Equity Bottom-Up

• L’Occitane (973 HK) announced two solid moves this week:  1) Disposing the 70% stake in Grown Alchemist;
• And 2) granting additional call options to Sol de Janeiro CEO Heela Yang of up to 7%.
• The stock is trading at 19x FY25 PE (fiscal year ending March), up from just 14x six months ago.

• Intel launched a new segment reporting structure under which its newly created Foundry P&L allegedly racked up operating losses of ~$17 billion over the past three years
• The Foundry P&L is not expected to reach breakeven until the ’27/’28 timeframe
• Intel’s share price is down >10% in the two days since the new financial model was launched. 

• AKR Corporindo (AKRA IJ) booked an impressive finish to the year despite slower revenue growth from its trading & distribution business boosted by strong industrial plot sales at JIIPE.
• The company expects trading & industrial volumes to improve in 2024, with retail petroleum becoming more significant with JIIPE expected to see increasing recurrent utilities earnings starting in 2H2024. 
• AKR Corporindo has a strong pipeline of potential tenants for JIIPE and expects to expand its BP JV retail petrol stations by 40-50 this year. Valuations remain attractive.

• Kura Sushi US Weighting as of writing: 4% 5th April 2024 – Q2 FY24 Results On April 4th, Kura Sushi US reported earnings for the second quarter of FY24.
• Nothing major to report and similar themes to previous quarters so will keep this one short. The market valuation is astronomically stupid.
• Average unit volumes at Kura are $4.28 million and have improved significantly; up 22% since 2019.

• Cochlear Ltd (COH AU) shares rallied 30%+ over the last six months. Shares are trading at NTM P/E of 51.3x, versus other Australia-listed medical devices companies’ P/E of 23–32x.
• The underlying business strength depicted by strong financial performance and guidance raise, and superior product offerings justify the pricey valuation.
• Cochlear lifted FY24 net profit guidance to A$385–400M (+26–31% YoY) from A$355–375M. The company expects FY24 cochlear implant volume growth of 10–15% YoY.

• Gibraltar Industries’ Q4 2023 financial results presented a robust year-end performance.
• The company’s leadership positions were expanded, the quality of earnings improved, and strong cash flows were generated.
• Both Residential and Infrastructure perform strongly, and although the Renewable segment faced industry headwinds, it demonstrated excellent margin expansion.

• Jinxin Fertility Group Ltd., China’s largest private provider of in vitro fertility (IVF) services, is buying a stake in an Indonesian peer, venturing into Southeast Asia as demand in China declines with more couples opting not to have babies.
• Hong Kong-listed Jinxin Fertility has signed an equity investment deal to become a “significant shareholder” of PT Morula Indonesia, an IVF specialist affiliated with PT Bundamedik Tbk, a major women- and children-focused health care services group in Indonesia, according to a joint statement Monday.
• It did not specify how much capital Jinxin will invest.

• One of a basket of Hong Kong commodity stocks we like
• One off issues in 2023 which should reverse in 2024
• Can also be viewed as  a tangential play on India’s industrial growth

• Fragmented industry with growth opportunities
• Successful acquisitions and expansion
• Focus on customer service and reputation for excellence

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.

• BellRing Brands Inc. has reported the results from their first quarter ending fiscal year 2024.
• These results have come out better than the management’s expectations, with net sales increasing by 19% in comparison to the previous year.
• The company’s adjusted EBITDA also showed considerable growth, rising by 18%.

• Nidec faces challenges amid global EV sales decline, with shares and valuations reflecting market pessimism.
• Anticipated catalysts include forthcoming guidance, potential MTP reassessment, and a strategic acquisition opportunity.
• At 18x EBIT, Nidec looks a compelling play on secular themes of electrification, automation, and energy efficiency.

• ZhongAn Online P&C Insurance C (6060 HK) is benefiting from the cross-selling opportunities  generated through the eco-systems of Alibaba Group Holding (9988 HK) and Tencent (700 HK), its parent companies
• Largest solely online insurance company in China with Rmb 30B gross premiums written in 2023.
• Expertise and cross-selling from Ping An Insurance (H) (2318 HK) , another parent company with a jointly run auto insurance business.

• Nvidia CEO Jensen Huang has repeatedly emphasized that the data center is the new unit of compute.
• While this concept seemed straightforward at first, the deeper implications became clearer after Nvidia’s presentations at GTC and OFC 2024.
• I only recently grasped exactly what is happening, and a simple reframing of the underlying principles that drove Moore’s Law makes the entire picture clearer.

