Sa Sa International 0178

Re: Sa Sa International 0178

Postby winston » Tue Jan 28, 2014 10:25 am

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SA SA INT'L (00178.HK) condemns allegations made by Next Magazine

Responding to the report and allegations made by Next Magazine, SA SA INT'L (00178.HK) +0.170 (2.439%) Short selling $24.00M; Ratio 19.981% clarified that it has strict and clear company policies and procedures in place for cosmetics retailing.

All cosmetics products with usage period of less than six months, as well as health food and medicine products with less than one month of usage period must be removed from shelves. As such, store supervisors and staff have no incentives for such wrongful behavior. Therefore, the false accusation by Next Magazine is illogical and absurd.

Moreover, the company said it sells cosmetics products with usage period of less than six months at discounted prices in its outlet stores. Usage periods on such relevant products are traced by different labeling. The company declares it does not and will not sell any expired products, and does not and will not use expired products for gift premium purposes.


Source: AAStocks Financial News
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Re: Sa Sa International 0178

Postby winston » Thu Feb 13, 2014 7:39 pm

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Sa Sa International Holdings – In the middle of difficulty, lies opportunity
Rating: Accumulate
Closing price: 7.40
Target price: 8.12

Sa Sa’s share price had significant correction recently, which slid 18.3% in January (vs. HSI fell 5.5% over the same period).

We attributed it to :-

1.) Concern on slower gross margin expansion after the Group announced its 3QFY14 operational data: 3QFY14 SSSG in HK & Macau was 15.8% (vs. 11.1% in 2QFY14), but the market think the promotions and discount activities to exchange for the considerable sales growth would hurt the Group’s gross margin, and it extended to worry whether Sa Sa can keep the SSSG at high level in coming quarters.

2.) Concern on declining growth rate of the number of mainland visitor: According to Hong Kong Tourism Board data, the number of mainland visitor in 4Q2013 rose 11.1% YoY to 10.6 mn (vs. YoY growth rate of 16.7% for full-year), the growth trend is obviously slowing down.

3.) A magazine reported that Sa Sa’s staffs wiped away the expiry date of products and sell the expired products, which hurt the Group’s brand.

4.) Concern on Sa Sa’s inability to have turnaround in Mainland China market in near-term: Sa Sa posted operating loss of HKD27.2 mn in Mainland China in 1HFY14 (vs. HKD19.8 mn loss in 1HFY13), the loss situation worsened.


Sa Sa continued to have gross margin expansion in past few years (from 43.7% in FY09 to 46.4% in FY13). Although the gross margin may be lower than market expectation after promotion activities from mid-October of last year, management said that the fine-tune of marketing strategy would reverse the downtrend of gross margin in 4QFY14. Sa Sa recorded gross margin of 47.0% in 1HFY14 (vs. 45.7% in 1HFY13), we conservatively estimate the gross margin will expand 1.2 ppts to 46.4% in FY14.

Sa Sa is trading at FY14 forecast P/E of 21.4x (vs. 5-year average is 20.9x), we expect Sa Sa’s FY14/15 EPS to be HKD 34.6/40.6 cents, net profit’s 2-year CAGR is 17.9% (vs. 29.3% CAGR for past 3-year).

We give a target price of HKD8.12, based on FY15 forecast P/E of 20.0x. We give a “Accumulate” rating with upside potential of 9.7%.

The major downside risks are:-
1.) contraction of gross margin,
2.) weaker spending power of mainland visitors,
3.) a significant increase in rental/staff costs.


Source: Phillips
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Re: Sa Sa International 0178

Postby winston » Sat Feb 15, 2014 9:19 am

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SA SA INT'L (00178.HK) rated Buy with target cut to $9 by Citi
2014-02-13

SA SA INT'L (00178.HK) -0.020 (0.279%) Short selling $1.81M; Ratio 3.957% 's sales performance weakened during the Chinese New Year break due to the high base in the year-ago period and the lower purchasing power of mainland tourists, but a strong rebound in sales was observed in post-CNY period (3-9 February), Citigroup said in a report.

Given the projections that sales growth will slow in countries like China and Singapore and in the field of e-commerce, the broker was conservative towards the future trend of the company's gross margin.

It reduced the group's 2014-16 earnings forecasts by 3-9%. Accordingly, the target price was cut from $9.75 to $9. However, the group has resilience in profit growth, the broker said, adding that with a dividend payout ratio of 4%, it is quire attractive. The stock was rated Buy.


Source: AAStocks Financial News
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Re: Sa Sa International 0178

Postby winston » Fri Apr 18, 2014 7:53 pm

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SA SA INT'L (00178.HK) upgraded to Buy, target reduced to $7.64 - UBS
2014-04-17

The stock price of SA SA INT'L (00178.HK) +0.270 (4.072%) Short selling $17.54M; Ratio 24.825% has plunged 30% over the past three months, which UBS believed the negatives have been factored in.

The broker lowered its earnings per share forecast on SA SA INT'L by 9%/8%/8% for 2014-16 to reflect lower same stores sales growth and profit margin.

