In today’s briefing:
- Anta Sports Placement – A Large Deal to Digest with Unknown Use of Proceeds but Track Record Is Good
- Nikkei 225 Sep 2023 Rebalance Gets Interestinger – Possible Fast Retailing Cap and Zozo Stretch
- StubWorld: Genting Berhad Is Cheap
- ZJLD Group IPO – Sentiment Could See a Positive Shift, Mid-Bottom End Digestible
- ZJLD Group IPO: Valuation Insights
- Oishi Group (OISHI TB): IFA Recommends the THB59.00 Delisting Offer
- Maintaining Labor Productivity by Cutting Working Hours Was Effective but Risks Should Be Considered
- Nike Inc.: Continued Franchise Expansion
- Seven & I: The Biggest Barrier to Change Has Gone
- Walgreens Boots Alliance Inc.: Advancements In Healthcare & Key Drivers
Anta Sports Placement – A Large Deal to Digest with Unknown Use of Proceeds but Track Record Is Good
- Anta Sports Products (2020 HK) aims to raise around US$1.5bn in its top-up placement.
- Anta hasn’t specified what it aims to do with the money that it’s looking to raise, furthermore, it’s already net cash.
- In this note, we will talk about the placement and run the deal through our ECM framework.
Nikkei 225 Sep 2023 Rebalance Gets Interestinger – Possible Fast Retailing Cap and Zozo Stretch
- With 3.5 months left in the dataset, the data is pretty close to settled. The interesting bits are elsewhere. There are three auto DELETEs and two auto ADDs. Maybe.
- One auto-ADD is Toshiba, which may have a deal on it. That leaves two to add for sector balance. That could be Nitori (9843 JP) and Zozo (3092 JP).
- Friday’s move on Fast Retailing brings in the issue of the new capping function. That would be a different US$2bn selldown. Lots of gory details here.
StubWorld: Genting Berhad Is Cheap
- Genting Bhd (GENT MK)‘s implied stub and the simple ratio (GENT / Genting Singapore (GENS SP)) are at multi-year lows.
- Preceding my comments on Genting are the weekly setup/unwind tables for Asia-Pacific Holdcos.
- These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation >20%.
ZJLD Group IPO – Sentiment Could See a Positive Shift, Mid-Bottom End Digestible
- ZJLD Group (ZJLD HK) is looking to raise around US$811m in its Hong Kong IPO.
- ZJLD Group (ZJLD) is a Chinese liquor company primarily producing baijiu.
- In this note, we will look at deal dynamics and share our thoughts on valuation.
ZJLD Group IPO: Valuation Insights
- ZJLD Group (ZJLD HK) has launched its HKEx listing at HK$10.78-12.98 per share to raise up to US$811 million. Books are open from 17 to 20 April.
- We previously discussed the IPO in ZJLD Group IPO: The Bull Case, ZJLD Group IPO: The Bear Case and ZJLD Group IPO: Valuation First Look.
- Our valuation analysis suggests that the IPO price range is attractive. Therefore, we would participate in the IPO.
Oishi Group (OISHI TB): IFA Recommends the THB59.00 Delisting Offer
- The Oishi Group PCL (OISHI TB) IFA opines that shareholders approve Thai Beverage (THBEV SP)’s delisting tender offer of THB59.00 per share at the EGM on 3 May.
- The offer is conditional on Oishi shareholder approval which requires 75% approval by total outstanding shares and <10% rejection by total outstanding shares.
- The offer is attractive to the IFA’s fair value of THB53.48-56.42 per share. At last close and the end-July completion, the gross and annualised spread is 2.2% and 8.1%, respectively.
Maintaining Labor Productivity by Cutting Working Hours Was Effective but Risks Should Be Considered
- Many companies have worked to ensure labour productivity by curbing personnel costs by reducing work hours and shifting from full-time to part-time workers, as well as by controlling depreciation.
- Maintaining labor productivity by converting to part-time and reducing working hours of full-time employees has been an effective measure to ensure operating profits margins, but it also carries risks.
- Personnel cost/sales have bottomed out in 2018 and are on the rise. With cost structures changing dramatically after the economic reopening, controlling labor costs will be more difficult than ever.
Nike Inc.: Continued Franchise Expansion
- Nike delivered another strong quarter with revenue growth across all geographies, channels, and brands.
- It had strong digital growth, fueled by increased traffic on its apps and mobile.
- In APLA, the brand momentum of Nike continues to fuel strong growth.
Seven & I: The Biggest Barrier to Change Has Gone
- Seven & I has announced major restructuring of its struggling Ito-Yokado GMS chain – a company that big investors have long demanded be sold off entirely.
- The latest round of cuts had to wait until the company’s founder finally passed away, although are likely not going to be the last.
- Seven & I has long had a coherent plan to rationalise – but was just waiting for the founder to pass – with a series of disposals now likely.
Walgreens Boots Alliance Inc.: Advancements In Healthcare & Key Drivers
- Walgreens Boots Alliance produced a strong second quarter which happened to be an all-around beat.
- Also, this quarter served as a turning point in their transition to the healthcare industry.
- Besides that, Boots had a fantastic quarter in the international segment, achieving retail comp growth of 16% over the same period last year.
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