Consumer

• I tally 44 – 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: T Gaia (3738 JP)‘s and Shinsegae E&C (034300 KS) Tender Offers, and MPHB (MPHB MK)‘s SCR. Plus ASMPT (522 HK) in the crosshairs. Again.
• Key updates took place on: Sigma Healthcare (SIG AU), Descente Ltd (8114 JP), Shin Kong Financial Holding (2888 TT), Pacific Smiles (PSQ AU), and Greatview Aseptic Packaging (468 HK).

• TCL Technology Group Corp.
• (000100.SZ +7.51%), a leading Chinese electronics maker, has agreed to pay 10.8 billion yuan ($1.54 billion) to acquire LG’s two display factories in Guangzhou, as Chinese manufacturers strengthen their dominance in the liquid crystal displays (LCD).
• TCL China Star Optoelectronics Technology (TCL CSOT), a subsidiary of TCL Technology, will acquire 80% of LG Display China and the entire stake of LG Display Guangzhou.

• TSE’s classification translates into three groups: companies which can independently increase capital profitability, companies which haven’t yet fully implemented plans, and companies which haven’t yet responded to “TSE’s request.”
• Mock engagements by TSE, which doesn’t have voting rights, will be focused on whether they actually make the company think about management strategies and implement them, thereby increasing corporate value.
• To help companies effectively implement “TSE’s request,” an idea would be to offer time-limited discount on listing fee paid to TSE by companies that have significantly increased their market capitalization.

• Tesla’s third-quarter 2024 report has left investors with more questions than answers.
• The company delivered 462,890 vehicles, narrowly missing analysts’ estimates and triggering a 2% decline in premarket trading.
• While Tesla remains a dominant force in the electric vehicle (EV) industry, it faces mounting challenges, including increased competition, leadership shakeups, and frequent product recalls.

• General Mills noted a slight improvement in the macro environment, with North America Retail categories experiencing some growth.
• However, this wasn’t attributed significantly to a permanent shift in consumer behavior towards more at-home food consumption, but rather a reaction to current economic stresses where at home meals remain a more economical option for consumers than eating out.
• 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.

• Darden Restaurants, Inc. has reported its financial performance for the first quarter of fiscal year 2025, exhibiting mixed results that underscore the prevailing challenges and operational strides within the competitive dining industry.
• Despite burgeoning industry headwinds and a dip below expectations for the quarter, Darden’s strategic maneuvers and robust brand portfolio continue to fortify its market position.
• 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.

• Cable One’s Q2 2024 earnings reflected a transformative period for the company amidst evolving market challenges and the ending of the Affordable Connectivity Program (ACP).
• A crucial aspect highlighted was the ending of ACP, which resulted in the loss of about 4,000 customers from an approximate total of 48,000 affected customers.
• Despite these challenges, Cable One managed to sustain customer growth trends positively, leveraging their robust network and local market initiatives to mitigate losses.

• Nippon Paint Holdings (4612 JP) is a branded decorative paint player.  China made up nearly 40% of the operating profit of the company. 
• Saizeriya (7581 JP) is a Japanese restaurant chain of fast casual Italian food, with currently the majority of operating profit and growth coming from China.
• Shiseido Company (4911 JP) is a Japanese beauty company that relies heavily on China.

• China’s key electric-vehicle (EV) makers set monthly delivery records in September as government subsidies and price cuts gave sales in the fiercely competitive industry a boost.
• BYD Co. Ltd. (002594.SZ +8.21%), the country’s top EV-maker, sold 419,426 vehicles in September, according to an exchange filing Tuesday.
• The figure, which consisted of 164,956 battery EVs and 252,647 plug-in hybrids, marked a 45.9% year-on-year increase and a new monthly sales record.

• Dhampur Bio Organics (DBOL IN): Integrated sugar manufacturer listed in 2022 post demerger from Dhampur Sugar Mills (DSM IN) 
• With change in Ethanol policy from Sep-24, Company will be significantly benefitted with its grain-based ethanol plant and higher sugar production with good monsoon. 
• Company is reducing its debt significantly to deleverage its balance sheet.

• Ermenegildo Zegna Group recently provided an overview of its financial performance and strategic initiatives for the first half of the fiscal year 2024.
• Despite operating in a challenging global environment, particularly within the luxury sector, the company reported year-over-year revenue growth of 6%, supported by the consolidation of Tom Ford fashion and the ongoing strength of the Zegna brand.
• This growth translated into a gross profit of EUR 637 million and an adjusted EBIT of EUR 81 million.

