Singapore

• Ninja Van is a leading Singapore-based logistics company in Southeast Asia with almost 100% last-mile courier coverage of the region. 
• The company was valued at $1.85bn based on its previous capital raise in September 2021.
• An investment in the company could offer indirect and broader exposure to Southeast Asia’s e-commerce sector since it counts most of the e-commerce players in the region as its clients.      

• An online used car marketplace in Singapore that offers full-stack services across a customer’s car ownership lifecycle.
• The company facilitated an annual run-rate GMV of ~S$1 billion (with >2 million MAUs) in 2020 and managed to earn a revenue of c. $465m in FY21.
• It reached unicorn status in the previous round of fund raise in Jun 2021 and has started preparing for an IPO internally.

• S&P revises its outlook for Singtel (ST SP) following a series of divestments. 
• Preceding my comments on Singtel are the current setup/unwind tables for Asia-Pacific Holdcos. 
• These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation >20%.

• Trax is a retail analytics company that provides digital solutions for both consumer packaged manufacturers/brands and retailers.
• The company provides a suite of AI-powered solutions that help digitize and automate the operations of the brick-and-mortar stores.
• It was valued at $2.4bn in its last capital raise and was reported to have been preparing for a US IPO for a year.

• Advance Intelligence Group provides digital commerce and financial services across Asia through its 3 key business units – Atome Financial, Advance.AI, and Ginee.
• The company was valued at >$2bn based on its latest fund raise in September 2021.
• The BNPL industry is expected to face sector headwinds, but the company is likely in a better position than other pure-play BNPL companies, thanks to its more diversified business portfolio. 

• Coda Payments provides solutions that help digital content publishers monetize their products and services.
• The company is now in >50 markets and was valued at $2.5bn based on its last capital raise in April 2022.
• With its offerings, Coda Payments is well-poised to benefit from the strong future growth in the mobile gaming sector.

• M-DAQ is an FX solutions specialist that builds OTT applications to facilitate cross-border business and transactions for various industries.
• The company was reported to have processed ~S$10bn gross transactions and raked in ~S$46m revenue in FY19.
• The company already broke-even back in 2018 and now has a solid, blue-chip shareholder base.

• Nium is a global B2B payment platform that embeds an ecosystem of financial services for its clients: Banking-as-a-Service & Crypto-as-a-Service.
• The company was valued at $2bn based on its latest capital raise and is expected to generate a run-rate revenue of $100m in 2022.
• A “payment + ecosystem/services” business model rather than just processing cross-border payments likely provides the right value proposition for users.

• Livspace brings together designers, brands, manufacturers, and contractors onto its marketplace. 
• It automates the entire process from interior design to managing last mile fulfilment for all rooms in users’ homes.
• The company was valued at $1.2bn based on its last capital raise in Feb 2022; it operates in India, Singapore, and Malaysia and plans to expand to other makers aggressively.

• Cisco Systems had quite a strong quarter and was able to exceed Wall Street expectation on all counts despite operating in an incredibly dynamic environment.
• The company continues to view strong customer adoption of its subscriptions and software driven by its targeted investments.
• We provide the stock of Cisco Systems with a ‘Hold’ rating with a revision in the target price.

• Despite the increasingly difficult consumer environment, Macy’s delivered a decent quarterly result which also happened to be an all-around beat.
• Its $5.6 billion in quarterly net sales exceeded its projections, despite a 1.6% decline in comparable owned plus licenced sales.
• Elevated inventory levels within particular categories were caused by the high industry-wide inventory levels and the decline in consumer discretionary spending.

• Electronic Arts’ solid results were driven by its extensive IP portfolio and expanding network of players that are actively involved in its live services.
• These distinctive structural advantages helped the company deliver an all-around beat despite the fact that it navigates the macro environment’s volatility.
• Their business’s durability and longevity are still fueled by their collection of sports and owned IP properties.

• Home Depot had a surprisingly good quarter unlike its rival, Lowe’s and delivered and all-around beat.
• All of the merchandizing departments of Home Depot posted positive comps; hardware, paint, millwork, plumbing, and building materials were all above average.
• Home Depot launched new capabilities on its B2B website to enhance the interconnected quoting and shopping business for its Pros.

• Microchip’s results for the quarter were solid and the company’s revenue increased by 6.5% sequentially and 25.1% annually to $1.96 billion surpassing Wall Street expectations.
• The management has signed into multiyear long-term supply agreements with several significant clients, effectively granting them reserved capacity in exchange for assured purchases, often lasting five years.
• We also have a dedicated analysis of the company’s Environmental, Social, and Governance (ESG) risk scores in order to evaluate the sustainability risk.

