Consumer

• On 24 July, 3D Investment Partners proposed to privatise Tohokushinsha Film (2329 JP) through a tender offer at JPY600-650 per share. A special committee will evaluate the proposal. 
• 3D’s privatisation plan, in its current terms, is a non-starter as the price is low, and its activism campaign has so far been met with the Board’s scepticism.
• The possible scenarios are that a white knight emerges to buy 3D’s stake/launch a counteroffer, 3D bumps the offer price, or the Board introduces a more ambitious MTM plan.

• A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
• ECM developments: Sanil Electric (062040 KS) and Hyundai Motor India (1342Z IN) IPOs.
• Event-Driven developments: Fancl Corp (4921 JP), Furukawa Battery (6937 JP), Sun Corp (6736 JP), Canvest Environmental Protection Group (1381 HK), CPMC Holdings (906 HK), Greatview Aseptic Packaging (468 HK). 

• The high percentage of foreign ownership is a characteristic of companies that have improved capital profitability and increased valuations, which is effective for overseas investor engagement.
• If the system is revised to help collaborative engagement and the identification of substantial shareholders, some of the challenges will be eliminated for both investors and the company.
• To make the engagement more effective, investors should increase active funds and companies should decrease cross-shareholdings.

• Tesla remains a polarizing entity in the stock market, consistently capturing the imagination of investors with its bold vision and ambitious projects.
• The company’s latest earnings highlighted both its impressive achievements and notable challenges, leaving a mixed bag for potential investors, resulting in the stock going down.
• On the positive side, Tesla continues to lead the electric vehicle (EV) market with record revenues and promising advancements in autonomous driving technology.

• A double dose of StubWorld this week: both the implied stub for Amorepacific Group (002790 KS) and the simple ratio (Group/Amorepacific Corp (090430 KS)) are around lifetime low levels.
• Preceding my comments on Amorepacific are the current setup/unwind tables for Asia-Pacific Holdcos.
• These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation >20%.

• China’s National Team was steadily buying ETF’s during and after the Third Plenum.  Southbound Connect Flows continue to be positive during July.
• Smoore International Holdings (6969 HK) , Xinjiang Goldwind Science & Technology (2208 HK) and Hisense Home Appliances Group Co., Ltd. H (921 HK)  benefited from positive news sentiment this week.
• Chow Tai Fook Jewellery (1929 HK) and ASM Pacific Technology (522 HK) suffered on negative news, while Meituan (3690 HK) continued its pullback in concert with the retail food sector.

• We expect Meituan’s C2Q24 rev. and non-IFRS NI to be 0.7% and 12.3% higher than cons, driven by resilient catering demand and eased competition.
• We expect Meituan in-store OPM improve to 33%/35% in 2Q24/2H24 supported by increasing commission rate and cutting BD cost.
• We maintain the stock as BUY rating and raise TP by HK$4 to HK$160/share to factor in the better profitability.

• Netflix reported its financial performance for the second quarter, highlighting key metrics that provide insights into its current standing and future direction.
• The company reported earnings per share of $4.88, exceeding Wall Street’s expectation of $4.74.
• Revenue for the quarter stood at $9.56 billion, slightly above the anticipated $9.53 billion.

• The NIFTY Index defied gravity and kept rallying higher for the past 8 weeks. According to our models it’s massively OVERBOUGHT and has been so for a while.
• While many other Asian markets have pulled back decisively, the NIFTY is just going higher and higher.
• Assuming it has its own uncorrelated drivers, where would it be a BUY again, if it pulls back this coming week? Let’s discuss this in this WEEKLY insight.

• Omnicom recently presented its results for the second quarter of 2024, highlighting a mix of positive dynamics coupled with the challenges inherent in a complex operational landscape.
• One notable strength in the results is the recorded 5.2% organic growth, spearheaded by a formidable 6.3% growth in the U.S. market.
• This growth was primarily driven by robust performances in advertising, media, and experiential disciplines.

• Mattel, Inc. experienced a significant boost in its stock price after news surfaced that the private equity firm L Catterton had made a takeover bid for the toy manufacturing giant.
• This development has attracted the attention of investors and fueled discussions about potential changes in the toy industry’s landscape, especially in relation to its long-time rival, Hasbro.
• Let’s delve into Mattel’s business operations and explore the potential valuation it could achieve through this deal.

