Smartkarma Research Team, Smartkarma

Smartkarma Research

Smartkarma Research Team

Smartkarma

Smartkarma unites the fragmented investment industry, connecting institutional investors, independent research providers, and corporates within a single network.

Research Reinvented

Equity Bottom-Up

<p>For our next Corporate Webinar, we are glad to welcome <a href="https://www.smartkarma.com/entities/taste-gourmet-group-ltd" target="_blank" data-smartkarma-citation="entities:27339" rel="noopener">Taste Gourmet Group (8371 HK)</a> CFO and Company Secretary, Gerald Yu. In the upcoming webinar, Gerald will share a short company presentation with on-the-ground insights from Hong Kong, after which he will engage in a fireside chat with Smartkarma Analyst <a href="https://www.smartkarma.com/profiles/sameer-taneja-a0539e0c-84dd-4e66-9c40-6e598edfb4c5" target="_blank" data-smartkarma-citation="accounts:352" rel="noopener">Sameer Taneja</a>. A live Q&amp;A session will follow.</p>
<h3>The Corporate Webinar will be hosted on Tuesday, 17 May 2022, 17:00 SGT.</h3>
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<h2><a href="https://share.hsforms.com/1H9pFZOB-RF2J00kbvMmxcw2c5gj?zoom_webinar_id=84780498112" target="_blank" rel="noopener">Register for the Webinar here</a></h2>
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<p>Taste Gourmet Group Limited is a Hong Kong-based restaurant group offering a variety of cuisines, under a portfolio of brands, to a diversified customer base. Since the opening of its first restaurant in 2007, the group has owned and operated a total of 34 restaurants offering Vietnamese, Japanese, Chinese, Western, and Drink under 14 brands, including 11 self-owned brands such as La’taste Vietnamese Cuisine, Dab-Pa Peking &amp; Szechuan Cuisine, Dab-Pa Peking &amp; Szechuan Bistro, Dab-pa Modern Chinese Cuisine, Urawa Japanese Restaurant, Nabe Urawa, Rakuraku Ramen, Wasyohuya Yamaichi, Moments Together, Yakiniku Guu, San-Kinn, three licensed brands known as Parkview, Takano Ramen, and Tirpse, and one joint venture brand known as Xianghui.</p>
<p>Corporate Webinars by <a href="https://www.smartkarma.com/home/corporate-solutions/" target="_blank" rel="noopener">Smartkarma Corporate Solutions</a> feature discussions with IROs and Executives, discussing their companies, the challenges they face, and the opportunities in their sectors and markets.</p>

For our next Corporate Webinar, we are glad to welcome Taste Gourmet Group (8371 HK) CFO and Company Secretary, Gerald Yu. In the upcoming webinar, Gerald will share a short company presentation with on-the-ground insights from Hong Kong, after which he will engage in a fireside chat with Smartkarma Analyst Sameer Taneja. A live Q&amp;A session will follow.
The Corporate Webinar will be hosted on Tuesday, 17 May 2022, 17:00 SGT.

Register for the Webinar here

Taste Gourmet Group Limited is a Hong Kong-based restaurant group offering a variety of cuisines, under a portfolio of brands, to a diversified customer base. Since the opening of its first restaurant in 2007, the group has owned and operated a total of 34 restaurants offering Vietnamese, Japanese, Chinese, Western, and Drink under 14 brands, including 11 self-owned brands such as La’taste Vietnamese Cuisine, Dab-Pa Peking &amp; Szechuan Cuisine, Dab-Pa Peking &amp; Szechuan Bistro, Dab-pa Modern Chinese Cuisine, Urawa Japanese Restaurant, Nabe Urawa, Rakuraku Ramen, Wasyohuya Yamaichi, Moments Together, Yakiniku Guu, San-Kinn, three licensed brands known as Parkview, Takano Ramen, and Tirpse, and one joint venture brand known as Xianghui.
Corporate Webinars by Smartkarma Corporate Solutions feature discussions with IROs and Executives, discussing their companies, the challenges they face, and the opportunities in their sectors and markets.

Smartkarma Corporate Webinar | Taste Gourmet: Reopening Play in Hong Kong

Equity, Bottom-up Analyst, Investics Research

Sameer Taneja

Equity, Bottom-up Analyst

Investics Research

It is important to note that the information provided by Investics Research is based on publicly available data and own knowledge, which has been gathered and analyzed from a variety of sources. While every effort has been made to ensure the accuracy and completeness of the information provided, it is not guaranteed to be free from errors or omissions. All forecasts and estimates are based on information that has been obtained from public sources that are considered to be reliable. The sources include but are not limited to, company announcements, exchange filings, presentations, etc. Investics does not guarantee the accuracy and completeness of the forecasts, estimates, and/or other information.

