Daily Brief Consumer: Fancl Corp, Selamat Sempurna, TSE Tokyo Price Index TOPIX, Perfect Medical Health, Delfi Ltd, Aisin , Pilgrim’S Pride, Post Holdings, Burberry, Life Time Group Holdings and more

• For the month of June 2024, 8 new transactions (firm and non-binding) were discussed on Smartkarma with an overall announced deal size of ~US$6bn.
• The average premium for the new transactions announced (or first discussed) in June was ~52%. The average premium YTD is ~47%. 
• This compares to the average premium for transactions in 2023 (117 transactions), 2022 (106), 2021 (165), 2020 (158), and 2019 (145 ) of 39%, 41%, 33%, 31%, and 31% respectively.

• Selamat Sempurna is one of the most interesting industrial companies in Indonesia, with a leading market share in filters for auto and heavy equipment markets in Indonesia and overseas.
• 1Q2024 was impacted by a seasonal slowdow ahead of Lebaran and a decline in sales to Russia, offset by strong US sales. Management remains confident in the outlook for FY2024.
• Selamat Sempurna will continue to benefit from growth in the filter replacement market for both auto and heavy equipment markets and already has exposure to EVs. Valuations are attractive. 

• While it’s commendable that more companies are publishing their skills matrices, it’s not enough to verify that the skill items are useful in expanding the value of the company.
• Since management strategies vary from company to company, the skills required to formulate and execute a company’s strategy are not likely to be the same as those of other companies.
• Director candidates should be selected based on the skills needed to expand the value of the company in future and skills that complement the skills lacking in the current directors.

• Perfect Medical Health (1830 HK) reported flat revenue/profit growth for FY24 due to a weak Q4 that plagued the entire HK consumer space. H2FY24  revenue/profit growth was -6.3%/-12.5%
• The company paid a generous dividend of 31.5 cents for FY24 (vs. 30.0 cents), resulting in a 12.5% dividend yield.
• We will follow up with more details after the earnings call and presentation. 

Key points

• Delfi, the leading chocolate company in Indonesia, is experiencing challenges due to rising cocoa prices
• Despite a decrease in share price, analysts remain optimistic about Delfi’s future prospects
• The company’s management team is implementing strategic measures to protect profit margins and improve financial performance, with initiatives planned for 2024 expected to mitigate the impact of cocoa price increases

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• Aequitas Research’s weekly update on the IPOs, placements, lockup expiry and other ECM linked events that were covered by the team over the past week.
• On the IPO front, we looked at the upcoming mega-listing for Hyundai Motor India.
• On the placement front, the week was dominated by the cross-shareholding unwinds in Aisin (7259 JP) and Mitsui & Co Ltd (8031 JP). 

• Pilgrim’s Pride Corporation reported positive financial results for the first quarter of 2024, demonstrating significant growth and operational efficiency despite challenging market conditions.
• The company recorded net revenues of $4.4 billion, marking a 4.7% increase from the previous year.
• Moreover, the adjusted EBITDA reached $372 million, which is a 145% rise compared to Q1 2023, and the adjusted EBITDA margin expanded from 3.6% to 8.5%.

• Post Holdings delivered robust performance in the second quarter of 2024, anchored by strong execution across core segments such as Consumer Brands and Foodservices, despite notable challenges including volume declines in several categories.
• The company’s proactive management, highlighted by strategic price adjustments and rigorous cost control, have enabled Post to navigate a complex economic landscape defined by shifting consumer behaviors.
• Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology.

• Luxury sector experiencing challenges after period of record-high growth
• Key players like LVMH, Hermes, and Richemont facing corrections in share prices
• Burberry facing short thesis due to concerns about navigating changing market dynamics

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• Life Time Group Holdings, Inc. showcased a strong financial performance in the first quarter of 2024, although there were some mixed aspects within the results.
• The company reported a notable increase in total revenue, which rose by 16.8% to $596.7 million from the year earlier.
• This rise was predominantly fueled by a 19% growth in membership dues and enrollment fees and a 10.5% uptick in in-center revenue.