Consumer

• There could be one constituent change each for the NZX10 Index and the NZX50 Index/ NZX50 Portfolio Index in March.
• The flows are limited but the impacts are huge, and the stocks could move ahead of the announcement of the changes.
• A2 Milk Co Ltd (ATM NZ) is a potential inclusion to the NZX10 Index, but the inflows will be completely overshadowed by the potential deletion from a global index.

• With the review period now complete, there could be 7 changes (including 2 migrations) for the NSE Nifty Next 50 Index (NIFTYJR INDEX) in March.
• Bajaj Housing Finance (BHF IN) and Swiggy (SWIGGY IN) are a hair’s breadth apart on market cap and only one of them could be added to the index.
• With quantitative criteria now being used to add stocks to the F&O segment, it is possible there is no change to the index methodology to limit inclusion to F&O members.

• The HSCEI serves as a benchmark to reflect the overall performance of the top 50 “Mainland China” securities listed in Hong Kong.
• The official index changes and indicative weights for the March 2025 index rebal event will be announced on Friday 21st February 2025.
• We continue to expect one change for the HSCEI index in March 2025.

• Guming Holdings (1364 HK) is forecasted to initially fail the fcap threshold for both global indices due to an IPO free float of ~6%.
• The security is expected to be added at the global index’s March 2026 review as the lock-up expiry’s fcap increase becomes effective post September 2025 cut-off date.
• The security will be eligible for the other global index at the May 2026 review following the 12-month lock-up expiry of the undisclosed shareholders.

• Mixue Group is looking to raise about US$1bn in its upcoming Hong Kong IPO.
• MIXUE Group (MIXUE) is a freshly-made drinks company providing affordable products to consumers, including freshly-made fruit drinks, tea, ice cream and coffee, typically priced at around one USD per item.
• In our earlier notes, we have looked at the past performance, undertaken a peer comparison and spoken about valuations. In this note, we talk about updates from its recent filings.

• Fosun Tourism (1992 HK)’s IFA opines that the share buyback privatisation offer of HK$7.80 is fair and reasonable. The vote is on 4 March. 
• The key condition is the scheme be approved by at least 75% of disinterested shareholders (rejection by <10% of disinterested shareholders). No disinterested shareholder holds a blocking stake.
• Despite disclosing a potential REIT listing, there are no signs of dissent. At the last close, the gross/annualised spread for a 26 March payment was 3.5%/30.2%.

• Borosil Renewables (BRSL IN) is India’s largest solar glass manufacturer having c apacity of 1000TPD in India and 350TPD in Germany. 
• With the rising demand and government anti-dumping duty support company is increasing 50% capacity in India to 1500TPD in the upcoming 18 Months. 
• Company also raised INR 700Crs of funds via preferential, 100Crs via equity from promoter and 600Crs via warrants from HNIs and family offices for capex and loan repayment.

• Investors want to see if management can be entrusted with strategies to increase certainty of achieving plans, to build foundations for growth to expand corporate value, and to manage company.
• The problem is that the disclosed contents of the mid-term management plan do not include necessary information, or the goals themselves are not what investors are looking for.
• Before disclosing medium-term management plans, companies should estimate how much return on capital can be achieved by the plan and how much the corporate value and stock price will be.

• Columbia Sportswear Company’s fourth quarter and full-year financial performance for 2024 presented a mixed picture rooted in market dynamics and strategic initiatives.
• On the earnings call, the company leadership, including CEO Tim Boyle, highlighted achievements in inventory management, cost savings, and international market growth, while acknowledging challenges faced in North American market conditions.
• Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology.

• We present our outlook for Taste Gourmet’s (8371 HK) FY25 earnings, which will be announced in mid-June. We estimate revenue growth of 21% and net profit growth of 13%.
• The mainboard listing catalyst is still in play with the company at the query stage with the SFC Taste Gourmet (8371 HK): GEM to Mainboard Listing Catalyst in Play.
• Based on our earnings preview, the stock trades at 5.5x FY25PE, 2x EV-EBITDA, with 35% of the market cap in cash and a 10% dividend yield. 

• In the past month we have seen Seven & I Holdings (3382 JP) earnings, confirmation of the York Holdings timeline, stories about Apollo, KKR, and CP Group providing MBO financing.
• We’ve also seen Itochu confirm the financing request from the Ito family, and two American banks tapped to provide LBO financing.
• York Holdings itself gets created this month, and a buyer decided “in spring” with a Group Buyer/Outcome possibly decided by the May AGM. Looks skewed to me.

