Analyst

Steve Zhou, CFA

15 years of experience in both buy and sell-side in Asia.

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/eclat-textile-company-ltd" target="_blank" data-smartkarma-citation="entities:13209:1" rel="noopener">Eclat Textile Company (1476 TT)</a> is a vertically integrated textile company, with around 20% net profit margin, similar to <a href="https://www.smartkarma.com/entities/shenzhou-intl-group-holdings-ltd" target="_blank" data-smartkarma-citation="entities:10415:1" rel="noopener">Shenzhou Intl Group Holdings (2313 HK)</a>. </li>
<li>The company just reported 3Q23 results, with sales down 26% yoy and net profit down 28% yoy.  Starting the next quarter 4Q23, the company is expected to return to growth.</li>
<li>The company now trades at 23x 2024E earnings.  I believe the valuation is reasonable as growth returns, and there are potential upside catalysts. </li>
</ul>



Eclat Textile Company (1476 TT) is a vertically integrated textile company, with around 20% net profit margin, similar to Shenzhou Intl Group Holdings (2313 HK). 
The company just reported 3Q23 results, with sales down 26% yoy and net profit down 28% yoy.  Starting the next quarter 4Q23, the company is expected to return to growth.
The company now trades at 23x 2024E earnings.  I believe the valuation is reasonable as growth returns, and there are potential upside catalysts. 


Eclat Textile (1476 TT):  Start Of Upcycle