In today’s briefing:
- Toyota Industries (6201 JP): Thoughts on Intrinsic Value
- MINISO (9896 HK)’s (Possible) TOP TOY Spin-Off Is Priced In
- Foshan Haitian Flavouring A/H Listing – Strong Cornerstone, Weak Momentum
- No Visa For Group Tour Visitors from China to South Korea Likely Starting 3Q 2025
- Quiddity Leaderboard HSCEI Sep25: One Change Likely; US$245mn One-Way Flow
- Shinsung Tongsang (005390 KS): The Family Reloads At ₩4,100/Share
- Foshan Haitian Flavouring (3288 HK) IPO: The Valuation Perspective
- Foshan Haitian Flavouring H Share Listing (3288 HK): Valuation Insights
- JD.com (9618 HK): Top Trades and Strategic Insights from HKEX Options Trading
- Isetan Shinjuku Takes 24% of Tokyo Market but Worries for Future
Toyota Industries (6201 JP): Thoughts on Intrinsic Value
- Several investors have sharply criticised Toyota Industries (6201 JP)’s preconditional tender offer from Toyota Fudosan. Oasis is pushing for a higher offer.
- The offer has several issues that are detrimental to minorities’ interests. The key grievance is that it is below TICO’s intrinsic value.
- Due to TICO’s varied business units, SoTP valuation is the most appropriate methodology. My analysis suggests a base case intrinsic value of around JPY19,000.
MINISO (9896 HK)’s (Possible) TOP TOY Spin-Off Is Priced In
- Three months ago, local media reported that Chinese lifestyle retailer MINISO Group Holding (9896 HK) was considering spinning off its collectible toy unit TOP TOY on the Hong Kong exchange.
- Reportedly, MINISO could raise ~US$300mn from an IPO. MINISO has now confirmed that a spin-off is being contemplated; although a proposal is only at a preliminary stage.
- TOP TOY has been a growth engine. But its contribution to the group is still ~6%. Applying a holding company discount, post spin-off, MINISO’s upside appears limited.
Foshan Haitian Flavouring A/H Listing – Strong Cornerstone, Weak Momentum
- Foshan Haitian Flavouring & Food (603288 CH) (FHCC), China’s leading condiments company, aims to raise around US$1.2bn in its H-share listing.
- FHCC is China’s leading condiments company within its main product categories of soy sauce, oyster sauce, flavored sauce, specialty condiment products and other products.
- We have looked at the past performance and likely A/H premium in our previous note. In this note, we talk about the IPO pricing.
No Visa For Group Tour Visitors from China to South Korea Likely Starting 3Q 2025
- In the next several weeks, the South Korean government is likely to provide details of a no visa policy for group tour visitors from China to South Korea.
- We provide a list of top 15 Korean companies that could benefit from potential no visa policy for group tour visitors from China to South Korea.
- These 15 companies’ share prices are up on average 49.2% YTD, sharply outperforming KOSPI and KOSDAQ that are up 21.2% and 15.9%, respectively YTD.
Quiddity Leaderboard HSCEI Sep25: One Change Likely; US$245mn One-Way Flow
- The HSCEI serves as a benchmark to reflect the overall performance of the top 50 “Mainland China” securities listed in Hong Kong.
- In this insight, we take a look at the potential index changes and capping flows for HSCEI index rebal event in September 2025.
- Based on the latest data, we see one ADD and one DEL.
Shinsung Tongsang (005390 KS): The Family Reloads At ₩4,100/Share
- Back June last year, Yeom Tae-soon and family sought to take apparel manufacturer Shinsung Tongsang (005390 KS) private at ₩2,300, but fell short of the 95% delisting threshold.
- The family have returned to the well with a more respectable ₩4,100/share Offer, a 35.8% premium to undisturbed, and optically, a fair price. The family and related parties hold 83.87%.
- Should the family fall short of the 95% threshold, again, they may seek delisting through a comprehensive stock exchange.
Foshan Haitian Flavouring (3288 HK) IPO: The Valuation Perspective
- Fundamentals first, Foshan Haitian Flavouring & Food Company (3288 HK)‘s IPO is interesting given a positive growth outlook – 1Q25 growth accelerated to 14.8% with margin expansion.
- We value the H-share at HK$39.35, 8.4% higher than the high-end of the IPO price based on 28.2x FY25F PER to reflect its significantly stronger 3-year earnings growth.
- It equals 5.9x pre-money FY25F P/B, justified by ROE of 21.8-22%, sharply ahead of peers. Net cash equals 12.4% of its A-share market cap.
Foshan Haitian Flavouring H Share Listing (3288 HK): Valuation Insights
- Foshan Haitian Flavouring & Food Company (3288 HK) has launched its H Share listing at HK$35.00 to HK$36.30 per H Share. Pricing will be on 17 June.
- I discussed the H Share listing in Foshan Haitian Flavouring H Share Listing: The Investment Case.
- The proposed AH discount can be argued as either light or attractive. I lean toward the latter and would participate in the H Share listing.
JD.com (9618 HK): Top Trades and Strategic Insights from HKEX Options Trading
- Discover sophisticated, live, multi-leg options strategies on JD.com (9618 HK), executed over the period from 4 June to 10 June on the HKEX
- Highlights: A range of noteworthy strategies, including a deep in-the-money, three-months Diagonal Call Spread and an ultra-low-cost, one-week Calendar Put Spread, highlighting diverse approaches to capitalize on market movements.
- Why read: This breakdown of complex option strategies sheds light on market sentiment and positioning. Detailed examples provide actionable insights that could inspire similar strategies,
Isetan Shinjuku Takes 24% of Tokyo Market but Worries for Future
- Department stores had a terrific year in FY2024, especially some of the more iconic stores like Isetan Shinjuku and Hankyu Umeda.
- Declining custom from tourists is beginning to be a worry but the emphasis on capturing data on core local customers has, and will, pay big dividends for the best stores.
- The rest of the sector however, will continue to contract but the polarisation will help highlight the luxury positioning of the best stores.
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