Equity Bottom-Up

• Rorze exceeds expectations in FY2/24 with a 6% revenue beat and an 11% surpass in operating profit, setting a record-high revenue of 28 billion yen in 4Q FY2/24.
• FY2/25 revenue guidance of 120 billion yen marks a 12% beat against analyst estimates, with operating profit expected to hit 32 billion yen, outperforming expectations by 10%.
• Rorze’s stock, though no longer deeply undervalued, remains reasonably priced at 16.5x NTM EBIT, indicating strong potential for earnings growth-driven future upside.

• We believe the criticism against Nongfu Spring will eventually help the company.
• Catching the trend of sugar free, tea revenue surged by 83% in 2023.
• The company achieved higher growth and higher margin, but its stock price is still flat.

• NetEase will be Activision Blizzard’s agency in China again after a divorce more than a year ago.
• Alibaba’s cloud service plans to reduce its overseas price offers by 23% on average.
• Infant formula companies, such as Feihe and Ausnutria, suffered from revenue shrinkage in 2023.

• On April 9, J&T disclosed operating stats from Q124 — a positive surprise
• We welcome the disclosure, but J&T should also explain X-border’s demise
• We believe J&T’s China operation remains far less profitable than its peers’

• Sea Limited is a gaming and e-commerce company in Southeast Asia that has experienced fluctuations in its stock price but has strong underlying business performance.
• Founded in 2009 as Garena by CEO Forrest Li, the company rebranded to Sea Ltd in 2017 and gained access to a wide range of games through Tencent’s investment in 2010.
• After achieving profitability in 2023, Sea Ltd is now focused on accelerating growth and drawing comparisons to Amazon’s early years.

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• We look at Asia, and see where there are interesting trade idea.  While HK/CH see investors’ capitulation, there are some interesting ideas in Singapore
• We focus on real estate and look at S-REITs, which just wrap up their 4Q 23 results.  We see divergence in terms of industry fundamentals
• Within S-REITs, we like industrial and retail given stronger industry fundamentals and stable asset valuation

• Travelsky Technology Ltd H (696 HK) Jan-Feb operational data strong, volume processed by domestic +45% YoY and international by +52% YoY; much higher than the consensus 2024 forecast of 15%  
• Traffic among the Big 3 Chinese airlines was up 46% YoY (-9% MoM) in March to +8% vs 2019. Domestic traffic rose 19% YoY (-11% MoM) to +24% vs 2019
• TP of HKD9.92 (+8% UPSIDE) is based on 2024 PE 14.8x (1SD below mean). The upside is uncompelling, but we advocate a HOLD as traffic growth is stronger than consensus   

• Sam Goi continues to boost his stakes in PSC and GSH INSTITUTIONS were net sellers of Singapore stocks over the four trading sessions from Apr 5 to 11, with S$44 million of net institutional outflow, as 21 primary-listed companies conducted buybacks with a total consideration of S$25 million.
• He acquired 144,700 shares of the company at S$0.352 per share, taking his total interest from 30.74 per cent to 30.77 per cent.
• Goi also bought more shares of GSH Corporation, where he also serves as executive chairman.

• Vinfast (VFS US) is large on promise but low on delivery, with sales in FY2023 coming in well below expectations, and the vast majority being to related companies. 
• The company is building huge capacity in Vietnam, India, and Indonesia in the region, and in the US, where sales have been slow but where capex is required.
• Vingroup has set up ride-hailing company GSM, using Vinfast vehicles for its fleet, making up 50% of its sales in 2023, leaving question marks over the sustainability of its model.

• Eubiologics (206650 KS) received UNICEF oral cholera vaccine order of KRW124B in 2024. This is nearly 1.9x higher than last year’s sales, making the case for record-high sales in 2024.
• Eubiologics is not expecting any near-term competition. The company is boosting its production capability to 90M doses annually by 2025 from 33M doses currently.
• Eubiologics is planning to enter the premium vaccine market, which should further accelerate the revenue growth and improve its margins. Recently, Bionote (377740 KS) has increased stake in Eubiologics.

• Following the positive response to our article on Perfect Medical , we are keen to introduce our readers to another noteworthy company in the healthcare and beauty industry, Water Oasis.
• Despite initial appearances suggesting sluggish revenue growth over the past decade, a deeper examination reveals significant improvements in business quality and consistent shareholder returns through substantial dividends.
• This under-the-radar company, we believe, presents an attractive risk-reward profile.

