Daily Brief Consumer: Alibaba Group Holding , LG H&H, Beenos Inc, Wynn Macau Ltd, Taste Gourmet, Tokyo Stock Exchange Tokyo Price Index Topix, Colgate Palmolive Co, Church & Dwight Co, Lkq Corp, PTT Oil & Retail Business and more

• The revenue growth rate rose to 14% in 1Q24, compared to the past four stagnant quarters.
• All businesses continued to improve their margins, so that the general operating margin rose to 19% in 1Q24 versus 12% in 1Q23.
• We believe the re-organization is successful and the stock price is overly impacted. Buy.

• In this insight, we lay out the thesis that LG H&H is likely to be one of the biggest beneficiaries of the return of Chinese group tours to Korea. 
• LG H&H consistently generated more than 1 trillion won in operating profit from 2018 to 2021.
• We expect LG H&H to generate 1 trillion won or more in operating profit in 2024 and 2025, which would be 20-25%+ higher than current consensus estimates in this period. 

• Beenos revealed a ¥300m buyback plan in 2QFY23 and recently declared a ¥500m buyback in 3QFY23. This incremental buybacks is likely to continue due to disposal of incubator investments.
• The cash balance of 34% of total assets and over 49% of market cap, supports the ongoing buyback trend even if incubator divestments take longer than expected.
• Hence, we expect Beenos Inc (3328 JP)’s Holdco discount to move closer to the 20% mark, potentially resulting in a 75% upside in the short term.

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

• Country Garden Holdings Co
• Sino-Ocean Service
• Wynn Macau Ltd

• Taste Gourmet (8371 HK) reported its Q1 FY24 with revenues up 47% YoY and core profits up 349% YoY.  We believe that the company will report stronger revenues in Q2.
• The restaurant count increased from 39 to 42 by the end of Q1 FY24 for HK. As of the latest date, the company has 46 restaurants in HK. 
• The company also had 126.5 mn HKD of net cash at the end of Q1 FY24 (vs 118 mn HKD in FY23), almost 20% of the current market capitalization. 

• The number of companies that announced their intention to move to Standard Market has increased to 48, while most of 268 transitional companies are expected to move to Standard Market.
• Companies that cannot meet Prime Market listing criteria in 2026 can also move to Standard Market by undergoing examination, so they don’t need to announce their move in a hurry.
• Prime Market has slimmed down from TSE 1st Section by 600 companies, but it will remain market where many companies with market capitalization of about 50 billion yen are listed. 

• Colgate-Palmolive Company delivered a solid result and managed an all-around beat in the last quarter.
• The company produced a decent performance in terms of organic sales growth.
• In addition to increasing its gross margin, Colgate-Palmolive also increased its operating margin.

• Church & Dwight Co. delivered a strong result and managed an all-around beat last quarter.
• In Q2, the laundry business performed well dollar and unit share, Church & Dwight ended the quarter as the fastest-growing laundry detergent, liquid detergent, unit dosage detergent, and aroma booster manufacturer.
• ARM & HAMMER Liquid Laundry detergent increased its share by 90 basis points.

• LKQ delivered mixed results for the previous quarter, with revenues well below Wall Street’s expectations but managed an earnings beat.
• Despite the headwinds from various macroeconomic conditions, the company’s core segments demonstrated resilience, showcasing the strength of its business model and operational excellence initiatives.
• The North American and European segments collectively accounted for around 90% of the total component EBITDA, reflecting the success of LKQ’s diversification strategy.

• OR delivered a 2Q23 NP of Bt2.76bn (-58% YoY, -7% QoQ), in line with our projection of Bt2.77bn.
• The core profit marked at Bt2.56bn in 2Q23 (-59% YoY, -15.5% QoQ).
• Its core earnings were pressured on a YoY basis by the mobility business, whose gross margin per liter narrowed to Bt0.96/liter in 2Q23 (vs. the high base of Bt1.61/liter in 2Q22).