Daily Brief Consumer: Brilliance China Automotive, Budweiser Brewing APAC , Com7 , Paradise Co Ltd, Miniso, Inter Parfums, YETI Holdings Inc, Express and more

• With the Hang Seng Index dipping below the 15,000 mark earlier this week, it’s time to dust off some old school perspective.
• This insight looks at Benjamin Graham’s Net Nets, (current assets less current liabilities), then subtract any debt not included in current liabilities. More simply, current assets less total liabilities.
• Graham would conclude these stocks are priced for liquidation.  Stocks discussed include Brilliance China (1114 HK), Ming Yuan (909 HK), Yidu Tech (2158 HK), and A-Living Smart City (3319 HK).

• Short notional in Hong Kong is HK$335bn and has been falling over the last 12 months due to a drop in the market.
• In terms of short notional to marketcap, the Materials, Consumer Staples, Health Care, Utilities, Real Estate sectors are most shorted while the least shorted are Information Technology, Communication Services, Energy.
• The largest shorts have been built on BYD (1211), XPeng (9868), ICBC (1398), Xiaomi (1810), Link REIT (823), JD.com (9618), Wharf Holdings (4) and New World Development (17). 

• The SET50 index tracks the performance of the top 50 largest and most liquid names listed in the Stock Exchange of Thailand (SET). 
• In this insight, we take a look at the potential ADDs/DELs for SET during the index rebal event in June 2024.
• There could be three ADDs and three DELs as things stand. There are a couple of names lurking close to the border too.

• On 24 January, Mohegan Gaming & Entertainment announced that it has received the final approval to open a foreigners-only casino at its Inspire resort complex in Incheon, South Korea.
• This will become the first new foreigners-only casino in Korea in 19 years. Currently, there are 17 foreigners-only casinos in Korea.
• The opening of the Inspire Resort in Incheon, Korea will likely have a negative impact on the foreigners only casino operators in Korea including Paradise Co Ltd (034230 KS).

• We attended Miniso’s Investor Day on January 18-19 and came away positively. Management outlined growth strategy of fostering strong connection with Chinese supply chain to achieve fast turnaround of…
• We expect MNSO to report C4Q23 revenue and non-GAAP NI at 2.9% and 4.0% higher than consensus mainly due to new store openings;
• We maintain the stock as BUY and raise TP by US$2 to US$33/ADS to reflect our endorsement of the growth strategy.

• IPAR closed out 2023 with the same momentum that has been generating sales growth the last several years.
• The consumer has been receptive to fragrance and there has been no sign of slowing demand for the category
• IPAR provided preliminary fourth quarter sales of $329 million versus our estimate of $316.5 million. Sales growth within IPAR’s top selling brands was through Coach and Guess

Key points (machine generated)

• YETI is recommended as a short investment for the next few years due to its declining growth and loss of ground to competitors like Stanley Tumbler.
• The sustainability of YETI’s brand advantage is questioned, comparing it to other companies that have failed in the past.
• The author suggests that YETI may face a similar fate if it does not reverse its current trends.

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• We are reiterating our Buy rating and $20 price target for Express, but lowering our 4QFY23 projections after visiting stores in Long Island and Connecticut.
• That said, we believe the near term impact will be to reduce gross margins; as such, while we are maintaining our 4Q23 top line projections, we are lowering our gross margin projections, which results in increased 4Q losses.
• We believe the negative impact will be localized into FY23 and are leaving our FY24 projections unchanged.