• With HK/China continue to see risk-off sentiment; we switch our focus to Japan.  Nikkei is up 19% YTD, one of the best performing markets in the world
• Among Japan real estate names, Mitsui Fudosan is a well held name with the largest market cap.  8801 is up 45% YTD while 8802 is up 57% YTD
• Valuation is un-demanding, it is an interesting name to own if investors want exposure to Japan.  It is still not too late to chase the rally

• Money Forward reported Q1 results. Net sales rose 40% YoY to 9.5 billion yen
• Money Forward saw a big jump in profitability, which puts the company on track to meet full year guidance
• The stock has risen around 30% since January. We still see around 7% upside to our target valuation 

• Latest Nanya Tech results showed weak margin rebound. Gross margin rebounded but remained below zero.
• Nanya expects DRAM pricing improvement through 2024E; due to demand for AI related memory products reducing capacity for other DRAM products rather than improvement for Nanya’s main Consumer segment.
• Micron is reportedly increasing prices post Taiwan earthquake and this is positive, but we see Nanya’s 2024E consensus margin expectations set at a high bar and the stock isn’t cheap.

• In 2023, CanSino Biologics (688185 CH) generated revenue of RMB561.7 million from the sales of meningococcal conjugate vaccines, up 266% YoY.
• This year, consensus is expecting CanSino to report revenue of RMB858 million, up whopping 140% YoY, mainly driven by meningococcal vaccines.
• CanSino is expected to add pneumococcal conjugate vaccine (PCV13) vaccine in its revenue stream in 2025. The company’s PCV13i is a potential best-in-class improved PCV13.

• Orient Overseas International (316 HK) saw 27.2% QoQ freight rate uptick in 1Q24. This is a positive start and we should not be too concerned about the 12% YoY decline.
• Its overall load factor also expanded 0.9pp YoY in the quarter, and this is the first YoY improvement since 2Q22. A better utilisation level is good for unit costs.
• At end-FY23, net cash equals 62.4% of the share price, dragging ROE to 7.5% for the next three years. But with such solid financials, its 0.7x P/B is not expensive.

• China plans to issue ultra long-term special treasury bond (about RMB1 trillion) to promote large-scale medical equipment renewal, which is expected to boost domestic demand in medical device sector. 
• Various regions (e.g. Beijing, Hainan, Guangzhou, Zhuhai) have issued separate supporting policies for innovative drug industry. It may be too early to completely lose hope of Chinese innovative drugs.
• There is “horizontal competition” issue between Taiji and Shanghai Shyndec Pharmaceutical (600420 CH), which is the underlying logic for potential spin-offs and integrations within Taiji and China TCM before 2025.

• Masked by a high base, 4Q FY24 sales of Sa Sa International Hldgs (178 HK) edged down by 4.1% YoY. However, sales for mainland China have increased by 18.2%.
• Overall sales for FY24 are in line with market projections and there is potential for further margin expansion. Its 6.7x and 5.9x PERs for FY25F and FY26F are inexpensive.
• The addition of more mainland cities to the Hong Kong individual visit scheme, promotion of Hong Kong tourism, and weaker USD in the medium term are all positive factors.

• Golden Throat Holdings is a gem. It has excellent fundamentals including an eye-catching dividend yield (17.9% in 2023) and a blistering DPS growth (10x from 2020 to 2023). 
• It also benefits from a compelling long-term theme (relieving sore throats caused by worsening air quality/smog/fine dust problems along with recurrent regular cold/flu symptoms among millions of people in China). 
• Golden Throat Holdings is one of the leading throat lozenges manufacturers in China. Its net margin averaged 24% from 2019 to 2023.

• Nanya’s quarterly revenue was NT$ 9.5 billion, up 9.2% QoQ & up 47.9% YoY
• Nanya still had a net loss of NT$1.2 billion, its sixth loss making quarter in a row
• Larger peers doubling down on HBM, structural reduction in memory wafer capacity & shortages likely triggered by Taiwan earthquake are all mounting tailwinds for Nanya

• While most HK/China stocks continue to be traded at depressed valuation, we view ESR as an interesting play among most real estate stocks
• The investment highlights of ESR are: 1) as a leading fund manager with growing AUM and fee income 2) leader in new economy sector, and 3) APAC focused
• ESR’s EBIT mainly comes from 3 segments: investment, fund management and new economy development.  ESR is now trading at deep discount to NAV

VietNam Holding (VNH) posted a solid net asset value (NAV) per share total return (TR) in 2023 of 15.8% (22.4% in US dollar terms), outperforming the Vietnam All Share index (VNAS), which posted an 11.7% return, and its direct peers. The investment manager remains confident that 2024 will be strong for Vietnamese equities, underpinned by average 20% y-o-y expected earnings per share (EPS) growth. VNH recently introduced a share redemption facility (on top of regular share buybacks), which allows shareholders to redeem their shares at NAV each September. We believe that this has contributed to the recent narrowing of VNH’s share discount to NAV to 3.0% compared to its three-year average of 14.1%.

• The Keepers Holdings (KEEPR PM) demonstrated a 5-year CAGR of 16%/25% revenue/profit growth with an ROE averaging 20%.
• FY23 surpassed our expectations with 17%/30% revenue and net profit growth. 4Q 2023 high season revenue and profit growth was an astounding 21%/75% YoY.
• The stocks trades at 6.9x/6.2x PE FY23/FY24e with a 7.5% dividend yield (assuming ten centavos/dividend based on FY23 earnings for FY24 and a 50% payout ratio). 