• Japanese Prime Minister Shigeru Ishiba’s meeting with US President Trump shines the spotlight on potential US tariffs on Japanese cars. Toyota Motor’s (7203 JP) high implied volatility expresses elevated risk.
• Risk analysis suggests a range of option strategies. Implementation is challenging due to low liquidity in the Japanese market.
• Option liquidity is higher in the US traded Toyota Motor Corp Spon ADR (TM US) which is the preferred route of implementation.

• On the 10th December 2024, Fosun Tourism (1992 HK) announced a Scheme buyback, with a Cancellation Price of $7.80/share (not declared final), a chunky 95% premium to undisturbed.
• Assuming the Scheme gets up, Fosun International (656 HK) and concert parties would hold 100% in Fosun Tourism.
• The Scheme Doc is now out, with a Court Meeting on the 4th March, and expected settlement on the 26th March. The IFA (Altus Capital) says “fair and reasonable”.

• If based on the market value of HK$20.246 billion to HK$23.185 billion in this IPO, a single store market value is about HK$2-2.4 million, higher than that of Baicha Baidao.
• Our forecast of 2024 net profit is RMB1.4 billion. Based on IPO price range of HK$8.68-9.94 per share, P/E is about 13.5-15.5x. There is still some upside room for valuation.
• Investors may need more “safety margins” on valuation due to the pressure of performance growth after IPO.The higher the IPO price, the greater the risk of future valuation downward revisions.

• Aequitas Research’s weekly update on the IPOs, placements, lockup expiry and other ECM linked events that were covered by the team over the past week.
• On the IPO front, neither of the two listings performed last week, while more are lining up to list across the region.
• On the placements front, given the ongoing earnings season there weren’t any deals. We did look at lockups and other possible upcoming deals.

• Tam Jai Intl (2217 HK)‘s suspension has led to speculation about a privatisation or takeover. Its huge net cash, equal to 115% of market capitalisation, makes it appealing. 
• Its controlling shareholder Toridoll Holding Limited owns a 74.61% stake and there is no shareholder with more than a 5% interest. This makes a deal seemingly simple.
• Assuming priced at the average P/B of 1.63x, this means HK$1.90, or 110% premium to the latest close, which is costly to the major shareholder.

• Yum China Holdings (9987 HK) posted robust year-over-year operating profit growth in 4Q2024 on the back of low single digit sales increase and operating efficiencies.
• Despite significant sector headwinds, Yum China has managed to outperform peers and grow ahead of sector in 2024 by swiftly adapting  to shifting consumer preferences.
• Yum China’s value-for-money QSR model with mid-tier pricing amidst tough sector outlook implies limited margin upside, a likely single-digit sales growth outlook, and a modest dividend yield for 2025.

• JB Hi-Fi Ltd (JBH AU) announced HY 2025 results this morning. Price increases 5.5% in early trading but gains were lost by noon.
• Sales Up 9.8% to A$ 5.67m; EPS up 8.0% to A$ 2.611; interim dividend up A$ 0.12 to A$ 1.70. Results are in-line/slight beat.
• Volatile trading can make for opportunities. Investors can speculate on a positive Post Announcement Earnings Drift (PEAD) or consider option strategies, as implied volatility remains elevated.

• Softcare (SOFT HK) is looking to raise at least US$300m in its upcoming Hong Kong IPO. The deal will be run by CICC, CITIC and GF Securities.
• SC is principally engaged in the development, manufacturing and sales of baby and feminine hygiene products, focusing on the fast-growing emerging markets, including Africa, Latin America and Central Asia.
• As of September 30, 2024, SC had 18 sales branches in 12 countries, and an extensive sales network across over 2,500 wholesalers, distributors, supermarkets, and other retailers in total.

• Revenue decreased by 3.4% YoY to JPY316.2bn, with a decline in new game console demand impacting sales.
• Gross profit increased by 7.0% YoY to JPY127.3bn, while operating profit margin fell to 3.1% due to higher SG&A expenses.
• Sales of secondhand goods rose 12.5% YoY to JPY140.4bn, driven by increased secondhand market demand and store expansions.

• Companies with high stock price valuations are often characterized by high foreign shareholdings and high return on capital, and valuations cannot be raised simply by disclosure without improving profitability.
• Companies that proactively disclosed to TSE requests were those with large market capitalization and high foreign ownership. They usually try to use their cash effectively for investment and shareholder returns.
• Raising profit margin is the best way to improve capital profitability. It’s clear that challenge lies in restructuring the business portfolio and reorganizing the industry, which few companies could do.

