Asian Insight Provider - Actionable ideas, CrossASEAN Research

Henry Soediarko

Asian Insight Provider - Actionable ideas

Thematic (Sector/Industry)

<p>Despite the economic slowdown and low oil price, remittance continues to be an important component of Philippine's GDP. The OFWs are infamous for having the right working culture and always try to send money back to improve the living condition back home. </p><p><a href="https://www.smartkarma.com/entities/329" target="_blank" data-smartkarma-citation="entities:329:1">BDO Unibank Inc (BDO PM)</a> holds the largest share of the remittance from OFW and is controlled by <a href="https://www.smartkarma.com/entities/20015" target="_blank" data-smartkarma-citation="entities:20015:1">Sm Investments Corp (SM PM)</a>. This relationship also benefits BDO when SM develops malls, BDO will automatically be the preferred bank of these malls.</p>

Despite the economic slowdown and low oil price, remittance continues to be an important component of Philippine's GDP. The OFWs are infamous for having the right working culture and always try to send money back to improve the living condition back home. BDO Unibank Inc (BDO PM) holds the largest share of the remittance from OFW and is controlled by Sm Investments Corp (SM PM). This relationship also benefits BDO when SM develops malls, BDO will automatically be the preferred bank of these malls.

SGX Market Strategist, Equity & Fixed Income, Singapore Exchange Ltd (SGX)

Geoff Howie

SGX Market Strategist, Equity & Fixed Income

Asia’s leading multi-asset exchange

Singapore Exchange Ltd (SGX)

Singapore Exchange is Asia’s leading and trusted market infrastructure, facilitating the exchange of capital and ideas to create value for people, businesses and economies. As a multi-asset exchange operating equity, fixed income and derivatives markets to the highest regulatory standards, SGX is a vertically integrated business that provides listing, trading, clearing, settlement, depository and data services.

With about 40% of listed companies and over 80% of listed bonds originating outside of Singapore as well as established linkages across the region and in Europe, SGX is Asia’s most international and connected exchange. Offering a full suite of derivatives products across Asian equity indices, commodities and currencies, SGX is the world’s most liquid international market for the benchmark equity indices of China, India, Japan and ASEAN.

As Asia’s pioneering central counterparty, SGX is globally recognised for its risk management and clearing capabilities, and was one of the first globally to adopt the Principles for Financial Market Infrastructure.

Headquartered in AAA-rated Singapore, SGX has over 800 employees including offices in Beijing, Chicago, Hong Kong, London, New York, Mumbai, San Francisco, Shanghai and Tokyo.

<ul>
<li><strong>SGX lists four stocks mining industrial minerals including tantalite, phosphate, limestone and marble, four coal mining stocks and three gold mining stocks. These 11 stocks are at different stages in the exploration, development, production cycle and have averaged a 19.0% gain in 2017 YTD.</strong></li>
<li>
<strong>Of the three segments, mining industrial minerals has been the strongest performer in the 2017 YTD with an average 30.4% gain, led Alliance Minerals Assets. Coal was the next best performer with the four stocks</strong>…</li>
</ul>


SGX lists four stocks mining industrial minerals including tantalite, phosphate, limestone and marble, four coal mining stocks and three gold mining stocks. These 11 stocks are at different stages in the exploration, development, production cycle and have averaged a 19.0% gain in 2017 YTD.

Of the three segments, mining industrial minerals has been the strongest performer in the 2017 YTD with an average 30.4% gain, led Alliance Minerals Assets. Coal was the next best performer with the four stocks…


