New Zealand Professional Investment Services Firm, Forsyth Barr

Forsyth Barr

New Zealand Professional Investment Services Firm

We are proud to be a New Zealand owned firm, with 21 offices throughout the country and over 300 employees. We assist personal, institutional and corporate clients providing a full range of investment services.

Forsyth Barr is a foundation New Zealand Exchange firm (NZX) and accredited market participant. We have been confirmed by the Financial Markets Authority as a Qualifying Financial Entity (QFE).

Research is the cornerstone of our advice. We have one of New Zealand's leading teams of analysts. Our global affiliations ensure comprehensive research coverage of all major investment markets.

Equity Bottom-Up

<ul><li>Following our scenarios to assess the impact of the Chemist Warehouse (CW) contract loss in FY25, we walk away with increased comfort that EBO can navigate the loss without significant downside to current FY25 consensus expectations.</li><li>Representing only ~2% of EBO's group EBIT, we also think EBO should be able to absorb the loss of NZ CW supply contract which ends in 1H27 (should the recent competition changes drive this outcome).</li><li>In combination, our analysis provides increased confidence in the earnings outlook, however, we continue to see valuation as elevated in relative and absolute terms (even reflecting EBO's execution and change in business mix). Retain NEUTRAL. </li></ul>

Following our scenarios to assess the impact of the Chemist Warehouse (CW) contract loss in FY25, we walk away with increased comfort that EBO can navigate the loss without significant downside to current FY25 consensus expectations.Representing only ~2% of EBO's group EBIT, we also think EBO should be able to absorb the loss of NZ CW supply contract which ends in 1H27 (should the recent competition changes drive this outcome).In combination, our analysis provides increased confidence in the earnings outlook, however, we continue to see valuation as elevated in relative and absolute terms (even reflecting EBO's execution and change in business mix). Retain NEUTRAL. 

<ul><li>EBOS Group's (EBO) 1H24 result was solid. Importantly, (1) EBO's pharmacy performance and commentary should help allay fears around deteriorating industry dynamics, and (2) EBO continues to see solid cost-out opportunities.</li><li>While broader business trends remain constructive, EBO is trading on a FY25 PE of ~22x, modestly ahead of its 10 year average, and a ~+30% premium to the market median.</li><li>We back management to negate the possible negative operating leverage (EBO has several levers it can pull), but FY25 earnings are not risk-free as EBO transitions through the Chemist Warehouse (CW) contract loss. </li></ul>

EBOS Group's (EBO) 1H24 result was solid. Importantly, (1) EBO's pharmacy performance and commentary should help allay fears around deteriorating industry dynamics, and (2) EBO continues to see solid cost-out opportunities.While broader business trends remain constructive, EBO is trading on a FY25 PE of ~22x, modestly ahead of its 10 year average, and a ~+30% premium to the market median.We back management to negate the possible negative operating leverage (EBO has several levers it can pull), but FY25 earnings are not risk-free as EBO transitions through the Chemist Warehouse (CW) contract loss. 

EBOS Group - 1H24 Result — In Good Health

<ul><li>With the first four months of trading already released, it is unlikely that EBOS Group's (EBO) 1H24 result will surprise.</li><li>We expect it to be a typically solid result. Key focus areas are: (1) cost out initiatives in light of the pending Chemist Warehouse (CW) contract loss (or at least commentary on the outlook), (2) pharmacy industry dynamics, and (3) M&amp;A outlook/strategy in light of the considered Greencross deal in November.</li></ul>

With the first four months of trading already released, it is unlikely that EBOS Group's (EBO) 1H24 result will surprise.We expect it to be a typically solid result. Key focus areas are: (1) cost out initiatives in light of the pending Chemist Warehouse (CW) contract loss (or at least commentary on the outlook), (2) pharmacy industry dynamics, and (3) M&amp;A outlook/strategy in light of the considered Greencross deal in November.

