Asian Insight Provider - Actionable ideas, CrossASEAN Research

Henry Soediarko

Asian Insight Provider - Actionable ideas

Equity Bottom-Up

Construction business typically has a decent margin with strong growth especially in the emerging economies but what if they also have created another revenue stream with a much higher margin which creates a situation that the new business has contributed almost half of the total margin? Please give a round of applause to <a href="https://www.smartkarma.com/entities/23077" target="_blank" data-smartkarma-citation="entities:23077:1">Megawide Construction Corp (MWIDE PM)</a> . Initially started as construction company 20 years ago, the company has diversified from construction projects to airport operations which has much higher margin despite only has 1 airport to operate so far. And there are 71 airports in the Philippine in total and Megawide is by far the largest private airport operator.<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/042/644/original/mwide.PNG?1516593241" class="editor-image img-responsive" data-smartkarma-image-id="42644"></figure><div class="content-caption">source: company data</div><div class="content-highlight">According to the company's 9M 2017 data as depicted above, airport operations only make 12% of the revenue but due to the high margin (around 82%), the gross margin contribution adds up to 41% of the company's gross margin. That's quite something don't you think?</div>

Construction business typically has a decent margin with strong growth especially in the emerging economies but what if they also have created another revenue stream with a much higher margin which creates a situation that the new business has contributed almost half of the total margin? Please give a round of applause to Megawide Construction Corp (MWIDE PM) . Initially started as construction company 20 years ago, the company has diversified from construction projects to airport operations which has much higher margin despite only has 1 airport to operate so far. And there are 71 airports in the Philippine in total and Megawide is by far the largest private airport operator.source: company dataAccording to the company's 9M 2017 data as depicted above, airport operations only make 12% of the revenue but due to the high margin (around 82%), the gross margin contribution adds up to 41% of the company's gross margin. That's quite something don't you think?

Megawide: A Mega Airport Operator in the Making

Asia Ex-J Consumer/ Transport analyst

Valerie Law, CFA

Thematic (Sector/Industry)

The global edtech market is expected to grow 17% a year - hitting USD 252bn by 2020, according to research by IBIS Capital. Global tech companies such as Google, LinkedIn and Tencent all have their fingers in the pie. With so many Edtech companies out there seeking funds, how should we pick which ones to invest in?As part of an Edtech series, this first article provides an overview of Edtech firms' business model, and examines the key advantages that traditional education institutions have, against which Edtech firms will be measured:  1. Trust that they can deliver ‘quality’ outcomes 2. Discipline offered within a physical classroom 3. Customized diagnosis by a teacher/instructor 4. Modelling – a universal way by which humans learn 5. Stimulation of various parts of the brain

 The global edtech market is expected to grow 17% a year - hitting USD 252bn by 2020, according to research by IBIS Capital. Global tech companies such as Google, LinkedIn and Tencent all have their fingers in the pie. With so many Edtech companies out there seeking funds, how should we pick which ones to invest in?As part of an Edtech series, this first article provides an overview of Edtech firms' business model, and examines the key advantages that traditional education institutions have, against which Edtech firms will be measured:   1. Trust that they can deliver ‘quality’ outcomes 2. Discipline offered within a physical classroom 3. Customized diagnosis by a teacher/instructor 4. Modelling – a universal way by which humans learn 5. Stimulation of various parts of the brain

Ed or Tech, Edtech Firms Must Cross These Moats

Making sense of the Global Market, Euromonitor International Ltd.

Yu Mitsuhashi

Making sense of the Global Market

Euromonitor International Ltd.

We are a global market research company focused on industries, countries, economies and consumers worldwide. Our cross-country comparable research helps your organisation identify opportunities and develop growth strategies in countries and regions across the globe. With offices around the world, 1,200 analysts in 100 countries and market research on every key trend and driver, we give you powerful access to the real story behind consumer change.

As a result of high income inequality, the Philippines' consumer market is characterised by marked differences in spending patterns across income deciles. While decile 1 has to allocate most of its spending to cover basic needs, decile 10 is able to splurge on hotels and catering, leisure and recreation and education (which are the most discretionary spending categories in <a target="_blank">the Philippines</a>). Given that decile 10 is projected to record the largest rise in discretionary spending capacity across all…

As a result of high income inequality, the Philippines' consumer market is characterised by marked differences in spending patterns across income deciles. While decile 1 has to allocate most of its spending to cover basic needs, decile 10 is able to splurge on hotels and catering, leisure and recreation and education (which are the most discretionary spending categories in the Philippines). Given that decile 10 is projected to record the largest rise in discretionary spending capacity across all…

Philippines: Wealthy Households to Enjoy the Rise in Discretionary Spending Capa. Through to 2030

Philippines

Wilcon Depot, Inc. supplies home improvement and construction materials. The Company offers building materials, appliances, plumbing and sanitary wares, paints, housewares, hardwares, tools, furniture, electrical, lighting, furnishing, and tiles and flooring products. Wilcon Depot serves customers in Philippines.