• We are reiterating our Buy rating and $22.50 price target and slightly raising our projections after Betterware registered below consensus 2Q24 results, but reiterated their 2024 guidance.
• Further, while we view the 2Q miss as driven by product shortages and shipping issues which are, in the near-term, somewhat out of management’s control, we believe there were more than enough key positives, from continued turn in orders and top line at Betterware Mexico, further double-digit gains at JAFRA Mexico, earlier than expected turn at JAFRA USA and the start of expansion into the United States, for us to remain positive on BWMX and, with a dividend yield of over 9% to reiterate or Buy rating and $22.50 price target.

• D.R. Horton’s third-quarter 2024 earnings reflect the company’s ability to navigate a complex market landscape impacted by inflation and raised mortgage interest rates.
• Despite headwinds, the company managed a 5% increase in earnings, with a consolidated pretax income growth of 1% to $1.8 billion that could appeal to potential investors seeking steady performance.
• A vital positive from the results lies in D.R. Horton’s proven record of cash generation, producing $972 million from homebuilding operations within the first nine months ended June 30.

• Domino’s Pizza presented their Q2 2024 earnings wherein several key developments were noted that provide both an encouraging and concerning insight for investors.
• Encouragingly, the Hungry for MORE strategy adopted by Domino’s seems to be generating positive results, as evidenced by the consecutive-quarter growth in US comp performance driven by profitable order count growth, positive order counts across its delivery and carryout businesses, as well as across all income cohorts.
• The company also reported an improvement in its international comps and consistent earnings in line with expectations.

• Since the release of 3Q24 (YE August) results on July 10, the share price of Saizeriya (7581 JP) is up nearly 10%, greatly outperforming Nikkei during the same time frame. 
• The 3Q24 results showed that Japan’s operating profit finally improved, while China remained solid. 
• The company is currently trading at 24x 2025E PE with strong earnings growth.

• In this insight, we take a look at the Potential ADDs/DELs for the BSE SENSEX, 100, and 200 indices in the December 2024 index rebal event.
• At present, 3 changes for the BSE 100 index and 7 changes for the BSE 200 index.
• The BSE 100 handling rules for names without futures and options (F&O) sometimes punish companies that have enjoyed good share price rallies and Zomato could get into such a trap.

• Sales rose 5.3% YoY to JPY318.9bn, driven by strong SI and IT infrastructure services; operating profit fell 3.9% YoY.
• FY12/24 sales forecast revised to JPY650.0bn (+6.6% YoY) due to Primagest acquisition and strong IT solutions performance.
• Segment forecasts: Consumer sales flat, Enterprise sales JPY236.2bn (+7% YoY), Professional sales JPY44.0bn (+9% YoY).

• We need to watch carefully to see whether cash flow will subsequently increase in the projects that the CB issuers have invested their proceeds in.
• Share prices of companies that announce equity financings, including CBs, usually decline. Besides the dilution, another aspect is the effect of the company’s announcement of the sale of its shares.
• In the case of CBs, the company should keep in mind that it sold the conversion rights of its shares for less than their actual call option value.

• GTX reported Q2 results missing our estimates as demand for turbochargers softened in quarter. The magnitude of the sales miss was amplified by deflationary cost pass throughs.  
• GTX was successful in maneuvering its cost structure at the beginning 2024 resulting in gross margin exceeding our estimate and adjusted EBITDA declining by a significantly smaller amount than sales. 
• We were already towards the low end of GTX’s previous guidance range anticipating uncertainty. Our adjustments to 2024 and 2025 adjusted EBITDA estimates are minimal.

• We are reiterating our Buy rating, projections and $3 price target for Vince after visiting stores in Long Island, Connecticut and New Jersey.
• We believe the company continues to roll out winning collections, with a focus on compelling hues (dark scarlet and blue waltz), new items (cargo pants, shrunken camisoles, silk hooded shirts and cardigan sweaters) and a deeper focus on key categories such as dresses.
• Further, we are also seeing continued newness and expansion in men’s, driven by jackets, button front shirts (in patterns and textures) and the beginnings of a colder weather focus on long sleeve items, including the return of the waffle shirt jacket.

