ASEAN Insight Provider, CrossASEAN Research

Angus Mackintosh

ASEAN Insight Provider

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

<ul>
<li>
<a href="https://www.smartkarma.com/entities/erajaya-swasembada-tbk-pt" target="_blank" data-smartkarma-citation="entities:18869:1" rel="noopener">Erajaya Swasembada (ERAA IJ)</a> booked a solid set of 1H2024 results driven by the availability of affordable handsets, with volumes driving growth despite lower prices. </li>
<li>The company's Erablue consumer electronics JV with <a href="https://www.smartkarma.com/entities/mobile-world-investment-corporation" target="_blank" data-smartkarma-citation="entities:22638:1" rel="noopener">Mobile World Investment (MWG VN)</a> now has 61 outlets and is set to break even in 2024, with 80 stores expected by year-end. </li>
<li>The other growth drivers will come from private-label accessories and its Grand Lucky supermarket expansion. Valuations look attractive will the company trading on a 6x forward PER multiple.</li>
</ul>



Erajaya Swasembada (ERAA IJ) booked a solid set of 1H2024 results driven by the availability of affordable handsets, with volumes driving growth despite lower prices. 
The company's Erablue consumer electronics JV with Mobile World Investment (MWG VN) now has 61 outlets and is set to break even in 2024, with 80 stores expected by year-end. 
The other growth drivers will come from private-label accessories and its Grand Lucky supermarket expansion. Valuations look attractive will the company trading on a 6x forward PER multiple.


Erajaya Swasembada (ERAA IJ) - Affordability Rocks

External broker reports(aggregated public sources), Rong Viet Securities

Rong Viet Securities

External broker reports(aggregated public sources)

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<ul><li>MWG recorded a significant decline in Q1/23 net revenue, plummeting by 26% YoY and 11% QoQ.</li><li>NPAT-MI exhibited a drastic drop of 99% YoY, resulting in minimal profits.</li><li>TGDD and DMX saw a significant decline in net revenue, with a YoY drop of 34% and a QoQ decrease of 11%.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

MWG recorded a significant decline in Q1/23 net revenue, plummeting by 26% YoY and 11% QoQ.NPAT-MI exhibited a drastic drop of 99% YoY, resulting in minimal profits.TGDD and DMX saw a significant decline in net revenue, with a YoY drop of 34% and a QoQ decrease of 11%.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

MWG - On Track to Sales Recovery, yet a Bumpy Road for Full Profit Restoration

<ul>
<li>
<a href="https://www.smartkarma.com/entities/erajaya-swasembada-tbk-pt" target="_blank" data-smartkarma-citation="entities:18869:1" rel="noopener">Erajaya Swasembada (ERAA IJ)</a> is back on track with its handset business, with stronger volume growth driven by more affordable models from Infinix and Techno brands.</li>
<li>The company's buildout of its electrical retailer Erablue, a JV with <a href="https://www.smartkarma.com/entities/mobile-world-investment-corporation" target="_blank" data-smartkarma-citation="entities:22638:1" rel="noopener">Mobile World</a>, is gaining momentum and should become a significant growth driver along with Grand Lucky supermarket.</li>
<li>
<a href="https://www.smartkarma.com/entities/erajaya-swasembada-tbk-pt" target="_blank" data-smartkarma-citation="entities:18869:1" rel="noopener">Erajaya</a> will slow its store buildout this year as it focuses on productivity ny it still expected to add 200 new stores over in Indonesia. Valuation is attractive.</li>
</ul>



Erajaya Swasembada (ERAA IJ) is back on track with its handset business, with stronger volume growth driven by more affordable models from Infinix and Techno brands.
The company's buildout of its electrical retailer Erablue, a JV with Mobile World, is gaining momentum and should become a significant growth driver along with Grand Lucky supermarket.

Erajaya will slow its store buildout this year as it focuses on productivity ny it still expected to add 200 new stores over in Indonesia. Valuation is attractive.


