Daily Briefs

• Zensho Holdings (7550 JP) has had a great couple of years in share price movement. And this year is seeing earnings explode to new highs. M&A and FX.
• Now they want to build a “war chest” equivalent to 4% of market cap to go do more M&A. 
• This seems opportunistic. And the shareholder register is extraordinarily lopsided. There is really only one buyer for this deal.

• We are positive on Orion Corp. Regardless of the overall market movement next year (up or down), we believe Orion Corp could outperform KOSPI in the next 6-12 months.
• The company has millions of loyal customers in major overseas countries including China, Russia, and Vietnam. Despite difficult operating conditions, Orion continues to generate stable growth in sales and profits.
• Orion Corp’s valuations are attractive. Orion Corp is currently trading at 2024E EV/EBITDA of 4.4x (42% lower than average valuation multiple from 2019 to 2023).

• We expect Meituan to report C3Q23 top line, non-GAAP operating profit and GAAP net income 2%, 4% and 20% vs. consensus. Our C4Q23 estimates are 6%, 19%, and 30% …
• Douyin’s in-store GMV growth decelerated in September/October, per local media. We believe there are two main causes, (1) local life’s share of Douyin video views is around 10%~, which…
• Douyin’s next threat to Meituan is food delivery, but GMV is less than 1% of Meituan food delivery in 3Q, we estimate. At the current trajectory, we expect Douyin…

• A company visit with Sumber Alfaria Trijaya revealed confidence in the outlook with its more aggressive store expansion on track, as it nearly draws level with Indomaret.
• The company remains focused on expanding its Lawson convenience store outlets plus larger size Midi outlets. Its membership scheme is growing fast with 10m shopping once a week. 
• Sumber Alfaria Trijaya (AMRT IJ) remains a core retail holding, with its premium valuation justified by its strong growth prospects, with estimated 2-year Forward EPS growth of +25% and +17%. 

• EM Fund ownership in JD.com continues to fall. Average weights slip to 4-year low as managers close out in large numbers.
• Between February 2023 and October 2023, there were 56 closures versus 6 openings in JD.com, led by managers at the growth end of the spectrum.
• Despite this, JD.com is still the 16th most widely held stock globally, with combined AUM among the funds in this analysis of $1.27bn.

OPAP’s Q323 results were negatively affected by industry-wide influences in sports betting, a tough comparative for Lotteries, and one-off natural events, which have led to a minor, c 3%, tweaking to management’s prior FY23 EBITDA guidance. From an operational perspective, the new iLottery platform is building awareness and growing revenue, and player activity increased on the OPAP Store app, while the retail offer continues to evolve.

4imprint’s Q323 trading update indicated further good growth, albeit moderating against comparatives getting tougher as the year progresses. Full year revenue guidance is maintained at ‘slightly above’ $1.3bn, with continuing high returns on marketing spend prompting a $5m uplift in PBT guidance to ‘not less than $130m’. 4imprint’s underlying markets reflect US corporate economic health, with any downside mitigated by the prospect of carrying on building market share as less well-funded firms struggle. Already the largest North American distributor of promotional products, 4imprint’s market share in H123 was just 5.9%, giving plenty to go for. The long-term growth record, strong cash generation and robust balance sheet underpin the rating.