Centro Escolar University, an institution of higher learning, provides instruction and training programs in the Philippines. The company establishes, maintains, and operates educational institutions that offer programs in the fields of arts and sciences for classes in tertiary level. It provides various college and graduation courses, including dentistry, optometry, music, and public administration in the fields of commerce, science, and arts; and 11 under graduation programs. The company also specializes in medical technology, nursing, education, nutrition, optometry, pharmacy, and business education courses. It operates in Mendiola, Malolos, Makati-Gil Puyat, and Makati-Legaspi. Centro Escolar University was founded in 1907 and is based in Manila, the Philippines.

iPeople, inc., together with its subsidiaries, engages in the education, consulting development, and installation and maintenance of information technology systems in the Philippines. The company operates through two segments, Information Technology and Education, and Others. It operates Mapua Institute of Technology that offers various courses of study, including engineering and sciences, social sciences, graduate studies, engineering management, architecture and design, information technology, business and management, multimedia arts and sciences, and health science. The company also operates Malayan college located in Laguna; and Malayan high school of sciences, a science and math oriented high school located in Pandacan, Manila. In addition, its Mapua information technology center offers various training modules, such as Dot Net, CCNA voice, Cisco, custom courses, English proficiency, JAVA, office automation, and project management for high school students, career shifters, and professionals. Further, iPeople, inc. operates the Pan Pacific Computer Center that resells computer hardware and peripherals, and software licenses and packages; and provides value-added information technology (IT) services, such as server hosting, document management, and help-desk assistance. The company was formerly known as Petrofields Exploration and Development Co., Inc. and changed its name to iPeople, inc. in December 1999. The company was founded in 1989 and is based in Makati, the Philippines. iPeople, inc. is a subsidiary of House of Investments, Inc.

ABS-CBN Corporation, together with its subsidiaries, engages in the television and radio broadcasting business in the Philippines, the United States, the Middle East, Europe, Australia, Canada, and Japan. The company operates through three segments: TV and Studio, Pay TV Networks, and New Businesses. It also offers cable and satellite programming, money remittance, trading, telecommunications, music and print publishing, content development and programming, educational/training, interactive media, and support and call center services. In addition, the company provides restaurant and food, broadband Internet, merchandising, and mobile services; and marketing, sales, and advertising services, as well as operates theme parks. Further, it is involved in the movie production; audio and video production and distribution; real estate; digital electronic content distribution; digital film archiving and central library; content licensing and transmission; non-vessel common carrier; and audio recording and distribution, video/audio post production, and film distribution operations. The company operates 11 commercial television stations and 21 radio stations; and delivers television programming outside of the Philippines to approximately 3.1 million viewers through the Internet, satellite service, cable television channels, and IPTV. ABS-CBN Corporation was founded in 1946 and is headquartered in Quezon City, the Philippines. ABS-CBN Corporation operates as a subsidiary of Lopez, Inc.

Pacific Online Systems Corporation designs, develops, and manages online computer systems, terminals, and software for the gaming industry in the Philippines. It operates through Leasing Activities, and Distribution and Retail Activities segments. The company sources technology from various suppliers of integrated gaming systems, and leases the equipment needed for the online lottery operations to the Philippine Charity Sweepstakes Office (PCSO). It is also involved in the provision of technical support services to PCSO. In addition, the company distributes and sells instant tickets under the Scratchit brand name, as well as sells lottery and sweepstakes. Further, it manages a network of approximately 260 retail outlets that provide Lotto, Keno, and Scratchit products. The company was incorporated in 1993 and is headquartered in Pasig City, the Philippines.

Philippine Racing Club, Inc., together with its subsidiaries, operates and maintains race tracks in metro Manila and other parts of the Philippines. It also manages betting stations; holds horse races; leases out stables; acquires, develops, and sells real estate properties, including leisure, recreational, and memorial parks; and owns, operates, manages, and/or sells real estate properties. The company was founded in 1937 and is based in Cavite, the Philippines.

Manila Broadcasting Company primarily engages in the radio broadcasting business in the Philippines. The company offers programming formats, such as DZRH, Aksyon Radyo, Love Radio, YES FM, Hot-FM, RHTV, Radyo Natin, and Easy Rock. It operates 1 AM and 3 FM stations in Metro Manila; and 10 Aksyon Radyo, 24 Love Radio, 11 Yes-FM, 7 Easy Rock, and approximately 100 Radyo Natin stations in the provinces of the Philippines. The company also broadcasts and organizes events; and produces and sponsors concerts. Manila Broadcasting Company was incorporated in 1947 and is based in Pasay City, the Philippines. Manila Broadcasting Company is a subsidiary of Elizalde Holdings Corporation.

Max's Group Incorporated is a chained full service restaurant in the casual dining segment operating a portfolio of brands both domestically and overseas. The Company is also licensed to operate certain international food brands.