• Shoppers Stop (SHOP IN) is a leading retailer in India specializing in fashion and beauty brands with 12 department stores, 7 premium home stores, and 87 specialty beauty outlets,
• SHOP has also launched its value retail format INTUNE in June 2023 generating excitement and interest around the same. 
• It seems SHOP is trying to play all cards of the retail game, i.e., premium, beauty, and value fast fashion, but so far has shown no signs of success.

• 3D Investment Partners, known to be activist-ish-y, purchased 18% of Tohokushinsha Film (2329 JP) in the 12 months to March 2024. They started a public activism campaign in February.
• The company has started down a better governance track, but now 3D has made a takeover proposal to Tohokushinsha, which will consider it under Special Committee.
• There are a couple of possible outcomes here which are interesting to consider. There are no other spoilers possible except those friendly to founders and management.

• BYD (1211 HK) shares had a breakout relative to the MSCI China index and showing good momentum during the low volume days of summer. 
• POWER ASSETS HOLDINGS (6 HK) has shown a breakout relative to MSCI Hong Kong with a defensive business and 5%+ dividend yield.
  
• WH GROUP (288 HK) has also shown a breakout relative to the MSCI Hong Kong after its announcement of the spinoff of Smithfield Foods in the US.
  

• Shinsung Tongsang shares rose 10% to 2,510 won today after it was announced that the tender offer failed. Basically, the tender offer failed because the tender offer price was too low. 
• Only 26% of the 31.664 million shares responded to the tender offer. Accordingly, the shareholding ratio of Chairman Yeom and his related parties increased from 77.98% to 83.88%. 
• Top Ten has benefited from executing its strategy well (such as employing Lee Na-Young in advertisements to grab customers from Uniqlo). Overall, we remain positive on Shinsung Tongsang.

• Amer Sports (AS US) raised around US$1.3bn in its US IPO in Feb 2024, after pricing its IPO below its initial range.
• Amer Sports is a sports and outdoor brands company making clothing and other sporting equipment for use in snow sports, running, climbing, baseball, american football, tennis and other sports.
• In this note, we talk about the upcoming lock-up expiry and deal dynamics.

• We are reiterating our Buy rating, $37 price target and projections for Guess?
• after visiting stores in Long Island and the Metropolitan New York City area.
• With the return of hot and humid weather, we believe Guess?

• Yeo Hiap Seng(YHS SP) , known for its Yeo’s brand of Asian/health drinks, trades near its 52-week low at SGD 0.55, despite having financial assets and cash worth SGD 0.44/share.
• With limited guidance on reinvestment/growth opportunities and management’s stance against returning cash to shareholders, the stock trades around dividend yield, now at 3.6%.
• Over the past decade, the stock has lost 75% of its value, and management must take decisive actions to enhance long-term shareholder value.

• We are reiterating our Buy rating, projections and $24 price target for JAKKS Pacific with the company announcing 2Q24 (June) results after the close on Wednesday.
• While we do not expect, nor have we projected, a strong 2Q, we do believe management will be upbeat on a number of key fronts, including: 1) Cleaning up inventory levels in anticipation of Holiday strength and new launches; 2) gearing up for more normalized Halloween costume demand; 3) initial launches for The Simpsons lines to key domestic and international retailers; 4) progress on the international expansion front; 5) the initial shipments for the Authentic Brands partnership and 6) potential demand for Moana 2 and Sonic the Hedgehog 3 Holiday movies.
• Further, we expect the balance sheet has remained debt free, cash rich and management will provide an update on potential return to shareholders.

• Today after the close, Canon Marketing Japan (8060 JP) announced a large Tender Offer Buyback from its parent company Canon Inc (7751 JP). Canon will tender 20mm shares (15.42%). 
• This is a very capital efficient way to conduct a buyback from a parent, and an even better way for a parent to sell shares of a sub. 
• This corporate action will reduce equity by 20%, and partially clean up the messy inter-company transactions which should not exist. 

• Today after the close, Advantage Partners announced the intention to launch a TOB to take over Furukawa Battery (6937 JP) at ¥1,400 – a 26% premium to last.  
• This will require substantial time to obtain regulatory and foreign investment clearances so it is anticipated the Tender Offer will be launched at end-March 2025. I expect that is conservative.
• The price paid to minorities is a premium. But the price paid by the buyer is actually a takeunder. And it gets worse from there. 

