Research from Asian Century Stocks, Asian Century Stocks

Michael Fritzell

Research from Asian Century Stocks

Providing financial journalism in the Asia-Pacific

Asian Century Stocks

Asian Century Stocks is a newsletter providing financial journalism for companies and stocks in the Asia-Pacific. 
The Asian Century Stocks logotype “百” stands for “one hundred” or a “century”. The economic centre of gravity is moving towards Asia. Yet most global investors are missing out.

Equity Bottom-Up

Golden Throat Holdings / Equity Bottom-Up

<ul><li>Golden Throat (6896 HK — US$343 million) is an iconic Chinese brand of throat lozenges, used to deal with sore or dry throats.</li><li>The core product is similar to Strepsils, Halls, or Ricola, but is sold over-the-counter in pharmacies.</li><li>The company sells 146 million boxes per year and has an estimated market share of 26% in China.</li></ul>

Golden Throat (6896 HK — US$343 million) is an iconic Chinese brand of throat lozenges, used to deal with sore or dry throats.The core product is similar to Strepsils, Halls, or Ricola, but is sold over-the-counter in pharmacies.The company sells 146 million boxes per year and has an estimated market share of 26% in China.

Golden Throat (6896 HK): China’s Leading Lozenge Maker at 10x P/E and a 10% Dividend Yield

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

<ul>
<li>Golden Throat Holdings is a gem. It has excellent fundamentals including an eye-catching dividend yield (17.9% in 2023) and a blistering DPS growth (10x from 2020 to 2023). </li>
<li>It also benefits from a compelling long-term theme (relieving sore throats caused by worsening air quality/smog/fine dust problems along with recurrent regular cold/flu symptoms among millions of people in China). </li>
<li>Golden Throat Holdings is one of the leading throat lozenges manufacturers in China. Its net margin averaged 24% from 2019 to 2023.</li>
</ul>


Golden Throat Holdings is a gem. It has excellent fundamentals including an eye-catching dividend yield (17.9% in 2023) and a blistering DPS growth (10x from 2020 to 2023). 
It also benefits from a compelling long-term theme (relieving sore throats caused by worsening air quality/smog/fine dust problems along with recurrent regular cold/flu symptoms among millions of people in China). 
Golden Throat Holdings is one of the leading throat lozenges manufacturers in China. Its net margin averaged 24% from 2019 to 2023.


Asian Dividend Gems: Golden Throat Holdings

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>Schemes In HK can and will fail. But rarely like <a href="https://www.smartkarma.com/entities/golden-throat-holdings-group" target="_blank" data-smartkarma-citation="entities:22664:1" rel="noopener">Golden Throat (6896 HK)</a> did. And not one that was ostensibly pitched at a fair price. </li>
<li>A staggering 55.656mn or 68.875% of Disinterested Shareholders in person or via proxy voted <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/1130/2021113001688.pdf" target="_blank" rel="noopener">against</a> the Scheme. That's also ~7.5% of total shares out. </li>
<li>There was insider trading on the 5 August. Shares declined 6% in two trading days ahead of the vote. Plus 68mn shares moved out of CCASS. Something is not right.</li>
</ul>


Schemes In HK can and will fail. But rarely like Golden Throat (6896 HK) did. And not one that was ostensibly pitched at a fair price. 
A staggering 55.656mn or 68.875% of Disinterested Shareholders in person or via proxy voted against the Scheme. That's also ~7.5% of total shares out. 
There was insider trading on the 5 August. Shares declined 6% in two trading days ahead of the vote. Plus 68mn shares moved out of CCASS. Something is not right.


