In today’s briefing:
- Artisan Partners Writes a Letter To the 7&I Board (3382) – Meh…
- Quiddity STAR 50/100 Sep 24 Rebalance: 100% Hit Rate; US$1bn+ One-Way Flows
- BYD Vs Tesla: 1H 2024 Updates
- Alpha Generation Through Share Buybacks in Korea: Bi-Monthly (July and August 2024)
- HK Connect SOUTHBOUND Flows (To 30 Aug 2024); Weak Econ Data, But a Rebound in SB Net Buys
- ECM Weekly (2nd Sep 2024) – Midea, Terumo, Indigo, KIT, Kioxia, Bajaj Housing, Niva Bupa, Premier
- CR Beverage IPO: The Bull Case
- Weekly Consumer Tales: Meituan’s Margin Gain, H&H’s Pain, PDD’s Stock Crash
- China Consumption Weekly (2 Sep 2024): Alibaba, Huawei, Kuaishou, Li Auto, Haidilao
Artisan Partners Writes a Letter To the 7&I Board (3382) – Meh…
- On 30 August, 7&i shareholder Artisan Partners (holder since 2019, now at 1%) wrote an open letter to the Board of Directors of Seven & I Holdings (3382 JP)
- There are several comments in bold. “It is imperative that the board of directors negotiate with ACT immediately to achieve the best possible outcome for shareholders” is one.
- The letter is a bit preachy, a bit fluffy, and a bit misleading in parts. But it requests the Company brief shareholders on the negotiations by 19 September 2024.
Quiddity STAR 50/100 Sep 24 Rebalance: 100% Hit Rate; US$1bn+ One-Way Flows
- The September 2024 index review results for the STAR 50 and STAR 100 indices were announced after market close on Friday 30th August 2024.
- There will be 2 changes for the STAR 50 index and 6 changes for the STAR 100 index.
- The STAR 50 and STAR 100 rebalances will collectively trigger one-way flows of more than US$1bn during the September 2024 index rebal event.
BYD Vs Tesla: 1H 2024 Updates
- Recap of 1H 24 on two of the largest and most influential EV makers; Tesla (TSLA US) and BYD (1211 HK) .
- BYD performance is superior to Tesla yet it trades at a discount to Tesla, notably 0.2x vs 3x PEG.
- BYD faces tailwinds in North America and the EU, but those are not its main destinations.
Alpha Generation Through Share Buybacks in Korea: Bi-Monthly (July and August 2024)
- In this insight, we discuss the alpha generation through companies that have been buying back their shares in the Korean stock market in July and August 2024.
- On average, the share buyback announcements by 46 companies represented 2% of outstanding shares.
- Major companies that have announced share buybacks in Korea in the past two months include KT&G, Mirae Asset Securities, and POSCO Holdings.
HK Connect SOUTHBOUND Flows (To 30 Aug 2024); Weak Econ Data, But a Rebound in SB Net Buys
- SOUTHBOUND was a net seller the prior week for HK$1.5bn, the first week in 29 where SB was a net seller. It was all ETFs. Stocks were a net buy.
- This week, they reverted to net buying. Financials and Utilities were strong net buys. ETFs again a net sell. Total SOUTHBOUND volumes also picked up.
- SOEs, SOE Banks, Energy, Utilities, and finally Anta Sports Products (2020 HK) saw net buying after salutary earnings.
ECM Weekly (2nd Sep 2024) – Midea, Terumo, Indigo, KIT, Kioxia, Bajaj Housing, Niva Bupa, Premier
- Aequitas Research’s weekly update on the IPOs, placements, lockup expiry and other ECM linked events that were covered by the team over the past week.
- On the IPO front, we looked at Kioxia Holdings (6600 JP), Bajaj Housing Finance (BHF IN) and Niva Bupa Health along with Premier Energies.
- Placement were flowing through again this week, mainly across India and Japan.
CR Beverage IPO: The Bull Case
- China Resources Beverage (CRB HK), China’s largest purified drinking water company, has received HK listing approval for a US$1 billion IPO.
- CR Beverage has a product portfolio of 13 brands, including C’estbon, Zhi Ben Qing Run, Mi Shui Series, Holiday Series and Zuo Wei Cha Shi, comprising 56 SKUs.
- The bull case rests on a large TAM, a core business in good health, beverages providing the second growth leg, profitability, and strong cash conversion.
Weekly Consumer Tales: Meituan’s Margin Gain, H&H’s Pain, PDD’s Stock Crash
- Welcome to Consumer Tales & Trends, your weekly roundup of the latest corporate developments, investment reports and sector events in the consumer industry.
- Meituan (3690 HK) reported robust revenue and profit growth amidst broader struggles in the F&B industry raises questions on industry dynamics and momentum sustainability.
- Health And Happiness (1112 HK) faced another quarter of declining revenue and profits, but reported a significant rise in cash generated from operations thanks to improved inventory turnover.
China Consumption Weekly (2 Sep 2024): Alibaba, Huawei, Kuaishou, Li Auto, Haidilao
- The tension between the government and Alibaba was eased, as the authorities closed the rectification course on Alibaba.
- Huawei’s total revenue increased by 34% YoY in 1H24, as the smartphone sales surged.
- Kuaishou will provide a subsidy of US$56 million to e-commerce broadcasters.
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