Consumer

• We summarise the latest spreads and newsflow of merger arb situations we cover across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Philippines, Thailand and Chinese ADRs.
• Highest spreads: Yichang HEC Changjiang Pharma (1558 HK), Hollysys Automation Technologies (HOLI US), QV Equities Ltd (QVE AU), Ansarada Group Ltd (AND AU), Malaysia Airports Holdings (MAHB MK). 
• Lowest spreads: Chilled & Frozen Logistics Holdings (9099 JP), Mma Offshore (MRM AU), Great Eastern Holdings (GE SP), Mimasu Semiconductor Industry (8155 JP), Boral Ltd (BLD AU). 

• As expected, there are no constituent changes for the Hang Seng TECH Index (HSTECH INDEX) in June. However, there are float and capping changes.
• Estimated one-way turnover is 8% leading to a round-trip trade of HK$19.2bn (US$2.46bn). There is over 3x ADV to buy in Li Auto (2015 HK). 
• Short interest is quite elevated on a lot of stocks both in terms of days of ADV and in terms of free float.

• Lalatech Holdings, a technology based global logistics company, has updated its application for Hong Kong IPO and disclosed financial results for 2023.
• Lalatech Holdings is aiming to raise up to $1B and the company’s IPO looks imminent in the coming months as cash flow growth accelerated, while margins and profitability improved. 
• My fair valuation of Lalatech Holdings is close to $10B and investors should buy into upcoming IPO given the company’s substantial scale, massive network effects and operating efficiency.

• Excluding the special factor of companies applying transitional measures moving to standard, the pace of natural decrease of prime market listed companies is moderate.
• Companies with high foreign shareholdings and large market capitalization are already highly valued. Companies that are not have investment opportunities that are often at a discount due to liquidity.
• Nearly half of the companies are companies with large shareholders holding more than 20% equity; investment opportunities are expected to increase as companies go private through TOBs and MBOs.

• We are more bullish on PDD’s 1Q24 results on the back of better monetization of domestic e-commerce business and fast and quality growth of TEMU.
• We now expect 1Q24 adjusted earnings to almost double yoy to RMB20 billion, much higher than our previous estimate of 50% yoy growth and exceeding consensus by ~30%.
• Moreover, we believe earnings growth will be steady throughout 2024 instead of slowing down as we thought. 10x FY24 earnings against 80% yoy growth lead us to see 50%+ upside.

• Despite high growth in 2023, the accelerated growth of Giant Biogene has entered a turning point, and its performance has begun to slow down. Long-term growth momentum is highly uncertain. 
• Giant Biogene plans to prioritize the market entry of Class III medical device products.Due to increasing competition/challenges in marketing/promotion, it takes time to verify if the second growth curve works. 
• Reasonable valuation for Giant Biogene is P/E of 20-30x.If based on RMB1.8 billion 2024, market value is RMB36-54 billion. Short-term catalyst is the Online 618 Shopping Festival and 24H1 report.  

• Stellantis invested in Leapmotor and their joint venture will sell electric cars in Europe.
• Two vehicle producers, GAC and Li Auto, are dismissing employees.
• Tencent Music’s music revenue grew by 43% YoY in 1Q24.

• The Hershey Company reported optimistic market share trends in their Q1 2024 earnings.
• The firm has seen strong performances especially in seasonal sales and takeaway, with innovation being a significant growth driver.
• Its Reese’s Caramel product was quite popular among customers, with it not only being well received, but also helping drive strong merchandising especially around the Super Bowl season.

• The Walt Disney Company reported a strong performance in the first quarter of 2024.
• Disney’s CEO, Bob Iger, and the company’s CFO, Hugh Johnston, discussed their strategic focus on transitioning ESPN into a leading digital sports platform, developing streaming into a profit-generating business, reviving film studios, and enhancing growth in parks and experiences.
• 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.

• The Hang Seng Tech Index is more widely-followed than many think, and it is reasonably concentrated, so outperformance and underperformance by big names means capping and re-capping.
• This time, those flows are worth about 8% of the index in terms of one-way flows. Meituan, Xiaomi, JD.com, Tencent and Kuaishou Tech DOWN. Li Auto back up. 
• Those who have pre-positioned on the big buy have recently gotten hurt. There are some FAF changes which are less predictable and may be interesting.