• On 4 April, Douzone Bizon (012510 KS) announced that it plans to become the fourth Internet bank in Korea. Following this news, Douzone Bizon’s share price increased by 21%. 
• If the company succeeds in receiving the license to operate an Internet bank, this could meaningfully impact the company’s long-term sales and profits. 
• If Douzone Bizone expands into the Internet banking services, it may need additional backing from strategic/financial partners including Bain Capital which has a 10.2% stake in Douzone Bizon. 

• In the third quarter of 2023, PGT Innovations displayed a strong financial performance despite operating in an unpredictable market environment.
• The company’s balanced exposure to new construction and repair and remodeling channels has enabled them to deliver consistent record sales and impressive profits over the year.
• By combining a continued focus on operational efficiency and productivity, PGT Innovations managed to achieve a total revenue of $400 million and an adjusted EBITDA of $78 million in the third quarter.

• After a solid FY23, Anta Sports Products (2020 HK)‘s outlook for FY24 looks equally encouraging. Its various brands are expected to grow by 10-30% YoY still.  
• Listing of Amer Sports (AS US) will provide Rmb1.6bn non-recurring gain in 1H24. For the full year, there will be a positive swing in its profit contribution. 
• Anta Sports can be considered as a sportswear brand incubator, and its premium PERs of 18.3x and 15.9x for FY24 and FY25 reflect the ability to brew new brands. 

• Papa John’s International, Inc. reported another year of record global system-wide sales for the fourth consecutive year of positive North America comps in 2023.
• The company’s success is attributed to the dedication and focus of its team, franchisees, and the restructuring efforts, especially the foundation improvements to restaurant operations, menu amelioration with novel products, the digital advancements of their operations platforms, and the expansion of the restaurant footprint.
• 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.

• IAS 2023 fourth quarter and full year results depict a robust performance that exceeded expectations, noting an increase of 14% in quarter four revenue to reach $134.3 million and a year growth of 16% to reach $474.4 million.
• This growth marks a path for IAS’s strong commitment toward advancing the industry with its AI-driven measurement systems and optimization solutions.
• 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.

• Sai Gon Cargo Service (SCS VN) announced an increase in its pricing (details in note) effective April 1st, with a 10% increase across most categories. 
• March cargo numbers showed a substantial 47% YoY increase, as cooperation with Qatar Airways got underway in February. Q1 FY24 numbers were up 34% YoY.
• The stock trades at 12.5x FY24e numbers with an 8% yield, assuming a 20%YoY revenue and profit growth (and a 100% payout), with an upside to these conservative numbers.

• We believe consensus has not fully captured the company’s margin upside for FY24/25, likely due to management’s excessively conservative guidances.
• Our confidence is underpinned by positive SSSG trend, accelerating store expansion and clear trajectory for store margin improvement.
• We expect the company to generate RMB150/320 million adjusted net profit for FY24/25 respectively, compared to RMB30/150 million baked in consensus. Reiterate buy with HK$80 target price (30x FY25 earnings).  

• Q1 Deliveries trailed plunging market consensus, my even lower number, and Tesla’s expectations as sales crashed while it overproduced to a new record cumulative excess inventory which jumped 70% y/y
• This doesn’t square with Tesla’s explanation that sales were hurt by ongoing production issues—much like when the company used the same excuse for the disappointing Q3 2023. 
• This time deliveries were much lower, the miss versus market expectations much worse, and the deep well of unsold inventories even more formidable.

• Nongfu Spring (9633 HK) announced a set of strong 2023 results last week, with 2H23 net profit up 62% yoy and sales up 33% yoy. 
• The best performing category in 2023 has been tea beverage products (30% of sales), which grew 83% yoy for the year and 105% yoy in 2H23, picking up speed.
• Nongfu Spring is trading at 33x 2024 earnings, which I believe is attractive. 

• Oriental Watch (398 HK)  has begun Q4 2024 slowly, with its SSSG dropping by double-digit levels in all its major markets (HK/China and Macau).
• As the year almost draws to a close, we expect profits to drop 10-15% YoY for FY24 and the company to pay out 100%, resulting in a 14% dividend yield.
• The company also has 1.2 bn HKD of net cash, representing 70% of its market capitalization. Additionally, it has 700 mn HKD of investment property. 

• Hansoh Pharmaceutical Group (3692 HK) reported a whopping 55% YoY net profit growth to RMB3 billion on just 13% YoY revenue growth to RMB6 billion in 2H23.
• Revenue from innovative drugs zoomed 52% YoY to RMB4 billion and its proportion to total revenue increased to 73% in 2H23 from 54% in 2H22 and 62% in 1H23.
• Although Hansoh is not expected to receive marketing approval for any in-house innovative product in 2024, existing portfolio of innovative drugs will continue to drive the growth of the company.

