In today’s briefing:
- ZTO Express Q3: Margins Plunge Vs Q2 | Abandons Pursuit of Share Gains | Is There a New Strategy?
- OpenAI Boardroom Battle: Safety First
- Sa Sa Intl (178 HK): Many Bright Spots in 1HFY24 Result
- Keepers Holdings Concall Highlights: Soft Q3 2023, Build Up to Seasonally High Q4
ZTO Express Q3: Margins Plunge Vs Q2 | Abandons Pursuit of Share Gains | Is There a New Strategy?
- Non-Core items boosted Q3 earnings, but core margins plunged vs Q2
- In a surprise move, ZTO has abandoned its aggressive pursuit of share
- Medium term growth is likely to slow, and pressure on margins remains
OpenAI Boardroom Battle: Safety First
- OpenAI was founded in 2015 by investors, including Elon Musk, Reid Hoffman, Peter Thiel, AWS, and YC Research.
- The goal was to pursue Artificial General Intelligence (AGI) safely for the benefit of humanity.
- There was an initial pledge of $1 billion, but the money that came in was $100 million from Elon Musk and $30 million from Open Philanthropy.
Sa Sa Intl (178 HK): Many Bright Spots in 1HFY24 Result
- Besides turnaround in the bottom line, Sa Sa International (178 HK) achieved good store efficiency improvement and enviable cost control. It will enjoy further operating leverage.
- The 5.3pp sequential increase in sales contribution from tourists highlights its position to benefit from revival of tourist arrivals. Three to-be-opened stores will boost sales momentum.
- Initial sales figures for 3QFY24 point to 27% overall sales growth, which is encouraging. Sa Sa stays in a very solid financial position with HK$196m of net cash.
Keepers Holdings Concall Highlights: Soft Q3 2023, Build Up to Seasonally High Q4
- The Keepers Holdings (KEEPR PM) reported a soft Q3 2023 with revenue up 6.7% YoY and profits 4.5% YoY (ex-one offs of 38 mn pesos profits up 11% YoY).
- The company guided a good build-up into Q4 2023 as the festive season showed signs of a good pick-up.
- Trading at 8.2x/7x FY23e/24e with a 5.4%/6.3% dividend yield, we like the name, although there are a few short-term risks on working capital that the company needs to address.
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