Consumer

• KRX confirmed no immediate changes on KRX Semicon and KRX Autos. The universe will switch from BMI to TMI large and mid-caps, with constituent updates happening in the September rebalancing.
• TMI rebalances quarterly, while KRX Semicon and Autos rebalance annually in September. KRX confirmed these indices will use the September TMI rebalancing results.
• TMI rebalances quarterly, likely releasing results before KRX Sector Indices, giving a window to predict shifts in KRX Semicon and Autos stocks and position ahead of the sector rebalancing.

• E Mart’s Chairman Chung Yong-Jin will receive the entire 10% shares of E Mart held by his mum Lee Myung-Hee.
• After this transaction, Chung Yong-Jin will become the largest shareholder in E Mart with a 28.6% stake in the company.
• This is likely to positively impact E Mart. In Korea, when the final major ownership stake is transferred, there is often a positive boost to the share price.

• Adani Enterprises (ADE IN) exits Adani Wilmar (AWLTD IN), selling its entire 44% stake for over $2 billion, redirecting funds toward core infrastructure ambitions.
• The exit frees capital for energy, transport, and logistics projects, showcasing Adani’s commitment to strategic resource deployment and robust corporate governance.
• Adani’s strategic divestment highlights its focus on infrastructure-driven growth, underscoring the potential for shareholder value creation through timely exits from non-core businesses.

• Destination XL Group received a non-binding $3/share proposal from Fund 1 Investments, holding a 21% stake.
• Fund 1’s offer values DXLG at 6.1x EBITDA, with potential for a higher bid if additional value is identified.
• DXLG repurchased 6.6% of shares in Q3 2024 at an average price of $2.80/share, totaling $10 million.

• It is commendable that more listed companies as a whole are setting ROE and ROIC as their targets. The real value of actually achieving these goals will now be tested.
• Dividend Policy score, Treasury Shares Retirement score, AGM Disclosure score, and IR Disclosure score improved slightly, but the listed companies as a whole have yet to show improvement.
• Even though higher stock prices negatively impacted Policy Stock Holding score, overall improvement has not been achieved for the listed companies. Cash allocation also remains an issue for many companies.

• Onward Holdings’ sales increased by 6.1% YoY to JPY149.9bn, while operating profit decreased by 11.8% YoY to JPY8.6bn.
• Domestic Business sales rose by 6.5% YoY to JPY136.8bn, but operating profit fell by 14.9% YoY.
• Overseas Business sales increased by 1.3% YoY to JPY13.1bn, with a significant narrowing of operating loss.

• PepsiCo’s results for the third quarter of 2024 reflected the complexities of navigating through evolving consumer habits and geopolitical challenges.
• The company reported a deceleration in growth due to several factors, indicating both challenges and strategic initiatives needed for future growth.
• One of the main highlights is the Frito-Lay segment, which, after experiencing significant double-digit growth over the last few years, is expected to normalize this year.

• LXJ International Holdings (LXJ HK) is looking to raise atleast US$100m in its upcoming Hong Kong IPO. The deal will be run by CICC and Haitong.
• LXJ International Holdings Limited (LXJIH) is a Chinese-style QSR brand having a chain of fast food restaurants in China.
• It was ranked first in the Chinese-style QSR industry in China by GMV in 2023, according to CIC, making it the largest Chinese-style QSR brand in China.

• Highlights ·       Set to finish 2024 with a 30% rise in rubber sale values YoY ·       Exports tires worth US$772.5 million during Jan-Nov 2024 ·       Minister charts course of action for 2025   Cambodia has made impressive strides in 2024, fueled by higher global rubber prices and exceptional progress in its burgeoning tire production and export industry, marking a pivotal step in its transformation into a key player in the global rubber value chain.
•   The Southeast Asian kingdom earned US$472 million from exports of NR latex during January-October 2024, up 22.5% over the same period the previous year.
• On the other hand, it gained US$568 million from exports of the product during January-November 2024, up 26.7% over the same period in 2023.

• Champion Homes showcased a robust performance in the second quarter of fiscal 2025, highlighting several strategic advancements and operational efficiencies, although not without challenges.
• The company’s net sales saw a substantial year-over-year increase of 33% to $617 million, significantly boosted by a 37% rise in U.S. factory-built housing revenue.
• This growth was predominantly driven by a 31% increase in the U.S. homes sold, aided by the augmented retail and manufacturing capacity following the Regional Homes acquisition, which alone contributed $148 million to the quarter’s net sales.

