BreadTalk

BreadTalk: DMG maintains Buy with TP of $1.90 (from $2), based on 7.5x FY15e EV/EBITDA. Believes that the stock is undervalued, and that BreadTalk's diversified offerings and mass market prices will continue to thrive despite the weak spending environment. Two catalysts: 1) The Food Atrium division (25% of group profit) is expected to be an important pillar of growth, underpinned by the group's store expansion plans particularly in China , where this concept is still relatively new but popular. Targeting 100 food courts in the medium term (currently 63). 2) Through its 50/50 JV agreement with substantial shareholder Minor Int'l, DMG expects BreadTalk to expand its number of bakeries in Thailand from just 23 to an eventual goal of 100-150 outlets. Minor will be involved in the day to day operations, and its expertise in Thailand will be invaluable. The collaboration could extend further into restaurants and food courts.