Consumer

• In May when shares were trading near ¥3,500-3,600, Toyota announced a ¥1trln buyback. When shares fell, they announced a Tender Offer Buyback at a large discount (¥2,781/share). 
• Subsequently, the shares fell very sharply on Thursday 1 August, then again Friday and yesterday. That put shares WELL below the Tender Offer Price. That creates possible opportunity. 
• This insight discusses modalities (talk to your advisor for specific advice/info) who might do what and why. It sets parameters. But I think Toyota is cheap here.

• Kirin Holdings (2503 JP) has increased the Fancl Corp (4921 JP) tender offer price by 4.1% to JPY2,800 and extended the offer period to 28 August. The price is final.
• Kirin tried to get the required acceptances by refusing to bump and extending the offer period. However, these tactics failed, as the shares continued to trade above terms.
• The Board twice asked Kirin to raise its offer higher than JPY2,800, but eventually recommended the revised offer. Nevertheless, the bump should be sufficient for Kirin to succeed. 

• July saw only 114,000 new jobs versus a forecast of 180,000. Unemployment rose to 4.3%, the highest since October 2021. 
• The S&P 500 fell 1.8% and dropped below its 50-day moving average, tech and semiconductor sectors led significant market declines. 
• Implied volatility surged as the S&P 500 saw high put options activity. Analysts expect a potential market rebound later in August.

• Sapporo Holdings (2501 JP)‘s strategic position in the domestic market, coupled with untapped potential in international markets, makes the company an interesting prospect for the long-term.
• 3D Investment Partners’ July 2024 letter praising Sapporo’s intention to divest its real estate business has reignited investor interest in Sapporo as a play focusing on Japan’s investor activism.
• Therefore, Sapporo seems interesting both in the short term and long term, as we think shares could break out to a new high with trading volumes showing signs of improvement.

• Eternal Beauty Holdings Limited (EBHL12 HK) is looking to raise about US$200m in its upcoming Hong Kong IPO. The deal will be run by BNP Paribas, Citic, CMBI and DBS.
• Eternal Beauty is the largest brand management company of perfumes in the combined markets of Mainland China, Hong Kong and Macau, in terms of retail sales in 2023.
• The company has a diverse portfolio of iconic brands of not only perfumes, but also color cosmetics, skincare products, personal care products, eyewear and home fragrances under management.

• The cost is somewhat reduced for the user because of the higher weighting of more liquid stocks. Meanwhile, selling pressure is inevitable for less liquid companies whose weights are reduced.
• Even if the number of stocks decreases, 1,200 stocks isn’t small number. Also, even though the market capitalization of the components has increased, approximately 73 billion yen isn’t sufficiently liquid.
• With calls for increased engagement, the number of issues remains too large for domestic asset managers, where passive funds account for a high percentage of AUM.

• We maintain our Outperform recommendation on MercadoLibre with a preference for MELI 2.375% 2026 bonds. We remain optimistic about the company’s overall financial and business risks.
• Revenues increased by 41.5% (FX-neutral: 113%) to $5.1 billion in 2Q24. However, the EBIT margin contracted significantly by 440 bps to 14.3% from 18.7%.
• MELI ended the quarter with $976mn in net debt, down from $1.4 bn sequentially. Gross leverage remained relatively stable at 1.8x, and net leverage improved by 0.2x sequentially to 0.3x.  

• China Resources Beverage is looking to raise 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 note, we talked about the company’s past performance. In this note, we will undertake a peer comparison.

• We are slowly building out 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), DigiPlus Interactive (PLUS PM). We will also be exploring Centro Escolar University (CEU PM) 

• In FY03/24, revenue was JPY60.2bn (+10.5% YoY), operating profit was JPY2.2bn (operating loss of JPY607mn in FY03/23), recurring profit was JPY2.2bn (recurring loss of JPY669mn), and net income attributable to owners of the parent was JPY1.8bn (net loss of JPY1.5bn).
• Revenue and profits grew YoY.
• Contributing factors included the normalization of social and economic activities as the pandemic’s impact tapered off, the increase in customer count thanks to various marketing efforts, and various measures aimed at profitability improvement.

• Today, Itochu Corp (8001 JP) announced it would launch a Tender Offer when approvals were received, to buy out minorities in Descente Ltd (8114 JP) at ¥4,350/share.
• Itochu was buying at that price or higher, in the market, in October 2023. Earnings and book are up since then. Outlook for the Descente China Holdings affiliate? Great. 
• The valuation transparency is disappointing. Activists would have 3mos or so to push for more. But with friendly holders, they get very close to the minimum anyway.

