Daily Brief Equity Bottom-Up: StubWorld: DFI Exits Robinson Retail and more

• Jardine Matheson (JM SP)‘s 77.8%-held DFI Retail Group (DFI SP) has sold its entire 22.2% stake in Robinsons Retail Holdings (RRHI PM) for ~US$283mn to “support its capital allocation strategy“.
• Preceding my comments on Matheson 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%.

• In 1Q25, total revenue grew by 47% YoY with home appliance up by 59% YoY.
• Both home appliance and electric vehicle will expand their capacities.
• The stock has an upside of 29% and a price target of HK$66 for the next twelve months.

• A N3 wafer costs US$20k. Taiwan news mention N2 price at $30k, 16A at $45k. That’s a bit inflated but price increase at each node will be a hefty ~30-40%. 
• It will become difficult for PC, Smartphone to absorb a US$40k wafer cpst, or to use the chip’s performance in these devices. The addressable market will shrink: AI, Networking, Server. 
• TSMC’s growth will come more from wafer price increase than from volume growth. It’s already the case! Could be a problem for Semi Production Equipment vendors: scale will be smaller.

• IDC has revised down 2025 Smartphone unit growth from 2.3% to 0.6%; increased PC from 3.7% to 4.5% but expects a decline in 2026. 
• The positive for Mediatek is AI in Mobile chips, but it’s a secondary driver compared to AI ASIC design. Mediatek stock is more expensive than TSMC despite lower visibility.
• I don’t see any stock for which PC is a positive. The risk remain over-estimating replacement demand ahead of Windows 10 end-of-support in Oct-25.

• Xiaomi reported C1Q25 top line, non-IFRS operating income and IFRS net profit 2.0%, 41% and 57% vs. our estimate. 
• While there are a few product positives supporting outperformance, the main driver is still trade-in subsidy (TIS), which will start to end in C3Q25;
• We continue to view Xiaomi as having an enviable market position as a “Huawei without the sanctions”, its valuation has also become very rich.

• We expect the Trump tariffs announced on Taiwan (base for suppliers/production of Plover Bay) to slightly affect growth rates for H1 FY25 and estimate a 15%/13% YoY revenue/profit growth number. 
• A 32% tariff was imposed on Taiwan suppliers; however, electronic items, including routers, were subsequently excluded. Nonetheless, overall business sentiment had already been negatively impacted before these adjustments.
• Trading at 19.4x FY25e earnings (assuming a reversion to 15% growth), the stock is somewhat fairly valued, although we love this name’s execution and long-term track record. 

• VEON last week announced it has secured regulatory approvals for its tower asset partnership with Engro Corp in Pakistan, unlocking US$563 million in value. 
• Cash portion of funds will be paid in tranches and received in Pakistan, with flexibility to upstream capital or reinvest locally.
• Transaction supports VEON’s ongoing transformation at the Group level and digital growth strategy in Pakistan while offering a roadmap for similar value creation in Ukraine.

AFT Pharmaceuticals reported FY25 revenues of N Z$208m, posting a strong recovery in H2, with dissipating headwinds and traditional H2 seasonality offsetting the softer H1 performance. H225 revenues (N Z$121.3m) grew 40% over H125 and 9% y-o-y, driven by sustained domestic market momentum and international market recovery. The FY25 operating margin of 8.5% (12.4% in FY24) was affected by lower licensing income and investments in marketing, R&D and international expansion, but these investments should deliver upside opportunities in the longer term. The balance sheet remains strong (net debt reduced to N Z$14.5m, 0.7x EBITDA), supporting the announcement of a 1.8c per share dividend (c 17% payout ratio). Management aims to achieve N Z$300m in revenues by end-FY27 and has guided for operating profit of N Z$20–24m in FY26, with increased operating leverage in the medium term. We update our valuation for AFT to N Z$691.4m or N Z$6.59/share, from N Z$697.4m or N Z$6.65/share previously.

• Eurasia Mining joined AIM in 1999 as a Russia-focused metals and mining company.
• Initially in a JV with Anglo Platinum, the company undertook extensive exploration (gold, gold-copper & PGMs) in the Urals and the Kola Peninsula, which led to the West Kytlim and Monchetundra discoveries that Eurasia went on to acquire.
• The company has successfully advanced battery metals and hydrogen metal mines into production in the Russian Arctic.

• Q4 FY3/25 results showed OP margin improvement YoY (Q4 FY3/24 6.1%, Q4 FY3/25 6.3%) as both DH Group (formerly Entertainment) and AGEST Group (formerly Enterprise) improved margins, although consolidated OP saw a small decline (-4.1% YoY).
• DH Group’s segment OP declined (-9.9% YoY), but the segment OP margin improved (Q4 FY3/24 7.1%, Q4 FY3/25 7.3%), reflecting the sale of a low-margin subsidiary.
• AGEST Group’s segment OP increased (+8.4% YoY) with the improved segment OP margin (Q4 FY3/24 4.5%, Q4 FY3/25 5.1%) on the back of better profitability in overseas QA Solutions than Q4 FY3/24.