Pan-Asia Equity Bottom-up, Wickhams Hill

Lloyd Moffatt

Pan-Asia Equity Bottom-up

Equity Bottom-Up

Cisarua Mountain Dairy / Equity Bottom-Up

<ul><li>A deeper look into Cisarua Mountain Dairy – Cimory (CMRY IJ) since we initially highlighted the deal in Issue 8 revealed that is business is not nearly attractive as it appeared</li><li>Cosco’s spin-off of liquor distribution subsidiary Keepers (KEEPR PM) has received strong investor demand following a move to reprice the offering 25% below the low end of the original range</li><li>Robinsons Land (RLC PM) announced a P3bn buyback that’s equivalent to around 3% of their market cap</li></ul>

A deeper look into Cisarua Mountain Dairy – Cimory (CMRY IJ) since we initially highlighted the deal in Issue 8 revealed that is business is not nearly attractive as it appearedCosco’s spin-off of liquor distribution subsidiary Keepers (KEEPR PM) has received strong investor demand following a move to reprice the offering 25% below the low end of the original rangeRobinsons Land (RLC PM) announced a P3bn buyback that’s equivalent to around 3% of their market cap

Wickhams Hill Research | Under-The-Radar Issue 12

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Index Rebalance

<p>The Philippines Stock Exchange has announced the changes to the <a href="https://www.smartkarma.com/entities/philippines-stock-exchange-psei-index" target="_blank" data-smartkarma-citation="entities:22912:1" rel="noopener">Philippines Stock Exchange PSEi Index (PCOMP INDEX)</a> as part of the August rebalance.</p><p><a href="https://www.smartkarma.com/entities/ac-energy-corp" target="_blank" data-smartkarma-citation="entities:23188:1" rel="noopener">AC Energy Corp (ACEN PM)</a> and <a href="https://www.smartkarma.com/entities/converge-ict-solutions-inc-609f7498-aeeb-430e-a07d-50503172a1e3" target="_blank" data-smartkarma-citation="entities:31210:1" rel="noopener">Converge ICT Solutions (CNVRG PM)</a> have been added to the index while <a href="https://www.smartkarma.com/entities/emperador-inc" target="_blank" data-smartkarma-citation="entities:3485:1" rel="noopener">Emperador Inc (EMP PM)</a> and <a href="https://www.smartkarma.com/entities/dmci-holdings-inc" target="_blank" data-smartkarma-citation="entities:8026:1" rel="noopener">DMCI Holdings (DMC PM)</a> have been deleted.</p><p>There are minimal assets tracking the <a href="https://www.smartkarma.com/entities/philippines-stock-exchange-psei-index" target="_blank" data-smartkarma-citation="entities:22912:1" rel="noopener">Philippines Stock Exchange PSEi Index (PCOMP INDEX)</a>. However, there are active funds using the index as a benchmark and some of the funds track the benchmark pretty closely. The impact is clearly visible today with <a href="https://www.smartkarma.com/entities/emperador-inc" target="_blank" data-smartkarma-citation="entities:3485:1" rel="noopener">Emperador Inc (EMP PM)</a> and <a href="https://www.smartkarma.com/entities/dmci-holdings-inc" target="_blank" data-smartkarma-citation="entities:8026:1" rel="noopener">DMCI Holdings (DMC PM)</a> lower by 9.5% and 5%, while <a href="https://www.smartkarma.com/entities/ac-energy-corp" target="_blank" data-smartkarma-citation="entities:23188:1" rel="noopener">AC Energy Corp (ACEN PM)</a> and <a href="https://www.smartkarma.com/entities/converge-ict-solutions-inc-609f7498-aeeb-430e-a07d-50503172a1e3" target="_blank" data-smartkarma-citation="entities:31210:1" rel="noopener">Converge ICT Solutions (CNVRG PM)</a> are up 4% and 13% respectively.</p><p>We had <a href="https://www.smartkarma.com/entities/ac-energy-corp" target="_blank" data-smartkarma-citation="entities:23188:1" rel="noopener">AC Energy Corp (ACEN PM)</a> as an inclusion and <a href="https://www.smartkarma.com/entities/emperador-inc" target="_blank" data-smartkarma-citation="entities:3485:1" rel="noopener">Emperador Inc (EMP PM)</a> as a deletion. <a href="https://www.smartkarma.com/entities/dmci-holdings-inc" target="_blank" data-smartkarma-citation="entities:8026:1" rel="noopener">DMCI Holdings (DMC PM)</a> was a close delete. <a href="https://www.smartkarma.com/entities/converge-ict-solutions-inc-609f7498-aeeb-430e-a07d-50503172a1e3" target="_blank" data-smartkarma-citation="entities:31210:1" rel="noopener">Converge ICT Solutions (CNVRG PM)</a> was added following a rule change that was announced and implemented at the same time as the constituent changes and that resulted in the deletion of <a href="https://www.smartkarma.com/entities/dmci-holdings-inc" target="_blank" data-smartkarma-citation="entities:8026:1" rel="noopener">DMCI Holdings (DMC PM)</a> as well.</p><p>There are also some rule changes related minimum free float, to Fast Entry for stocks, and to the inclusion/exclusion cutoff rankings at the regular rebalances.</p>

