Daily Brief Consumer: Kadoya Sesame Mills, Arclands Corporation, Hi Lex Corp, Oatside, Raymond, Laopu Gold, DFI Retail Group, Premier Investments and more

• I summarise the latest spreads and newsflow for the merger arb situations covered across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, the Philippines, Thailand, and Chinese ADRs.
• Highest spreads: Skyworth (751 HK), OFX Group (OFX AU), Z Fin (1168 HK), Peet Ltd (PPC AU), Atlantic Lithium (A11 AU), Tourism Holdings (THL NZ). 
• Lowest spreads: Kadoya Sesame Mills (2612 JP), Kakaku.com Inc (2371 JP), Accent Group (AX1 AU), Leopalace21 Corp (8848 JP), Taiyo Holdings (4626 JP), FleetPartners Group (FPR AU).

• The Arclands Corporation (9842 JP)/Joyful Honda (3191 JP) merger stalled after overstated profits. The restatement cuts FY2/26 net income by JPY1.3bn, with revised financials due 13 October.
• Case for keeping the ratio unchanged: Arclands’ core retail business is healthy, while Joyful Honda’s standalone outlook is deteriorating. The restated fundamentals suggest that Joyful Honda’s terms remain defensible.
• There are also factors supporting a change in the ratio. The likely outcome is Joyful securing a small (~5%) increase in its ratio, with concessions such as additional board seats.

• The TOPIX Index – Japan’s premier domestic equity index – will undergo a sea change in methodology at the end of this month, with ~760 names affected. 
• There will be roughly 35 or so ADDs, about 700 DELETEs (phased out over 8 quarters), and 40+ Liquidity Factor Removals. There will also be hundreds of FFW changes. 
• The likely ADDs have handily outperformed their peers over the past year, but some of that has been tech and idiosyncratic circumstances. There may still be trades to do.

Executive Summary

• Vertically Integrated Regional Challenger: Oatside operates as a premium plant-based beverage brand that has scaled its oat milk portfolio across 19 international markets and, in March 2026, extended into soya milk in Singapore and Malaysia under the Nobo brand. The company differentiates itself through a full-stack manufacturing model, utilising proprietary extraction technology at its owned facility in Bandung, Indonesia, to cater specifically to Asian taste profiles.
• High-Velocity Revenue Scaling: The business demonstrates strong commercial traction, with operating revenue nearly doubling year-on-year to reach US$74.9m in FY24 and expanding further to US$113.2m in FY25. This top-line expansion is supported by a top-tier institutional investor base that has provided at least US$171.9m across six disclosed primary transactions, with a reported implied post-money valuation of US$704.7m following its August 2025 preference share issue.
• Supply Chain Vulnerability: The company relies on the cross-border importation of specific raw materials, including Canadian soya beans and Australian oats, to supply its centralised manufacturing facility in Bandung, Indonesia. Any disruption to these international agricultural supply chains or a prolonged mechanical failure at this single production site would trigger immediate stockouts across its 19 active markets.

• Aerospace & Defence revenue rose 40.4% YoY to INR 123 crore in Q1 FY27, versus 26% growth in FY26.
• The aerospace business is a materially higher-margin activity than Raymond’s precision technology and auto-components vertical. 
• Raymond should increasingly be analysed as a precision-manufacturing platform rather than through its legacy conglomerate identity. 

• Share price has been punished, as there have been plenty pre-IPO investors who took profit, although operating numbers are actually doing quite well. 
• Laopu Gold (6181 HK) is different from Chow Tai Fook Jewellery (1929 HK), as the former is more of a global luxury house than a goldsmith.
• At 7x PER and a 10% dividend yield, combined with the calming down of the sellers’ volume, Laopu Gold (6181 HK) may actually offer a value. 

• DFI Retail Group (DFI SP) has completed a pivotal operational turnaround, swinging from a net loss of USD 244.5m in FY2024 to a net profit of USD 234.7m in FY2025, underpinned by gross margin expansion to 36.46% and disciplined cost rationalization across core formats.
• Cash flow generation remains exceptionally robust, with FY2025 operating cash flows of USD 1,099.2m and free cash flows of USD 986.1m supporting an attractive dividend yield of 4.52% and significant multi-year dividend growth.
• While high-margin Health & Beauty (Mannings, Guardian) and Convenience (7-Eleven) store formats continue to drive core earnings resilience, top-line grocery expansion faces ongoing macroeconomic headwinds, including cross-border consumption shifts in Hong Kong and intense regional competition.

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• Oatside has established itself as one of Asia’s fastest-growing plant-based dairy brands, expanding across 19 markets and scaling revenue from US$41.4m in FY23 to US$113.2m in FY25, reaching pre-tax profitability.
• The company’s core strategic differentiator is its vertically integrated, full-stack manufacturing facility in Bandung, Indonesia, which drives supply chain control, custom flavor formulations tailored to Asian palates, and long-term margin expansion potential.
• Near-term institutional focus centers on navigating supply chain bottlenecks, achieving positive operating cash flow, institutionalizing executive bench strength following the lack of a designated COO, and successfully executing brand line extensions such as Nobo Soy.

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• Shares in Premier Investments rallied after a better-than-expected start to FY27, but a lasting recovery rests on Smiggle winning back customers.
• Premier Investments’ early FY27 trading update well-received Smiggle tries to win back 9-12 year old customers Cash and investments support potential acquisitions Management notes scope for further capital returns