In today’s briefing:
- 2023 High Conviction – Anycolor (5032) Aiming at TSE Prime and TOPIX – And How!
- Premier Anti-Aging Company: DUO Is Going Down
- Tokyo Electron (8035) | Huge Upside if Management Hit Targets
- Sa Sa Intl (178 HK): Is It Too Late to Buy Now?
- Fujifilm: An Inspiring Transformation Story
- Kakao Corp: FTC Going After Chairman Kim Beom-Su’s K Cube Holdings
- Taiwan Dual-Listings: Premiums Bounced… And Have Now Declined Again
- Lotte Shopping: A Deep Value Stock Poised for a Turnaround
- Askul Q2 23 Results Reaction: B2B Growth and B2C Cost Savings Drive Solid Quarter
- Zydus Lifesciences (ZYDUSLIF IN): New Launches Aid US Business; India Business Continued to Progress
2023 High Conviction – Anycolor (5032) Aiming at TSE Prime and TOPIX – And How!
- “VTuber” (Virtual Youtuber) animated influencer company Anycolor (5032 JP) was listed on 8 June 2022 at ¥1530. The stock popped 214% on Day1.It is up another 60% since then.
- Today Anycolor reported Q2 earnings (result, presentation) and revised its full-year forecast to 30 April. Revenues will be +7-18% vs forecast, OP +18-39%, NP +15-39%. Price is 43x forecast EPS.
- The company also announced it is preparing a Section Transfer application, but gave little more info. So we dig into what THAT means.
Premier Anti-Aging Company: DUO Is Going Down
- Premier Anti-Aging (4934 JP) shares rose 6.1% today following a massive earnings miss and a substantial downgrade to FY23 guidance.
- This is perhaps due to low liquidity and depressed prices as the share price dropped more than 85% since July last year.
- We think there’s more downside to the stock, especially with DUO about to hit the bottom of the barrel and CANADEL and Clayence struggling to maintain growth momentum.
Tokyo Electron (8035) | Huge Upside if Management Hit Targets
- Tokyo Electron is a structural growth stock that has fallen by 31% YTD reflecting near term risks to growth and margins
- We believe that the digitization of society has only just begun and that data volumes will grow exponentially
- We analyse TEL’s core value drivers – revenue, margins, risk and reinvestment – and see 38% upside
Sa Sa Intl (178 HK): Is It Too Late to Buy Now?
- We think Sa Sa International Hldgs (178 HK)‘s risk-return payoff still look favourable even after the recent rally, which rides on the expectations of HK-mainland China border opening.
- Assuming net profit returns to 70% of pre-pandemic level in FY25, and applying a peak PER of 25x over 2011-2018, its share price still has 63% upside.
- Release of pent-up demand, stabilisation of gross margin trend, improved cost dynamics and manageable financial position are all positive factors for Sa Sa.
Fujifilm: An Inspiring Transformation Story
- Established as a domestic photographic film manufacturing company, Fujifilm has successfully evolved into a healthcare company with majority revenue earned from medical and life science related businesses.
- Fujifilm is now a leading player in Bio CDMO market through a combination of acquisitions and in-house developed capabilities. The company has gained recognition among leading pharmaceutical companies.
- We think there is further upside to Fujifilm’s valuation multiples as the market still values the stock as an image/photography company and not in line with healthcare peers.
Kakao Corp: FTC Going After Chairman Kim Beom-Su’s K Cube Holdings
- On 15 December, it was announced that Korea’s FTC decided to refer K Cube Holdings (KCH) to the prosecution over alleged illegal execution of voting rights to Kakao companies.
- This could signal that the financial regulators may become more forceful in enforcing numerous other regulatory pressures on Kakao Corp and its affiliated companies to reduce their monopolistic business practices
- Our NAV valuation of Kakao Corp suggests NAV per share of 45,942 won, which is 17% lower than current price.
Taiwan Dual-Listings: Premiums Bounced… And Have Now Declined Again
- TSMC — Small premium currently, recent trading range appears unaffected by Buffett investment
- UMC — Bounced from discount to premium, now at a discount again
- ChipMOS — Bounced from discount to premium, now back to a decent discount
Lotte Shopping: A Deep Value Stock Poised for a Turnaround
- Lotte Shopping is a deep value stock poised for a turnaround.
- Lotte Shopping has clear turnaround catalysts, cheap valuations, and a solid technical setup.
- Perhaps the most important catalysts for Lotte Shopping include getting rid of the most restrictions/social distancing measures related to COVID-19 which have been in place in the past three years.
Askul Q2 23 Results Reaction: B2B Growth and B2C Cost Savings Drive Solid Quarter
- Results for Q2 were better than we expected as B2B sales growth remained robust whilst cost savings on the consumer side boosted margins
- A rather robust decline in revenue for Lohaco is the only negative that stands out but this was partially anticipated whilst the corresponding cost savings are a boon
- An 11% increase in operating profit for Q2 offsets weakness from the previous report and puts the company on track to meet guidance for full-year growth
Zydus Lifesciences (ZYDUSLIF IN): New Launches Aid US Business; India Business Continued to Progress
- In Q2FY23, Zydus Lifesciences Ltd (ZYDUSLIF IN) recorded 16% y/y and 10% q/q growth in the U.S. formulation business, mainly driven by new launches including gRevlimid.
- India formulation business continued to progress well, with market share gain in key therapies including cardiovascular, gynecology, respiratory, and gastro intestinal on a y/y basis.
- Zydus remains confident to achieve 20% plus EBITDA margin for the current fiscal, backed by growth visibility across key businesses, coupled with various cost optimization initiatives.
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