• Mitra Adiperkasa (MAPI IJ) has revealed more detail on the impact of boycotts stemming from the Gaza conflict on some of its brands, most notably Starbucks but also including Zara. 
• Management remains upbeat about the outlook for the expansion of new retail outlets across its brand portfolio in Indonesia and Southeast Asia but has reduced guidance for Starbucks. 
• Mitra Adiperkasa remains the best proxy for Indonesian retail with any weakness in the share price an opportunity, with valuations remaining attractive. 

• We explore Citibank’s upcoming division of CitiBanamex and the forthcoming legacy Banamex IPO; given the market’s premium PBV ratios, this should support the Banamex IPO valuation
• Sector trends to January show continued loan growth, but headwinds are building; rising funding costs are eroding credit spreads and credit costs are worsening, even though NPL coverage is healthy
• BanBajio generates an ROE of 28%+, whilst highly capitalized and on more modest multiples than Banorte; we stay cautious on Banorte, due to the growing risks to returns and valuation

• Sinopharm Group Co Ltd H (1099 HK) reported YoY and sequential growth in revenue and net profit in 4Q23. However, outlook for the sector remains bleak in near-term.
• Last year, Sinopharm’s distribution business was impacted by anti-corruption campaign. The momentum of the campaign continues in this year also. This lowers conviction toward improving performance in 1H24 at least.
• Despite of mid-single digit revenue growth, Sinopharm’s margin remains stagnant or is declining. Sinopharm still earns more than 70% revenue from low margin earning pharmaceutical distribution business.

• Nitto Kogyo Corporation (Nitto Kogyo) is a leading manufacturer of distribution boards and panel boards for electrical and telecommunications infrastructure, as well as enclosures that house telecommunications and precision equipment.
• The company has 45 sales offices and nine factories in Japan, including the new Seto Plant, which will begin operating in spring, 2024, and is working to expand its business in ASEAN countries, with overseas production and sales bases in China, Thailand, and Singapore.
• In the renewable energy field, the company is focusing on EMS-related businesses such as solar power generation systems, EV recharging stations, and self-contained industrial solar power storage battery systems.

• The Supply/ Demand imbalance in tankers will persist for longer, supporting earnings
• A beneficiary of increased global tensions and higher oil and gas prices
• Proposed Stock option scheme incentives management in the right way

FY24 trading underpins Norcros’s compelling investment case, where its new product development initiatives, market positioning and self-help initiatives allow it to take market share in both the UK and South Africa. We believe that Norcros’s key strengths are underappreciated and that legacy issues have been resolved. Its rating is low at 5.6x FY24e P/E, which is attractive, especially when compared to its yield of 5.7% on its well-covered dividend. We retain our estimates and value the shares at 246p, implying c 40% upside.

EML Payments has entered into an agreement to settle all the outstanding deferred consideration payments relating to the acquisition of Prepaid Financial Services Group (PFS) for £15.0m/A$28.8m, which represents a £7.9m/A$15.2m discount to the originally agreed amount. This agreement concludes all outstanding actual and potential liabilities relating to the PFS acquisition in 2020. Combined with the agreed sale of Sentenial for A$54m, this substantially strengthens EML’s balance sheet and simplifies the group’s structure.

• ETU’s land package remains one of the largest (681km2) and most prospective in Ontario, sitting in a top mining jurisdiction in the world spanning 80km along the Porcupine-Destor Fault hosting >100Moz Au.
• The Company has laid out its 2024 exploration plans, highlighting a new focus to high-grade gold showings along the eastern extent of the Hawkins zone – a high probability target for resource growth.
• ETU remains to be one of the cheapest stocks and hosts one of the largest land packages amongst junior explorers.

Lowland Investment Company’s (LWI’s) unconstrained, multi-cap investment policy differentiates it from most peers in the AIC UK Equity Income sector. It offers investors broad market exposure, outside of the large, traditional ‘income stocks’ at a 13% discount to NAV. The underperformance of small- and mid-cap companies versus larger peers has slowed and a turnaround would be very positive for LWI. Portfolio returns are already benefiting from acquisition activity, spurred by low valuations, and LWI has been outperforming its benchmark for the past 18 months. Meanwhile, quarterly DPS is running at 4.9% above the previous year, an annualised rate of 6.4p, reflecting a prospective yield of 5.3%.

• We expect Alibaba to report CY1Q24 top-line, non-GAAP EBITA and non-GAAP net income in-line, (14.2%) and (7.4%) vs. consensus. We cut non-GAAP EBITA by 10% and kept topline unchanged;
• BABA is prioritizing growth of both AliCloud and cross-border ecommerce (AliExpress), which will weaken profitability in the near-term but is the right thing to do. 
• BABA is transforming itself into Chinese Microsoft with hopes of e-commerce mainly pinned on overseas. We maintain BUY and US$ 85 TP, implying 9.5x CY24 P/E.