• Descente Ltd (8114 JP) has recommended a pre-conditional tender offer from Itochu Corp (8001 JP) at JPY4,350, 16.6% premium to the undisturbed price. 
• The pre-condition is approval under the competition laws of Japan and China. The offer is anticipated to commence in early November. In January 2019, Itochu completed a hostile partial offer.
• While the offer is attractive vs peer multiples, it is light vs historical trading ranges. Securing the required acceptance rate could prove challenging as the price is light. 

• Adani Enterprises (ADE IN) demerged its stake in its Food FMCG business of Adani Wilmar (AWLTD IN) to its shareholder.
• The demerger aims to comply with SEBI’s minimum public shareholding requirement, reducing promoter stake and enhancing public stake.
• This strategic move positions Adani Wilmar for focused growth, unlocking value for shareholders and reducing promoter selling pressure.

• In July, BYD’s deliveries increased by 31% YoY and Tesla’s deliveries in mainland China increased by 47% YoY.
• Alibaba Taobao will soften its “refund only” rule, but Alibaba Hellobike raised its usage price.
• New Oriental revenue increased by 32% YoY and TAL revenue increased by 50% YoY in the May quarter.

• Ola Electric (1700674D IN) plans to raise INR55bn through fresh issue of shares while existing shareholders will offer 84.9m shares at an indicative IPO price band of INR72-76 per share.
• We expect the company’s revenues to continue to expand and grow at much higher rates during the next few years compared to competitors in the Indian two-wheeler market.
• Our valuation analysis suggests that Ola Electric’s IPO is attractively priced compared to peers and we would suggest subscribing for the company’s IPO.

• China ETF flows were steady for the week, however Southbound Connect flows were negative for the first time since February.
• Prada S.P.A. (1913 HK)  shares standout in the luxury brand sector as Miu Miu sales surged.  WuXi AppTec (2359 HK) slightly beat estimates but still have BioSecure Act overhang.
• Property development firms Hang Lung Properties (101 HK) and Wharf Holdings (4 HK) were hurt by poor results, while New Oriental Education & Techn (9901 HK) saw earnings miss estimates.

• In an attempt to cover more companies, we shift gears from individual companies to sectoral analysis, focusing on alcoholic beverages in this insight.
• Companies in focus are United Spirits (UNSP IN), Radico Khaitan (RDCK IN) , Sula Vineyards (SULA IN) & United Breweries (UBBL IN). 
• UNSP remains the best among the pack in terms of earnings quality, and SULA occupies the other extreme. RDCK is chasing growth, and UBBL is facing challenges. 

• MDL Wholesale (WMHGCZ CH) is looking to raise about US$100m in its upcoming Hong Kong IPO. The deal will be run by UBS, CMS, CMBI, Deutsche Bank, BOCI, and China Galaxy.
• MDL Wholesale is a leading food and FMCG distribution solution provider in China, providing a broad range of customers and retailers with high-quality merchandise and convenient solutions
• Its solutions mainly include (i) food service and distribution, (ii) welfare and gifting, (iii) retailer distribution (comprising product sales to retailers and supply chain services) and (iv) merchandise wholesale. 

• Multi Bintang Indonesia (MLBI IJ) reported Q2 2024 revenues/profits of -4.4%/-5.4% YoY. Q2 FY24 was a significant improvement over Q1 FY24, when revenues were down 10.7% YoY.
• The company is controlling costs by keeping SG&A down by 100 bps to maintain EBITDA margins over 50%. Net cash is now at 8% of the market capitalization.
• We believe that the company will be able to pay 500/Rph of dividends in FY24, implying an 8.3% dividend yield. Trading at 12x PE, we find this idea compelling.

• Kalyan Jewellers (KALYANKJ IN) reported strong 1Q2025 sales and earnings growth, driven by robust same-store sales growth (SSSG) and new store additions.
• Titan Co Ltd (TTAN IN), the incumbent market leader, had a lacklustre performance for the quarter, highlighting Kalyan’s rapid growth.
• Expect Kalyan Jewellers (KALYANKJ IN) to outperform Titan Co Ltd (TTAN IN) , narrowing the steep relative valuation discount as it ramps up growth, improves performance metrics.

• Sumitomo Forestry (1911 JP) is a potential inclusion to a global index at the August rebalance. If added, passive trackers will need to buy over 6x ADV.
• Sumitomo Forestry (1911 JP) has traded lower on risk-off sentiment and further downside provides an entry point that could pay off if the stock is added to the index.
• Sumitomo Forestry (1911 JP) has outperformed its peers but trades at similar valuations to some stocks. A long/short trade could protect the downside.