Meanwhile, the target price was reduced from $8.25 to $7.64. Yet, SA SA INT'L is trading at 20x/17x FY14E/15E PE, which will give support to the stock price. As such, UBS upgraded SA SA INT'L from Neutral to Buy.


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Re: Sa Sa International 0178

Postby winston » Wed Apr 23, 2014 7:08 pm

SA SA INT'L (00178.HK) records double digit growth in sales in Easter
2014-04-23

SA SA INT'L (00178.HK) -0.040 (0.581%) Short selling $11.32M; Ratio 51.239% Chairman Kwok Siu Ming stated the group had recorded double digit growth in sales during the Easter holiday.

He expected continuous growth in the upcoming Golden Week in May, yet the magnitude may not be as strong as last year, due to weaker consumption power of Chinese tourists.

Source: AAStocks Financial News
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Re: Sa Sa International 0178

Postby winston » Sat Apr 26, 2014 8:41 am

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SA SA INT'L (00178.HK) charged breach of lease
2014-04-25

According to market sources, SA SA INT'L (00178.HK) +0.180 (2.671%) Short selling $27.58M; Ratio 45.673% had violated the tenancy agreement of a commercial unit located at Lucky Plaza, Sha Tin, and the landlord had filed a litigation at the High Court, demanding for financial compensations.

Sources suggested that the commercial unit was agreed to be used for retailing purpose, but it was found out that the unit has been used as a warehouse by the beauty product chain.


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Re: Sa Sa International 0178

Postby winston » Tue Apr 29, 2014 7:13 pm

Still our top pick

Sa Sa’s management attended our Asia-Pac Small/Mid-Cap Conference recently.

FAQs centred on:
1) SSSG and sales-growth trends in Hong Kong and Macau YTD;
2) growth targets for FY15; and
3) expansion plans for HK & Macau and China.

While YTD SSSG has been slowing in HK, China’s smaller concept stores have been performing better in sales terms, with most of them breaking even within a year.

We lower our FY14-16 EPS by 3-9%, mainly for slowing traffic growth (hence SSSG) and larger losses from its China business.

Therefore, we lower our TP to HK$9.00, now based on 21x CY15 P/E (23x previously), the sector average for good-quality consumer staples.

We keep our Add rating with market-share gains as potential catalysts.

Source: CIMB
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Re: Sa Sa International 0178

Postby winston » Fri May 09, 2014 10:15 pm

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SA SA INT'L (00178.HK) rated Overweight, target reduced to $7.6 - HSBC
2014-05-09

The management of SA SA INT'L (00178.HK) -0.370 (6.491%) Short selling $31.17M; Ratio 24.643% said the poor sales during the Labor Day holiday was attributable to a 10% decline in total average sales per transaction, offsetting the 10% rise in number of transactions, HSBC Global Research noted in a report.

Meanwhile, the purchasing power of mainland Chinese visitors has weakened as their arrivals have been tapering and the proportion of same-day visitors increased.

HSBC Global Research reduced its FY2014-16e profit margins on SA SA INT'L by 50% on changing product assortments. The broker also lowered FY2014-16e earnings forecast on the company by 11%-16%. SA SA INT'L was reiterated Overweight with target price reduced from $10.38 to $7.6.

Source: AAStocks Financial News
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Re: Sa Sa International 0178

Postby winston » Sun May 11, 2014 8:49 am

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CS reduces SA SA INT'L (00178.HK) target price to $5.8
2014-05-08

SA SA INT'L (00178.HK) -0.370 (6.491%) Short selling $31.17M; Ratio 24.643% reported its same store sales declined by 5% during the Labor Day holiday, far below the group's estimates, Credit Suisse said in a report.

Despite a 10% year-on-year growth in overall transactions, retail sales decreased 1% on the year. The weakening purchasing power of mainland Chinese visitors led to a drop of more than 10% in the average sales per transaction.

Credit Suisse reduced FY2014-16 earnings forecast on SA SA INT'L by 5%-8%.

SA SA INT'L was kept Neutral with target price reduced from $6.9 to $5.8.

Source: AAStocks Financial News
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Re: Sa Sa International 0178

Postby winston » Sun May 11, 2014 8:55 am

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SA SA INT'L (00178.HK) downgraded to Neutral, target reduced to $6.8 - JPM
2014-05-08

SA SA INT'L (00178.HK) -0.370 (6.491%) 's same store sales dropped 5% during the Labor Day holiday, far worse than the company's expectation, JP Morgan noted in a report.

In the short to medium term, the company's sales will still be affected by the previously reported negative news, weaker purchasing power of customers and the change of shopping preference.

The broker previously predicted that the high-speed rail could be medium term catalyst. However, MTR CORPORATION (00066.HK) +0.100 (0.347%) Short selling $8.45M; Ratio 19.503% recently said the high speed rail has to face delay in start running till 2017.

Given such negative news, the company's after-tax net profit forecasts for 2014/15/16 were reduced by 3%/14%/20%. The rating was downgraded from Overweight to Neutral, with target price slashed from $9.4 to $6.8.


source: AAStocks Financial News
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