In today’s briefing:
- Taste Gourmet (8371 HK): Q3 FY24 Preview and Future Catalysts
- Fast Retailing: Earnings Preview
- Top 20 Korean Construction Companies: Off-Balance Sheet Contingent Liabilities To Drive Lower Prices
- Bajaj Finance: Q3FY24 Preview
- Alteogen (196170 KS): First Proprietary Product Approval in Korea To Improve Revenue Visibility
Taste Gourmet (8371 HK): Q3 FY24 Preview and Future Catalysts
- We expect Q3 FY24 revenues/profits to be >40%/>70% YoY for Taste Gourmet (8371 HK) for their results in early February.
- Another catalyst we look forward to in CY24 is the main board listing on HKex. The timeline, we believe, should be in the second half of the year.
- Trading at 6x PE with an 8.5% dividend yield and cash of 130 mn HKD, or about 21% of the market cap, is one of our top dividend gems.
Fast Retailing: Earnings Preview
- While domestic revenues may have slowed, Uniqlo’s domestic OP shows upside potential driven by gross margin growth and a gradual reduction in SG&A costs.
- Meanwhile, we expect Uniqlo’s International business OP to surpass ¥75bn, driven by a rebound in China demand and strong momentum in South Korea, SE Asia & Ocenia.
- Thus, we see the upcoming earnings as a compelling opportunity for trading Fast Retailing (9983 JP).
Top 20 Korean Construction Companies: Off-Balance Sheet Contingent Liabilities To Drive Lower Prices
- We argue that the top 20 listed construction companies in Korea are likely to underperform KOSPI in 2024 mainly due to the excessive risks in the housing/commercial real estate sectors.
- We expect the share prices of these 20 domestic construction companies to fall by at least 15%-20%+ on average in the next 6-12 months.
- On 2 January 2024, Financial Supervisory Service (FSS) announced that there will be new reporting requirements for PF loans of Korean construction companies starting 2023 annual reports.
Bajaj Finance: Q3FY24 Preview
- Bajaj Finance Ltd (“BAF”) reported key performance metrics for Q3FY24. It reported strong growth, particularly in AUM which grew 7%+ QoQ and 35% YoY to reach INR 311,000cr.
- Customer franchise grew 5%+ QoQ to reach 80.41mm, surpassing the 80mm mark. New loans booked grew to 9.86mm, a growth of 26% YoY and 15%+ QoQ.
- The liability book also did well with deposits growing at around 6% QoQ and 35% YoY to reach INR 58,000cr.
Alteogen (196170 KS): First Proprietary Product Approval in Korea To Improve Revenue Visibility
- Alteogen Inc (196170 KS)‘s first proprietary recombinant human hyaluronidase liquid product, Tergase (ALT-BB4) is currently under approval process in Korea and is expected to receive approval in early 2024.
- Tergase is a stand-alone hyaluronidase product that can be used for the treatment of various medical conditions, such as pain relief, edema treatment, and hyaluronic acid filler removal.
- Compared to commercially available animal-derived hyaluronidase products in the market, Tergase is a highly purified product of high-quality with very few impurities and an excellent side effect profile.
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