Consumer: Mazda Motor, Cisarua Mountain Dairy, Honda Motor, Yamaha Motor, Leapmotor, Inter Parfums, Tuesday Morning, Fast Fitness Japan Inc, Monogatari Corp, Relaxo Footwears and more

• Despite supply chain and material cost headwinds Mazda beat consensus FY OP estimates by 15% despite being in-line on revenue. 
• Guidance was also 17% above consensus but we think both should be ignored because guidance is being sandbagged and consensus remains clueless. 
• We expect sales volumes to beat Mazda’s guidance slightly and for OP generation to be ¥240-300bn rather than ¥120bn.

• Leading dairy and premium foods player Cisarua Mountain Dairy continued to demonstrate its resilience during 1Q2022 despite some omicron disruption, and rising pressure from raw materials.
• Growth will be driven this year through capacity expansion and a focus on expanding distribution channels, especially through general trade and Miss Cimory MCM. 
• Management remains confident in the growth outlook and will potentially raise prices in 3Q2022 to offset inflationary pressures although powdered milk prices have already stabilized. Top consumer staples pick.

• Honda 4QFY22 was mixed with revenue of ¥3,876bn (-0.7% vs. consensus) and OP of ¥200bn (+33.1% vs. consensus). 
• The company’s FY23 guidance was weak projecting just ¥16,250bn (-2.2% vs. consensus) in revenue and OP of ¥810bn (-15.1% vs. consensus). 
• Those numbers are laden with Honda conservatism, but we nevertheless foresee smaller potential beats by Honda than for peers.

• Yamaha Motors’ stock crashed 9% after a poor quarterly report
• However, there were a number of temporary issues impacting costs in the quarter. Management reiterated its guidance for the full year
• Given that demand for its marine engines and motorbikes remains on track, we think the stock is too cheap, trading below book value 

• Leapmotor (LM) aims to raise around US$1bn in its Hong Kong IPO. LM is a smart EV company based in China, founded in 2015.
• It focuses on the mid- to high-end segment in China’s NEV market with a price range of RMB150,000-300,000. As of end FY21, it had delivered a total of 52,832 cars.
• In this note, we talk about the positive aspects of the deal.

• IPAR reported strong demand for its fragrances in the first period even though the US Dollar strengthened against the Euro
• The first quarter performance was at the onset of the weakening of the Euro, but IPAR’s management asserted there has been no sign of demand abating
• IPAR’s stock has continued to underperform our expectations even though consensus estimates call for sales and earnings growth

• TUEM reported fiscal third quarter (March) results depicting how its business model looks when sales slowdown.
• The softness in sales was combined with TUEM getting full order placement from vendors when completion rates were running less than 70 percent in prior quarters
• TUEM announced a credit facility of $110 million, providing ample liquidity and flexibility heading into the holiday shopping season. It also removes one of the biggest overhangs on the stock

• On May 13, Fast Fitness Japan (7092, the company) announced FY3/22 results. Sales were 13.097bn yen (+17.3% YoY), and OP was 2.946bn yen (+28.4% YoY)
• The company’s FY3/23 guidance is for sales of 14.0bn yen (+6.9% YoY) and OP of 3.0bn yen (+1.8% YoY)
• The company announced its mid-term plan targets for FY3/25. The company aims for 18 bn yen in sales, 4bn yen in OP, and 1,400 stores

• Same-store sales for company-owned stores were 123.9% vs. April 2021 (108.1% for March), 743.9% vs. April 2020 (93.9% for March), and 102.7% vs. April 2019 (91.3% for March)
• Sales have been strong, as operating restrictions were lifted in late March. In particular, the Yakiniku division (Japanese BBQ) performed much better than in the pre-pandemic period
• The number of domestic company-owned stores at end of April was 365 (+5 MoM, +25 vs. end FY6/21).

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