• Fast Retail missed analyst estimates for Q2 sales and operating profit. Revenue growth slowed to 5% YoY
• Full year operating profit guidance maintained at Y450 billion, just slightly below the street 
• The stock is trading at 27x EV/EBIT, in-line with historical averages, but still expensive in absolute terms and versus global peers

• Despite YTD strengths in share price, Cosco Shipping Energy Transportation Co. Ltd. (H) (1138 HK) is still cheap at 5.7x PER and 0.9x P/B.
• VLCC is forecast to stay undersupplied in FY24 and FY25, supporting the rates and CSET’s profitability. YTD, the VLCC rates have recovered by 19.5%.
• LNG transportation generated 19% of FY23 earnings. With 40 more vessels on order, compared with a current fleet of 43, there is immense upside from this segment.

• Builders FirstSource focuses on value-added and specialty products
• Maintains industry-leading gross margins of 35%
• Expands reach and solidifies position through strategic acquisitions and strong customer base

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

There has been a lot going on under M&C Saatchi’s operational bonnet, so delivering FY23 results a shade above market forecasts is a good result, especially given the difficult market backdrop. Earlier issues regarding outstanding put option liabilities are in retreat, with minority interests in FY23 down to 13% from 25% in FY22, and most remaining liabilities are expected to be settled in FY24. The focus is now firmly on optimising the operational structure. There has already been good progress, simplifying and achieving greater coherence on a regional-first approach, with better alignment to how clients (and potential clients) want to utilise the group’s global capabilities. The incoming CEO, Zaid Al-Qassab, who starts in May, should be taking on the group’s navigation in less stormy waters.

• Sixt is focused on increasing its market share and expanding into key markets such as Germany and Europe
• The company’s strategy includes focusing on premium vehicles, strong relationships with OEMs, and utilizing franchise operations for global expansion
• The Sixt family’s involvement and significant ownership stake indicate a commitment to the company’s success and continuity in leadership

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• ADF Group reported Q4 & FY24 financial results this morning that beat our expectations across the board.
• For Q4, revenue came in at $88.4M (+72% YoY) vs. our estimate of $77.1M and EBITDA came in at $15.5M (+164% YoY) vs. our estimate of $13.6M.
• FY24 marked another stellar year for ADF as it benefits from infrastructure spending across North America and the automation capex program at its Terrebonne facility.

• Chesnara has announced its 2023 results.
• Positive returns from equity markets and gains from acquisitions in the first half were somewhat offset by adverse changes to operating assumptions in the second.
• Economic Value profit of £59.1m marked a good turnaround from a loss of £85.1m in 2022.

• WIA Gold is an ASX-listed gold exploration junior with a JORC compliant Resource of 1.3m ozs at its Kokoseb project in Namibia
• WIA controls tenements adjacent to Osino Resources’ Eureka project and is in close proximity to Osino’s merger with Dundee Precious Metals (DPM)
• The company recently raised A$11m to accelerate exploration at its projects in Namibia and Cote d’Ivoire, with plans for production at Kokoseb in less than 4 years, potentially resulting in a quick return on investment for WIA shareholders through collaboration with DPM.

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• Market gaining confidence in DSGR’s management and growth strategy for potential multiple expansion
• Strong acquisition pipeline and track record of successful integrations positioning DSGR for long-term success
• DSGR offers an attractive investment opportunity with potential for significant upside due to recent developments and discounted valuation

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

For our next Corporate Webinar we are glad to welcome Elite Commercial REIT’s CEO, Mr Joshua Liaw.

In the upcoming webinar, Joshua will share a short company presentation after which, he will engage in a fireside chat with Smartkarma Insight Provider, Sumeet Singh. 

Sumeet will also be providing an industry overview, featuring landscape commentary and returns analysis. The Corporate Webinar will include a live Q&A session.

In the spirit of giving back to our community, one of the attendees will also be awarded an Amazon Kindle as part of our exclusive lucky draw. 

The Corporate Webinar will be hosted on Monday, 15 April 2024, 19:00 SGT.

About Elite Commercial REIT

Elite Commercial REIT (“Elite REIT”) is a Singapore real estate investment trust established with the investment strategy of principally investing, directly or indirectly, in commercial real-estate related assets in the United Kingdom (“UK”). Elite REIT is the only UK REIT listed in Pound sterling on the Singapore Exchange.

Elite REIT’s portfolio (“Portfolio”) comprises predominantly freehold properties strategically located mainly in town centres, and near amenities and transportation nodes. The Portfolio offers a stable government-backed income stream with over 99% of the gross rental income derived from the UK Government, backed by AA-rated sovereign credit strength. The leases are on triple net basis and Elite REIT is one of the largest providers of critical social infrastructure to the Department for Work and Pensions (“DWP”) and other UK Government departments. The DWP is the UK’s largest public service department that is responsible for welfare, pensions and child maintenance policy, serving over 20 million claimants and customers. The Portfolio is part of the crucial social infrastructure through which the DWP provides services to local communities.

