Consumer: JD.com Inc., Uniti Group Ltd, Yamaha Motor, aCommerce Group, Crown Resorts, Mynews Holdings Bhd, Ferretti SpA and more

• We do not expect there will be huge selling in JD.com Inc. (9618 HK) immediately. However, there will be an overhang on the stock in the near to medium term.
• JD.com could drop in the next few days as the ADR allotment is sold in the market. Shorts that have been built up could soak up some of the flow.
• The big worry is the US$4bn of JD.com stock that Prosus will receive. It is likely they will look to sell and use the cash to buy back their own stock.

• Buying 13.5% below Morrison & Co’s Offer terms last week for Aussie broadband player Uniti Group Ltd (UWL AU) was the right call as a new (indicative, non-binding) proposal emerges.
• Macquarie Asset Management’s Real Assets division and Public Sector Pension Investment Board are offering to acquire Uniti for $5.00/share, via a Scheme of Arrangement, an 11% premium to Morrison’s tilt. 
• The Board of Uniti is currently considering the new proposal.  Morrison’s four-week exclusivity period kicked off last Friday. 

• The Connect consortium will offer A$5.00 cash per share, an 11.1% premium to the Morrison & Co indicative offer of A$4.50.
• Brookfield has joined Morrison & Co as joint bidders. This development suggests another round of bids for Uniti Group Ltd (UWL AU).
• The A$5m fee to break the Morrison/Brookfield exclusivity pales in comparison to Connect consortium’s A$340m premium to the Morrison/Brookfield offer. Expect Connect consortium to secure due diligence access. 

• Yamaha Motor (7272 JP) announced a short-term buyback. 3 months, 3%. It isn’t huge but it helps with the TOPIX FFW changes to come in two weeks. 
• It also helps with the extra overhang from last year’s selldown and the significant cross-holding overhang which exists. 
• But the shares are very inexpensive vs peers when one looks at consensus forward earnings and EBIT, and better growth is expected too.

• ACommerce Group (ACOM TB) is looking to raise about US$200m in its upcoming Thailand IPO.
• Acommerce is an ecommerce enabler providing end-to-end and ala carte ecommerce solutions for brands in Southeast Asia (SEA). 
• Acommerce has been a key beneficiary of COVID, however, has been recording unexpectedly weak margins, suggesting that it does a lot of logistical heavy lifting. 

• JD.com Inc. (9618 HK) has been able to sustain its relative market share gains, in Chinese online retail sales, over the past two years, despite increased competitive pressure.
• Recent weakness in its margin progression trajectory has cast doubts on its ability to realise its potential for long-term margin expansion.
• With net cash at 31% of its market cap, relative valuation levels seem attractive.

• The Perth Casino Royal Commission has found Crown Resorts (CWN AU)‘s casino in Perth, Western Australia, is “not suitable” to hold a gaming licence.
• This follows the findings in New South Wales and Victoria that two of Crown Resort’s other subsidiaries were either not suitable to be granted a casino license or not suitable.
• As with the recently announced AUSTRAC proceedings, Blackstone would have been well prepared for this latest development.

• Maintain HOLD with lower TP of MYR0.80
• A disappointing quarter
• Improved topline growth dragged by higher opex
• Cut FY22-FY24 earnings estimates

MNHB’s 1QFY22 results were below our and consensus expectations due to higher-than-expected operational expenses related to its CU store expansion. Going forward, topline growth should see strong momentum in tandem with relaxed movement restrictions but start-up losses from its new CU stores may hinder group earnings recovery. Hence, we lower our FY22-FY24E earnings estimates by 17%-80%. Rolling forward our valuation base year to FY23, our TP is lowered to MYR0.80 (pegged on an updated normalised mean PER of 29x vs. 32x previously).

• Luxury Italian yacht maker Ferretti Group plans to raise US$248.4m at a market capitalisation of US$1.1bn and a post-money EV of US$807m at the midpoint of the IPO price range.
• Ferretti’s revenues suffered with COVID-19 and ongoing issues such as the Ukraine-Russia war and China-US trade tensions would only put further pressure on the company.
• We think Ferretti’s shares are fairly valued at the indicative IPO price range given the current volatility in the market, political turmoil and lack of investor confidence.