Daily Brief Consumer: Seven & I Holdings, Vitasoy Intl Holdings, Fosun Tourism, FineToday Holdings Co Ltd, GENDA , Deliveroo, Hyundai Motor, China Dongxiang and more

• The Seven & I Holdings (3382 JP) to rid itself of control of the Ito-Yokado, York Benimaru, Akachan Hompo, and Denny’s Japan businesses in York Holdings proceeds apace.
• The First Round of bids is due tomorrow, apparently, and all manner of bidders have assembled. 
• This leads to the question of a deal for the rest of 7&i. If a TradingCo is a natural co-investor for the Ito family (or ACT), so is Berkshire Hathaway.

• Yesterday, beverage maker Vitasoy Intl Holdings (345 HK) announced a 1H25E (Mar Y/E) net profit of HK$171mn, a 4.8% gain yoy. An interim dividend of HK$0.04/share (HK$0.014/share in 1H24), was declared.
• What was absent from the announcement/briefing was any comment on Philip Ng Chee-tat’s and Yeo Hiap Seng (YHS SP)‘s recent buying in Vitasoy.
• Ng, the younger brother of Sino Land (83 HK)‘s chairman Robert Ng Chee-siong, indirectly holds 12.26%, up from 5.22% on the 7th October. The share price is up 104% since.

• NHK reports that Seven & I Holdings (3382 JP)‘s first bidding round for a YORK Holdings stake ends on 28 November. The sale provides a third-party valuation benchmark for the asset. 
• It is an incremental positive for the founding family MBO as it supports the post-privatisation strategy and assists in securing bank financing.
• This is an incremental negative for Alimentation Couche-Tard (ATD CN) as it shows that the Board believes the restructuring plan will increase shareholder corporate value.  

• Fosun Tourism (1992 HK) a leisure-focused integrated tourism group, is currently suspended pursuant to the Takeovers Code.
• Fosun Tourism was spun off from Fosun International (656 HK) in December 2018. Fosun Int’l currently holds 79.45% of shares out. 
• Fosun Tourism gained ~8% yesterday on the highest volume in over two years. Recent news concerned Temasek-backed CapitaLand Investment (CLI SP) taking a 20-30% stake in Fosun Tourism’s subsidiary Club Med.

• CVC Capital is aiming to raise over US$500m, via selling some of its stake in FineToday Holdings Co Ltd (289A JP)in Japan.
• FineToday (FT) is a beauty and personal care company in Asia offering a range of products, including hair care, skin care and body care products.
• In our previous note, we looked at the company’s past performance. In this note, we will undertake a peer comparison.

• Gravitation towards businesses with traditional competitive advantages and large reinvestment runways for future outperformance
• Genda’s growth primarily through mergers and acquisitions in the Japanese entertainment industry, taking advantage of the aging population of business owners
• CFO Taiju Watanabe’s background in Goldman Japan Investment Banking and transition to Jinda, highlighting the company’s potential for growth and profitability

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• Vitasoy Intl Holdings (345 HK)’s shares surged 19.5% on speculation that billionaire Philip Ng will launch a takeover offer due to recent share purchases.  
• Philip Ng’s stakebuilding suggests three potential outcomes. The likely near-term outcome is that he continues to nudge up his stake and potentially seek Board representation.
• Without the Lo family’s support, a scheme privatisation is impossible. While a voluntary conditional offer is possible, it isn’t very likely, as Vitasoy’s valuation looked frothy at the last close.  

• In this insight, we take a look at the potential index changes for F100 and F250 in the run-up to the December 2024 index rebal event.
• Currently, we see three F100 changes and four F250 changes. Some of these index change expectations are related to the changes made to the UK Listing Rules in June 2024.
• The final changes will be decided based on 3rd December 2024 closing prices.

• On 27 November, Hyundai Motor (005380 KS) announced that it plans to buy back 1 trillion won worth of its shares (700 billion won to be cancelled).
• Trump’s aggressive tariff policy has been one of the major factors negatively impacting Hyundai Motor’s share price in the past several months. 
• Hyundai Motor’s valuation has become more attractive.  There are also other investments such as its stakes in Boston Dynamics and Hyundai Motor India that could be valued higher. 

• China Dongxiang (3818 HK) turned around in 1H FY25 as it reported a net profit of Rmb137m, vs. losses of Rmb410m a year ago. Interim DPS increased 92.7% YoY.
• Investment gain is the key driver, reaching Rmb171m in the period, compared with losses of Rmb497m previously. Most investment categories contributed positively. 
• CDNX trades on a 76.9% discount to its SOTP value and a P/B of just 0.22x. Net cash amounted to Rmb3.2bn, or 58.3% more than its market capitalisation.