• In this insight, we provide an update of KT&G Corporation (033780 KS) which is a strong candidate for outperformance amid increased signs of market fears. 
• We continue to believe that there is an increasing probability of cigarette price hikes in Korea in 2H24. Last time that KT&G hiked its cigarette prices was in January 2015.
• The company’s shareholder return policy is to provide cash dividends of 1.8 trillion won and share buyback/cancellations worth 1 trillion won from 2024 to 2026. 

• Aequitas Research’s weekly update on the IPOs, placements, lockup expiry and other ECM linked events that were covered by the team over the past week.
• On the IPO front, the coming week will see see the listing of Akums Drugs while books will  be open for Ola Electric, BrainBees Solutions and Black Sesame Technologies.
• On the placement front, there were two large deals in Fortescue Metals (FMG AU) and Adani Transmission (ADANIT IN). 

• BrainBees Solutions (0172540D IN), India’s largest multi-channel retailing platform for mothers’, babies’ and kids’ products, will launch an IPO to raise up to US$500 million.
• We previously discussed the IPO in Brainbees Solutions (FirstCry) IPO: The Bull Case, Brainbees Solutions (FirstCry) IPO: The Bear Case and Brainbees Solutions (FirstCry) IPO: The Investment Case.
• Our valuation analysis suggests that the IPO price range of Rs440-465 per share is attractive. Therefore, we would participate in the IPO.

• ADM’s Q2 results underperformed analyst expectations with both EPS and revenue missing analyst estimates.
• Operating profit declined for Ag Services & Oilseeds (ASO) and Nutrition, while Carbohydrate Solutions saw an uptick, driven by margin and volume expansion in Starches and Sweeteners.
• ADM expects weak Q3 for AS&O and Carbohydrate Solutions, with improvements expected in H2 2024. Nutrition is expected to perform strongly due to cost efficiency and volume expansion.

• Strong recovery in 1H2024 profit growth YoY was driven by margin improvements in the food and convenience segments.
• Double-Digit sales growth in the Ready-to-Eat (RTE) foods segment boosted margins, offsetting reduced cigarette volumes from last year’s tax increases in Hong Kong.
• While weak consumer confidence in North Asia impacted sales, good growth in the expanding Southeast Asia business provided a positive offset.

• Sustainable management should be considered in the sustainable expansion of corporate value, including shareholders’ interest, and non-financial information should provide direction based on information that isn’t feasible, including financial information.
• Starting with appointing people who are diverse in nationality and gender to the board of directors will lead to discussing management issues with diverse opinions.
• Significant differences exist between those companies that have improved their efforts to improve board practices and capital profitability and achieved results, and those that have only formally put board practices.

• After a warm-up week of swimming, rowing and archery, the Olympics now kicks into top gear with the athletics.
• Among the hottest of track and field gold medal prospects is Armand ‘Mondo’ Duplantis of Sweden.
• On Monday evening, the 24-year-old will contest the men’s pole vault final as the defending champion from Tokyo. 

• Ferrari N.V. (RACE US) reported another strong Q2 2024, with revenues up 16% and profits up 25% YoY. EBITDA margins expanded to 39% due to pricing/personalization(20%). 
• The company raised its guidance on revenue/EPS by 2.3%/5%, flagging Q3 would be weak as it transitions to its new ERP, but we believe the company is being conservative. 
• Trading at 48.7x FY24e, the stock seems a tad expensive, but it’s up 28% YTD because of upgrades, which we believe will continue. 

• North Dakota accounts for 51% of total US spring wheat production. The region’s projected 2024 crop yield 15% higher YoY at an average of 54.5 bushels per acre.
• Large old-crop corn inventories record yield of 183-185 bpa collectively dragging corn prices down.
• Wheat vols rebounded last week after falling the prior week. Prices face uncertainty as strong exports, lower production in EU & China provides support against massive US harvest.

• I tally 45 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
• Quite week – no new deals were discussed this week on Smartkarma ….
• Key updates took place on Ansarada Group (AND AU), Southern Cross Gold (SXG AU), A8 New Media (800 HK), CPMC Holdings (906 HK), Mandala Multifinance (MFIN IJ), and Fancl (4921 JP).

• A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
• ECM developments: Ola Electric (1700674D IN) and BrainBees Solutions (0172540D IN) IPOs.
• Event-Driven developments: A8 New Media (800 HK), Asia Cement China (743 HK), CPMC Holdings (906 HK), Fancl Corp (4921 JP), Sun Corp (6736 JP), Pacific Metals (5541 JP). 