• Recent news on the Seven & I Holdings (3382 JP) situation includes better-than-expected possible sale of the SST business, a little headline fear-mongering on national security, and earnings.
• Earnings this year will be volatile vs expectations. Timing (and magnitude) of kitchen-sinking matters. But neither ACT nor you should be buying it based on trough earnings expectations.
• The call transcript is worth listening to. The math on the takeover maths well. This is a buy on dip. Again. 

• Bloks (325 HK)  is expected to be assigned an index nationality of Hong Kong instead of China due to its incorporation in the Cayman Islands.
• The security is expected to be added at the September 2025 review following the 6-month IPO lock-up expiry which increases the fcap above the APAC threshold.
• The security is ineligible for the other global index until January 2026 because of the free float being below the minimum threshold of 15%.

• KOSPI 200 is a Korean blue-chip index that tracks the 200 largest and most-liquid names listed in the KOSPI section of the Korea Exchange (KRX).
• In this insight, we take a look at the names leading the race to become ADDs and DELs during the upcoming semiannual review in June 2025.
• We expect six ADDs and six DELs for the KOSPI 200 index during this index rebal event based on the latest available data.

• Guming Holdings (GUM HK) is looking to raise US$300m in its upcoming Hong Kong IPO.
• 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 our earlier notes, we had looked at the firm’s past performance. In this note, we discuss its refiling updates.

• Fast Retailing reported significant gains in revenue and profitability for the first quarter of FY2025.
• Strong performances in North America & Europe (+31% YoY), and Asia (+17%), offset challenges in Greater China (-1%)
• Overall revenue and operating profit figures came in marginally stronger than our estimates

• Greaves Electric Mobility Ltd (GEML) (1295040D IN) is looking to raise about US$120m in its upcoming India IPO. The bookrunners for the deal are Motilal Oswal, IIFL, JM fin.
• GEML is a manufacturer of electric vehicles in India, specializing in electric two-wheelers and three-wheelers.
• The company is recognized as one of the pioneers in India’s electric vehicle (EV) market, playing a significant role in driving EV adoption in the country, as per CRISIL Report.

• Toll Brothers, a prominent luxury homebuilder, delivered a robust performance in the fourth quarter of fiscal 2024, demonstrating resilience and adaptability amidst external challenges.
• The company’s financial results were highlighted by a significant increase in home deliveries and sales revenues.
• It delivered 3,431 homes, marking a year-over-year increase of 25% in unit delivery and a 10% rise in revenue, totaling $3.3 billion.

• Aspen Aerogels, Inc. is a leading company in high-performance aerogel technology, specializing in thermal management solutions for industries like electric vehicles, energy infrastructure, and sustainable building insulation.
• Their PyroThin® insulation product is popular in the EV sector due to its ability to enhance battery safety and performance.
• Founded in 2001 and headquartered in Massachusetts, Aspen has seen significant revenue growth and market expansion, with a market cap of $1.6 billion in Q3 2024, positioning them for further growth in the energy-efficient sectors they serve.

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.

• LXJ International Holdings (LXJ HK) (knowns as Lao Xiang Ji or Home Original Chicken) is getting ready to complete its IPO in Hong Kong in 1H 2025. 
• Founded in 1982 by Shu Congxuan, LXJ International specializes in traditional Chinese style chicken dishes. The company is one of the major local players in China’s fast food industry.
• LXJ’s solid growth in sales and profits in the past several years despite weak Chinese economy is a strong reflection of the company’s loyal customers in China. 

• Crizac (CRIZAC IN) is looking to raise US$120m in its upcoming India IPO.
• Crizac is an education platform offering international student recruitment solutions to global institutions of higher education in the United Kingdom, Canada, Republic of Ireland, Australia and New Zealand (ANZ).
• In this note, we talk about the company’s historical performance.

• Back on the 14th November, Ping An Healthcare and Technology (1833 HK) (PA Gooddoctor announced a change in use of proceeds, including the payment of a punchy HK$9.70/share special dividend.
• A scrip option was concurrently afforded. The results of that scrip election have now been announced, the completion of which, triggers an unconditional MGO from Ping An Insurance  (601318 CH).
• The MGO price is HK$6.12/share, a price made public last month. For those investors trading the event and who bought PA Gooddoctor cum dividend, it has worked out well.

• In this note, we will take a look at the Asia Pacific IPO pipeline for 2025, starting with Hong Kong.
• This list has been compiled on a best effort basis from tracking the company filings and through various other sources.
• The deals you see in this note are only a part of our full IPO pipeline tracker. Feel free to drop us a message for additional information on these IPOs.

