Research from Asian Century Stocks, Asian Century Stocks

Michael Fritzell

Research from Asian Century Stocks

Providing financial journalism in the Asia-Pacific

Asian Century Stocks

Asian Century Stocks is a newsletter providing financial journalism for companies and stocks in the Asia-Pacific. 
The Asian Century Stocks logotype “百” stands for “one hundred” or a “century”. The economic centre of gravity is moving towards Asia. Yet most global investors are missing out.

Equity Bottom-Up

Hongkong & Shanghai Hotels / Equity Bottom-Up

<ul>
<li>Great portfolio of assets, most notably 10 hotels under the Peninsula brand name</li>
<li>Capex has been excessive over the past 10 years, especially in London, but the company is now focused on execution and paying back debt. Both London and Istanbul ramping up.</li>
<li>NAV per share of HK$24 per share, putting at the HK$6.2 price at a 74% discount to NAV. Key is whether Philip Kadoorie will unlock value once he takes over.</li>
</ul>


Great portfolio of assets, most notably 10 hotels under the Peninsula brand name
Capex has been excessive over the past 10 years, especially in London, but the company is now focused on execution and paying back debt. Both London and Istanbul ramping up.
NAV per share of HK$24 per share, putting at the HK$6.2 price at a 74% discount to NAV. Key is whether Philip Kadoorie will unlock value once he takes over.


Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Mandarin Oriental International / Equity Bottom-Up

<ul>
<li>Hong Kong is - very gradually - rolling back Covid restrictions</li>
<li>That's a welcome relief for tourists, and for hospitality companies dependent on tourism. </li>
<li>
<a href="https://www.smartkarma.com/entities/mandarin-oriental-international-ltd" target="_blank" data-smartkarma-citation="entities:4773:1" rel="noopener">Mandarin Oriental International (MAND SP)</a> is trading cheap at 0.7x P/B against 1.8x on average (five years) pre-Covid.</li>
</ul>


Hong Kong is - very gradually - rolling back Covid restrictions
That's a welcome relief for tourists, and for hospitality companies dependent on tourism. 

Mandarin Oriental International (MAND SP) is trading cheap at 0.7x P/B against 1.8x on average (five years) pre-Covid.


Mandarin Oriental (MAND SP): Life Is Suite

HK/China Equity Long-Short

Osbert Tang, CFA

<ul>
<li>Given significant presence in China, <a href="https://www.smartkarma.com/entities/shangri-la-asia-ltd" target="_blank" data-smartkarma-citation="entities:19690:1" rel="noopener">Shangri-La Asia (69 HK)</a> is geared towards China's more accommodative COVID policy. The good thing is that the share price has not yet reflected this. </li>
<li>Over the next 12-18 months, SLA will first benefit from tourism recovery outside of China, and then followed by powerful rebound in China's inbound travelers, particularly the high-end business visitors.</li>
<li>The resurgence in long-absented business visitors should bring in higher room yield and F&amp;B revenue. It has minimal refinancing and liquidity risks and these make its near-trough 0/48x P/B unjustified. </li>
</ul>


Given significant presence in China, Shangri-La Asia (69 HK) is geared towards China's more accommodative COVID policy. The good thing is that the share price has not yet reflected this. 
Over the next 12-18 months, SLA will first benefit from tourism recovery outside of China, and then followed by powerful rebound in China's inbound travelers, particularly the high-end business visitors.
The resurgence in long-absented business visitors should bring in higher room yield and F&amp;B revenue. It has minimal refinancing and liquidity risks and these make its near-trough 0/48x P/B unjustified. 


Shangri-La Asia (69 HK): Let's Go, What Are You Waiting For?

Event-Driven

Hongkong & Shanghai Hotels / Event-Driven

<ul>
<li>The Kadoorie family, <a href="https://www.smartkarma.com/entities/hongkong-shanghai-hotels" target="_blank" data-smartkarma-citation="entities:5274:1" rel="noopener">Hongkong &amp; Shanghai Hotels (45 HK)</a>'s major shareholder, is paying HK$2.63bn to increase its holding to 72.43% from 59.98%.</li>
<li>The price under the SPA is $12.80/share, a 92.5% premium to the undisturbed price. Shares promptly gained 19.5% yesterday. No Offer was triggered. </li>
<li>What is conveniently left out of the announcement, and in media articles, is the original owner of these shares - <a href="https://www.smartkarma.com/entities/tai-united-holdings-ltd" target="_blank" data-smartkarma-citation="entities:7166:1" rel="noopener">Tai United Holdings (718 HK)</a>.</li>
</ul>


The Kadoorie family, Hongkong &amp; Shanghai Hotels (45 HK)'s major shareholder, is paying HK$2.63bn to increase its holding to 72.43% from 59.98%.
The price under the SPA is $12.80/share, a 92.5% premium to the undisturbed price. Shares promptly gained 19.5% yesterday. No Offer was triggered. 
What is conveniently left out of the announcement, and in media articles, is the original owner of these shares - Tai United Holdings (718 HK).


