WEIMOB INC. (2013) recently announced proposed acquisition and subscription of 51% equity interest in Heading Information. Heading Information is principally engaged in providing information and digital upgrading solutions for retail enterprises. Currently, it mainly provides information solutions in chain retail, commercial real estate, and warehousing and logistics for multi-format merchants and enterprises including convenience stores, specialized stores, supermarkets, department stores and shopping malls, and also explores innovative businesses related to payment and smart hardware. After the transaction, the Group will develop its businesses in retail including commercial real estate, chain supermarkets and chain convenience stores, so as to cover customers and pipelines in retail, and will have the opportunity to further expand the chain brand owners who have cooperative relations with such customers. (I do not hold the above stock)
Buy-in Price: $11.00, Target Price: $13.00, Cut Loss Price: $10.00
Semir Garment (002563.SZ)Semir Garment was established in 1996, opened the first Semir brand store in 1997, and started a brand extension strategy in 2002, founded the children`s clothing brand "balabala" and established the company`s predecessor. The company`s mainly engaged in product design, brand management, supply chain management and channel development business. Its brands mainly include adult leisure brand "Semir", children`s clothing brand "balabala", "MarColor" and "mini balabala". The company has now developed into a dual-leading position in the domestic casualwear clothing and children`s clothing industries. According to the China National Garment Association, the company ranks 8th in the national apparel industry based on 2019 operating income. In addition, according to euromonitor, balabala ranks first in the children`s clothing market with 6.9%, which is 5.3 pct higher than the second place, Anta Kid. In 2019, the company`s revenue from children`s clothing business was approximately RMB 12.66 billion, of which 2.97 billion came from the Kidiliz Group, which was transferred in September, an increase of 43.5% year-on-year, and its casual apparel revenue was RMB 6.54 billion, a YoY decrease of 3.6%.
Buy-in Price: $9.30, Target Price: $10.40, Cut Loss Price: $8.85
Razer (1337.HK) - Razer failed on SG Digital Banking Bid, but the long-term impact is minimum
The Monetary Authority of Singapore (MAS) announced on December 4, 2020 that four successful digital bank applicants. The Monetary Authority of Singapore expects that the digital bank will be operational as early as 2022. Among four licenses, two are "Digital Wholesale Bank"(DWB) licenses, which are respectively granted to an entity wholly-owned by Ant Group and a consortium comprising Greenland Finance Holdings Group Co.Ltd, Linklogis Hong Kong Ltd, and Beijing Co-operative Equity Investment Fund Management Co. Ltd. The other two licenses are the "Digital Full Bank License", which are granted to a consortium comprising Grab Holding Inc. and Singapore Telecommunications Ltd. (Singtel), and an entity wholly-owned by Sea Limited.
Razer (the ¡§Company¡¨) financial technology branch "Razer Fintech" once applied for a Singapore digital bank license, but the first round of the list failed. The Company's management stated that although it failed the Singapore Digital Bank, its long-term development of technology and financial business strategy will be firmly implemented.
The management said that regional countries such as Malaysia or the Philippines also have a lot of opportunity. The long-term attractiveness of the Southeast Asian market lies in its demographic advantage. There are about 600 million young people in the region and the region's middle-class population is growing rapidly. Favorable policies such as large infrastructure construction, these factors are conducive to the continued economic growth of the region, and bring huge business opportunities to companies operating in the region. According to e-Conomy SEA, more than a third of consumers are new to digital services in Malaysia and the Philippines which presents a huge market opportunity for us to be the first providers in the area of Fintech and digital financial services for them. We believe that although the Company has failed in the Singapore digital banking license, the Company intend to roll our Razer Youth Bank where Razer and Razer Fintech have already established a strong user base and local business presence, be it in regional countries such as Malaysia and the Philippines where digital banking application processes are expected to kickstart in the near term or other regions, such as Europe, Middle East or Latin America where regulators are similarly supportive of innovation in the banking sector to better serve the unbanked and underserved segments of the economy. It can be seen that the Company's determination to develop financial technology business and the long-term value of Fintech business remained unchanged.
Valuation and Investment Recommendation
In summary, we believe that although the Company has failed on the Singapore Digital Banking Bid, it has little impact on its core business operations. The "Home Economy" business continues to grow. In addition, we believe that the Company's determination to develop the Fintech business remains unchanged. Razer relies on its strong brand with more than 100 million fans worldwide, we believe that the Company's financial technology business in other regions can develop rapidly. We maintain the Company's 2020/2021/2022 revenue per share of US $0.12/0.14/0.17, twelve-month target price of HKD3.27, corresponding to 2020/2021/2022 P/S ratio of 3.58x/3.00x /2.52x. We maintain Buy rating.(Exchange rate: 7.78 USD/HKD) (Current price as of 10 December 2020)
1) COVID-19 outbreak again
2) E-sports growth not as expected
3) The Company's products fail to cater the user trends
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|Recommendation on 14-12-2020|
|Price on Recommendation Date||$ 2.370|
|Suggested purchase price||N/A|
|Target Price||$ 3.270|
| H share
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