• Century Communities has reported its Q4 and Full-Year 2023 results, which demonstrated notable growth and profitability.
• The company’s Q4 deliveries hit a record high of 3,157 homes, reflecting a 9% year-on-year increase, and the year 2023 marked the firm’s 21st consecutive year of profitability.
• The housing market also witnessed considerable improvement, contributing to the company’s success.

• D.R. Horton is a leading homebuilder with high returns on equity and strong balance sheets, yet trades at a low price-to-earnings ratio.
• The company has shifted to being asset-light, generating significant free cash flow and maintaining a strong balance sheet.
• With a focus on market share expansion and efficiency, D.R. Horton is positioned as a growth company in a stable industry.

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.

• Life Time Group Holdings, Inc.’s Q4 2023 earnings call emphasized impressive financial performance and strategic growth plans.
• The revenue increased by 18.2% in Q4, driven by a rise of 20.9% in membership dues and enrollment fees, and an 11% increase in in-center revenue.
• Access memberships increased by 5.2%, ending the year with over 763,000 memberships, while average monthly dues stood at $183, a rise of 13.2% from the previous year.

• Pendragon sells UK car dealer and leasing businesses to Lithia Motors, leaving behind dealer management software segment Pinewood Technologies
• Dividend payout from sale proceeds leaves Pinewood with around 20 million GBP of net cash
• With Lithia Motors owning shares and potential for growth through software rollout, there is significant upside potential in Pinewood’s valuation at a low multiple of 8x TTM EBITDA

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.

• Shake Shack Inc. delivered an impressive 2023 full year, marking transformative milestones and exhibiting substantial profitable growth.
• Key metrics indicate a steady growth of 24% year-over-year in the company’s system-wide sales, reaching a record $1.7 billion.
• The company launched 85 total restaurants (an unprecedented number in a single year) and ended 2023 with 518 Shake Shacks worldwide.

• Carnival Corporation plc recently released its Q1 2024 earnings.
• The company’s CEO, Josh Weinstein, and CFO, David Bernstein, detailed its financial performance.
• Despite recent disruptions caused by an event at the Francis Scott Key Bridge, which is expected to have a less than $10 million full-year impact, the company reported a strong first quarter.

• SK Square owns a 20.07% stake in SK Hynix which is now worth 27.2 trillion won. SK Square’s market cap is only 39% of SK Square’s stake in SK Hynix.
• SK Square has benefited from increased capital allocation to low P/B stocks in Korea due to the Corporate Value Up program. SK Square is trading at P/B of 0.7x. 
• Amid the tremendous demand for Nvidia’s AI related chips, this has also benefited several Korean companies including SK Hynix and SK Square. 

• Aster DM Healthcare Ltd (ASTERDM IN) shares took a beating as Olympus Capital offloaded ~49M shares at a price range of INR405.00–406.72 (~7% discount to the last close price).
• GCC business separation is expected to complete in Q4FY24. Aster DM plans to consider distributing 70–80% of the upfront consideration of $903M as dividend to its shareholders.
• Stake sale by Olympus Capital is not a warning sign for the company. Despite CGHS rate overhang, we think recent pullback in Aster DM share provides an attractive entry point.

• China Communications Construction (1800 HK) believes its FY24 new contracts and revenue growth can be faster than FY23, particularly fuelled by strategic new industries and overseas. 
• Its end-FY23 contract backlog of Rmb3.45trn (+1.8% YoY) translates into coverage of 4.1x of FY24F revenue, providing a secured stream of revenue over the next few years.
• Its improving cash flow allows for a 1pp increase in the payout ratio. Efforts in realising underlying asset value should narrow its 82% discount to book value.

• Midea Group Co Ltd A (000333 CH) posted strong 4Q23 results, with net profit up 18% yoy and sales up 10% yoy. 
• In terms of 2024 outlook, management targets a 5-10% yoy growth in both the top and bottom line. 
• The stock is has rerated up to 12x 2024E earnings, compared to an average of 13x over the last 10 years. 

• Our popular, text-only weekly is back, hopefully in an improved version, and aims to be more consistent throughout this financial year.
• The market structure and momentum seem to be positive. Upcoming earnings season and elections are likely to be key drivers going forward.
• Stocks discussed include Bajaj Finance Ltd (BAF IN), SBI Cards & Payment Services (SBICARD IN), Honasa Consumer (HONASA IN) and Delta Corp Ltd (DELTA IN) 

• TSMC Q2 2024 outlook is expected to increase by approximately 5% QoQ, with 2024 projected Capex to see a slight uptick. 
• Intel is expected to adopt TSMC N3B technology in 2Q24F, while we anticipate that MediaTek will transition to N3E by the end of 3Q24F.  
• Intel has received financial assistance of US$8 billion through the US Chips and Science Act, and TSMC is also projected to receive around US$5 billion.