HK&S Hotels (45 HK): Kadoories Mop Up Someone Else's Mess

<ul>
<li>
<a href="https://www.smartkarma.com/entities/crown-resorts-ltd" target="_blank" data-smartkarma-citation="entities:808:1" rel="noopener">Crown Resorts (CWN AU)</a> backs Blackstone's revised Offer of A$13.10/share in cash, from A$12.50 previously, and up from A$11.85/share initially.  </li>
<li>The endgame approaches for the <a href="https://www.smartkarma.com/entities/bhp-group-ltd" target="_blank" data-smartkarma-citation="entities:147:1" rel="noopener">BHP (BHP AU)</a> Unification trade. S&amp;P announced the S&amp;P/ASX upweight would be one-shot, as expected. Regulatory approvals are in. SARB has set BHP SJ as "domestic."</li>
<li>The Offeror slashes the Offer price for <a href="https://www.smartkarma.com/entities/51-job-inc-adr" target="_blank" data-smartkarma-citation="entities:532:1" rel="noopener">51 Job (JOBS US)</a> by 27.6%, however, it's not clear how the new deal terms sidestep the regulator nor justify a reduction. </li>
</ul>



Crown Resorts (CWN AU) backs Blackstone's revised Offer of A$13.10/share in cash, from A$12.50 previously, and up from A$11.85/share initially.  
The endgame approaches for the BHP (BHP AU) Unification trade. S&amp;P announced the S&amp;P/ASX upweight would be one-shot, as expected. Regulatory approvals are in. SARB has set BHP SJ as "domestic."
The Offeror slashes the Offer price for 51 Job (JOBS US) by 27.6%, however, it's not clear how the new deal terms sidestep the regulator nor justify a reduction. 


Last Week in Event SPACE: BHP Group, Crown Resorts, 51job, Hitachi, Razer Inc

Hong Kong

The Hongkong and Shanghai Hotels, Limited, through its subsidiaries, operates and manages hotels, food, beverage outlets, and clubs. The Company also invests in properties.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Hongkong & Shanghai Hotels (45 HK)

The Hongkong & Shanghai Hotels (45 HK)

Article highlights Hongkong & Shanghai Hotel's valuable assets, including 10 Peninsula hotels, with focus on reducing debt and unlocking value...

Asian Century Stocks

Mandarin Oriental (MAND SP): Life Is Suite

Mandarin Oriental is trading cheap at 0.7x P/B against 1.8x on average (5 years) pre-Covid. Business will continue to improve from here. The...

David Blennerhassett

Shangri-La Asia (69 HK): Let's Go, What Are You Waiting For?

Shangri-La Asia has benefited from China's domestic tourism recovery, and we expect this will be followed by better tourist flow outside of China...

Osbert Tang, CFA

HK&S Hotels (45 HK): Kadoories Mop Up Someone Else's Mess

The Kadoorie family is paying HK$2.63bn to increase its holding to 72.43% from 59.98%. What is conveniently left out of the announcement, is the...

David Blennerhassett

Last Week in Event SPACE: BHP Group, Crown Resorts, 51job, Hitachi, Razer Inc

The weekend is here! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed...

David Blennerhassett

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

The Hongkong & Shanghai Hotels (45 HK)

​Article highlights Hongkong & Shanghai Hotel's valuable assets, including 10 Peninsula hotels, with focus on reducing debt and unlocking value...

Asian Century Stocks

Mandarin Oriental (MAND SP): Life Is Suite

Mandarin Oriental is trading cheap at 0.7x P/B against 1.8x on average (5 years) pre-Covid. Business will continue to improve from here. The...

David Blennerhassett

Shangri-La Asia (69 HK): Let's Go, What Are You Waiting For?

Shangri-La Asia has benefited from China's domestic tourism recovery, and we expect this will be followed by better tourist flow outside of China...

Osbert Tang, CFA

HK&S Hotels (45 HK): Kadoories Mop Up Someone Else's Mess

The Kadoorie family is paying HK$2.63bn to increase its holding to 72.43% from 59.98%. What is conveniently left out of the announcement, is the...

David Blennerhassett

Last Week in Event SPACE: BHP Group, Crown Resorts, 51job, Hitachi, Razer Inc

The weekend is here! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed...

David Blennerhassett

Article highlights Hongkong & Shanghai Hotel's valuable assets, including 10 Peninsula hotels, with focus on reducing debt and unlocking value...