The Philippines Stock Exchange has announced the changes to the Philippines Stock Exchange PSEi Index (PCOMP INDEX) as part of the August rebalance.AC Energy Corp (ACEN PM) and Converge ICT Solutions (CNVRG PM) have been added to the index while Emperador Inc (EMP PM) and DMCI Holdings (DMC PM) have been deleted.There are minimal assets tracking the Philippines Stock Exchange PSEi Index (PCOMP INDEX). However, there are active funds using the index as a benchmark and some of the funds track the benchmark pretty closely. The impact is clearly visible today with Emperador Inc (EMP PM) and DMCI Holdings (DMC PM) lower by 9.5% and 5%, while AC Energy Corp (ACEN PM) and Converge ICT Solutions (CNVRG PM) are up 4% and 13% respectively.We had AC Energy Corp (ACEN PM) as an inclusion and Emperador Inc (EMP PM) as a deletion. DMCI Holdings (DMC PM) was a close delete. Converge ICT Solutions (CNVRG PM) was added following a rule change that was announced and implemented at the same time as the constituent changes and that resulted in the deletion of DMCI Holdings (DMC PM) as well.There are also some rule changes related minimum free float, to Fast Entry for stocks, and to the inclusion/exclusion cutoff rankings at the regular rebalances.

PCOMP Index Rebalance: ACEN, CNVRG Added; EMP, DMCI Deleted

<ul>
<li>mm2 Asia Ltd (MM2 SP), which we flagged in our inaugural issue last week, received<br>an unsolicited bid for their Singapore and Malaysian cinema business. The offer made would imply a share price of about SGD 16.2cents, +140% from today’s close.</li>
<li>We uncover a massive buyback program underway at Alliance Global Group (AGI<br>PM), Emperador (EMP PM) and Megaworld (MEG PM).</li>
<li>The US$1.5bn IPO of Indonesian online flea market Bukalapak (BUKA IJ) is planned for next week. While another Asia focused SPAC files for US listing.</li>
</ul>


mm2 Asia Ltd (MM2 SP), which we flagged in our inaugural issue last week, received an unsolicited bid for their Singapore and Malaysian cinema business. The offer made would imply a share price of about SGD 16.2cents, +140% from today’s close.
We uncover a massive buyback program underway at Alliance Global Group (AGI PM), Emperador (EMP PM) and Megaworld (MEG PM).
The US$1.5bn IPO of Indonesian online flea market Bukalapak (BUKA IJ) is planned for next week. While another Asia focused SPAC files for US listing.