• On 6 January, Smart Share Global (EM US) disclosed a non-binding proposal from a Trustar Capital-sponsored MBO at US$1.25 per ADS, a 74.8% premium to the undisturbed price of US$0.72.
• The offer is unattractive to the IPO price (US$8.50), average sell-side price targets (US$1.87) and historical trading ranges. 
• Despite the light offer, the shareholder vote is done (two-thirds voting threshold) as the buyer consortium represents 64.0% of the voting power. A binding proposal will be forthcoming.  

• Dream International, a Hong Kong-based company run by a Korean family, has seen significant growth in revenue and earnings per share over the past decade.
• Despite facing challenges such as theft of funds and holding a large cash pile, the company has shown strong performance with an 18% return on equity over the past 15 years.
• Trading at a low multiple of earnings and holding a significant cash reserve, Dream International presents an appealing investment opportunity for value investors due to its potential for continued growth and competitive advantages in the market.

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.

• Sony Group Corporation has exhibited a mix of strengths and challenges in its latest financial results, which provide insights into its current business landscape and future outlook.
• Positive aspects of Sony’s results are largely attributable to robust performance in key segments like Gaming & Network Services (G&NS) and Music.
• The company reported a 9% increase in consolidated sales, excluding the Financial Services segment, year-on-year, with operating income showing a significant increase of 57% for the quarter.

• Aspirasi Hidup Indonesia (ACES IJ) has forged ahead with its rebranding after ending its licensing agreement with ACES US, changing its store branding to AZKO from 1st January 2025.
• The new branding has already been rolled out to several stores but the company has given a 3-month window for all storefronts to be completed across Indonesia. 
• We view this rebranding exercise as an opportunity for the company to lift sales further through heavy promotions and a more aggressive store rollout. Valuations remain attractive relative to history.

• Brigade Hotel Ventures Ltd (BHV IN) is an owner and developer of hotels in India, focusing primarily on South India, plans to raise about US$107m through its upcoming India IPO.
• It has a current portfolio of  9 operating hotels, of which, 4, 3 and 2 are operated under Accor, InterContinental, Marriott brands.
• BHVL intends to use the IPO proceeds primarily to repay debt of INR 4.8bn and to purchase land from the promoter for further expansion.

• Tire production volumes are declining
• Major tire manufacturers are closing/withdrawing from the Chinese truck tire market
• Emerging competitors are expanding capacity, challenging established suppliers 

• Geely’s sales volume grew by 32% in 2024 and management set a growth target of 25% for 2025.
• BEV boomed in 2H24 and will be the protagonist in 2025.
• We believe the overseas market will also be promising for Geely.

• While companies are eager to improve ％ of female board members, for which they are required to meet new targets, they are less enthusiastic about raising ％ of independent directors.
• The improvement in ％ of independent directors has been decreasing year by year. As the importance of independent directors increases, it’s necessary to demand increase in this ratio through engagement.
• For the other evaluation criteria, the median value remained unchanged from the previous year. Meanwhile, some traditional companies have not been able to eliminate the position of ex-CEO advisors.

• On 17 November 2024, WH Group (288 HK)  announced an EGM to approve the spin-off and separately list subsidiary Smithfield Foods on the NYSE or NASDAQ. 
• WHG, the world’s largest pork producer, announced on the 6th December the spin-off overwhelmingly gained shareholder approval. 
• Yesterday, the Smithfield NASDAQ IPO doc was made public. As per the filing: “the number and dollar amount of Smithfield Shares to be offered and sold have not been determined“.

• The problem with cross-held shares is that management facing shareholders tends to be neglected if they remain protected by a defensive wall rather than a lower return on capital.
• The start of mandatory disclosure of policy shareholding policies from FY3/2025 will also help reduce policy shareholdings, which are expected to decrease gradually, but may remain as deemed shareholdings.
• To improve capital profitability, profit margins must increase, so restructuring the business portfolio and investing for growth are key. Management changes are required to implement these changes.

• Amer Sports, owned by ANTA Sports, is focusing on expanding in the Chinese market, particularly through the Arc’teryx brand
• New store openings in China are expected to drive revenue and EBIT growth for Amer Sports
• Arc’teryx faces stiff competition in the outdoor apparel market, with its technical attributes not standing out as much as expected, despite surpassing Canada Goose in revenue and having a strong presence in China

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.

