Consumer

• Meituan reported C1Q24 revenue 6.0%/6.2% higher our estimate/consensus, and adjusted net income 19%/29% higher than our estimate/consensus. The stock fell on lower takeout order and in-store revenue guidance for C2Q24;
• The stock has two uncertainties:(1)Strategic moves by Douyin and Eleme,(2)success of overseas expansion. There are no easy answers to these two questions but we believe the corner has been turned
• We maintain the stock as BUY rating and raise TP to HK$156/share to factor in the improvement in profitability.

• A new tool highlights which TSE companies have disclosed a policy/consideration; sometimes referred to as the “name and shame” list. In practice, more “name” than “shame”. 
• Jardine Cycle & Carriage (JCNC SP) is trading rich to its NAV. And the simple ratio (JCNC/Astra International (ASII IJ)) is the highest level outside the 2008 GFC. 
• This is a rubbish Offer for Asia Cement China (743 HK). Given how shareholders voted at last year’s AGM, expect this Scheme to be voted down. Avoid.

• Fonterra Shareholders Fund’s dividend yield was 14.2% in 2023. Its dividend yield averaged 8.7% in the past three years. 
• Fonterra Co-Operative Group, is a New Zealand based multinational dairy cooperative. Outside investors who are not allowed to hold shares in Fonterra Co-Operative Group can invest in Fonterra Shareholders Fund. 
• In May 2024, Fonterra announced that it plans to sell off its consumer products businesses and concentrate on business to business sales as a dairy ingredients supplier.

• The first quarter fiscal 2025 earnings by Best Buy Co., Inc. demonstrated some mixed results.
• On the positive side, it highlighted that the company had better-than-expected Q1 profitability through strong execution and preparation for future growth.
• The company has been driving improvements in its priorities and its operational metrics.

• The Gap Inc. reported strong first quarter results, exceeding expectations across key metrics, with market share gains and positive comparable sales across all brands.
• The company’s first quarter performance reflected continued focus on its financial and operational priorities.
• Comparable sales for the company grew by 3%, with positive comps for all brands.

• Guess?, Inc.’s Q1 fiscal 2025 showed a strong start to the year, with significant progress on operational, strategic, and financial objectives.
• The company reported results for the first quarter exceeding expectations in revenues, operating earnings, and per share results.
• Sales growth was recorded in each of their segments and gross margins expanded favorably impacting the bottom line.

• BurgerFi International is currently examining a strategic decision involving the possible sale of the company.
• This review comes in the wake of their reported financial outcomes for the first quarter of 2024.
• Analyzing the financial data and strategic initiatives articulated during the earnings discussion can provide insights into the potential advantages and challenges related to such an acquisition.

• In its recent earnings, Burlington Stores reported revenues and earnings growth for the first quarter of 2024.
• Total sales grew by 11% compared to the same quarter in the previous year, driven by new store openings and comparable store sales growth.
• The company opened 14 new stores during the quarter, expanding the total count to 1,021 stores.

• Hormel Foods Corporation, a multinational manufacturer of food and meat products, delivered solid performance in the first half of the year, with consecutive quarters of better-than-expected earnings, a major improvement in operating cash flows, and strength in the food services segment.
• The company has seen a recovery in its international business, achieved stability in overall volumes, and made progress on its strategic initiatives aimed at propelling long-term growth and shareholder returns.
• The corporation, best known for its SPAM, Hormel, and Black Label foods, is on track to meet its three-year improvement targets.

• Kohl’s Corporation announced its first-quarter 2024 earnings, delivering results that fell short of the company’s expectations.
• The company faced a difficult comparison with last year’s profits due to last year’s elevated clearance activity, which generated a significant drag on comparative sales in Q1.
• While clearance is generally a headwind for the business, the level going into 2023 was described as unique and unlikely to be repeated.

• Even with the 9% increase in share repurchases, the high level of cash on hand will likely be further built up, given the increase in cash flow.
• Companies that have increased their valuations over the past year have further increased their valuations by growing their traditionally high valuations and ROE and ROA.
• Cash allocation is a major challenge for all companies. Many companies have a payout ratio of 30%, and they have too much cash on hand relative to sales.

