Daily Brief Consumer: Chow Tai Fook Jewellery, SHEIN Global Holdings, Amos Food Group, Leong Guan Holdings, Surya Pertiwi, Nippon Flour Mills, Virtus Total Return Fund , C.T.I. Traffic Industries Co Ltd, First Trust High Income Long/S and more

• We compile our selection of companies across Japan, China & India based on bottom-up triggers in each company.
• This is a mid-quarter update on companies as most companies will be announcing their September quarter results in next 45 days.
• Based on these new results and guidance, we will update the list of top ideas accordingly.

• 1H26 results show a reported-vs-adjusted profit gap: headline net income +112% YoY vs. adjusted net income -55.6%, as fulfilment costs rise 6.3pp of revenue.
• Our 2 Sept ACCUMULATE call got the risk framework right — recap math, cost escalation, governance concentration — but wrong on price: float thesis, not fundamentals, was the miss.
• We maintain BULLISH but with a lower Fair Value of US$25bn/HK$45.4/share, based on FY26E Adj. EBIT US$950m x 11x EV/EBIT plus ~US$14.2bn net cash.

• Amos is positioned in the high growth “happiness + health” track, entering the creative/interactive candy and nutritional functional candy niche market that traditional candy giants have not yet focused on.
• Creative/Healthy candies market has certain characteristics. The product differentiation barriers are difficult to maintain a high valuation in long term. Amos’ current high growth may not have a safety buffer.
• In our view, a conservative valuation range could be 16-18x P/E. A neutral valuation range could be 19-22x P/E, and an optimistic valuation range could be 23-26x P/E.

• Over five sessions, 60 director interests and substantial shareholdings were filed, including 23 acquisitions and two disposals by directors/CEOs.
• Seatrium launched a new S$200 million Share Buyback Programme, funded from existing cash, doubling the previous programme.
• Alan Goh of Katrina Group sold 12.6 million shares, reducing his interest to 76.7%, with BYD By 1826 acquiring 5%.

• This is the sole agent of TOTO, a leading sanitary ware maker from Japan, in Indonesia.
• Business is a distribution business and earns steady Gross Profit Margins.
• Business is the number 1 player in Indonesia, earning steady gross margins, high ROE, and high net margins

• Q1 profitability was impacted by higher depreciation from the newly operational Chita Mill and cost inflation, exacerbated by the ongoing Middle East tensions, that outpaced pricing, but we believe the weakness is transitory rather than a change in the Company’s operating performance.
• Flour Milling continued to show underlying operating improvement and is tracking ahead of its full-year plan, while price revisions in the Food segment should drive a profitability recovery in H2. Importantly, SG&A growth decelerated versus FY3/26 as NIPPN executes on cost reduction measures, a sign of the efficiency discipline that drives medium- to long-term profitability improvements.
• Furthermore, NIPPN’s capital structure optimization continues to progress steadily, with further cross-shareholding disposals planned through the remainder of FY3/27.

• H1/Q2 results largely match tone of management guidance from the IPO process
• Revenue barely grew, and margins shrank due to higher Fulfilment costs (tied to oil)
• Shares are down over 27% from IPO; any break from fuel costs could boost bottom-line

• Hybrid Asset Allocation Mandate: Virtus Total Return Fund Inc. (ZTR US, Last Price: $6.04) operates as a diversified closed-end management investment company designed to deliver high total return through a dual-engine structure combining global infrastructure equities (subadvised by Duff & Phelps) and multi-sector credit strategies (subadvised by Newfleet Asset Management).
• Top-Tier Smartscore Profile vs. Cash Flow Moderation: The Fund achieves leading Smartkarma Smartscores in Value (5/5) and Growth (5/5), complemented by Dividend (4/5) and Momentum (4/5), driven by an attractive 9.93% market distribution yield and a robust 3-year EPS CAGR of 126.13%, balanced against multi-year distribution right-sizing (-14.50% 3-year dividend CAGR).
• Operational Performance & Leverage Sensitivity: Financial results highlight a sharp rebound from 2023 troughs, with 2025 net income reaching $43.61M on $51.49M in total investment income (84.70% net margin). However, structural regulatory leverage (~31.7%) and declining operating cash flow ($5.17M in 2025 vs. $14.83M in 2023) underscore sensitivity to interest rate cycles and non-cash unrealized portfolio marks.

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• Top-Line Expansion Overshadowed by Severe Margin Deterioration: CTI Traffic Industries recorded aggressive revenue growth to NT$2,025.20M in 2025 (3-year revenue CAGR of 58.94%), driven by product portfolio expansion and commercial trading activities. However, consolidated gross margin collapsed from 31.91% in 2023 to 6.05% in 2025 (turning negative at -2.26% in 1Q26), resulting in a net loss of NT$71.36M in 2025 and ongoing operational deficits through 1H26.
• Secular Headwinds in ICE Components Prompting Green Energy Pivot: As a legacy manufacturer of internal combustion engine (ICE) piston rings, valvetrains, and gaskets, CTI faces terminal demand displacement from global automotive electrification. The company is actively pivoting toward lithium-ion vehicle starter batteries (‘Super-Starttery’), portable jump starters, and energy storage systems (ESS), though these emerging segments have yet to reach the scale necessary to offset legacy margin pressures.
• Severe Free Cash Flow Burn Threatens Capital Returns: Operating cash flow deteriorated to -NT$350.78M and free cash flow plunged to -NT$420.47M in 2025 (3-year FCF CAGR of -120.22%) due to operating losses and heavy working capital requirements. While CTI distributed a dividend of NT$0.61 per share in 2026 (2.71% yield), ongoing cash burn presents significant uncertainty regarding future dividend sustainability and balance sheet headroom.

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• First Trust High Income Long/Short Fund (FSD US) is a closed-end management investment company designed to deliver high current income with secondary capital appreciation, utilizing an actively managed long/short portfolio of U.S. and international below-investment-grade corporate debt sub-advised by MacKay Shields LLC.
• Financial performance highlights significant sensitivity to credit spread movements and interest rate cycles, with net income recovering to $19.11 million in FY2023 from a mark-to-market contraction of -$78.36 million in FY2022, supported by durable operating cash flows of $19.81 million.
• FSD exhibits top-tier income credentials with a Smartkarma Dividend Smartscore of 5/5 and a stable distribution payout of $1.260 per share, though institutional investors must weigh the impact of structural leverage financing costs, sub-investment grade credit risk, and closed-end discount dynamics.

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