Independent Research, Turtles all the way down

Turtles all the way down

Independent Research

Writing short articles about mis-priced boring stocks around the world.

Equity Bottom-Up

<ul><li>First I sold my Berry Global (BERY) shares (mentioned here a few days ago ) and my opinion on the spin-off transaction went from being neutral to slightly positive to neutral to slightly negative.</li><li>Probably should have looked into it deeper, but I got a large backlog of stocks to look at right now.</li><li>So what I will do is I will wait until after the spin-off before entering a position. I will be away anyway when the spin off begins trading, so I will not have the option to sell it right away, which I also don’t like.</li></ul>

First I sold my Berry Global (BERY) shares (mentioned here a few days ago ) and my opinion on the spin-off transaction went from being neutral to slightly positive to neutral to slightly negative.Probably should have looked into it deeper, but I got a large backlog of stocks to look at right now.So what I will do is I will wait until after the spin-off before entering a position. I will be away anyway when the spin off begins trading, so I will not have the option to sell it right away, which I also don’t like.

External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

<ul><li>TK Group’s 1H24 revenue/net profit growth of 18%/46% is slightly ahead of its earlier positive profit alert of 40%+ YoY earnings growth.</li><li>The strong results were driven by CE/communications demand recovery, GPM expansion and prudent expense control.</li><li>We spoke with the mgmt. post earnings, and mgmt. reiterated a positive view on FY24/25E outlook, backed by demand recovery from CE customers, new client/order wins and margin improvement. </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.

TK Group’s 1H24 revenue/net profit growth of 18%/46% is slightly ahead of its earlier positive profit alert of 40%+ YoY earnings growth.The strong results were driven by CE/communications demand recovery, GPM expansion and prudent expense control.We spoke with the mgmt. post earnings, and mgmt. reiterated a positive view on FY24/25E outlook, backed by demand recovery from CE customers, new client/order wins and margin improvement. 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.

TK Group (2283 HK) - 1H24 Beat on Strong Margins

Asian Hedge Fund Manager, Long Short Equity, Macro

David Mudd

<ul>
<li>Low volatility investing has taken the mantle from Dividend yield as the top strategy during July</li>
<li><a href="https://www.smartkarma.com/entities/byd-electronic-international-co-ltd" target="_blank" data-smartkarma-citation="entities:1927:1" rel="noopener">BYD Electronics (285 HK)</a> and <a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd-d7b798e2-202d-4e01-9a1e-799e2ae8f0c7" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba Group Holding (9988 HK)</a> are rated BUYs as their businesses show improvement.  </li>
<li>
<a href="https://www.smartkarma.com/entities/kingdee-international-sftwr" target="_blank" data-smartkarma-citation="entities:37:1" rel="noopener">Kingdee International Software (268 HK)</a> is seeing a softening in its SME business, however there is  potential to gain market share from foreign ERP companies given the pledged government's policies.
</li>
</ul>


Low volatility investing has taken the mantle from Dividend yield as the top strategy during July
BYD Electronics (285 HK) and Alibaba Group Holding (9988 HK) are rated BUYs as their businesses show improvement.  

Kingdee International Software (268 HK) is seeing a softening in its SME business, however there is  potential to gain market share from foreign ERP companies given the pledged government's policies.



BUY/SELL/HOLD: Hong Kong Stock Updates (July 29)

<ul><li>TK Group announced a positive profit alert for 1H24 with 40%+ YoY earnings growth.</li><li>After speaking with TK’s mgmt., we reiterate our positive view on TK’s 2H24 outlook, driven by strong order pipelines, new client wins, and revenue/margin recovery across most segments.</li><li>Following challenging business environment in 2022 and 2023, we believe TK is on track to deliver 38%/19% YoY earnings growth in FY24/25E, backed by client demand recovery (e.g. Jabra, Polycom), new order ramp-up (e.g. Meta, SONOS, Dyson), utilization improvement and operating leverage. </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.

TK Group announced a positive profit alert for 1H24 with 40%+ YoY earnings growth.After speaking with TK’s mgmt., we reiterate our positive view on TK’s 2H24 outlook, driven by strong order pipelines, new client wins, and revenue/margin recovery across most segments.Following challenging business environment in 2022 and 2023, we believe TK is on track to deliver 38%/19% YoY earnings growth in FY24/25E, backed by client demand recovery (e.g. Jabra, Polycom), new order ramp-up (e.g. Meta, SONOS, Dyson), utilization improvement and operating leverage. 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.

TK Group (2283 HK) - Positive Profit Alert in 1H24E

<ul><li>We recently spoke with TK Group (TK)’s mgmt. post FY23 earnings, and mgmt. reiterated positive view on order restocking, new client wins, capacity ramp-up in Vietnam/Huizhou and business opportunities in automotive/ medical device/ecigarette.</li><li>Following a challenging 2023, we expect TK’s net profit to grow 38%/19% YoY in FY24/25E, backed by order wins from VR/e-cigarette/medical device, mobile &amp; wearable/communications business recovery, and continued operating efficiency improvement.</li><li>We adjusted TP to HK$2.79 based on same 8.2x FY24E P/E. Trading at 4.4x FY24E P/E with 10% yield, we think the stock offers attractive risk/reward. Maintain BUY.</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.

We recently spoke with TK Group (TK)’s mgmt. post FY23 earnings, and mgmt. reiterated positive view on order restocking, new client wins, capacity ramp-up in Vietnam/Huizhou and business opportunities in automotive/ medical device/ecigarette.Following a challenging 2023, we expect TK’s net profit to grow 38%/19% YoY in FY24/25E, backed by order wins from VR/e-cigarette/medical device, mobile &amp; wearable/communications business recovery, and continued operating efficiency improvement.We adjusted TP to HK$2.79 based on same 8.2x FY24E P/E. Trading at 4.4x FY24E P/E with 10% yield, we think the stock offers attractive risk/reward. Maintain BUY.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.

TK Group (2283 HK) - Positive on Business Recovery in FY24/25E

China

TK Group specializes in the design and manufacturing of injection molds and plastic components, serving diverse industries such as automotive, medical, consumer electronics, and smart home products. The company provides one-stop injection molding solutions. It was founded in 1983 and is headquartered in Shenzhen, China.

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TK Group (2283 HK)

Closing 5 ideas

First I sold my Berry Global (BERY) shares (mentioned here a few days ago ) and my opinion on the spin-off transaction went from being neutral to...

Turtles all the way down

TK Group (2283 HK) - 1H24 Beat on Strong Margins

We adjust TP to HK$2.82 based on the same 8.2x FY24E P/E. Trading at 5.2x FY24E P/E with 8% yield, we think the stock offers attractive risk...

CMB International

BUY/SELL/HOLD: Hong Kong Stock Updates (July 29)

Low volatility investing is performing well in July. BYD Electronics has seen better Apple related and NEV sales and Alibaba is increasing some...

David Mudd

TK Group (2283 HK) - Positive Profit Alert in 1H24E

After speaking with TK’s mgmt., we reiterate our positive view on TK’s 2H24 outlook, driven by strong order pipelines, new client wins, and revenue...

CMB International

TK Group (2283 HK) - Positive on Business Recovery in FY24/25E

We adjusted TP to HK$2.79 based on same 8.2x FY24E P/E. Trading at 4.4x FY24E P/E with 10% yield, we think the stock offers attractive risk/reward....

CMB International

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