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

<ul>
<li>
<a href="https://www.smartkarma.com/entities/cocoaland-holdings-bhd" target="_blank" data-smartkarma-citation="entities:493:1" rel="noopener">Cocoaland Holdings (COLA MK)</a> announced a privatisation offer from <a href="https://www.smartkarma.com/entities/fraser-neave-holdings-bhd" target="_blank" data-smartkarma-citation="entities:7742:1" rel="noopener">Fraser &amp; Neave Holdings (FNH MK)</a> at RM1.50 per share, a 26.1% premium to the undisturbed price.</li>
<li>The key conditions are the headcount test and &lt;10% rejection from all disinterested shareholders. The shareholder (Leverage Success) with a blocking stake has provided an irrevocable.</li>
<li>The offer is attractive in comparison to long-term historical share prices and multiples. The Board must respond by no later than 5 pm on 17 June.</li>
</ul>



Cocoaland Holdings (COLA MK) announced a privatisation offer from Fraser &amp; Neave Holdings (FNH MK) at RM1.50 per share, a 26.1% premium to the undisturbed price.
The key conditions are the headcount test and &lt;10% rejection from all disinterested shareholders. The shareholder (Leverage Success) with a blocking stake has provided an irrevocable.
The offer is attractive in comparison to long-term historical share prices and multiples. The Board must respond by no later than 5 pm on 17 June.


Cocoaland’s RM1.50 Per Share Privatisation Offer from Fraser & Neave

Asian Insight Provider - Actionable ideas, CrossASEAN Research

Henry Soediarko

Asian Insight Provider - Actionable ideas

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>Malaysia's reopening play for the consumption sector is <a href="https://www.smartkarma.com/entities/heineken-malaysia-bhd" target="_blank" data-smartkarma-citation="entities:12647:1" rel="noopener">Heineken Malaysia Bhd (HEIM MK)</a> .</li>
<li>Q1 22 revenue has bounced back to Q4 19 level and higher than Q1 2019 by 33% before taking into account the potential upside since the reopening of the nightlife.</li>
<li>Compared to other consumer names in Malaysia such as Carlsberg Malaysia, British American Tobacco, Nestle (Malaysia), and QL Resources, Heineken Malaysia is trading at a discount.</li>
</ul>


Malaysia's reopening play for the consumption sector is Heineken Malaysia Bhd (HEIM MK) .
Q1 22 revenue has bounced back to Q4 19 level and higher than Q1 2019 by 33% before taking into account the potential upside since the reopening of the nightlife.
Compared to other consumer names in Malaysia such as Carlsberg Malaysia, British American Tobacco, Nestle (Malaysia), and QL Resources, Heineken Malaysia is trading at a discount.


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

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Index Rebalance

<ul>
<li>
<a href="https://www.smartkarma.com/entities/westports-holdings-bhd" target="_blank" data-smartkarma-citation="entities:3954:1" rel="noopener">Westports Holdings (WPRTS MK)</a> will replace <a href="https://www.smartkarma.com/entities/hap-seng-consolidated-bhd" target="_blank" data-smartkarma-citation="entities:13036:1" rel="noopener">Hap Seng Consolidated (HAP MK)</a> in the <a href="https://www.smartkarma.com/entities/kuala-lumpur-composite-index" target="_blank" data-smartkarma-citation="entities:22913:1" rel="noopener">Kuala Lumpur Composite Index (KLCI) (FBMKLCI INDEX)</a> after the close of trading on 17 December.</li>
<li>
<a href="https://www.smartkarma.com/entities/hap-seng-consolidated-bhd" target="_blank" data-smartkarma-citation="entities:13036:1" rel="noopener">Hap Seng Consolidated (HAP MK)</a> is a delete on liquidity and there will be over 5 days of ADV to sell. The impact on <a href="https://www.smartkarma.com/entities/westports-holdings-bhd" target="_blank" data-smartkarma-citation="entities:3954:1" rel="noopener">Westports Holdings (WPRTS MK)</a> is smaller.</li>
<li>
<a href="https://www.smartkarma.com/entities/hap-seng-consolidated-bhd" target="_blank" data-smartkarma-citation="entities:13036:1" rel="noopener">Hap Seng Consolidated (HAP MK)</a> could drop in the short term but underperformance vs its peers could provide a buying opportunity, especially close to implementation date.</li>
</ul>



Westports Holdings (WPRTS MK) will replace Hap Seng Consolidated (HAP MK) in the Kuala Lumpur Composite Index (KLCI) (FBMKLCI INDEX) after the close of trading on 17 December.

Hap Seng Consolidated (HAP MK) is a delete on liquidity and there will be over 5 days of ADV to sell. The impact on Westports Holdings (WPRTS MK) is smaller.

Hap Seng Consolidated (HAP MK) could drop in the short term but underperformance vs its peers could provide a buying opportunity, especially close to implementation date.


