From Legen Biotech to Thai Beverage to Hong Kong Stocks Update here's what you need to know this week.

The Smartkarma Weekly Starter is a newsletter published every Sunday and pulls together the top research notes published over the last 7-days from across our platform.

In this week's edition of the Smartkarma Weekly Starter, we get a quick rundown on the top engaged insights for the week.

Start your week off on the right foot with:

Legend Biotech (LEGN US) - A Takeover Offer?

Legend Bio is an attractive M&A target with promising Carvykti outlook. Peak sales could reach over $5 billion. Legend Bio is currently undervalued. Reasonable market value is $12.5-15 billion.

• Legend Biotech received takeover interest and hired Centerview Partners to review the offer. Due to the satisfactory clinical results/promising commercialization outlook of Carvykti, Legend Bio is an attractive M&A candidate.
• Peak sales of Carvykti could exceed US$5 billion. After Carvykti is approved by the FDA/EC for 2L treatment of MM, future valuation leap of legend Bio is becoming more certain.
• Legend Bio is clearly undervalued. We think reasonable market value range for Legend Bio is about US$12.5 – 15 billion, which means there is decent upward potential for share price.

By Xinyao (Criss) Wang in Event-Driven

Thai Beverage (THBEV SP): Faces Potential Hit as Vietnam Proposes Beer Tax Hike

Potential tax hike in Vietnam makes BeerCo listing unlikely for now. With no meaningful catalyst and a weak sector outlook, the stock could trend down after index-inclusion led passive buying ends.

• Thai Beverage (THBEV SP)?majority-owned SABECO, a leading beer company in Vietnam, may face volume declines if the proposed beer tax hike is implemented.
• The tougher market outlook makes the earlier proposed BeerCo listing unlikely anytime soon. ?
• With no meaningful stock catalyst, weak sector outlook and a stretched balance sheet, the stock could slip down after index inclusion related passive stock buying ends.

By Devi Subhakesan in Equity Bottom-Up

Thai Bev (THBEV SP): Exits Property, Boosts F&N Stake. Deal Valuation Seem Excessive

Proposed share swap deal with promoter company based on negotiated values not market prices. Acquisition value for F&N seem excessive and unfavourable for Thai Beverage's share holders.

• Thai Beverage(THBEV SP)? has proposed a share swap-deal with a promoter company to acquire additional stake in FraserAnd Neave(FNN SP)? in exchange for?Frasers Property at negotiated valuations, not market prices.
• Post-Completion of the swap deal with the promoter-owned entity, which requires shareholder approval, Thai Bev will hold a 69.6% stake in F&N and no stake in Fraser Property (FPL).
• If the stake swap were valued at yesterday's closing share prices, it would imply a drop in the total stake value for Thai Bev after the proposed deal.

By Devi Subhakesan in Event-Driven

Perfect Medical (1830 HK): Gleanings from the Annual Report and Presentation For FY24

We summarize our learnings from Perfect Medical's (1830 HK) annual report. Trading at a 12% dividend yield and 17% of its market capitalization in cash, this is a stock worth exploring.

• We analyze the audited annual report of Perfect Medical Health (1830 HK) released on the 16th of July. We also analyzed the company's FY24 presentation.?
• The key takeaway is that the company will endeavor to improve its efficiency by cross-selling more services through Beauty Supermarket and expanding the sleep therapy business with Goku.
• Trading at a 12.5% dividend yield with 17% of its market cap in cash and >50% ROEs, the business is solid and worth exploring as an investment.?

By Sameer Taneja in Equity Bottom-Up

Merger Arb Mondays (15 Jul) - China TCM, Canvest, Henlius, Hollysys, Second Chance, Anasarda, Rex

This week, the highest gross spreads are HEC Pharma (134.8%), China TCM (32.2%), Canvest (13.4%), A8 New Media (12.5%), Asia Cement (11.8%), GA Pack (11.3%), Malaysia Airports (11.3%), Huafa (9.4%).

• We summarise the latest spreads and newsflow of merger arb situations we cover across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Philippines, Thailand and Chinese ADRs.
• Highest spreads: Yichang HEC Changjiang Pharma (1558 HK), China Traditional Chinese Medicine (570 HK), Canvest Environmental Protection Group (1381 HK), A8 New Media (800 HK), Asia Cement China (743 HK).
• Lowest spreads: Fancl Corp (4921 JP), Tatsuta Electric Wire & Cable (5809 JP), Alumina Ltd (AWC AU), Nagatanien Holdings (2899 JP), Mimasu Semiconductor Industry (8155 JP), Infocom Corp (4348 JP).?

By Arun George in Event-Driven

Samson Holding (531 HK): Chairman’s Scheme Privatisation at HK$0.48

The attractive takeover premium, lack of shareholders holding a blocking stake, and low AGM minority participation rate point to a done deal. However, this is a small cap illiquid stock.

• Samson Holding (531 HK)?disclosed a Cayman scheme privatisation offer from Mr Samuel Kuo (Chairman) at HK$0.48 per share, a 77.8% and 50.0% premium to undisturbed and last close price, respectively.?
• The key condition will be approval by at least 75% of disinterested shareholders (<10% of all disinterested shareholders rejection). The offer price is final.
• The attractive takeover premium, lack of shareholders holding a blocking stake, and low AGM minority participation rate point to a done deal. However, this is a small cap illiquid stock.

By Arun George in Event-Driven

BUY/SELL/HOLD: Hong Kong Stocks Update (July 15)

Hong Kong markets continue to trade at a 25% discount to analysts year end targets.? Bud APAC, Anta Sports, Sunny Optical and Shineway RX are receiving high marks from analysts.

• Hong Kong market still trades at a substantial discount to Analyst year end price targets.
• Budweiser APAC is dependent on China's consumer to lift sales while Anta Sports is targeting increased sales from the upcoming Paris Olympics.
• Sunny Optical is seeing substantial growth from it EV segment and Haitian continues to grow its international sales.? Shineway RX is a rare value play in the pharmaceutical sector.

By David Mudd in Equity Bottom-Up

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