Asia Consumer Research, Investory

Devi Subhakesan

Asia Consumer Sector Focus. Fundamental Research.

Experience: Equity research analyst with Buy and Sell-side Institutions. ASEAN, India & North Asia Markets. Consumer Discretionary, Media, Textiles, Oil, Gas & Coal sectors. 
Mindfulness and Meditation Enthusiast.

Asia Consumer Research

Miniso (MNSO US): Impulse Shopper's Paradise. Not a Sustainable Growth Model.

ASIA CONSUMER: INSIGHTS AND INVESTMENT IDEAS

Investory

Investory is a Singapore-based boutique independent equity research firm founded in January 2017 with a primary focus on consumption themes across Asia-Pacific.

We aim to generate investible ideas based on consumption trends and outlook. We screen our ideas on several parameters - product potential, long-term growth and management commitment being the most critical.  We follow a fundamental analysis approach in our stock selection process and are not restricted by market cap.

We aspire to grow into a leading source of unbiased research, free of conflict of interest, for investors yearning for independent and disciplined analysis. 

We also undertake bespoke research mandates to support our Institutional clients’ investment needs.

Our team comprises of professionals with extensive experience in the Asian equity markets, in areas ranging from research, servicing institutional clients and investment management.

Equity Bottom-Up

<p>In this note, we reiterate why investors with a focus on fundamentals should avoid <a href="https://www.smartkarma.com/entities/miniso-group-holdings" target="_blank" data-smartkarma-citation="entities:29673:1" rel="noopener">MINISO Group Holdings (MNSO US)</a>. Miniso's business model lacks the competitive edge or a long term sustainable growth potential to justify its stock valuations. The stock is currently trading marginally above its October 15th listing price of US$20. It's cheaply sourced, cute looking, low-value variety discretionary products has neither a strong customer base nor a clear brand identity. We highlight that offline-based discount retailers of discretionary products, like Miniso, that were upended by the pandemic but has limited prospects to pivot online, are not COVID-recovery plays. Expect sales to slow down versus pre-COVID levels, both in terms of same-store sales and store network expansion. </p><p>In our earlier report <a href="https://www.smartkarma.com/insights/miniso-mnso-us-impulse-shopper-s-paradise-not-a-sustainable-growth-model" target="_blank" data-smartkarma-citation="insights:44050" rel="noopener">Miniso (MNSO US): Impulse Shopper's Paradise. Not a Sustainable Growth Model.</a> we discussed why we find Miniso's business model not appealing and how it lacked a competitive advantage. Unsurprisingly, competitors with very similar products and sales strategies are already in the market.</p>

In this note, we reiterate why investors with a focus on fundamentals should avoid MINISO Group Holdings (MNSO US). Miniso's business model lacks the competitive edge or a long term sustainable growth potential to justify its stock valuations. The stock is currently trading marginally above its October 15th listing price of US$20. It's cheaply sourced, cute looking, low-value variety discretionary products has neither a strong customer base nor a clear brand identity. We highlight that offline-based discount retailers of discretionary products, like Miniso, that were upended by the pandemic but has limited prospects to pivot online, are not COVID-recovery plays. Expect sales to slow down versus pre-COVID levels, both in terms of same-store sales and store network expansion. In our earlier report Miniso (MNSO US): Impulse Shopper's Paradise. Not a Sustainable Growth Model. we discussed why we find Miniso's business model not appealing and how it lacked a competitive advantage. Unsurprisingly, competitors with very similar products and sales strategies are already in the market.

Miniso (MNSO US): Cute and Cheap Is Not a Competitive Edge. Not for LT Keep.