Daily Brief Consumer: Boustead Plantations, Meituan, Pop Mart International Group L, 888 holdings and more

• Palm oil play Kuala Lumpur Kepong (KLK MK) has entered an agreement with Boustead Holdings, Boustead Plantations (BPLANT MK)‘s largest shareholder, to acquire a 33% plus 1 share stake.
• Upon the completion of the agreement, KLK will make a Mandatory Offer for all shares not owned in BPlant. The Offer Price is RM1.55/share, a lifetime high. 
• The agreement conditions are rudimentary. The MGO has no minimum acceptance condition. This is done.

• Meituan (3690 HK) reported 2Q2023 results yesterday which beat consensus estimates and the company’s profitability has further strengthened during the quarter.
• However, there has been clear signs of a slowdown in the company’s core local commerce biz with increased promotions/incentive, decline in revenue per on-demand delivery transaction and fall in OPM.
• Meituan has flagged that macroeconomic headwinds and adverse weather conditions could slowdown core local commerce biz in the current quarter which should drag down earnings.

• Pop Mart International Group L (9992 HK) presents an interesting story of a Chinese domestic brand going overseas, and potentially being successful overseas (at least in the short-term). 
• A recent case of a Chinese brand achieving success overseas is Miniso (MNSO US), and shareholders of Miniso have been richly rewarded. 
• Pop Mart trades at a PE of 24x based on estimated 2024 earnings, with around 30% expected net profit growth in 2024E.   

The Europe HY Trade Book for August 2023 includes current trade recommendations drawn from our European HY coverage universe, along with relative-value scatter plots and tables by industry.