In today’s briefing:
- Keepers Holdings: Cheap Consumption Multibagger in the Philippines
- Asian Paints (APNT IN) | Q3 | Leveraging Leadership Position
- Bajaj Finance: Gearing Up To Become India’s Dominant Fintech
- Austar Lifesciences (6118 HK): It’s Risky to Catch the Falling Knife
Keepers Holdings: Cheap Consumption Multibagger in the Philippines
- The Keepers Holdings, Inc. (KEEPR PM) is a play on the imported liquor distribution business in the Philippines, with a >74% marketshare conservatively growing at 12-15% CAGR.
- Trading at 11.5x/10.0x FY21/22 PE with 35% of the market capitalization in cash ( implying an ex-cash PE of 7.5x), the stock is cheap with a significant margin of safety.
- Value enhancing asset injection angle with potential for the chairman Lucio Co to inject his Bodegas William and Humbers (W&H) stake into the listco.
Asian Paints (APNT IN) | Q3 | Leveraging Leadership Position
- Strong volume growth in Tier 1/2 locations aided revenue surprise, while RM inflation hurt profitability in Q3.
- Impact of price hikes and demand revival in Tier 3/4 locations could be the possible catalysts to monitor going into Q4
- Valuations apart, Asian Paints (APNT IN) market share gaining ability, strategic positioning and possibility of revenue surprise suggest the trade is best BULLISH and not BEARISH on APNT.
Bajaj Finance: Gearing Up To Become India’s Dominant Fintech
- Bajaj Finance Ltd (BAF IN) reported record quarterly profit of INR 2,125cr on the back of strong growth in AUM and improving asset quality.
- BAF has launched its Phase 1 digital transformation. This quarter, it shared detailed updates around it. It is now working on year-long step-wise Phase 2 launch.
- With liquidity buffer normalizing, asset quality improving, and customer acquisition accelerating led by digital initiatives, we believe BAF is at an interesting inflection point.
Austar Lifesciences (6118 HK): It’s Risky to Catch the Falling Knife
- Management is not aware of any significant reason for the recent unusual price movement in Austar Lifesciences (6118 HK) shares.
- The company’s strong financial performance in H1 2021 and order book seems to be mostly driven by the COVID-19 vaccine-related demand, which is expected to fade off this year.
- Divestment of its 60% equity interest in Pall-Austar Lifesciences is expected to weaken its competitive positioning in the lifescience tool market in China.
Related tickers: Asian Paints (ASPN.NS), Bajaj Finance Ltd (BAF.NS), Austar Lifesciences (6118.HK)
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