• China momentum continues with KWEB breaking out above WEEKLY double-bottom base
• Stocks REPORTING this week that look technically sound include PDD BZ and EH
• In-Depth look at individual leaders in Tencent Holdings, Futu Holdings, and Sony Group

Dentsu’s Q1 results indicate a slow start to the year, with organic net revenue down by 3.7%. However, prospects are improving, buoyed by new business wins and weighted to H2, which leave full year expectations (and our forecasts) unchanged. The One dentsu initiative, bringing together skill sets in consulting, technology, media and creative, is supporting improved pitch win rates, and giving greater coherence and consistency to the group product and service offering. We expect this to be a central element of the new management medium-term strategy, set to be unveiled during H2. The rating remains at a substantial discount to global peers, which we anticipate will narrow as evidence of renewed growth builds.

• Naspers and Prosus have announced the appointment of Fabrício Bloisi as Group CEO, effective from 1 July 2024. Unlike his predecessor, Bloisi has an entrepreneurial background.
• Prosus and Naspers have sold off on the news. Prosus is down 1.7%, widening the discount by 80bps. Naspers is down 1.3%, widening the discount by 50bps.
• Since Bob van Dijk stepped down in September last year, both discounts have narrowed.

• JD.com (9618 HK) announced a set of in-line results for 1Q24.  Sales growth was 7% yoy, in-line with my 1Q24 preview.
• Operating profit margin for the core JD retail business declined by 0.5ppt yoy to 4.1%, which is also in-line with my preview. 
• The positive surprise was a big reduction in losses in the JD logistics business, which brought the overall non-GAAP net profit growth to 17% yoy for 1Q24. 

• Wheat prices are experiencing a significant resurgence due to extreme weather events and global supply-demand imbalances. Price is 22% higher over the past month. 
• May WASDE report indicates a positive outlook for global wheat production despite recent weather challenges, suggesting potential underestimations in global supply disruptions. 
• The anticipated shift to La Niña, coupled with historically low stocks-to-use ratios, threatens global wheat supply, heightening the potential for increased market volatility and price spikes.

• Expedia Group’s Q1 2024 performance reflected a primarily healthy market environment, but growth differed according to geographical area and product line.
• Notably, North America had the slowest growth compared to other major international markets.
• Additionally, despite meeting projections on revenue and EBITDA, Expedia experienced weaker gross bookings, with its Vrbo business producing slower recovery than anticipated.

• Few companies have disclosed their cost of capital, so TSE provided specific indicators for this purpose. On the other hand, allergies to cost of capital disclosure are persistent in companies.
• It is a concern that many companies still have more fixed remuneration than variable remuneration for compensation incentives, which are a mechanism for achieving capital profitability goals like ROE.
• Engagement with overseas investors can be effective, but there are challenges, such as the existence of passive funds and companies with small market capitalizations that are not eligible for investment.

• WOW is a cable and fiber overbuilder with a modern network but is facing financial struggles
• The company trades at a distressed valuation, making it an attractive investment opportunity for private equity firms
• Despite being undervalued compared to its industry peers, WOW’s assets have been acquired for higher valuations in the past, presenting a potentially lucrative opportunity for investors

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.

• Floor & Decor Holdings, Inc.’s First Quarter 2024 Earnings revealed several important financial developments.
• The company’s diluted earnings per share (EPS) for Fiscal 2024 came in at $0.46, surpassing expectations.
• Interestingly, this success was achieved despite the ongoing weak demand for hard surface flooring and can be attributed to the firm’s ability to strategically grow their gross margin rate and prudently control expenses.

• Phinia (PHIN) presents significant upside potential for investors in the vehicle parts sector
• PHIN focuses on aftermarket replacement, commercial vehicles, and off-highway markets
• Despite strong geographic diversity and solid financial performance, PHIN is undervalued compared to peers, indicating potential for stock price increase

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.

