In today’s briefing:
- I-Tail Corporation IPO Trading – Should Be Able to Provide Some Holiday Cheer
- Food & Life: Can’t Avoid Headlines For Too Long & Starting to Fall Back Towards The Rest of The Pack
- I-Tail Corporation IPO: Trading Debut
- Buy Shenzhou on Margin Recovery
- Asia Gaming: Wynn Macau Poised to Move up as Balance Sheet Is Bolstered and Headwinds Begin to Ease
- VinFast Auto IPO: The Bull Case
- VinFast Auto Pre-IPO – The Negatives – … But Starting Low
I-Tail Corporation IPO Trading – Should Be Able to Provide Some Holiday Cheer
- I-Tail, an OEM in the wet pet food category, raised around US$600m in its Thailand IPO. It is a subsidiary of Thai Union Group (TU TB).
- As per ITC, it was the number two pet food company in Asia and in the top ten pet food companies globally. ITC expertise lies in fish-based wet pet food.
- In our previous notes, we have looked at the company’s past performance, undertaken a peer comparison and spoken about valuation. In this note, we will talk about the trading dynamics
Food & Life: Can’t Avoid Headlines For Too Long & Starting to Fall Back Towards The Rest of The Pack
- Food & Life (3563 JP), best known for its affordable conveyor belt Sushi restaurant chain Sushiro, is looking to break out after dropping more than 60% in the last year.
- This breakout coincides with Sushiro’s overseas growth as the segment revenue and OP grew 27% and 108% QoQ respectively in the previous quarter.
- Given its tendency hit the headlines, mostly for the wrong reasons, risks rewards aren’t that great. Multiples have downside potential with Sushiro’s profitability falling towards peers.
I-Tail Corporation IPO: Trading Debut
- I-Tail (ITC TB) priced its IPO at THB32 per share, the top-end of the price range, to raise gross proceeds of THB21,120m (US$608m). The shares will start trading tomorrow.
- We previously discussed the IPO I-Tail Corporation IPO: The Bull Case, I-Tail Corporation IPO: The Bear Case, I-Tail Corporation IPO: A Strong 3Q Results Update, I-Tail Corporation IPO: Valuation Insights.
- Peers have re-rated and the IPO price continues to imply a discount to the median peer CY2023 P/E multiple. Therefore, the IPO price remains attractive.
Buy Shenzhou on Margin Recovery
- Gross margin is under pressure throughout 2022 but will recover in 2023
- Brands have been focusing on destocking and the inventory levels trend down
- Capacity is expected to grow by 10% to low teens y/y in 2023
Asia Gaming: Wynn Macau Poised to Move up as Balance Sheet Is Bolstered and Headwinds Begin to Ease
- Parent Wynn Resorts Ltd’s. REIT deal for its Boston property, proceeds of US$1.7b rings its balance sheet cash to US$4.4b.
- 3Q22 results earnings miss entirely due to China zero covid policy that could begin to ease earlier than anticipated by the market.
- At a P/E (ttm) of 8.44 the stock is yet to reflect a more positive tone of its strengthened balance sheet, 6.1% stake in the parent bought by an activist.
VinFast Auto IPO: The Bull Case
- VinFast (1905332D VN), a Vietnamese EV (electric vehicle) manufacturer and a majority-owned affiliate of Vingroup Jsc (VIC VN), has filed for a US$1.0 billion IPO to list on Nasdaq.
- VinFast is in the middle of a transition from an ICE to a pure-play EV manufacturer. VF 8, its second EV SUV, will be delivered in the US in 4Q22.
- The key elements of the bull case rest on a credible EV roadmap, speed-to-market, solid consumer interest and models with attractive range-to-price ratios and total cost of ownership.
VinFast Auto Pre-IPO – The Negatives – … But Starting Low
- VinFast (1905332D VN) is looking to raise up to US$1bn in its upcoming US IPO.
- VinFast is a full-scale mobility platform focused primarily on designing and manufacturing premium EVs, electric scooters and electric buses.
- In this note, we talk about the not-so-positive aspects of the deal.
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