• We are reiterating our Buy rating, $20 price target and projections for Lands’ End as we look forward to 2025.
• We believe, after an impressive return to profitability in FY24, Lands’ End management is poised to continue to build on their winning business model drivers (improved product, marketing and customer reach, Outfitters, international and licensing) to drive further upside into FY25 and amply demonstrate the power of Lands’ End to leverage a quintessential and trusted American brand to drive compelling returns.
• As such, we reiterate our Buy rating and $20 price target for LE.

• Founded over a century ago in 1920 as a wholesaler of packaging materials, SHIMOJIMA is a leading trading company specialized in providing comprehensive packaging materials, products and supplies, offering over 1,000,000 items, through its unique wholesale and retail omnichannel distribution structure.
• The Company’s nationwide omnichannel distribution network includes 16 regional sales offices, 18 SHIMOJIMA stores, 20 directly managed Package Plaza stores, and roughly 220 Package Plaza FC stores nationwide, the largest chain of packaging supplies specialty stores in Japan, in addition to the EC site ‘SHIMOJIMA Online Shop,’ as well as sales by Group companies with the ultimate benefit of building an easily identifiable brand image.
• SIR believes this will be a competitive advantage in capturing the upside opportunity from the four simultaneous growth drivers examined in this report.

• We are reiterating our Buy rating, $23 price target and projections for Guess?
• as we look forward to 2025.
• We believe, after their first acquisition, continued European expansion and investor worries over weak domestic performance in 2024, 2025 will a year for the company to begin to leverage their prior investments and shift the investment thesis forward to top line and margin expansion.

• We are reiterating our Buy rating, $40 price target and projections for JAKKS Pacific, as we believe, driven by strong Holiday movie content and among the easiest comparisons in recent history, the company is poised to register strong 1H25 results.
• More importantly, we believe, potential China tariffs excluded, JAKKS is building a base of key core items/categories (i.e. The Simpsons, Sonic, skateboards and Spring outdoor products) and international expansion, which will create the ability for JAKKS to register visible and impressive overall top and bottom line returns.
• Further, we also believe in 2025, given the company’s impressive financial position (no debt, approximately $2 per share in cash), JAKKS will begin to return capital to shareholders.

• EAF’s 9.875% note due in 2028 is trading at around 75, offering a potential return of over 25% in a 2-year timeframe
• Downside risk is protected with a cushion of under $550 million, while potential upside could reach up to 42% returns in just one year
• Despite past issues and cyclical headwinds, EAF has valuable assets like the Seadrift facility to cover its debt stack, making the credit situation particularly interesting at current levels

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.

• CABO’s stock has dropped by 45% since the previous writeup due to declining revenue and EBITDA in the fourth quarter of 2022
• Financial leverage and a large short interest have contributed to investor loss of confidence in CABO
• The writer suggests that the decreased stock price presents a better investment opportunity in CABO now

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.

• In December 2019, an article in slightly odd Japanese business magazine Sentaku (選択) suggested Fujitsu Ltd (6702 JP) would imminently seek to address dual listings of subs.
• Some subs went early. The auction for Fujitsu General (6755 JP) started spring 2023, failed, started again, failed again, and the shares languished. 
• Two years later we have a deal. Large privately-held company Paloma-Rheem Holdings is the buyer in a split-price deal which comes at a decent but not exorbitant premium.

• Fujitsu General (6755 JP) announced a preconditional tender offer from Paloma Rheem Holdings Co at JPY2,808 per share, a 23.5% premium to the last close.
• The offer, which is preconditional on regulatory approvals and will open in early July, is attractive compared to historical trading ranges and peer multiples.
• The process is lacking as Fujitsu declined to conduct an auction. The offer is below the midpoint of the IFA DCF valuation range, and the Board requested price.

• This Insight analyses Meituan (3690 HK) tailor-made option strategies traded over the last five trading days on the Hong Kong Exchange. Strategy highlights and volatility insights are provided.
• The vast majority of traders opt for bearish strategies, but there are examples of contrarian trades.
• Although one-month implied volatility is historically low in its 7th percentile, it is above realized volatility. With an implied just below 40%, option premiums are significant in absolute terms.

• Bloks Group, a founder-led toy maker and owner of trusted brand “Blokees”, will price its IPO this week. Shares are set to begin trading on January 10, 2025.
• I would expect strong first trading-day return as HK public offering was already 5,000+ times oversubscribed at high end of marketed price range.
• I believe investors are rationally optimistic about the company. Bloks Group IPO attracted a surge of retail investors, and the stock may skyrocket above IPO price on first trading-day.