• TSMC snags $6.6 billion in US CHIPS Act funding, along with loans up to $5 billion and tax credits up to 25% on eligible capital expenditures
• TSMC has committed to building a third fab in Arizona, scheduled to begin operations around 2030
• TSMC’s reiteration of their world class CAGR, Gross Margin & ROE numbers shines a light on Intel’s vastly inferior performance outlook.

• Amvis Holdings Inc (7071 JP) opened 57 facilities during FY20–23, which raised total borrowings 37% YoY to ¥17B in FY23 and further to ¥19B at the end of Q1FY24.
• The impact of the monetary policy is expected to be immaterial based on the current interest incidence of just 0.44%. Interest expenses account for less than 1% of revenue.
• Amvis started FY24 on a solid note, with all key parameters reporting more than 30% YoY growth in Q1FY24. The company has reiterated full-year FY24 guidance.

• The first quarter is seasonally the softest for selling wireless routers. The expectations for NTGR are for the firm to generate positive free cash flow while revenue declines sequentially. 
• We are anticipating NTGR’s cash per share to reach approximately $12 for the March quarter and maintain a forecast of $14 per share by the end of 2024
• The price competition at the lower end remains unchanged and dependent on NTGR clearing out inventory ahead of the peak selling period in the second half of the year

• Shineway’s performance in 23H2 was disappointing, mainly due to the VBP of formula granules and anti-corruption campaign. Accordingly, TCM injection and TCM formula granule businesses had negative growth in 23Q4.
• As the NHSA has further lifted the reimbursement restrictions on Chinese medicine injections, Shineway’s injection business is expected to help “hedge against” the headwinds in TCM formula granule business.
• 24H1 growth is under pressure due to 23H1 high base. Growth in 24H2 would pick up.As long as TCM favorable policies remain, profit is expected to increase by 20%-30% annually.

• 1Q24 production was 21.9 mbbl/d in line with our expectations.
• Production at the end of March was ~23 mbbl/d.
• Net cash of US$193.6 mm (US$176.3 mm unrestricted) was high given that the company sold only 1.8 mmbbl in 1Q24 with inventory building-up ~0.21 mmbbl vs YE23 to 0.9 mmbbl.

• The farm-out transaction with Energean has now completed.
• Chariot has received the US$10 mm cash upfront payment and retains 30% of in the Lixus licence (where the Anchois project is located) and 37.5% of the Rissana licence, offshore Morocco.
• A rig contract has also been signed with Stena Drilling to drill the high impact Anchois-East appraisal and development well in 3Q24.

• TRX is focused on the development and commercialisation of two proprietary processing technologies for the repair of soft tissue (dCELL®) and bone (BioRinse®).
• It has a broad portfolio of products used in biosurgery, orthopaedics and dental markets.
• Investment in tissue processing, manufacturing capacity and strong commercial partners, together with its “4S” strategy, has generated six consecutive reporting periods of strong growth, with TRX turning EBITDA-positive in 2023.

• BQE will be reporting Q4 & 2023 financial results in ~2 weeks, we are expecting proportional revenue of $4.2M, gross margin of 45%, and adj. EBITDA of $0.6M (14% margin).
• Metals prices have been rising steadily over the last month with copper up 9%.
• BQE’s China JV has leverage to the copper price as it sells recovered metals.

Utilico Emerging Markets Trust’s (UEM’s) manager Charles Jillings, at specialist investor ICM, is very excited about the prospects for the trust’s investee companies. He believes that investors underappreciate the quality of these businesses and the teams that manage them. Jillings travels extensively, along with deputy portfolio managers Jacqueline Broers and Jonathan Groocock, meeting with current portfolio and other firms and relevant organisations in emerging markets. They report first hand that companies in the fund are performing very well, with robust top-line growth and cost reductions leading to higher margins. Because of the nature of UEM’s holdings in infrastructure and utility assets, the fund has a consistently low beta. Successful stock selection has led to the trust’s NAV outperformance versus the MSCI Emerging Markets Index over the last one, three, five and 10 years – most notably over the last three years. Since inception in 2005, UEM’s NAV total return compounded at 9.5% per year.

• TSMC (2330.TT; TSM.US): US$6.6bn from US CHIPS Act; the Earthquake Impact and the 2nd Japanese Fab. 
• Memory Monitor: Nanya’s Results to Provide Latest Color on DRAM Post Earthquake; Short Int Rising 
• UMC (2303.TT; UMC.US): Some Rush Orders Coming in and 2Q24F Could Post Positive QoQ. 

• Market momentum continues to be strong. As we head into earnings season, the momentum is likely to continue.
• Strong operational updates Info Edge India (INFOE IN); Aavas Financiers Ltd (AAVAS IN) & Sula Vineyards (SULA IN).  
• The overall market sentiment, represented by the average revisions across all sectors, is nearly flat, with a slight positive revision for FY1E at 0.02% and essentially stable for FY2E.