Average 19% YTD Gain in Key Mining Stocks

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Equity Capital Markets

Del Monte Philippines / Equity Capital Markets

<div>
<p><a href="https://www.smartkarma.com/entities/del-monte-philippines-inc" target="_blank" data-smartkarma-citation="entities:26988:1" rel="noopener">Del Monte Philippines (1575316D PM)</a>/DMPI is a leading producer, distributor and marketer of premium quality, healthy food and beverage products. It is a market leader in the packaged pineapple and mixed fruit, ready-to-drink juices (excluding stand-up-pouches), tomato sauce and spaghetti sauce categories in the Philippines. DMPI has the rights to the <em>Del Monte</em> trademark for the Philippines for processed products and also sells products under the brands of <em>S&amp;W, Contadina</em> and <em>Today’s</em>.</p>
<p>The parent company is <a href="https://www.smartkarma.com/entities/del-monte-pacific-ltd-5951cd46-129c-41bb-8eb2-58654da08425" target="_blank" data-smartkarma-citation="entities:22651:1" rel="noopener">Del Monte Pacific (DELM PM)</a> which holds 87.0% of outstanding shares. Del Monte Pacific had previously tried to list DMPI on the PSE in 2018 by selling a 20% stake to raise up to $324 million at the maximum offer price of PHP29.88 per share but deferred the IPO due to market volatility.</p>
</div><div><p>Currently, DMPI is pre-marketing for an IPO to raise up to PHP44 billion ($0.9 billion) at the maximum offer price of PHP54.80. The IPO price range, which is generally lower than the maximum IPO price, will be set during the book building process. The pricing date is 12 August and the offer period runs from 16 to 20 August. </p></div><div><div><div class="content-highlight"><p>In <a href="https://www.smartkarma.com/insights/del-monte-philippines-ipo-initiation-tempting-fruit" target="_blank" data-smartkarma-citation="insights:54769" rel="noopener">Del Monte Philippines IPO Initiation: Tempting Fruit</a>, we opined that DMPI is a play on the healthy packaged and convenient packaged food and beverage categories that benefit from long-term secular tailwinds in the Philippines. DMPI’s financial track record shows it has been able to leverage its market-leading position to combine solid top-line growth with improving margins and cash generation. We concluded that DMPI’s fundamentals are attractive. In this note, we present our forecasts and take the first look at DMPI's potential valuation. </p></div></div></div>


Del Monte Philippines (1575316D PM)/DMPI is a leading producer, distributor and marketer of premium quality, healthy food and beverage products. It is a market leader in the packaged pineapple and mixed fruit, ready-to-drink juices (excluding stand-up-pouches), tomato sauce and spaghetti sauce categories in the Philippines. DMPI has the rights to the Del Monte trademark for the Philippines for processed products and also sells products under the brands of S&amp;W, Contadina and Today’s.
The parent company is Del Monte Pacific (DELM PM) which holds 87.0% of outstanding shares. Del Monte Pacific had previously tried to list DMPI on the PSE in 2018 by selling a 20% stake to raise up to $324 million at the maximum offer price of PHP29.88 per share but deferred the IPO due to market volatility.
Currently, DMPI is pre-marketing for an IPO to raise up to PHP44 billion ($0.9 billion) at the maximum offer price of PHP54.80. The IPO price range, which is generally lower than the maximum IPO price, will be set during the book building process. The pricing date is 12 August and the offer period runs from 16 to 20 August. In Del Monte Philippines IPO Initiation: Tempting Fruit, we opined that DMPI is a play on the healthy packaged and convenient packaged food and beverage categories that benefit from long-term secular tailwinds in the Philippines. DMPI’s financial track record shows it has been able to leverage its market-leading position to combine solid top-line growth with improving margins and cash generation. We concluded that DMPI’s fundamentals are attractive. In this note, we present our forecasts and take the first look at DMPI's potential valuation. 

Del Monte Philippines IPO: Valuation First-Look

<p><a href="https://www.smartkarma.com/entities/allhome-corp" target="_blank" data-smartkarma-citation="entities:28227:1" rel="noopener">AllHome (AHM PM)</a> claims to have pioneered the “one-stop-shop” home improvement retailer in the Philippines. AllHome has announced its IPO price guidance of PHP11.50-14.00 per share, which is below the previously stated maximum offer price of PHP16.00 per share.</p><div class="content-highlight"><p>In our valuation piece based on the maximum offer price, we noted that AllHome's valuation was tailored for growth investors due to the material PEG discount. However, value investors would be put off due to the significant P/E premium to it's domestic and regional peers. Encouragingly, at the low-end of the IPO price range, we believe that the appeal will likely be broad-based and encompass value investors. </p></div><p><strong><em>For reference, our previous notes on AllHome</em></strong><br><em>Initiation note: </em><a href="https://www.smartkarma.com/insights/allhome-ipo-initiation-cash-guzzling-growth" target="_blank" data-smartkarma-citation="insights:31460" rel="noopener">AllHome IPO Initiation: Cash-Guzzling Growth</a>  <br><em>Benchmarking study: </em><a href="https://www.smartkarma.com/insights/allhome-ipo-benchmarking-points-to-a-trade-off-between-growth-margin-and-returns" target="_blank" data-smartkarma-citation="insights:32246" rel="noopener">AllHome IPO: Benchmarking Points to a Trade-Off Between Growth/Margin and Returns</a> <br><em>Valuation: </em><a href="https://www.smartkarma.com/insights/allhome-ipo-valuation-tailored-for-growth-investors" target="_blank" data-smartkarma-citation="insights:32356" rel="noopener">AllHome IPO: Valuation Tailored for Growth Investors</a> </p>