• Without the buyback, it’s difficult to obtain reasonable market pricing by simply transferring the equity of Fosun Tourism or the equity of core assets, which is detrimental to Fosun Group.  
• To maximize returns, a wiser approach is to privatize Fosun Tourism first, then at a higher valuation level to spin off, sell, relist, attract strategic investment to “rationalize” the valuation.
• Heavy assets of Taicang/Lijiang projects would be sold. For core assets Club Med/Atlantis, the future plans could be different. It’s necessary to take a look at the Share Alternative Option.

• BYD’s deliveries grew by 51% YoY in December 2024 and 41% in the year 2024.
• The Brazil event will slow down overseas expansion, but overseas deliveries account for only 10% of total vehicles.
• We believe the stock has an upside of 39% and a price target of HK$356 for the next twelve months.

• AutoZone’s first quarter results for 2025 present a mixed bag of outcomes shaped by challenging economic conditions and strategic focus on growth initiatives, both domestically and internationally.
• The overall sales for the quarter grew by 2.1% year-over-year, reaching $4.3 billion, with a marginal improvement in overall same-store sales, up by 1.8%.
• Within the U.S., the company experienced subdued growth in domestic same-store sales at 0.3% and a 3.2% rise in commercial sales.

• Coway announced a significantly higher total shareholder return plan, nearly doubling total shareholder returns of consolidated net income from current 20% to about 40% in the next three years.
• Coway has low valuation multiples. It is currently trading at EV/EBITDA of 4.1x, P/E of 8.1x, and P/B of 1.4x based on 2025 consensus earnings estimates.
• We believe that the combination of improved shareholder returns and low valuation multiples are likely to lead to outperformance of Coway versus the market in the next 6-12 months. 

• Tough start to the New Year, implied vols rose with market decline on the first day of the year. Both markets are now trading at or near peak open interest.
• Volumes perked up, well ahead of the prior weeks levels with Calls still making up the bulk of trading in Hang Seng at 57% of all trades.
• Looking ahead, January has historically been one of the most  volatile months of the year for HSI, trailing only October for average historic volatility.

• Nike Inc. is at a pivotal moment as new CEO Elliott Hill endeavors to reverse a persistent sales slump and restore the company’s dominance in the highly competitive sportswear market.
• Hill, who returned to Nike after a three-decade career with the company, has pledged to refocus on sports-centric innovation and strengthen the brand’s core offerings.
• However, his task is compounded by significant missteps from his predecessor, John Donahoe, and mounting competitive threats that threaten Nike’s market position.

• We summarise the latest spreads and newsflow of merger arb situations we cover across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Philippines, Thailand and Chinese ADRs.
• Highest spreads: Seven & I Holdings (3382 JP), Get Nice Financial Group Ltd (1469 HK),  Arcadium Lithium (LTM AU), ESR Group (1821 HK), Goldlion Holdings (533 HK). 
• Lowest spreads: Lifestyle China (2136 HK), Renewable Japan (9522 JP), Macromill, Inc (3978 JP), Fuji Soft Inc (9749 JP), Nec Networks & System Integr (1973 JP). 

• The review period for the LQ45 Index January rebalance ended 31 December. The changes should be announced the last week of January, becoming effective after the close on 31 January.
• We highlight 4 potential inclusions and 4 potential exclusions for the index at the rebalance. The actual number of changes could be lower at 2-3 a side.
• Nearly all stocks will have over 1x ADV to trade from passive trackers if they are added to or deleted from the index.

• Alibaba’s Freshippo remained profitable and double-digit growth in the past nine months.
• Brazil labor authorities are investigating BYD’s construction site for “slave-like condition”.
• Tencent Music will compensate MCSC (Music Copyright Society of China) for the unauthorized usage of music copy rights.

• Bloks Group (1850960D CH) is looking to raise US$187m in its Hong Kong IPO.
• Bloks Groups (Bloks) operates in the toy segment where it primarily assembles character and brick-based toys.
• In our previous notes, we looked at the firm’s past performance. In this note, we undertake a peer comparison and discuss our thoughts on valuation.

• Water Oasis (1161 HK) skimped on its final dividend and paid only 2 HK cents (compared to our expectation of ~5 HK cents), sending its share prices down 14% post results.
• Insider buying after the results helped steady the shares, but we see that buying after the declaration of dividends as sending a wrong signal to some minority shareholders.
• There is immense value, trading at 4.4x PE and 0.3x EV-EBITDA, with 485 mn HKD net cash (~90% of the market cap), but we need increased dividends to crystallize it.

