In today’s briefing:
- JCNC Is Overstretched Vs. Astra
- Tunas Ridean: Sell Or Tender, But Don’t Do Nothing
- BYD Sales Hit Record High as China Steers Stimulus to Auto Market
- Seven & I (3382) | U.S. Gas Margins Offset Rising Energy Costs at Home
- Betagro IPO: Valuation Insights
- Betagro Pre-IPO -Refiling Updates- Continued Their Upward Trajectory but Paid Itself Large Dividends
- Alibaba, ICBC, Tencent, and Ping An
- Sands China Ltd: The Best Value Entry Point in the Sector as EVisa Easing Begins
- ShopBack Raises $80m from Temasek-Backed 65 Equity Partners
- Buying Japanese Drug Store Names: Welcia (3141-JP) And Sundrug (9989-JP)
JCNC Is Overstretched Vs. Astra
- Jardine Cycle & Carriage (JCNC SP) is currently trading at a ~9% discount to NAV, around the narrowest since the post-Covid nadir in April 2020.
- JCNC’s recent results highlighted a marked improvement in its unlisted Vietnamese automotive ops.
- Weakness in the Indonesian rupiah has taken some of the shine off Astra International (ASII IJ)‘s strong sales growth.
Tunas Ridean: Sell Or Tender, But Don’t Do Nothing
- Indonesian auto dealership play Tunas Ridean (TURI IJ)‘s buyback – and subsequent delisting – has been extended to the 12 October.
- TURI shareholders who do not tender – or sell in the market – will be left holding listed scrip.
- Currently trading a gross spread of ~3% to terms, net of the sales tax levy.
BYD Sales Hit Record High as China Steers Stimulus to Auto Market
- China’s largest new-energy vehicle (NEV) manufacturer BYD Co. Ltd. reported record sales last month as China stepped up stimulus to shore up sluggish economic growth.
- In September, Hong Kong- and Shenzhen-listed BYD sold 201,259 NEVs, a category that includes electric and hybrid vehicles.
- The figure was up 183% year-on-year and marked the seventh consecutive month of growth.
Seven & I (3382) | U.S. Gas Margins Offset Rising Energy Costs at Home
- 1H results, OP up +26% YoY, were good but in line with the recent Nikkei preview.
- The U.S. convenience store operation was the standout performer and the reason for the full year guidance raise
- We remain bullish on the stock. It is just too cheap relative to global peers
Betagro IPO: Valuation Insights
- Betagro (BTG TB), Thailand’s leading integrated food company, will open its books for its THB17.4 billion (US$462 million) from 10 to 25 October.
- We previously discussed the IPO in Betagro IPO: The Bull Case and Betagro IPO: The Bear Case.
- Our valuation analysis suggests that Betagro is fully priced at the IPO price. Give the IPO a pass, awaiting a lower entry point.
Betagro Pre-IPO -Refiling Updates- Continued Their Upward Trajectory but Paid Itself Large Dividends
- Betagro (BTG TB) is looking to raise about US$460m in its Thailand IPO.
- Betagro is an integrated agro-industrial and food business in Thailand. Sales continued to stage an upward trajectory, and higher ASPs, combined with a changing sales mix led to expanding profitability.
- However, the growth in sales hadn’t been uniform across all segments and the bounce in 1H22’s profitability seems to come off a low base as well.
Alibaba, ICBC, Tencent, and Ping An
- The YTD performance of HSI -22%, HSI Tech Index -35%, HSI Properties -18.6%, and continued 23-25% short trading volume are set up for sharp rallies.
- Investment banks and brokers forecast economic recovery for buying in Q4 2022 or 2023.
- Overall volume continues to fall [something evident from HKEX share price as well].
Sands China Ltd: The Best Value Entry Point in the Sector as EVisa Easing Begins
- With five major China mainland markets expected to re-open by November, we see pent up demand sparking daily visitor footfall to Macau.
- Golden Week total arrivals could reach an aggregate 170,000 despite Beijing’s warning travelers to stay home. 2019 Golden Week drew 665,000 visitors.
- At HK$19.960 a share at writing, market sentiment does not yet appear to recognize the first meaningful easing in China travel bans since the 2020 lockdowns.
ShopBack Raises $80m from Temasek-Backed 65 Equity Partners
- ShopBack has entered into a subscription agreement to raise US$80 million in the second tranche of its series F round
The Singapore-based shopping and rewards platform’s latest backer is a Temasek-backed investment firm with US$3.3 billion in assets under management.
- Founded by Henry Chan and Joel Leong in 2014, ShopBack allows users to get cashback from their online and offline transactions
Buying Japanese Drug Store Names: Welcia (3141-JP) And Sundrug (9989-JP)
- Japan has been a favorite country since late-March, and we have continued to see improvement ever since.
- Vermilion’s international Group CS-35 Drug Stores, Japan displays bullish price and RS downtrend reversals, giving us added confidence that outperformance is likely to continue
- The two stocks highlighted today display base breakouts over the last couple of days, making them timely buys. Buy: Welcia Holdings (3141-JP) and Sundrug (9989-JP)
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