• Lowe’s had a disappointing quarter and saw a decline in its total revenues.
• Pro sales remained strong for the quarter.
• The trends of underlying home improvements during the quarter remained strong in the quarter, but the sales of DIY have been lower.

• Emperador (EMI SP) will replace Comfortdelgro Corp (CD SP) in the FTSE Straits Times Index (STI) (STI INDEX) at the close of trading on 16 September.
• Though the changes were expected, there is over 4 days of ADV to trade on both stocks and we do not feel there are a lot of pre-positions built up.
• There are some risks in the stocks, and we would look to close out positions prior to the implementation of the changes.

• Singapore-based Carro more than doubled its revenue in its latest financial year, raking in more than S$650 million (US$464.2 million) in revenue.

• The used-car platform, which also achieved profitability in FY 2021, said it is tracking at over US$930 million in run-rate revenue. It expects to see another 2x growth in revenue for FY 2023.
• Aaron Tan, co-founder and CEO of Carro, attributed the firm’s profitability to its focus on online retailing and machine learning.

• Glints, a Singapore-based careers platform, has raised US$50 million in a series D funding round co-led by DCM Ventures, Lavender Hill Capital, and Persol Holdings.
• The deal pushed the firm’s total funding to date to more than US$80 million, making it the most funded startup in Southeast Asia’s talent recruitment space.
• Glints connects companies to talent pools in Indonesia, Malaysia, Singapore, Vietnam, the Philippines, and Taiwan

• Rex reported a disappointing set of results mainly due to continued struggles in Oman. While Oman production was well over 10K bpd in 1H21 it deteriorated every month in 1H22.
• Revenue was 99.45M USD (+31%) but we estimate it would have been closer to 149M USD if the Yumna field wouldn’t have stopped producing for almost 70 days in 1H22.
• YTD stock is -23% and can only reverse if management proves Oman is ready to rebound. Dividend payments will start on a quarterly basis as of October 2022.

• Frasers Hospitality Trust (FHT SP)’s EGM and trust scheme meeting will take place on 12 September. The effective date is 12 October with a payment date of 19 October.
• The offer comprises S$0.70 cash per share + permitted distributions (estimated 1.356 cents). The IFA considers the scheme consideration to be fair and reasonable.  
• This is a done deal. For a 19 October payment, the gross and annualised spread of the offer (inc. permitted DPU) S$0.714 per unit is 1.9% and 12.1%, respectively. 

• There are 46 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
• Two new deals were discussed this week: Thoma Bravo’s tilt for Nearmap Ltd (NEA AU); Net Marketing (6175 JP)‘s MBO. 
• Key updates took place for Frasers Hospitality Trust (FHT SP), Tassal (TGR AU), Genex Power Ltd (GNX AU), MACA Ltd (MLD AU), and Giordano International (709 HK).

For our next Webinar, we have the pleasure of welcoming back Analyst Nicolas Van Broekhoven, who will go through his latest picks in the Singapore market, highlighting key stocks and names to watch out for in the Lion City.

The webinar will be hosted on Wednesday, 24 August 2022, 17:00 SGT/HKT.

Nicolas Van Broekhoven was on the buy-side for 15 years, and worked most recently at a medium-sized boutique asset management firm. He grew up in Europe, went to university in the US and has been living in Singapore for the last seven years, which has given him a broad scope on the world and investing in general. He considers himself a generalist investor with a preference for small and mid-cap companies and special situations. However, a large-cap that has gone temporarily out of favour might also pique his interest.

• A little long in the tooth but the Scheme Doc for Frasers Hospitality Trust (FHT SP) was released this morning. 
• It is the standard multi-hundred page document (in this case 502 pages). And it does little other than tell the same weak story as the announcement did.
• But the price is unchanged and the Scheme Meeting is 10 September 2022. This looks like it will be a done deal. 

• In June-July I warned of a reinvestment trade into S-REITs due to the S$2.0-3.0bn cash-out by investors in Mapletree North Asia Commercial Trust and sellers into the SPHREIT Chain Offer.
• Many investors who would need to re-allocate. The trade was to buy major S-REITs. From my last insight, a basket is up 5.3%. MCT has already topped out vs peers.
• The question is…. is there still a trade left to run?

• Sea’s share price dropped 14% yesterday following its 2Q22 results as $2.9bn revenue ($3.0bn for consensus) and $659.4m operating loss excluding goodwill impairment ($594m for consensus) were weaker than expected.
• After lowering the e-commerce revenue guidance by $400m in 1Q22, Sea Ltd (SE US)’s decision to suspend 2022 e-commerce revenue guidance in 2Q22 is an early indication of difficulties ahead.
• Digital Entertainment’s gross bookings are down another 10% QoQ in 2Q22, which indicates that Free Fire’s revenue and profitability could continue to go down during the second half of 2022.