EBOS Group - 1H24 Preview — Costs & Chemist Warehouse

Asia Pac IPO & Placement Research, China biotech, Aequitas Research

Ke Yan, CFA, FRM

Asia Pac IPO & Placement Research, China biotech

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.

Quantitative Analysis

<ul>
<li>We analyzed the changes in short interest of ASX Stocks as of Nov 15th (reported today) which has an aggregated short interest worth USD24.6bn.</li>
<li>We tabulate league table for top short by value and short as multiple of ADT, as well as weekly increases &amp; decreases in short value, short as multiple of ADT.</li>
<li>We highlight short interest changes in ANZ, James Hardie Industries, Endeavour, Goodman.</li>
</ul>


We analyzed the changes in short interest of ASX Stocks as of Nov 15th (reported today) which has an aggregated short interest worth USD24.6bn.
We tabulate league table for top short by value and short as multiple of ADT, as well as weekly increases &amp; decreases in short value, short as multiple of ADT.
We highlight short interest changes in ANZ, James Hardie Industries, Endeavour, Goodman.


ASX Short Interest Weekly (Nov 15th): ANZ, James Hardie Industries, Endeavour, Goodman

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>The ACCC has approved a merger deal between pharmacy wholesaler <strong><a href="https://www.smartkarma.com/entities/sigma-healthcare-ltd" target="_blank" data-smartkarma-citation="entities:15966:1" rel="noopener">Sigma Healthcare (SIG AU)</a></strong> and pharmacy franchiser Chemist Warehouse, saying the transaction won't substantially lessen competition in Australia's pharmaceutical industry.</li>
<li>The merger still requires the approval of Chemist Warehouse and Sigma's shareholders, both of which should be a formality.  Plus New Zealand's OIO. This <em>could</em> potentially wrap up late-Dec/early-Jan.</li>
<li>Sigma is up bigly as I type as investors get exposure to Chemist Warehouse's hybrid IPO. However, implied MergeCo pricing appears elevated.</li>
</ul>


The ACCC has approved a merger deal between pharmacy wholesaler Sigma Healthcare (SIG AU) and pharmacy franchiser Chemist Warehouse, saying the transaction won't substantially lessen competition in Australia's pharmaceutical industry.
The merger still requires the approval of Chemist Warehouse and Sigma's shareholders, both of which should be a formality.  Plus New Zealand's OIO. This could potentially wrap up late-Dec/early-Jan.
Sigma is up bigly as I type as investors get exposure to Chemist Warehouse's hybrid IPO. However, implied MergeCo pricing appears elevated.


ACCC Greenlights Sigma/Chemist Warehouse Merger

New Zealand

EBOS Group Limited supplies and distributes medical consumable products and equipment to the hospital and primary care sectors of the New Zealand and Australian healthcare markets. The Company's products include diagnostic instruments, surgical instruments and prosthesis, feminine protection, anesthetic equipment, and other consumer products.

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Ebos Group Ltd (EBO NZ)

EBOS Group - The Final CW Check-Up

Following our scenarios to assess the impact of the Chemist Warehouse (CW) contract loss in FY25, we walk away with increased comfort that EBO can...

Forsyth Barr

EBOS Group - 1H24 Result — In Good Health

While broader business trends remain constructive, EBO is trading on a FY25 PE of ~22x, modestly ahead of its 10 year average, and a ~+30% premium...

Forsyth Barr

EBOS Group - 1H24 Preview — Costs & Chemist Warehouse

With the first four months of trading already released, it is unlikely that EBOS Group's (EBO) 1H24 result will surprise. We expect it to be a...

Forsyth Barr

ASX Short Interest Weekly (Nov 15th): ANZ, James Hardie Industries, Endeavour, Goodman

We analyzed ASX short interest report for the past week and highlight short interest changes in ANZ, James Hardie Industries, Endeavour, Goodman.

Ke Yan, CFA, FRM

ACCC Greenlights Sigma/Chemist Warehouse Merger

Punchy move today. And trading at levels well beyond peers. This development is very positive - Sigma/CWG will be a powerhouse. But a lot of...

David Blennerhassett

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