• Despite the drastic bull turn in Chinese equity sending MNSO’s share 41% from its trough, we see MNSO’s investment in Yonghui Superstores as a risk venture.
• We believe the market has overestimated the scalability of the Pangdonglai rectification program for offline retail. 
• We downgrade the stock to SELL rating and cut TP to US$18/ADS

• Marriott Vacations Worldwide reported mixed financial results for the second quarter of 2024.
• The quarter saw slight growth in tours, potentially due to an emphasis on attracting new members, but this was mitigated by a decline in Vacation Ownership Point Generations (VPGs), especially among first-time buyers, which has impacted the overall contract sales negatively.
• The company highlighted flat VPGs among existing owners, indicating sustained interest and valuation of vacations among this group.

Card Factory’s H125 revenue growth demonstrated it is delivering well against its multi-year growth strategy. While profitability was negatively affected by the (mostly) known inflation in operating costs, management is confident Card Factory will achieve its full-year estimates. This is due the momentum in the business and the mismatch in H125 between cost inflation and the efficiency and cost savings that have always been expected to come through in H225.

• PVH Corp. reported its financial results for the second quarter of 2024, reflecting a blend of successes and strategic pivots amidst a challenging global economic environment.
• Under the leadership of CEO Stefan Larsson, PVH Corp. has managed to align its performance with guidance expectations while surpassing estimates on profitability.
• The quarter showcased a revenue performance in line with PVH’s projections, with a noteworthy increase in EBIT margins owing to a significant 250 basis point expansion in gross margins.

• Five Below’s second-quarter results for fiscal 2024 reflect a period of significant changes and challenges alongside the initiation of strategic shifts aimed at repositioning the company for future growth.
• Under the interim leadership of Kenneth Bull, following a recent CEO transition, the company undertook a detailed review of its operations and business strategy.
• This quarter’s earnings reveal some concerning trends but also highlight areas where management is actively working to steer the business back to its growth track.

• TopBuild Corp. delivered a robust performance in the second quarter of 2024, reflective of a solid growth trajectory despite challenges posed by the higher interest rate environment and supply chain constraints.
• The company capitalized on opportunities across its diverse business model, supporting long-term growth despite the headwinds affecting the residential and commercial sectors.
• 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 drugstore space in Japan is super-interesting. The stories, the mergers, the activists. And of course, the defence against activists.
• In Feb-2024, Aeon did a deal with an activist to cause a future deal between Tsuruha and Welcia. Aeon also owns a stake in Kusuri no Aoki Holdings (3549 JP). 
• The Aoki brothers (CEO and VP) exercised warrants in August and re-arranged their holdings. Now the family owns 34.7%. Today, after Q1 earnings, the company announced a 5+% buyback.

• Netflix recently hit an all-time high on the stock market, capitalizing on the chaos in the entertainment industry
• The company was initially seen as a renegade tech startup, leading the streaming market with its first mover advantage
• After reporting a loss in subscribers, Netflix announced plans to launch an advertising-supported business to combat competition in the streaming wars.

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

• Back on the 16th July, furniture trader Samson Holding (531 HK) announced an Offer, by way of a Scheme, from Shan Huei Kuo, Samson’s Chairman.
• The Cancellation Price is $0.48/share (final), a 50% premium to last close; but more notable if going back a month. This looks done. However, Samson is an illiquid micro-cap.
• The Scheme Doc is now out, with a Court Meeting to be held on the 21st October. Expected payment on the 14 November. The IFA says fair & reasonable.

• Samson Holding (531 HK)’s IFA opines that Mr Samuel Kuo (Chairman)’s HK$0.48 privatisation offer to be fair and reasonable. The vote is on 21 October. 
• Key conditions include approval by at least 75% of independent shareholders (<10% of independent shareholders rejection). Despite the market rally, most peers’ shares have declined since the offer announcement. 
• The attractive premium, lack of shareholders holding a blocking stake, and low AGM minority participation rate point to a done deal. At the last close, the gross/annualised spread is 3.2%/29.8%.

• A third of the way through the review period for the December rebalance of the Stock Exchange of Thailand SET 50 Index (SET50 INDEX), we see four potential index changes.
• Passive trackers will need to buy between 0.5-4.3 days of ADV on the inclusions and sell between 0.1-2.9 days of ADV on the deletions.
• The forecast adds have outperformed the forecast deletes and the Stock Exchange of Thailand SET 50 Index (SET50 INDEX) over the last 5 months.