• In a dramatic turn of events, Hindenburg Research has publicly disclosed a short position against Carvana, intensifying the scrutiny on the online used-car retailer.
• The latest report from Hindenburg, titled “Carvana: A Father-Son Accounting Grift for the Ages,” accuses the company of financial manipulation and unsustainable growth driven by a precarious subprime loan portfolio.
• This revelation has sent ripples through the stock market, causing Carvana’s shares to dip by 1.9% in New York, marking a significant shift after a remarkable 284% surge in the previous year.

• MINISO Group Holding (9896 HK) has surged 34% since announcing strong 9M24 results, backed by robust revenue growth, in end November, 2024.
• With strong growth prospects, the stock could scale further in 2025, driven by rapid store expansion, blind box toys, ACG goods, and collaborations with top IPs like Harry Potter.
• MINISO’s evolution from a value retailer into a lifestyle brand with trademarked IP goods, innovative blind boxes, and creative retail formats enhances its competitive edge and drives growth.

• In early 2025, Tesla finds itself at a critical juncture as its global vehicle deliveries for 2024 dipped by 1% to 1.79 million units, marking the first annual decline in over a decade.
• Despite this setback, Tesla’s market capitalization surged by approximately 53%, positioning the company as a $1.2 trillion giant surpassing the combined value of the next 20 largest automakers.
• This paradox underscores a shift in Tesla’s valuation drivers—from traditional car sales to ambitious ventures in robotics, artificial intelligence, and the promising but uncertain robotaxi business.

• I tally 51 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
• One new deal was discussed this week: Sun Art Retail (6808 HK)‘s (expected) unconditional MGO. A Tsuruha Holdings (3391 JP)/Welcia Holdings (3141 JP) merger was also discussed. 
• Key updates/news took place on: AVJennings (AVJ AU),  GAPack (468 HK), Shandong Hi-Speed New Energy (1250 HK), Canvest (1381 HK), China Boqi Environmental (2377 HK), and HKBN (1310 HK).

• The phenomenon of declining numbers of listed shares due to share buybacks and declining numbers of listed companies in US/Europe starting in 1990s began in Japan 30 years later.
• On TSE, where there are many companies with parent-subsidiary listings and large shareholders like founder families and parent companies, more companies will choose to go private because of listing costs.
• Private equity investments in Japanese companies will further increase in the future, as it is easier to find investment opportunities in Japan, where stock valuations are relatively low.

• Tsuruha (3391 JP) and Welcia (3141 JP) may merge quicker than expected. Meaning a one-year “guess the price” ratio. Expect Tsuruha to gain against Welcia from here.
• PUSUs exist in Hong Kong. In its bid for GAPack (468 HK), XJF should sound out the SFC to put Bi/Hong on notice. 
• Canvest Environmental (1381 HK) effectively ticks off another pre-con. This transaction continues to trade too wide to terms. 

• On the 16th October, Li Ning-backed Viva Goods (933 HK)  announced a scrip Offer, by way of a Scheme, for 62.91%-held Bossini International Holdings (592 HK), a casual apparel play.
• One new Viva share for five Bossini shares backed an implied scrip price of HK$0.108/share, a 12.2% discount to undisturbed. 
• Bossini’s Scheme Doc is now out, with a Court Meeting on the 10th February, and expected  settlement on the 24th March. The IFA says “fair and reasonable”. 

• Thailand-based Freshket announced that it has raised an additional US$8 million funding round led by led by Thai President Foods or TFMAMA and Kliff Capital with continued support from existing investors, including Openspace and ECG Venture Capital.
• In a press statement, a TFMAMA spokesperson said that the company hopes to support Freshket through the provision of fresh and quality ingredients for the startup’s operations following this funding round.
• “We are currently expanding into new markets and customer segments while maintaining our existing customer base.

• Earth Venture Capital, a global climate tech firm backing deep-tech startups to decarbonise Emerging Asia, announced its participation in Mojave Energy Systems’ US$9.5 million Series A funding round.
• The investment, alongside the participation of Fifth Wall, At One Ventures, Myriad Venture Partners, Starshot Capital, and Alumni Ventures Group, raises Mojave’s total funding to US$25.6 million.
• In the next phase of innovation, Mojave plans to unveil ArctiDry HP, the first air conditioning system to integrate liquid desiccant technology with a reversible heat pump.

• Tri Pointe Homes’ (TPH) latest financial results for the third quarter of 2024 present a combination of robust performance metrics and strategic market positioning, alongside noted challenges in certain geographies and market segments.
• As a residential home builder operating across diverse U.S. markets, Tri Pointe achieved notable gains in home deliveries, revenue growth, and profitability, yet remains vigilant of macroeconomic and regional headwinds impacting future outlook.
• 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.