• Furukawa Battery (6937 JP) recommended a pre-conditional tender offer from Advantage Partners, Tokyo Century Corp (8439 JP) and Furukawa Electric (5801 JP) consortium at JPY1,400, 22.6% premium to the undisturbed price.
• The precondition is approval under the competition laws of Japan and Thailand. The offer is long-dated and anticipated to commence in March 2025.
• While not a knockout bid, the required minority acceptance rate is not onerous. A long-dated offer presents a free option on a bump due to earnings upside or a counteroffer.

• True Wind has increased its partial offer for Sun Corp (6736 JP) by 8.0% to JPY4,750 and lowered the minimum number of shares to be purchased from 3.8 to 3.3m.
• True Wind’s offer has inadvertently spotlighted the valuation disparity vs the Cellebrite DI (CLBT US) stake, resulting in the shares trading through terms.
• True Wind’s revised offer will struggle to succeed as the 8% price uplift is materially lower than the 19% value increase in the Cellebrite stake (since the offer announcement).

• Garware Technical Fibres (GTFL IN) focuses on value-added products and has increased R&D investment significantly, with substantial growth in sports nets and geo-synthetics.
• The company’s strong export market presence, high-margin profile, and diversification will improve the margins in the future. 
• With refocus on the domestic market and growing demand for value-added products, Garware Technical Fibres (GTFL IN) is poised for significant growth with capex coming online.

• The CSRC has approved Midea Group Co Ltd A (000333 CH)‘s application to issue H-shares to be listed on the HKEX (388 HK). 
• Under the approval, Midea Group Co Ltd A (000333 CH) can issue up to 650.85m shares. Depending on the H-share discount, that could raise up to HK$43.6bn (US$5.6bn).
• The IPO is likely to be smaller and will depend on market conditions and the discount demanded on the H-shares. That in turn will determine index inclusion for the H-shares.

• Trent Ltd (TRENT IN) is a leading retail company in India known for its diverse range of fashion and lifestyle brands like Westside and Zudio. 
• With its own labels, operating efficiencies, and leverage at work, Trent has been able to expand its margins substantially. 
• We anticipate the strong operational performance to continue. We believe it will take a couple of years for peers to catch up to Trent’s execution prowess.

• The removal of their cross-holding structure has had a negligible effect on the respective discounts to NAV for Prosus NV (PRX NA) and Naspers (NPN SJ).
• We have seen a remarkable turnaround in Prosus’s operating performance during FY2024 and the market will focus on whether the new CEO can achieve his ambitions for “profitable growth”.
• The open-ended share repurchase program will continue as long as the discount remains “elevated”.

• Few companies file their annual securities reports prior to AGM, and since they are filed 1-2 days prior to AGM, there’s insufficient time for a thorough review of useful information.
• Profitable companies that gain the support of overseas investors further increase their return on capital through engagement, and the gap between them and those that don’t will continue to widen.
• Since reducing policy shareholdings will reduce the percentage of voting rights that unconditionally favor company proposals, engagement will be more effective and speed up the process of management improvement.

• Hyundai Motor (005385 KS) is looking to raise around US$3bn via listing its India unit, Hyundai Motor India. HMI is a wholly owned subsidiary of the Hyundai Motor Group.
• HMI primarily manufactures and sells four-wheeler passenger vehicles and parts. Currently its vehicle portfolio includes 13 passenger vehicle models across sedans, hatchbacks, SUVs and battery EVs.
• In our previous notes, we have looked at the company’s past performance and undertaken a peer comparison. In this note, we talk about valuations.

• Leon’s is a Canadian retailer of furniture and appliances that is majority-owned by the Leon’s family.
• The company has a history of delivering high returns on net tangible capital and compounding earnings per share at a steady rate.
• Leon’s holds a significant amount of undervalued real estate assets on their books, and has expressed intentions to monetize these assets through sale or development to potentially create value for the company.

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.

• Since the US$1.4 billion secondary placement announcement, ASICS Corp (7936 JP)’s shares are up 0.9% from the undisturbed price of JPY2,564 per share (12 July).
• Looking at recent large Japanese placements is instructive to understand the potential trading pattern. So far, Asics’ shares have deviated from the pattern of previous large placements.
• The offering will likely be priced on 23 July. Investors who have participated in previous large Japanese placements tend to secure positive returns.