Equity Bottom-up Research

<ul>
<li>The relaxing of restrictions by Hong Kong makes <a href="https://www.smartkarma.com/entities/taste-gourmet-group-ltd" target="_blank" data-smartkarma-citation="entities:27339:1" rel="noopener">Taste Gourmet Group Ltd (8371 HK)</a> a great reopening play, trading at 8.8x FY22e and 5.6x FY23e. </li>
<li>Despite a challenging environment, the company has executed well, maintaining net margins north of 7-8%, which are far superior to other listed competitors.</li>
<li>With &gt;60% payout ratios, it trades at a dividend yield of 6.7%/11.4% FY22e/FY23e. Since 29% of the market capitalization is cash, we are confident in the dividend payments. </li>
</ul>


The relaxing of restrictions by Hong Kong makes Taste Gourmet Group Ltd (8371 HK) a great reopening play, trading at 8.8x FY22e and 5.6x FY23e. 
Despite a challenging environment, the company has executed well, maintaining net margins north of 7-8%, which are far superior to other listed competitors.
With &gt;60% payout ratios, it trades at a dividend yield of 6.7%/11.4% FY22e/FY23e. Since 29% of the market capitalization is cash, we are confident in the dividend payments. 


Taste Gourmet: Multibagger Reopening Play

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 has seen Insights on <a href="https://www.smartkarma.com/entities/grab-holdings-inc" target="_blank" data-smartkarma-citation="entities:26950:1" rel="noopener">Grab (GRAB US)</a>, <a href="https://www.smartkarma.com/entities/sumber-alfaria-trijaya-tbk-pt" target="_blank" data-smartkarma-citation="entities:15659:1" rel="noopener">Sumber Alfaria Trijaya (AMRT IJ)</a>, <a href="https://www.smartkarma.com/entities/semen-indonesia-persero-tbk" target="_blank" data-smartkarma-citation="entities:11161:1" rel="noopener">Semen Indonesia (Gresik) (SMGR IJ)</a>, and the <a href="https://www.smartkarma.com/entities/mapletree-commercial-trust" target="_blank" data-smartkarma-citation="entities:106:1" rel="noopener">Mapletree Commercial Trust (MCT SP)</a> deal.</li>
<li>We also explored online groceries in South-East Asia as we see increasing interest in the space plus <a href="https://www.smartkarma.com/profiles/nicolas-van-broekhoven-24a66c2d-bca4-4f5b-adda-c4e2bcc509f4" target="_blank" data-smartkarma-citation="accounts:1208" rel="noopener">Nicolas Van Broekhoven</a> also lays out his top picks for 2022 performance.</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 has seen Insights on Grab (GRAB US), Sumber Alfaria Trijaya (AMRT IJ), Semen Indonesia (Gresik) (SMGR IJ), and the Mapletree Commercial Trust (MCT SP) deal.
We also explored online groceries in South-East Asia as we see increasing interest in the space plus Nicolas Van Broekhoven also lays out his top picks for 2022 performance.


The Week That Was in ASEAN@Smartkarma - Grab Expands, Alfamart, and Mapletree Mega-Merger

<p>We received a positive profit alert for H1 2022 for <a href="https://www.smartkarma.com/entities/taste-gourmet-group-ltd" target="_blank" data-smartkarma-citation="entities:27339:1" rel="noopener">Taste Gourmet Group Ltd (8371 HK)</a>, as expected in our last insight, <a href="https://www.smartkarma.com/insights/taste-gourmet-conviction-growing-as-execution-remains-solid" target="_blank" data-smartkarma-citation="insights:57186" rel="noopener">Taste Gourmet: Conviction Growing As Execution Remains Solid</a>,  the numbers based on the profit alert though are below our expectations which we largely believe is due to higher employee and food costs (we will get more clarity on this when the results are fully published on the 12th of November 2021). We calculate the H1 FY22 profits based on the alert released at 24 mn HKD (vs. our expectation of around 27 mn HKD).</p>
<p>We believe that the company is still on track to hit a 60 mn HKD profit number for FY22, putting it at 6.5x FY22 PE. We also believe that the management will adhere to a 50% payout ratio, resulting in a dividend yield of 7.9%. With close to 90 mn HKD of net cash on the balance sheet, the stock trades an even cheaper ex-cash at 4.5x FY22 PE. </p>
<h3></h3>
<p>The only major near-term risk we see is the resurfacing of Covid restrictions on dine-ins. </p>

We received a positive profit alert for H1 2022 for Taste Gourmet Group Ltd (8371 HK), as expected in our last insight, Taste Gourmet: Conviction Growing As Execution Remains Solid,  the numbers based on the profit alert though are below our expectations which we largely believe is due to higher employee and food costs (we will get more clarity on this when the results are fully published on the 12th of November 2021). We calculate the H1 FY22 profits based on the alert released at 24 mn HKD (vs. our expectation of around 27 mn HKD).
We believe that the company is still on track to hit a 60 mn HKD profit number for FY22, putting it at 6.5x FY22 PE. We also believe that the management will adhere to a 50% payout ratio, resulting in a dividend yield of 7.9%. With close to 90 mn HKD of net cash on the balance sheet, the stock trades an even cheaper ex-cash at 4.5x FY22 PE. 