Wickhams Hill Research | Under-The-Radar Issue 2

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>The <a href="https://www.smartkarma.com/entities/philippines-stock-exchange-psei-index" target="_blank" data-smartkarma-citation="entities:22912:1" rel="noopener">Philippines Stock Exchange PSEi Index (PCOMP INDEX)</a> is the main index of the Philippines Stock Exchange (PSE). The index is free float market cap weighted and is made up of the 30 largest and most active common stocks listed at the PSE.</p><p>The next rebalance will become effective in mid-August and the changes will be announced around 5 trading days prior to implementation.</p><p>We see <a href="https://www.smartkarma.com/entities/ac-energy-corp" target="_blank" data-smartkarma-citation="entities:23188:1" rel="noopener">AC Energy Corp (ACEN PM)</a> as a likely inclusion in the index. Potential deletions are <a href="https://www.smartkarma.com/entities/emperador-inc" target="_blank" data-smartkarma-citation="entities:3485:1" rel="noopener">Emperador Inc (EMP PM)</a> on liquidity and possibly free float and <a href="https://www.smartkarma.com/entities/dmci-holdings-inc" target="_blank" data-smartkarma-citation="entities:8026:1" rel="noopener">DMCI Holdings (DMC PM)</a> as the lowest ranked index constituent.</p><p>There are minimal assets tracking the <a href="https://www.smartkarma.com/entities/philippines-stock-exchange-psei-index" target="_blank" data-smartkarma-citation="entities:22912:1" rel="noopener">Philippines Stock Exchange PSEi Index (PCOMP INDEX)</a>. However, there are active funds using the index as a benchmark and some of the funds track the benchmark pretty closely. Historically, the adds have performed well in the period leading up to implementation.</p>

The Philippines Stock Exchange PSEi Index (PCOMP INDEX) is the main index of the Philippines Stock Exchange (PSE). The index is free float market cap weighted and is made up of the 30 largest and most active common stocks listed at the PSE.The next rebalance will become effective in mid-August and the changes will be announced around 5 trading days prior to implementation.We see AC Energy Corp (ACEN PM) as a likely inclusion in the index. Potential deletions are Emperador Inc (EMP PM) on liquidity and possibly free float and DMCI Holdings (DMC PM) as the lowest ranked index constituent.There are minimal assets tracking the Philippines Stock Exchange PSEi Index (PCOMP INDEX). However, there are active funds using the index as a benchmark and some of the funds track the benchmark pretty closely. Historically, the adds have performed well in the period leading up to implementation.

PCOMP Index Rebalance Preview: Inclusion Fairly Certain; Deletion Undecided

Philippines

Emperador Inc. is a global spirits company that manufactures, bottles, and distributes distilled spirits and other alcoholic beverages. The company's portfolio includes award-winning brandy and whisky brands, such as Emperador Brandy, The Dalmore, Jura, and Fundador. Emperador Inc. is headquartered in Quezon City, Philippines, and was founded in 1979.

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Emperador (EMI PM)

Wickhams Hill Research | Under-The-Radar Issue 12

A deeper look into Cisarua Mountain Dairy – Cimory (CMRY IJ) since we initially highlighted the deal in Issue 8 revealed that is business is not...

Lloyd Moffatt

PCOMP Index Rebalance: ACEN, CNVRG Added; EMP, DMCI Deleted

ACEN and CNVRG have been added to the index replacing EMP and DMC. Historically inclusions have outperformed the deletions. There are rule changes...

Brian Freitas

Wickhams Hill Research | Under-The-Radar Issue 2

mm2 Asia Ltd (MM2 SP), which we flagged in our inaugural issue last week, receivedan unsolicited bid for their Singapore and Malaysian cinema business

Lloyd Moffatt

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

PCOMP Index Rebalance Preview: Inclusion Fairly Certain; Deletion Undecided

We see ACEN being included and EMP being deleted from the PCOMP at the August rebalance. Inclusions have historically performed well while the...

Brian Freitas

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