Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>
Tax-Loss Selling's a subject of interest in Australia. Retail investors will take gains on stocks which run up in price, or get taken over, then look for losses to offset.</li>
<li>Investors are caught out as the Aussie government "approves" <a href="https://www.smartkarma.com/entities/hanwha-ocean-co-ltd" target="_blank" data-smartkarma-citation="entities:12531:1" rel="noopener">Hanwha Ocean (042660 KS)</a> buyng <a href="https://www.smartkarma.com/entities/austal-ltd" target="_blank" data-smartkarma-citation="entities:14420:1" rel="noopener">Austal Ltd (ASB AU)</a>. There is evidently a lot more going on in the background. </li>
<li>
<a href="https://www.smartkarma.com/entities/west-japan-railway-co" target="_blank" data-smartkarma-citation="entities:12077:1" rel="noopener">West Japan Railway Co (9021 JP)</a> announces a biggish buyback. One could buy dips, but one should probably not chase. For that, suggest this acts as a range trade.</li>
</ul>



Tax-Loss Selling's a subject of interest in Australia. Retail investors will take gains on stocks which run up in price, or get taken over, then look for losses to offset.
Investors are caught out as the Aussie government "approves" Hanwha Ocean (042660 KS) buyng Austal Ltd (ASB AU). There is evidently a lot more going on in the background. 

West Japan Railway Co (9021 JP) announces a biggish buyback. One could buy dips, but one should probably not chase. For that, suggest this acts as a range trade.


Last Week in Event SPACE: Aussie Tax-Loss Selling, Austal, West Japan Railway, PICC/PICC P&C

Melco International Development / Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/melco-international-development-ltd" target="_blank" data-smartkarma-citation="entities:809:1" rel="noopener">Melco International (200 HK)</a> gains as Lawrence Ho increases his position. Melco and 51.1%-held <a href="https://www.smartkarma.com/entities/melco-crown-entertainme-adr" target="_blank" data-smartkarma-citation="entities:810:1" rel="noopener">Melco Resorts (MLCO US)</a> are the two worst performing gaming stocks over the past year.</li>
<li>Preceding my comments on Melco are the current setup/unwind tables for Asia-Pacific Holdcos.</li>
<li>These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation &gt;20%.</li>
</ul>



Melco International (200 HK) gains as Lawrence Ho increases his position. Melco and 51.1%-held Melco Resorts (MLCO US) are the two worst performing gaming stocks over the past year.
Preceding my comments on Melco are the current setup/unwind tables for Asia-Pacific Holdcos.
These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation &gt;20%.


StubWorld: Melco Gains As Lawrence Ho Buys

Senior Credit Analyst, Lucror Analytics

Leonard Law, CFA

Senior Credit Analyst

High Yield Experts

Lucror Analytics

Lucror Analytics is a leading credit and ESG research specialist and a provider of technology solutions for differentiated fixed income strategies. Our roots are in bottom-up fundamental credit analysis with a specialization in high yield corporate credits from Europe, Asia and Latin America. We are one of few research specialists integrating ESG considerations with fundamental credit research through a dedicated ESG platform. Our ESG assessment covers five key criteria: Disclosure, E,S, & G Pillars, Controversies, ESG Impact on Credit and ESG Momentum.

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Our company has been at the forefront of developments in the fixed income markets, identifying opportunities and consistently delivering new products and value-adding solutions to clients. Lucror has close relationships with the largest and most reputable asset managers, family offices, hedge funds, investment and wealth managers globally.

Credit

SJM Holdings has released Q4 and FY 2023 numbers that were mixed, in our view. The ramp-up of Grand Lisboa Palace (GLP) remained slow, with the asset's GGR increasing 11% q-o-q in Q4 (in line with industry growth). As a result, SJM’s market share from Q2 to Q4 remained stagnant at c. 12%. On a brighter note, GLP achieved EBITDA breakeven in Q4/23, with earnings likely to rise further in FY 2024 (on the back of broader industry growth). In addition, excess staff costs stemming from the late-2022 closure of satellite casinos continued to narrow. The EBITDA margin has recovered to the pre-pandemic level of 12%, thanks to improvement in the higher-margin mass gaming segment, albeit this was partly offset by the impact from excess staff costs. We expect SJM to generate slightly positive FCF in FY 2024 (vs. neutral FCF in Q4/23). That said, the company’s profitability should lag that of peers for the next 1-2 years, as it is unlikely that the costs associated with having excess gaming staff on the payroll will be fully resolved until 2025. This means that SJM’s pace of deleveraging may remain slower than peers.

  SJM Holdings has released Q4 and FY 2023 numbers that were mixed, in our view. The ramp-up of Grand Lisboa Palace (GLP) remained slow, with the asset's GGR increasing 11% q-o-q in Q4 (in line with industry growth). As a result, SJM’s market share from Q2 to Q4 remained stagnant at c. 12%.   On a brighter note, GLP achieved EBITDA breakeven in Q4/23, with earnings likely to rise further in FY 2024 (on the back of broader industry growth). In addition, excess staff costs stemming from the late-2022 closure of satellite casinos continued to narrow. The EBITDA margin has recovered to the pre-pandemic level of 12%, thanks to improvement in the higher-margin mass gaming segment, albeit this was partly offset by the impact from excess staff costs.   We expect SJM to generate slightly positive FCF in FY 2024 (vs. neutral FCF in Q4/23). That said, the company’s profitability should lag that of peers for the next 1-2 years, as it is unlikely that the costs associated with having excess gaming staff on the payroll will be fully resolved until 2025. This means that SJM’s pace of deleveraging may remain slower than peers. 

SJM Holdings - Earnings Flash - FY 2023 Results - Lucror Analytics

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Hong Kong

SJM Holdings is a leading owner, operator, and developer of casinos and integrated entertainment resorts in Macau. The company's operations encompass casino gaming, hotels, dining, shopping, and wellness facilities. SJM Holdings was incorporated in Hong Kong in 2006 and is headquartered in Central, Hong Kong.

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SJM Holdings (880 HK)

Last Week in Event SPACE: Aussie Tax-Loss Selling, Austal, West Japan Railway, PICC/PICC P&C

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