• BrainBees Solutions is looking to raise up to US$500m in its upcoming India IPO.
• FirstCry is India’s largest multi-channel retailing platform for Mothers’, Babies’ and Kids’ products in terms of GMV, for the year ending Dec 2022 (9M23), according to RedSeer.
• In our previous notes, we looked at the company’s past performance. In this note, we will talk about valuations.

• Ola Electric (1700674D IN) is launching its IPO, consisting of fresh issue worth INR 5.5 bn and offer for sale upto 84.9 mn shares.
• The company delivered its first electric scooter in December 2021, and since then it has grown immensely to become a market leader with a share of 35%.
• As far as forensics go, one should look out for related party transactions with promoters, some accounting policies, constant losses, need for capex, trend of expenses, etc.

• Signs of change in companies that have improved their capital profitability and valuations can be seen in their policy shareholdings/total assets. 
• Companies with fewer policy shareholdings, as measured by (policy shareholdings + equity holdings)/total assets, tend to have the best values for valuation, ROE, and ROA, and vice versa.
• To measure the seriousness of reducing cross-shareholdings, as long as the company has the voting right of cross-shareholdings in retirement benefit trust, the deemed shares should be included in cross-shareholdings.

• Ford Motor Company’s second quarter 2024 performance offers a comprehensive snapshot of a transitional phase in the company’s long-standing history.
• The quarter reflects their advancing Ford+ strategic plan which aims to refine operational efficiencies and bolster profit margins through structural adaptations and technological advancements.
• 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.

• O’Reilly Automotive, Inc. faced a challenging second quarter in 2024, with performance below expectations due to broader industry demand headwinds.
• Despite these challenges, the company reported a 2.3% increase in comparable store sales, continuing to outperform the industry.
• Adjustments in full-year outlook for operating profit and earnings per share were made following these results.

• Whirlpool Corporation reported its second quarter earnings for 2024, reflecting a mixed performance amid a challenging macroeconomic environment.
• The company showed strong sequential global margin expansion and reiterated its net sales guidance at $16.9 billion.
• However, it faced downward pressure on discretionary demand due to the soft housing market, particularly affecting the North American market.

• Sales rose JPY1.8bn (8.3%) YoY, driven by higher sales in Domestic Rice Cracker, Overseas, and Food businesses.
• Operating profit increased JPY375mn (53.6%) YoY, with significant profit growth in Domestic Rice Cracker and Food businesses.
• Revised FY03/25 forecast projects sales of JPY102.0bn (+6.8% YoY) and net income of JPY3.8bn (+68.4% YoY).

• U.K.-based food distributor specializing in delivering a variety of products to convenience stores and foodservice providers
• Targets independent establishments with low minimum order values
• National scale gives them bargaining power over suppliers, providing a competitive edge

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.

• In late May, Toyota Group member Aisin (7259 JP) announced it would sell its 37% stake in Exedy Corp (7278 JP). The market dropped. But that was an opportunity. 
• There was an announcement, a ToSTNeT-3 buyback, the offering, and more buyback to come. On 30 May, I said “Buy the deal, buy in the market. It’s cheap and vulnerable.”
• Exedy is up 21% since. On 17 June, activist Murakami-san’s group went over 5%. Then they bought more. Now they have 15%. Or more. Still cheap. Still vulnerable. 

• BrainBees Solutions is looking to raise up to US$500m in its upcoming India IPO. 
• FirstCry is India’s largest multi-channel retailing platform for Mothers’, Babies’ and Kids’ products in terms of GMV, for the year ending Dec 2022 (9M23), according to RedSeer.
• We have looked at the company’s past performance in our previous notes. In this note, we will talk about its updated financials in the RHP.

• Ola Electric (1700674D IN) ‘s IPO appears attractive versus peers based on valuation analysis, supported by detailed sales and revenue projections.  
• Expect strong near-term revenue growth driven by its dominant market presence, e-mobility expansion, and potential entry into the e-motorcycle segment.
• With a significant head start in the rapidly growing e2W sector, Ola’s robust product lineup, competitive pricing, and strong brand make it a compelling EV play.

• BrainBees Solutions (0172540D IN), India’s largest multi-channel retailing platform for mothers’, babies’ and kids’ products, will launch an IPO to raise up to US$500 million.
• We previously discussed the IPO in Brainbees Solutions (FirstCry) IPO: The Bull Case and Brainbees Solutions (FirstCry) IPO: The Bear Case. In this note, we examine the RHP update.
• The RHP shows that positives (KPIs heading in the right direction, margin improvement, lower cash burn) offset the negatives (declining organic growth and deteriorating balance sheet).    

