In today’s briefing:
- Why Evergrande’s Bankruptcy Filing Is a Positive Development
- [Atour (ATAT US, BUY, TP US$36.5) TP Change]: Demand Supply Imbalance to Sustain…maintain BUY
- Jana Small Finance Bank Pre-IPO Tearsheet
Why Evergrande’s Bankruptcy Filing Is a Positive Development
- Evergrande’s filing in itself does not signify a deterioration in its financials; it was already insolvent as of end 2021.
- The bankruptcy filing provides the benefits of automatic stay and is a necessary step to validate the Group’s offshore restructuring plan.
- Evergrande’s long term viability still depends on recovery of the China property market.
[Atour (ATAT US, BUY, TP US$36.5) TP Change]: Demand Supply Imbalance to Sustain…maintain BUY
- Atour reported 2Q23 revenue 9.5%/11.7% higher than our estimate/ consensus, which leads to non-GAAP NI 15.1%/21.1% higher than our estimate/ consensus respectively. Both retail and hotel business have positive contribution.
- We think the strong sales momentum in 2Q23 hotel business is likely to continue in 3Q23 due to the strong summer season but gradually eased in 4Q23.
- We maintain the stock as BUY rating, and raise TP by US$1.5 to US$36.5 to factor in the better operating efficiency in retail business.
Jana Small Finance Bank Pre-IPO Tearsheet
- Jana Small Finance Bank (3667144Z IN) is looking to raise up to US$100m in its upcoming India IPO. The deal will be run by Axis Capital, ICICI-Sec and SBI Capital.
- Jana Small Finance Bank (JSFB) is the fourth largest small finance bank in India in terms of AUM and deposit size as of FY23 (Year ended 31st Mar 2023).
- The firm has served nearly 12m customers since 2008, including 4.57m active customers as of FY23.
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