• Our base case valuation of Guming Holding is implied target price of HKD 13.70, which is 38%  higher than the high end of the IPO valuation range. 
• Given the solid upside, we have a Positive view of this IPO. Our valuation sensitivity analysis suggests a range of HKD 11.09 to HKD 16.57 per share.  
• Our base case valuation is based on 2025E P/S multiple of 3x, which is a 30% premium to the two closest comps (Sichuan Baicha Baidao Industrial and Helens International Holdings). 

• Relevant departments are discussing the promotion of drugs included in VBP scope to enter retail pharmacies. However, the new business model will be detrimental to valuation performance for retail pharmacies.
• The gap in the distribution of funds among biotech companies is rapidly widening. We suggest investors focus on leading biotech rather than take risks in areas with higher uncertainties.
• Vesync is a good company. Due to the low liquidity, the Proposal presents a good opportunity for shareholders to exit. Considering its future growth potential, Share Alternative can be considered.

• A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
• ECM developments: Hexaware Technologies (HEXW IN) seeks to raise US$1 billion, and Guming Holdings (1364 HK) seeks to raise US$202 million.
• Event-Driven developments: Shibaura Electronics (6957 JP), Fuji Soft Inc (9749 JP), Proto Corp (4298 JP), Tohto Suisan (8038 JP), Tecnos Japan (3666 JP), Pentamaster International (1665 HK). 

• Archer-Daniels-Midland Company (ADM) ended the fourth quarter and full year 2024 with adjusted earnings per share of $1.14 and $4.74, respectively.
• Despite challenges, the company’s approach to operational efficiency has yielded some benefits across its network, reflected in fourth-quarter operating profit of $1.1 billion and $4.2 billion for the full year.
• ADM achieved solid performance in particular segments, with increased crush volumes globally and operational efficiencies in North American soy processing.

• Mondelez International reported its financial performance for the fourth quarter and full year 2024, alongside its outlook for 2025.
• In 2024, Mondelez demonstrated a strong operational performance, with mid-single-digit growth in both top-line and gross profit dollars.
• The company reported organic net revenue growth of 4.3% and adjusted gross profit growth of 5.1%, underpinned by disciplined pricing and cost management amid ongoing input cost inflation.

• Omnicom Group, a leading global marketing and corporate communications holding company, has reported strong third-quarter results for 2024, showing evidence of effective strategy implementation and robust financial health.
• The company has recorded an organic growth rate of 6.5%, consistent across both its total operations and specifically within the U.S market.
• This performance is primarily driven by notable achievements in the Advertising & Media and Experiential disciplines.

• PepsiCo’s latest financial results and future outlook shed light on the company’s current operational dynamics and strategic priorities.
• The earnings call emphasized PepsiCo’s focus on long-term growth strategies, amplified investments, and a cautious approach to navigating a volatile economic environment.
• Here are the key takeaways from the call: PepsiCo has been keen on reinvigorating its Frito-Lay business amidst a challenging market environment.

• Ingredion Incorporated’s latest earnings report highlighted mixed results for its fourth quarter and full-year 2024 performance.
• The company saw significant double-digit adjusted earnings per share growth driven by robust sales volume growth in its Texture and Healthful Solutions segment and notable operating income growth in the Food and Industrial Ingredients segments, particularly in the U.S./Canada region.
• This growth was facilitated by the renewal of multiyear contracts that helped Ingredion recuperate inflationary impacts and improve margins.

• Chipotle Mexican Grill’s fourth-quarter 2024 results present a mixed picture of robust growth and operational challenges.
• The company saw a 13% increase in sales, reaching $2.8 billion for the quarter, driven by a 5.4% increase in comparable sales and a notable 4% increase in transaction growth.
• For the full fiscal year 2024, sales grew by 15% to $11.3 billion, with a 7.4% increase in comparable sales including over 5% transaction growth.

• Korea’s first ATS goes live on March 4, starting with 10 tickers based on liquidity and market cap, expanding to 800 over time. First 10 revealed next week.
• KRX vs ATS arbitrage will be key, with execution speed differences causing price dislocations, especially for KOSPI 200 stocks. Lower ATS fees may shift institutional flow, increasing arb opportunities.
• On top of that, lack of market makers could widen bid-ask spreads, creating opportunities for spread scalpers to profit.

• CP ALL (CPALL TB) has seen a rout in its share price as investors worry that it may be drawn into investing in Seven & I Holdings.
• Indications suggest that if it was to invest, the stake would be much smaller than previously reported and it would likely come with some beneficial concessions.
• CP ALL (CPALL TB) continues to see a strong recovery in both sales and profitability, with a positive outlook for FY2025, whilst valuations have been compressed to attractive levels.

