In today’s briefing:
- Sony – Uncharted and Horizon Forbidden West Start Well
- BFI Finance Indonesia (BFIN IJ) – Catching a Digital Wave with GoTo?
- ASMP (522.HK): 4Q21 Results/ 1Q22 Outlook- It’s a Record Q1 at the Mid-Point of Guidance.
- Rakuten: At a New Forward EV/EBITDA Bottom
- India Household Appliances | Q3 Earnings Review and Channel Check Map
- Welcia’s Purchase of Kokumin: Watch Out Matsukiyo Cocokara
- Familymart, the Lifestyle Store
- Toyota – Quick Wage Negotiation Agreement Means Something
- Oversea Chinese Banking Corp.- Another Weak Print
- Oversea Chinese Banking Corp.- Another Weak Print
Sony – Uncharted and Horizon Forbidden West Start Well
- Sony had a busy 18th Feb as both the Uncharted movie and Horizon Forbidden West launched.
- Uncharted has done reasonably well though not to the extent we believed likely while the Horizon franchise could be on the way to truly elite status.
- We look for both releases to contribute to a strong 4Q along with Gran Turismo 7.
BFI Finance Indonesia (BFIN IJ) – Catching a Digital Wave with GoTo?
- BFI Finance Indonesia (BFIN IJ) released an impressive set of FY2021 results, as new financing picked up significantly and funding and credit costs declined in 4Q2021.
- Management is optimistic on the outlook for new financing in 2022 plus the potential for significant tailwinds from the association with GoTo plus inorganic growth opportunities.
- BFI Finance Indonesia trades on 2.2x FY22E PBV with a forecast ROE of 16.2%, above its 5-year average PBV but it deserves a re-rating given its association with GoTo.
ASMP (522.HK): 4Q21 Results/ 1Q22 Outlook- It’s a Record Q1 at the Mid-Point of Guidance.
- The 4Q21 revenue is HK$6.2bn (US$796.3mn), a 43.9% increase YoY. GM 41.3% is a 1,051bps increase YoY.
- Some memory market customers, like Samsung and Hynix, are adopting ASMP’s mainstream wire bond and advanced packaging tools for high volume manufacturing requirements.
- Full year 2021 dividend per share of HK$3.90, a 44.4% YoY increase.
Rakuten: At a New Forward EV/EBITDA Bottom
- Rakuten Inc (4755 JP) is currently trading 20% below the bottom end of the long term trend channel.
- With consensus FY+2 EBITDA at ¥309.8bn, Rakuten’s current EV/EBITDA is at an all-time low of 1.7x compared to the historical median and peak of 9.0x and 16.1x respectively.
- Based on the consensus FY+2 EBITDA and EV trend, we feel the fair valuation of Rakuten could be somewhere around ¥3,000bn EV.
India Household Appliances | Q3 Earnings Review and Channel Check Map
- We analyze Q3 FY22 Earnings for Bajaj Electricals (BJE IN) , Crompton Greaves Consumer Electricals (CROMPTON IN) , Havells India (HAVL IN) and Stove Kraft (0490943D IN)
- Stress in rural is hurting BJE, CROMPTON is riding high on new products, Upcoming AC season is the key for HAVL. For Stove Kraft growth is falling off a cliff.
- BJE and HAVL would be best placed to explore a potentially long and short respectively.
Welcia’s Purchase of Kokumin: Watch Out Matsukiyo Cocokara
- Last month, Welcia announced the acquisition of Kokumin, the 30th ranked drugstore that runs a well-respected chain stretching across the country.
- As the newly formed Matsukiyo Cocokara group continues to struggle, another year of high growth means Welcia will be only just behind when FY2021 results come in.
- Overall growth in the drugstore sector remains strong and could even overtake convenience stores in the near future.
Familymart, the Lifestyle Store
- Thanks to the huge supply chain capabilities of its parent Itochu Corp (8001 JP), FamilyMart Co Ltd (8028 JP) is moving into new categories of private label product.
- These are not the traditional staples of the convenience store but new types of more fashionable lifestyle products in clothing and cosmetics.
- Recent results show successful collaboration with Noin for cosmetics and with Hiromichi Ochiai from Facetasm for clothing basics, selling more than 1 million items each.
Toyota – Quick Wage Negotiation Agreement Means Something
- The Nikkei reported today that Toyota had already agreed to accept its unions wage hike demands and in full.
- This is unusual given typically fair but tough negotiations and Toyota’s penchant for very strict cost control.
- Although the news does not appear to be attracting any great attention we believe it is actually quite significant.
Oversea Chinese Banking Corp.- Another Weak Print
- OCBC reported 4Q21 net profit of SGD 973 mn, declining 20.5% linked quarter, as a result of an increase in loss provisions and higher costs;
- Were it not for the 51.8% decline in Singapore NPLs, credit quality would have been disastrous for OCBC with credit falling off of a cliff regionally; and
- Given the increase in net new NPLs, reserves would appear to now be wanting by SGD 2.8 bn plus or nearly three quarters of bottom-line results.
Oversea Chinese Banking Corp.- Another Weak Print
- OCBC reported 4Q21 net profit of SGD 973 mn, declining 20.5% linked quarter, as a result of an increase in loss provisions and higher costs;
- Were it not for the 51.8% decline in Singapore NPLs, credit quality would have been disastrous for OCBC with credit falling off of a cliff regionally; and
- Given the increase in net new NPLs, reserves would appear to now be wanting by SGD 2.8 bn plus or nearly three quarters of bottom-line results.
Related tickers: Sony Corp (6758.T), BFI Finance Indonesia (BFIN.JK), ASM Pacific Technology (0522.HK), Rakuten Inc (4755.T), Bajaj Electricals (BJEL.NS), Welcia Holdings (3141.T), FamilyMart Co Ltd (8028.T), Toyota Motor (7203.T), OCBC (OCBC.SI), OCBC (OCBC.SI)
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