• Texas Roadhouse’s Q1 2024 earnings highlight a robust display of operational performance, driven by solid momentum across all segments and brands.
• With quarterly revenue surpassing $1.3 billion, a same-store sales growth of 8.4%, and continued commitment to guest experience and quality consistency, Texas Roadhouse has set a robust start for 2024.
• Despite a climate of economic uncertainties, the company posted record sales, margin dollars, and net income for the first quarter.

• Wayfair reported a marginal year-over-year decrease in revenue for Q1, around 2%, even as its customer base grew again, signifying the company’s continued momentum.
• Inventory levels are healthy and Wayfair noted the positive feedback from suppliers who are past the tough phase of facing elevated input costs and transportation prices in late 2022.
• Suppliers are substantially interested in partnering with Wayfair and featuring their products in promotional events and stores, among others.

• The Sep 2024 Nikkei 225 Review data set is mostly done, and one can interpolate results relatively accurately. It still leaves us with one ADD, one DELETE, and capping fun.
• Recently, Yanai-san sold more Fast Retailing (9983 JP). There is more Real World Float- more active holders own more stock (which may mean less interest to buy later).
• There is a dark horse candidate which is on investor radar for other reasons. It would not be out of the question, but the precedent is old, and different.

• L’Occitane (973 HK) announced that the share alternative pre-condition was satisfied. However, The share alternative offer is at the offeror’s discretion and with the consent of the financing parties. 
• The share alternative offer poses a dilemma due to the requirement to satisfy the minimum acceptance condition while not breaching the upper limit of the share alternative offer.
• The share alternative offer is a play on higher multiples by relisting the business. At HK$50.00, L’Occitane would trade in line with its median global beauty peers’ multiples.

• In the 29th April HK$34/share VGO announcement, a share scrip alternative may be afforded if 10% of L’Occitane (973 HK)‘s disinterested shareholders expressed interest by the 15th May
• That pre-condition has been satisfied. However, we are none the wiser whether you receive shares of the levered-up Bidco, at some undetermined scrip ratio; or keep shares of L’Occitane as-is.
• Some shareholders, like Butler Hall, considered terms low-balled. They now have the option to rollover. But there are still other large activists on the register, whose intentions are not known. 

• Two and a half years ago, H2O Retailing (8242 JP) the 10.9% owner, arranged to merge its own units into Kansai Super Market (9919 JP) to get control. OK Corp complained.
• OK Corp offered to double the price in a Tender Offer but wouldn’t go hostile. KSM/KFM said no go. Shares popped to ¥2,000+ then when the deal failed, they fell. 
• H₂O ended up with 58% (64.9% of votes now). The ultimate goal was to swallow it paying zero premium. On 15 May, it announced the merger to do just that. 

• On first look, Alibaba Group Holding (9988 HK) missed on margins in 4QFY24 as adjusted EBITA declined by 5% yoy.
• We can give the company the benefit of the doubt given that the important segments of the company are heading into the right direction.  
• Alibaba returned USD13.4bn and USD16.5bn to shareholders in FY23 and FY24, compared to the current market cap of USD197bn

• Giant Biogene (2367 HK) aims to raise up to US$205m via a top-up placement.
• We have followed the company since listing and its recent performance has been great. Although it doesn’t seem to need the cash.
• In this note, we will run the deal through our ECM framework and talk about the recent updates.

• BABA reported CY1Q24 top line, GAAP operating profit and non-GAAP net income 0.9%, (4.6%) and (6.7%) vs. consensus, and in-line, in-line, (6.9%) vs. our estimate;
• Results reaffirmed our positive view as increased investment is leading to significant improvement in key businesses: (1) Taobao/Tmall stabilized, (2) overseas e-commerce accelerated along with overseas AntFin and Cainiao
• We expect pay-off from its strategy shift in 2H of the year. Spin-off, dividends,and share buy-backs provide valuation support until then.We maintain BUY and US$85 TP, implying 9.5x CY25 P/E.

