandemic. The higher portion of B2B sales to offset competition from traditional trade has negatively impacted margins slightly.
Big C continues to expand its store network with plans to add two new Big C hypermarkets this year and 100 mini-Big C proximity stores. There are also a number of Big C Marketplace stores being converted to other formats including Big C Depot and Food Place.
Omnichannel sales are growing, which include sales through Line and Whatsapp as well as various online channels now account for just under 3% of sales.
Berli Jucker (BJC TB) will continue to face headwinds in 2Q2021, as the third wave impacts mobility and beer sales but YoY comparisons will start to get easier. We continue to see Berli Jucker (BJC TB) as an interesting proxy to the consumer recovery, not just in Thailand but also to South East Asia, given its exposure in Vietnam, and Malaysia. It remains cheap relative to peers, with a stronger growth outlook for the next two years.

Berli Jucker (BJC TB) - Stock-Up for Canned Recovery?

Thailand

Central Retail Corp Ltd operates general merchandise stores. The Company offers electronics, sports, stationery, home improvement, and office products. Central Retail serves customers in Thailand.

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Central Retail Corp Ltd (CRC TB)

The Week That Was in ASEAN@Smartkarma - Sea Ltd & FreeFire, Arwana Citramulia, and CPO's Poor Show

The Week That Was in ASEAN@Smartkarma is filled with an eclectic mix of differentiated, substantive, and actionable insights, macro and equity...

Angus Mackintosh

Siam Makro Placement - Smaller Deal Size with a Tight Discount and No Fast Entry

Siam Makro Public (MAKRO TB) is looking to raise up to US$1.8bn. Placement price is fixed and discount is tight. There will also be no index fast...

Sumeet Singh

Berli Jucker (BJC TB) - Canned Recovery in Motion

Berli Jucker (BJC TTB) is on the cusp of a strong recovery going into 4Q2021, and even more so in 2021, mainly driven by its retail and packaging...

Angus Mackintosh

Berli Jucker (BJC TB) - Bright Lights at the End of the Tunnel

Berli Jucker's retail business under Big C continues to see pressure from COVID-19 issues but improvements are underway and it is expanding again,...

Angus Mackintosh

Berli Jucker (BJC TB) - Stock-Up for Canned Recovery?

Berli Jucker is an interesting proxy to the consumer recovery in Thailand and South-East Asia, through its packaging, retail, and consumer supply...

Angus Mackintosh

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