• Kirin Holdings (2503 JP)’s JPY8,620 offer for Fancl Corp (4921 JP) closes on 29 July. The shares have traded above terms for 25 out of the 26 trading days.
• MY.Alpha Management has amassed 10.3 million shares (8.51% ownership ratio) with several purchases above terms. MY.Alpha could catalyse other shareholders to rally against a light offer. 
• The emergence of MY.Alpha, the high volume above terms, peers re-rating, the required minority acceptance rate, and an offer unattractive to historical trading ranges increase the probability of a bump. 

• Today, the final day of the Tender Offer that True Wind Capital launched on 10 June 2024 to buy 19% of Sun Corp (6736 JP), TWC raised its price to ¥4,750/share./
• They also lowered their minimum from 3.7934mm shares (17.0%) to 3.3472mm shares (15.0%).
• As Cellebrite DI (CLBT US) had traded higher, SunCorp had too, and even though shares fell today, they are at ¥4,785/share.

• The Hong Kong market trades about 30% below analysts’ estimated 12 month target price.
• Analysts are raising forecasts forXiaomi Corp (1810 HK) as it meets success with new phone rollouts and its EV business. 
• Sunny Optical Technology Group (2382 HK) had a positive profit alert and Minth Group Ltd (425 HK) is showing growth in its international business. Both are rated BUY from analysts.

• General merchandise retailer Warehouse Group Limited (WHS NZ) (TWG) has announced it has received an approach from Stephen Tindall and PE outfit, Adamantem Capital Partners
• Founder and major shareholder Tindall holds a shade over 50%. He launched a $1.6bn privatisation attempt in 2006, but Foodstuffs and Woolworths Ltd (WOW AU) effectively blocked the Offer.
• The approach arrives after TWG’s shares trade around multi-year lows. 

• Trent Ltd (TRENT IN) and Bharat Electronics (BHE IN) are shoo-ins to replace LTIMindtree (LTIM IN) and Divi’s Laboratories (DIVI IN) in the NIFTY Index (NIFTY INDEX) in September.
• Passive NIFTY Index trackers will need to trade at least 3.3x ADV and 7.7x delivery volume on the stocks. There is some opposite flow from Nifty Next 50 Index trackers.
• Cumulative excess volume has increased in all stocks but there are some stocks where there will still be more positioning over the next few weeks.

• Woori Bank completed a block deal sale of 11 million shares of Kumho Tire Co (073240 KS) (3.83% of outstanding shares) on 18 July. 
• After the recent sales by Woori Bank and the Export-Import Bank of Korea, the creditors’ stakes in Kumho Tire has been reduced to 19.17%.
• Despite Kumho Tire’s recent improvement in financial performance, we are more concerned about the additional stake sale by the financial institutions that still own 19.2% stake in the company. 

• Thai Beverage will offload its entire stake in Frasers Property Ltd to TCC Assets in a share swap for an increased share in Fraser And Neave streamlining its business focus.
• The share swap values Fraser And Neave on a par with peers which is at a significant premium to the share price but Fraser And Neave was excessively undervalued.
• Thai Beverage deserves to trade on a higher multiple given its pure-play status and a succession of recent restructurings including Serm Suk and Oishi Holdings. 

• Bloks Group (1850960D CH) is looking to raise US$300m in its upcoming Hong Kong IPO.
• Bloks Groups (Bloks) operates in the toy segment where it primarily assembles character and brick-based toys.
• In this note, we will talk about the positive aspects of the deal.

• Bloks Group (1850960D CH) is looking to raise US$300m in its upcoming Hong Kong IPO.
• Bloks Groups (Bloks) operates in the toy segment where it primarily assembles character and brick-based toys.
• In this note, we will talk about the not so positive aspects of the deal.

• Discounts likely set for a re-rating as market continues to overreact to appointment of CEO amid good set of results.
• The discounts of both Naspers and Prosus have continued to widen since the appointment of Fabricio Bloisi to Group CEO was announced in May (effective 10 July).
• At the end of June, the group released its strongest set of results in years, delivering on consolidated ecommerce profitability ahead of target.

• A group of shareholders aims to raise around US$1.3bn via selling around 11% of ASICS Corp (7936 JP).
• In our earlier note, we talked about the placement and ran the deal through our ECM framework.
• In this note, we talk about the updates and share price performance since then.