• Astra International is well-positioned to fend off the challenge of incoming EV players to Indonesia, a country far more suited to Hybrid EVs, with little charging infrastructure.
• Despite new entrants, the company has maintained its market share at 57% YTD, with Chinese EV makers fighting amongst themselves and other Japanese ICE brands losing some share. 
• Astra continues to develop new HEV products, with a line up of 10 BEVs due by 2028 from Toyota but investments in the ecosystem are already underway. Valuations remain attractive.

• China Resources Beverage (CRB HK), China’s largest purified drinking water company, is premarketing an HKEx to raise US$0.5-1 billion.
• We previously discussed the IPO in CR Beverage IPO: The Bull Case and CR Beverage IPO: The Bear Case. In this note, we examine the latest updates in the PHIP.
• The investment case rests on core business offsetting slowing growth with margin improvement, beverage’s fast-paced growth, narrowing the margin gap with Nongfu Spring (9633 HK), and return to FCF generation.

• Oriental Watch (398 HK) will report its H1 FY25 result in mid-November. We expect earnings to be down 5-10% YoY, as SSSG would be flattish for the period.
• We expect a 25-26 cent dividend ( ~14% yield annualized). With the stimulus measures in place, we expect China’s mood to be slightly more upbeat.
• Oriental Watch (398 HK) goes ex-dividend today (23.5 cent/share dividend). As we enter trading today, it may be available at a higher yield. 

• Modine Manufacturing Company reported a strong start to Fiscal 2025, showcasing significant growth and operational successes across its segments.
• The company’s proactive strategic initiatives, including acquisitions and the implementation of a transformative 80/20 business strategy, have evidently positioned it well for sustainable growth.
• However, adjustments in performance expectations in specific segments highlight the ongoing adaptation to market conditions.

• BellRing Brands, created through acquisitions by Post Holdings, has experienced substantial growth, with its stock price increasing from $20 to $59 since its last write-up on VIC over four years ago.
• While some brands like Powerbar and Dymatize have underperformed, Premier Protein has been a standout success for BellRing Brands.
• With anticipated sales of $2 billion and EBITDA of $410 million for fiscal year 2024, BellRing Brands is viewed as a compelling investment opportunity with a promising future and reasonable valuation.

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.

• China Resources Beverage (CRB HK) is looking to raise up to US$1bn in its upcoming Hong Kong IPO. 
• China Resources Beverage manufactures and sells packaged drinking water and RTD soft beverages in China.
• In our earlier notes, we talked about the company’s past performance and provided our thoughts on valuations. In this note, we will look at updates from its most recent filings.

• 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.
• In this insight, we take a look at the final rankings of potential ADDs and potential DELs for the December 2024 index rebal event.
• We do not expect any changes for the HSTECH index in December 2024. However, we expect there to be capping flows of US$1,079mn one-way.

• The Japanese eyewear company Intermestic (262A JP) has set the terms for its Tokyo IPO and plans to raise US$121m through the IPO.
• Our analysis shows that the company’s IPO is valued attractively compared to JINS Inc (3046 JP) , who offers eyewear at a similar price range to Intermestic.
• Japanese eyewear makers who have aggressively expanded into overseas markets seems to be suffering from falling sales and margins, particularly in China due to economic slowdown.

• Fast Retailing, through its flagship Uniqlo, is redefining retail by focusing on high-quality, functional apparel, surpassing global peers in operating profit margins.
• The company’s “scrap & build” strategy revitalizes underperforming stores in China, while expanding internationally, with a strong growth trajectory across North America and Europe.
• With a revised fair value of 52,500 yen, we forecast significant sales growth, driven by favorable seasonal trends, global expansion and recovering consumer sentiment in China.

• China Resources Beverage (CRB HK) is looking to raise up to US$1bn in its upcoming Hong Kong IPO.
• China Resources Beverage manufactures and sells packaged drinking water and RTD soft beverages in China.
• In our earlier notes, we talked about the company’s past performance and provided our initial thoughts on valuations. In this note, we will relook at valuations post its PHIP updates.

• Nongfu Spring is able to take a price war to grab market share,but the strategy of CR Beverage forced to cut prices may not work,making its profit margin further decline.
• CR Beverage’s business model is “single business + scale expansion”, worse than “multi-category structure + new product incubation”.Future performance growth may inevitably slow down if without the second growth curve.
• Whether in terms of product/revenue structure, profitability, or sustainability of growth momentum, CR Beverage isn’t as good as Nongfu Spring. Valuation of CR Beverage should be lower than Nongfu Spring.