• CyberAgent Inc (4751 JP)  reported 3QFY09/24 results yesterday. Both revenue and OP grew YoY, while revenue beat consensus marginally, OP beat consensus by a huge margin.
• All three business segments showed strong recovery with notable improvement in gaming business as newly released titles perform well including the newly released UMA MUSUME: Pretty Derby movie.
• Media business reported OP for the second consecutive quarter and the company has plans to further strengthen monetisation around AbemaTV.

• Budweiser Brewing APAC (1876 HK)‘s  performance could improve from 2H2024, driven by a likely recovery in China’s premium beer market and favourable commodity prices.
• Stock’s upside potential from current price levels seem to outweigh downside risk.
• With a high dividend payout and strong free cash flow generation, Budweiser trades at a 5% dividend yield and an 11% FCF yield.

• Company issued 1H24 profit alert after market yesterday which significantly beat even the high-end sell-side expectations. 
• Impressive SSSG and store-level unit economics imply sizable potential for operating leverage and earnings growth in the mid to long term.
• The profit alert, along with 2Q operating data released earlier, reinforced our confidence in earnings estimates of RMB130 million/RMB300 million for FY24/25 respectively. 

• Luckin’s SSSG declined 20.9%YoY in the peak season, indicating diseconomies of scale for Luckin and a deteriorated competitive environment. We do not expect a quick turnaround in the near term.
• We think Luckin has limited capability to further raise its prices in 3Q24, and expect its NPM to be 11.9%/7.1% in 3Q24/4Q24 as the new norm.
• We keep SELL rating and lower TP to US$16.5/ADS. The stock trading at 20x/16x PE in 2024/2025, and we expect the NI to increase 15%CAGR in the next 2 years.

• Danish jewelry company specializing in customizable charm bracelets
• Over 70% of business comes from charms, with prices ranging from £20 to £500
• Vertically integrated with production facilities in Thailand and Vietnam, shifting towards retail-heavy distribution and expanding into lab-grown diamonds market; primarily catering to women customers.

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.

• DigiPlus Interactive (PLUS PM) is the Philippines platform for Bingo Plus and other e-casino games, trading at 7x in the midst of >100% growth in revenue/profitability in 2024. 
• The company is net cash with a >50% ROE and is in an industry forecast by PAGCOR (regulator) to grow at least 15% CAGR in the future years.
• We expect explosive Q2 revenue/profit growth of 226%/298% YoY which would act as a share price catalyst. We calculate a dividend of 0.80-1 peso/share (30-40% payout ratio), equating to a 4-5% yield.

• The Sep 2024 Nikkei 225 Review base date is here. As before, I see one ADD, one DELETE, one capping, and one Very Dark Horse.
• The rules are clear, but not. This causes confusion. There may be unwritten rules keeping the Very Dark Horse out til next time.
• The Nikkei Index Team announced Fast Retailing (9983 JP) would be capped. I didn’t expect that now. That means $2.2bn+ of selling 30Sep and a reverse funding trade.

• On 10 June, Sun Corp subsidiary Cellebrite DI (CLBT US)‘s SPAC sponsor True Wind Capital launched a Tender Offer for 19% of SunCorp at a premium but discount to NAV.
• The price was too low. CLBT shares rose. They lifted the TOB price by 8% to ¥4750. Still too low. It was trading there. Now they have lifted to ¥5500.
• Now a 49% premium to undisturbed, 29.4% premium to all-time high prior to the first tender. Changes in terms means this could get done. More bullish than it looks.

• True Wind has increased its partial offer for Sun Corp (6736 JP) to JPY5,500 and materially lowered the minimum number of shares to be purchased from 3.3m to 1.1m.  
• True Wind’s previous two offers were a non-starter due to an unattractive price and an onerous minimum acceptance threshold. The final offer addresses both these issues. 
• The offer will succeed due to the low minimum acceptance threshold and the 25% price uplift vs. the 19% value increase in the Cellebrite stake (since the offer announcement).

• Ola Electric is a vertically integrated pure EV player in India with both technology and manufacturing capabilities for EVs and EV components (including battery packs, motors and vehicle frames).
• The company’s much awaited IPO is opening for subscription on Friday, and this insight focuses on new data points from the company’s latest Red Herring document (RHD).
• Our analysis shows that the company’s top line has continued to expand driven by volume while there has been significant reduction in operating losses in FY03/2024.

• We discuss the end of the mandatory lock-up periods for 41 stocks in Korea in August 2024, among which 2 are in KOSPI and 39 are in KOSDAQ.
• These 41 stocks on average could be subject to further selling pressures in August and could underperform relative to the market.
• The top three market cap stocks including those of which at least 1% of outstanding shares could be sold in August include APR, Fadu, and Kuk Il Paper.