• Ganesha Ecosphere (GNPL IN)’s Q3 FY25 revenue surged 39.6% YoY to ₹397.8 crores, with production volume up 22.3% YoY, and capacity expansions underway.
• Strong revenue growth and capacity expansions enhance GEL’s market position amid rising global demand for sustainable PET recycling.
• Investors gain confidence in GEL’s strategic shift towards high-value recycled products and international market expansion, promising long-term sustainability.

• Cato Corporation is a value play for investors due to its strong history of profitability and loyal customer base
• The company has faced challenges in recent years but has potential for a rebound once economic conditions improve
• Cato’s focus on delivering value and fashion-forward styles to a specific demographic positions it for long-term success and a solid return on investment

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• DXL Brands specializes in clothing for Big and Tall Men, offering a niche selection of clothing items designed specifically for this population.
• Despite not using AI technology, the company has shown steady growth and financial stability with a decrease in net debt and consistent EV.
• Customers appreciate the in-store experience, including assistance from stylists and a sense of community, making DXL Brands a reliable option for Big and Tall Men seeking stylish clothing options.

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• Kent R O Systems (6592700Z IN)  (KROS) is looking to raise about US$100m in its upcoming India IPO. The bookrunners for the deal are Motilal and JM Fin.
• KROS was established in 2007. The brand ‘Kent’ is a leader in the water purifier market in India, recognized for being a pioneer in introducing reverse osmosis (RO) technology.
• Kent’s water purifiers hold the NSF/ANSI 58 certification, an American national standard for point-of-use reverse osmosis systems, as per Technopak Report.

• Tyson Foods started fiscal 2025 with a solid performance across multiple segments, particularly in Chicken, marking the best first-quarter adjusted operating income within the past eight years.
• The company’s diversified multi-protein portfolio has been fundamental to balancing challenges faced in the Beef segment, where improved results surpassed expectations despite ongoing pressures from cattle cycle dynamics.
• Notably, International operations also reported substantial profitability improvements, contributing to the overall performance.

• ARATA’s cumulative Q3 FY03/25 sales reached JPY754.5bn (+4.9% YoY), with operating profit at JPY13.1bn (+4.4% YoY).
• Gross profit was JPY74.5bn (+5.5% YoY), with SG&A expenses rising 5.9% YoY to JPY61.4bn, impacting operating profit.
• Sales growth was notable in Health & Beauty (+5.3% YoY) and Pet categories (+6.5% YoY), with strong channel performance in DIY centers (+7.4% YoY).

• Consolidated revenue grew 13.3% YoY, driven by parent revenue growth and proactive inventory strategies, enhancing merchandising.
• Operating profit rose 38.1% YoY, with SG&A expenses increasing 10.9% YoY due to personnel and advertising costs.
• Revenue from existing stores increased 12.2% YoY, with customer count up 10.3% YoY and average spend up 1.8% YoY.

• Autoliv, Inc. recently concluded its earnings presentation for the fourth quarter and full year of 2024, showcasing a record-breaking quarter in terms of operating profit, margins, and earnings per share.
• Despite facing several market-related challenges, including a 5% year-over-year decrease in sales for the fourth quarter primarily due to adverse currency translations and regional light vehicle production (LVP) mix issues, Autoliv demonstrated resilience through cost management, operational efficiency, and strategic customer agreements.
• Baptista Research looks to evaluate the different factors that could influence the company’s price in the near future and attempts to carry out an independent valuation of the company using a Discounted Cash Flow (DCF) methodology.

• WellNeo Sugar (2117) today announced a deal to buy Toyo Sugar Refining (2107 JP) at a 27% premium. This is a small ¥11bn deal where insiders own 45%. 
• Normally I wouldn’t even talk about a deal this small but this one has something going for it. Two things actually. 
• And readers will have to read all the way down to the conclusions to find out the key one, but the setup is that it is too cheap.

• Yesterday, Yamaha Corp (7951 JP) announced Q3 earnings (results, presentation, metrics), a change in full-year guidance (revs unch’d, OP -10.8%, NP -25%), and a large buyback. 
• 9M Revenue up yoy but China sales slower OP up yoy (audio business, SG&A cuts), but FY revised lower due to restructuring (impairment, retirement expenses). Looks worse than it is.
• The buyback is interesting, and large. And investors should be aware of the modalities. 

