In today’s briefing:
- Appier (4180) | Q4 Preview; Valuation Re-Rating Likely
- Mediatek: A Lot of Good Things Ahead but the Stock Is a Bit Expensive
- PC Monitor: Latest Qualcomm & Mediatek Results Show ARM-Based Chips Disrupting the PC Market
- Qualcomm Q125. Firing On All Cylinders & An Ace Up Their Sleeve…
- Tam Jai Intl (2217 HK): Is It Privatisation or Takeover?
- Yum China (9987 HK): 2025 Outlook. Modest Growth and Margin Upside Amid Sector Headwinds
- Otsuka Holdings (4578 JP): Guidance Revised Upward for 2024, Core 2 Products Show Strength
- Kyodo Printing (7914 JP): Q3 FY03/25 flash update
- Axell Corp (6730 JP): Q3 FY03/25 flash update
- Forum Engineering Inc (7088 JP): Q3 FY03/25 flash update
Appier (4180) | Q4 Preview; Valuation Re-Rating Likely
- We forecast Q4 consolidated revenue of ¥9.7bn (+27% YoY); Operating profit (OP) is expected to grow +129% YoY to ¥1.0bn in Q4
- For FY25, we expect the company to guide for +25% revenue growth and OP +160% to ¥5.7bn, significantly ahead of the street estimate of ¥4.8bn.
- Appier’s AI-powered solutions operate on top of generative AI models, utilizing proprietary data and analytics to enhance corporate online advertising efficiency.
Mediatek: A Lot of Good Things Ahead but the Stock Is a Bit Expensive
- Smartphone revenues increased by 31% in 2024 and will increase by 15-20% in 2025 in my view: small volume growth (5%), ASP increase (AI in chips), share gains in premium.
- MTK multiple bets in Automotive, AI, ARM CPU are starting to pay off. Nvidia GB100 revenues mid-25, AI Accelerator revenue start mid-26, Nvidia Auto revenue in 2H26 – my estimates.
- Consensus forecasts revenues increasing +35% from 2024 to 2026, Net Income +30%. That should be the low-end of the range. The stock is trading at 21.1x 2025 EPS, 17.6x 2026.
PC Monitor: Latest Qualcomm & Mediatek Results Show ARM-Based Chips Disrupting the PC Market
- Growing Signs That ARM-Based Chips Are Set to Disrupt the PC Market
- Qualcomm’s Earnings Call Insights — Snapdragon’s ARM-Based Push into PCs Successfully Taking Significant Market Share
- Mediatek Earnings Call Highlights — Reiterates ARM-Based Entry into PC Market with AI Supercomputer CPU in Collaboration with NVIDIA
Qualcomm Q125. Firing On All Cylinders & An Ace Up Their Sleeve…
- Q125 revenues of $11.7 billion, up 18% YoY, up 15% QoQ and marginally above the high end of the guided range. This represented the company’s highest ever quarterly revenue
- In December, Snapdragon X Series had more than 10% share of the greater than $800 Windows laptops in U.S. retail.
- A recent hire suggests Qualcomm has an ace up their sleeve and that they are poised to launch yet another diversification gambit
Tam Jai Intl (2217 HK): Is It Privatisation or Takeover?
- Tam Jai Intl (2217 HK)‘s suspension has led to speculation about a privatisation or takeover. Its huge net cash, equal to 115% of market capitalisation, makes it appealing.
- Its controlling shareholder Toridoll Holding Limited owns a 74.61% stake and there is no shareholder with more than a 5% interest. This makes a deal seemingly simple.
- Assuming priced at the average P/B of 1.63x, this means HK$1.90, or 110% premium to the latest close, which is costly to the major shareholder.
Yum China (9987 HK): 2025 Outlook. Modest Growth and Margin Upside Amid Sector Headwinds
- Yum China Holdings (9987 HK) posted robust year-over-year operating profit growth in 4Q2024 on the back of low single digit sales increase and operating efficiencies.
- Despite significant sector headwinds, Yum China has managed to outperform peers and grow ahead of sector in 2024 by swiftly adapting to shifting consumer preferences.
- Yum China’s value-for-money QSR model with mid-tier pricing amidst tough sector outlook implies limited margin upside, a likely single-digit sales growth outlook, and a modest dividend yield for 2025.
Otsuka Holdings (4578 JP): Guidance Revised Upward for 2024, Core 2 Products Show Strength
- Otsuka Holdings (4578 JP) has revised revenue guidance for 2024 to ¥2,320B from previous ¥2,310B. Pharmaceutical business and nutraceutical business performed strongly.
- 2024 operating profit guidance have been revised slightly upwards to ¥323B. Due to the impact of temporary tax adjustment in U.S., net profit guidance raised by 43% to ¥343B.
- Otsuka shares have rallied 40% in the last one year. With multiple growth drivers at play Otsuka is poised for accelerated growth.
Kyodo Printing (7914 JP): Q3 FY03/25 flash update
- Revenue increased by 4.4% YoY to JPY75.1bn; net income rose 86.3% YoY due to investment gains.
- Publishing printing revenue declined YoY; operating loss narrowed by JPY138mn YoY, but price pass-through was slower than expected.
- Revenue from business forms rose 8.8% YoY; operating profit exceeded expectations due to cost reductions despite weak BPO performance.
Axell Corp (6730 JP): Q3 FY03/25 flash update
- Sales decreased by 13.6% YoY to JPY11.9bn, with operating profit and recurring profit declining by 38.7% and 37.5% respectively.
- Pachinko and pachislot machine market showed deceleration; company focused on AI business expansion and graphics LSI sales.
- New Businesses segment reported an operating loss of JPY377mn, with sales declining by 8.1% YoY to JPY340mn.
Forum Engineering Inc (7088 JP): Q3 FY03/25 flash update
- Revenue increased by 10.9% YoY to JPY26.1bn, driven by higher demand for temporary engineers and staffing rates.
- Cumulative Q3 pre-tax profit rose 43.3% YoY to JPY3.5bn, with significant contributions from Cognavi Staffing and staffing rate increases.
- Cognavi India recorded JPY15mn revenue and JPY279mn operating loss in cumulative Q3 FY03/25 due to upfront investments.
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