• We are gradually building a high-conviction coverage of ideas for the mid and small-caps in the Philippines.
• We set criteria for high ROCE, reasonable growth (10-15% YoY), strong balance sheets, and reasonable capital allocation (dividend yields), all ingredients for being multi-baggers.
• We like Ginebra San Miguel (GSMI PM), The Keepers Holdings (KEEPR PM), and DigiPlus Interactive (PLUS PM).  We recently included Sti Education Systems (STI PM) in our coverage

• We are reiterating our Buy rating, projections and $3 price target for Vince after meeting with management in their European headquarters and touring the Galeries Lafayette shop in shop in Paris.
• We believe, with the company now well capitalized and acting in a materially more strategic fashion, the European opportunities, from owned stores to additional wholesale to category expansion, position Vince to drive material international growth going froward.
• When coupled with strong product offerings and what we believe are material opportunities in the domestic market, we believe Vince is ideally positioned to register material top and bottom line growth, and we reiterate our Buy rating and $3 price target for VNCE.

• Of the companies that have been removed from the list of companies subject to transitional measures, only about half have been able to meet the criteria for maintaining their listing.
• It’s not easy for companies applying transitional measures to comply with the criteria for maintaining listing, so it’s realistic to move to a market with looser criteria for maintaining listing.
• Besides problems with listing screening process, many managers consider IPO to be the goal and have little will to grow the company after listing, leading to slump in corporate value.

• At end-September, the Nikkei 225 semi-annual review imposed a “cap” on Fast Retailing (9983 JP) in the Average, applying a 0.9 coefficient to the Price Adjustment Factor.
• At its current weight, Fast Retailing will be capped again in March 2025. If the stock outperforms Nikkei 225 by another 3% before 31 January 2025, it could be double-capped.
• And an additional 16% would mean ¥1.1trln of sales in March. But like last time, this is a rubber band which stretches. Too far, and selling pressure is obvious.

• The review period for the December rebalance of the Hang Seng TECH Index (HSTECH INDEX) ended on 30 September.
• We do not forecast any constituent changes for the index. Capping changes will lead to a one-way turnover of 2.15% and a round-trip trade of HK$6.1bn (US$785m).
• If any stocks have outsized moves on expectations of being added to or deleted from the index, there could be opportunities to enter trades.

• China Dongxiang (3818 HK) stands on a discount of 82.1% to NAV after factoring in the recent market rally, not limiting to its Alibaba Group Holding (9988 HK) holdings.
• Its listed equities may have gained Rmb314m, but the HK$41m market capitalisation growth has not reflected this. The gains on its unlisted investments have not been included yet.  
• CNDX is now more likely to have a positive swing in the bottom line in FY25. Its tiny sportswear business has also witnessed a sequential moderation in sales decline. 

• Tesla aims for 462,000 deliveries in Q3 2024, with analysts predicting actual numbers could reach 470,000 units. This increase highlights strong demand, particularly in China.
• Vehicle registrations in China rose nearly 20% QoQ, driven by the Model Y’s popularity. Despite expiring subsidies, Tesla expects Q3 deliveries to exceed its previous best quarter by 5%.
• Tesla’s stock is up only 4.85% year-to-date, significantly lagging the S&P 500’s 21% rise. Factors include declining EV demand, price cuts affecting margins, and increased competition.

• We are reiterating our Buy rating, $29 price target and projections for Guess?
• after visiting the newly opened Guess Jeans store and wholesale displays in the Milan metro area.
• Guess Jeans represents the company’s focus on a younger, more environmentally driven consumer who is looking for easy to wear, primarily denim driven basics.

• RELX has presented a robust financial performance for the first half of the year, accomplishing considerable growth across its various business segments.
• The highlight includes a 7% increase in underlying revenue and a 10% rise in underlying adjusted operating profit.
• The adjusted earnings per share also grew by 10% at constant currency, reflecting a persistent upward trend in the company’s profitability.

• Sacks Parente Golf (NASDAQ: SPGC) is an innovative, technology driven golf company with a growing portfolio of golf products, including putters, golf shafts, golf grips, and other golf-related accessories.
• The company went public in August 2023 raising $11.6 million in net proceeds.
• The company announced its entry into the golf shaft market in November 2023.

Greggs demonstrated continued strong sales growth in Q324, against a challenging Q323 comparative. The company continues to benefit from its multipronged growth strategy of increasing space, extended trading hours, new digital channels and menu development. Management is confident of meeting its full year expectations, helped by marginally lower cost inflation than previously expected.