AllHome (AHM PM) claims to have pioneered the “one-stop-shop” home improvement retailer in the Philippines. AllHome has announced its IPO price guidance of PHP11.50-14.00 per share, which is below the previously stated maximum offer price of PHP16.00 per share.In our valuation piece based on the maximum offer price, we noted that AllHome's valuation was tailored for growth investors due to the material PEG discount. However, value investors would be put off due to the significant P/E premium to it's domestic and regional peers. Encouragingly, at the low-end of the IPO price range, we believe that the appeal will likely be broad-based and encompass value investors. For reference, our previous notes on AllHome Initiation note: AllHome IPO Initiation: Cash-Guzzling Growth   Benchmarking study: AllHome IPO: Benchmarking Points to a Trade-Off Between Growth/Margin and Returns  Valuation: AllHome IPO: Valuation Tailored for Growth Investors 

AllHome IPO: Broader Appeal at the Low-End

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

Equity Bottom-Up

<p>Right before Christmas 2017, <a href="https://www.smartkarma.com/entities/20178" target="_blank" data-smartkarma-citation="entities:20178:1">Sri Rejeki Isman Tbk Pt (SRIL IJ)</a> announced that they are purchasing Primayudha and Bitratex, both are manufacturers of yarn based in Indonesia with a heavy focus on exports. A conversation with the management last Friday confirmed that the deal is still in the midst of due diligence hence no sale and purchase agreement has been signed and no price has been agreed. </p><h2>A brief background on the deal</h2><p>Both target companies are yarn producer with operation in East and…</p>

Right before Christmas 2017, Sri Rejeki Isman Tbk Pt (SRIL IJ) announced that they are purchasing Primayudha and Bitratex, both are manufacturers of yarn based in Indonesia with a heavy focus on exports. A conversation with the management last Friday confirmed that the deal is still in the midst of due diligence hence no sale and purchase agreement has been signed and no price has been agreed. A brief background on the dealBoth target companies are yarn producer with operation in East and…

A Talk with Sritex on New Acquisition and More

Philippines

D&L Industries is a Filipino company specializing in product customization and manufacturing for the food, chemicals, plastics, and consumer products original design manufacturer (ODM) industries. The company produces customized food ingredients, specialty raw materials for plastics, oleochemicals for personal and home care, and aerosol products. It was established in 1963 and is headquartered in Quezon City, Philippines.

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D&L Industries (DNL PM)

Overseas Filipino Workers: Beneficiaries

Despite the economic slowdown and low oil price, remittance continues to be an important component of Philippine's GDP. The OFWs are infamous for...

Henry Soediarko

Average 19% YTD Gain in Key Mining Stocks

SGX lists four stocks mining industrial minerals including tantalite, phosphate, limestone and marble, four coal mining stocks and three gold...

Singapore Exchange Ltd (SGX)

Del Monte Philippines IPO: Valuation First-Look

DMPI is pre-marketing for an IPO to raise up to $0.9 billion at the maximum offer price of PHP54.80. In this note, we present our forecasts and...

Arun George

AllHome IPO: Broader Appeal at the Low-End

AllHome (AHM PM) claims to have pioneered the “one-stop-shop” home improvement retailer in the Philippines. AllHome has announced its IPO price...

Arun George

A Talk with Sritex on New Acquisition and More

Right before Christmas 2017, Sri Rejeki Isman Tbk Pt (SRIL IJ) announced that they are purchasing Primayudha and Bitratex, both are manufacturers...

Henry Soediarko

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