• The latest earnings of Ulta Beauty show that in Q1 2024, the company reported a 3.5% rise in net sales to $2.7 billion, and 1.6% growth in comp sales.
• Also, the diluted earnings per share were $6.47.
• However, amid a rapidly shifting marketplace, the company has adjusted its expectations for the rest of the year.

• Last September, Toyota Motor (7203 JP) Group affiliate Aisin (7259 JP) said they would get rid of ALL their cross-holdings. That signalled a future sea change in Toyota intra-group relations.
• It meant all Toyota group companies could do that. The big moves started with a multi-party offering of Denso Corp (6902 JP) shares – Toyota, Toyota Industries, and Aisin sold.
• Then others. Then in March, Denso announced a 2.5yr selldown of ~¥460bn of Toyota Industries shares. That meant a TI buyback was likely. We got one. Now we have details.

• During the upcoming Dragon Boat Festival, both flight and railway traffic seems sluggish, indicating a cooled-down enthusiasm for long-distance trips due to budget constraints.
• Data points to booming short-distance travel with self-driving as the major means, helped by lower price;
• Benefiting from hotel booking and catering, Meituan is the biggest beneficiary of such consumption downgrade.

• Total revenue increased by 25% YoY and all business lines grew strongly.
• In 1Q24, the operating losses from new initiatives decreased by 45% YoY, but new initiatives revenue still grow.
• We conclude that the price target can be double of the market price.

• Water Oasis (1161 HK) reported profits down 30% YoY (ex-one-off profits down 9% YoY only), but commentary cited headwinds in the business due to muted HK economic sentiment.
• Anticipating these headwinds, the company cut its semi-annual dividend by 50% to only 3.5 cents (implying a 7% yield on the current share price) despite a massive cash buildup.
• Net cash at 396 mn HKD is now 58% of the market cap. Given the current economic backdrop, we see a conservative approach to dividend payment in the medium term. 

• Guzman Y Gomez plans to raise around US$160m in its Australian IPO.
• GYG is a quick service restaurant business with more than 200 restaurants globally. It mainly focuses on fresh, made-to-order, Mexican-inspired food.
• In this note, we look at the company’s prior performance and future prospects.

• After a strong 68% increase in share price in 2023, Saizeriya (7581 JP) has been trading range bound, and up 8% year-to-date in 2024. 
• Continued weakness in Japan on the profitability front in 1HFY24 offset continued strong performance in China.
• Japan’s operating profit is set to improve in the second half of the current fiscal year (ending August), and China’s strength will continue on the back of accelerating store openings. 

• On 5 June, Affinity Equity Partners (AEP) announced that it is seeking a delisting of Lock&Lock (115390 KS) shares through a comprehensive stock exchange. 
• It has been reported that the second tender offer failed. Only 1.5% of the outstanding shares participated in the second tender offer, falling short of the 9.5% participation required.
• Affinity plans to transfer the shares of Lock&Lock held by an overseas corporation to a domestic corporation (investment-in-kind) and then go through a comprehensive stock exchange procedure.

• With the review period complete, there are 3 stocks that are close to the deletion zone and could be removed from the index at the June rebalance.
• Even if there are no constituent changes, capping changes will lead to one-way turnover of 3.6% and a one-way trade of A$83m.
• There are 6 stocks with over A$5m to trade from passive trackers but the impact on the stocks is not very high.

• Guzman Y Gomez plans to raise around US$160m in its Australian IPO.
• GYG is a quick service restaurant business with more than 200 restaurants globally. It mainly focuses on fresh, made-to-order, Mexican-inspired food.
• In this note, we talk about the not-so-positive aspects of the deal.

• Lululemon was facing some really thorny questions from Mr. Market ever since 4Q’23 earnings. Today’s earnings should help calm some nerves.
• Here are my highlights from tonight’s call. Sales Growth by Region At first glance, one may find confirmation to plenty of concerns for LULU. US sales, which was ~61% of overall sales this quarter, grew by only 2%.
• Growth momentum in international markets, especially in China helped mask the weakness in the US.