• Today, Itochu Corp (8001 JP) announced that it had received SAMR approval and would launch its Tender Offer to take private its affiliate, Descente Ltd (8114 JP). 
• As warned last year, Descente is cheap on a forward basis due to very strong growth and profitability of Descente China Holdings but Itochu can downplay that future.
• And indeed, it appear they did, and unless someone takes them to task, this probably gets done. So far, nobody has.

• Today, just before the close, the Nikkei put out a scoop that Bain would buy T Gaia Corp (3738 JP) for ¥140bn. Sounds big. It was a 30% discount.
• There is a three Tender Offer process whereby minorities, who could be squeezed out regardless, are offered the opportunity to block the deal by not tendering at ¥2,670.
• This not-quite “majority of minority” of the super-minority is an interesting governance condition established by the Special Committee. It bears some study.

• T Gaia Corp (3738 JP) disclosed a Bain tender offer at JPY2,670, a 35.9% premium to the undisturbed price but a 27.2% discount to the last close.
• Bain has set the minimum number of shares to be purchased at a 12.67% ownership ratio to appease the Board, which has a neutral recommendation. 
• Bain hopes the offer’s harsh reality check will burst the share price bubble, nudging minorities to accept. An auction process suggests that the chance of a competing offer is low.   

• Swiggy (1255298D IN) Swiggy is looking to raise about US$1.25bn in its upcoming India IPO. The deal will be run by Kotak, Citi, Jefferies, Avendus, JPM, BofA and ICICI.
• Swiggy Limited (Swiggy) is a business to commerce (B2C) marketplace company offering users a platform for ordering grocery and household items (Instamart) and food delivery, through its on-demand delivery network.
• The platform can also be used to make restaurant reservations (Dineout), event bookings (SteppinOut), product pick-up/drop-off services (Genie) and other hyperlocal commerce activities (Swiggy Minis).

• Descente Ltd (8114 JP) has announced that Itochu Corp (8001 JP)’s tender offer precondition has been satisfied. The offer terms are unchanged at JPY4,350 per share. 
• The offer is arguably light due to the peer re-rating and historical trading ranges. It is also below the midpoint of the special committee’s IFA DCF valuation range. 
• Nevertheless, the offer will likely succeed. There is no vocal opposition, the volume traded through terms is low, and the offer implies a premium multiple compared to peers. 

• Temu as a subsidiary of PDD becomes the second largest global e-commerce website.
• Meituan merges departments into fewer business units to cut expenses further.
• Mercedes-Benz left the joint venture with BYD, as its high end products are not as popular as Tesla models.

• Certainly, the “TSE’s request” has begun to change companies’ mindsets, but what we focus on now is whether they have put the plan into action and whether it’s producing results.
• The importance of investor engagement is also indicated in the Japan Investor Relations Association’s survey summary. Companies that receive overseas investor engagement are furthering their efforts to improve profitability.
• Even among companies with high IR awareness, few have taken serious steps to reform their business portfolios, as under 60% have begun to reform business portfolios.

• PepsiCo’s 2024 second quarter earnings report reflects a complex landscape shaped by strategic adjustments and variable consumer behavior, especially in the context of a challenging US market.
• The company’s results are indicative of both resilience and areas requiring attention, navigating ongoing economic shifts and consumer sentiment.
• 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.

• Harley-Davidson recently reported its financial results for the second quarter of 2024, showcasing several advancements and challenges in its performance.
• The company reported a 12% increase in consolidated revenue, driven by growth in both the Harley-Davidson Motor Company (HDMC) and the Harley-Davidson Financial Services (HDFS) sectors, marking a resilient performance amid prevailing economic headwinds.
• The earnings per share showed a significant improvement at $1.63, and the overall operating income grew by 9% to $241 million.

• The latest earnings presentation from British American Tobacco (BAT) provided an in-depth view of the company’s performance and strategic approaches amidst its significant transitory phase.
• BAT is navigating through a challenging market landscape, marked by robust investments in transformation and innovation, particularly aimed to strengthen their U.S. business and accelerate new category offerings globally.
• 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.

• Hong Kong is showing strong market momentum as consumer staples, consumer discretionary, healthcare and tech surge on increased momentum.
• Xtep International (1368 HK) had a good 1H24 and benefited from better consumer sentiment. Analysts are upgrading Tongcheng Travel Holdings (780 HK) on an improved outlook.
• Goldman Sachs upgraded their rating on Bilibili (9626 HK) , Bilibili (BILI US) to a BUY with improving user MAU/DAU measures and the success of its newly launched game.

