In today’s briefing:
- Saizeriya (7581 JP): Improvement In Profitability In Japan Materialized in 3Q24
- Quiddity Leaderboard BSE/SENSEX Dec 24: Could Zomato’s Share Price Rally Become a Problem?
- Canon Marketing Japan (8060 JP): 1H FY12/24 flash update
- Although the Cost of Capital for CBs Should Be Considered Much Higher than for SBs
- GTX: Value from Impatience
- Pvh Corp – VNCE: Snapping the Store: Pre-Fall Continues to Impress; Reiterate Buy, $3 PT
- Narrative and Numbers | Shoppers Stop (SHOP IN) | FY24
Saizeriya (7581 JP): Improvement In Profitability In Japan Materialized in 3Q24
- Since the release of 3Q24 (YE August) results on July 10, the share price of Saizeriya (7581 JP) is up nearly 10%, greatly outperforming Nikkei during the same time frame.
- The 3Q24 results showed that Japan’s operating profit finally improved, while China remained solid.
- The company is currently trading at 24x 2025E PE with strong earnings growth.
Quiddity Leaderboard BSE/SENSEX Dec 24: Could Zomato’s Share Price Rally Become a Problem?
- In this insight, we take a look at the Potential ADDs/DELs for the BSE SENSEX, 100, and 200 indices in the December 2024 index rebal event.
- At present, 3 changes for the BSE 100 index and 7 changes for the BSE 200 index.
- The BSE 100 handling rules for names without futures and options (F&O) sometimes punish companies that have enjoyed good share price rallies and Zomato could get into such a trap.
Canon Marketing Japan (8060 JP): 1H FY12/24 flash update
- Sales rose 5.3% YoY to JPY318.9bn, driven by strong SI and IT infrastructure services; operating profit fell 3.9% YoY.
- FY12/24 sales forecast revised to JPY650.0bn (+6.6% YoY) due to Primagest acquisition and strong IT solutions performance.
- Segment forecasts: Consumer sales flat, Enterprise sales JPY236.2bn (+7% YoY), Professional sales JPY44.0bn (+9% YoY).
Although the Cost of Capital for CBs Should Be Considered Much Higher than for SBs
- We need to watch carefully to see whether cash flow will subsequently increase in the projects that the CB issuers have invested their proceeds in.
- Share prices of companies that announce equity financings, including CBs, usually decline. Besides the dilution, another aspect is the effect of the company’s announcement of the sale of its shares.
- In the case of CBs, the company should keep in mind that it sold the conversion rights of its shares for less than their actual call option value.
GTX: Value from Impatience
- GTX reported Q2 results missing our estimates as demand for turbochargers softened in quarter. The magnitude of the sales miss was amplified by deflationary cost pass throughs.
- GTX was successful in maneuvering its cost structure at the beginning 2024 resulting in gross margin exceeding our estimate and adjusted EBITDA declining by a significantly smaller amount than sales.
- We were already towards the low end of GTX’s previous guidance range anticipating uncertainty. Our adjustments to 2024 and 2025 adjusted EBITDA estimates are minimal.
Pvh Corp – VNCE: Snapping the Store: Pre-Fall Continues to Impress; Reiterate Buy, $3 PT
- We are reiterating our Buy rating, projections and $3 price target for Vince after visiting stores in Long Island, Connecticut and New Jersey.
- We believe the company continues to roll out winning collections, with a focus on compelling hues (dark scarlet and blue waltz), new items (cargo pants, shrunken camisoles, silk hooded shirts and cardigan sweaters) and a deeper focus on key categories such as dresses.
- Further, we are also seeing continued newness and expansion in men’s, driven by jackets, button front shirts (in patterns and textures) and the beginnings of a colder weather focus on long sleeve items, including the return of the waffle shirt jacket.
Narrative and Numbers | Shoppers Stop (SHOP IN) | FY24
- Shoppers Stop (SHOP IN) is a leading retailer in India specializing in fashion and beauty brands with 12 department stores, 7 premium home stores, and 87 specialty beauty outlets,
- SHOP has also launched its value retail format INTUNE in June 2023 generating excitement and interest around the same.
- It seems SHOP is trying to play all cards of the retail game, i.e., premium, beauty, and value fast fashion, but so far has shown no signs of success.
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