• Miniso (MNSO) reported C1Q24 revenue in-line with our estimate/consensus. Non-GAAP NI beat our estimate/consensus by 4.2%/2.6%, mainly due to better gross margin from IP sales.
• Company cited pressure on profits in C2Q24 due to store expansion, yet we still believe MNSO can maintain an OPM of 20% for entire 2024
• We maintain a BUY rating on the stock and maintain TP at US$34/ADS

• LOBO EV Technologies (LOBO) designs, develops, and manufactures micro mobility electric vehicles (EVs) and sells products through a broad-based dealership network in China, Southeast Asia, Latin America, and Europe.
• The company’s product lineup includes e-Bicycles, e-Mopeds, e-Tricycles, and electric off-highway four-wheeled shuttles (golf carts and scooters for elderly and disabled persons).
• In addition, LOBO provides automobile information and entertainment software development and design services.

• We are initiating coverage of Vince Holding Corp., a leading ready to wear brand, offering luxury men’s and women’s apparel, accessories and home goods via their own stores, online and in wholesale partnerships with key retailers, with a Buy rating and $3 price target, or 6.5X our FY25 EBITDA projection.
• We believe, after a momentous FY23, where the company formed a partnership with Authentic Brands Group, a leading brand licensor, materially recast their balance sheet with debt paydowns and maturity extensions, and began a $30 million transformation program, Vince is ready to shine once again in 2HFY24 and return to top line growth, with higher returns and a more enduring business model.
• As such, and with investor skepticism remaining a drag, we view the longer term risk/reward as compelling, and are initiating coverage of VNCE with a Buy rating and $3 price target.

• We notice a pickup in consumer acceptance of instrashopping, as result of COVID-cultivated behavior. We notice similar business model worked outside of China (Coupang) for densely populated urban upper-middle-class customers;
• Meituan’s launch of membership is a wise step towards strengthening user stickiness and emphasizing transaction soundness over impulsive buying. Meituan’s portfolio in food, dining, hotel & travel offer unparalleled value;
• We see Meituan’s success in Hong Kong honed a replicable business model targeting single and low priced segment. Consolation on a global scale now seems a possibility.

• Alibaba Group Holding (BABA US)‘s FQ4 announcement portrays a resilient comeback to growth, suggesting the past four years’ challenges barely impacted its dominance in Chinese e-commerce.
• However, a closer look beyond the surface of Alibaba Group Holding (9988 HK)‘s FQ4 results announcement reveals that little has actually changed in recent months.
• Taobao and Tmall face challenges in a tough, stagnant market; AIDC’s growth largely covers for other Alibaba units’ failings, while AliExpress’s expansion cuts into margins.

• Along with its fiscal 2024 results, Alibaba (9988 HK) announced that they were preparing for their primary listing in Hong Kong and the conversion was expected to complete by August.
• If the conversion is completed by the end of August, Alibaba (9988 HK) could be added to Southbound Stock Connect in September and that could bring in significant flows.
• We do not forecast any passive inflows due to the change with Alibaba Group Holding (9988 HK) capped at 8% of the HSI, HSCEI and HSTECH indices.

• We compile our selection of small and mid-cap names with our desired characteristics of high dividend yields, value, and margin of safety.
• Our top picks are Perfect Medical Health (1830 HK), Water Oasis (1161 HK), Taste Gourmet (8371 HK), Uchi Technologies (UCHI MK), and Ginebra San Miguel (GSMI PM).
• After a massive recent correction for HK stocks, we are more constructive on the names, and yields there look very attractive.

• On 15 May, it was reported in the local media that Affinity Equity Partners (AEP) is expected to launch a second tender offer for Lock & Lock (115390 KS).
• The tender offer price in this second tender offer is 8,750 won (same as the first tender offer). The second tender offer will last from 16 May to 5 June.
• In the first tender offer, only about half of the target was reached. There was a strong backlash from investors due to low tender offer price.

• Alibaba reported in-line revenue but disappointed adjusted net income for 4QFY24.
• Yet a closer look shows strong core Taobao/Tmall performance was offset by higher-than-expected losses incurred by peripheral businesses.
• We remain convinced BABA is on track to turn around and an earnings upgrade cycle is one or two quarters away. We are buyer at this price.

