Daily Brief Consumer: BYD Co Ltd, Vedant Fashions, BYD, Panasonic Corp, Beenos Inc, KG Mobility, NagaCorp Ltd, Guoquan Food (Shanghai), Organto Foods, Adeia and more

• China granted a six-month grace period for carmakers and dealers to sell off as many as 2 million new vehicles that will be out of compliance with new emission standards taking effect July 1.
• The move is intended to ease pressure on the auto market amid slowing sales and a brutal price war.
• The government said it will allow sales of vehicles produced under the old pollution standards to continue until Dec. 31, though automakers will have to apply more stringent requirements to newly built autos starting July 1.

• Vedant Fashions (MANYAVAR IN) , (VFL) had recently debuted on the bourse in 2022. 
• The company has grown to be one of the largest brands in the wedding/celebration apparel industry, boasting a network of 595 stores and 300+ franchises as of March 2022.
• When it comes to the forensics, there are slight grey areas observed with respect to the accounting complications. The insight also highlights key governance takeaways.

• Chinese electric-car giant BYD Co. got a green light from regulators to take over a bankrupt online insurance unit of the scandal-plagued conglomerate Tomorrow Holding Co. Ltd. with plans to turn it into an auto insurance provider.
• The China Banking and Insurance Regulatory Commission (CBIRC) said Tuesday that it approved BYD’s 100% acquisition of E An Property & Casualty Insurance Co. Ltd.
• Chinese authorities seized the company three years ago.

• Panasonic reported a 13% increase in sales and a 4% increase in net profit for fiscal 2023, driven by strong performance in its lifestyle, automotive, and connect segments.
• Panasonic expects to beat Street consensus operating profit forecasts, reflecting the recovery of auto demand and recognition of tax credits for its battery production
• Panasonic is a key beneficiary of continued expansion of EV market. Stock cheap at 8x EV/EBIT vs historical average of 11x

• Beenos Inc (3328 JP), despite missing earnings and offering smaller-than-expected buybacks, is potentially a deeply undervalued investment.
• Beenos holds 38% of its market-cap in cash 14% in GoTo shares 72% in VC investments and 9% in investment securities, which amounts to over 133% of its current market-cap.
• Distributing these excess assets to investors could potentially generate more than 100% upside.

• KG Mobility belongs to the Consumer Discretionary sector, and if we consider its market cap on April 28th, it comfortably qualifies for inclusion in KOSPI 200 in the upcoming review.
• Although the KOSPI 200 eligibility rules do not explicitly prohibit a stock based on such short trading periods, there is a chance that KRX might exercise its discretionary provision (6.1.2).
• There is another significant event approaching us. As per current market cap levels, there is a high chance of KG Mobility being included in the KRX Auto Index in September.

NagaCorp (3918 HK – US$3.5 billion) is a Hong Kong-listed casino operator based in Cambodia’s capital city of Phnom Penh.

Its two “NagaWorld” casinos with 480 gaming tables and 3,700 slot machines, and hotels with 2,700 rooms and related commercial properties.

What makes NagaWorld unique is that it has a monopoly on running casinos in a 200km radius of Phnom Penh, lasting until 2045.

• Guoquan Food (Shanghai) (1786512D CH) is looking to raise about US$500m in its upcoming Hong Kong IPO.
• Guoquan Food (Shanghai) is a home meal solutions provider in China.
• Offering a wide variety of home meal solutions products under its Guoquan Shihui (鍋圈食匯) brand, the firm had a total of 755 SKUs as of Dec 22. 

• Organto has effectively transitioned its business to an asset-light model, growing revenue from $1.5M in 2018 to $49M in 2023E
• OGO now has a diversified platform covering 170 customers using its global supply chain that can provide year-round supply to its customers
• Organto’s management team and board contain various executives that grew SunOpta to >US$1B in sales using a similar business model Organto Foods Inc. (OGO:TSXV) operates as a marketer and distributor of organic and non-GMO fruits and vegetables to end-consumers in Europe.

• ADEA reported first quarter results highlighting the Company’s ability to generate free cash flow from its licensing business as it signed more contract renewals in the period
• After signing ten license agreements in the fourth quarter of 2022, ADEA signed another eight agreements in the first quarter.
• ADEA maintained its full year outlook on all metrics. ADEA is projecting adjusted EBITDA of $262M at midpoint. ADEA is applying its free cash flow to reducing its debt balance