• On 6 February, Cosmecca Korea (241710 KS) launched a partial tender offer on Englewood Lab (950140 KS).
• Cosmecca Korea announced that it plans to purchase 11% (2.185 million) of Englewood Lab’s outstanding shares at the tender offer price of 10,000 won. 
• It appears that this partial tender offer is an attempt by Cosmecca Korea to increase its stake in Englewood Lab even further, capitalizing on the lower share price.

• Whirlpool Corp (WHR US) is looking to raise about INR 46bn (US$530m) from selling a stake of about 31% in Whirlpool of India Limited (WHIRL).
• In an announcement released on Jan 30, 2025, the firm mentioned its ultimate parent’s intention to sell down its interest in WHIRL from 51% to 20% by mid-to-late 2025.
• In this note, we talk about the past deal performance and other deal dynamics.

• Guming Holdings (1364 HK) (Good Me) is getting ready to complete its IPO on the Hong Kong Exchange in February.
• At the high end of the IPO price range, the listing will raise about HK$1.58 billion (US$220 million).  
• Guming is a ready-to-drink beverage company specializing in freshly made tea beverages.

• Following their inclusion in the F&O segment in November, Zomato (ZOMATO IN) and Jio Financial Services (JIOFIN IN) appear to be sure-shot inclusions to the NIFTY Index in March.
• Bharat Petroleum Corp (BPCL IN) is a certain deletion from the index. Britannia Industries‘ average free-float market cap is less than 0.004% below Hero Motocorp‘s. It’s very close.
• Passive trackers need to trade between 3.7-11.8 days of ADV on the stocks. The impact increases significantly to between 8.4-21.8 days of delivery volume to trade on the stocks.

• BrainBees Solutions (FIRSTCRY IN) (FirstCry) raised around US$500m in its August 2024 India IPO. The lockup on its pre-IPO investors is set to expire soon.
• In India, FirstCry sells Mothers’, Babies’ and Kids’ products through its online platform, company-owned modern stores, franchisee-owned modern stores and general trade retail distribution.
• In this note, we will talk about the lockup dynamics and possible placement.

• Record Margins: Q2 OP surged 82% YoY to ¥7.1b, with Japan profitability up and losses narrowing in Fintech and the US.
• US Breakeven Play: Aggressive cost-cutting led to 12ppt margin improvement; if growth stalls, a sale or exit could boost margins by 200bps.
• Fintech Upside: Losses peaked last year, with 16ppt OPM improvement; breaking even could add 400bps to group margins.

• Euro Pratik Sales Ltd (7778885Z IN) (EPS) is looking to raise about US$100m in its upcoming India IPO. The bookrunners for the deal are Axis, Dam Capital.
• The company operates in the decorative wall panel and decorative laminates industry as a prominent seller and marketer of Decorative Wall Panels and Decorative Laminates. 
• According to the Technopak Report, has established itself as one of the largest organized Wall Panel brands, with a market share of 15.87% by revenue.

• Cavco Industries, Inc. reported strong third-quarter results for fiscal year 2025, underscored by a combination of improved performance in its financial services and factory-built housing segments.
• The company’s EPS rose significantly by 30% sequentially, reaching $6.90.
• Notably, the Financial Services segment recorded its strongest quarterly profit in four years, attributable to more effective underwriting, higher insurance premiums, and favorable weather conditions leading to lower claims.

• The SET50 index tracks the performance of the top 50 largest and most liquid names listed on the Stock Exchange of Thailand (SET).
• In this insight, we take a look at the potential ADDs/DELs for SET 50 during the index rebal event in June 2025.
• Currently, we see three expected changes. However, since the reference period is yet to start, the rankings can fluctuate significantly before the base date.

• Guming Holdings (GUM HK) (Good me), a freshly-made tea store brand, has launched an HKEx IPO to raise up to US$202 million.
• We previously discussed the IPO in Guming Holdings (Good Me) IPO: The Bull Case and Guming Holdings (Good Me) IPO: The Bear Case.
• There are five cornerstone investors. Our valuation analysis suggests that Guming is attractively valued at the IPO price range. Therefore, we would participate in the IPO.

• SHEIN (1895674D HK) returns to India after a five-year hiatus under a license agreement with Reliance Industries (RIL IN) owned Reliance Retail ltd.
• India’s vast, untapped market for fast fashion, driven by a large and growing young population, rising disposable incomes, and increased e-commerce penetration presents an attractive growth opportunity for Shein.
• Shein faces growing challenges in the US due to new trade restrictions. Its partnership with Reliance could serve as a strategic move to develop alternative supply chains outside China.