• The slowdown in Chinese retail sales of apparel seems to have been factored into Vipshop Holdings (VIPS US) 1Q 2024 revenue growth expectations whilst bottom-line is supported by margin expansion.
• With net cash at ~40% of its market cap, the share price should be supported by the ongoing share repurchase program and its inaugural annual dividend policy.
• Its 6.6x NTM PE ratio (~4x ex-cash) seems extremely attractive for a highly cash-generative business set to (conservatively) grow earnings at high-single-digits whilst buying back shares and paying dividends.

• Code of Corporate Conduct lacks explanation of the role to be played by a listed company and the background. Consequently, there’re cases where the same companies have repeatedly committed misconduct.
• For companies that are good at pretending that they are trying, without any substance to their corporate governance, making the provisions of Corporate Governance Code mandatory effort won’t be effective.
• TSE’s request seems to be an effort obligation. It is good that the substance of the company’s improvement plan, which only made an effort to improve, will be improved.

• SEBI observed White Organics and Add Shop Retail used circular transaction method to inflate financial performance of respective companies
• Promoter sell their holdings on the back of this inflated financial performance
• The forensic analysis delves into the modus operandi of these frauds

• Booking Holdings has made a robust start to 2024 by posting strong first quarter results.
• The company revealed that travelers booked nearly 300 million room nights across its platforms in Q1, exceeding its expectations and showing growth of 9% YoY. Moreover, revenue for Q1 stood at $4.4 billion, reflecting a growth of 17%, while adjusted EBITDA was approximately $900 million, climbing Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology.
• In this report, we have carried out a fundamental analysis of the historical financial statements of the company.

• Customer management as the largest business began to increase compared to the past two stagnant quarters.
• We believe margin will continue to decline as the company turned its focus to growth.
• We conclude an upside of 41% for March 2025 based on peer companies’ P/S ratios.

• The HSTECH Index tracks the performance of the top 30 technology companies listed in Hong Kong that have high business exposure to certain technology themes.
• The final results for the June 2024 index rebal event will be confirmed after market close on Friday 17th May 2024.
• In this insight, we take a look at our latest flow expectations.

• Cheerwin is a strong turnaround story with significant earnings growth in 2023 with solid dividend yield. It is the number one player in the inspect repellent sector in China. 
• Cheerwin’s current price is 79% lower than the IPO  price. However, Cheerwin’s shares are up 35% YTD, sharply outperforming Hang Seng index which is up 13.6% YTD.
• We found Cheerwin (6601 HK) using Smartkarma’s Smart Score Screener system. We used the following screening methodology: Market cap – More than $300 million Dividends = 5 only.

• GHCL Textiles (GHCLTEXT IN)  Aiming 25-30% revenue growth along with 15-20% average margins significantly increase the profitability of the company.
• Entering into value-added products like Functional fabrics and setting up their own manufacturing plant for fabric.
• Management Guidance on yarn prices, capex and debt profile of the company.

• While its share price has collapsed, China Tourism Group Duty Free (1880 HK) is still facing many challenges and uncertainties which render it unattractive at current level.
• Average duty free spending per customer in Hainan is 46% lower than the peak and 26% lower YoY in Mar 2024, and the downtrend looks to continue.
• The government’s efforts to strike down purchasing agents in Hainan duty free products and the island’s change to a duty-free zone are also negative developments.

• textLogic Inc. has entered into a definitive agreement to merge with Qoo10, a leading Asian e-commerce platform
• The deal values Wish at less than its estimated book value as of 12/31/23, reflecting the company’s struggles, but presents opportunities for growth and synergies
• The merger will allow ContextLogic to focus on monetizing its valuable NOLs and cash position, potentially unlocking additional value for shareholders and signaling a new chapter for Wish as it moves past its downfall

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, $14 price target, and projections for Lands’ End after reviewing the May catalogs for 2023 and 2024.
• The overwhelming focus for this month is swim, one of the core categories for the company.
• Lands’ End continues to drive deeper levels of newness to capture higher pricing and create a sense of urgency for purchases.

