In today’s briefing:
- Palantir – Little Early But Getting Interesting Again
- JD Logistics (2618 HK): Shrinking Operating Loss in 2H21 and Exclusive Revenue Support
- Tencent Music Entertainment: A Fallen Star for High Risk Investors that Could Promise Huge Returns
- Jubilant Foodworks (JUBI IN) | Anyone Can Hold the Helm when the Sea Is CALM
- Workman to Open in Ginza, Launches Workman Shoes and More Suits
- Topchoice Medical (600763.CH) – The Logic Changes
- COM7: Dilution Effect Have Significant Impact to 22E EPS Growth
- Paradigm Biopharmaceuticals (PAR AU): Concerns Persist Amid Deteriorating Financials
- KTB: Growth Normalization Is Underway
Palantir – Little Early But Getting Interesting Again
- We last wrote on Palantir over a year ago when we suggested stepping away given expiring lock-ups.
- The stock is down 58% since that call as it has sold off together with other unprofitable, high-growth names.
- However, we remain of the view that there is something to Palantir unlike many of its compatriots and Ark is now out…
JD Logistics (2618 HK): Shrinking Operating Loss in 2H21 and Exclusive Revenue Support
- JD.com (JD)’s revenue growth is a strong support for JD Logistics’ revenue.
- JDL successfully acquired corporate clients and expanded warehouse network in 2021.
- We believe the stock has an upside of 40% and a target price of HK$27.
Tencent Music Entertainment: A Fallen Star for High Risk Investors that Could Promise Huge Returns
- The US traded unit of China’s Tencent entry into digital music has lost exclusive rights to its foundational music and entertainment content due to Beijing policies.
- Stock price has been in free fall from a $31 high last March to $3.44.
- The historic term “fallen angel: applies to bonds but TME ‘s current trade suggests it could well apply to special situations in common.
Jubilant Foodworks (JUBI IN) | Anyone Can Hold the Helm when the Sea Is CALM
- Jubilant Foodworks (JUBI IN) announced the departure of its CEO Mr Pratik Pota.
- The timing of departure coupled with recent disappointment around disclosures is making the market nervous.
- As the “sea” gets stormy thanks to high food inflation and pressured “Dine-Ins”, who would be JUBI’s new captain is the key.
Workman to Open in Ginza, Launches Workman Shoes and More Suits
- Workman has consolidated its position as a leading domestic outdoor/sports casual retailer in the last two years.
- Growth has been less dramatic but it has developed more infrastructure and brand foundations for what it hopes will be the next big expansion.
- It is expanding the number of banners, increasing the ratio of private label and widening the number of categories it sells, including footwear and camping.
Topchoice Medical (600763.CH) – The Logic Changes
- Policy risk is the biggest uncertainty for domestic medical service sector, without any overseas revenue to “hedge” such risk.
- The market places great hope on Topchoice to become a cross-regional enterprise with high growth sustainability. Without a reliable and replicable expansion model, the high valuation is not logical.
- Therefore, our view is that the Company’s investment logic has been shaken. Topchoice Medical (600763 CH) could be a short-term trade, but not long-term hold.
COM7: Dilution Effect Have Significant Impact to 22E EPS Growth
- We downgrade to HOLD rating with a new TP of Bt38.75 derived from 28.9xPE’22E (-0.5SD of 5-Yr trading average)to factor in negative impact from stock dividend on 22E EPS growth
- COM7 announced annual cash dividend of Bt1.00 and stock dividend (Bt0.25), XD date on 11 Mar.
- We believe the dilution effect will have a negative impact on the company’s shareholders.Recurring EPS growth should drop to-38.4%YoYin 22E,down from 23.2%YoYpre-dilution,while dividend yield will also be halved to 1.2%.
Paradigm Biopharmaceuticals (PAR AU): Concerns Persist Amid Deteriorating Financials
- Paradigm Biopharmaceuticals (PAR AU) shares plunged 32% since we published our bearish insight on the company on January 11. Shares are trading near their pandemic lows.
- Our negative view on the company due to the inherent safety proposition of lead drug and financial uncertainty remain intact. Insider buying led to the recent uptick in share prices.
- Amid uncertain global market condition and general market apathy toward biotechnology companies, we will not be an investor of Paradigm Biopharmaceuticals despite its recent sell-down.
KTB: Growth Normalization Is Underway
- Maintain HOLD with a target price of Bt15.00. Our HOLD call reflects KTB’s slowing growth ahead and limited upside gain. Yet, a dividend yield of 4.5-4.8% for 2022-23 remains attractive.
- Management guided loan growth to moderate to 3-4% YoY in 2022. Asset quality remains manageable.
- Government expenditure will bolster Thailand’s economy in 2022. But growth potential may weaken than expected on potential impacts from higher energy prices and geopolitical uncertainties.
Related tickers: Tencent Music (TME.N), Jubilant Foodworks (JUBI.NS), Workman Co Ltd (7564.T), Topchoice Medical (600763.SS), Paradigm Biopharmaceuticals (PAR.AX), Krung Thai Bank Pub (KTB.BK)
Before it’s here, it’s on Smartkarma
