In today’s briefing:
- Poly Culture (3636 HK): Trading Wide To Terms. Get Involved.
- HSTECH Index Rebalance Preview: Round-Trip Trade of US$255m in December
- Haitian Flavouring (603288 CH): Weakening Moat With Further Derating Likely
- US Judge Rules Favorably for Okada Manila Dispute with Former Spac Partner
- Dollar General Corporation: Activist Interest Looms After Recent Drop! – Major Drivers
- Hormel Foods Corporation: Unveiling the Powerhouses Behind Their Volume Boost! – Major Drivers
- Lululemon Athletica Inc.: Tapping into International Markets – A Game-Changing Move? Major Drivers
- Chewy Inc.: Delving Into The Major Drivers Taking The Company Forward! – Financial Forecasts
Poly Culture (3636 HK): Trading Wide To Terms. Get Involved.
- Back on the 27 June, art and culture play Poly Culture Group Corp H (3636 HK) announced a pre-conditional privatisation at HK$8.88 per H-share.
- This Offer from SOE Poly Group is by way of a Merger by Absorption, incorporating a Scheme-like vote. There is no tendering condition.
- The pre-cons have now been fulfilled. The Composite Document, including the H Share Class meeting/EGM date and IFA opinion, is expected to be despatched on or before the 30 September.
HSTECH Index Rebalance Preview: Round-Trip Trade of US$255m in December
- With no stocks in inclusion or deletion zone, we do not expect any constituent changes for the Hang Seng TECH Index (HSTECH INDEX) in December.
- Capping changes will result in a one-way turnover of a touch below 1% and that will result in a round-trip trade of US$255m.
- The impact on the stocks is relatively small for now but that could increase till the end of November when the stocks will be capped.
Haitian Flavouring (603288 CH): Weakening Moat With Further Derating Likely
- Foshan Haitian Flavouring & Food (603288 CH), the largest condiment player in China is facing structural weakening of moat from a changed operating environment post-COVID.
- Both catering and home consumption segments are faced with structural growth pressures that are difficult to solve for the company.
- Expect further earnings weakness and derating in valuation multiple in the near term.
US Judge Rules Favorably for Okada Manila Dispute with Former Spac Partner
- Japan’s Universal Entertainment’s Okada Manila casino unit removes another obstacle to its long quest to transform into a NASDAQ traded IPO.
- Judge rules that Okada is free of any obligations to US Space 26 Capital Partners.
- UE’s goal to take the casino public, despite expectations that the Spac will appeal, is likely to move forward toward identifying a new partner.
Dollar General Corporation: Activist Interest Looms After Recent Drop! – Major Drivers
- Dollar General Corporation’s results were a major disappointment as the company failed to meet Wall Street’s revenue and earnings expectations.
- Due to higher average borrowing amounts and interest rates, interest expense climbed to $84 million in Q2 from $43 million in Q2 of last year.
- Dollar General has experienced a significant drop in its stock value this year, sparking speculation about potential activist investors eyeing the company.
Hormel Foods Corporation: Unveiling the Powerhouses Behind Their Volume Boost! – Major Drivers
- Hormel Foods Corporation delivered a disappointing set of results as the company was unable to meet the revenue expectations as well as the earnings expectations of Wall Street.
- Additionally, Hormel Foods recently introduced an LTO for the fall season: apple cider donut-flavored cashews, which the team anticipates will increase category volume and attention.
- Hormel Foods noticed a recovery across the turkey portfolio in its Retail segment and increased volume in important categories.
Lululemon Athletica Inc.: Tapping into International Markets – A Game-Changing Move? Major Drivers
- Lululemon Athletica delivered an all-around beat in the previous quarter, exceeding the management’s projections for revenue and EPS.
- Comparable sales increased by 17% online and 9% in-store, and adjusted EPS rose by 22% over the same time last year.
- In July, Lululemon Athletica established its first site in Thailand, making it the 100th APAC facility overall.
Chewy Inc.: Delving Into The Major Drivers Taking The Company Forward! – Financial Forecasts
- Chewy delivered a solid result and managed an all-around beat in the last quarter, producing mid-teens growth that exceeded expectations as well as strong profitability.
- The number of active customers was almost steady sequentially, but the net sales per active customer, or NSPAC, rose by 15% to $530.
- Net sales growth was boosted by active customer participation, highlighting the steadily growing strength of the Chewy ecosystem.
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