Equity Bottom-Up: Astra International, Taste Gourmet Group, Arwana Citramulia, Bank Negara Indonesia Persero, Shimano Inc, Oriental Land, HKEX, Z Holdings, AKR Corporindo, Meta Platforms (Facebook) and more

• Astra International 1Q2022 numbers reflect its prime positioning as a beneficiary of recovering domestic growth in Indonesia and its exposure to the commodities boom through United Tractors (UNTR IJ).
• It has increased market share in autos through Toyota and Daihatsu plus holds a strong position in providing auto, motorcycle, and heavy equipment financing providing further geared exposure. 
• Astra International has a war chest from the sale of Bank Permata which is yet to be deployed but could be in the digital space as a future potential catalyst.

For our next Corporate Webinar, we are glad to welcome Taste Gourmet Group (8371 HK) CFO and Company Secretary, Gerald Yu. In the upcoming webinar, Gerald will share a short company presentation with on-the-ground insights from Hong Kong, after which he will engage in a fireside chat with Smartkarma Analyst Sameer Taneja. A live Q&A session will follow.

The Corporate Webinar will be hosted on Tuesday, 17 May 2022, 17:00 SGT.

Taste Gourmet Group Limited is a Hong Kong-based restaurant group offering a variety of cuisines, under a portfolio of brands, to a diversified customer base. Since the opening of its first restaurant in 2007, the group has owned and operated a total of 34 restaurants offering Vietnamese, Japanese, Chinese, Western, and Drink under 14 brands, including 11 self-owned brands such as La’taste Vietnamese Cuisine, Dab-Pa Peking & Szechuan Cuisine, Dab-Pa Peking & Szechuan Bistro, Dab-pa Modern Chinese Cuisine, Urawa Japanese Restaurant, Nabe Urawa, Rakuraku Ramen, Wasyohuya Yamaichi, Moments Together, Yakiniku Guu, San-Kinn, three licensed brands known as Parkview, Takano Ramen, and Tirpse, and one joint venture brand known as Xianghui.

Corporate Webinars by Smartkarma Corporate Solutions feature discussions with IROs and Executives, discussing their companies, the challenges they face, and the opportunities in their sectors and markets.

• Arwana Citramulia (ARNA IJ) released a strong set of 1Q2022 surpassing expectations and paving the way for strong growth in 2022 driven by an improving product mix.
• ASPs for Arwana are increasing through changing product mix, which is improving margins but not suppressing demand with a move to higher-end Digi Uno and ARNA products. 
• A webinar with management confirmed the positive outlook for 2022, with an estimate of +30% bottom-line growth forecast from increased volumes, greater efficiencies, and higher ASPs through improved product mix.

• Bank Negara Indonesia (BBNI IJ) released a solid set of 1Q2022 results, with new loan bookings improving to pre-pandemic levels, strong non-interest income, and improving credit costs.
• The bank continues to pursue a multi-pronged digital strategy, with strong growth in mobile banking which now surpasses ATMs on transactions plus the launch of Bank Mayora digital bank.
• Bank Negara Indonesia (BBNI IJ) has already seen some upward re-rating since the last results but this can continue as its digital strategy bites and loan growth and NIMs improve.

• Channel checks with Merida Industry (9914 TT) and Giant Manufacturing (9921 TT) on the Asia order book provide color on Shimano’s results so far. 
• Channel checks with the Dutch Accell Group (ACCEL NA) also do not show any encouraging data either. 
• Share buyback will provide short term relief but it won’t make revenue growth rate to be as high as early 2021. 

• Oriental Land (4661 JP) fell more than 10% today after a strong earnings beat in 4QFY22, which saw revenue and OP beat consensus by ¥7.0bn and ¥8.6bn respectively.
• The medium-term outlook is very disappointing with the company expecting no pricing growth and low park attendance.
• After moving up nonsensically during COVID due to extremely inflated medium-term consensus, we think Oriental Land’s share price could start falling apart after this medium-term plan announcement.

• HKEX (388 HK) core businesses such as cash market and stock connect remain robust against the backdrop of relatively low expectation.
• Mark-To-Market investment loss underscored the volatile fixed income market, we expect the negative impact will continue into 2Q22 as the shift in rate environment.
• MSCI China A50 future continues its rapid ramp-up, ADV is up 86% quarter-over-quarter. Overall future trading is strong, ADV is up 39% quarter-over-quarter.

• FY22 EBITDA guidance is disappointing as strategic investments accelerate yet again and leaving investors uncertain on whether previous guidance for FY23 can be met
• We think ZHD’s FY23 target of ¥ 390bn in EBITDA is reachable but a meaningful beat, which is factored into consensus, is less likely
• So FY22 is another transition year but without the excitement on the potential for LINE as an alternative theme. It is better to be on the sidelines. 

• AKR Corporindo (AKRA IJ) results continued to reflect its key exposure to both economic recovery in Indonesia and its exposure to rising commodity prices through its chemical distribution.
• Volume growth in petroleum distribution may surprise on the upside, whilst chemical prices remain elevated boosting that business.
• The pipeline for its JIIPE industrial estate looks promising and management remains confident in targeting 40 ha land sales with potential upside from Freeport Smelter related demand. 

• Solid earnings call heightened our conviction in Facebook as a terrific long for the next year.
• Reels monetization headwind will become a tailwind… just a question of when. TikTok threat is real, but Facebook knows how to clone other’s innovations.
• Apple IDFA issues not worsening, Facebook will figure this out eventually.