• After reducing the IPO price, and the placement size, WH Group (288 HK) has now completed the spin-off of Smithfield Foods (SFD US).
• Preceding my comments on the WH Group are the current setup/unwind tables for Asia-Pacific Holdcos.
• These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation >20%.

• Foshan Haitian Flavouring & Food Company (FHF HK), the largest condiment company in China, is seeking an H-share IPO in Hong Kong. 
• It has established brand recognition and leadership positions, product innovation and diversification, opportunities from industry consolidation, and steady earnings with net cash.
• Assuming a 28% HA discount, the same as the HS Stock Connect, this implies an FY25 PER of 23.2x. Versus Kikkoman Corp (2801 JP)‘s 23.8x, this seems not attractive enough. 

• Lack of transparency and inadequate financial disclosures at Daily Journal Corporation
• Detailed analysis suggests the stock is severely overvalued
• Significant downside risk for investors in DJCO

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• Dividends are still the mainstay of shareholder returns, but shareholder returns, including share buybacks, became a standard “P/B raising measure,” which is why share buybacks increased on a company-by-company basis.
• Share repurchases increased significantly this year as large cross-holding share dissolutions were undertaken through share repurchases. Share buybacks will continue increasing due to share repurchases for dissolution of cross-shareholdings.
• Companies that have been reluctant to retire treasury stock are finally moving to do so. This is expected to be a change of the companies.

• Ferrari N.V. (RACE US) reported Q4 FY24 revenue and earnings growth of 14% and 32%, exceeding analyst profit estimates by 14% due to improved product mix and pricing.
• Management provided conservative guidance for FY25, projecting baseline revenue and EPS growth of 5% and 2% YoY, consistent with Ferrari’s conservative historical approach to guidance.
• The stock trades at 47x FY25 PE and 26x EV-EBITDA. With 81% repeat customers and 48% multiple owners, Ferrari is expected to sustain pricing power and grow high-margin revenues.

• Tam Jai International (2217 HK), an operator of Asia noodle specialty restaurants, is currently suspended pursuant to the Takeovers Code.
• On the 13th November 2024, Tam Jai announced 1H25 net profit – to 30th September 2024 – declined 55.8% yoy to HK$36.1mn, its lowest six-month tally since listing. 
• Toridoll Holdings Corporation (3397 JP) controls 74.61% of Tam Jai. Expect a Scheme to unfold. An Offer price around HK$1.50/share would be welcome. That’s probably a stretch.

• Proto Corp (4298 JP) is not the name on people’s lips, but everyone who knows cars in Japan knows this company. They have run car mags for decades.
• Now they do other things too but car magazines, websites, and associated data provision are worth 90% of OP. And they are ubiquitous, and growth has been good. 
• Management forecasts for growth are a damp squib. This is opportunistic. 

• Tohto Suisan (8038 JP)‘s tender offer from Aso Corp is JPY7,500, a 39.1% premium to the last close. Tohto Suisan is currently in breach of the tradable share ratio.
• Unusually, the offer has no lower or upper limit. If the required ownership ratio is secured, Aso will implement squeeze-out procedures. 
• While supportive, the Board has left the decision to accept or reject the offer at the shareholders’ discretion. The offer is attractive and represents an all-time high.

• Ola Electric (OLAELEC IN) raised around US$734m in its India IPO in August 2024. The lockup for its pre-IPO investors is set to expire soon.
• Ola Electric Mobility is a vertically integrated pure EV player in India with manufacturing capabilities for EVs and EV components, including cells
• In this note, we will talk about the lockup dynamics and possible placement.

• Proto Corp (4298 JP) has recommended an MBO tender offer at JPY2,100, a 64.1% premium to the last close.
• The offer is attractive as it is above the midpoint of the target IFA’s DCF valuation range and 25% above the all-time high.
• Despite the presence of two substantial shareholders, an attractive offer suggests that this is a done deal. The tender offer ends on 21 March, with payment on 28 March

• Guming Holdings (GUM HK) is looking to raise US$202m in its Hong Kong IPO. Guming Holdings (Guming) sells freshly-made beverages in China.
• Guming Holdings (Guming) sells freshly-made beverages in China. Guming focuses on the mid-priced freshly-made tea beverage market with product prices typically ranging between RMB10-18.
• In this note, we discuss our thoughts on valuation at the IPO price range.