• A high-ranking official from the local financial regulatory authority has confirmed to several local media outlets that the tax benefits for the value-up program will be unveiled this month.
• Corporate tax cuts and separate taxation on dividend income will be included. The short-term impact at the time of the announcement will likely be more significant for corporate tax cuts.
• Local market is focused on screening large companies within the KOSPI 200 that have substantial pre-tax profits in anticipation of the corporate tax cut momentum to be announced this month.

• Webtoon Entertainment (WBTN US) is looking to raise up to US$500m in its US IPO.
• Webtoon Entertainment is a global storytelling platform where a community of creators and users discover, create and share new content. 
• In this note, we talk about the positive aspects of the deal.

• A stabilizing property market matters more than other factors such as industry rivalry and shareholder return policies for the performance of leading China e-commerce players in our view.
• China’s worst property market downturn is probably behind us. This will gradually help restore consumer confidence and lift consumer propensity to spend, improving growth outlook for China e-commerce sector.
• We believe China e-commerce players will in general benefit from a stabilizing housing market. Alibaba remains the most attractive play in the space. 

• Companies in the 0% to 8% ROE group have low stock valuations and are in trouble because they are unable to step into value-creating management.
• Companies in this group, which includes many prime market listed companies, have done what is required by Corporate Governance Code, but could not take action to increase their ROE.
• The lack of significant differences in corporate governance practices for group with ROEs above 10% is due to foreign ownership not being significantly differentiated from other groups.

• Although Midea’s performance keeps growing, it is difficult for the home appliance industry to return to rapidly growing incremental market as it was during the robust development of real estate.
• As Midea’s To C business encounters growth bottleneck, To B business has become new performance driver and second growth curve, but several new businesses are facing challenges in 24Q1.
• For mature leading enterprises in home appliance industry, a valuation of 10-20x PE is reasonable, which means market value of RMB370-740 billion, assuming 2024 net profit would reach RMB37 billion.

• CP Axtra (CPAXT TB) is a merger upon a merger combining the Makro wholesale business and the Lotus hypermarket and supermarket businesses, along with a hybrid mall operation. 
• The combined entity continues to realise operational synergies in sourcing and logistics, with a strong B2B element. Omnichannel makes up more than 16% of sales and is growing rapidly.
• CP Axtra (CPAXT TB) provides an alternative retail exposure to its parent CP ALL (CPALL TB) with ongoing restructuring benefits still to be realised. Valuations look attractive relative to growth.  

• We are reiterating our Buy rating, $10 price target and projections for Vera Bradley with the company announcing 1QFY25 (April) results before the open on Wednesday.
• We believe, more than the 1Q results, which we expect to reflect the company’s desire to reduce inventory and start afresh, will be management commentary on their new relaunch of the Vera Bradley brand.
• We expect the “New Day,” which will launch on July 11th, to focus on core styles/categories, a new store look and expanding the appeal of Vera Bradley to a wider range of customers.

• Webtoon Entertainment (WBTN US) is looking to raise up to US$500m in its US IPO.
• Webtoon Entertainment is a global storytelling platform where a community of creators and users discover, create and share new content.
• In this note, we talk about the not-so-positive aspects of the deal.

• The June rebalance of the HSI, HSCEI INDEX, HSTECH and HSIII indices will use today’s closing prices to cap the index constituent weights at 8%/12%. This will lead to large flows.
• The round-trip trade across all stocks across the four indices is estimated at HK$32bn (US$4.1bn).
• Li Auto, Alibaba, NetEase, Zijin Mining, SenseTime and BYD Electronics are the largest buys while Tencent, Meituan, JD.com, Kuaishou Technology, Xiaomi and HSBC Holdings are the largest sells.

• In 1Q24, Pop Mart International Group L (9992 HK)‘s international sales grew around 250% yoy, and made up around one quarter of sales (vs. 17% of sales in 2023). 
• I now expect 39% sales growth in 2024, driven by 140% yoy growth in the international business and 18% growth in domestic China business. 
• I further expect a 50% yoy growth in net profit growth in 2024 driven by a 0.8ppt increase in gross margin and 0.5ppt in operating leverage. 

