Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Bottom-Up

<ul>
<li>Based in Hong Kong, Dream International is one of the largest toy manufacturers in the world. It specializes on plush stuffed toys and plastic figures. </li>
<li>Despite the global toys markets going into destocking cycle, the company has generated significant growth in operating profit in the past year driven by strong demand for plush stuffed toys.</li>
<li>If we assume a moderate 20% YoY increase in dividends in 2023, this would imply DPS of HKD 0.48 and this would suggest a dividend yield of 12.7% current prices. </li>
</ul>


Based in Hong Kong, Dream International is one of the largest toy manufacturers in the world. It specializes on plush stuffed toys and plastic figures. 
Despite the global toys markets going into destocking cycle, the company has generated significant growth in operating profit in the past year driven by strong demand for plush stuffed toys.
If we assume a moderate 20% YoY increase in dividends in 2023, this would imply DPS of HKD 0.48 and this would suggest a dividend yield of 12.7% current prices. 


Japan Specialist

Mark Chadwick

<ul>
<li>Nexon is our top pick within the Japanese Gaming Sector </li>
<li>We see continued strong growth in revenue driven by existing game franchises in addition to new pipeline opportunities</li>
<li>Nexon is cash rich, debt free and is returning more and more money back to shareholders</li>
</ul>


Nexon is our top pick within the Japanese Gaming Sector 
We see continued strong growth in revenue driven by existing game franchises in addition to new pipeline opportunities
Nexon is cash rich, debt free and is returning more and more money back to shareholders


Nexon (3659) | More Buybacks in the Pipeline

Thematic (Sector/Industry)

<ul>
<li>OVERSEAS.  US Major Equity Indices fall over night with Tech leading the sell off; Oil prices (and Stocks) in the other direction; Negative China CPI-Deflation confirmed. </li>
<li>JAPAN.  NKY Futures -0.2% vs Cash; USDJPY 143.7;  China to allow Group Tours to Japan; EARNINGS: Positive Inpex and Nexon: Strong earnings and Buyback; Sony  earnings down on M&amp;A hangover</li>
<li>NUGGET. Yesterday's CPI print confirmed that China in Deflation. Looking for more aggressive stimulus. Monetary unlikely to work. Looking for A BIG FISCAL STIMULUS(at some point). Remain cautious China related. </li>
</ul>


OVERSEAS.  US Major Equity Indices fall over night with Tech leading the sell off; Oil prices (and Stocks) in the other direction; Negative China CPI-Deflation confirmed. 
JAPAN.  NKY Futures -0.2% vs Cash; USDJPY 143.7;  China to allow Group Tours to Japan; EARNINGS: Positive Inpex and Nexon: Strong earnings and Buyback; Sony  earnings down on M&amp;A hangover
NUGGET. Yesterday's CPI print confirmed that China in Deflation. Looking for more aggressive stimulus. Monetary unlikely to work. Looking for A BIG FISCAL STIMULUS(at some point). Remain cautious China related. 


Ohayo Japan| SPX Sell-Off Led by Tech/Discretionary Stocks; NUGGET: China-Double Whammy on Deflation

China/Asia TMT

Shawn Yang

China growth and global non-US Internet equities

Blue Lotus Research Institute

Blue Lotus Research is a Hong Kong Type 4 Licensed investment advisory firm focusing on Chinese growth equities and global non-US Internet equities

<ul>
<li>We expect that Tencent's 2Q23’s rev./non-IFRS net income to be 0.2%/5.2% vs cons. </li>
<li>We raise Tencent's ads growth in 2Q23 from 18.2% to 28.4% YoY per our recent checks with ads agencies. </li>
<li>There is an increasing possibility that "DNF Mobile" could be launched in the next several quarters. We raise the TP to $450, which implies 20.1X PE in 2023.</li>
</ul>


We expect that Tencent's 2Q23’s rev./non-IFRS net income to be 0.2%/5.2% vs cons. 
We raise Tencent's ads growth in 2Q23 from 18.2% to 28.4% YoY per our recent checks with ads agencies. 
There is an increasing possibility that "DNF Mobile" could be launched in the next several quarters. We raise the TP to $450, which implies 20.1X PE in 2023.


[Tencent (700 HK, BUY, TP HK$450) TP Change]: "DNF Mobile" And Strong Ads Are Two Catalysts

<ul>
<li>We suggest that both Tencent and NetEase will launch blockbuster new games in their pipelines during this year's summer vacation, with NetEase slightly surpassing Tencent.  </li>
<li>Although iQIYI, Kuaishou, and BILI each have new games, their contributions are relatively small, so we maintain a SELL rating for these three companies;</li>
<li>Investors can also pay attention to Nexon and Netmarble, two Korean game companies that are expected to benefit from the launch of new games;  </li>
</ul>


We suggest that both Tencent and NetEase will launch blockbuster new games in their pipelines during this year's summer vacation, with NetEase slightly surpassing Tencent.  
Although iQIYI, Kuaishou, and BILI each have new games, their contributions are relatively small, so we maintain a SELL rating for these three companies;
Investors can also pay attention to Nexon and Netmarble, two Korean game companies that are expected to benefit from the launch of new games;  


Blue Lotus Entertainment Sector Update: Tencent, NetEase and Kingsoft Have Strong Pipeline

Japan

Nexon Co., Ltd. mainly develops and services, online games for PC and mobile devices. The company also offers consulting services related to online-games. Nexon operates in Japan.

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Nexon (3659 JP)

Asian Dividend Gems: Dream International

Based in Hong Kong, Dream International is one of the largest toy manufacturers in the world. It specializes on plush stuffed toys and plastic...

Douglas Kim

Nexon (3659) | More Buybacks in the Pipeline

[EARNINGS] NEXON CO LTD(3659) Q2 FY12/2023 Operating Profit 27.614 billion yen,21.7%YoY inline with Consensus 27 billion yen. 3Q OP guidance...

Mark Chadwick

Ohayo Japan| SPX Sell-Off Led by Tech/Discretionary Stocks; NUGGET: China-Double Whammy on Deflation

US Equities sell off lead by Tech; NKY Futures -0.2% vs Cash; USDJPY 143.7; China to allow Group Tours to Japan; EARNINGS: Positive Inpex and...

Mark Chadwick

[Tencent (700 HK, BUY, TP HK$450) TP Change]: "DNF Mobile" And Strong Ads Are Two Catalysts

We expect that Tencent's 2Q23’s rev./non-IFRS net income to be 0.2%/5.2% vs cons. We raise the TP to $450, which implies 20.1X PE in 2023.

Blue Lotus Research Institute

Blue Lotus Entertainment Sector Update: Tencent, NetEase and Kingsoft Have Strong Pipeline

We suggest that both Tencent and NetEase will launch blockbuster new games in their pipelines during this year's summer vacation, with NetEase...

Blue Lotus Research Institute

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