Erajaya Swasembada (ERAA IJ) - Less New Stores with Higher Volumes

<ul><li>MWG recorded a significant decline in Q1/23 net revenue, plummeting by 26% YoY and 11% QoQ.</li><li>NPAT-MI exhibited a drastic drop of 99% YoY, resulting in minimal profits. </li><li>TGDD and DMX saw a significant decline in net revenue, with a YoY drop of 34% and a QoQ decrease of 11%.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

MWG recorded a significant decline in Q1/23 net revenue, plummeting by 26% YoY and 11% QoQ.NPAT-MI exhibited a drastic drop of 99% YoY, resulting in minimal profits. TGDD and DMX saw a significant decline in net revenue, with a YoY drop of 34% and a QoQ decrease of 11%.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/erajaya-swasembada-tbk-pt" target="_blank" data-smartkarma-citation="entities:18869:1" rel="noopener">Erajaya Swasembada (ERAA IJ)</a> had a tempestuous 3Q2023, with one-off write-downs of inventory in both Indonesia and Malaysia, despite booking strong sales and gross profit growth overall. </li>
<li>The company has also expanded its store network more aggressively in 9M2023, which meant higher opex and financing to build the new inventory, whilst stores take time to ramp up. </li>
<li>
<a href="https://www.smartkarma.com/entities/erajaya-swasembada-tbk-pt" target="_blank" data-smartkarma-citation="entities:18869:1" rel="noopener">Erajaya</a> should see a recovery in 4Q2023, given plans to limit store expansion plus a lack of write-offs. Trading on 5x FY2024E PER with forecast +25% EPS growth is attractive.</li>
</ul>



Erajaya Swasembada (ERAA IJ) had a tempestuous 3Q2023, with one-off write-downs of inventory in both Indonesia and Malaysia, despite booking strong sales and gross profit growth overall. 
The company has also expanded its store network more aggressively in 9M2023, which meant higher opex and financing to build the new inventory, whilst stores take time to ramp up. 

Erajaya should see a recovery in 4Q2023, given plans to limit store expansion plus a lack of write-offs. Trading on 5x FY2024E PER with forecast +25% EPS growth is attractive.


Erajaya Swasembada (ERAA IJ) - Coming Out a Squall

Vietnam

Mobile World Investment Corporation is a Vietnamese publicly listed retailer specializing in mobile devices, consumer electronics, and household appliances through its Thegioididong.com and Dien May Xanh chains. The company also operates the grocery chain Bach Hoa Xanh and An Khang pharmacies. Mobile World Investment Corporation was founded in 2004 and is headquartered in Thu Dau Mot, Vietnam.

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Mobile World (MWG VN)

Erajaya Swasembada (ERAA IJ) - Affordability Rocks

Erajaya Swasembada (ERAA IJ) booked a solid set of 1H2024 results driven by the availability of affordable handsets, with volumes driving growth...

Angus Mackintosh

MWG - On Track to Sales Recovery, yet a Bumpy Road for Full Profit Restoration

MWG recorded a significant decline in Q1/23 net revenue, plummeting by 26% YoY and 11% QoQ. NPAT-MI exhibited a drastic drop of 99% YoY, resulting...

Rong Viet Securities

Erajaya Swasembada (ERAA IJ) - Less New Stores with Higher Volumes

Erajaya will slow its store buildout this year as it focuses on productivity ny it is still expected to add 200 new stores in Indonesia. Valuation...

Angus Mackintosh

MWG - On Track to Sales Recovery, yet a Bumpy Road for Full Profit Restoration

MWG recorded a significant decline in Q1/23 net revenue, plummeting by 26% YoY and 11% QoQ. NPAT-MI exhibited a drastic drop of 99% YoY, resulting...

Rong Viet Securities

Erajaya Swasembada (ERAA IJ) - Coming Out a Squall

Erajaya should see a reovery in 4Q2023, given plans to limit store expansion plus a lack of write-offs. Trading on 5x FY2024E PER with forecast...

Angus Mackintosh

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