• Welcome to Consumer Tales & Trends, your weekly roundup of the latest corporate developments, investment reports and sector events in the consumer industry.
• Despite weak consumer spending in China, there are a few bright spots—an example is Pop Mart International Group (9992 HK)’s strong sales growth partly driven by the “red lipstick effect.”
• Miniso (MNSO US)’s stock plunged early last week but quickly recovered, reinforcing our view that its deal with Yonghui Superstores Co., (601933 CH) has some promise.

• The Chinese drinking water and beverage maker, China Resources Beverage (CRB HK) has filed for an IPO on the HKEx to raise around US$1.0bn.
• The company’s operations are heavily concentrated towards drinking water products where the market competition is intensifying leading into a price war.
• CR Beverage’s margins are inferior compared to peer Nongfu Spring (9633 HK) who has diversified into other beverage products from drinking water to grow its financials.

• Since it’s difficult for all prime market companies to achieve the 30% female board members by 2030, the goal may be achieved by including non-statutory executive officers in board members.
• Companies are stuck in matching numbers, and government is unwilling to address the fundamental issues. There’s risk that original objective of shifting to value-creating management through ensuring diversity is lost.
• Policy changes to create environment where women don’t have to leave workforce for childbirth, childcare, etc., and to change people’s mindsets are impossible without the leadership of a non-diverse legislature.

• MercadoLibre continues its climb, hitting new highs in both Average Weight (0.4%) and Funds Invested (23.42%).
• In the last six months, 4.2% of funds have added MercadoLibre to their portfolios, while key EM holdings HDFC Bank and AIA Group have seen declining ownership.
• 20 new positions have been opened over the last 6-months, with Goldman Sachs Global Impact Opportunities and Fidelity Special Situations among the fresh buyers, against only 6 closures.

• The weak business, social entertainment, become insignificant in recent quarters.
• All operating data in music is promising, including paying user base, ARPPU, and sublicensing revenue.
• We set an upside of 20% and a price target of US$14.80 for the end of 2025.

• 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,  it hasn’t been this busy for a while, with deals live in Japan and Korea, and possible launches in Hong Kong and India as well.
• On the placements front, there were a few China ADR blocks and other placements across the region.

• RaaS has published an update report on agri-FMCG group Ricegrowers, trading as SunRice (ASX:SGLLV), updating our Sum of The Parts (SoTP) valuation as we move from FY24 estimates/consensus data to FY25.
• In moving our consensus valuation year from FY24 to FY25, we look back on selected RaaS peer EPS growth trends over the past four years (FY23a-FY26f inclusive).
• Only four stocks including SGLLV [the others (ASX:TWE), (ASX:RIC) and (SB:EBRO)] have not or are not forecast to have a down year during this period.

• Sun Art Retail (6808 HK) entered a trading halt under the Code on Takeovers and Mergers. Bloomberg suggests Alibaba Group Holding (BABA US)’s stake is attracting preliminary interest from PE.
• Alibaba built its 78.70% stake through two purchases in 2017 (HK$6.50) and 2021 (HK$8.10). An exit would align with the strategy to focus on the core business segments. 
• The recent Miniso-Yonghui transaction could have prompted PE to act. An offer at book value would imply HK$2.50, a 40% premium to the last close price. 

• Hypermarket reshuffles as JD.com (9618 HK) and DFI Retail (DFI SP) exit Yonghui Superstores (601933 CH); and Alibaba Group  (9988 HK) potentially exits Sun Art Retail (6808 HK).
• Evidently the influence of a younger hip third-generation tycoon-scion wasn’t the panacea for New World Development (17 HK) and its ongoing issues in the HK/China property space.
• MBK bumps the Tender Offer prices for Korea Zinc (010130 KS) by 13.6% to ₩750,000 and Young Poong Precision (036560 KS) by 25% to ₩25,000. What with the Choi’s do?

• Catur Sentosa Adiprana (CSAP IJ) has grown rapidly from a building material distribution company into the leading retailer in building materials and home improvement through Mitra10 and shop-in-shop Atria. 
• The company already has 52 Mitra10 superstores in Indonesia, with six distribution centres across the country, selling a range of home decoration products, with an increasing portion of private labels.
• CSAP has seen a market improvement in margins for Mitra10 through more private label and scale benefits, and margins will continue to improve. Valuations are attractive with earnings growth accelerating. 