• Air China Ltd (H) (753 HK) had 15.4% interest-bearing debt denominated in USD, vs. 21.3% for China Southern Airlines (1055 HK), making it less exposed to Rmb depreciation. 
• Recovery of international traffic and routes will help to lower unit costs. Air China’s unit costs for FY23 were Rmb4.0445, whereas CSA’s were only Rmb3.2000.
• There is more upside for Air China’s load factor which was down 7.8pp YoY in FY23, compared with -4.7pp for CSA. 

• Unilever announced plans to separate its ice cream business into a separate publicly listed company (SpinCo), potentially via a spin-off transaction.
• Post separation, Unilever will focus on four core businesses: beauty and wellbeing, personal care, home care, and nutrition. The separation is expected to be completed by the end of 2025.
• The separation will allow Unilever to allocate capital and resources more efficiently towards higher growth categories with significant potential to scale.

• TAL Education Group (TAL) reported net revenues of USD 373.5 million for its third quarter fiscal year 2024, exhibiting an increase of 60.5% and 63.7% in U.S. dollar and RMB terms.
• Despite the impressive revenue growth, profitability remained a concern with non-GAAP loss from operations and non-GAAP net loss attributable to TAL amounting to USD 10.2 million and USD 1.9 million, respectively.
• Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology.

• On the surface, FY23/12 consolidated OP -68% YoY, profit ATOP -53%, and FY24/12 initial guidance for a profit ATOP net loss may appear to indicate a challenging earnings environment.
• However, closer examination reveals steady earnings improvement, and the new MTP through FY26/12 targets recouping major overseas growth investments.
• The table below shows sequential improvement in the amount change YoY for Group EBITDA, OP and profit ATOP every quarter, with profits at all 9 levels posting YoY gains in the 4Q.

• Given that it has already been 6 months since I first bought Card Factory and the stock is currently trading only slightly above my average purchase price, I decided to send you guys a short and sweet thesis on why I believe $CARD.L is an attractive opportunity.
• Card Factory is a greeting card and other “celebration essentials” retailer operating primarily in the UK.
• What is unique about the Northern Europeans, particularly the British, is their habit of buying greeting cards. It is ingrained in their culture

• Alpha Metallurgical Resources, a supplier of metallurgical products for the steel industry, closed its fourth quarter with adjusted EBITDA of $266 million and achieved over $1 billion in adjusted EBITDA for the year.
• This is the second consecutive year in which the company attained such a milestone despite facing considerable challenges during the year.
• Alpha highlighted the robustness of its management approach which included proactive identification of issues and proactive response plans that ensured minimal impact on performance.

• Masimo Corporation had a mixed Q4 and fiscal year 2023 earnings call, reporting both positive results and some challenges.
• The company generated over $2 billion in consolidated revenues, with healthcare revenues reaching $1.28 billion.
• In addition, Masimo saw strong growth in its hearables business and reported a record number of contract wins.

• Aster DM Healthcare Ltd (ASTERDM IN) completes a significant restructuring, separating its India and GCC operations, with a consortium led by Fajr Capital acquiring a 65% stake in Aster GCC. 
• The substantial cash consideration received provides financial flexibility for further investments, debt reduction, or strategic opportunities.
• Explore the implications of Aster’s restructuring on shareholder value, with a special dividend of INR 110 to INR 120 per share planned.

• Today, the U.S. Department of Commerce and TSMC Arizona have signed a non-binding preliminary memorandum of terms for US$6.6 billion in direct funding under the CHIPS and Science Act.
• We estimate the impact of the earthquake on April 3rd should result in a loss of within 0.5% in 2Q24F, which means it should not affect our 2Q24F revenue expectations.
• TSMC’s 1st Japan Fab is expected to commence pilot production in February, and the 2nd Fab is projected to begin production of N6/N7 in 2027F.

• Gland Pharma Ltd (GLAND IN) reported mid-single-digit revenue and EPS growth in its base business (ex-Cenexi) during 9M FY24. The company is confident to end FY24 on a high note.
• Gland Pharma starts FY25 on a strong note with gaining U.S. approval for eribulin mesylate injection, used for breast cancer that has spread to other parts of the body.
• Over the next 12–15 months, Gland Pharma is poised for enhanced geographical foot-print in Europe through Cenexi. The addressable CDMO business opportunity is estimated at €4B.

• Maxlinear has probably been among this semiconductor cycle’s worst companies, if not the worst.
• I think that it might be time to give them a fresh look.
• Maxlinear was founded in 2003 in Carlsbad, California, by eight engineers. Today, Kishore Seendripu (CEO/Chairmen) and Curtis Ling (CTO) are still founders and work at the company. Maxlinear is a fabless company focused on mixed-signal products in the semiconductor industry.