• By executive order, President Trump suspended section 321 (“de minimis“) imports on Feb 4th
• Direct-To-Consumer imports valued at < US$800 may no longer enter the US duty-free
• Added cost and new paperwork burden (both borne by US consumers) to hit SHEIN, Temu

• 4+ years ago Aso Corp launched a Tender Offer to buy 33.4% or up to 100% of marine products wholesaler Tohto Suisan (8038 JP). They got just over a third. 
• Then it became a zombie as I warned Tohto Suisan Partial Tender Offer – A Weird Tender Which Leads To Listed Zombie-Ism. But it moved around. 
• Today, Aso announces a tender to take out minorities, almost all of whom are other corporate holders. It’s at a 39% premium and 1.2x book. It should get done.

• Guming Holdings (GUM HK) is offering 158.6 million shares in a price range of HK$8.68 to HK$9.94 in its Hong Kong IPO aiming to raise up to HK$1.58 Bn.
• Despite outperforming peers in revenue and profit growth, Guming is grappling with a bleak macro environment, operational slowdowns, and intensified competition.
• Guming Holdings (GUM HK) ‘s faltering operating metrics for last reporting period cast doubt on its near-term growth and profitability outlook—leaving investors to ask: Sip or skip?

• Multi Bintang Indonesia (MLBI IJ)  saw significant inflection in Q3 FY24, with revenue and net profit growth of 21.9% and 35%, respectively. Strong growth is anticipated in Q4’s high season.
• Our confidence in MLBI’s Q4 stems from Bali’s impressive tourism statistics, registering a 17% YoY increase in Q3 FY24 and 19% YoY in Q4 FY24 (up to November).
• With a 10.4x FY24e PE valuation, over 9% dividend yield, and historical ROCEs surpassing 80%, we believe the share price is at a turning point.

• On 27 December 2024, Vesync (2148 HK) disclosed a Cayman scheme privatisation offer from the Yang family at HK$5.60. On 28 January, the antitrust condition was satisfied.   
• Despite a light offer, the scheme vote is low-risk. No disinterested shareholder holds a blocking stake, there is a scrip option with no cap, and there is no retail opposition. 
• The scheme document will be despatched by 11 April. At the last close and for an end-of-May payment, the gross and annualised spread is 6.9% and 22.7%, respectively.  

• Back on the 27th December, Vesync (2148 HK), a manufacturer of small home appliances, announced an Offer, by way of a Scheme, from the Yang family controlling ~69.04% of Vesync. 
• The Cancellation Price of $5.60/share, declared final, was a 33.3% premium to undisturbed, and above the 2020 IPO price of HK$5.52/share.
• The US anti-trust condition has now been fulfilled. The Scheme Doc dispatch has been extended to the 11 April. I estimate payment under the Offer late May. 

• Rubber production in December suffers a loss of 30%  
• Yokohama Rubber plays Good Samaritan in hour of crisis  
• CMO enabling FSC Certification for Thai rubber for EUDR

• We reviewed Lever Style’s (1346 HK)  positive profit alert and project a final dividend of 7-7.5 cents, an increase from 3 cents per share in H1 FY24.
• The overall dividend of 10-10.5 cents indicates a yield over 9%, with positive remarks on new customer additions and increased penetration within the existing customer base.
• Our top sector picks include JNBY Design Ltd (3306 HK) and Pacific Textiles (1382 HK), with a favorable mention of Nameson Holdings (1982 HK)  due to its attractive dividend yield.

• There were no new spin-off announcements this week, but I’ve done some more work on the Aptiv (APTV) spin-off announcement.

• Aptiv PLC (APTV), an automotive technology supplier, announced on January 22, 2025, that it plans to split into two distinct companies.

• Aptiv will spin-off its electrical systems business. The RemainCo will concentrate on technological components, including sensor-to-cloud solutions and autonomous driving software.

• Pulmuone has benefited from improved sales and profitability of its US subsidiary, driven by higher demand for Korean foods and plant based/non-meat based foods such as tofu.
• The company has nearly 70% market share in the tofu segment in the US. It has gained meaningful economies of scale of its tofu product in the United States. 
• Pulmuone currently has a market cap of 390 billion won. Using the consensus net profit estimate of 37.6 billion won, this would suggest a P/E of 10.3x.

• Benson Hill exited after a +100% share price spike, despite a 38% loss; concerns over cash and buyout proposal persist.
• Marlowe position closed with a 23% return; buybacks had no impact on share price, concerns over future decline.
• DMC Global faces conflict with Steel Connect over valuation and acquisition proposals; Arcadia’s former president returns.