• Today’s news indicates Hankook Tire found contingent liabilities in Hanon Systems’ finances, meeting conditions to break the May agreement and putting the deal on indefinite hold.
• Hankook Tire plans to adjust the new share price first, then the existing share price, while Hahn & Co, unable to delay its exit, will likely accept it.
• With Hahn & Co likely to accept Hankook Tire’s price adjustment request, consider a long-short setup: Hankook Tire may benefit from positive momentum, while Hanon Systems faces negative dilution.

• Samsonite is a global luggage leader with three major brands: Samsonite, Tumi, and American Tourister
• Despite challenges during COVID, Samsonite has successfully executed a turnaround by closing stores and improving sales and margins
• The stock is undervalued in Hong Kong, with plans for a secondary US or European listing in the near future, potentially offering a 100% upside opportunity.

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

• India’s electric 2-wheeler sales nosedived after March 2024 as the government reduced incentives.
• The price gap between electric 2-wheelers and their ICE counterparts has widened significantly with lower incentives.
• Despite the overall slowdown, Ola Electric (1700674D IN) ‘s steep market share rise highlights its product prowess, competitive pricing capabilities, and strong brand.

• One of the biggest stories in the Korean e-commerce sector this week has been TMON and WeMakePrice filing for court receivership due to liquidity crisis. 
• Singapore’s Qoo10 is the controlling shareholder of TMON and WeMakePrice. Young-Bae Ku is the largest shareholder of Qoo10 with a 42.77% stake, followed by KKR with a 25.65% stake. 
• Competitors such as E-Mart and Coupang are most to benefit. PG companies such as KG Inicis and NHP KCP are negatively impacted. 

• We compile a list of ten high-yielding/net cash or low-net debt stocks in HK’s apparel/footwear value chain. HK is a pariah for investors, and trailing dividend yields are approaching 6-20%. 
• As in other insights, we don’t estimate future earnings for all companies, but we indicate if the company has quality by measuring long-term ROCE (average five years).
• By expanding outside of China, most of these companies have derisked themselves from the trade war ( to the extent they can) and are also ready for earnings inflection.

• Ola Electric is now looking to raise about US$730m in its upcoming India IPO.
• Ola Electric Mobility is a vertically integrated pure EV player in India with manufacturing capabilities for EVs and EV components, including cells.
• In our previous notes, we looked at the company’s performance, undertook a peer comparison and talked about valuations. In this note, we look at the updates from its recent filings.

• Earlier this month, WH Group (288 HK) announced it had submitted a plan to spin-off its Smithfield US and Mexican ops on the NYSE or NASDAQ,
• These ops accounted for 54% of WHG’s FY23 revenue and 22.4% of the operating profit; compared to 56% and 44.9% respectively in FY22.
• We’ve been here before. A Smithfield spin-off was touted in 4Q23 (in the media). WHG acquired Smithfield for US$4.7bn in 2013, ahead of its 2014 listing. 

• Ola Electric (1700674D IN), the largest Indian player in electric two-wheel vehicles (E2W), is seeking to raise up to US$734 million. 
• We previously discussed the IPO in Ola Electric IPO: The Bull Case, Ola Electric IPO: The Bear Case and Ola Electric IPO: The Investment Case. 
• Our valuation analysis suggests that the IPO price range of Rs72-76 per share is attractive. Therefore, we would participate in the IPO.

• We screen for stocks at the extreme ends of their positioning or momentum ranges among active Emerging Market equity funds.
• High Positioning, Negative Momentum: BYD Company Limited Class H, Novatek Microelectronics Corp.
• Low Positioning, Negative Momentum: Banco Bradesco SA Pfd, LG Chem Ltd.    

• Shimano’s Q2 results exceeded expectations with revenue and operating profit significantly beating estimates despite a YoY decline.
• Full-Year revenue and operating profit guidance were revised upward, reflecting improved performance and aligning with analyst consensus.
• Our estimate for FY25 was significantly raised; despite full valuations, further recovery and potential shareholder returns offer continued bullish outlook.

• Inflation is encouraging customers to seek out discount chains, led by PPI’s Don Quijote. 
• Backed by expansion of private brand lines and more food lines, as well as higher sales to tourists, PPI has been posting record results.
• There continues to be high expectations for further growth at home and abroad.

• Tesla is a polarizing company with both enthusiastic supporters and skeptical critics.
• The company has the potential to become the most valuable in the world if it solves autonomous transportation.
• The debate around Tesla is focused on its Full Self Driving software, which has recently transitioned to a neural net architecture and is best experienced firsthand at a Tesla delivery center.

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.