• DRAM producer Nanya Tech will report its 1Q24E results on April 10th.
• While Micron has said it is evaluating the impact of the Taiwan earthquake on its operations and has halted price discussions with clients, Nanya could provide latest DRAM outlook color.
• Short interest has spiked ahead of Nanya’s results; We note that the company has a large revenue and margin rebound it needs to deliver on to meet 2024E consensus.

• Our NAV valuation suggests implied market cap of 1 trillion won or NAV per share of 15,983 won which is 11% higher than current price.
• Orion Holdings has attractive dividend yields and payouts. The company’s dividend yield increased from 4.1% in 2021 to 4.6% in 2022 and 5.1% in 2023. 
• The recent phenomenal performance of the movie Exhuma has resulted in a long-awaited revived positive sentiment on Showbox (which is 57.5% owned by Orion Holdings). 

• Ace Hardware Indonesia (ACES IJ) results revealed a positive finish to 2023 and an optimistic outlook for 2024, with new store rollout and shorter promotion periods set to boost sales.
• ACES continues to roll out its new format stores and renovate existing stores with a positive result, with 20 stores expected to be renovated in 2024 and 15-20 new stores,
• The company has seen strong momentum in 2M2024 with +10% SSSG and remains confident about the outlook, with positive guidance for growth. Valuations remain attractive versus history. 

• Flowers Foods continued to show resilience in a challenging consumer environment in the fourth quarter and full year of 2023.
• The company’s brands gained unit and dollar share for the first time since Q1 2022.
• Dave’s Killer Bread was particularly noteworthy, reaching $1 billion in retail sales and growing unit volume by 10%.

• Freshpet Inc. delivered robust performance for the fiscal year 2023 and the fourth quarter, notching a significant growth in net sales and improving profitability.
• The management believes the pet food company reached an inflection point in its journey towards becoming a profitable business in the fresh/frozen segment of the pet food market.
• Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology.

• Interview discusses the offtake agreement and opportunity to expand beyond the current arrangement, the $20m capital raised and outlook for future funding needs, update on strategic equity/debt in the US and milestones to expect over the next six months.

• The biggest changes in 2023 medical insurance catalog are the lifting of payment restrictions on TCM injections, which would drive rapid sales growth in the hospital market this year.
• GLP-1s are not flawless, and patients will lose not only fat but also muscle during weight-loss process. Then, another noteworthy opportunity has emerged – reduce fat and increase muscle.
• In 2024, Sino Biopharm is expected to achieve single-digit revenue growth. Deficiencies in corporate governance are one reason why the market is reluctant to offer Sino Biopharm high valuation.

• We compile our selection of small and mid-cap names with our desired characteristics of high dividend yields, value, and margin of safety.
• Our top picks are Perfect Medical Health (1830 HK), Water Oasis (1161 HK), Taste Gourmet (8371 HK), Uchi Technologies (UCHI MK), and Ginebra San Miguel (GSMI PM).
• We recently added Dream International (1126 HK). Read: Dream International (1126 HK): Dream Valuation of 3.7x PE and 12% Div Yield, >40% of Mkt Cap In Cash 

• TSMC: +16.2%, Bounced Back to Historically Extreme Level, Consider Short
• UMC: -0.3% Discount, Flipped to Positive and Now Negative Again
• ASE: +15.3% Premium; Bounced Back to Extreme Highs, Short the Spread

• AAOI recommends investing in Nintendo ahead of the launch of the Switch 2 console cycle in mid to late 2024
• Analyst sees potential for multiple expansion, margin improvement, and continued monetization of intellectual property through theme parks and movies
• Bullish on Nintendo’s stock in absolute terms and relative to other companies in the video game and media sectors, predicting significant gains based on past launch cycles.

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• United Microelectronics Corp (2303 TT)‘s 2Q24F outlook is experiencing a slight upward now, possibly indicating a positive QoQ.  
• UMC’s notable contributors are showing a mixed outlook, and Novatek Microelectronics Corp (3034 TT) could be the most influencer.
• Attention should be paid to the 3Q24F outlook for any potential changes and a shift from a bearish view could positively impact the outlook, potentially signaling the end of downturn.  

• Fu Shou Yuan’s 2023 performance was indeed not good, with negative growth in 23H2.Shanghai alone has limited market capacity.No matter how strong it is, it cannot drive the national market.
• Fu Shou Yuan has encountered difficulties in external expansion and M&A, so it chooses to increase dividends. However, this means the Company may have to say goodbye to high growth.
• The founder’s “past bad record” and uncertain business outlook hinder the upward potential of valuation, which requires a high margin of safety.It’s better bought at low price to collect dividends.

• China Power International (2380 HK)‘s earnings should accelerate in FY24, and rebound in hydropower is a key driver. Hydropower generation surged 84.3% YoY in 2M24.
• The 9.3GW of capacity acquired in Oct will provide first full-year contribution in FY24. Better economics for coal-fired plants will add to profit momentum.
• The 6pp increase in dividend payout signals management’s positive view in the outlook, and the Chairman is explicitly confident in good FY24 profit growth. 