• On 3 June, GS Retail (007070 KS) announced that it will spin off Parnas Hotel and Freshmeat subsidiaries to simplify its business structure and enhance shareholder value.
• The company plans to create a new entity tentatively called Parnas Holdings which will include Parnas hotel and Freshmeat (a meat processing company). 
• We have a positive view of GS Retail’s decision to conduct this equity spin off which simplifies the business structures and it could raise the valuation multiples of GS Retail. 

• The market’s assumption of no special dividends in Chow Tai Fook Jewellery (1929 HK)‘s upcoming FY24 result is conservative, and this does not fit into its usual pattern. 
• Should it pay special DPS, the dividend yield may reach an attractive 10.7%. With its net cash position, CTF can financially maintain the average 135.6% payout ratio. 
• A return to its historical average dividend yield of 7.4% means that CTF’s share price will need to go up by 45% from the current level.

• Carnival Corporation is the world’s largest cruise ship operator with a large fleet and significant market share
• The company was severely impacted by the COVID-19 pandemic, halting service for 15 months and taking on substantial debt
• Since resuming cruises in July 2021, Carnival has seen a rebound in revenues driven by strong demand for post-COVID travel, but still faces challenges with cashflow and debt sustainability

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 target and projections for Betterware de Mexico after reviewing the June catalog.
• Despite the return of normalized comparisons, as supply chain issues began to normalize last year, June was another solid month for Betterware, as the catalog registered further SKU growth, continued higher levels of newness, and lower discounting.
• Further, these results were achieved despite the company pulling back from prior categories (Better Kids and Pets), making the YoY gains even more impressive.

OPAP delivered good revenue growth in Q124 while profitability declined, mainly due to the upfront investment to support a major new product launch, which should boost revenue as the year progresses and provide better leverage on the higher cost base. The broad message is of strong online growth with resilience in its land-based activities, which gives management confidence to reiterate its guidance for the year.

• Webtoon Entertainment is getting ready to complete its IPO on the NASDAQ exchange in 2H 2024. Webtoon Entertainment is a subsidiary of Naver Corp (035420 KS).
• Webtoon is seeking to raise as much of US$500 million at a valuation of US$3 billion to US$4 billion.
• Webtoon Entertainment is one of the largest Korean company related IPOs in 2024. 

• Nagatanien Holdings (2899 JP) recommended a Marunouchi Capital-sponsored MBO at JPY3,100, a 38.4% premium to the undisturbed price. 
• The transaction is a two-step acquisition through a cash tender offer and subsequent squeeze-out. The offer period is from 4 June to 16 July.
• While not a knockout bid, the offer represents a five-year high and requires a 58% minority acceptance rate. This is a done deal with payment commencing from 23 July.  

• MitCorp – the largest shareholder – and the Nagatani family – today announced an MBO where they will buy a classic ubiquitous brand at an Adjusted EV of 5.4x EBITDA.
• The equity check appears to buy at ~2.5x Mar27-29 average FCF but they probably have 50% of the shares in the bag. Retail, or who they sell to, matter.
• There is room for a noisy activist to get involved here and disrupt the retail ownership. But there are very few of those around. And none in it now.

• Alibaba Pictures’ revenue increased by 44% YoY and EBTIDA increased by 61% in the March quarter.
• Cainiao, Alibaba’s logistics network, plans to purchase fresh food from the places of origin.
• Li Auto finished a round of layoff, in which headcount was reduced to 22,000 from 30,000.

• Q124 showed solid top-line growth, impressive improvement in core margins
• We are not too concerned about moderating domestic hotel, air pricing
• After consensus EPS raised, TCOM a BUY below US$50 per ADS, in our view

• Since companies with higher foreign ownership have better profitability and corporate governance practices, it can be inferred that the overseas investor engagement has improved the company’s profitability and corporate governance.
• If the company’s management has changed to value-creating management through the overseas investor’s engagement, the company isn’t expected to change to value-creating management in just one year after “TSE’s request”.
• Many companies that do not receive overseas investor engagement have more room for improvement in aspects of management strategy execution and will be evaluated over time for improvements in profitability.

