Daily Brief Consumer: Boustead Plantations, KT&G Corporation, Garrett Motion, Tata Motors Ltd and more

• On the 24 August, Kuala Lumpur Kepong (KLK MK) entered an agreement with Boustead Holdings (BHB), Boustead Plantations (BPLANT MK)‘s largest shareholder, to acquire a 33% plus 1 share stake.
• Upon the completion of the agreement, KLK – together with BHB and LTAT – would make a Mandatory Offer for BPlant. The Offer Price would be RM1.55/share, a lifetime high
• It all looked pretty straightforward. However the BHB/LTAT agreement has twice been delayed. This may still get done. But there remain a number of political kinks to be ironed out. 

• Boustead Plantations (BPLANT MK) shares are down 16%, resulting in proprietary day trading and intraday short selling being suspended. The transaction is mired in political debate. 
• The bull case is that Kuala Lumpur Kepong (KLK MK) continues on-market purchases and the opposition will compromise, paving the way for deal completion. Timing is the key risk. 
• The bear case is a deal break. The downside is limited as the government will need another buyer, the shares trade below the undisturbed price, and the undemanding valuation. 

• In this insight, we discuss the alpha generation through companies that announced share buybacks in Korea in August and September 2023.
• We provide a list of 18 stocks in the Korean stock market that have announced share buyback programs in August and September 2023.
• The top three market cap stocks that have announced share repurchases include Celltrion Inc (068270 KS), Celltrion Healthcare (091990 KS), and KT&G Corporation (033780 KS). 

• GTX is scheduled to report third quarter results on October 24, 2023, as the Company continues to make strides in expanding its product offering
• The third quarter results should serve as a catalyst since the Company was expected to repurchase shares and reduce its debt balance during the period
• The impact from the ongoing strike in North America is likely to have minimal impact to GTX if it were to continue for an extended period of time

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.

• Medco Energi
• Tata Motors ADR