• Whirlpool Corporation’s fourth-quarter 2024 performance exhibited both areas of progress and challenges.
• The company acknowledged that while their financial outcomes have not fully met expectations, they have made strides in operational efficiency and portfolio transformation.
• Notably, the completion of the Europe transaction marked a significant transition in creating value opportunities.

• With about 40% of companies having a P/B of less than 1x, the problem is that many disclosures do not understand management to create value and increase the stock price.
• It’s difficult for investors’ voices to reach small cap companies and companies with still high defensive walls of cross-held shares, which are not easily targeted for investment by institutional investors.
• Independent directors should be appointed with skillset to participate in developing management plans and scrutinize them for reasonableness and whether the projected corporate value is gapped from that of investors.

• The special dividend actually exceeded investors’ expectations. As long as the dividend yield is higher than the risk-free rate, then Fu Shou Yuan is worth holding for the long term.
• Fu Shou Yuan’s 2024 full-year performance could fall short of expectations. As the business model is not as excellent as previously imagined, long-term growth rate would fall to single digit.
• Since high valuation is unsustainable without the support of strong future growth momentum, investors who pursue for capital gains could consider taking profits by taking advantage of share price rally.

• Fosun Tourism (1992 HK)‘s profit warning suggested a significant deterioration in profitability in 2H24, fading any near-term recovery hope. 
• With losses enlarged 89-126% YoY in 2H24, it is more difficult to return to its peak and IPO share prices. This makes the buyback proposal even more attractive.
• We take the inability to introduce the Potential Share Alternative Option as a lack of confidence by the existing shareholders in Fosun Tourism’s medium-term outlook.

• Back on the 10th December 2024, Fosun Tourism (1992 HK) announced a rare Scheme buyback, with a Cancellation Price of $7.80/share (not declared final), a punchy 95% premium to undisturbed. 
• A successful Scheme would result in Fosun International (656 HK) and concert parties holding 100% in Fosun Tourism – without having to outlay a cent. 
• A scrip alternative was afforded IF expressions of interests from 1% of shares out occurred. That didn’t happen. Still a clean deal. Scheme Doc dispatch is the 14th Feb.

• There is a need to change the mindset of company managers who consider IPO as a goal and not a way to grow after the listing.
• The listing criteria for TSE Growth Market will be raised as early as April 2026. It’s clear that the current listing criteria are far from liquid enough to invest in.
• For companies that are already listed, some rule should be established to either de-list them because they cannot bear the listing cost or to increase their market capitalization through M&As.

• Bama Tea (BAMA HK) is looking to raise at least US$100m in its upcoming Hong Kong IPO. The deal will be run by Huatai, ABC and TF International.
• Bama Tea, as per the firm, is the most recognized tea brand in China and the leading provider of premium tea leaves in China.
• It sells through its nationwide offline store network and comprehensive online sales platforms, and sells every major tea leaf category

• Sales reached JPY178.0bn, a 7.0% YoY increase, with directly managed stores contributing 98.9% of total sales.
• Operating profit rose 16.9% YoY to JPY13.2bn, while net income increased 18.3% YoY to JPY8.9bn.
• The company opened 84 directly managed stores and closed 49, totaling 2,056 stores by end-Q3 FY03/25.

• Yellow Hat’s cumulative Q3 FY03/25 sales increased 4.9% YoY to JPY119.1bn, with operating profit up 9.6% YoY.
• The medium-term plan targets FY03/28 revenue of JPY180.0bn, operating profit of JPY16.8bn, and net income of JPY11.8bn.
• Planned investment of JPY33.0bn from FY03/26 to FY03/28 includes JPY28.0bn in capex and JPY5.0bn for M&A.

• It was confirmed on Friday afternoon Fast Retailing (9983 JP) was a single cap move, NOT a double-capping in a single Review. That limits the sell down.
• Chemist Warehouse’s reverse buyout of pharmacy wholesaler Sigma Healthcare (SIG AU) is now all-but complete.
• Takeda Pharmaceutical (4502 JP) announced decent results, decently upgraded guidance in both IFRS/GAAP terms and in Core/Adjusted terms (less impressive uplift in Adjusted/Analysed terms). They also announced a ¥100bn buyback.

• Tesla’s fourth-quarter earnings highlighted a company at the crossroads of transformation and challenge.
• Despite achieving a record market valuation of $1.5 trillion in December, the company’s core automotive business struggled, with an 8% year-over-year revenue decline.
• Demand softened, particularly for the Cybertruck, forcing Tesla to rely on aggressive promotional strategies to sustain sales.