Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>On the 29th December 2023, <a href="https://www.smartkarma.com/entities/kerry-logistics-network-ltd" target="_blank" data-smartkarma-citation="entities:367:1" rel="noopener">Kerry Logistics Network (636 HK)</a> (KLN) announced it would in-specie its entire 52.1% stake in <a href="https://www.smartkarma.com/entities/kerry-express-thailand" target="_blank" data-smartkarma-citation="entities:29253:1" rel="noopener">Kerry Express Thailand (KEX TB)</a>.</li>
<li>Given <a href="https://www.smartkarma.com/entities/maanshan-dingtai-rare-a" target="_blank" data-smartkarma-citation="entities:4128:1" rel="noopener">S.F. Holding (002352 CH)</a> holds a 51.5% stake in KLN, it will hold 26.8% in KET post-in-specie, triggering an unconditional MTO. The MTO price will be THB5.50/share. </li>
<li>Thai SFC approval has now been <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2024/0205/2024020501935.pdf" target="_blank" rel="noopener">satisfied</a>.  The MTO should commence around the 13th Feb. with payment ~26th March. KLN, cum-entitlement to KEX, is the 19 Feb.</li>
</ul>


On the 29th December 2023, Kerry Logistics Network (636 HK) (KLN) announced it would in-specie its entire 52.1% stake in Kerry Express Thailand (KEX TB).
Given S.F. Holding (002352 CH) holds a 51.5% stake in KLN, it will hold 26.8% in KET post-in-specie, triggering an unconditional MTO. The MTO price will be THB5.50/share. 
Thai SFC approval has now been satisfied.  The MTO should commence around the 13th Feb. with payment ~26th March. KLN, cum-entitlement to KEX, is the 19 Feb.


<ul>
<li>Last week <a href="https://www.smartkarma.com/entities/kerry-logistics-network-ltd" target="_blank" data-smartkarma-citation="entities:367:1" rel="noopener">Kerry Logistics Network (636 HK)</a> (KLN) <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2023/1229/2023122900152.pdf" target="_blank" rel="noopener">announced</a> it would in-specie its entire 52.1% stake in <a href="https://www.smartkarma.com/entities/kerry-express-thailand" target="_blank" data-smartkarma-citation="entities:29253:1" rel="noopener">Kerry Express Thailand (KEX TB)</a> (KET).</li>
<li>As <a href="https://www.smartkarma.com/entities/maanshan-dingtai-rare-a" target="_blank" data-smartkarma-citation="entities:4128:1" rel="noopener">S.F. Holding (002352 CH)</a> holds a controlling 51.5% stake in KLN after the 2021 partial Offer, it will hold 26.8% in KET post-in-specie. That triggers an unconditional MTO.  </li>
<li>The MTO price will be THB5.50/share. The key regulatory approval is Thai SFC. That won't be an issue. </li>
</ul>


Last week Kerry Logistics Network (636 HK) (KLN) announced it would in-specie its entire 52.1% stake in Kerry Express Thailand (KEX TB) (KET).
As S.F. Holding (002352 CH) holds a controlling 51.5% stake in KLN after the 2021 partial Offer, it will hold 26.8% in KET post-in-specie. That triggers an unconditional MTO.  
The MTO price will be THB5.50/share. The key regulatory approval is Thai SFC. That won't be an issue. 


Kerry Express (KEX TB): Kerry Logistics (636 HK)'s In-Specie Triggers MTO

Thai Equity - Bottom-up - Equities, Pi Securities PCL, Thailand

Pi Research

Thai Equity - Bottom-up - Equities

Leading, full-service investment firm in Thailand

Pi Securities PCL, Thailand

Pi Securities is a well known securities company with 40 years experience in the industry, serving more than 60,000 clients. We offer one - stop service providing full range of financial products and services including extensive Brokerage, Proprietary Trading (Equities and Bonds), Advisory Services, Structured Products.

Moreover, our new research team tailored for institutional clients to focus on mid to small cap of Thai equities and trading strategies. Our services offered to our premium clients also include arrangement of company or site visits to with the managements of Thai listed companies.