• Aequitas Research’s weekly update on the IPOs, placements, lockup expiry and other ECM linked events that were covered by the team over the past week.
• On the IPO front, the coming week  to see two more listing, with both likely to do well.
• On the placement front, Japan continued to dominate the ECM flows, with India, Taiwan and Australia joining in.

• Blue Moon started with a kitchen spray cleanser in 1994, but now focuses on liquid detergents in China
• While they have strong marketing and scale, their competitive advantages are weak compared to domestic competitor Liby
• Intensifying competition and various factors have led to a decline in Blue Moon’s market share, raising uncertainty about their future in the 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.

• Alimentation Couche-Tard is a global leader in convenience stores and gas stations, with a stable and recession-resistant business model.
• The company has a strong management team focused on consolidating the fragmented c-store industry and generating solid free cash flow.
• ATD stock is trading at a reasonable multiple with potential for mid-teens FCF per share growth, making it an attractive long-term investment opportunity.

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.

• The fact that institutional investors consider whether a company has zero female board members when voting has led to decrease in the number of companies with zero female board members.
• Since fewer companies have zero female board members but a minority of companies have at least two female board members, achieving 30% female board members seems somewhat of a hurdle.
• While tenure and concurrent service of female board members are problematic, the starting point is to ensure that women have  a 30% voice on the board and to promote diversity.

• News show that European car makers such as BMW is moving out of China, leaving the Auto market to the local players
• Stocks like Brilliance China will suffer losses as they lose some of the most famous co-brand.
• Foreign firm exits may give relief to local auto makers as it resolves part of the over-capacity problems

• Welcome to Consumer Tales & Trends, your weekly roundup of the latest corporate developments, investment reports and sector events in the consumer industry.
• Thai Beverage (THBEV SP)‘s proposed swap deal with promoter company raises several questions for shareholders. Start with the back story about how Fraser And Neave (FNN SP) joined the group.
• Bigger weddings could become a trend in India – Read why we like Kalyan Jewellers(KALYANKJ IN) . Also, household debt in Thailand as % of GDP is highest in ASEAN.

• I tally 49 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
• Three new deals discussed this week on Smartkarma: Samson Holding (531 HK)‘s Scheme, and VTOs for Advanced Info Service (ADVANC TB) and Thaicom Pcl (THCOM TB).
• Key updates took place on Capitol Health (CAJ AU), Alumina (AWC AU), Ansarada (AND AU), TCM (570 HK), CPMC  (906 HK), Fancl (4921 JP),and Hollysys Automation Technologies (HOLI US).

• Business is struggling due to legacy luxury brands such as BMW losing its positioning in China. Local brands are eating into market share fast. 
• Thankfully, the company is cash rich and its trading nature enables steady supply of dividends and have been known to pay special dividends.  
• Share price has been under pressure, now trading at ~15% dividend yield based on 50% payout,  appealing to yield seekers. 

• Share price under pressure due to industry challenges and transition of new product line-ups.  
• 2024 is a blip, things will normalise 2025 and deliver strong topline and bottomline growth. 
• LiAuto is trading at bargain levels for a company delivering 3-year earnings CAGR of 38%, net cash balance sheet and churns high free cash flow. 

• Most brands under control (Mercedes, Lexus, Toyota) are undergoing popularity downtrend by consumers in China.  
• There will remain a loyal niche supporter base, every legacy auto does, but it also means Zhongsheng will be a smaller and niche distributor going forward. 
• Share price has plunged significantly YTD, trading at only ~5x, which we think is overdone. Yield hunters will like its ~8% DY. 

• Thai Beverage(THBEVSP)‘s  proposed swap deal involves acquiring a 41.3% stake in F&N from promoters, seemingly at book value than fair market value, expected in case of an arms length transaction.
• Fraser And Neave (FNN SP)  holds a 20.3% stake in Vietnam Dairy(VNM VN), Vietnam’s leading dairy player, which is now trading at nearly a 40% discount to the investment value.
• Understanding TCC Assets’ ownership history of F&N may help clarify the deal’s valuation rationale.

