In today’s briefing:
- StubWorld: Swire Accelerates Cathay Exchange. “As” At Multi-Decade Premium To “Bs”
- SHEIN (625 HK): Round-Trip to Flat on IPO Debut; 95% Locked Up; Accumulate at HK$43–49, FV HK$70
- Kadoya (2612 JP): Evaluating a Potential Privatisation
- Water Oasis: Six Years Later, the Value Trap Never Arrived
- Lottomatica/CIRSA: An Excessive Acquirer Sell-Off
- Companies with Major Shareholders Holding over 40% Stake Account for 30% of All Listed Companies
- Haier Smart Home (6690 HK): No Fireworks for Now; Searching for Growth Everywhere
- Watches of Switzerland (WOSG LN): Synthetic Expert Call Transcript (02 Sep 2026)
- Dream International (1126 HK) H1FY26 Concall Gleanings: Cost Shock Masks A Record Top Line
- 2026 Buyback Consideration Surpasses S$2 Billion
StubWorld: Swire Accelerates Cathay Exchange. “As” At Multi-Decade Premium To “Bs”
- Via an accelerated exchange, Swire Pacific (19 HK) is soliciting tenders from its 2027 exchangeable bond holders and, in parallel, placing Cathay (293 HK) shares to fund the bond repurchase.
- Preceding my comments on Swire, are the current setup/unwind tables for Asia-Pacific Holdcos.
- These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation >20%.
SHEIN (625 HK): Round-Trip to Flat on IPO Debut; 95% Locked Up; Accumulate at HK$43–49, FV HK$70
- SHEIN’s round-trip debut to flat is a float signal, not a price signal. With 95% of shares locked up, near-term price action reflects flow, not fundamentals.
- Three post-listing developments reset the risk picture: a US$494m earnings reversal, France’s live garment levy, and a US$3.5bn recapitalisation outflow.
- ACCUMULATE, FV HK$70 (US$38bn) on ~0.9× LTM EV/Sales — a H&M-level discount reflecting tariff drag, governance concentration, and a 5% free float.
Kadoya (2612 JP): Evaluating a Potential Privatisation
- Mergermarket and Nikkei reported that Kadoya Sesame Mills (2612 JP) is considering taking its shares private to enhance its corporate value in the medium- to long-term.
- The likely offer structure is a Mitsubishi Corp (8058 JP)-led TOB to gain strategic control (distribution exclusivity, supply-chain integration). Mitsui & Co Ltd (8031 JP) is likely to exit.
- Kadoya has materially outperformed its peers over the past 12 months, thereby capping the takeover premium. I estimate an offer of JPY1,950 to JPY2,510.
Water Oasis: Six Years Later, the Value Trap Never Arrived
- Beauty services now exceed 90% of revenue, validating the service-led thesis while recent growth suggests the model is still economically relevant.
- Our concerns around moat, disclosure and management remain partly valid, but the accounting deterioration and value-trap outcomes we feared never materialized.
- The biggest lesson is valuation: Water Oasis did not need to become exceptional; it only needed to remain durable enough at a deeply discounted price.
Lottomatica/CIRSA: An Excessive Acquirer Sell-Off
- Lottomatica is down 9.2% following the CIRSA merger announcement, erasing ~€575m of equity value; we believe the sell-off overstates the transaction cost.
- CIRSA is acquired at ~6x 2026E EBITDA before synergies, versus Lottomatica’s 8.0x unaffected NTM multiple, with €115m of annual pre-tax cash synergies.
- At €22.49, Lottomatica trades at ~7.45x NTM EBITDA. We would buy the sell-off: the current de-rating gives too little credit to the acquired earnings and synergies.
Companies with Major Shareholders Holding over 40% Stake Account for 30% of All Listed Companies
- The disclosure rules begin as a compromise in response to concerns regarding the burden on listed companies and investor needs. However, it remains unclear what impact these rules will have.
- Since there are so many companies with major shareholders,this means that while there are challenges regarding trading liquidity, there are also many investment opportunities.
- Institutional investors are expected to discuss with the company the future direction of its listing in a way that promotes the sustainable growth of minority shareholders’ interests.
Haier Smart Home (6690 HK): No Fireworks for Now; Searching for Growth Everywhere
- No Fireworks: In this insight we discuss about Haier Smart Home (6690 HK) ‘s H1 FY2026 financial performance and why there were no fireworks.
- Searching for Growth Everywhere : Given the weak demand in its domestic market, the company is searching for growth in every geography globally.
- Finally, we discuss and conclude our view on H2FY2026 performance of the company.
Watches of Switzerland (WOSG LN): Synthetic Expert Call Transcript (02 Sep 2026)
- LBO Contractual Blocker: Despite Watches of Switzerland Group (WOSG) maintaining a highly clean leverage profile of 0.3x net debt to EBITDA with £57.0 million in net debt, a private equity-backed LBO is structurally constrained by change-of-control clauses in Rolex and Patek Philippe agreements, which allow unilateral termination of distribution rights upon ownership transfer.
- Rolex-Bucherer Vertical Consolidation: The Rolex-Bucherer acquisition, cleared by European regulators without conditions in July 2024, has structurally shifted the luxury watch retail landscape, driving a transition to mono-brand boutiques managed by the manufacturer and squeezing third-party multi-brand distribution margins.
- US Working Capital and Margin Dilution: While US expansion pushed North America to over 51% of group revenue in FY26, this shift requires substantial capital tied up in slow-moving non-Rolex inventory and lower-margin luxury jewelry, diluting historical group ROIC down to 18%.
Disclaimer: The following transcripts are synthetic, AI-generated on demand, and compiled exclusively from public data sources; no real-word experts were actually interviewed. This content is designed to highlight potential market mispricings, explore compelling lines of inquiry, and suggest strategic questions rather than present verified facts. All specific financial metrics and data points, including market shares, TAM, margins, and growth rates, are AI-estimated approximations. They may be inaccurate and must be independently verified.
Dream International (1126 HK) H1FY26 Concall Gleanings: Cost Shock Masks A Record Top Line
- Revenue rose 12.3% to HK$2,896.5m on record plush volumes, but material and Vietnamese labor cost inflation cut gross margin 470bp to 15.4%.
- Net cash of HK$1,406m, 30% of market capitalization, and a flat HK$0.25 interim dividend underpin the payout, while margin repair remains unproven.
- Valuation is appealing at 6.9x P/E, 3.2x EV/EBITDA, 1.0x P/B, 9.0% yield, 15.2% ROE.
2026 Buyback Consideration Surpasses S$2 Billion
- Over 70 SGX primary-listed companies repurchased S$2.09 billion in shares in 8M26, up from S$1.57 billion in 8M25.
- Singtel led with S$948.6 million in buybacks, aiming for a 3% EPS accretion through its S$2 billion programme.
- Seatrium’s buybacks reached S$99.7 million, nearing full deployment of its S$100 million programme since 2024.
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