Equity Analyst - Asia Consumer Sector, Investory

Devi Subhakesan

Equity Analyst - Asia Consumer Sector

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.

Thematic (Sector/Industry)

<p> In this Smartkarma Original Series report, we scan the Asia Direct-to-Consumer (D2C) channel space for Consumer Packaged Goods to identify the verticals that have gained wider consumer acceptance and witnessed steady growth in each of the key geographies - China, South East Asia, and India. We look into the factors that enabled notable D2C brands in the Beauty, Fashion, and Food verticals to make steady inroads and disrupt the sector within a short period. We discuss the D2C ecosystem, brand journey and key challenges. 2020 has been the year that fast-tracked online retail penetration in most parts of Asia. In this context, we profile D2C brands with either a dominant segment presence or unique business model to gain a deeper understanding of the Asia D2C landscape.</p>
<p><strong>What is original about this report?</strong> Insights and takeaways for Investors in Asia D2C branded players in consumer space based on our comparative study of the segment across three key geographies - China, SE Asia, and India. China's early march in digital transformation and D2C market space offers valuable lessons to players/investors in early-stage digital markets like India which is witnessing aggressive traction in this space. Insights discussed in the report have mostly been weaned from the startup experiences shared by founders of reputed D2C brands. The report also analyses investment outlook for select digitally native D2C brands with lead segment presence and/or unique business models.</p>

 In this Smartkarma Original Series report, we scan the Asia Direct-to-Consumer (D2C) channel space for Consumer Packaged Goods to identify the verticals that have gained wider consumer acceptance and witnessed steady growth in each of the key geographies - China, South East Asia, and India. We look into the factors that enabled notable D2C brands in the Beauty, Fashion, and Food verticals to make steady inroads and disrupt the sector within a short period. We discuss the D2C ecosystem, brand journey and key challenges. 2020 has been the year that fast-tracked online retail penetration in most parts of Asia. In this context, we profile D2C brands with either a dominant segment presence or unique business model to gain a deeper understanding of the Asia D2C landscape.
What is original about this report? Insights and takeaways for Investors in Asia D2C branded players in consumer space based on our comparative study of the segment across three key geographies - China, SE Asia, and India. China's early march in digital transformation and D2C market space offers valuable lessons to players/investors in early-stage digital markets like India which is witnessing aggressive traction in this space. Insights discussed in the report have mostly been weaned from the startup experiences shared by founders of reputed D2C brands. The report also analyses investment outlook for select digitally native D2C brands with lead segment presence and/or unique business models.

D2C Brands in Asia: Disruption Potential in Consumer Space

India - Politics, Industrials, IT and Large Caps, EMAlpha

Pankaj Sharma

India - Politics, Industrials, IT and Large Caps

<p>Rural is likely to be an interesting investment theme in Indian markets because of expectations that the Govt will focus more on agriculture. There are several options to play this but if we apply filters like recent stock performance, market positioning and relative contribution of rural and its importance as a stock driver, we think <a href="https://www.smartkarma.com/entities/2391" target="_blank" data-smartkarma-citation="entities:2391:1">Hero Motocorp Ltd (HMCL IN)</a>, <a href="https://www.smartkarma.com/entities/242" target="_blank" data-smartkarma-citation="entities:242:1">Dabur India Ltd (DABUR IN)</a> and <a href="https://www.smartkarma.com/entities/12089" target="_blank" data-smartkarma-citation="entities:12089:1">Dhanuka Agritech Ltd (DAGRI IN)</a> are among more interesting names.</p>

Rural is likely to be an interesting investment theme in Indian markets because of expectations that the Govt will focus more on agriculture. There are several options to play this but if we apply filters like recent stock performance, market positioning and relative contribution of rural and its importance as a stock driver, we think Hero Motocorp Ltd (HMCL IN), Dabur India Ltd (DABUR IN) and Dhanuka Agritech Ltd (DAGRI IN) are among more interesting names.

India: Three Stocks to Play the Rural Theme

Making sense of the Global Market, Euromonitor International Ltd.

Yu Mitsuhashi

Making sense of the Global Market

Euromonitor International Ltd.

We are a global market research company focused on industries, countries, economies and consumers worldwide. Our cross-country comparable research helps your organisation identify opportunities and develop growth strategies in countries and regions across the globe. With offices around the world, 1,200 analysts in 100 countries and market research on every key trend and driver, we give you powerful access to the real story behind consumer change.