• Numerical targets for FY24/12 initial guidance are shown in the exhibit below.
• Despite initial guidance for consolidated OP of ¥800mn, an increase of ¥420mn (+110.3% YoY), the Company cites conservatively forecasting non-operating and extraordinary items such as interest expenses, restructuring costs, and exchange rate fluctuations for initial guidance for ordinary profit break-even and a net loss of (¥600mn) for profit attributable to owners of parent (see P2).
• Key initiatives and expectations for 2024 include: 1) in Japan, aim to provide more data-oriented and efficient services (online golf equipment sales GPM improving after 4Q inventory adjustment), 2) GOLFTEC golf lesson cash sales set to improve on coach issue addressed and marketing campaigns such as “7 shots better,” and 3) expand SkyTrak sales distribution channels. 

• In the month since GTX reported first quarter results, there have been more industry news pointing towards automobile models benefiting GTX. 
• Automakers are indicating to using ICE and hybrid for longer than expected, which should contribute to GTX’s ability to generate free cash flow beyond the next couple of years.
• We continue to expect 2024 sales to skew to the second half of the year, but GTX should generate adequate free cash flow to repurchase shares and reduce debt. 

• I am not a tax advisor and I do not play one on TV but it is a subject of interest in Australia, as an AFR article from June 2022 shows.
• The general gist: retail investors in Australia will take gains on stocks which run up in price, or get taken over, then look for losses to offset.
• The portfolio worked well in April. Now we let April ride and add the May basket.

• Several US customs brokers have been suspended under new, tighter rules
• The new rules could make ‘de minimis’ imports slightly more difficult
• Whether it lists in London or NYC, additional rule changes could threaten SHEIN

• Companies with larger market capitalizations tend to have higher profitability and valuations, and those companies have higher foreign ownership.
• Given that board practices improved and that valuations, highly correlated with foreign ownership, are higher for companies with larger market capitalizations, this can be due to engagement of overseas investors.
• If this hypothesis is correct, the gap between the top and bottom market capitalization companies will widen further as it takes a certain time for engagement to pay off.

• In the fourth quarter fiscal of 2024, Deckers Brands achieved record revenue growth of 18% compared to the previous year, almost reaching $4.3 billion of annual revenue.
• Gross margin increased by a considerable 530 basis points from last year to 55.6%, and earnings per share rose by 51% to $29.16.
• These results reflect Deckers’ successful long-term strategies and the hard work of its employees.

• Aisin is already achieving strong growth, across many markets, and this should continue with more sales into EV and HEV markets
• Financial strength is improving, with gearing moving lower, and debt/ebitda moving lower
• Balance sheet clean up can lead to some volatility, but overall a general positive, as is the focus on capital management

• From the Q4 2024 Earnings of VF Corporation, it can be inferred that the company is working on a transformation strategy named Reinvent to return to long-term growth.
• The company seems to be undergoing significant changes both structurally and operationally.
• Reinvent’s primary focus is on restructuring the U.S. business, cost base adjustment, and balance sheet enhancement.

• Based on the recent earnings, Ralph Lauren Corporation demonstrated credible fiscal performance despite the ongoing uncertainties of the global business climate.
• The company remained resilient with the successful execution of its Next Great Chapter Accelerate plan.
• On a positive note, President and CEO, Patrice Louvet, highlighted the progress made on several fronts.

• e.l.f. Beauty reported a solid 2024 fiscal fourth quarter, hitting a significant milestone of over $1 billion in net sales.
• The company grew net sales by 77%, exceeding expectations.
• Q4 marked the 21st consecutive quarter of both net sales growth and market share gains.

• Target Corporation reported its Q1 2024 financial results that were largely in line with its own expectations, while outlining various strategies and initiatives aimed at bolstering growth and profitability.
• Despite the challenging economic environment and volatility in consumer spending patterns, Target remains resilient, with its profitability continuing to benefit from prudent cost management and ongoing investments in strategic growth initiatives.
• However, softer trends in discretionary categories, particularly Home and Hardlines, may continue to pressure sales in the near term.

• BJ’s Wholesale Club Holdings, Inc., an American wholesale club chain reported its first-quarter earnings for fiscal 2024.
• The results from the call were mixed, with continued strong growth in membership fees and market share, supported by robust traffic and unit growth.
• However, the team cautioned that the first quarter’s robust projections could be challenging given the previous year’s inflation dynamics.

