In today’s briefing:
- StubWorld: Bloisi’s Appointment Stalls The Prosus Accretion Trade
- GAI-Related Numbers and Quotes from C1Q24 Earnings
- Trip.com (9961 HK): 1Q24, Quite Good Quarter, But Stock Up by 37% in Three Months
- HKTV (1137 HK): $2.15/Share Buy-Back
- Shenzhen Mindray Bio-Medical Electronics (300760.CH) – Time to Bring “New Growth Story” To Investors
StubWorld: Bloisi’s Appointment Stalls The Prosus Accretion Trade
- Prosus (PRX NA)‘s discount to NAV and implied stub widened after Fabricio Bloisi’s CEO appointment late last week. But the sell-down of Tencent (700 HK) to buy-back Prosus will continue.
- Preceding my comments on Naspers (NPN SJ)/Prosus/Tencent 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%.
GAI-Related Numbers and Quotes from C1Q24 Earnings
- Generative AI (GAI) helps capex, no doubt. But key question is whether capex can yield to revenue and profits;
- Content creation industry is sure to realize revenue and profits. iQiyi and NetEase already said so with concreate examples;
- Advertising can realize revenue by better matching of ads inventory and perhaps improve inventory utilization.
Trip.com (9961 HK): 1Q24, Quite Good Quarter, But Stock Up by 37% in Three Months
- In 1Q24, Trip’s revenue grew strongly by 29% YoY with all business booming.
- China and Trip achieved a lot overseas travelers in March and the Labor Day Holidays.
- However, the stock price has risen 37% in the past three months.
HKTV (1137 HK): $2.15/Share Buy-Back
- Online shopping platform play Hong Kong Television Network (1137 HK) (better known as HKTV) has announced a buy-back of 11.25% of shares out, at $2.15/share, a 20.8% premium to undisturbed.
- If successful, the Offer elevates co-founder Ricky Wong’s stake, together with concert parties, to 51.55% (before exercising options), up from 45.75% currently.
- HKTV has been in the news lately for all the wrong reasons: claims of non-payments to suppliers; and delaying its 2026 target after a 79% decline in FY23’s net profit.
Shenzhen Mindray Bio-Medical Electronics (300760.CH) – Time to Bring “New Growth Story” To Investors
- Mindray’s 2023 growth just hit the low end of our forecast.The good story that “recovery of routine diagnosis/treatment after COVID-19 would drive the growth of MI/IVD businesses” doesn’t hold water.
- Mindray may fail to get back to 20%+ revenue growth in 2024 based on current situation.The Company has to continue to “buy revenue” so as to reverse the declining trend.
- The valuation of about 25-30 PE is reasonable for Mindray, not undervalued. If PE falls to the range of 20-25, we think it is a good place to go long.
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