In today’s briefing:
- Coinbase: From Sleeping Giant To Industry Leader
- Cambodia’s New Gaming Laws Reduce More than 50% of Legal Casinos: Nagacorp Expands Geographic Reach
- Global Digital Niaga (BELI IJ) – BliBli Ploughing a More Profitable Furrow
- Airport of Thailand (AOT): Not the Right Time
- Remitly – Rev +49% | ROW Rev +120% | Scaling: COGS -25% | Adj EBITDA Margin 2Q23 Is 8.7%, Highest
- BeiGene (6160.HK/BGNE.US) – The Truth Behind Novartis’ Divorce Decision on PD-1
- UMC (2303.TT; UMC.US): The Revenue Can Be Downward a Bit in 4Q23F.
- Yamazaki Baking: Breads & Buns Buonce But Valuation Is a Stalemate
- PHC Holdings (6523 JP): Despite Slow Start, FY24 Guidance Reiterated; Diabetes Can Be a Sweet Spot
- Chip Designer Arm Committed to China, CEO Says
Coinbase: From Sleeping Giant To Industry Leader
- Coinbase sees the looming opportunity in the global crypto futures & derivatives market. It’s positioning itself to capitalize on a market that’s been hollowed out over last 12-18 months.
- We explore 3 key areas of Coinbase’s business that we believe Wall Street is overlooking. These include: Coinbase International, ETF Spot approvals, and Base Chain
- We estimate Coinbase has the potential to realize additional top-line revenue in the range of 15-20% on the low-end to +150% increase on the high-end over the next few years.
Cambodia’s New Gaming Laws Reduce More than 50% of Legal Casinos: Nagacorp Expands Geographic Reach
- From 200 properties, the Cambodian government now only allows 87 shrinking capacity but increasing footfall for existing properties like Nagaworld in Phnom Penh.
- Nagaworld enjoys a moat in metro Phnom Penh–this supply reduction expands its base.
- H1 performance strong, reduced national capacity will contribute to revenue gains from a wider geography for the largest single integrated luxury resort in Cambodia.
Global Digital Niaga (BELI IJ) – BliBli Ploughing a More Profitable Furrow
- Global Digital Niaga (BliBli) continues to stand out from peers given a differentiated omnichannel model plus a greater portion of 1P but 3P sales are growing driven by Tiket.com.
- TPV growth surpassed revenue growth in 1H2023 driven by Tiket.com but take rates and gross margins improved, as the company cut back on promotional spending and improved cost efficiencies.
- BliBli booked organic growth with more users and a significant pick-up in the average order value, partially driven by Tiket.com.
Airport of Thailand (AOT): Not the Right Time
- Visa-Free travel for Chinese tourists is certainly a boost for the Airports of Thailand (AOT TB) .
- Compared to 2019 operational numbers, the 2023 number is still very low despite the large YoY gain thanks to the low base in 2022.
- The valuation is still high as the share price has run ahead of its fundamentals.
Remitly – Rev +49% | ROW Rev +120% | Scaling: COGS -25% | Adj EBITDA Margin 2Q23 Is 8.7%, Highest
- Remitly (RELY) offers remittances services with 5m active customers, in over 170 countries, with 4 billion bank accounts, and 4,800 corridors, mostly to persons in US, Canada.
- Revenue growth is strong at 49% YoY in 2Q23 and averaging 43% YoY for the preceding 5 quarters, with active customers up 474,000 in 2Q23 QoQ vs 371,000 in 1Q23
- Costs remain high, GAAP earnings are in loss, but this is due to stock-based compensation; adjusted EBITDA is now USD20.4m in 2Q23 from an adjusted EBITDA loss YoY
BeiGene (6160.HK/BGNE.US) – The Truth Behind Novartis’ Divorce Decision on PD-1
- Novartis’ return of PD-1 to BeiGene may actually have nothing to do with TIGIT project. Long-term strategic adjustment and decreasing value of tislelizumab to Novartis could be the core reasons.
- Abandoning PD-1 is a simple decision for Novartis, but not for BeiGene, who will do its best to promote FDA approval for tislelizumab, aiming to expand internationalization and stabilize valuation.
- We advise investors not to focus too much on whether or not tislelizumab will eventually get FDA approval,because the actual peak sales tislelizumab can contribute to BeiGene could be disappointing.
UMC (2303.TT; UMC.US): The Revenue Can Be Downward a Bit in 4Q23F.
- The upcoming demand is expected to reduce in 4Q23F, with the most obvious decline in 40nm and 8″ demand.
- Wafer ASP is expected to remain relatively stable until 4Q22F, even though revenue is not anticipated to pick up in 1H24F.
- We expect the market to reach its lowest point in the first half of 2024F. The most likely scenario indicates a potential recovery around the third quarter of 2024F.
Yamazaki Baking: Breads & Buns Buonce But Valuation Is a Stalemate
- While Yamazaki Baking (2212 JP)‘s recent surge has been impressive, consensus expectations are high for the upcoming quarter, despite yet another price hike in July 2023.
- From a valuation perspective, we expect limited upside potential even if Yamazaki Baking surpasses consensus expectations.
- Therefore, we believe that the risk-reward profile for maintaining a long position in Yamazaki Baking is currently not particularly attractive.
PHC Holdings (6523 JP): Despite Slow Start, FY24 Guidance Reiterated; Diabetes Can Be a Sweet Spot
- Despite the absence of special demand related to COVID-19, PHC Holdings (6523 JP)’s Q1FY24 revenue of ¥81.3B was at the same level as Q1FY23 due to favorable Fx impact.
- Operating profit declined 16% YoY to ¥1.7B, due to lower profit in the diabetes management business and a drop in the volume of PCR testing.
- PHC guided for FY24 revenue of ¥355.5B and operating profit of ¥29.3B (+47% YoY). The company expects FY24 net profit of ¥15.6B from a net loss of ¥3.2B in FY23.
Chip Designer Arm Committed to China, CEO Says
British chip designer Arm Holdings Plc remains committed to China and to working closely with its mainland-based partner following its $4.87 billion IPO, according to chief executive Rene Haas.
The Softbank-backed firm floated in New York last week via the world’s largest public offering year-to-date. But that has not affected its strategy globally.
- Shanghai-headquartered Arm Technology (China) Co. Ltd., also known as Arm China, operates independently and is the exclusive licensing platform of Arm’s global intellectual property in China
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