Global Senior Analyst, Fundamental Equity Research

Emile Farsoun

Equity Bottom-Up

<p><a href="https://www.smartkarma.com/entities/minth-group-ltd" target="_blank" data-smartkarma-citation="entities:9232:1" rel="noopener">Minth Group Ltd (425 HK)</a> is a Chinese Auto supplier with secular growth prospects as it continues to gain greater share in the global supply chain from the current c.10%, driven by its niche position in aluminium interior and exterior products.</p><p>The stock is trading at 2020 P/E of 13.3x and 2020 EV/EBITDA of 8.1x. In our view, this is cheap for a mid teens EPS grower, despite the apparent cyclical nature of the business. For long term investors, the 3-year IRR is attractive at 18%, assuming an exit P/E multiple  of 15x.</p>

Minth Group Ltd (425 HK) is a Chinese Auto supplier with secular growth prospects as it continues to gain greater share in the global supply chain from the current c.10%, driven by its niche position in aluminium interior and exterior products.The stock is trading at 2020 P/E of 13.3x and 2020 EV/EBITDA of 8.1x. In our view, this is cheap for a mid teens EPS grower, despite the apparent cyclical nature of the business. For long term investors, the 3-year IRR is attractive at 18%, assuming an exit P/E multiple  of 15x.

Minth (425 HK): A Cyclical with Structural Growth