Equity Analyst - Asia Consumer Sector, Investory

Devi Subhakesan

Equity Research experience of over 20 years include working at leading Asset Management and Brokerage/Investment Banking Firms.  

I focus primarily on the Asia consumer sector and analyse emerging trends and evolving consumption behaviours to publish investment insights on segments where women and/or youth drive purchasing decisions.

My approach combines in-depth industry and company research with rigorous valuation analysis to help investors make informed investment decisions.

Equity Analyst - Asia Consumer Sector

The Week that Was in ASEAN@Smartkarma - Smartphones, Indonesian Cement, and Tobacco

Jollibee Foods (JFC PM): Riding Out of the COVID Storm. Upside Potential.

ASIA CONSUMER: INSIGHTS AND INVESTMENT IDEAS

Investory

Investory is a Singapore-based boutique independent equity research firm founded in January 2017 with a primary focus on consumption themes across Asia-Pacific.

We aim to generate investible ideas based on consumption trends and outlook. We screen our ideas on several parameters - product potential, long-term growth and management commitment being the most critical.  We follow a fundamental analysis approach in our stock selection process and are not restricted by market cap.

We aspire to grow into a leading source of unbiased research, free of conflict of interest, for investors yearning for independent and disciplined analysis. 

We also undertake bespoke research mandates to support our Institutional clients’ investment needs.

Our team comprises of professionals with extensive experience in the Asian equity markets, in areas ranging from research, servicing institutional clients and investment management.

Event-Driven

<a href="https://www.smartkarma.com/entities/jollibee-foods-corp" target="_blank" data-smartkarma-citation="entities:987:1" rel="noopener">Jollibee Foods (JFC PM</a>), amongst the largest Asia-bred fast-food retail chain operators, has announced its plans to acquire the privately-held loss-making US-based coffee &amp; tea retailing chain Coffee Bean &amp; Tea Leaf (CBTL), reportedly for USD350 mn. With its largest acquisition till date, Jollibee will be expanding its presence in coffee retailing beyond Vietnam (where its Highlands coffee chain is a segment leader) to rest of Asia and the US; CBTL <a href="https://www.ft.com/content/c738b39e-adce-11e9-8030-530adfa879c2" target="_blank" rel="noopener">reportedly</a> has 1189 outlets worldwide of which around 800 are in Asia. In the context of overheated valuations for coffee retail in Asia, thanks to the premium listing of <a href="https://www.smartkarma.com/entities/luckin-coffee" target="_blank" data-smartkarma-citation="entities:28046:1" rel="noopener">Luckin Coffee (LK US)</a> and the recent reports of <a href="https://www.smartkarma.com/entities/coca-cola-co-the" target="_blank" data-smartkarma-citation="entities:979:1" rel="noopener">Coca Cola Co (KO US)</a> in discussion to acquire India's largest coffee chain <a href="https://www.smartkarma.com/entities/coffee-day-enterprises-ltd" target="_blank" data-smartkarma-citation="entities:26188:1" rel="noopener">Coffee Day Enterprises (CCD IN)</a>, this acquisition seems to be a value buy with good fit for Jollibee.However, <a href="https://www.smartkarma.com/entities/jollibee-foods-corp" target="_blank" data-smartkarma-citation="entities:987:1" rel="noopener">Jollibee Foods (JFC PM)</a> stock is down more than 10% since the acquisition was announced based on concerns about (1) earnings dilution from the acquisition (2) too many acquisitions too soon, and hence management being able to effectively turn them around. In the note below, we analyse if these concerns are valid and how the management can effectively address the investor concern that Jollibee is attempting to be the Jack of all food trades and could end up being master of none.

Jollibee Foods (JFC PM), amongst the largest Asia-bred fast-food retail chain operators, has announced its plans to acquire the privately-held loss-making US-based coffee &amp; tea retailing chain Coffee Bean &amp; Tea Leaf (CBTL), reportedly for USD350 mn. With its largest acquisition till date, Jollibee will be expanding its presence in coffee retailing beyond Vietnam (where its Highlands coffee chain is a segment leader) to rest of Asia and the US; CBTL reportedly has 1189 outlets worldwide of which around 800 are in Asia. In the context of overheated valuations for coffee retail in Asia, thanks to the premium listing of Luckin Coffee (LK US) and the recent reports of Coca Cola Co (KO US) in discussion to acquire India's largest coffee chain Coffee Day Enterprises (CCD IN), this acquisition seems to be a value buy with good fit for Jollibee.However, Jollibee Foods (JFC PM) stock is down more than 10% since the acquisition was announced based on concerns about (1) earnings dilution from the acquisition (2) too many acquisitions too soon, and hence management being able to effectively turn them around. In the note below, we analyse if these concerns are valid and how the management can effectively address the investor concern that Jollibee is attempting to be the Jack of all food trades and could end up being master of none.

Jollibee's (JFC PM) Acquisition of Coffee Bean -  Value Buy in Asia's 'Hot' Coffee Segment