KLCI Index Rebalance: Westports Replaces Hap Seng

<p><a href="https://www.smartkarma.com/entities/sheng-siong-group-ltd" target="_blank" data-smartkarma-citation="entities:6824:1" rel="noopener">Sheng Siong (SSG SP)</a> has been the stocks to benefit from the COVID-19 induced lockdown as Singaporeans are allowed to WFH instead of WFO thus they do more grocery shopping and also stockpiled in case of the reduced food supply due to the longer than expected pandemic. The company has recorded a substantial and never-seen-before YoY revenue growth <em>(Q1: 30.7%, Q2: 75.8%, and Q3: 28.9%)</em>. </p>
<p>The tides seemed to have turned though:</p>
<ul>
<li>Singapore statistics bureau reported that the revenue increase from supermarkets and convenience stores has slowed down while F&amp;B sales have grown from SGD 397 million to SGD 629 million <em>QoQ</em>, reflecting the change in consumers' behavior to start going out again. </li>
</ul>
<p>Although its valuation has peaked in Q2, Sheng Siong's share price has not decreased by much thus it is the right time book profit as the large revenues growth is unlikely to sustain going forward. </p>
<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/171/873/original/image_38476675561605505587235.png?1605505587" class="editor-image img-responsive" data-smartkarma-image-id="171873"></figure>

Sheng Siong (SSG SP) has been the stocks to benefit from the COVID-19 induced lockdown as Singaporeans are allowed to WFH instead of WFO thus they do more grocery shopping and also stockpiled in case of the reduced food supply due to the longer than expected pandemic. The company has recorded a substantial and never-seen-before YoY revenue growth (Q1: 30.7%, Q2: 75.8%, and Q3: 28.9%). 
The tides seemed to have turned though:

Singapore statistics bureau reported that the revenue increase from supermarkets and convenience stores has slowed down while F&amp;B sales have grown from SGD 397 million to SGD 629 million QoQ, reflecting the change in consumers' behavior to start going out again. 

Although its valuation has peaked in Q2, Sheng Siong's share price has not decreased by much thus it is the right time book profit as the large revenues growth is unlikely to sustain going forward. 


Sheng Siong (SSG): Sustainable High Growth?

<div>
<a href="https://www.smartkarma.com/entities/ql-resources-bhd" target="_blank" data-smartkarma-citation="entities:11221:1" rel="noopener">Ql Resources (QLG MK) </a>share price outperformance in the past 3 years has made it to be one of the darlings of <a href="https://www.smartkarma.com/entities/kuala-lumpur-composite-index" target="_blank" data-smartkarma-citation="entities:22913:1" rel="noopener">Kuala Lumpur Composite Index (KLCI) (FBMKLCI INDEX)</a> outside of the glove names. The high expectations from investors have pushed the market valuation to reach 64x PER, a 65% premium to its Malaysian peer - <a href="https://www.smartkarma.com/entities/7-eleven-malaysia-holdings-bhd" target="_blank" data-smartkarma-citation="entities:3890:1" rel="noopener">7 eleven malaysia holdings (SEM MK)</a> although the latter has higher debt and sells various SKUs, unlike Family Mart that focuses on fresh food. </div>
<div></div>
<div>
<div>Assuming all 300 stores are opened and profitable, the company's forward PER is around 25-45x;  higher than the regional peers' average valuation at 24x; which likely to suggest investors who have made a decent return from holding <a href="https://www.smartkarma.com/entities/ql-resources-bhd" target="_blank" data-smartkarma-citation="entities:11221:1" rel="noopener">Ql Resources (QLG MK)</a> to book some profit. </div>
<div></div>
</div>


Ql Resources (QLG MK) share price outperformance in the past 3 years has made it to be one of the darlings of Kuala Lumpur Composite Index (KLCI) (FBMKLCI INDEX) outside of the glove names. The high expectations from investors have pushed the market valuation to reach 64x PER, a 65% premium to its Malaysian peer - 7 eleven malaysia holdings (SEM MK) although the latter has higher debt and sells various SKUs, unlike Family Mart that focuses on fresh food. 


Assuming all 300 stores are opened and profitable, the company's forward PER is around 25-45x;  higher than the regional peers' average valuation at 24x; which likely to suggest investors who have made a decent return from holding Ql Resources (QLG MK) to book some profit. 



Malaysia

QL Resources Berhad is an investment holding company. Through its subsidiaries, the Company manufactures and sells fishmeal, surimi, and surimi based products, distributes animal feed raw materials, animal health products, and layer farming, and cultivates oil palm and crude palm oil milling.

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Ql Resources (QLG MK)

Heineken Malaysia (HEIM): Brewing

Revenue bounced to pre-COVID level due to the management's expertise in navigating the difficult period during the lockdown, the company will...

Henry Soediarko

KLCI Index Rebalance: Westports Replaces Hap Seng

Westports Holdings will replace Hap Seng Consolidated in the KLCI at the December rebalance. HAP MK is a liquidity delete and passive trackers will...

Brian Freitas

Sheng Siong (SSG): Sustainable High Growth?

Singapore statistics reported that the revenue increase from supermarkets, CSs has slowed down while F&B sales have grown 60% QoQ, reflecting a...

Henry Soediarko

QL Resources (QL): Take Profit?

Assuming all 300 stores are opened and profitable, the company's forward PER is around 25-45x; higher than the regional peers' average valuation...

Henry Soediarko

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Cocoaland’s RM1.50 Per Share Privatisation Offer from Fraser & Neave

The offer is attractive in comparison to long-term historical share prices and multiples. At the last close, the gross spread to the offer price is...

Arun George

Heineken Malaysia (HEIM): Brewing

Revenue bounced to pre-COVID level due to the management's expertise in navigating the difficult period during the lockdown, the company will...

Henry Soediarko

KLCI Index Rebalance: Westports Replaces Hap Seng

Westports Holdings will replace Hap Seng Consolidated in the KLCI at the December rebalance. HAP MK is a liquidity delete and passive trackers will...

Brian Freitas

Sheng Siong (SSG): Sustainable High Growth?

Singapore statistics reported that the revenue increase from supermarkets, CSs has slowed down while F&B sales have grown 60% QoQ, reflecting a...

Henry Soediarko

QL Resources (QL): Take Profit?

Assuming all 300 stores are opened and profitable, the company's forward PER is around 25-45x; higher than the regional peers' average valuation...

Henry Soediarko