• It is not only NPLs that we must worry about for banks, but also loans that can turn NPL amidst a worsening economic backdrop
• CBA’s past due loans but not impaired are up 43% in past two years and this bucket of loans is now 2.6x NPLs compared with 1.9x NPLs recently
• Australia shows surging insolvencies across many sectors through 17 March 2024 and this can mean past due loans are more prone to migrating to turn NPL

• The sBLA of Carvykti is under review by FDA with a target PDUFA date of April 5. If approved for 2L therapy, Carvykti would become “a game changer” in MM treatment.
• The peak sales of US$5 billion is becoming possible. From this perspective, as Carvykti advances towards earlier line treatment, the subsequent valuation leap of legend Bio is becoming more certain.
• However, considering lower gross margin and Legend Bio/J&J’s 50/50 split ratio, Legend Bio’s market value performance could be inferior to BeiGene. Investors should also closely monitor the changes in macro.

• Spirits were high as we attended the TCL Electronics (1070.HK ) (“TCL”) investor conference last Thursday (28 March) at the Shangri-La in Hong Kong, following its after-market earnings release.
• The results topped our own expectations in some areas, which we outlined in our recent write-up on the Company .
• We decided to summarize the results, as well as management insights shared at the conference for added context.

• We like Dream International (1126 HK), the plush toy maker listed in HK for its long-term association with Disney and revenue growth profile (12% CAGR over 15 years).
• The 15-year ROE has averaged 18%, and the company currently has 40% of the market capitalization (1.3 bn HKD) in net cash on the balance sheet. 
• Trading at 3.7x FY23 PE, with a 12% dividend yield (and the company’s high likelihood of maintaining a payout ratio), this is an idea worth exploring.

• In this insight, we discuss numerous gap trades involving Korean preferred and common shares in 2Q 2024.
• Although the discount on the preferred shares versus the common shares has been gradually narrowing in the past decade, this discount increased from end of 2021 to 1 April 2024.
• On a longer timeframe (3-4 years), we believe this discount could narrow further to the 20-25% range, which provides additional opportunities for the Korean preferred shares to further make gains.

• There is a rumor in social media that Tencent will dismiss 10% – 30% of its employees.
• Alibaba withdrew the IPO application of its subsidiary Cainiao and all the other IPOs were halted as well.
• Xiaomi began to sell its first vehicle model SU7, but it is too late for the company to enter the market.

• In this insight, we highlight the recent pricing gap divergences of the major Korean holdcos and opcos which could provide trading opportunities in 2Q 2024.
• Of the 38 pair trades, 26 of them involved holdcos outperforming opcos in the past six months, suggesting increased capital allocation to Korean holdcos relative to their opcos.  
• These pairs could generate trading opportunities in terms of their pricing gaps closing reversal. [CJ Corp vs CJ Cheiljedang & Hanjin KAL Corp vs Korean Air Lines].

• Shenzhen International (152 HK) saw its FY23 earnings reaccelerated, supported by gains from the logistics park transformation business. Earnings even surged 169.1% YoY in 2H23. 
• REIT issuance on two logistics assets, increase in areas of logistics projects, gains from South China Logistics Park transformation, and better Shenzhen Expressway (548 HK) will fuel FY24.
• A better debt structure will save finance costs. Its 0.45x P/B, or 1.5SD below the 5-year average, is cheap given its proven ability to realise underlying asset value.

• I recently had a conversation with a close friend and fellow investor, during which he shared his current research interest in the dollar store concept.
• He emphasized that this business model aligns with criteria conducive to long-term shareholder returns.
• Given the scarce presence of dollar stores in Germany, primarily due to socioeconomic factors, I sought clarification on the underlying concept from him.

• CSPC Pharmaceutical Group (1093 HK) reported steady growth in finished drugs in 2023. New products including Mingfule, Yilouda, and Anfulike achieved rapid sales ramp-up due to inclusion in the NRDL.
• The company expects to launch 50 innovative drugs in the next five years, which will provide continuous momentum. The company further aims for 17 common generic launches during 2024–2025.
• CSPC Pharmaceutical shares are trading at a P/E of 11.3x, lowest level seen in last five years, and cheaper than peers. Dividend yield remains attractive at 4%+.

• Tencent Music Entertainment Group (TME) posted robust results in its fourth quarter and full year 2023 earnings call.
• Increasing subscribers and expedited revenue growth were notable positives, taking the total number of subscribers to the 100 million milestone due to the company’s focus on content leadership, platform value, and offering a high-quality user experience.
• Yet, the company also faced some headwinds, particularly in the social entertainment business.