• Cinemark Holdings, Inc. is the 3rd largest movie theater chain in North America with over 500 theaters, making it a compelling risk/reward investment opportunity
• Stock has decreased in value due to concerns about potential impact of Hollywood strikes in 2024, but analysts anticipate a return to box office growth by mid-3Q 2024 and a focus on blockbuster films in 2025
• Analysts project >50% return in equity over next 6 to 12 months, with potential for greater gains in the future, citing Cinemark’s strong position in suburban areas with lower rent costs as an added attraction for investors

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.

• Vail Resorts has underperformed benchmarks in the past but is now poised for a turnaround
• The company has expanded its portfolio to 41 strategically located destinations and increased EBITDA and revenue by over 50% since 2018
• Despite increased leverage from acquisitions, the management team has effectively managed disruptions to the business and presents an attractive investment opportunity with potential for growth

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.

• Cafe De Coral Holdings (341 HK) share price never really rebounded post COVID despite its operating numbers gradually improving. 
• Haidilao International Holding (6862 HK) share price has rallied along with the Hang Seng Index (HSI INDEX) and Hang Seng China Enterprises Index (HSCEI INDEX) but not Cafe de Coral.
• Recent profit alert that, excluding pandemic subsidies, the group’s net profit will rise 470% YoY. 

• EssilorLuxottica has always played a long game in Japan but since 2018 the eyewear giant has been investing in local production and a growing store network.
• As reported by Mark Chadwick,Travis Lundy and myself, Luxottica has a stake in Paris Miki Holdings (7455 JP) and the Japanese firm is a key strategic interest for EssilorLuxottica.
• That Luxottica is increasing its investments in Japan retail through acquisition is evidenced by its takeover of Washin Optical, a 70-store eyewear chain, last month.

• Shiseido Company (4911 JP) reported 1Q24 results last Friday.  Core operating profit declined less than expected at -10% yoy, and exceeded the management’s target. 
• The beat was driven by robust growth in Japan, Americas, and EMEA, while China steadily recovered.  Overall sales growth was 4% yoy in the quarter. 
• As a reminder, the investment thesis for Shiseido is twofold:  a recovering China mainly due to one-off concerns (nuclear wastewater), and a margin recovery story in Japan. 

• The new energy vehicle producers’ ranks changed a lot in April.
• GAC began to sell batteries to outside new energy vehicle producers.
• Kuaishou’s GMV (Gross Merchandise Value) increased by 420% YoY during the Labor Day.

• Although many institutional investors’ voting criteria apply the rule of “support the proposed appointment of top management director if one female director is nominated,” more in-depth examination should be conducted.
• Agenda based on TSE’s request isn’t easy to understand for all investors, and the current voting guidelines for domestic institutional investors make it unlikely that they will vote for it.
• The ISS ROE criteria will be raised next year, and companies may not raise ROE with bold shareholder returns until the voting guidelines for domestic institutional investors are also raised.

• Takeaways: Biden plans to quadruple US/EU tariffs on Chinese EV imports.
• This will further defend TSLA’s domestic beachhead: 1) 50% EV market share in the USA (No. 2: Ford 7% ) + 2) huge headstart over domestic auto incumbents in assembly line processes (Gigapress) & high manufacturing concentration .
• Together, this should result in superior economies of scale which translates into lower unit costs — increasingly important in a commoditizing US EV sector.

• GoTo Gojek Tokopedia (GOTO IJ) booked an encouraging set of 1Q2024 results which provided a first look at the new structure, whereby suddenly e-commerce became cashflow positive for the company. 
• The company booked strong headline growth with core GMV increasing by +32% YoY, despite incentive & product spending decreasing by -31% YoY, whilst adjusted EBITDA losses fell -89% YoY. 
• GoTo will drive growth less through incentives and more through innovative products, increasing the user base, and focusing on retention through its subscription products, with fintech becoming increasingly important. 

• The second quarter performance for Johnson Controls was strong, with adjusted EPS coming in at the upper limit of company estimations.
• Johnson Controls managed to return to sales growth after experiencing a cybersecurity disturbance at the beginning of the fiscal year.
• Backed by productivity and the conversion of their higher-margin backlog, the company achieved robust margin expansion.

