In today’s briefing:
- WISE Media Contents (TIGER ETF) Rebalancing Preview
- Pinduoduo (PDD): 4Q21, Undervalued Growth Rate and Record Profit Since IPO, Buy
- Farm Fresh IPO Trading – Solid Subscription, Should Come in at a Premium to Domestic Peers
- Ferretti IPO: At Best Fairly Valued
- Premier Anti-Aging Company: Getting to an Interesting Level
- ASICS (7936): Time for a Bounce
- Pick of the week – HUL
WISE Media Contents (TIGER ETF) Rebalancing Preview
- WISE Media Contents rebalances every quarter in January, April, July, and October. The effective date for the upcoming rebalancing is April 15.
- The gap between the rebalancing weight change estimations based on the float-adjusted market caps and the actual implementation of the ETF operator (TIGER) is not significant.
- Following stocks are worth paying attention: (Short) Jyp Entertainment, S.M.Entertainment, Studio Dragon, Jcontentree, and SBS Contents Hub / (Long) CJ ENM, DearU, D&C Media, Genie Music, and IHQ
Pinduoduo (PDD): 4Q21, Undervalued Growth Rate and Record Profit Since IPO, Buy
- PDD’s total revenue growth was low 4Q21, as the company gave up on direct sales.
- However, we believe the revenue growth will bounce back in 2023.
- PDD cut sales and marketing expense, so we believe operating margin will improve in following two years.
Farm Fresh IPO Trading – Solid Subscription, Should Come in at a Premium to Domestic Peers
- Farm Fresh Berhad (FF MY) raised around US$239m in its Malaysia IPO.
- In our view, the firm’s stronger margins and better growth potential warrants a premium to its other domestic peers.
- In this note, we will talk about the updates since then and the trading dynamics.
Ferretti IPO: At Best Fairly Valued
- Ferretti, a leading yacht builder based in Italy, started book building to raise up to USD 302m via a Hong Kong listing.
- In our previous note, we looked at the company’s key product segments, operating metrics, financials, and industry. We also compared the company with a close peer.
- In this note, we provide an update for the book building. We will run the deal through our ECM framework and provide an update on the deal.
Premier Anti-Aging Company: Getting to an Interesting Level
- We last wrote on this relatively small Japanese cosmetics company in September 2021 suggesting that it could be worth keeping an eye on given its cheaper valuation compared to peers.
- Premier Anti-Aging (4934 JP) shares are down 80% from the peak, mostly because it was sold-off alongside the low quality names in Mothers.
- It seems early to turn outright bullish on Premier Anti-Aging yet. However, if you are short other unprofitable names in Mothers, we think Premier Anti-Aging is a sensible long hedge.
ASICS (7936): Time for a Bounce
- Demand for ASICS running shoes remains strong. That should become clear as factories reach full capacity and shipping problems recede.
- Profit margins will expand due to less discounting and an improved channel mix.
- We turn bullish following a 30% decline from 52-week high. The stock is now trading at undemanding multiples versus peers.
Pick of the week – HUL
- HUL, the largest FMCG player in India, was formed by merging three subsidiaries of Unilever in 1956.
- HUL’s portfolio of products covers a wide spectrum including soaps, detergents, skin creams, shampoos, toothpastes, tea, coffee, packaged foods and branded atta
- Powerful brands and an envious distribution network are its primary strengths
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