• This is our first report on Polestar.
• The company saw their highest-ever delivery volume for the Q3 2023 period.
• The said period witnessed record deliveries of 13,976 vehicles, representing a growth of 51% compared to the same period in the previous year.

• The utilization rate for Vanguard in 1Q24F is at a recent low of 50-53%, indicating that the utilization rate is expected to increase from 2Q24 onwards.  
• Vanguard should consider building a new 12″ Fab in Singapore, aligning with our potential acquisition of Taiwan Semiconductor (TSMC) – ADR (TSM US)’s 40nm and above business.
• In conclusion, the future outlook appears promising for the coming 3~4 years.  

• Dongfang Electric (1072 HK) reached another record year with net profit surging 24.2% in FY23. Favourable product mix has benefited gross margin which expanded 0.8pp YoY.
• Record new orders of Rmb86.5bn (+31.9% YoY) have been signed and there is a recovery in momentum in 4Q23. Its end-FY23 backlog should be enough to cover 3.1x FY24F revenue.
• DEC is well-positioned to capture the demand for hydrogen energy and power storage. With 19.3% 3-year earnings CAGR, its 5.1x PER and 8.2% dividend yield are attractive.

• TSMC: +11.8% Premium — Falling Closer to Its Historical Range
• ASE: +9.2% Premium; Further Breakdown Could Indicate Return to Previous Trading Range
• CHT: -1.8% Discount — Good Level to Long the Spread

• Mediatek is advancing full speed with recent industry collaborations for automotive chips, data center connectivity solutions, and AI memory solutions.
• In particular, the company has entered the market for Co-Packaged Optics (CPO), with partnerships announced with Foxconn and Ranovus.
• While the stock has rallied and re-rated, consensus forward estimates do not appear overly demanding and could still have room to increase further.

• Quanta surged with major server wins from Meta, Alphabet, and Amazon. Nanya Tech results are two weeks ahead and Intel will host a webinar this week about its Foundry business.
• Mediatek: Accelerating Momentum in Automotive, Data Center, and AI Memory Solutions 
• Hon Hai (Foxconn): After the 50% Surge, Where Can It Go From Here? 

• Chinese outbound travel demand continued to recover nicely in February
• Major airlines’ decision to slow capacity rebuild now looks very prudent
• But the airlines have underperformed, surprisingly; Buy Trip.com below US$43

• Centurion Corp (CENT SP) is the leading light in purpose workers’ accommodation in Singapore and Malaysia, with high occupancy rates and healthy rental reversions, with a long-term secular growth backdrop.
• The company is also involved in purpose-built student accommodation in centres of excellence for education including the UK, Australia, and the US in a highly sought-after asset space.
• The outlook for both worker and student accommodation looks positive for the coming two years. Valuations look attractive with Centurion Corp trading at a 56% discount to NAV.

• China announced game approval for the Feb batch. The number of games approved remained at a higher level than 2023.
• The pace of China game approval appears to have accelerated to the same level as pre-tightening.
• However, neither Tencent and Netease got any approval in March.

• Licensing-Out deals of Chinese pharmaceutical assets are indeed significant milestones, but we should not exaggerate its significance. The product strength itself/subsequent progress are the true sources of clinical benefits/commercial value.
• In the field of weight loss drugs, first-mover advantage may not be that obvious. The possibility of latecomers to disrupt first-mover would not be that low or time-consuming.
• For Aier, 23Q4 results could show an obvious rebound, leading to relatively high growth in 2023 full year. However, Aier’s problems are still there, which means Aier is not undervalued.

• Just a week after Nvidia’s GTC conference, Quanta has reportedly secured large orders for new Nvidia Blackwell-based servers from Google, Amazon AWS, and Meta. 
• Other firms showcasing Nvidia servers at GTC include Wiwynn, Gigabyte, Pegatron, Asus, Hon Hai (Ingrasys), Wistron, Dell, and Super Micro. There could be a higher probability of new order wins.
• Stock Focus: Asustek — Improving outlook as a play on both AI PCs and AI servers.

• The Italian Treasury sold an additional 12.5% stake in Banca Monte dei Paschi di Sien (BMPS IM), raising €650 million as part of re-privatization efforts following the 2021 failed attempt.
• The Treasury’s divestment makes BMPS more appealing for buyers. BMPS still trades at attractive valuation multiples. The bank announces approval from the ECB for a €0.25 cash dividend per share. 
• Economy Minister Giorgetti and PM Meloni aim to boost competition through privatization, favoring a merger with another mid-sized Italian bank, possibly BPER Banca or Banco BPM.