Note: Effective on 1 March 2022, Country Group Securities PCL changed its name to Pi Securities

Equity Bottom-Up

<ul>
<li>VGI reports Bt68m net profit in FY2Q23(July’22-Sept’22).Stripping out extra items mainly from sales of investment,loss from core operation would be at Bt147m,the most disappointed loss in the past six quarters.</li>
<li>Disappointed earnings result in 2QFY23 Six-quarter high of VGI’s loss pressured by;1.) a spike in operating costs from digital service segment mainly from an insurance arm under ‘Rabbit Care’ together</li>
<li>Revenue hit eleven quarter high at Bt1.2bn (+33%YoY +18%QoQ), underpinned by revenue from digital service that hit all-time high at Bt381m. (+47%QoQ +40%YoY) mostly from insurance commission</li>
</ul>


VGI reports Bt68m net profit in FY2Q23(July’22-Sept’22).Stripping out extra items mainly from sales of investment,loss from core operation would be at Bt147m,the most disappointed loss in the past six quarters.
Disappointed earnings result in 2QFY23 Six-quarter high of VGI’s loss pressured by;1.) a spike in operating costs from digital service segment mainly from an insurance arm under ‘Rabbit Care’ together
Revenue hit eleven quarter high at Bt1.2bn (+33%YoY +18%QoQ), underpinned by revenue from digital service that hit all-time high at Bt381m. (+47%QoQ +40%YoY) mostly from insurance commission


VGI : On Slow Recovery Pace Relative to Peers at Demanding Valuation

<ul>
<li>We downgrade VGI to HOLD rating while trim down target price to Bt4.60(previous TP:Bt6.20)after revise down earnings in 22-23E by 57%and 24% and factor in target price cut for KEX</li>
<li>Disappointed earnings result in 1QFY23 Five-quarter low of VGI’s core profit was dragged down by;1) share of loss from associates that fell to Bt101m (vs.Bt90m in 4QFY22), mainly from KEX </li>
<li>An extra gain from share divestment that boost net profit include Bt113m from JMART and Bt59m from KEX.</li>
</ul>


We downgrade VGI to HOLD rating while trim down target price to Bt4.60(previous TP:Bt6.20)after revise down earnings in 22-23E by 57%and 24% and factor in target price cut for KEX
Disappointed earnings result in 1QFY23 Five-quarter low of VGI’s core profit was dragged down by;1) share of loss from associates that fell to Bt101m (vs.Bt90m in 4QFY22), mainly from KEX 
An extra gain from share divestment that boost net profit include Bt113m from JMART and Bt59m from KEX.


VGI : Still in Recovery Path but at a Sluggish Pace Against Peers

<ul>
<li>We maintain BUY rating for VGI with the new target price of Bt6.20 (Previous TP: Bt6.50), derived from SOTP method or 50% premium to Thai media peers.  </li>
<li>We anticipate revenue streams from media and commercial space (recently started to manage by NINE),to retreat to 70% of the level we have seen during pre-pandemic by late 2QFY23 (July’22-September’22)</li>
<li>The management revenue target in FY2023 at Bt6.5bn-7.0bn is fairly optimistic as we anticipate OOH media revenue to not recover that quickly.</li>
</ul>


We maintain BUY rating for VGI with the new target price of Bt6.20 (Previous TP: Bt6.50), derived from SOTP method or 50% premium to Thai media peers.  
We anticipate revenue streams from media and commercial space (recently started to manage by NINE),to retreat to 70% of the level we have seen during pre-pandemic by late 2QFY23 (July’22-September’22)
The management revenue target in FY2023 at Bt6.5bn-7.0bn is fairly optimistic as we anticipate OOH media revenue to not recover that quickly.


VGI: Moderate Earnings Recovery with Growth Remain Promising

Thailand

VGI Public Company Limited operates as an advertising media company. The Company offers out of home advertising, campaign measurement, target advertising campaign, and offline-to-online solutions. VGI serves customers globally.

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VGI PCL (VGI TB)

Kerry Express (KEX TB)'s MTO Update

KLN is inexpensive at a trailing 3.2x PER for its stub ops - ex-KET. The five-year average is 6.7x (incl KET). KLN is up 15% since the in-specie...

David Blennerhassett

Kerry Express (KEX TB): Kerry Logistics (636 HK)'s In-Specie Triggers MTO

KET is trading 2% through term. Get involved if this were to dip below the net terms. Or buy outright is you have a firm conviction on the back...

David Blennerhassett

VGI : On Slow Recovery Pace Relative to Peers at Demanding Valuation

VGI reports Bt68m net profit in FY2Q23 (July’22-Sept’22). Stripping out extra items mainly from sales of investment, loss from core operation would...

Pi Securities PCL, Thailand

VGI : Still in Recovery Path but at a Sluggish Pace Against Peers

We downgrade VGI to HOLD rating while trim down target price to Bt4.60 (previous TP: Bt6.20) after revise down earnings in 22-23E by 57% and 24%...

Pi Securities PCL, Thailand

VGI: Moderate Earnings Recovery with Growth Remain Promising

We maintain BUY rating for VGI with the new target price of Bt6.20 (Previous TP: Bt6.50), derived from SOTP method or 50% premium to Thai media...

Pi Securities PCL, Thailand

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