FOUNDATIONMChinaSeasoningsWaystoSavortheFlavorSeasoningisthefastestgrowingcategoryintheChinafood&beveragesectorsunderourcoverage.Weexpectmarketsharegains,premiumizationandproductdiversificationtodrivestrongsalesandearningsgrowthforkeyseasoningplayers.WeinitiateonJonjeeatOWandAngelYeastatEW.MaintainEWonHaitianforfairvaluation.MorganStanleydoesandseekstodobusinesswithcompaniescoveredinMorganStanleyResearch.Asaresult,investorsshouldbeawarethatthefirmmayhaveaconflictofinterestthatcouldaffecttheobjectivityofMorganStanleyResearch.InvestorsshouldconsiderMorganStanleyResearchasonlyasinglefactorinmakingtheirinvestmentdecision.Foranalystcertificationandotherimportantdisclosures,refertotheDisclosureSection,locatedattheendofthisreport.+=Analystsemployedbynon-U.S.affiliatesarenotregisteredwithFINRA,maynotbeassociatedpersonsofthememberandmaynotbesubjecttoNASD/NYSErestrictionsoncommunicationswithasubjectcompany,publicappearancesandtradingsecuritiesheldbyaresearchanalystaccount.March31,201906:00AMGMTFOUNDATIONMMORGANSTANLEYASIALIMITED+LeafLiuEquityAnalyst+8523963-1905Leaf.Liu@morganstanley.comContributorsMORGANSTANLEYASIALIMITED+LillianLouEquityAnalyst+8522848-6502Lillian.Lou@morganstanley.comFOUNDATIONMChinaSeasoningsWaystoSavortheFlavorSeasoningisthefastestgrowingcategoryintheChinafood&beveragesectorsunderourcoverage.Weexpectmarketsharegains,premiumizationandproductdiversificationtodrivestrongsalesandearningsgrowthforkeyseasoningplayers.WeinitiateonJonjeeatOWandAngelYeastatEW.MaintainEWonHaitianforfairvaluation.compareswithaglobalaverageof3.6xandaChinastaplesaverageof1.5x,whileweinitiateatEWonAngelYeastasnear-termmarginpressureislikelytoweighonitsvaluation.Potentialcatalystsincludepricehikes,marketconsolidation,newproductlaunches,andcateringgrowthacceleration.Keyrisksincludeaconsumptionslowdown,foodsafetyissues,andrawmate-rialcosthikes.Premiumizationandproductdiversifica-tiontodrivemulti-yeargrowth:SeasoningisthefastestgrowingcategoryintheChinafood&beveragesectorsunderourcover...