• TBO Tek (0395045D IN) raised around US$186m in its India IPO, after pricing the deal at the top end of the range at INR920/share.
• TBO Tek is a global travel distribution platform. Its two-sided technology platform serves companies involved in the travel industry such as hotels, airlines, travel agencies and travel management companies.
• We have looked at various aspects of the deal in our previous notes. In this note, we talk about demand and trading dynamics.

• Investors Flock Back Into Commodity Funds Investors are increasingly flocking to commodity funds again.
• A net €353 million flowed into funds from the Morningstar Broad Basket Commodities category in Europe in April.
• This was by far the best month for the category in over two years.

• We do not forecast any constituent changes for the Hang Seng TECH Index (HSTECH INDEX) in June but there could be capping changes for 7 stocks.
• Capping changes will result in a one-way turnover of 7.6% leading to a round-trip trade of US$2.4bn. 17 stocks will have over 0.5x ADV to trade from passive trackers.
• Li Auto (2015 HK) will have the largest inflow while there will be big outflows from Meituan (3690 HK), Xiaomi Corp (1810 HK), JD.com (9618 HK) and Tencent (700 HK). 

• ZEEKR, a rapidly growing premium EV maker, has successfully completed its IPO and raised ~$441M. The offering was priced at the top of the range at $21 per share.
• The company sold a total of 21M ADSs, up from the initial target of 17.5M shares. ZEEKR’s stock soared more than 30% following its strong debut on NYSE on Friday.
• Geely Auto, Mobileye and CATL have acquired ~14.3M ADSs and overall investor sentiment was positive. I believe ZEEKR may succeed as a high-volume EV maker worldwide.

• We summarize our gleanings from the conference call with Dream International (1126 HK) to better understand growth opportunities and future expansion plans.
• The company is expanding in Indonesia to increase its capacity by 30 million USD ( over 830 million USD). (capacity utilization for FY23:83%).
• Trading at 4x FY24e PE, with an 11.4% dividend yield and a 15-year average ROE of 20%, this is a stock worth exploring. 

• On 10 May, Cosmecca Korea (241710 KS) announced that it plans to switch its listing from KOSDAQ to KOSPI. 
• The company plans to convene an extraordinary general meeting of shareholders on 29 August to finalize on the switching of Cosmecca Korea listing from KOSDAQ to KOSPI. 
• Cosmecca Korea is one of the leading Korean ODM manufacturers of cosmetic products.

• The Quiddity Mainland Connect NORTHBOUND Monitor. Like the A/H Premium Monitor and HK Connect SOUTHBOUND Monitor. Lots of Flows/Position Tables and Charts with which to play.
• Last week saw NORTHBOUND net BUY RMB 4.8bn of A-shares on high gross low net volume in the two days. NORTHBOUND bought Kweichow Moutai, banks, Haier Smarthome, etc.
• HUGE week in H vs A (since the 30 April close). This may be colouring foreigner activity in As quite a bit. 

• Most large companies initially estimate sales and profits conservatively, and CapEx, which is often planned more than a year in advance, isn’t often above plan.
• Companies have a cautious earnings outlook, but the market consensus still expects profit growth in FY2024. CapEx growth in the BOJ Tankan is expected to be slightly higher than profits.
• Assuming an 8.5% increase in CapEx for large manufacturing companies and a low single-digit growth in the recurring profit outlook, the level of cash on hand is unlikely to decrease.

• Lear Corporation’s record-setting first quarter revenues of $6 billion show an increase of 3%.
• Core operating earnings were up 6% at $280 million, while adjusted earnings per share rose 14% to $3.18.
• Operating cash flow matched that of the same period the previous year.

• SiriusXM Holdings Inc. delivered a strong financial performance for its first quarter of 2024, with an encouraging 7% year-over-year increase in advertising revenue to over $400 million.
• This growth in ad revenue, driven by a growing addressable advertising audience and a strengthening ad market, helped offset a slight 1% drop in subscription revenue.
• The firm’s adjusted EBITDA was up 4% year over-year and delivered a margin of 30%, up 1 percentage point from the previous year.

