In today’s briefing:
- [Tencent Music (TME US, SELL, TP US$6) Preview]: Competition Is Still a Concern, Maintain SELL
- Neuren Pharmaceuticals (NEU AU): Shares Roar on Expanded Global Partnership for Newly Launched Drug
- Korean Holdcos Vs Opcos Gap Trading Opportunities in 3Q 2023
- Siloam International Hospitals (SILO IJ) – Harnessing Outward Tourism with Greater Complexity
- Bangkok Chain Hospital (BCH TB): High COVID-Related Base Effect Impacted 1Q23 Result
- Bloomberry Is Best Pure Play on Philippine Gaming Growth Cycle
- [Atour Lifestyle (ATAT US, BUY, TP US$35) Preview]: Retail and Summer Travelling Are Two Catalysts
- Kinatico Ltd – Maiden FY23 Profit of $0.2m, Ahead of Forecast
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[Tencent Music (TME US, SELL, TP US$6) Preview]: Competition Is Still a Concern, Maintain SELL
- We expect the 2Q23 online music revenue growth to be 34.4% YoY, driven by more promotions to drive up users’ retentions;
- We anticipate the 2Q23 social entertainment growth rate to be (12.9%) YoY, due to intense competition and strengthened regulatory in live streaming.
- We expect TME’s 2Q23’s rev./non-GAAP net income to be (1.8%)/ (3.9%) vs cons. We maintain SELL because of continuous pressure from Bytedance’s Soda Music, Wechat Video Account and Kuaishou.
Neuren Pharmaceuticals (NEU AU): Shares Roar on Expanded Global Partnership for Newly Launched Drug
- Neuren Pharmaceuticals (NEU AU) announced the expansion of partnership with Acadia Pharmaceuticals for trofinetide. Acadia’s exclusive license for trofinetide in North America has been expanded to a worldwide exclusive license.
- Neuren is now entitled for additional payments and will receive $100M up-front, plus additional potential milestone payments of upto $427M and royalties on net sales of trofinetide outside North America.
- Neuren has also granted Acadia an exclusive worldwide license to develop and commercialize NNZ-2591 for Rett and Fragile X syndromes and retains worldwide rights to NNZ-2591 in all other indications.
Korean Holdcos Vs Opcos Gap Trading Opportunities in 3Q 2023
- In this insight, we highlight the pricing gap divergences of the major Korean holdcos and opcos in 3Q 2023.
- Of the 38 pair trades, 22 of them involved holdcos outperforming opcos YTD and 16 of them involved opcos outperforming holdcos in the same period.
- We highlight 38 pair trades that involve Korean holdcos and opcos.
Siloam International Hospitals (SILO IJ) – Harnessing Outward Tourism with Greater Complexity
- The recent announcement that Indonesia will allow foreign doctors to operate in Indonesia should benefit listed healthcare players with Siloam International Hospitals being a key beneficiary of the move.
- The company has come out of the pandemic stronger and more profitable with an ongoing focus on increasing the complexity of treatments and the efficiency of operations.
- Siloam International Hospitals will continue to open 1-2 new hospitals each year but it only utilises 3,000 out of 7,000 bed capacity leaving room for organic growth. Valuations are attractive.
Bangkok Chain Hospital (BCH TB): High COVID-Related Base Effect Impacted 1Q23 Result
- In 1Q23, Bangkok Chain Hospital (BCH TB) recorded 62% YoY decline in revenue from hospital operation, dragged by 39% YoY decline in revenue from general patients (66% of total revenue).
- COVID-19 revenue contributed 48% of revenue in 1Q22, thereby creating a high base for 1Q23. Even if we exclude COVID-19 revenue received in 1Q22, 1Q23 revenue was down 28% YoY.
- BCH will need time to recover and record growth. Consensus expects BCH to report revenue and EPS decline of 34% and 47%, YoY, respectively in 2023.
Bloomberry Is Best Pure Play on Philippine Gaming Growth Cycle
- A combination of strong property values, sound balance sheet and expansion to second Philippine property will produce strong result in sequential quarters ahead.
- Macro factors in market blur expectations for investor interest at this point in other major players in the Entertainment Zone space.
- Regulators predict Philippine GGR wil reach US$10b by 2027, making it among the globe’s most attractive gaming investment targets.
[Atour Lifestyle (ATAT US, BUY, TP US$35) Preview]: Retail and Summer Travelling Are Two Catalysts
- We expect Atour to report 2Q23 revenue and non-GAAP NI at 94% YoY and 259% YoY, which is 22% and 20% above BBG consensus respectively.
- We expect Atour’s RevPAR in 3Q23/2023 increase to 110%/114% of corresponding 2019 level from previous estimate at 105%/112%.
- We maintain the stock as BUY rating, and maintain TP at US$35 because the operational gains has been mitigated by FX loss in terms of valuation
Kinatico Ltd – Maiden FY23 Profit of $0.2m, Ahead of Forecast
- Kinatico Ltd (ASX:KYP) is a ‘Know Your People” regtech company providing workforce compliance monitoring and management technology and services.
- KYP has announced in a flash update that it expects to report FY23 NPAT greater than $0.2m, marking its first profitable full year since listing.
- This is ahead of our FY23 NPAT forecast of $0.14m.