• Theoretically, there’s no need to doubt WuXi XDC’s growth momentum. What needs to be proven is how large the actual ADC market is, which determines how much valuation it deserves.
• However, the biggest problem currently is geopolitical risks, which make performance forecasts groundless. In the context of Sino-US confrontation, there is “a hesitation” towards sustained high growth of WuXi XDC.
• If several pieces of news are put together, this is not just about China CXO/TikTok being sanctioned by US. New balance point in the game between great powers will emerge.

• This report identifies stocks at the extremes of their positioning or momentum ranges within our Asia Ex-Japan fund universe.
• We have pinpointed eight stocks either at their historical positioning extremes or undergoing significant changes in fund ownership, providing detailed ownership profiles for each.
• Pinduoduo Inc and UltraTech Cement make gains, Sunny Optical sees ownership drift south, New Oriental Education moves off the lows.

• With the “Postcard” series, our objective is to bring to our readers on-ground insights based on interactions across key channels located in tier 2 and tier 3 locations.
• For this postcard, we travel to the magnificent and iconic city of Agra. 
• We were pleasantly surprised by the rapid pace of electrification among three-wheelers, which is the topic of this postcard.

• Ultrajaya Milk (ULTJ IJ) 4Q2023 and FY2023 confirmed a recovery on both its dairy and carton tea segments, with strong growth and a normalisation of raw material costs boosting margins.
• ULTJ continue to focus on new product launches in dairy and carton tea and growing its distribution network with its new distrbution centre at MM1200 under pilot testing.
• Prospects for FY2024 look healthy with expanding distribution and a number of new products helping to drive growth. Valuations look reasonable versus listed competitor Cisarua Mountain Dairy (CMRY IJ).  

• Atour reported C4Q23 revenue vs. our estimate/consensus by 18%/21% and guided a robust 30% yoy revenue growth for 2024, outpacing the consensus by 12% and our estimate by 7%
• C4Q23 operating margin decline was due to one-off leased hotel impairment and seasonality in retail marketing. We foresee stable margin in 2024;
• We maintain our BUY rating and keep our TP at US$37.5, implying a 2024 P/E of 34x, vs. currently trading at 16x.

• Mediatek Inc (2454 TT) Dimensity 9400 is expected to be released in September 2024F.  
• Artificial Intelligence (AI) is a trending topic, and MediaTek is adapting by emphasizing Generative AI functionality in its Dimensity 9300 and 9400 smartphone models.  
• The smartphone market is expected to recover in 2024F, with MediaTek’s revenue in the second quarter potentially surpassing the first quarter.

• This is our first report on Wendy’s Company.
• In Q4, Wendy’s global systemwide sales grew over 3%, supported by global same-restaurant sales growth and the benefit of global net unit growth.
• U.S. company-operated restaurant sales grew due to higher average check figures driven by cumulative pricing of around 4.5%.

• Mitra Adiperkasa (MAPI IJ) finished the year with strong sales growth of +17.4% YoY in 4Q2023 with solid growth across all segments and improving margins. 
• The company continues to add to its 150-strong brand portfolio in Indonesia, as well as extending its reach further in Southeast Asia and growing its omnichannel capabilities. 
• MAPI remains our top retail pick in Indonesia with its focus on the resilient upper-middle segment in Indonesia and increasing regional exposure. Valuations remain attractive at 12.5x FY2024E PER.

• Kawasan Industri Jababeka released a strong set of FY2023 results, with revenue growth of 20% overall and EBITDA increasing by +15% YoY due to higher land sales at Kendal.
• KIJA also saw strong recurrent revenue from its infrastructure pillar making up 44% of sales. Marketing sales came in above its target and it is projecting a higher 2024 number.,
• The company’s Kendal Estate is a key beneficiary of shifting supply chains from China with 81% of sales to foreign companies and marketing sales increasing 68% YoY in 2023. 

• Pinduoduo Holdings, Inc. closed its fiscal year of 2023 in a positive trajectory.
• The company reported sustained growth in consumer engagement on its platform in its fourth quarter results.
• High-quality development remains a key strategy for the company.

• Micron Technology’s Fiscal Second Quarter 2024 Earnings showcased a lean towards optimism with some cautionary notes.
• It was revealed that the Micron sees substantial demand for High Bandwidth Memory (HBM) which has even surpassed their expectations and as such the HBM supply for 2024 is already sold out, with most of 2025’s capacity also already allocated.
• This is due in part to the product’s high performance specs and 30% lower power consumption.

• FactSet Research Systems Inc., a multinational financial data and software company, posted a mixed result for its second fiscal quarter of 2024.
• Despite enduring difficult market conditions and an industry rife with uncertainties, FactSet revealed a year-over-year growth of 5.4% in organic ASV plus professional services.
• The quarter-end showed over 8,000 clients with 75 net new logos added.