• The latest earnings from Molson Coors Beverage Company indicates a strong performance in their first quarter, with substantial growth in top and bottom lines and consistent achievement of their acceleration plan.
• The company’s net sales revenue surged by over 10%, while its underlying pretax income increased by nearly 69%, underpinned by significant margin improvement.
• Additionally, the company reaffirmed its guidance for the full year.

• The Clorox Company’s third-quarter financial results suggest a continuing recovery from the August cyberattack that affected its operations.
• Despite lower sales and significant investments in its brands, the company’s adjusted earnings per share exceeded its own expectations in the said quarter.
• Adjusting for the effects of the cyberattack, the company reported that Q3 sales performance was, for the most part, in line with the management’s expectations.

• Sysco Corporation reported a sequential improvement in restaurant foot traffic over Q3 2024, starting with a tough January and improving throughout the quarter.
• The company noted that traffic, not same-store sales, drives distributor case volume shipments, with Sysco’s 2.9% case growth enabling profitable market share increase for the quarter.
• The company delivered strong earnings growth in a challenging volume environment, delivering adjusted operating income growth of 8.4% while anticipating future improvements in local case volume.

• In its first quarter 2024, Archer-Daniels-Midland (ADM) reported adjusted earnings per share of USD1.46, and an adjusted segment operating profit of USD1.3bn, representing an on-year decrease of 24%.
• ADM also achieved a trailing 4-quarter average of 11.2% for its adjusted Return on Invested Capital (ROIC) during the same quarter, while maintaining a strong balance sheet and healthy cash flows.
• Although the global grain and oilseed supply is expected to increase throughout the year amid an anticipated improvement in weather conditions, ADM proactively managed the risk of falling margins by driving the structural earnings, ROIC, and cash flow generation, enabling the company to continue investing in its business and returning cash to its shareholders.

• Mondelez International had robust Q1 2024 with solid top line results, strong earnings, and free cash flow generation.
• The performance was buoyed by momentum in emerging markets where consumer confidence is high and categories are resilient.
• The company faced challenges such as disruption with European clients and boycott of Western products in the Middle East and Southeast Asia.

• Starbucks’ second quarter fiscal year 2024 results reflect the challenges and opportunities the company faces in a changing marketplace.
• While global comparable store sales declined by 4% year-over-year and the company’s total revenue dipped by 1% to $8.6 billion, a decline in foot traffic in North America and a hefty decline of 11% in China being a few of the contributing factors.
• The company was also affected by severe weather conditions, causing a nearly 3% impact on both US and total company comp during the quarter.

• ADM’s stock has dropped by 22% due to an investigation into its Nutrition segment’s accounting practices
• Executives may have had incentives to inflate the segment’s profitability, potentially leading to a scandal
• While the situation presents a buying opportunity, the issue is unlikely to be as pervasive as Enron’s scandal and the underlying business is expected to survive.

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, projections and $0.25 price target for Starco Brands with the company reporting 1Q24 (March) results after the close on Wednesday.
• We believe 1Q saw continued progress on multiple levels, with Whipshots rolling out new flavors and now in almost all 50 states, Soylent expanding their protein offerings, Art of Sport beginning its soft launch on Amazon and Skylar expanding new product categories and fragrances.
• As such, and with management remaining focused on driving cost savings and leveraging their relationship and knowledge of the aerosol-driven manufacturing segment, we remain focused on both top line and margin opportunities at STCB. We reiterate our Buy rating and $0.25 price target.

• 3QFY24 EPS was $0.21 versus a depressed $0.08 in 3QFY23 and above our $0.16 estimate.
• 3QFY24 EBITDA of $5.1 million beat our $4.6 million estimate and was up sharply from $3.3 million a year ago.
• EBITDA margin of 10.5% exceeded our 8.7% estimate, driven primarily by lower commissions and incentives as a percentage of sales than we expected (210 bps), as well as lower SG&A (70 bps).

• Stellantis has reported strong results in its Full Year 2023 Results, demonstrating the company’s high resilience even amid challenges.
• Stellantis’ CEO, Carlos Tavares reflected on the record net revenues, net profit, and free cash flow for the year, showing an increase of 6%, 11%, and 19% respectively.
• The CEO noted that Stellantis’ strategy is all about profitable growth.