Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Event-Driven

<ul>
<li>On 23 September, Hanwha Solutions announced a set of restructuring measures which are probably the biggest ever moves by the company in the past 50 years.</li>
<li>The spin-off of the Hanwha Galleria is a good move. Clearly, having both the renewable energy and a luxury department store business under one roof does not make much sense.</li>
<li>We also like the company's move expand its U.S. solar module production capacity. The total amount of potential benefit could be nearly US$2 billion over the next decade. </li>
</ul>


On 23 September, Hanwha Solutions announced a set of restructuring measures which are probably the biggest ever moves by the company in the past 50 years.
The spin-off of the Hanwha Galleria is a good move. Clearly, having both the renewable energy and a luxury department store business under one roof does not make much sense.
We also like the company's move expand its U.S. solar module production capacity. The total amount of potential benefit could be nearly US$2 billion over the next decade. 


Hanwha Solutions: Biggest Restructuring Measures in 50 Years

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Equity Capital Markets

China Tourism Group Duty Free / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/china-tourism-group-duty-free-corporation-limited" target="_blank" data-smartkarma-citation="entities:36229:1" rel="noopener">China Tourism Group Duty Free Corp Ltd (1880 HK)</a>/CTGDF priced its H Share at HK$158.00 per share to raise net proceeds of US$2.0 billion. The H Share starts trading tomorrow.</li>
<li>The H Share listing price implies an AH discount of 27.2% at A Share price of RMB189.80. This compares to an average AH discount of 46.6% of listed AH shares.</li>
<li>The <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> A Shares are trading close to fair value. The H Shares valuation is unattractive compared to peers. </li>
</ul>



China Tourism Group Duty Free Corp Ltd (1880 HK)/CTGDF priced its H Share at HK$158.00 per share to raise net proceeds of US$2.0 billion. The H Share starts trading tomorrow.
The H Share listing price implies an AH discount of 27.2% at A Share price of RMB189.80. This compares to an average AH discount of 46.6% of listed AH shares.
The China Tourism Group Duty Free Corp Ltd (601888 CH) A Shares are trading close to fair value. The H Shares valuation is unattractive compared to peers. 


CTG Duty Free H Share Listing: Trading Debut

China Tourism Group Duty Free Corp Ltd / Equity Capital Markets

<ul>
<li>
<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> has launched its H Share listing at HK$143.50-165.50 per share. Pricing is on 18 August and listing on 25 August.</li>
<li>In <a href="https://www.smartkarma.com/insights/ctg-duty-free-h-share-listing-another-false-dawn" target="_blank" data-smartkarma-citation="insights:78718" rel="noopener">CTG Duty Free H Share Listing: Another False Dawn?</a>, we noted that on a fundamental view, we would prefer to remain on the sidelines.</li>
<li>Our valuation analysis suggests that the A Shares are trading close to fair value and the H Share valuation is unattractive compared to peers. We would pass on the listing.</li>
</ul>



China Tourism Group Duty Free Corp Ltd (601888 CH) has launched its H Share listing at HK$143.50-165.50 per share. Pricing is on 18 August and listing on 25 August.
In CTG Duty Free H Share Listing: Another False Dawn?, we noted that on a fundamental view, we would prefer to remain on the sidelines.
Our valuation analysis suggests that the A Shares are trading close to fair value and the H Share valuation is unattractive compared to peers. We would pass on the listing.


CTG Duty Free H Share Listing: Valuation Insights

<ul>
<li>
<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>/CTGDF, the largest travel retail operator in the world, aims to launch an H Share listing to raise US$2-3 billion on Friday.</li>
<li>CTGDF is a play on the normalization of domestic travel. However, the H Share listing timing is not ideal as a vital summer travel market, Sanya, is under renewed lockdown. </li>
<li>The recovery timing has again shifted, with expectations of a 4Q recovery, but 2022 consensus expectations look slightly optimistic. We prefer to remain on the sidelines.</li>
</ul>



China Tourism Group Duty Free Corp Ltd (601888 CH)/CTGDF, the largest travel retail operator in the world, aims to launch an H Share listing to raise US$2-3 billion on Friday.
CTGDF is a play on the normalization of domestic travel. However, the H Share listing timing is not ideal as a vital summer travel market, Sanya, is under renewed lockdown. 
The recovery timing has again shifted, with expectations of a 4Q recovery, but 2022 consensus expectations look slightly optimistic. We prefer to remain on the sidelines.


CTG Duty Free H Share Listing: Another False Dawn?

Equity Bottom-Up

<ul>
<li>Starting 18 March, the current $5,000 purchase limit at the domestic duty free shops will be abolished for the locals.</li>
<li>The removal of the $5,000 purchase limit at duty free shops in Korea should encourage purchase of luxury women's apparel, bags, and cosmetics.</li>
<li>The removal of the purchase limit should help the major duty free operators in Korea including Hotel Shilla (008770 KS) and Shinsegae (004170 KS).  </li>
</ul>


Starting 18 March, the current $5,000 purchase limit at the domestic duty free shops will be abolished for the locals.
The removal of the $5,000 purchase limit at duty free shops in Korea should encourage purchase of luxury women's apparel, bags, and cosmetics.
The removal of the purchase limit should help the major duty free operators in Korea including Hotel Shilla (008770 KS) and Shinsegae (004170 KS).  


Elimination of Purchase Limits at Duty Free Shops in Korea

South Korea

Shinsegae Co., Ltd. operates department stores in South Korea.  The Company retails food, clothing, household goods, electronics, and other items through several branch stores.

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Shinsegae (004170 KS)

Hanwha Solutions: Biggest Restructuring Measures in 50 Years

On 23 September, Hanwha Solutions announced a set of restructuring measures which are probably the biggest ever moves by the company in the past 50...

Douglas Kim

Elimination of Purchase Limits at Duty Free Shops in Korea

Starting 18 March, the current $5,000 purchase limit at the domestic duty free shops will be abolished for the locals which should help Hotel...

Douglas Kim

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Hanwha Solutions: Biggest Restructuring Measures in 50 Years

On 23 September, Hanwha Solutions announced a set of restructuring measures which are probably the biggest ever moves by the company in the past 50...

Douglas Kim

CTG Duty Free H Share Listing: Trading Debut

The H Share listing price implies an AH discount of 27.2% at the last close A Share price of RMB189.80. The AH discount and H Shares valuation are...

Arun George

CTG Duty Free H Share Listing: Valuation Insights

Our valuation analysis suggests that the A Shares are trading close to fair value and the H Share valuation is unattractive compared to peers. We...

Arun George

CTG Duty Free H Share Listing: Another False Dawn?

We are inclined to avoid the H Share listing as with a renewed lockdown in a key summer travel region, CTGDF has had one too many false dawns of...

Arun George

Elimination of Purchase Limits at Duty Free Shops in Korea

Starting 18 March, the current $5,000 purchase limit at the domestic duty free shops will be abolished for the locals which should help Hotel...

Douglas Kim