• Taidoc Technology is an attractive small cap health care stock in Taiwan. It has a solid dividend yield, strong balance sheet, and stable profits and free cash flow.
• The company’s core business includes clinical equipment and professional instruments including diagnostic, telehealth, and blood sugar and blood pressure monitoring devices.
• We found Taidoc Technology using Smartkarma’s Smart Score Screener system. It has top ranks in the Value and Dividend categories. However, it has lower rankings in the remaining categories.

• According to the FedEx Corporation’s third quarter earnings report for the Fiscal Year 2024, profits continued to increase for the third successive quarter.
• This is attributed to the FedEx team’s prompt customer service and progress with transformation initiatives.
• Although revenues declined, operating income and profit margin showed growth—a dynamic the CEO attributed to FedEx’s transformation and its management prowess in controlling what is within its purview.

• Addressing selling activity by organizational change – Q1-2 FY7/24 results demonstrated double-digit sales growth of 41.5% YoY via underlying growth at the parent business and acquisitive impact from DICS Holdings.
• However, the overall pace of growth was lower than expected, with INTLOOP experiencing lower-than-planned productivity from newly hired sales representatives.
• The company has addressed this by implementing a new and reinforced organizational structure in H2 FY7/24 by recruiting senior management (partner and managing director class) to drive sales activities as well as customer acquisition and increasing overall market coverage. 

• Multi Bintang Indonesia (MLBI IJ) reported its FY23 earnings with revenues/profits up 6.7%/15% YoY.  Q4 FY23 revenues and profits were up 5.6%/17% YoY. 
• OPM (%) expanded 180 bps from 40.6% to 42.4%, and NPAT margins 240 bps to 32.1%. We believe that trends will continue to improve in 2024.
• At its board meeting, we expect the company to declare a full-year FY23 dividend of 500 Rph/share ( implying a 7% yield). The H123 dividend was 110 Rph/share.

• Hon Hai shares have hit a new all-time high and have just risen past our target price of NT$155, surging after investors flocked to Hon Hai on AI news.
• Hon Hai showcased two key technologies at Nvidia’s GTC conference last week: Nvidia-based AI servers with liquid cooling systems and an AI autonomous driving controller using Nvidia’s Orin X processor.
• Hon Hai’s sharp rally appears to have partly been caused by a short squeeze; While we like the long-term fundamentals and increased TP to NT$170, Hon Hai appears near-term overbought.

• There is a lot of excitement and uncertainty about the paint sector especially Asian Paints’ leadership in the broader market and among analysts.
• We interact with a couple of paint dealers across Delhi and Dimapur to gauge the sentiment on the ground.
• While there is no denying that Grasim Industries (GRASIM IN) poses a credible threat it might be too early to write off the market leader Asian Paints (APNT IN). 

• PT Nippon Indosari Corpindo (ROTI IJ) saw a relatively slow finish to the year with a slight decline in sales but the key drag came from a higher return rate.
• 4Q2023 did not see the usual seasonal spike but 2024 has started well and the return rate has come down, which will boost profitability as new products gain traction. 
• ROTI has launched several more affordable products to help drive its push into general trade whilst raw material prices remain under control. Valuations are attractive with recovery ahead.

• The electronic financial transactions industry is expanding, with a focus on personalization, the gig economy, and fraud prevention
• Mastercard is well positioned to benefit from the shift away from cash and towards digital payments
• Magellan’s portfolio manager Alyssa DeMarco discusses Mastercard’s growth and innovation with Devin Core, highlighting the company’s evolution over the past decade and its strategic focus on diversification and global expansion

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• Despite Rakuten Bank shares’ re-rating, we believe it remains attractive, with its strong balance sheet and its low cost base with undemanding valuations compared to its Asian digital banking peers
• Rakuten Bank is well positioned to benefit from the negative interest rate policy exit in Japan, with its low LDR, high cash balances, growing loan book and healthy capital ratio
• It continues to leverage off the Rakuten Group eco-system, as a low cost source of new customers; nearly a third of clients use Rakuten Bank as their primary Japanese bank

• Citic Securities, China’s leading brokerage, has shifted over 100 investment bankers from initial public offering (IPO) roles to other divisions, in a major overhaul to address slowing business amid the stock market downturn.
• Most of the employees affected were transferred to debt financing business while the rest were relocated to mergers and acquisitions, and investment departments, a person close to the matter said.
• “The adjustment is an internal optimization of personnel, involving a broad range of investment banking positions,” said the person.

