ConsumerDaily Briefs

Consumer: Sony Corp, Alibaba Group, LG Energy Solution, ITC Ltd, Netflix Inc, Hindustan Unilever, S Hotels & Resorts PCL, Minda Industries Ltd and more

In today’s briefing:

  • Sony (6758 JP) | Master of the Metaverse
  • Alibaba (9988 HK): Well Controlled Expense in 4Q22 and Forthcoming Turning Point in June, Buy
  • Sony – IR Day One and Kadokawa
  • LG Energy Solution: Short-Term Flow Crunch & Block Deal Possibility
  • ITC Ltd (ITC IN) | A Good Place to Hide
  • Tidefall Capital Management Q1 2022 Letter
  • Hindustan Unilever (HUVR IN) | The Right Priorities, but Ain’t Enough
  • SHR: Operations to Regain Momentum in 2H22
  • Minda Industries – EBITDA Tops Estimates; Outlook Remains Intact
  • Minda Industries: Robust Performance

Sony (6758 JP) | Master of the Metaverse

By Mark Chadwick

  • Sony’s hosted its 2022 Corporate Strategy Meeting last week. Our key takeaway is that SONY is shifting towards greater investment in Content, Creators, and Communities.  
  • Sony recognizes that technology is changing the way that content is produced and consumed and is responding with new experiences and monetization models.  
  • Sony will continue to benefit from the evolution of the internet as it becomes more social, immersive and financialized (otherwise known as the metaverse). 

Alibaba (9988 HK): Well Controlled Expense in 4Q22 and Forthcoming Turning Point in June, Buy

By Ming Lu

  • Operating margin improved in 4Q22 due to well controlled expenses in minor businesses.
  • We believe the state council meeting will provide a turning point in June.
  • We set an upside of 31% and a price target at HK$106.

Sony – IR Day One and Kadokawa

By Mio Kato

  • Sony held the first of their two investor days yesterday presenting on the Game & Network Services, Music and Pictures segments. 
  • While there was nothing especially new for those paying attention to the broad flow of news conditions for the content businesses remain strong. 
  • What was interesting to us was the degree of collaboration with Kadokawa.

LG Energy Solution: Short-Term Flow Crunch & Block Deal Possibility

By Sanghyun Park

  • LG Energy Solution’s real-world free-float rate should be around 5%, or 12.3M shares. We will see two additional passive inflows with the real-world float this tight.
  • KOSPI 200 up-weight and FTSE June QIR New Entry’s combined inflow will be 0.6% of SO, enough for us to expect a short-term flow crunch.
  • Then, there will likely be a share let-go event (block deals) by LG Chem to lessen the tight float situation, just like what KSOE had done for HHI.

ITC Ltd (ITC IN) | A Good Place to Hide

By Pranav Bhavsar

  • ITC Ltd (ITC IN) ‘s core cigarette portfolio is relatively inelastic to the current commodity inflation. With the reopening of offices and social events, volumes are likely to trend higher. 
  • A renewed focus on FMCG is likely to aid volumes for the non-cigarette segment. 
  • Valuations are in favor and we see limited scope for de-rating if not re-rating.

Tidefall Capital Management Q1 2022 Letter

By Fund Newsletters

  • Tidefall is a concentrated, unconstrained investment fund that attempts to compound its capital at an attractive rate of return. Our investment advantage comes from our in-depth research, long-term time horizon and appreciation of biases.
  • With Netflix stock down by more than 50% since its high in November (and 10% below Reed Hastings’ $20m purchase in January) we re-entered the position in April.
  • We believe the current price of Netflix shares creates a compelling long term investment opportunity.

Hindustan Unilever (HUVR IN) | The Right Priorities, but Ain’t Enough

By Pranav Bhavsar

  • Hindustan Unilever (HUVR IN) is focusing on protecting its business model and market share, which is the key in such an operating environment. 
  • Presence across multiple price points and playing a targeted game in target geographies will aid in maintaining steady-state growth. 
  • Current valuations, lack of trigger for driving exponential volume growth and expected slowing pace of premiumisation warrant caution. 

SHR: Operations to Regain Momentum in 2H22

By Pi Research

  • Analyst meeting came out with a positive tone regarding 2022 outlook.We maintain BUY rating  while roll out the new 2023 TP of Bt4.8 (+7% from previous TP),pegged to 1x PBV’23E.
  • We expect  its 2022 EBITDA to grow 4 times, in-line with management target with 61% growth in revenue backed by global tourism recovery.
  • UK portfolio will grow steady from a dull 1Q22 performance owing to low season and will ramp up to pre-Covid levels by the end of2022 while Maldives portfolio will enter 

Minda Industries – EBITDA Tops Estimates; Outlook Remains Intact

By Emkay

  • EBITDA tops estimates: Revenue grew by 8% yoy to Rs24.2bn (est.: Rs23.7bn), slightly above estimates.
  • Order wins continued in Q4FY22: 1) Received orders for new generation switches for sunroof, cruise control, paddle and vehicle stability from PV OEM and export orders from an Italian 2W OEM;
  • Retain Buy with a TP of Rs1,135. MNDA is focusing on strengthening its own R&D capabilities and exploring tie-ups and acquisitions with a focus on PACE opportunities (Personalization, Autonomous, Connected and Electrification).

Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.


Minda Industries: Robust Performance

By Axis Direct

  • Minda Industries Ltd. (MIL) reported a strong set of results (slightly ahead of our estimates) despite a tough operating environment.
  • MIL posted a robust revenue growth led by an increase in content per vehicle, addition of new customers and products, and growth across segments as well as due to the ramp-up of new order wins
  • We maintain our BUY rating with a revised target price of Rs 1,100/share (Rs 1,250 earlier), valuing the stock at 32x FY24E EPS, indicating an upside of 32% from the CMP.

Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.


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