Daily Brief Consumer: Shiseido Company, BYD, Dhampur Bio Organics, Zegna, Miniso, Marriott Vacations World, Card Factory, Pvh Corp, Five Below, Topbuild Corp and more

• Nippon Paint Holdings (4612 JP) is a branded decorative paint player.  China made up nearly 40% of the operating profit of the company. 
• Saizeriya (7581 JP) is a Japanese restaurant chain of fast casual Italian food, with currently the majority of operating profit and growth coming from China.
• Shiseido Company (4911 JP) is a Japanese beauty company that relies heavily on China.

• China’s key electric-vehicle (EV) makers set monthly delivery records in September as government subsidies and price cuts gave sales in the fiercely competitive industry a boost.
• BYD Co. Ltd. (002594.SZ +8.21%), the country’s top EV-maker, sold 419,426 vehicles in September, according to an exchange filing Tuesday.
• The figure, which consisted of 164,956 battery EVs and 252,647 plug-in hybrids, marked a 45.9% year-on-year increase and a new monthly sales record.

• Dhampur Bio Organics (DBOL IN): Integrated sugar manufacturer listed in 2022 post demerger from Dhampur Sugar Mills (DSM IN) 
• With change in Ethanol policy from Sep-24, Company will be significantly benefitted with its grain-based ethanol plant and higher sugar production with good monsoon. 
• Company is reducing its debt significantly to deleverage its balance sheet.

• Ermenegildo Zegna Group recently provided an overview of its financial performance and strategic initiatives for the first half of the fiscal year 2024.
• Despite operating in a challenging global environment, particularly within the luxury sector, the company reported year-over-year revenue growth of 6%, supported by the consolidation of Tom Ford fashion and the ongoing strength of the Zegna brand.
• This growth translated into a gross profit of EUR 637 million and an adjusted EBIT of EUR 81 million.

• Despite the drastic bull turn in Chinese equity sending MNSO’s share 41% from its trough, we see MNSO’s investment in Yonghui Superstores as a risk venture.
• We believe the market has overestimated the scalability of the Pangdonglai rectification program for offline retail. 
• We downgrade the stock to SELL rating and cut TP to US$18/ADS

• Marriott Vacations Worldwide reported mixed financial results for the second quarter of 2024.
• The quarter saw slight growth in tours, potentially due to an emphasis on attracting new members, but this was mitigated by a decline in Vacation Ownership Point Generations (VPGs), especially among first-time buyers, which has impacted the overall contract sales negatively.
• The company highlighted flat VPGs among existing owners, indicating sustained interest and valuation of vacations among this group.

Card Factory’s H125 revenue growth demonstrated it is delivering well against its multi-year growth strategy. While profitability was negatively affected by the (mostly) known inflation in operating costs, management is confident Card Factory will achieve its full-year estimates. This is due the momentum in the business and the mismatch in H125 between cost inflation and the efficiency and cost savings that have always been expected to come through in H225.

• PVH Corp. reported its financial results for the second quarter of 2024, reflecting a blend of successes and strategic pivots amidst a challenging global economic environment.
• Under the leadership of CEO Stefan Larsson, PVH Corp. has managed to align its performance with guidance expectations while surpassing estimates on profitability.
• The quarter showcased a revenue performance in line with PVH’s projections, with a noteworthy increase in EBIT margins owing to a significant 250 basis point expansion in gross margins.

• Five Below’s second-quarter results for fiscal 2024 reflect a period of significant changes and challenges alongside the initiation of strategic shifts aimed at repositioning the company for future growth.
• Under the interim leadership of Kenneth Bull, following a recent CEO transition, the company undertook a detailed review of its operations and business strategy.
• This quarter’s earnings reveal some concerning trends but also highlight areas where management is actively working to steer the business back to its growth track.

• TopBuild Corp. delivered a robust performance in the second quarter of 2024, reflective of a solid growth trajectory despite challenges posed by the higher interest rate environment and supply chain constraints.
• The company capitalized on opportunities across its diverse business model, supporting long-term growth despite the headwinds affecting the residential and commercial sectors.
• Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology.