Independent research on the U.S. markets, Baptista Research

Baptista Research

Independent research on the U.S. markets

Baptista Research is an independent financial research house focused on the U.S. markets. We provide equity research as well as credit research reports on the top-listed U.S. companies with most of our focus on technology, consumer goods and services, automobiles, industrials, oil and gas, pharma, and healthcare. Our research has served more than 3000 institutional investors including mutual funds, hedge funds, banks, family offices, and various buy-side firms. We operate a research subscription service where institutions, as well as retail investors, can have priority access to all our research. We also have a wide distribution of our research reports across some of the top global financial platforms. Apart from equity research and credit research, we also provide advisory services with respect to mergers & acquisitions (M&A), private equity/ venture capital fundraising, valuation reports, and investment management services for corporates.
Baptista Research is owned and managed by Ishan Majumdar, an ex-Venture Capitalist/ Investment Banker, a Chartered Accountant, and a Masters’ degree holder in Management from HEC Paris. Ishan has nearly a decade of experience in Mergers and Acquisitions, Leveraged Buyouts (LBOs), Venture Capital Investing, Corporate Strategy, and Valuation in front-office roles at the likes of BNP Paribas CIB, Credit Agricole CIB, Groupe Danone, and TIW Private Equity. He has worked on and closed multiple acquisition deals, leveraged buyouts, and start-up investment transactions.

Equity Bottom-Up

<ul><li>TJX is off to a strong start to fiscal 2023 and delivered a better-than-anticipated top-line performance in the last quarter.</li><li>The company's better-than-expected US comp store sales increased, driven by an excellent performance at its Marmaxx division.</li><li>Internationally, its TJX International and TJX Canada divisions' performance was good.</li></ul>

TJX is off to a strong start to fiscal 2023 and delivered a better-than-anticipated top-line performance in the last quarter.The company's better-than-expected US comp store sales increased, driven by an excellent performance at its Marmaxx division.Internationally, its TJX International and TJX Canada divisions' performance was good.

<ul><li>This is our first report on TJX Companies is pleased with its third-quarter performance.</li><li>The company once more produced solid profitability and a fantastic merchandise margin.</li><li>We initiate coverage on the stock of The TJX Companies with a 'Hold' rating.</li></ul>

This is our first report on TJX Companies is pleased with its third-quarter performance.The company once more produced solid profitability and a fantastic merchandise margin.We initiate coverage on the stock of The TJX Companies with a 'Hold' rating.

The TJX Companies Inc.: Initiation of Coverage – Recent Macro & Key Drivers

Global Emerging Market Equities, Propitious Research

Wium Malan, CFA

Global Emerging Market Equities

Independent, Fundamental Quantitative Research

Propitious Research

Fully independent, fundamental and quantitative equity research, focused on companies in the Telecommunication, Media, Technology, Internet and Healthcare sectors in the Global Emerging Markets. Idea generation focused on Quality stocks, trading below their intrinsic Value, with sound Corporate Governance.

<p><a href="https://www.smartkarma.com/entities/vipshop-holdings-ltd-adr" target="_blank" data-smartkarma-citation="entities:1088:1" rel="noopener">Vipshop Holdings (VIPS US)</a> has had an exceptionally volatile 12 months of trading. Following a &gt;200% share price surge between October 2020 and March 2021, the share price has corrected 77%, wiping out nearly $24bn in market value. The significant sell-off, coupled with less severe earnings expectation downgrades (-18%) from the sell-side, has resulted in Vipshop de-rating from a peak forward PE ratio of 25.3x to only 6.9x, which is the cheapest the stock has ever been. </p>
<p>In this insight, we take a closer look at the meaningful market events which have driven the sell-off in Vipshop as well as the short- and longer-term earnings outlook for the company. </p>
<p>Going into their 3Q21 reporting period, Vipshop is facing an exceptionally high growth base set in the comparative period as well as macro-economic headwinds due to a slowing Chinese economy and retail spending, which could result in the continuation of the earnings downgrade cycle over the short- to medium-term. However, trading on an estimated 5.3x ex-cash forward PE ratio likely implies that the buy-side has factored most of this in and we are nearing the point of peak pessimism.</p>

Vipshop Holdings (VIPS US) has had an exceptionally volatile 12 months of trading. Following a &gt;200% share price surge between October 2020 and March 2021, the share price has corrected 77%, wiping out nearly $24bn in market value. The significant sell-off, coupled with less severe earnings expectation downgrades (-18%) from the sell-side, has resulted in Vipshop de-rating from a peak forward PE ratio of 25.3x to only 6.9x, which is the cheapest the stock has ever been. 
In this insight, we take a closer look at the meaningful market events which have driven the sell-off in Vipshop as well as the short- and longer-term earnings outlook for the company. 
Going into their 3Q21 reporting period, Vipshop is facing an exceptionally high growth base set in the comparative period as well as macro-economic headwinds due to a slowing Chinese economy and retail spending, which could result in the continuation of the earnings downgrade cycle over the short- to medium-term. However, trading on an estimated 5.3x ex-cash forward PE ratio likely implies that the buy-side has factored most of this in and we are nearing the point of peak pessimism.

<p>The Chinese eCommerce sector has been affected by increased regulatory scrutiny from the State Administration for Market Regulation (SAMR) which has been a headwind to most companies in the sector. However, during this time, <a href="https://www.smartkarma.com/entities/vipshop-holdings-ltd-adr" target="_blank" data-smartkarma-citation="entities:1088:1" rel="noopener">Vipshop Holdings (VIPS US)</a> has meaningfully outperformed peers, driven by an acceleration in active user numbers. <a href="https://www.smartkarma.com/entities/alibaba-group" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba Group (9988 HK)</a>, in turn, has significantly underperformed peers, driven by an overhaul of regulation affecting, not only, its 33%-owned <a href="https://www.smartkarma.com/entities/ant-group-co-ltd" target="_blank" data-smartkarma-citation="entities:24240:1" rel="noopener">Ant Financial Services Group (6688 HK)</a>, but also its core Chinese marketplace operations. </p><p>Having previously explored the prospects for Alibaba Group in more detail (<a href="https://www.smartkarma.com/insights/alibaba-a-detailed-look-at-the-sotp-and-what-that-tells-us-about-the-ant-group-and-core-commerce" target="_blank" data-smartkarma-citation="insights:47981" rel="noopener">Alibaba: A Detailed Look at the SOTP, and What that Tells Us About the Ant Group and Core Commerce</a> ), in this insight, I take a closer look at the comparative valuations between Chinese niche apparel flash sales company, Vipshop Holdings, and Chinese marketplace behemoth, Alibaba Group, as it relates to their regulatory challenges, competitive positioning, and medium-term growth outlook.</p>

The Chinese eCommerce sector has been affected by increased regulatory scrutiny from the State Administration for Market Regulation (SAMR) which has been a headwind to most companies in the sector. However, during this time, Vipshop Holdings (VIPS US) has meaningfully outperformed peers, driven by an acceleration in active user numbers. Alibaba Group (9988 HK), in turn, has significantly underperformed peers, driven by an overhaul of regulation affecting, not only, its 33%-owned Ant Financial Services Group (6688 HK), but also its core Chinese marketplace operations. Having previously explored the prospects for Alibaba Group in more detail (Alibaba: A Detailed Look at the SOTP, and What that Tells Us About the Ant Group and Core Commerce ), in this insight, I take a closer look at the comparative valuations between Chinese niche apparel flash sales company, Vipshop Holdings, and Chinese marketplace behemoth, Alibaba Group, as it relates to their regulatory challenges, competitive positioning, and medium-term growth outlook.

Long/Short: Alibaba/Vipshop, a Comparative Valuation

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

<p><a href="https://www.smartkarma.com/entities/miniso-group-holdings" target="_blank" data-smartkarma-citation="entities:29673:1" rel="noopener">MINISO Group Holdings (MNSO US)</a> is the largest global branded variety retailer of lifestyle products, with a 5.2% market share of the GMV of the global branded variety retail market in 2019, according to Frost &amp; Sullivan. Miniso has launched its IPO at a price range of $16.50-18.50 per ADS. At the mid-point of the IPO price range, Miniso will raise net proceeds of $504.2 million. </p><div><div><div class="content-highlight"><p>In <a href="https://www.smartkarma.com/insights/miniso-group-ipo-initiation-chain-reaction" target="_blank" rel="noopener">our initiation note</a>, we stated that setting aside the short-term negative impact due to COVID-19, Miniso presents a unique opportunity to gain exposure to the global branded variety retail market which is driven by consumers’ increasing focus on product design and value for money. We opined that Miniso’s fundamentals offer more positives than negatives. Overall, our valuation analysis suggests that the IPO price range is attractive.</p></div></div></div>

MINISO Group Holdings (MNSO US) is the largest global branded variety retailer of lifestyle products, with a 5.2% market share of the GMV of the global branded variety retail market in 2019, according to Frost &amp; Sullivan. Miniso has launched its IPO at a price range of $16.50-18.50 per ADS. At the mid-point of the IPO price range, Miniso will raise net proceeds of $504.2 million. In our initiation note, we stated that setting aside the short-term negative impact due to COVID-19, Miniso presents a unique opportunity to gain exposure to the global branded variety retail market which is driven by consumers’ increasing focus on product design and value for money. We opined that Miniso’s fundamentals offer more positives than negatives. Overall, our valuation analysis suggests that the IPO price range is attractive.

United States

The TJX Companies, Inc. is an off-price apparel and home fashion retailer in the United States and worldwide.  The Company operates off-price retail concepts in the U.S., Canada and Europe that offer a wide range of brand name and designer merchandise.

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Tjx Companies (TJX US)

The TJX Companies Inc.: Major Drivers

TJX is off to a strong start to fiscal 2023 and delivered a better-than-anticipated top-line performance in the last quarter. The company's...

Baptista Research

The TJX Companies Inc.: Initiation of Coverage – Recent Macro & Key Drivers

This is our first report on TJX Companies is pleased with its third-quarter performance. The company once more produced solid profitability and a...

Baptista Research

Vipshop: Cheapest It Has Ever Been

In this insight, we take a closer look at the meaningful market events which have driven the sell-off in Vipshop as well as the short- and longer...

Wium Malan, CFA

Long/Short: Alibaba/Vipshop, a Comparative Valuation

In this insight, I take a closer look at the comparative valuations between Chinese niche apparel flash sales company, Vipshop Holdings, and...

Wium Malan, CFA

MINISO Group IPO: Valuation Insights

MINISO Group Holdings (MNSO US) is the largest global branded variety retailer of lifestyle products, with a 5.2% market share of the GMV of the...

Arun George

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