Golden Throat (6896 HK): This One Left A Bitter Aftertaste

<ul>
<li>You might have to go all the back to <a href="https://www.smartkarma.com/entities/guoco-group-ltd" target="_blank" data-smartkarma-citation="entities:5290:1" rel="noopener">Guoco Group Ltd (53 HK)</a>'s 2012/2013 unconditional cash offer, which was ostensibly blocked by First Eagle AND Elliott Advisors.</li>
<li>Otherwise, it's slim pickings. Past Schemes or Tender Offers arguably failed as minorities were simply not supportive. There are exceptions, like <a href="https://www.smartkarma.com/entities/soho-china-ltd" target="_blank" data-smartkarma-citation="entities:4123:1" rel="noopener">Soho China (410 HK)</a> and <a href="https://www.smartkarma.com/entities/china-traditional-chinese-medicine" target="_blank" data-smartkarma-citation="entities:351:1" rel="noopener">TCM (570 HK)</a>
</li>
<li>IF LVC wish to remain active in this space/region, they appear to be going about it in a counterproductive way. I still don't understand why they would want to block.</li>
</ul>


You might have to go all the back to Guoco Group Ltd (53 HK)'s 2012/2013 unconditional cash offer, which was ostensibly blocked by First Eagle AND Elliott Advisors.
Otherwise, it's slim pickings. Past Schemes or Tender Offers arguably failed as minorities were simply not supportive. There are exceptions, like Soho China (410 HK) and TCM (570 HK)

IF LVC wish to remain active in this space/region, they appear to be going about it in a counterproductive way. I still don't understand why they would want to block.


Henlius (2696 HK): So, When Was The Last Time A PE/VC Outfit Blocked A Deal?

<ul>
<li>Three for three. Three low-balled Hong Kong Offers, by way of Schemes, have now lapsed over the past ten weeks. </li>
<li>Both <a href="https://www.smartkarma.com/entities/goldlion-holdings-ltd" target="_blank" data-smartkarma-citation="entities:12359:1" rel="noopener">Goldlion Holdings (533 HK)</a> and <a href="https://www.smartkarma.com/entities/soundwill-holdings-ltd" target="_blank" data-smartkarma-citation="entities:19318:1" rel="noopener">Soundwill Holdings (878 HK)</a> spectacularly failed back in May.</li>
<li>Now <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 followed suit. But the vote was (much) closer than it should have been.</li>
</ul>


Three for three. Three low-balled Hong Kong Offers, by way of Schemes, have now lapsed over the past ten weeks. 
Both Goldlion Holdings (533 HK) and Soundwill Holdings (878 HK) spectacularly failed back in May.
Now Dickson Concepts Intl (113 HK) has followed suit. But the vote was (much) closer than it should have been.


Dickson Concept (113 HK): More Minority Teeth Bared As Another Scheme Fails

Hong Kong

Golden Throat Holdings Group Company Limited manufactures throat lozenges.  The Company offers its products throughout China.

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Golden Throat Holdings (6896 HK)

Golden Throat (6896 HK): China’s Leading Lozenge Maker at 10x P/E and a 10% Dividend Yield

Golden Throat (6896 HK — US$343 million) is an iconic Chinese brand of throat lozenges, used to deal with sore or dry throats. The core product is...

Asian Century Stocks

Asian Dividend Gems: Golden Throat Holdings

Golden Throat Holdings is one of the leading throat lozenges manufacturers in China. It has an eye-catching dividend yield (17.9% in 2023) and a...

Douglas Kim

Golden Throat (6896 HK): This One Left A Bitter Aftertaste

There is something totally off about this deal. Currently trading at $1.60/share, 11.1% below the "true" undisturbed price. I wouldn't touch this....

David Blennerhassett

Henlius (2696 HK): So, When Was The Last Time A PE/VC Outfit Blocked A Deal?

PE and/or a VC outfit blocking deals are rare. Which may suggest LVC doesn't want that moniker. You could therefore, extrapolate that line of...

David Blennerhassett

Dickson Concept (113 HK): More Minority Teeth Bared As Another Scheme Fails

This is a consistently profitable company. The undisturbed price was $4.78. Yet the HSI is up ~12.8% since the Offer was announced, so perhaps...

David Blennerhassett

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