• SOUTHBOUND was again a net buyer for HK$29.7bn on small two-way volumes. Bank Of China Ltd (H) (3988 HK) dropped to #4 this week but SOE buying dominated.
• It is not clear how much of this is H/A discounts, expected dividend tax removal, and the KPIs for SOE CEOs to raise prices and payout ratios, but it continues.
• Valuations are acceptable. Flows are good. Policy changes are afoot. SOUTHBOUND may continue to see inflows – national team and otherwise.

• JPX-Nikkei 400 is composed of common stocks listed on the Tokyo Stock Exchange. It is a free-float-adjusted market-value-weighted (capped) index composed of 400 constituents.
• A periodic review is conducted by the Index providers, the JPX Group and Nikkei Inc, in August every year. We look at the rankings of the potential ADDs/DELs every month.
• In this insight, we take a look at potential ADDs/DELs for the JPX-Nikkei 400 index rebal event to come in August 2024 based on trading data as of end-May 2024.

• Bloks Group (1850960D CH) is looking to raise US$300m in its upcoming Hong Kong IPO. The bookrunners on the deal are Goldman Sachs, and Huatai International.
• Bloks Groups (Bloks) operates in the toy segment where it primarily assembles character toys. Its portfolio contains both self-developed and renowned licensed intellectual property (IPs).
• According to F&S, Bloks was China’s largest player in the assembly character toy segment with an approximate gross merchandise value (GMV) of RMB1.8bn in 2023.

• PDD Holdings Inc., an innovative online retail company based in China, seems to show a strong future trajectory based on its first quarter 2024 earnings conference call.
• The company surpassed its year-on-year growth with total revenue reaching RMB 86.8 billion, marking a 131% increase.
• This impressive growth serves as a testament to PDD Holdings’s efforts to deepen its access and widely influence the consumer market.

• Modine Manufacturing Company (Modine) reported upbeat performance for its fiscal 2024 with record sales and adjusted EBITDA being noted for the second consecutive year.
• Sales increased by 5% to reach $2.4 billion while adjusted EBITDA surged by 48% to $314 million; a significant margin improvement indicating the company’s effective commitment to its 80/20 principle.
• Modine successfully shifted its business to targeted markets with growth potential where its innovative solutions are well-regarded, leading to sustainable margins.

• We are reiterating our Buy rating and $37 price target for Guess?
• and tweaking and further back-end loading our FY25 and FY26 projections after Guess?
• announced 1QFY25 top and bottom line upside, driven by Europe and Domestic wholesale results, as the rag & bone acquisition proved to be a key positive and the company continues to take share in Europe.

• Dixon Technologies India Ltd (DIXON IN) growth is driven by mobile and EMS segment; majority of other businesses are muted in the last two years.  
• The company is able to convert earnings to cash quickly but cash yield is close to zero.
• The company has reported significant amount of refund liability, but is silent on its accounting policy. Other forensics takeaways include non-reconciliation of asset disposals, high forex risk, etc.

• Urban Outfitters, Inc. had an exceptional first quarter for fiscal 2025, performing better than expected with four out of five brands posting record revenues leading to an overall revenue of $1.2 billion.
• Anthropologie, Free People, FP Movement, and Nuuly all experienced double-digit growth, with record operating incomes reported for 3 of their brands.
• These strong results, however, were somewhat tempered by continuous weak performance at the Urban Outfitters brand.

• In the Q1 2024 earnings, Global-E Online Ltd reaffirmed its strong growth trajectory and bullish outlook for the rest of the year.
• For Q1, the company reported growth in gross merchandise volume (GMV), revenues, and adjusted EBITDA, surpassing the forecasted range for the quarter.
• GMV grew 32% YoY, revenues grew 24%, and adjusted EBITDA grew 47%.

• Lowe’s Companies reported its recent earnings and maintained the company’s expectations for fiscal 2024.
• Their first quarter sales were $21.4 billion, with comparable sales down 4.1% from the same period last year.
• Despite the continued pressure in DIY big ticket discretionary spending, the company delivered better-than-expected spring seasonal sales.

