In today’s briefing:
- Cisarua Mountain Dairy (CMRY IJ) – Fuelled by General Trade and Miss Cimory
- (Mostly) Asia-Pac Weekly Risk Arb Wrap: Chip Eng Seng, Mori Trust, Pendal/Pendal, DTAC/True
- Asia Gaming: Despite Macau Woes, Melco Stock Is Too Cheap to Ignore Now
- Nitori Retreats from the US but Gets Muscular in Japan and Asia
Cisarua Mountain Dairy (CMRY IJ) – Fuelled by General Trade and Miss Cimory
- Cisarua Mountain Dairy (CMRY IJ) remains one of Indonesia’s most interesting high-quality consumer staples companies, with strong brands in both premium dairy products and premium packaged foods.
- The company grew total sales by 76% YoY for 9M2022, with dairy products growing 51% YoY and packaged foods by 125% YoY driven by increasing capacity to serve burgeoning demand.
- Margins have been impacted by rising raw material prices but powdered milk prices have been falling which should mean margins recover but all the same 9M2022 net profit rose 1.5x.
(Mostly) Asia-Pac Weekly Risk Arb Wrap: Chip Eng Seng, Mori Trust, Pendal/Pendal, DTAC/True
- There are 49 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
- Two new deals were discussed on Smartkarma: the Tangs’ Offer for Chip Eng Seng (CHIP SP); and the Mori Trust Sogo Reit (8961 JP)/Mori Trust Sogo Reit (8961 JP) merger.
- Key updates took place for: Pendal Group (PDL AU)/Perpetual Ltd (PPT AU), Total Access Communication (DTAC TB)/True Corp Pcl (TRUE TB), and Lifestyle International Holdings (1212 HK).
Asia Gaming: Despite Macau Woes, Melco Stock Is Too Cheap to Ignore Now
- We calculated the intrinsic value of the stocks is ~30% undervalued at US$6.79 a share.
- The strong Manila market recovery and planned on time opening of Cyprus property does not seem to be baked into the price at writing.
- Macau travel bans will keep MLCO dead pooled, but value lies in its assets still at work
Nitori Retreats from the US but Gets Muscular in Japan and Asia
- Nitori is one of few Japanese retailers to brave the US market. The US has beaten Nitori for now and it will instead focus on Japan and Asia.
- Nitori’s ability to leverage its efficient supply chains to lower prices will likely lead it to further dominance at home and allow it to invest in the rest of Asia.
- The company expects pressures on costs to ease in 2023 as the Yen rises but is working on reducing the cost of goods and operations.
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