• In March 2024, BYD’s Sales volume increased by 46% YoY and Li Auto’s sales volume increased by 39% YoY.
• AliPay announced that foreigners’ consumption amount in China in March was ten times of last year.
• Facing stagnancy and competition, Alibaba’s Taobao removed service charges from its retailers.

• Sealed Air (SEE) is a disaster in motion: its entire business is facing extinction as customers move away from the thin-film plastics the company makes.
• Sealed Air’s e-Commerce business has collapsed as Amazon has moved away from the single-use plastics, formerly ever present in its packaging. 
• California just passed two recycling and labeling bills that we think will make Sealed Air’s products unlikely to be used in the State and possibly in the US as a whole.

• This last week was packed with deals, amendments, and merger breakups.
• A SPAC is set to merge with an electric utility firm, and a blank-cheque firm is taking a critical metals supply chain-focused firm.
• Also, Sam Altman’s SPAC surges as it nears a deal, and a SPAC terminates a merger with a hydrogen energy firm. Read on to find out the latest about all things SPACs. 

• The outlook for factory automation is improving with inventory clearance, the upturn in the semiconductor industry and an AI-enhanced response to the labor shortage.
• Yaskawa’s margins should continue to rise with renewed growth in Robotics, efficiency gains and an upgraded product line. 
• Valuation stretched at 30x EPS guidance for FY Feb-25, but current weakness looks like a long term buying opportunity.

• Acadia Healthcare delivered a robust financial performance for 2023, marked by a 12.2% annual revenue growth, 13.1% adjusted EBITDA growth, and 14.3% adjusted EPS growth compared to 2022.
• In the fourth quarter, its same-facility revenue rose by 10.3% on the back of rate improvements and patient day growth.
• Acadia also saw consistent improvement in its labor trends throughout 2023.

• The Boston Beer Company’s Fourth Quarter 2023 Earnings revealed an operational performance meeting the midpoint of their forecast, with depletions down by 6% for the year and gross margins achieving an improvement of 120 basis points.
• However, net loss for the quarter indicated challenges, standing at $18.1 million, or $1.49 per diluted share.
• Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology.

• Tenet Healthcare’s Q4 2023 earnings indicated a strong performance, with net operating revenues of $20.5 billion, and consolidated adjusted EBITDA of $3.54 billion, which translates into an attractive 17.2% adjusted EBITDA margin.
• The company has demonstrated its ability to maintain profitability while focusing on quality and innovation.
• Yet, some challenges were also mentioned during the earnings call.

• Examining the fourth quarter 2023 earnings for Dentsply Sirona reveals an investment thesis that emphasizes the company’s successful strategies, robust performance and rigorous financial discipline, alongside ambitious future business growth targets and consistent value creation for its stakeholders.
• Starting with the positives, Dentsply Sirona achieved over 2% organic sales growth for 2023, outperforming projections via growth in three of its four business segments.
• Notably, its orthodontic business experienced double-digit growth with both Byte and SureSmile.

• Chemed Corporation reported their fourth quarter 2023 earnings with continued improvement in their VITAS operational metrics, including a 7% increase in admissions over the prior year period and an average daily census of 1,918.
• This is an 11% increase in comparison to the prior year and suggests that a hiring and retention program initiated in 2022 to remedy any potential worker turnover and expand clinical workforce capacity has been successful in maintaining VITAS’ operational performance.
• Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology.

• In Q4 2023, Elanco Animal Health reported a 5% constant currency revenue growth, driven by innovations, the strength of the farm animal business, improved conditions in the European Pet Health retail market, and increased pricing.
• The strong performance in 2023 indicates that the company’s innovation, portfolio, and productivity strategy are working, leading to confidence in the potential success of future investments.
• Going into 2024, the company aims to focus on three priorities: sustained revenue growth, innovation, and improved cash conversion.

• Fresenius Medical Care’s Q4 2023 earnings highlighted the progress made against their strategic plan that was set out a year prior.
• The plan focused on significant structural, operational and cultural changes, with the operating model being transformed at the start of 2023.
• This allowed the company to introduce a new financial report with increased transparency, which reflected a commitment to their operational turnaround initiatives that aided organic growth in both segments and improved operational performance.

• Globus Medical, a leading musculoskeletal solutions provider, has reported record revenues of $1.569 billion for the full year 2023, marking a growth of 53% compared to the previous year.
• The strong performance includes four months of sales after its merger with NuVasive.
• This remarkable growth maintained the company’s industry-leading profitability, generating a record non-GAAP EPS of $2.32 and an adjusted EBITDA of 30%.

• Globus Medical, a leading musculoskeletal solutions provider, has reported record revenues of $1.569 billion for the full year 2023, marking a growth of 53% compared to the previous year.
• The strong performance includes four months of sales after its merger with NuVasive.
• This remarkable growth maintained the company’s industry-leading profitability, generating a record non-GAAP EPS of $2.32 and an adjusted EBITDA of 30%.