The only major near-term risk we see is the resurfacing of Covid restrictions on dine-ins. 

Taste Gourmet: Positive Profit Alert for H1 2022

<p>We believe that <a href="https://www.smartkarma.com/entities/taste-gourmet-group-ltd" target="_blank" data-smartkarma-citation="entities:27339:1" rel="noopener">Taste Gourmet Group Ltd (8371 HK)</a> can deliver a stellar Q2 FY22/H1 FY22  if operations remain uninterrupted in Hong Kong. </p>
<ul>
<li>In Q1 FY22, the company delivered its highest quarterly revenue of 145 mn HKD ( Vs. its last highest of 103 mn in Q3 FY21), despite operation being interrupted for over 1.5 weeks in April. We believe that revenue can average over 160 mn HKD in Q2 FY22.</li>
<li>Profit margins for Q1 FY22 averaged 7.6% due to COVID interrupting operations in April, and the company also took the opportunity to refurbish 2 of its existing restaurants and rebrand its Vietnamese La'Taste brand. With its operations uninterrupted in Q2 FY22 net margins can trend up to 10% on the revenue of 160 mn HKD. </li>
</ul>
<p>We expect the company to deliver a profit alert for H1 FY2022. We believe that <a href="https://www.smartkarma.com/entities/taste-gourmet-group-ltd" target="_blank" data-smartkarma-citation="entities:27339:1" rel="noopener">Taste Gourmet Group Ltd (8371 HK)</a>  can deliver revenue above 300 mn HKD ( FY21 revenue 379 mn HKD ) and a profit of 28 mn HKD ( equivalent to FY21 profit) for H1 FY22.</p>
<p>The stock trades at an appealing multiple of 6.9x FY22 and 5.7x FY23. With increasing cash flows, we believe the company can increase its dividend payout ratio to 50%. We believe at this payout ratio, the dividend yield for FY22/FY23 equates to 7.2%/9.1%.</p>

We believe that Taste Gourmet Group Ltd (8371 HK) can deliver a stellar Q2 FY22/H1 FY22  if operations remain uninterrupted in Hong Kong. 

In Q1 FY22, the company delivered its highest quarterly revenue of 145 mn HKD ( Vs. its last highest of 103 mn in Q3 FY21), despite operation being interrupted for over 1.5 weeks in April. We believe that revenue can average over 160 mn HKD in Q2 FY22.
Profit margins for Q1 FY22 averaged 7.6% due to COVID interrupting operations in April, and the company also took the opportunity to refurbish 2 of its existing restaurants and rebrand its Vietnamese La'Taste brand. With its operations uninterrupted in Q2 FY22 net margins can trend up to 10% on the revenue of 160 mn HKD. 

We expect the company to deliver a profit alert for H1 FY2022. We believe that Taste Gourmet Group Ltd (8371 HK)  can deliver revenue above 300 mn HKD ( FY21 revenue 379 mn HKD ) and a profit of 28 mn HKD ( equivalent to FY21 profit) for H1 FY22.
The stock trades at an appealing multiple of 6.9x FY22 and 5.7x FY23. With increasing cash flows, we believe the company can increase its dividend payout ratio to 50%. We believe at this payout ratio, the dividend yield for FY22/FY23 equates to 7.2%/9.1%.

Taste Gourmet: Conviction Growing As Execution Remains Solid

Hong Kong

Taste Gourmet Group Limited operates as a holding company. The Company, through its subsidiaries, manages a chain of restaurants. Taste Gourmet Group serves clients worldwide.

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Taste Gourmet (8371 HK)

Smartkarma Corporate Webinar | Taste Gourmet: Reopening Play in Hong Kong

On 17 May, 5pm SGT, join our Corporate Webinar with Taste Gourmet CFO and Company Secretary, Gerald Yu, speaking to Smartkarma Analyst Sameer Taneja.

Smartkarma Research

Taste Gourmet: Multibagger Reopening Play

The relaxing of restrictions by Hong Kong makes Taste Gourmet Group Ltd (8371 HK) a great reopening play, trading at 8.8x FY22e/5.6x FY23e PE and a...

Sameer Taneja

The Week That Was in ASEAN@Smartkarma - Grab Expands, Alfamart, and Mapletree Mega-Merger

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

Angus Mackintosh

Taste Gourmet: Positive Profit Alert for H1 2022

Taste Gourmet is a small restaurant operator in Hong Kong trading at 6.5x FY22 PE with a 7.9% dividend yield and around 24% of its market...

Sameer Taneja

Taste Gourmet: Conviction Growing As Execution Remains Solid

Taste Gourmet trades at a multiple of 6.9x FY22 and 5.7x FY23. The company can increase its dividend payout ratio to 50%, implying a dividend yield...

Sameer Taneja

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