• Ola Electric is now looking to raise about US$730m in its India IPO.
• Ola Electric Mobility is a vertically integrated pure EV player in India with manufacturing capabilities for EVs and EV components, including cells.
• In our previous notes, we looked at the company’s past performance. In this note, we will talk about valuations.

• Companies that have increased their valuations over the past year are those with higher valuations and have further increased their ROE and ROA, resulting in even higher valuations.
• The difference between the characteristics of companies whose valuations increased and those whose valuations did not change over the past year is the foreign ownership ratio.
• Companies with low foreign ownership have less access to overseas investors’ suggestions for solving individual company problems, which is why they are slow to act to improve capital profitability.

• V-Mart Retail (VMART IN)  is an omni-channel value retailer, providing a range of products aimed at Bharat’s middle and lower middle class
• The company has implemented a cluster strategy that has supported its expansion across India. In FY24, V-Mart opened 46 new stores nationwide.
• Being over-indexed to value, V-MART has posted slower revenue growth compared to the recent past. New Warehouse and tigher control over inventory could boost cashflows further. 

• The Kirin Holdings (2503 JP) Tender Offer to buy out minorities in Fancl Corp (4921 JP) closes today. Or at least the current one does. 
• The original deal announced was light, and the stock has traded above terms since the announcement, with one fund buying up to 7.94%.
• I expect Kirin to extend and bump next week, or bump/extend now, depending on their visibility on Fancl Q1. 

• Today after the close Stanley Electric (6923 JP) announced a salutary Q1 result which was “ahead of in-line” in most metrics towards unchanged H1 and FY guidance. 
• The company also announced a BIG on-market buyback at 8.1% of shares out, to be bought back with a delayed start over the 7.5mos starting 13 August.
• At last price, the buyback is ~10mm shares. The details are interesting and are worth a look. 

• Back on the 18th, the Sirivadhanabhakdi family-backed Thai Beverage (THBEV SP) announced it would swap its 28.78% stake in Frasers Property Ltd (FPL SP) with THBEV-affiliate TCC Assets.
• Under the agreement, TCC will transfer a 41.3% stake in food and beverage play Fraser And Neave (FNN SP) to THBEV, lifting THBEV’s holding to 69.61% from 28.31% currently.
• The share swap triggers no Offers for either F&N or FPL. THBEV says it has no plans to privatise F&N  … at the moment.

• The Ola Electric (1700674D IN) IPO will see the company and existing shareholders sell 808.6m shares at a price range of INR72-76/share, valuing the company between US$3.79bn-US$4bn.
• Ola Electric (1700674D IN) will have a float of around 10% at the time of listing and that will increase to around 20% after the lock-up on anchor investors ends.
• Ola Electric (1700674D IN) could be added to global indices in February and March 2025, but inclusion in local indices with meaningful tracking assets will take longer.

• One of the important factors of big changes at the Korean chaebols is the age factor of the chairman/honorary chairman of each of these conglomerates.
• In this insight, we provide the shareholding ownerships and ages of the top 10 Korean conglomerates where age could become a major factor in impacting big changes that could occur.
• Among the 10 conglomerates listed below, Hyundai Motor Group, Celltrion Group, and SK Group have shown greater willingness to improve their shareholder return policies.

• We visited convenience stores to look for China Resources Beverage products.
• The company is in a price war with Nongfu Spring, for both drinkable water and beverages.
• Some CRB products, such as plum syrup, do not have any competitors in physical stores.

• Tesla’s stock dropped 12% post Q2 earnings, due to a 7% decrease in auto revenue, reflecting broader financial struggles despite a 15% rise in quarterly EV deliveries.
• Trump’s potential repeal of EV subsidies could reduce EV sales by 27% by 2030, but Tesla’s lower reliance on imports may mitigate the effect of increased tariffs.
• Elon Musk’s $5 billion investment in his AI startup xAI raises concerns about potential distractions from Tesla, even as he leverages political shifts to benefit Tesla.

• Low volatility investing has taken the mantle from Dividend yield as the top strategy during July
• BYD Electronics (285 HK) and Alibaba Group Holding (9988 HK) are rated BUYs as their businesses show improvement. 
• Kingdee International Software (268 HK) is seeing a softening in its SME business, however there is  potential to gain market share from foreign ERP companies given the pledged government’s policies.

• Earnings Miss: Tesla’s Q2 revenue increased by 2% to $25.5 billion, but earnings per share were 52 cents, missing the forecast of 62 cents.
• Record Revenue in Energy: Tesla achieved record revenues and profits in its energy sector, with 130% QoQ growth in energy storage deployments and regulatory credit revenues.
• Stock Reaction & Competition: Tesla’s stock dropped over 8% after-hours, influenced by increased competition, production challenges, and a notable decline in auto revenue by 7% to $19.9 billion.

