In today’s briefing:
- (Mostly) Asia-Pac M&A: Seven & I, Silverlake Axis, Shanghai Henlius, CPMC, Shinko Electric, Arvida
- Aspirasi Hidup Indonesia (ACES IJ) – The Ace Hardware Separation Is a Rebranding Opportunity
- SHEIN & Temu Updates: ‘De Minimis’ Threat | Chinese X-Border Slowdown | Plastics! | AMZN Project?
- TOPIX Revision May Be an Opportunity for Companies to Choose to Go Private
- Shivam Autotech Ltd- Forensic Analysis
- Raccoon Holdings, Inc. (3031 JP): Q1 FY04/25 flash update
(Mostly) Asia-Pac M&A: Seven & I, Silverlake Axis, Shanghai Henlius, CPMC, Shinko Electric, Arvida
- I tally 42 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
- Two new deals were discussed this week: the Taishin Financial Holding (2887 TT) / Shin Kong Financial Holding (2888 TT) merger; and Silverlake Axis (SILV SP)‘s hybrid Offer.
- Key updates took place on Huafa Property Services (982 HK), Shanghai Henlius (2696 HK),CPMC (906 HK), Seven & I (3382 JP), Shinko Electric (6967 JP), and Arvida (ARV NZ).
Aspirasi Hidup Indonesia (ACES IJ) – The Ace Hardware Separation Is a Rebranding Opportunity
- Ace Hardware Indonesia has been rebranded to Aspirasi Hidup Indonesia after the franchise agreement with ACE US was not renewed. Given ACES’s long-standing independence, we see this as an opportunity.
- The new names for the company will not be the brand names for the stores and Ace Hardware products are a tiny portion of the Indonesian company’s SKUs anyway.
- Concerns over the separation look overblown with ACES seeing a strong YTD performance above guidance with valuations looking attractive after recent share price weakness, with new store rollout ongoing.
SHEIN & Temu Updates: ‘De Minimis’ Threat | Chinese X-Border Slowdown | Plastics! | AMZN Project?
- Draconian ‘de minimis’ reform proposal in the US has bipartisan support
- In Q224 results, rampant signs of a Chinese X-border retail slowdown
- Other news: plastics laws, new Amazon threat, SHEIN sustainability initiatives
TOPIX Revision May Be an Opportunity for Companies to Choose to Go Private
- New TOPIX still has a large number of stocks and its components aren’t sufficiently liquid. TSE seems to have considered the companies that are under pressure to sell their shares.
- The challenge for companies excluded from TOPIX components should achieve sustainable growth by continuous review of their business portfolios to achieve growth that they could not achieve in the past.
- The company’s performance must be in line with the plan disclosed by the company in response to the TSE’s request. These companies should consider whether they should remain listed.
Shivam Autotech Ltd- Forensic Analysis
- Shivam Autotech (SVAT IN) or (SATL) serves OEMs by manufacturing a range of auto components and accessories including transmission gears, transmission shafts, etc.
- The company’s business performance over the last few years has looked grim with stagnant revenues, declining margins and ballooning losses. Balance sheet has only gotten more fragile.
- Auditor’s comments on material weakness on internal controls, increasing receivables, balance sheet ALM mismatch are few red herrings to look out for.
Raccoon Holdings, Inc. (3031 JP): Q1 FY04/25 flash update
- Revenue increased by 9.6% YoY to JPY1.5bn, with operating profit up 7.6% YoY to JPY300mn.
- EC business revenue rose 8.6% YoY to JPY866mn, while segment profit decreased 2.7% YoY to JPY299mn.
- Financial business revenue grew 11.0% YoY to JPY658mn, with segment profit down 44.7% YoY to JPY183mn.
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