Daily Brief China: PCCW Ltd, Taste Gourmet, Toyota Motor, MGM China Holdings and more

• Net of HKT Ltd (6823 HK), PCCW Ltd (8 HK) recorded negative EBITDA of HK$378mn in the 1H23.
• This is the largest six-month negative EBITDA figure since the EBITDA loss of HK$427mn in 2H22, and the third largest in the past decade. 
• PCCWs current discount to NAV is at an unsustainable 5%.

• With that out of the way, let’s dive into Taste Gourmet, a catering group listed in the secondary market (or GEM board) of the Hong Kong Stock Exchange.
• Catering is usually a business with little moat, characterised by low barriers to entry. 
• While some brands are widely recognizable, humans generally want to devour something different each day, therefore it is an everyday struggle for restaurants to stand out among competition.

• Toyota Motor Corp., the world’s biggest car seller, has announced plans to consolidate its research and development (R&D) resources in China and ramp up its focus on electric vehicles (EVs), as it attempts to revive stalling sales in the highly competitive market.
• The Japanese automaker said on Monday it would change the name of its largest R&D facility in China from Toyota Motor Engineering & Manufacturing (China) Co. Ltd. to Intelligent ElectroMobility R&D Center by TOYOTA (China) Co. Ltd., and consolidate engineers from its three China ventures into the newly named facility based in Changshu, Jiangsu province.
• Among other plans, it would also strengthen local development of electrified vehicles (EVs) including battery, hybrid and plug-in hybrid models and accelerate the development of an electric powertrain with its two biggest suppliers, Denso Corp. and Aisin Corp., the company said.

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. Country Garden Holdings Co
2. Vedanta Resources
3. China Jinmao Holdings
4. Geely Auto
5. First Pacific Co

and more…