In today’s briefing:
- NTT’s Partial Offer for Intage (4326) Part Deux – Refining Pro-Ration Expectations
- The New Aisin (7259) MTP – Selling Crossholdings, Eventually
- Tuhu Car IPO – Peers Have Corrected, Little to No Upside Left on the Table
- IMAX China (1970 HK): Risk as Scheme Vote on 10 October
- TUHU Car IPO: Valuation Insights
- IMAX China (1970 HK)’s Offer: 10th Oct Shareholder Vote
- Aisin (7259) | MTP Gains Traction
- Tuhu Car IPO: Keep the Drive
- Ryohin Keikaku: Big Moves Ahead with Strong FY24 Guidance
- Perfect Medical : Previewing the H1 FY24, Soft China To Lessen Growth
NTT’s Partial Offer for Intage (4326) Part Deux – Refining Pro-Ration Expectations
- Last week I wrote about NTT’s Partial Offer for Marketing Consultant Intage (4326) – (with a spurious hyphen at the end).
- In the last couple of days, there have apparently been a few blocks printed on the tape. I have received questions about pricing and pro-ration.
- So here I provide a set of 11 possible pro-ration cases, and suggest ways for traders and investors to think about the risks and possibilities.
The New Aisin (7259) MTP – Selling Crossholdings, Eventually
- Toyota Group autoparts maker Aisin Seiki (7259 JP) today announced a new Medium-Term Plan. They plan to shift their business away from “entrusted” business, towards BEV, Brakes, and “Safe/Comfort Entry”
- They aim to grow revenues 25% from 2021 to 2025 and an additional 10-20% by 2030.
- They also aim to improve investment and capital efficiency, and that’s where we can look at the interesting possibilities.
Tuhu Car IPO – Peers Have Corrected, Little to No Upside Left on the Table
- Tuhu Car (2007986D HK) is looking to raise around US$160m in its Hong Kong IPO. Tuhu is an integrated online and offline platform for automotive services in China.
- In earlier notes, we had looked at the firm’s past performance, discussed our earnings assumptions and our thoughts on Tuhu’s valuation.
- In this note, we discuss valuations at the final price range.
IMAX China (1970 HK): Risk as Scheme Vote on 10 October
- IMAX China Holding (1970 HK)‘s scheme document is out, with the court meeting scheduled for 10 October. The IFA considers IMAX Corp (IMAX US)‘s HK$10.00 offer fair and reasonable.
- The key condition is approval by at least 75% of disinterested shareholders (<10% of all disinterested shareholders rejection). No independent shareholder holds a blocking stake.
- A recovering box office, early indications of an effort to rally retail NO votes and a high minority participation rate in AGMs pose a risk. The risk/reward profile is unfavourable.
TUHU Car IPO: Valuation Insights
- Tuhu Car (2007986D HK), a leading integrated online and offline platform for automotive service in China, has launched its HKEx IPO at a price range of HK$28.00-31.00 per share.
- In TUHU Car IPO: The Investment Case, we highlighted the key elements of the investment case. In this note, we present our forecasts and discuss valuation.
- Our valuation analysis suggests that Tuhu is reasonably priced at the IPO price range. We would participate in the IPO.
IMAX China (1970 HK)’s Offer: 10th Oct Shareholder Vote
- Back on the 13 July, IMAX China Holding (1970 HK) announced a take-private transaction from its parent IMAX Corp (IMAX US) at HK$10/share. Terms have been declared final.
- The price is a 9.65% premium to last close but a 39.47% premium over the closing price on the last full trading day, suggesting apparent news leakage.
- The Scheme Doc is out and independent shareholders get to vote on the transaction on the 10th October. This vote could – should – be close. Only for the brave.
Aisin (7259) | MTP Gains Traction
- Aisin’s stock price rose by +8% today after the company held its MTP strategy briefing
- Aisin to restructure its business portfolio and focus on new growth areas for EV’s – eAxle, battery frames, and braking technologies
- Aisin aims to generate ¥400b from balance sheet reform – asset sales, inventory management and sale of cross-shareholding.
Tuhu Car IPO: Keep the Drive
- Chinese automotive maintenance services platform Tuhu Car (2007986D HK) is planning to raise around US$160m in its upcoming HKEx IPO.
- The company’s franchised business model seems to have worked well, while its focus on high margin products/services have helped improve profitability.
- In this insight, we take a look at Tuhu Car’s business model, business segments and financials and we will discuss the company’s valuation in a follow-up insight.
Ryohin Keikaku: Big Moves Ahead with Strong FY24 Guidance
- Ryohin Keikaku (7453 JP) experienced a 45% leap in its share price since its last earnings announcement, primarily fueled by a positive OP surprise of nearly ¥3.0bn.
- Our analysis indicates the potential for another big earnings beat in FQ4, primarily because the consensus remains conservative in its cost assumptions.
- Additionally, we anticipate that the company will provide FY24 OP guidance in the range of ¥45-50bn. This would constitute a significant upside surprise compared to the current FY24 consensus.
Perfect Medical : Previewing the H1 FY24, Soft China To Lessen Growth
- Perfect Medical Health (1830 HK) will report its H1 2024 results in late November 2023. We expect slow China growth to result in revenue/profit growth of 10%/15% YoY.
- The company will continue to open outlets in HK, and the plan is to open ten by the end of FY24 (3-4 at the end of H1FY24e).
- The stock trades at 12.7x PE FY24e, with an 8.7% dividend yield and around 16% of the market capitalization in net cash and investments (~800 mn HKD).
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