• Ola Electric (1700674D IN) , India’s leading electric 2-wheeler backed by Softbank Group ‘s Vision Fund, will launch its USD 735 million IPO on Friday, August 2.
• The IPO pricing suggests a post-money equity valuation of around USD 4 billion, significantly lower than its earlier funding levels.
• Government incentives for EVs are being revised, with the current scheme valid only until the end of September, creating uncertainty that has possibly impacted valuations.

• Ola Electric (1700674D IN), the largest Indian player in electric two-wheel vehicles (E2W), will launch a US$660 million IPO at a lower US$4.5 billion valuation (vs. the previous US$7-8bn target). 
• We previously discussed the IPO in Ola Electric IPO: The Bull Case and Ola Electric IPO: The Bear Case. In this note, we examine the latest updates in the RHP. 
• The investment case rests on rising market share in a growing market, rapid growth aided by product diversification, path to profitability supported by lower losses and declining cash burn.

• Aequitas Research’s weekly update on the IPOs, placements, lockup expiry and other ECM linked events that were covered by the team over the past week.
• On the IPO front, the coming week will see Sanil Electric (062040 KS) list, while Akums Drugs and Pharmaceuticals books will open and Ola Electric too might be launched.
• On the placement front, the past week was relatively quiet after a few hectic weeks.

• Xiaomi’s shipments increased by double digits, but Apple’s shipments decreased in China in 2Q24.
• Alibaba’s Taobao and Tmall platforms have waived the AliPay fee for retailers.
• Amazon will open a store on JD.com next Black Friday.

• Prosus has become more shareholder-friendly and responsive, driven by management remuneration incentives
• The drop in discount from 2022 to 2023 was influenced by these incentives, but the lack of their extension for 2024 has led to an increase in the discount to over 40%
• Investors have an asymmetrical opportunity to benefit from Prosus’ discounted value, especially with its valuable stake in Tencent

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.

• It is very difficult to ensure the independence and transparency of a committee when the board of directors is staffed with people who are aligned with the president’s wishes.
• Companies with high ROE have superior corporate governance, due to effective overseas investor’s engagement, while companies with low ROE show unclear policies for improving ROE, despite having formalized board practice.
• To improve the effectiveness of the board, companies should appoint people to the board who will help expand the value of the company, and use engagement with overseas investors etc.

• Introduction (If you hate my story-telling, please scroll to the Background section) A lady once asked me a thought provoking question, “why have children?”
• Redirecting my gentle gaze to the ceiling and stressfully clasping a chunk of hair on the back of my head, I pondered and dug deep, with the intent of conjuring an impressive answer.
• The testosterone in me blurted, “to pass down the huge wealth I would amass some day, my children are my legacy!” and my traditional Eastern roots interrupted, “so someone would take care of me when I’m old and decrepit!”

• The updated business analysis of Kimberly-Clark reveals a mixed financial landscape rooted in strategic endeavors and market-specific challenges, which calls for a calculated evaluation for potential investors.
• During the second quarter of 2024, Kimberly-Clark underscored a strategic focus on driving volume and mix-driven gains, particularly evident in significant geographies such as the U.S., China, and the U.K. This initiative aligns with their innovation-led growth strategy aiming at revitalizing their “Powerhouse” categories, which is indicative of their proactive response to market demands and consumer preferences.
• 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.

• General Motors Company (GM) delivered a robust financial performance in the second quarter of 2024, demonstrating strong operational execution across its varied segments, enhancing confidence in its updated forecasts for the year.
• The overall sentiment from the review reflected both substantial achievements and some risks to be navigated in the future growth strategy.
• A significant positive was GM’s record revenue generation during this quarter, bolstered by a high-performing lineup of internal combustion engine (ICE) trucks and SUVs, and a growing portfolio of electric vehicles (EVs) outpacing the broader market growth.

• Comcast’s second quarter earnings call highlighted various areas of performance in the company’s operations.
• On the broadband front, despite the competitive market conditions prevalent in recent quarters, Comcast’s strategy has been consistent, focusing on generating considerable broadband revenue growth through a balance between rate and volume.
• With an established customer base of 32 million subscribers, the company is implementing market segmentation.

• The Coca-Cola Company continued its strong momentum in the second quarter.
• The company’s resilient strategy as well as its consistent focus on leveraging its scale and growth mindset have contributed to solid year-to-date results.
• As a result, Coca-Cola has raised both its top and bottom-line guidance.