PhilWeb Corporation provides gaming technology in the Asia Pacific region. It owns and operates e-Games cafes, Internet caf�, and kiosks that offer casino games, including baccarat, blackjack, various slot machine games, video poker, and sports betting. The company also develops and manufactures computer-based automated terminals; and operates various lottery and scratch card games. In addition, it is involved in developing and marketing computer and gaming systems, software applications, and programs; and the operation of gaming platforms in relation to Premyo sa Resibo program of the BIR, and Philippine Amusement and Gaming Corporation. Further, the company engages in the business of setting up Internet bingo stations and its operations, as well as operates and provides consultancy services related to amusement, recreational, gaming and gaming equipment facilities, and enterprises. The company was formerly known as PhilWeb.Com, Inc. and changed its name to PhilWeb Corporation in November 2002. PhilWeb Corporation was incorporated in 1969 and is based in Makati, the Philippines.

Solid Group Inc., an investment holding company, engages in distribution, real estate, and other related service businesses in the Philippines. The company�s Distribution segment sells professional audio and video equipment and peripherals, mobile phones, and prefabricated modular houses and office units. Its Real Estate segment develops, leases, and sells industrial and other real estate properties. The company�s Other Related Services segment provides broadband, after sales, investing, financing, and other services. Solid Group Inc. also offers cable and satellite, audio and video products repair, and logistics services; sells LCD televisions; operates hotels; and assembles consumer electronics products, as well as develops mobile applications. The company was formerly known as United Paracale Mining Company and changed its name to Solid Group Inc. in June 1996. Solid Group Inc. was incorporated in 1933 and is based in Makati, the Philippines.

Fleetwood Corporation Limited provides modular accommodation solutions. The Company manufactures and sells caravans, parts and accessories along with design, manufacture, sale and rental of portable buildings.

HARAKOSAN CO., LTD. develops, sells, and leases condominiums and residential buildings.  The Company also sells solar power systems.

Anam Electronics Co., Ltd. specializes in manufacturing audio and video products, such as wide screen televisions, video cassette recorders, and DVD players.  The Company also produces digital set-top boxes that receive satellite broadcasting programs.

Ainavo Holdings Co Ltd sells and installs housing fixtures such as bathroom equipment and peripherals including tiles, bricks, and decorative stones. The Company also sells, designs, and constructs sanitary equipment, air conditioning equipment, imported stones, and pipe sections.

Suminoe Textile Co., Ltd manufactures and sells interior products. The company is engaged in arranging interior products such as curtains, carpets, and drapes for commercial use.  Suminoe Textile also produces seats, carpets, and ceiling materials for automobiles.

The Global Ltd. develops, sells, and leases condominiums, detached houses, and commercial buildings.  The Company also provides asset management and real estate brokerage services.

Nakanishi Manufacturing Co Ltd manufactures and sells kitchen equipment for commercial use.  The Company's products include rice cookers, roasters, dish washers, tableware, and sterilizing equipment.  Nakanishi's customer base consists of schools, hospitals, caterers, and restaurants, including fast-food establishments such as McDonald's.

First Juken Co,.Ltd. builds and sells residential buildings.  The Company also operates real estate brokerage, leasing and management businesses. Additionally, First Juken provides construction consulting services.

Lii Hen Industries Berhad is an investment holding company.  The Company, through its subsidiaries, manufactures and markets dining and other household furniture. Lii Hen also processes kiln drying of rubber wood and timber.

Thinkware Systems Corp. designs, manufactures, and markets navigational devices. The Company' products include portable navigation devices, hand-held navigation, and navigation software.  Thinkware Systems also provides location based services (LBS) through mobile networks which enables users to identify location of other users and obtain live traffic information, etc.

Megawide Construction Corporation engages in the general construction business in the Philippines. It operates through the Construction and Airport Operations segments. The company is primarily involved in constructing, enlarging, repairing, or engaging in various works upon buildings, houses and condominiums, roads, plants, bridges, piers, waterworks, railroads, and other structures. It also owns, uses, enhances, and develops various kinds of real estate properties. In addition, the company undertakes general construction projects, which comprise site development, earth works, structural and civil works, masonry works, architectural finishes, electrical works, plumbing and sanitary works, fire protection works, and mechanical works. Further, the company constructs, operates, maintains, renovates, and rehabilitates the Mactan Cebu International Airport. Megawide Construction Corporation was founded in 1997 and is based in Pasay, the Philippines. Megawide Construction Corporation is a subsidiary of Citicore Holdings Investment, Inc.

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Megawide Construction (MWIDE PM)

Megawide: A Mega Airport Operator in the Making

Construction business typically has a decent margin with strong growth especially in the emerging economies but what if they also have created...

Henry Soediarko

Ed or Tech, Edtech Firms Must Cross These Moats

The global edtech market is expected to grow 17% a year - hitting USD 252bn by 2020, according to research by IBIS Capital. Global tech companies...

Valerie Law, CFA

Philippines: Wealthy Households to Enjoy the Rise in Discretionary Spending Capa. Through to 2030

As a result of high income inequality, the Philippines' consumer market is characterised by marked differences in spending patterns across income...

Euromonitor International Ltd.

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