• International Game Technology (IGT) has reported its Q2 2024 earnings, showing strong performance in both revenue and operational metrics.
• In its second quarter, IGT generated revenue of $1.05 billion, maintaining levels similar to the prior year, and achieved an operating income of $230 million.
• When excluding one-time separation and divestiture costs of $26 million, the operating income margin impressively improved by 40 basis points to 24.4%.

• Conagra Brands, in their Q4 and Fiscal Year 2024 earnings, presented a mixed set of results reflecting a transitional phase in consumer purchasing behavior and pricing adaptation.
• CEO Sean Connolly emphasized the gradual normalization of the operating environment as consumers adjust to new price benchmarks, a process he described as ongoing rather than immediate.
• 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.

• Outbound & domestic travel activity continued to recover nicely in August
• Initial reports suggest Mid-Autumn Festival travel activity was solid, too
• After recent surge, we’ve cut Trip.com to HOLD; check out airlines instead

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
We assess Bubbles Group’s ESG as “Adequate”, in line with its Social and Governance scores, while the Environmental score is “Weak”. Controversies are “Immaterial” but Disclosure is “Weak”.

• Alibaba Group Holding (9988 HK)-backed hypermarket play Sun Art Retail (6808) is currently suspended pursuant to the Takeovers Code.
• Reportedly, SASAC-backed COFCO Group may acquire Alibaba’s 78.7% stake. Sun Art’s shares are up 45% since the middle of the month.
• Alibaba exiting – if true – follows JD.com (9618 HK) (and DFI Retail Group Holdings (DFI SP)) selling their respective stakes in Yonghui Superstores Co., (601933 CH) earlier this week.

• Swiggy (1255298D IN) , a popular food and grocery delivery platform in India, plans to launch its much-anticipated IPO in early November.
• The company has seen rapid growth in Gross Order Value and revenues, driven by increased food delivery demand and a surge in quick commerce, an on demand grocery delivery service.
• The Naspers and Softbank Group (9984 JP)  backed company that started operations in 2014 is yet to turn profitable while its close competitor Zomato reported profits in FY2024.

• LFX is a heritage jewelry retailer with almost 180 years of history, traded on the Shanghai Stock Exchange
• A shares trade at around 14-15x TTM earnings with a 3% yield, while B shares trade at a significant discount of 5x TTM earnings and a 7% yield
• Opportunity for investors to own stake in a growing business with strong returns on capital and conservative management at a discounted price, due to lack of attention to the B share class.

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.

• Tesla projects Q3 2024 EV sales of 460,000–470,000, reflecting 8% YoY growth, driven by high demand in China and robust Gigafactory operations. 
• The October 10 Robotaxi event will spotlight Tesla’s Full Self Driving tech, attracting intense investor interest in autonomous transportation’s future prospects. Investors eye a new cheaper Tesla model release.
• Waymo leads the U.S. market, with 100,000+ weekly paid robotaxi trips, intensifying pressure on Tesla to match or surpass this scale in its robotaxi rollout. 

Lucror Analytics Weekly Wraps provide an overview of all Morning Views comments and reports published by our analyst team in the past week, and also showcase a list of the most-read reports.

In this Insight:

1. Vedanta Resources
2. Meituan
3. Yankuang Energy Group
4. Genting Bhd
5. Delhi International Airport Limited

and more…

• Since the total shares held by Founder Family, trust Banks and FamilyMart exceed 50%, this director appointment proposal will pass unless the shareholders held by the trust banks oppose it.
• Challenges will be noted in the function of the nominating committee, which nominated directors with few elements falling under the skills item, and in the disclosure of the skills matrix.
• While PPIH’s free cash flow is ample and growth is expected, shareholder returns and governance remain challenges, but with overseas investor equity exceeding 30%, much improvement is expected in future.

• Hong Kong is now the top-performing major world market this year.  With a large valuation disparity, both Hong Kong’s and China’s markets have more upside potential.
• Haidilao International Holding (6862 HK) and Anta Sports Products (2020 HK) are benefiting from the improvement in consumer sentiment with government stimulus targeting housing payments and consumption.
• Citic Securities (H) (6030 HK) surged in anticipation of increased market trading and IPOs.  Industry consolidation is also part of the improved sentiment.

