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

<ul>
<li>
<a href="https://www.smartkarma.com/entities/oriental-watch-holdings" target="_blank" data-smartkarma-citation="entities:19950:1" rel="noopener">Oriental Watch (398 HK)</a> delivered a resilient result with revenue/profits -5%/-20% YoY (ex-one offs -11.5% YoY), despite weakness in HK (22% of sales), where the company is now making losses. </li>
<li>Cash &amp; Investments dipped to 901 mn HKD, representing about 54% of the market capitalization. The company declared a 16.7 HKD cent/dividend (FY25: 41.3 HKD/cent yield 12%). </li>
<li>We believe that FY26 will be a year of consolidation, and with a weak HK, profits will remain subdued. Stock trades at 8.4x FY25 with a 12% dividend yield. </li>
</ul>



Oriental Watch (398 HK) delivered a resilient result with revenue/profits -5%/-20% YoY (ex-one offs -11.5% YoY), despite weakness in HK (22% of sales), where the company is now making losses. 
Cash &amp; Investments dipped to 901 mn HKD, representing about 54% of the market capitalization. The company declared a 16.7 HKD cent/dividend (FY25: 41.3 HKD/cent yield 12%). 
We believe that FY26 will be a year of consolidation, and with a weak HK, profits will remain subdued. Stock trades at 8.4x FY25 with a 12% dividend yield. 


Oriental Watch (398 HK): Resilient Despite Tough HK Environment, Dividend A Slight Disappointment

<ul>
<li>
<a href="https://www.smartkarma.com/entities/oriental-watch-holdings" target="_blank" data-smartkarma-citation="entities:19950:1" rel="noopener">Oriental Watch (398 HK)</a> is navigating a challenging demand environment with Watch &amp; Jewelry sales in HK subdued at -21% YoY for Jan-Feb 2025, according to the Department of Statistics.</li>
<li>The bright spot is that China sales continue to hold up and account for more than 73% of the company's sales. Fortunately, Rolex could also increase its allocation to China.</li>
<li>We expect a 15%-20% YoY drop in FY25 profits. A 100% payout results in a 12.0% dividend yield, and 65% of the market capitalization is in cash. </li>
</ul>



Oriental Watch (398 HK) is navigating a challenging demand environment with Watch &amp; Jewelry sales in HK subdued at -21% YoY for Jan-Feb 2025, according to the Department of Statistics.
The bright spot is that China sales continue to hold up and account for more than 73% of the company's sales. Fortunately, Rolex could also increase its allocation to China.
We expect a 15%-20% YoY drop in FY25 profits. A 100% payout results in a 12.0% dividend yield, and 65% of the market capitalization is in cash. 


Oriental Watch (398 HK): Navigating a Tough Demand Environment With 65% of Market Cap in Cash

<ul>
<li>
<a href="https://www.smartkarma.com/entities/oriental-watch-holdings" target="_blank" data-smartkarma-citation="entities:19950:1" rel="noopener">Oriental Watch (398 HK)</a> went ex-dividend on the 4th of October. The stock gapped down more than what it paid out and now trades at 6x trailing PE.  </li>
<li>Cash at 1.1 bn HKD is greater than 50% of market capitalization, with a high trailing dividend yield of 16.2% and a rich history of paying chunky dividends. </li>
<li>We monitor the sales environment for HK/China, which shows a reasonably good pick-up in HK but lackluster for China.</li>
</ul>



Oriental Watch (398 HK) went ex-dividend on the 4th of October. The stock gapped down more than what it paid out and now trades at 6x trailing PE.  
Cash at 1.1 bn HKD is greater than 50% of market capitalization, with a high trailing dividend yield of 16.2% and a rich history of paying chunky dividends. 
We monitor the sales environment for HK/China, which shows a reasonably good pick-up in HK but lackluster for China.


Oriental Watch: Gone Ex-Dividend, Higher Yield, But Sales Softening in The Short-Term

<ul>
<li>Rolex acquisition of Bucherer signals the company's intention to own retail distribution and gain access to what its competitors are doing, with the battleground currently being Europe.</li>
<li>We believe it will take years for Rolex to digest this acquisition before foraying into other markets, but with a similar approach, potentially making <a href="https://www.smartkarma.com/entities/oriental-watch-holdings" target="_blank" data-smartkarma-citation="entities:19950:1" rel="noopener">Oriental Watch (398 HK) </a>a target.  </li>
<li>Trading at 6.9x PE with 50% of the market cap in cash and a ~15% dividend yield, the company presents a great investment opportunity. </li>
</ul>


Rolex acquisition of Bucherer signals the company's intention to own retail distribution and gain access to what its competitors are doing, with the battleground currently being Europe.
We believe it will take years for Rolex to digest this acquisition before foraying into other markets, but with a similar approach, potentially making Oriental Watch (398 HK) a target.  
Trading at 6.9x PE with 50% of the market cap in cash and a ~15% dividend yield, the company presents a great investment opportunity. 


Oriental Watch: Addressing the Rolex Acquisition of Bucherer

Value Investing in Asia, Oriental Value

Oriental Value

Value Investing in Asia

<ul><li>Oriental Watch is a prominent luxury watch retailer in the Greater China region.</li><li>While the company offers various brands, the majority of its sales, over 80%, come from its core brands, particularly Rolex and Tudor, a sister brand of Rolex.</li><li>Over the past two years, Oriental Watch has benefited greatly from the strong popularity of Rolex watches and has rewarded its shareholders with a dividend payout of over 100%.</li></ul>

Oriental Watch is a prominent luxury watch retailer in the Greater China region.While the company offers various brands, the majority of its sales, over 80%, come from its core brands, particularly Rolex and Tudor, a sister brand of Rolex.Over the past two years, Oriental Watch has benefited greatly from the strong popularity of Rolex watches and has rewarded its shareholders with a dividend payout of over 100%.

Hong Kong

Oriental Watch Holdings Limited, through its subsidiaries, trades watches and invests in properties.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Oriental Watch (398 HK)