In today’s briefing:
- S&P/NZX 10 Index Rebalance: A2 Milk (ATM NZ) Replaces Ryman Healthcare (RYM NZ)
- Seven & I Holdings: Mega Share Buyback Plan and IPO of North American CVS Unit to Boost Share Price
- HSI Index Options Weekly (March 03-07): Alibaba’s Breakout and Policy Support Boost HSI
- [JD.com, Inc (JD US, BUY, TP US$52) Earnings Review]: Market Calls for Longer-Term Growth Drivers
- China Healthcare Weekly (Mar.9) – 11th VBP, PD-1/VEGF BsAb Outlook, MIXUE’s Stunning IPO Debut
- HSCEI Index Options Weekly (March 03-07): Strong Gains as Skew Signals Tail Demand
- (Mostly) Asia-Pac M&A: Oneconnect, Snt, Aeon Delight, AEON Mall, Insignia, 7&I, Sun Art
- Hasbro Inc.: Expansion in Self-Published Video Games to Drive Sustainable Long-Term Profitability!
- Wayfair Inc.: An Insight Into The 5 Biggest Challenges In Its Path In 2025!
S&P/NZX 10 Index Rebalance: A2 Milk (ATM NZ) Replaces Ryman Healthcare (RYM NZ)
- A2 Milk Co Ltd (ATM NZ) will replace Ryman Healthcare (RYM NZ) in the S&P/NZX 10 Index at the close of trading on 21 March.
- Passive trackers will need to buy 0.8x ADV in A2 Milk Co Ltd (ATM NZ) and will need to sell 1.2x ADV in Ryman Healthcare (RYM NZ).
- Importantly, A2 Milk Co Ltd (ATM NZ) is a deletion from a global index at the close on 21 March and the selling from those passive trackers is far larger.
Seven & I Holdings: Mega Share Buyback Plan and IPO of North American CVS Unit to Boost Share Price
- If indeed the company proceeds with 2 trillion yen buyback over five years, this would represent buyback of about 7.3% of its shares per year (37% of market cap).
- Seven & I Holdings’ plans to massively buyback shares and IPO its North American CVS business are major catalysts that should have positive impact both near and long term.
- Certainly, the company’s action plan to sell its non-core assets (including supermarket, restaurant, and specialty stores) to Bain Capital for $5.5 billion is a step in the right direction.
HSI Index Options Weekly (March 03-07): Alibaba’s Breakout and Policy Support Boost HSI
- Positive sentiment helps push HSI to new highs aided by rally in Alibaba.
- Implied vol at high levels but so far supported by historic vols that are above implieds.
- We highlight a large trade in out-of-the-money Calls for May expiry.
[JD.com, Inc (JD US, BUY, TP US$52) Earnings Review]: Market Calls for Longer-Term Growth Drivers
- JD C4Q24 revenue exceeded our estimate/consensus by 3%/4% and adjusted NI by 16%/19%, driven by subsidies and logistic efficiency gains.
- We expect JD to maintain 11% YoY revenue growth in C1H25 but moderate to 5.9% in 2H.
- We maintain JD.com’s TP at US$ 52 and the BUY rating. Market concern on lack of details for long term driver is valid but JD.com still has time.
China Healthcare Weekly (Mar.9) – 11th VBP, PD-1/VEGF BsAb Outlook, MIXUE’s Stunning IPO Debut
- The 11th national VBP is expected to start in 2025H1. Companies such as Kelun, CSPC, Qilu Pharmaceuticals, Fosun Pharma, China Resources Pharmaceutical, etc. are expected to be affected the most.
- It is estimated that the entire market of PD-1/L1 x VEGF BsAb is approximately US$20-30 billion. AK112 is expected to seize about 40%-50% of the market or US$8-15 billion.
- MIXUE’s IPO debut was stellar. Conservative investors can considering taking profits as risk of share price corrections has increased. Radical investors can choose to bet on valuation exceeding Nongfu Spring.
HSCEI Index Options Weekly (March 03-07): Strong Gains as Skew Signals Tail Demand
- HSCEI rebounded 5.90%, reversing last week’s weakness and extending its rally since mid-January.
- Volatility softened in the short term, with implieds trending below key historic vol measures.
- Skew shifted as demand for tail risk increased, with both out-of-the-money Puts and Calls seeing higher implied volatility, reflecting a bid for protection and upside exposure.
(Mostly) Asia-Pac M&A: Oneconnect, Snt, Aeon Delight, AEON Mall, Insignia, 7&I, Sun Art
- I tally 55 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma.
- Three news new deals discussed this week:Soundwill Holdings (878 HK), Oneconnect Financial Technology (6638 HK), Snt Corp (6319 JP), Aeon Delight (9787 JP), and AEON Mall (8905 JP).
- Key updates/news took place on: Insignia Financial (IFL AU), Seven & I Holdings (3382 JP), Sun Art Retail (6808 HK), and Macromill, Inc (3978 JP).
Hasbro Inc.: Expansion in Self-Published Video Games to Drive Sustainable Long-Term Profitability!
- Hasbro Inc. recently concluded its fourth-quarter and full-year 2024 earnings presentation, reporting on both achievements and challenges faced by the company.
- Notably, Hasbro’s diversified revenue streams, led by its Wizards of the Coast and Digital Games segment, underscore key factors in the company’s operational dynamics.
- While Hasbro achieved some significant financial milestones, certain segments faced headwinds, leading to mixed outcomes overall.
Wayfair Inc.: An Insight Into The 5 Biggest Challenges In Its Path In 2025!
- Wayfair’s fourth-quarter 2024 results reflect a mixed financial and operational landscape, capturing both opportunities and challenges in the current market environment.
- The company’s net revenue witnessed a slight increase, with the U.S. segment showing positive year-over-year growth at 1.1%.
- This growth was notably driven by improved holiday performance, implying effective seasonal management and merchandising strategies.
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