• Volkswagen AG’s China joint venture (JV) with state-owned SAIC Motor Corp. Ltd. (600104.SH +2.57%) is considering shutting down a combustion engine car plant in Nanjing as it accelerates its pivot toward electrification in the world’s largest auto market where demand for fossil fuel powered vehicles is weakening.

• The move would be part of efforts by SAIC Volkswagen Automotive Co. Ltd. to “upgrade and optimize” its carmaking capacity as it joins other automakers in increasingly focusing on producing electric smart vehicles in China, the JV told Caixin on Saturday.

• The plant in Nanjing, the capital of East China’s Jiangsu province, is where the JV produces the conventionally powered Passat, one of its flagship models. It is one of SAIC Volkswagen’s eight manufacturing facilities in the country.

• SunCar Technology Group ((NASDAQ: SDA) is a leading Chinese cloud-based provider of digital enterprise auto services and auto eInsurance services in China.
• The company offers one-stop, fully digital, on-demand automotive service systems to help enterprise clients build up their customer base and serve their end customers (auto owners).
• The company has grown revenues rapidly in recent years, which we expect to continue in the near-to-midterm.

• On Tuesday, China announced fresh stimulus measures targeting the stock market and property sector.
• The PBoC reduced the main policy rate and cut the RRR, signaling that further cuts were on the cards for later this year.
• Further stimulus measures were announced today ahead of the Golden Week holiday. The discounts of Naspers and Prosus have rallied on the news, we see room for further upside.

• This is a short follow-up on HK-Listed Apparel & Footwear Screener: Right Stocks Listed in the Wrong Market – Attractive Yield & Rapid Expansion Outside China – Sep 2024 
• To make the list more comprehensive, we added JNBY Design Ltd (3306 HK), which trades at 8x PE, has a 9% dividend yield, and is net cash.
• We also have updates from Crystal International’s (2232 HK) interim report, which has a very positive future outlook. 

• Mr. DIY Holding (Thailand) (2472516D TB)  is looking to raise as much as US$300m in its upcoming IPO in Thailand.
• It is the largest home improvement retailer in Thailand offering value prices i.e. “Always Low Prices” for over 15,000 products across a variety of departments. 
• In this note, we look at the firm’s past performance.

• Smartworks Coworking Spaces Ltd (1742134D IN) is looking to raise about US$120m in its India IPO.
• It is an office experience and managed campus platform, typically focused on leasing entire/large, bare shell properties in prime locations and transforming them into fully serviced, tech-enabled campuses with amenities.
• In this note, we talk about the company’s historical performance.

• Last week Friday, JSE indices were rebalanced in the closing auction. Turnover for the day was R53.7bn, R37bn traded in the closing auction (68%).
• Turnover at the June rebalance was R58bn, 66% traded in the closing auction.
• Foreign activity in MRP on Friday suggests that there was a large buyer, despite muted index weight changes.

• Volkswagen, an iconic symbol of German industry, is facing unprecedented challenges with potential factory closures
• The Volkswagen brand, which produces half of the cars for the entire Volkswagen Group, is struggling with high costs and low profit margins
• The potential layoffs and factory closures could have significant impacts on both Germany’s economy and its national identity as an industrial giant

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

• RPSGV reported a decent Q1FY25 with FMCG business sustaining an annualized revenue run-rate of INR 500cr+. The Sports business also reported healthy Q1FY25 revenue (INR 500cr+) led by IPL contribution.
• To add to growth aggression, RPSGV announced a new CEO for the FMCG business in August. Mr. Sudhir Langer, an accomplished FMCG professional, took the baton from Mr. Rajeev Khandelwal.
• At the current valuation, RPSGV is available at a holding company discount of 75%+. As the scalability potential of the FMCG and Sports businesses become evident, significant re-rating could happen.

• Q3 is coming to an end and ADEA has yet to announce new licensing deals its management has been asserting would happen this year. 
• ADEA has maintained a revenue forecast of $380 million to $420 million on the expectation there would be at least two major new licenses announced this year.   
• Our earning model currently calls for ADEA to generate $400 million in revenue with the third quarter being a smaller step up in revenue compared to the fourth quarter.

• We are reiterating our Buy rating, $3 price target and projections for Vince Holding after visiting the company’s store in London and reviewing Vince’s wholesale offering with leading department stores.
• We continue to believe Europe, and especially the United Kingdom, remain key growth opportunities for Vince, as their fashion aesthetic and pricing are ideal to capture market share in Europe.
• Further, we believe, even with their limited current reach, Vince is already beginning to cultivate a very loyal local customer base that considers the product part of their overall lifestyle.