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In today’s briefing:
- Topsports (6110 HK): High Dividend Yield Supported By Strong Free Cash Flow
- CaiNiao Smart Logistics Pre-IPO Part 3 | Key Comps, Valuation Multiples | 310 Bn CNY Justifiable
- Gushengtang (2273.HK) – 2023 Full-Year Performance Would Exceed Expectations
- Morning Views Asia: Hopson Development
- Monthly Chinese Express Tracker | A New Price War Among China’s ‘Sort & Transport’ Express Names
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Topsports (6110 HK): High Dividend Yield Supported By Strong Free Cash Flow
- Topsports International Holdings (6110 HK) announced first half FY24 (fiscal year ending February) results last week, with net profit up 17% yoy.
- The company trades at a 7% dividend yield, backed by strong free cash flow.
- The stock is not only a yield play, but also a call option on the recovery of Nike and Adidas’ retail performance in China.
CaiNiao Smart Logistics Pre-IPO Part 3 | Key Comps, Valuation Multiples | 310 Bn CNY Justifiable
- In this insight we first consider which comparables are the most appropriate for CaiNiao
- We then discuss which valuation multiples make sense, plus some potential pitfalls
- We believe CaiNiao and their bankers could justify a valuation up to 310 bn CNY
Gushengtang (2273.HK) – 2023 Full-Year Performance Would Exceed Expectations
- 3Q23 is expected to achieve over 40% YoY growth. 2023 overall performance would be better than previous guidance- Revenue up 40+% YoY and adjusted net profit up about 45% YoY.
- With abundant cash flow, Gushengtang has increased dividend payouts and share buyback, indicating that the current stock price is undervalued and has not yet reflected its high growth expectations/healthy fundamentals.
- Gushengtang has cross-regional expansion capability. The “sustainability” + “high growth” of performance are worth noting. Depressed sentiment/complex external environment provide a good buying opportunity. Rebound in stock price is expected.
Morning Views Asia: Hopson Development
Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.
Monthly Chinese Express Tracker | A New Price War Among China’s ‘Sort & Transport’ Express Names
- In this month’s Tracker, we focus on a new price war among the ‘sort & transport’ names
- Q3 ASPs at these express companies fell by -12% Y/Y, and volume growth softened
- We believe margins are under increasing pressure in China’s mainstream express segment