Daily Brief Consumer: Kangwon Land, Alibaba Group Holding , Midea Group Co Ltd A, CJ Corp, Porsche Automobil Holding , The Keepers Holdings, Evolable Asia, Murree Brewery, Pigeon Corp, Rizap Group and more

• The September KOSPI Size Index rebalancing could bring back the typical price impacts seen over the past decade, unlike the March rebalancing.
• The previous rebalancing had anomalies due to newly listed stocks in LARGE and a stronger downward trend in LARGE-to-MID transitions, disrupting the expected price impact.
• For September’s rebalancing, fewer distortions are expected compared to March. The NPS Mid to Small Cap fund, a key influence, shows no significant changes in benchmark or AUM.

• Alibaba’s revenue grew by 4% YoY in 1Q25 due to the stagnancy in e-commerce.
• However, many expansion plans follow, including overseas market, physical stores, and fresh food wholesale.
• We set an upside of 51% and a price target of HK$115 for March 2025.

• Midea Group Co Ltd A (000333 CH) has got approval to list on the HKEX (388 HK) and reports are that the listing could be up to US$3bn.
• That issue size is around half of the maximum that the company can issue. But it would still need cornerstone investors and a nice discount on the H-shares.
• The stock will still get included in some indices even with the scaled down size, and inclusion in Southbound Stock Connect is a given.

• In this insight, we discuss how Warren Buffett’s recent investment in Ulta Beauty is likely to have a positive impact on CJ Corp’s valuation. 
• CJ Olive Young (largest shareholder is CJ Corp) is the dominant health & beauty cosmetics chain in Korea. CJ Olive Young has a similar business model to Ulta Beauty.
• Our NAV analysis suggests an implied market cap of 4.7 trillion won or implied price of 160,977 won per share for CJ Corp, representing a 38% upside from current levels.

• Porsche SE is trading at a 35.3% discount to NAV, vs. 32.4% long-term average, implying a 68% probability that Porsche SE will be liable for c. €6.5 billion legal claims.
• I think this is too harsh. Shares are trading at a Fwd P/E of 2.5x and a dividend yield of 7.8%, which I consider very attractive. 
• Porsche SE presents an attractive opportunity to gain exposure to Volkswagen and Porsche AG. Porsche SE is focusing on deleveraging which should drive a reduction in the discount.

• The Keepers Holdings (KEEPR PM) reported a stellar H1 2024, with revenue up 19% YoY and profits up 23% YoY, led by volume growth of 22% YoY.
• Gross margins were maintained at 28%, and operating margins were 20.6%. The company remained net cash (2.7 bn pesos) despite distributing two years worth of dividends in H1 2024
• Trading at 7.7x PE, a 6% dividend yield, and with the structural tailwinds of premiumization in alcohol, we love the name. 

• Volume handled increased by 20.2% YoY to JPY87.1bn, with operating revenue up 10.3% YoY to JPY18.5bn.
• Gross profit forecasts for Q3 FY09/24 are JPY1.2bn for July, JPY1.0bn for August, and JPY970mn for September.
• Operating profit for Q3 FY09/24 was JPY2.7bn, maintaining the same level as FY09/23 while executing growth investments.

• Murree Brewery is a prominent alcohol producer in Pakistan with a monopoly in the beer market.
• Established in 1860, it is the oldest enterprise in Pakistan and one of the first modern breweries in the region.
• The company derives half of its sales from alcohol products and the other half from non-alcoholic branded food and beverage items.

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.

• Sales increased 6.9% YoY, with Japan segment sales declining and growth in China, Singapore, and Lansinoh segments.
• Operating profit decreased 10.6% YoY, with increases in Singapore and Lansinoh segments but declines in Japan and China segments.
• Net income attributable to owners fell 21.7% YoY due to a suspicious transaction in China, resulting in a JPY392mn loss.

• Revenue increased by JPY4.2bn YoY, with chocoZAP membership revenue offsetting declines in the Lifestyle segment.
• Rizap-related businesses posted revenue of JPY11.9bn, driven by chocoZAP, and MRK Holdings saw increased revenue and profit.
• REXT Co., Ltd. recorded revenue of JPY10.3bn, with declines in the entertainment business but increases in the reuse business.