• An assurance system will be established to ensure the quality of assurance. The assurance provider is expected to be a profession-agnostic system that is not limited to auditing firms.
• The assurance will be limited to Scope 1 and 2, and only Scope 1 and 2, which most large companies already disclose, will be initially required to be disclosed.
• Scope 3 disclosures have not progressed at this time, but Scope 3 disclosures are expected to progress after the safe harbor is included and the disclosure guidelines are revised.

• HK$1.38/Share. That’s the takeaway as Alibaba Group (9988 HK) enters an SPA to offload its 78.7% stake in Sun Art (6808 HK) at HK$1.38/share, a 44.4% discount to last close.
• The buyer, Paragon Shine, an entity under Chinese PE outfit DCP Capital, is paying ~HK$12.3bn compared to BABA’s HK$28.1bn purchase of a 51% stake in October 2020.
• Should the SPA complete, an unconditional MGO is triggered. Minorities tendering can receive up to HK$1.58/share. But the question is: why would BABA be cashing out at this price?

• Shanghai-Based Bloks Group, a leader of assembly character toys in China, has announced the initial price range for its IPO in Hong Kong.
• The offering is expected to be between HK$55.65 and HK$60.35, implying a market cap of ~HK$14B or ~$1.8B at the midpoint of the price range. 
• Assuming IPO offer price of HK$58.00, UBS AM Singapore, Greenwoods AM and Fullgoal Investors have agreed to invest ~HK$388M or ~$50M in the offering.

• In this insight, we discuss numerous gap trade opportunities involving Korean preferred and common shares in 1Q 2025.
• Among the 27 major pair trades (prefs vs. common shares), 20 of the pref stocks outperformed their common shares counterparts in 2024.
• The 27 Korean preferred stocks’ average prices declined by 1% from end of 2023 to end of 2024 (excluding dividends), outperforming their common counterparts which were down on average 3.7%.

• Bloks Group (1850960D CH) is looking to raise US$188m in its Hong Kong IPO.
• Bloks Groups (Bloks) operates in the toy segment where it primarily assembles character and brick-based toys.
• In our previous note, we looked at the firm’s past performance. In this note, we discuss the latest PHIP updates.

• Adient plc has recently reported its fourth quarter 2024 earnings as well as its full-year results, providing a snapshot of the company’s current position and future outlook.
• The company’s performance was solid in the face of a challenging macroeconomic environment.
• Revenues decreased by 4% year-over-year, but Adient managed to maintain adjusted EBITDA at $235 million, highlighting its ability to mitigate customer volume headwinds through strong business performance.

• Kering is a luxury house similar to LVMH, with brands like Gucci, YSL, Bottega Veneta, and Balenciaga
• Gucci represents nearly 50% of Kering’s revenues and over 50% of profits, with its popularity tied to fashion trends
• Kering traces its history back to a diverse set of regional businesses before focusing on luxury under the leadership of Francois Henry Pinault

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• Samsonite is planning to re-list in the US, despite currently being listed in Hong Kong
• Company is trading at low valuation but expected to see medium-term growth
• Listing in Hong Kong has not benefitted Samsonite, with potential for increased interest and growth in the US market

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.

• Favorable reservoir level, an uptick in Kharif Harvest, and strong sowing for the Rabi season are expected to drive good demand for tractors in the medium term.
• We summarize the sales volume published by listed players Mahindra & Mahindra(M&M), and Escorts Kubota Limited.
• Positive management commentary augurs well for uptick in tractor OEM stocks and related auto ancillary companies like GNA Axles Ltd (GNA IN) in medium term.

• Steve Madden Limited’s results for the third quarter of 2024 reveal a mixed performance, characterized by notable achievements in certain areas and challenges in others.
• The company’s revenue increased by 13% compared to the third quarter of 2023, totaling $624.7 million.
• This growth was attributed to several factors, including exceptional performance in the accessories and apparel categories, profound contribution from the acquisition of Almost Famous, and strong top-line gains in international markets and direct-to-consumer channels.

• Shake Shack delivered a strong financial performance in the third quarter of 2024, showcasing positive trends and potential areas for caution.
• The company achieved its 15th consecutive quarter of positive same-Shack sales growth, with a 4.4% rise and a significant expansion in restaurant-level margins for the ninth consecutive quarter.
• This resulted in a 28% increase in adjusted EBITDA to $45.8 million.