<h2>Headlines</h2><ul>
<li>Laundry care records current value growth of 9% in 2016 to reach INR205 billion in 2016</li>
<li>With increasing awareness, consumers are shifting from bar to powder detergents driving growth</li>
<li>The average unit price increases by 5% in current value terms in 2016 due to increasing inflation</li>
<li>Hindustan Unilever Ltd leads laundry care with a value share of 37% in 2016</li>
<li>Laundry care in India is expected to record a value CAGR of 2% at constant 2016 prices during the forecast period</li>
</ul><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/022/657/original/market%20size%20laundry%20care%20india%2011-16.png?1489628435" class="editor-image img-responsive" data-smartkarma-image-id="22657"></figure><h2>Competitive Landscape</h2><ul><li>…</li></ul>

Headlines
Laundry care records current value growth of 9% in 2016 to reach INR205 billion in 2016
With increasing awareness, consumers are shifting from bar to powder detergents driving growth
The average unit price increases by 5% in current value terms in 2016 due to increasing inflation
Hindustan Unilever Ltd leads laundry care with a value share of 37% in 2016
Laundry care in India is expected to record a value CAGR of 2% at constant 2016 prices during the forecast period
Competitive Landscape…

Specialist in Indian Banking and Economic Research

Hemindra Hazari

<p>Historically, India’s net oil subsidy was a myth after factoring taxes on petroleum products. But in the last two years, as oil prices declined internationally, the Government went further, and shifted to an oppressive regime of punitive oil taxes. <strong>In earlier years, economists linked to the capital market were vociferous in their condemnation of oil subsidies, and advocated ‘market pricing’ of this key resource, as subsidies, they argued, distorted the market. Even at that time, their argument ignored the glaring fact of taxes on petroleum products. However, it is even more remarkable that for the past two years the same economists populating policy-making, credit rating and capital markets appear to have lost their voices when the Indian government violated market prices in the <em>contrary</em> direction, sharply raising the rate of petroleum taxes.</strong> This was done despite the demand slowdown in the economy. Heavy petroleum taxes have no doubt helped to meet fiscal deficit commitments and satisfying global investors. But they have helped suppress an already faltering consumer demand.</p>

Historically, India’s net oil subsidy was a myth after factoring taxes on petroleum products. But in the last two years, as oil prices declined internationally, the Government went further, and shifted to an oppressive regime of punitive oil taxes. In earlier years, economists linked to the capital market were vociferous in their condemnation of oil subsidies, and advocated ‘market pricing’ of this key resource, as subsidies, they argued, distorted the market. Even at that time, their argument ignored the glaring fact of taxes on petroleum products. However, it is even more remarkable that for the past two years the same economists populating policy-making, credit rating and capital markets appear to have lost their voices when the Indian government violated market prices in the contrary direction, sharply raising the rate of petroleum taxes. This was done despite the demand slowdown in the economy. Heavy petroleum taxes have no doubt helped to meet fiscal deficit commitments and satisfying global investors. But they have helped suppress an already faltering consumer demand.

<h2>Headlines</h2><ul>
<li>Sugar confectionery value sales increased by 16% in 2016, to reach INR78 billion, with volumes increasing by 11% to reach 305,000 tonnes</li>
<li>Increasing consumer spending and a greater number of variants support growth in sugar confectionery in 2016</li>
<li>Pastilles, gums, jellies and chews remains the fastest-growing category, with value increasing by 22% in 2016</li>
<li>The average unit price increases by 4% in 2016</li>
<li>Perfetti Van Melle India Pvt Ltd remains the leading manufacturer in 2016, with a value share…</li>
</ul>

Headlines
Sugar confectionery value sales increased by 16% in 2016, to reach INR78 billion, with volumes increasing by 11% to reach 305,000 tonnes
Increasing consumer spending and a greater number of variants support growth in sugar confectionery in 2016
Pastilles, gums, jellies and chews remains the fastest-growing category, with value increasing by 22% in 2016
The average unit price increases by 4% in 2016
Perfetti Van Melle India Pvt Ltd remains the leading manufacturer in 2016, with a value share…


Sector Capsule: Sugar Confectionery in India

India

Colgate-Palmolive (India) Ltd. manufactures consumer products in the oral care and body care area. The Company's products include soaps, cosmetics, toilet preparations, toothpaste, toothbrushes, shaving brushes, and glycerin.

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Colgate Palmolive (India) (CLGT IN)

D2C Brands in Asia: Disruption Potential in Consumer Space

Insights for investors based on comparative study of Asia D2C landscape across India, SE Asia & China.Analysis of relative segment attractiveness....

Devi Subhakesan

India: Three Stocks to Play the Rural Theme

Rural is likely to be an interesting investment theme in Indian markets because of expectations that the Govt will focus more on agriculture. There...

Pankaj Sharma

Sector Capsule: Laundry Care in India

Headlines Laundry care records current value growth of 9% in 2016 to reach INR205 billion in 2016 With increasing awareness, consumers are shifting...

Euromonitor International Ltd.

Oil Cess - Squeezing the Economy

Historically, India’s net oil subsidy was a myth after factoring taxes on petroleum products. But in the last two years, as oil prices declined...

Hemindra Hazari

Sector Capsule: Sugar Confectionery in India

Headlines Sugar confectionery value sales increased by 16% in 2016, to reach INR78 billion, with volumes increasing by 11% to reach 305,000...

Euromonitor International Ltd.

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