• Genesys Intl Corp (GENE IN) or (GICL) is engaged in Geospatial services.
• The balance sheet of the company is surrounded by impairments; in the last few years, the company has impaired a major chunk of its intangibles, investments, goodwill and advances
• Other forensic insights include doubts on revenue recognition, struggle with the cash flows and earnings quality, recon issues and treatment of few line items

• Hywin [NASDAQ:  HYW] announced a broad business transformation plan in response to overall market and regulatory conditions in China.
• The stock price, under considerable pressure since November last year, has clearly anticipated some of this uncertainty.
• As part of its transformation, Hywin will shift is wealth management product distribution away from asset-backed products.

• Astera Labs, an overvalued fabless semiconductor company, has completed its IPO and raised ~$565M of net proceeds in the offering. The IPO was priced at $36/share.
• Astera Labs shares jumped 70%+ in their first trading day and finished session at $62.03. The stock peaked at $95.21 on Tuesday and fell ~21% over the next 2 days.
• According to their prospectus, ~5.9M shares of Astera Labs will be available for sale following the public release of earnings for 1Q’24, which I expect to be announced in April.

• While domestic revenues may have slowed, Uniqlo’s domestic OP shows upside potential driven by upside to GM and a gradual reduction in SG&A expenditure.
• Simultaneously, Uniqlo International is exhibiting strong performance, with anticipated revenue and OP growth of 21% and 30% YoY respectively.
• Despite expecting a strong earnings beat, concerns over high valuations and index issues make us cautious about trading Fast Retailing (9983 JP) in the current earnings cycle.

• MHI’s share price has risen more than 60% year-to-date and nearly tripled over the past 12 months on the improving outlook for Japanese defense contractors.
• A huge increase in new orders, prospects for a doubling of sales and a rapidly rising operating margin on Aircraft, Defense & Space have been factored into the price.
• The shares do not look expensive compared with international comparables, but neither are they particularly cheap. Potential problems, from Japanese defense budget constraints to production glitches, have been ignored. 

• The med-tech sector is ripe for consolidation. Smaller players like Hogy Medical (3593 JP) , and Eiken Chemical (4549 JP)  exhibit sub-par growth and lagging valuations
• Activist investors like ValueAct Capital, Dalton and Asset Value have recognized an opportunity for growth and potential M&A
• Both Hogy and Eiken trades at a deep discount to larger domestic peers and stand to benefit the most from any consolidation

• Discover SCILAL’s debut in the stock market after demerger form Shipping Corp Of India (SCI IN), its strategic disinvestment, and the hidden value within its diverse asset portfolio.
• Real Estate Assets in company and future outlook by management of SCILAL over the years going forward.
• The market value of assets is twice more than the book value. Value bet but can take longer time to monetize the same.

• Shenzhou Intl Group Holdings (2313 HK) reported 2023 results yesterday.  2H23 continued to be weak, with sales down 6% yoy.  Net profit grew 10% yoy in 2H23.
• Most importantly, the company sounded quite bullish on 2024 during the results briefing, which greatly improves the visibility in the order recovery thesis of the company.
• I continue to believe that Shenzhou is the best proxy for gaining exposure to the global sportswear sector, especially given the improved visibility now. 

• I mentioned Noah holdings as a trade to buy before earnings since I anticipated an announcement of significant capital returns.
• This has worked out well with over $2 in dividends announced. Half of that dividend will be recurring.
• So I sold out all of my shares at just under $12. This was never a high conviction investment, but merely a trade. Marking it as a 18% return.

• With around 3.4% QoQ CC revenue growth in Q3FY24, the BPO business, Firstsource Solutions (“Firstsource”), is recovering back to normal, after seeing cyclical dip over the past couple of years.
• The FMCG business is scaling up well. Q3FY24 revenues came in at INR 135cr, a growth of around 12% QoQ, led by festive season demand. YoY growth was 17%+.
• The Sports business reported muted revenues in Q3FY24 as currently the revenue stream is dominated by the IPL event which typically happens in the March to June period.

• Full -year 2023 results  and 2024 forecasts indicate business going to plan
• The Baijiu division, key to a rerating, grew sales 50% y/y in the first two months of the year
• The beer division continues to reap the benefits of its premiumisation strategy

• Abercrombie & Fitch Co.
• emerged from 2023 with significant achievements, marking it as a defining year for the company.
• The brand witnessed a 15.8% increase in sales, reaching $4.28 billion, which not only represents its second highest annual sales level in history but also a testament to its robust growth strategy.

• Symbotic is a warehouse automation technology leader and offers end-to-end AI-powered robotic and software platform for supply chains.
• SYM’s hi-tech platform forms its deep competitive moat underpinned by significant R&D spend of $800 million and 575 issued or pending patents.
• Our positive outlook for SYM is underpinned by its hi-tech platform , a large TAM, robust order backlog ($23.2B) and its JV deal with Softbank that opens a large market.