• ITC Ltd (ITC IN) will demerge its Hotels business with the ex-date set as 6 January and shareholders receiving 1 share of ITC Hotels for 10 shares of ITC Ltd.
• ITC Ltd (ITC IN) shareholders will own 100% of ITC Hotels – 60% will be owned directly and 40% will be owned through their shareholding in ITC Ltd (ITC IN).
• There will be a lot of selling in ITC Hotels within a few days of listing from different passive index trackers and that could provide buying opportunities for those interested.

• Up to six Aussie stocks could be deleted from global passive portfolios in February. The final list of deletions depends on stock performance over the next 2-3 weeks.
• If deleted, passive trackers will need to sell between A$370m-A$500m in the stocks. Impact is high at between 7-24 days of ADV.
• The potential deletions have underperformed the S&P/ASX 200 (AS51 INDEX) over every time period from 1 week to 3 months. Positioning is still low in a few stocks.

• ITC Hotels is demerging with ITC Ltd (ITC IN) to create value for ITC shareholder and unlock value in hotel business.
• Record date for ITC Hotel demerger is 6-Jan-25 and listing can be done in 60 days after NCLT order i.e. 16-Dec-24.
• Discussed inclusion and exclusions of various Index including MSCI Emerging Markets Index (MXEF INDEX), FTSE and NIFTY Index (NIFTY INDEX) & S&P BSE SENSEX Index (SENSEX INDEX EQUITY).

• On 26 December, CVC extended its Macromill, Inc. (3978 JP) offer period by 10 business days to 17 January. The offer price remained unchanged, but it was not declared final.
• The extension is unsurprising as the shares have traded above terms for 30 out of 32 trading days. The emergence of Oasis as the largest shareholder is an added complication. 
• Lowering the minimum acceptance condition is not a viable option. A bump is increasingly likely. Trading patterns suggest a minimum required revised offer of around JPY1,200.

• HK$1.38/Share. That’s the key takeaway as Alibaba Group (9988 HK)  enters an SPA to offload its 78.7% stake in Sun Art (6808 HK) at HK$1.38/share, a 14.13% discount to undisturbed. 
• The buyer, Paragon Shine, an entity under Chinese PE outfit DCP Capital, is paying ~HK$12.3bn compared to BABA’s HK$28.1bn purchase of a 51% stake in October 2020. 
• Should the SPA complete, an unconditional MGO is triggered.  But the question is: why would BABA be cashing out at this price? 

• ITC Ltd (ITC IN) Hotels demerger aims to unlock the intrinsic value of the hotels business and enable a sharper focus on growth.
• ITC Hotels is aiming to reach a portfolio of 200+ hotels with 18,000+ keys by 2030 from a robust pipeline of 140 Hotels with about 13000 Keys in 2024.
• ITC Hotels inheriting a strong balance sheet with zero debt and cash reserves may list around 113-170 per share.

• In this insight, we discuss the alpha generation through companies that have been buying back their shares in the Korean stock market in November and December 2024.
• On average, the share buyback announcements for the 52 companies that announced share buybacks in Korea represented 2.2% of outstanding shares.
• Major companies that have announced share buybacks in Korea in the past two months include Celltrion, Samsung Electronics, Doosan Bobcat, and Hyundai Motor. 

• The most common example of poor disclosure is “Disclosure is merely a list of initiatives. The timing of achievement, numerical targets, necessary resources, etc. should be explained.
• Poor disclosure examples that “do not analyze issues or consider additional actions in a flexible manner” may not have a well-reasoned plan to disclose at this stage.
• It is clear that many companies are not sufficiently considering the reduction or withdrawal of unprofitable businesses, as evidenced by their low return on sales and return on capital.

• Our stock screen for textile/apparel companies listed in Hong Kong for FY24 summarizes the winners and losers. 
• Yue Yuen Industrial Holdings (551 HK) / JNBY Design Ltd (3306 HK) and Stella International (1836 HK) were the three best performers with returns of over 80% YTD.
• We continue to be bullish on JNBY Design Ltd (3306 HK) / Pacific Textiles (1382 HK) and like Nameson Holdings (1982 HK) for its rich dividend yield.

• Singapore-based flexible living platform Cove has announced a US$4.5 million funding round from existing investors, including Eurazeo and Keppel, along with Manchharam.
• The capital will fuel the startup’s regional expansion and transition to an asset acquisition model. This strategic shift will allow it to design and develop properties specifically tailored to the needs of its target market: young professionals and students.
• Cove’s expansion into South Korea and Japan is already underway, and the company has formed strategic joint ventures in both markets.