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.

Event-Driven

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<li>
<a href="https://www.smartkarma.com/entities/dickson-concepts-intl-ltd" target="_blank" data-smartkarma-citation="entities:5052:1" rel="noopener">Dickson Concepts Intl (113 HK)</a> has entered a trading halt “<em>pending the release of an announcement pursuant to The Code on Takeovers and Mergers, which constitutes inside information of the Company.</em>”  </li>
<li>The controlling shareholder (Sir Poon) is likely seeking to launch a privatisation through a Bermuda scheme, particularly as the shares trade below net cash.</li>
<li>While no disinterested shareholder holds a blocking stake, the headcount test and a decent AGM participation rate necessitate an attractive offer. The potential offer price range is HK$5.60-9.24.</li>
</ul>



Dickson Concepts Intl (113 HK) has entered a trading halt “pending the release of an announcement pursuant to The Code on Takeovers and Mergers, which constitutes inside information of the Company.”  
The controlling shareholder (Sir Poon) is likely seeking to launch a privatisation through a Bermuda scheme, particularly as the shares trade below net cash.
While no disinterested shareholder holds a blocking stake, the headcount test and a decent AGM participation rate necessitate an attractive offer. The potential offer price range is HK$5.60-9.24.


Dickson Concepts (113 HK): Controlling Shareholder to Privatise a Negative EV Play?

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>
<strong><a href="https://www.smartkarma.com/entities/dickson-concepts-intl-ltd" target="_blank" data-smartkarma-citation="entities:5052:1" rel="noopener">Dickson Concepts Intl (113 HK)</a></strong> (DC), which is principally engaged in the sale of luxury goods business, is suspended pursuant to the Takeovers Code.</li>
<li>DC's Chairman, Dickson Poon (&amp; spouse), hold 60.5%. Super-net-cash rich DC is trading in sync with historical metrics. 1H25 (Mar Y/E) net profit dropped 40.1%. Shares are roughly flat yoy. </li>
<li>Given DC's cash hoard, taking the company private makes sense. I doubt Poon is seeking to exit his stake.</li>
</ul>



Dickson Concepts Intl (113 HK) (DC), which is principally engaged in the sale of luxury goods business, is suspended pursuant to the Takeovers Code.
DC's Chairman, Dickson Poon (&amp; spouse), hold 60.5%. Super-net-cash rich DC is trading in sync with historical metrics. 1H25 (Mar Y/E) net profit dropped 40.1%. Shares are roughly flat yoy. 
Given DC's cash hoard, taking the company private makes sense. I doubt Poon is seeking to exit his stake.


Poon Moves On Dickson Concepts (113 HK)'s Cash Hoard?

Equity, Bottom-up Analyst, Investics Research

Sameer Taneja

Equity, Bottom-up Analyst

Investics Research

It is important to note that the information provided by Investics Research is based on publicly available data and own knowledge, which has been gathered and analyzed from a variety of sources. While every effort has been made to ensure the accuracy and completeness of the information provided, it is not guaranteed to be free from errors or omissions. All forecasts and estimates are based on information that has been obtained from public sources that are considered to be reliable. The sources include but are not limited to, company announcements, exchange filings, presentations, etc. Investics does not guarantee the accuracy and completeness of the forecasts, estimates, and/or other information.

Equity Bottom-up Research

Equity Bottom-Up

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<li>Dickson Concepts Intl (113 HK) reported earnings growth of 39% YoY, led mostly by an increase in interest income on the 9.6 HKD/share of net cash/investments on the balance sheet. </li>
<li>The company's net current asset value (NCAV) expanded to 8.2 HKD/share (Vs. FY23: 7.6 HKD/share), and with the stock at 5.2 HKD/share, it trades at a 37% discount to NCAV. </li>
<li>The dividend was increased to 45 cents ( from FY23:35 cents/share), placing the stock at an attractive dividend yield of 8.6%.</li>
</ul>


Dickson Concepts Intl (113 HK) reported earnings growth of 39% YoY, led mostly by an increase in interest income on the 9.6 HKD/share of net cash/investments on the balance sheet. 
The company's net current asset value (NCAV) expanded to 8.2 HKD/share (Vs. FY23: 7.6 HKD/share), and with the stock at 5.2 HKD/share, it trades at a 37% discount to NCAV. 
The dividend was increased to 45 cents ( from FY23:35 cents/share), placing the stock at an attractive dividend yield of 8.6%.


Dickson Concepts (113 HK): 38% Discount to NCAV, 8.6% Dividend Yield, Steady FY24

<ul>
<li>Dickson Concepts Intl (113 HK) reported the best result in its last six semi-annuals in H1 FY24, with profits rising 42% YoY. </li>
<li>Net cash on the balance sheet was 9.6 HKD/share (vs. share price of 4.54 HKD/share). Gross cash was over 12 HKD/share. </li>
<li>The company increased its interim dividend by 25% to 10 cents for the first time after four years (the expected full-year dividend is 37-40 cents).</li>
</ul>


Dickson Concepts Intl (113 HK) reported the best result in its last six semi-annuals in H1 FY24, with profits rising 42% YoY. 
Net cash on the balance sheet was 9.6 HKD/share (vs. share price of 4.54 HKD/share). Gross cash was over 12 HKD/share. 
The company increased its interim dividend by 25% to 10 cents for the first time after four years (the expected full-year dividend is 37-40 cents).


Dickson Concept (113 HK) Update: Trading at 40% Discount to NCAV, 8% Dividend Yield

<ul>
<li>In my previous insight <a href="https://www.smartkarma.com/insights/dickson-concepts-113-hk-straight-from-the-ben-graham-stable-40-discount-to-ncav" target="_blank" data-smartkarma-citation="insights:102890" rel="noopener">Dickson Concepts 113 HK: Straight From The Ben Graham Stable, &gt;40% Discount to NCAV</a>, I highlighted why one must explore the stock as a viable investment.</li>
<li>NCAV (Net current asset value) in FY23 was 7.5 HKD/share ( Vs. current share price of 4.25 HKD/share), with net cash + ST/LT financial investments now at 9.7 HKD/share. </li>
<li>Absolute DPS ( dividend per share) was 35 cents representing a yield of 8.2% ( payout ratio of 55%). The trailing PE is 6.6x FY23. </li>
</ul>


In my previous insight Dickson Concepts 113 HK: Straight From The Ben Graham Stable, &gt;40% Discount to NCAV, I highlighted why one must explore the stock as a viable investment.
NCAV (Net current asset value) in FY23 was 7.5 HKD/share ( Vs. current share price of 4.25 HKD/share), with net cash + ST/LT financial investments now at 9.7 HKD/share. 
Absolute DPS ( dividend per share) was 35 cents representing a yield of 8.2% ( payout ratio of 55%). The trailing PE is 6.6x FY23. 


Dickson Concepts: Gleanings From the FY23 Annual Report

Hong Kong

Dickson Concepts (International) Limited is an investment holding company primarily engaged in the retail and wholesale of luxury goods, including fashion, accessories, watches, jewelry, cosmetics, and leather goods. The company also has a segment for securities investment and provides ancillary services like interior design and property investment. Founded in 1980, it is headquartered in Tsim Sha Tsui, Hong Kong.

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Dickson Concepts (113 HK)