“Double Dip” - a scenario to consider seriously. Events of this week have unfolded to everyone’s surprise... very negatively.
1/ India new epicenter - cases gone wild (25x higher versus Feb levels). Mutations present accelerated / aggressive disease presentation. India not on travel red lists of most major countries (yet/despite)
GRAB / ALTIMETER $AGC
The positives are well known and enormous respect to Anthony and Hooi Ling for creating an ASEAN behemoth. Nevertheless, here's some of the less obvious, but key points to note on this $40b deal. (1/n)
1. Control: Anthony Tan will continue to control the company with 60.4% of the voting rights, despite owning just 1.1@ of ordinary shares. sec.report/Document/00011… pg 48
Disclosure (thus far): The company hasn't released all the financial details, instead it has put up a dressy deck with 2021-23 projections. So not that much to chew on. Still...
💡 IDEAL $KBANK.TB - consensus Thai O/W, seen as a digital aspirant. However, Brian spots two flies in the ointment. Stock has doubled from 2020 lows, so this is worth noting.
(1/n)
1. foreign line highly likely deletion from MSCI at upcoming MAY SAR - Deletion of the foreign line would require passive funds to sell 87m shares...
2. There is also a possibility of a reduction in the Foreign Inclusion Factor (FIF) on the Non Voting Depository Receipt (NVDR) line if the foreign room stays below 15% on the price cutoff date. This would necessitate selling of around 22m shares.
BABA: opens +9% and continuing to trade VERY strong in HK today. Market realising pendulum swung too far, and starting to fade the risk premia here. (Chart: BABA vs TENCENT intraday)
Putting things into perspective: since November, Media frenzy and Investor panic wiped $260bn in value.
Meanwhile, 4Q was historic high Q-rev growth +37% Y/Y, historic high core commerce EBITDA, and historic high quarterly op profit. Clodu turned profitable, and Cainiao positive OCF also.
Thai IPO raising $750m: Ngern Tid Lor (NTL) jointly owned by CVC and Bank of Ayudhya (BAY TB) with 16pc market share.
Impressive track record: 2016-20, gross l25.1% CAGR, total income 22.5% CAGR, while PAT did better with a CAGR of 29.1% over 2016-20.
Gets better: 2010-20, its total income has increased by 12.6x, branch network by 6x and receivables by 18x. That implies a CAGR of 28.9% for total income, 19.6% for branches and 33.5% for receivables.