In today’s briefing:
- Fancl (4921) – Extendy-Extendy-Bumpity-Bumpity
- Stanley Electric (6923) – Salutary Q1 and BIG Buyback
- Charoen Rearranges ThaiBev and TCC’s Deckchairs
- Ola Electric IPO: Offering Details & Index Inclusion
- Potential Big Changes at the Korean Chaebols – The Age Factor of Chairman/Honorary Chairman
- China Resources Beverage (华润饮料) Pre-IPO: A Visit to Convenience Stores
- Will Margin Contraction, Decline in Deliveries, and Trump’s EV Policy Reversals Stall Tesla?
- BUY/SELL/HOLD: Hong Kong Stock Updates (July 29)
- Tesla’s Q2 Revenue Up 2% to $25.5B but Misses Earnings Expectations; Stock Drops 8%
- Ola Electric: India’s First EV IPO – Key Facts, Financials & Valuation
Fancl (4921) – Extendy-Extendy-Bumpity-Bumpity
- The Kirin Holdings (2503 JP) Tender Offer to buy out minorities in Fancl Corp (4921 JP) closes today. Or at least the current one does.
- The original deal announced was light, and the stock has traded above terms since the announcement, with one fund buying up to 7.94%.
- I expect Kirin to extend and bump next week, or bump/extend now, depending on their visibility on Fancl Q1.
Stanley Electric (6923) – Salutary Q1 and BIG Buyback
- Today after the close Stanley Electric (6923 JP) announced a salutary Q1 result which was “ahead of in-line” in most metrics towards unchanged H1 and FY guidance.
- The company also announced a BIG on-market buyback at 8.1% of shares out, to be bought back with a delayed start over the 7.5mos starting 13 August.
- At last price, the buyback is ~10mm shares. The details are interesting and are worth a look.
Charoen Rearranges ThaiBev and TCC’s Deckchairs
- Back on the 18th, the Sirivadhanabhakdi family-backed Thai Beverage (THBEV SP) announced it would swap its 28.78% stake in Frasers Property Ltd (FPL SP) with THBEV-affiliate TCC Assets.
- Under the agreement, TCC will transfer a 41.3% stake in food and beverage play Fraser And Neave (FNN SP) to THBEV, lifting THBEV’s holding to 69.61% from 28.31% currently.
- The share swap triggers no Offers for either F&N or FPL. THBEV says it has no plans to privatise F&N … at the moment.
Ola Electric IPO: Offering Details & Index Inclusion
- The Ola Electric (1700674D IN) IPO will see the company and existing shareholders sell 808.6m shares at a price range of INR72-76/share, valuing the company between US$3.79bn-US$4bn.
- Ola Electric (1700674D IN) will have a float of around 10% at the time of listing and that will increase to around 20% after the lock-up on anchor investors ends.
- Ola Electric (1700674D IN) could be added to global indices in February and March 2025, but inclusion in local indices with meaningful tracking assets will take longer.
Potential Big Changes at the Korean Chaebols – The Age Factor of Chairman/Honorary Chairman
- One of the important factors of big changes at the Korean chaebols is the age factor of the chairman/honorary chairman of each of these conglomerates.
- In this insight, we provide the shareholding ownerships and ages of the top 10 Korean conglomerates where age could become a major factor in impacting big changes that could occur.
- Among the 10 conglomerates listed below, Hyundai Motor Group, Celltrion Group, and SK Group have shown greater willingness to improve their shareholder return policies.
China Resources Beverage (华润饮料) Pre-IPO: A Visit to Convenience Stores
- We visited convenience stores to look for China Resources Beverage products.
- The company is in a price war with Nongfu Spring, for both drinkable water and beverages.
- Some CRB products, such as plum syrup, do not have any competitors in physical stores.
Will Margin Contraction, Decline in Deliveries, and Trump’s EV Policy Reversals Stall Tesla?
- Tesla’s stock dropped 12% post Q2 earnings, due to a 7% decrease in auto revenue, reflecting broader financial struggles despite a 15% rise in quarterly EV deliveries.
- Trump’s potential repeal of EV subsidies could reduce EV sales by 27% by 2030, but Tesla’s lower reliance on imports may mitigate the effect of increased tariffs.
- Elon Musk’s $5 billion investment in his AI startup xAI raises concerns about potential distractions from Tesla, even as he leverages political shifts to benefit Tesla.
BUY/SELL/HOLD: Hong Kong Stock Updates (July 29)
- Low volatility investing has taken the mantle from Dividend yield as the top strategy during July
- BYD Electronics (285 HK) and Alibaba Group Holding (9988 HK) are rated BUYs as their businesses show improvement.
- Kingdee International Software (268 HK) is seeing a softening in its SME business, however there is potential to gain market share from foreign ERP companies given the pledged government’s policies.
Tesla’s Q2 Revenue Up 2% to $25.5B but Misses Earnings Expectations; Stock Drops 8%
- Earnings Miss: Tesla’s Q2 revenue increased by 2% to $25.5 billion, but earnings per share were 52 cents, missing the forecast of 62 cents.
- Record Revenue in Energy: Tesla achieved record revenues and profits in its energy sector, with 130% QoQ growth in energy storage deployments and regulatory credit revenues.
- Stock Reaction & Competition: Tesla’s stock dropped over 8% after-hours, influenced by increased competition, production challenges, and a notable decline in auto revenue by 7% to $19.9 billion.
Ola Electric: India’s First EV IPO – Key Facts, Financials & Valuation
- Ola Electric (1700674D IN) , India’s leading electric 2-wheeler backed by Softbank Group ‘s Vision Fund, will launch its USD 735 million IPO on Friday, August 2.
- The IPO pricing suggests a post-money equity valuation of around USD 4 billion, significantly lower than its earlier funding levels.
- Government incentives for EVs are being revised, with the current scheme valid only until the end of September, creating uncertainty that has possibly impacted valuations.
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