• In Fiscal 2024, Skyline Champion Corporation prioritized investments to offer integrated turnkey solutions for retail, financial services, and home completion.
• They experienced some decrease year over-year in their unit volume.
• However, the company reported over $2 billion in top-line revenue, indicating a solid financial year nonetheless.

• On Monday 27 May, Aisin (7259 JP) announced an offering to sell ALL of its 36+% stake in equity affiliate Exedy Corp (7278 JP) for likely ¥40bn+. 
• Exedy announced a big buyback to go with it. It bought back 30% of the total on Weds morning, and that reduced the size of the offer. 
• I had expected “short-term games” but we haven’t really had them. Which is a bit weird. This update shows the details and dynamics (they differ).

• Antfin will come out of its placement linked lockup for its remaining stake in Zomato soon.
• Ant Group had earlier sold some of its stake in Nov 2023 and Mar 2024. It still has over US$800m worth of shares left to sell.
• In this note, we talk about the deal dynamics and run the deal through our ECM framework.

• Emart and Shinsegae are facing concerns about put options of nearly 1 trillion won on private equity investors’ investment in SSG.com nearly six years ago. 
• From AEP and BRV’s point of views, they want to get their money back through put options since an IPO is not likely in the near term.
• The most probable result appears to be that this is likely to be dragged on for some time, which will cause continued concerns on both Emart and Shinsegae. 

• Sumber Alfaria Trijaya (Alfamart) booked a solid set of 1Q2024 results, a testament to its resilience during an election period, with the seasonal impact of Lebaran. 
• Minimarkets continue to be the winning format in Indonesia and Alfamart continued to gain share during 1Q2024, neck and neck with Salim-backed Indomaret if you include Alfamidi, Lawson, and Dan+Dan. 
• Alfamart will slow store openings to 1,300 stores this year after adding more than 1,800 outlets in 2023, with growth prospects remaining positive and profitability intact with a 25% ROE. 

• With one day left in the review period, we see 4 potential changes for the Stock Exchange of Thailand SET 50 Index (SET50 INDEX) at the June rebalance.
• Berli Jucker (BJC TB) could be added to the index following the market consultation that lowered the inclusion thresholds for Average Daily Trading Values and Turnover ratios.
• An equally weighted basket of potential adds has outperformed the potential deletes but there has been a deterioration in performance over the last month.

• Ace Hardware Indonesia (ACES IJ) continues to impress both in terms of SSSG and profitability, with numerous initiatives to drive future growth including more regular promotional campaigns and upgraded formats.
• SSSG for 5M2024 is well ahead of full-year guidance with strong growth momentum driven by ongoing campaigns, brighter new concept formats, and successful omnichannel initiatives providing additional growth impetus. 
• Ace Hardware Indonesia remains a top pick amongst Indonesian retailers, with valuations well below historical levels, despite the resurgence of growth and numerous initiatives in place both online and offline. 

• Companies with higher ratings for Corporate Governance Practices (Board Practices and Key Actions) tend to have significantly higher profitability, market capitalization and valuations.
• Foreign ownership has the highest correlation with the Metrical CG score, suggesting that years of overseas investor engagement have improved the companies’ corporate governance practices and profitability.
• The pace of efforts varies with criteria of Corporate Governance Practices.  Companies with Metrical CG scores of over 70% are ahead in % independent directors and % female board members.

• RICK is the largest strip club operator that also owns the struggling restaurant chain, Bombshells
• Strip clubs in RICK’s targeted locations are generally profitable due to limited competition and high barriers to entry
• Tootsie’s, a club owned by RICK, experienced significant revenue and EBITDA growth since its acquisition in 2007, showcasing the company’s ability to generate attractive returns on acquisitions in the strip club 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.

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.

• Fosun International
• Lenovo
• Lippo Malls Indonesia Retail Trust
• NTPC Ltd
• Rakuten

• RaaS Research Group has published an update report on 3D spatial data solutions group Pointerra (ASX:3DP) following its share placement to raise $2.05m before costs at $0.033/share.
• We had previously factored in a $2.5m raise into our forecasts in H1 FY25 and have now adjusted our model to include the recent raise in our forecasts.
• Based on our estimates, we don’t expect Pointerra to return to the market for additional equity before it reaches EBITDA break-even (H1 FY25 in our estimates).