• We spoke with multiple channels covering 3Ws, 2Ws, and 4Ws to understand the current dynamics of the Electric Vehicle (EV) scene in India.
• Adoption of E-3 and E-4 Wheelers is hindered by high prices, range issues, inadequate charging infrastructure, and platform stability concerns.
• E-2 Wheelers show resilience with stable sales led by aggressive pricing from Ola Electric (1700674D IN). 

• Early 6/18 pulled June sales into May, leading to disappointing June NBS data. Combined, online retail grew 5.1% yoy in May/June, and 6.4% yoy in 2Q24. 
• PDD remained the top shelf-ecommerce platform with GMV growing ~20%, followed by Taobao/Tmall (TTG) at ~6-7%, and JD and VIPS at ~2-3% yoy. 
• We expect JD and BABA to report slight earnings beats and guide upbeat on continued profitability improvement in 2H24. 

• High ratio of female non-regular workers and low ratio of women in management positions are factors behind the gender wage gap. Government expects to correct the gap in individual companies.
• Companies should improve making it easier for employees returning jobs after temporary leave for childcare/childbirth, and treating them in the same position they were before leaving after temporary leave.
• In order for women to have access to higher education and for women to work without leaving the workforce temporarily, the values that endorse gender inequality must be removed.

• The ¥500bn Offering of Honda shares is now priced (¥1,664.5/share) making it ¥497.46bn. Bookbuilding for retail – 80% of the book – is now. The price today closed at ¥1,665/share. 
• The Offering has follow-on “non-discretionary” demand which is non-negligible. It is worth understanding the amounts and timing.
• The lockups and non-discretionary demand, along with Honda’s relative cheapness as a large cap OEM and likely upcoming offerings on competitors means it has support.

• Thai Beverage(THBEV SP)  has proposed a share swap-deal with a promoter company to acquire additional stake in FraserAnd Neave(FNN SP)  in exchange for Frasers Property at negotiated valuations, not market prices.
• Post-Completion of the swap deal with the promoter-owned entity, which requires shareholder approval, Thai Bev will hold a 69.6% stake in F&N and no stake in Fraser Property (FPL).
• If the stake swap were valued at yesterday’s closing share prices, it would imply a drop in the total stake value for Thai Bev after the proposed deal.

• S&P revised MELI’s credit rating outlook to positive from stable and affirmed its BB+ issuer credit rating.
• MELI’s credit metrics are considerably stronger than its peers in the high-yield rating category
• MELI’s bonds have arguably already been trading at the investment grade level, supported by the company’s solid credit metrics for the rating category.

• We are reiterating our Buy rating and projections and raising our price target to $20 (from $17) after meeting with Lands’ End management at their headquarters in Dodgeville, Wisconsin.
• We believe management is laser focused on continuing to drive higher overall returns to the company, from shifting the product mix, lowering inventories, realizing higher pricing, focusing on features and stories to drive deeper customer interaction and loyalty, deepening licensing penetration on non-core categories, expanding internationally and driving stronger results at the Outfitters segment.
• The emphasis on leveraging the highly trusted Lands’ End moniker to maximize brand equity, drive higher returns and create an even more compelling lifestyle story is still in the early stages and, we believe, will drive multi-period growth.

• Author may buy or sell securities related to discussed issuer without informing readers
• Information presented is believed to be accurate but not guaranteed in terms of accuracy or completeness
• Author’s views are opinion-based and subject to change at any time; readers advised to do their own research and not base investment decisions on the note

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 are reiterating our Buy rating, $22.50 price targe and projections for Betterware de Mexico with the company reporting 2Q24 (June) results after the close on Thursday.
• We believe, while the Betterware division may be a drag (due primarily to foreign exchange), JAFRA continued to shine and the expansion into the United States has slowly begun to gain momentum at both Betterware and JAFRA.
• Further, we expect management to remain positive over key trends and for the company to once again reiterate overall guidance for 2024.

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.

• Anton Oilfield
• Health And Happiness (H&H)
• Vedanta Resources

• We analyze the audited annual report of Perfect Medical Health (1830 HK) released on the 16th of July. We also analyzed the company’s FY24 presentation. 
• The key takeaway is that the company will endeavor to improve its efficiency by cross-selling more services through Beauty Supermarket and expanding the sleep therapy business with Goku.
• Trading at a 12.5% dividend yield with 17% of its market cap in cash and >50% ROEs, the business is solid and worth exploring as an investment.