IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Equity Capital Markets

<ul>
<li>Since the US$4.0 billion secondary placement announcement, <a href="https://www.smartkarma.com/entities/denso-corp" target="_blank" data-smartkarma-citation="entities:18703:1" rel="noopener">Denso Corp (6902 JP)</a>’s shares are down 4.3% from the undisturbed price of JPY2,298 per share (28 November).</li>
<li>Looking at recent large Japanese placements is instructive to understand the potential trading pattern. So far, Denso’s shares have followed the pattern of previous large placements.</li>
<li>The offering will likely be priced on 13 December. Investors participating in previous large Japanese placements tend to secure positive returns.</li>
</ul>


Since the US$4.0 billion secondary placement announcement, Denso Corp (6902 JP)’s shares are down 4.3% from the undisturbed price of JPY2,298 per share (28 November).
Looking at recent large Japanese placements is instructive to understand the potential trading pattern. So far, Denso’s shares have followed the pattern of previous large placements.
The offering will likely be priced on 13 December. Investors participating in previous large Japanese placements tend to secure positive returns.


Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/rakuten-group-inc" target="_blank" data-smartkarma-citation="entities:31:1" rel="noopener">Rakuten Group (4755 JP)</a> is looking to sell 25.5m shares of <a href="https://www.smartkarma.com/entities/rakuten-bank-ltd" target="_blank" data-smartkarma-citation="entities:35638:1" rel="noopener">Rakuten Bank (5838 JP)</a> via a secondary offering at a discount of between 8.7%-12.3%.</li>
<li>The offering will raise a maximum of US$433m and <a href="https://www.smartkarma.com/entities/rakuten-group-inc" target="_blank" data-smartkarma-citation="entities:31:1" rel="noopener">Rakuten Group (4755 JP)</a> will use the funds to reduce its interest-bearing debt by the early repayment of its bonds.</li>
<li>There will be limited passive buying at the time of settlement of the stock but there is an index inclusion coming up that will result in passives buying.</li>
</ul>



Rakuten Group (4755 JP) is looking to sell 25.5m shares of Rakuten Bank (5838 JP) via a secondary offering at a discount of between 8.7%-12.3%.
The offering will raise a maximum of US$433m and Rakuten Group (4755 JP) will use the funds to reduce its interest-bearing debt by the early repayment of its bonds.
There will be limited passive buying at the time of settlement of the stock but there is an index inclusion coming up that will result in passives buying.


Rakuten Bank (5838 JP) Placement: Index Inclusion Will Absorb Some Stock

<ul>
<li>
<a href="https://www.smartkarma.com/entities/denso-corp" target="_blank" data-smartkarma-citation="entities:18703:1" rel="noopener">Denso Corp (6902 JP)</a> announced a secondary offering of up to 294.8 billion shares (including overallotment) and a buyback (maximum shares of 125 million or maximum value of JPY200 billion).</li>
<li>Denso also announced a cross-holding reduction policy. In an unspecified timeframe, it will sell part of its holdings in <a href="https://www.smartkarma.com/entities/toyota-industries-corp" target="_blank" data-smartkarma-citation="entities:4500:1" rel="noopener">Toyota Industries (6201 JP)</a> and <a href="https://www.smartkarma.com/entities/aisin-corp" target="_blank" data-smartkarma-citation="entities:11809:1" rel="noopener">Aisin (7259 JP)</a>.</li>
<li>Looking at recent large Japanese placements is instructive to understand the potential offer price. The pricing date will fall between 13 and 18 December (likely 13 December).</li>
</ul>



Denso Corp (6902 JP) announced a secondary offering of up to 294.8 billion shares (including overallotment) and a buyback (maximum shares of 125 million or maximum value of JPY200 billion).
Denso also announced a cross-holding reduction policy. In an unspecified timeframe, it will sell part of its holdings in Toyota Industries (6201 JP) and Aisin (7259 JP).
Looking at recent large Japanese placements is instructive to understand the potential offer price. The pricing date will fall between 13 and 18 December (likely 13 December).


Denso (6902 JP): US$4.0 Billion Secondary Offering and US$1.4 Billion Buyback

Asahi Group Holdings / Equity Capital Markets

<ul>
<li>Since the US$1.3 billion secondary placement announcement, <a href="https://www.smartkarma.com/entities/asahi-group-holdings-ltd" target="_blank" data-smartkarma-citation="entities:10482:1" rel="noopener">Asahi Group Holdings (2502 JP)</a>’s shares are down -6.2% from the undisturbed price of JPY5,804 per share (16 November).</li>
<li>Looking at recent large Japanese placements is instructive to understand the potential trading pattern. So far, Asahi’s shares have followed the pattern of previous large placements. </li>
<li>The offering will likely be priced on 28 November. Investors participating in previous large Japanese placements tend to secure positive returns.</li>
</ul>


Since the US$1.3 billion secondary placement announcement, Asahi Group Holdings (2502 JP)’s shares are down -6.2% from the undisturbed price of JPY5,804 per share (16 November).
Looking at recent large Japanese placements is instructive to understand the potential trading pattern. So far, Asahi’s shares have followed the pattern of previous large placements. 
The offering will likely be priced on 28 November. Investors participating in previous large Japanese placements tend to secure positive returns.


Asahi Group (2502 JP): The Current Playbook

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/gs-yuasa-corp" target="_blank" data-smartkarma-citation="entities:8298:1" rel="noopener">Gs Yuasa Corp (6674 JP)</a> (GSY) is looking to raise around US$240m via a public offering, along with placing shares via third-party allotment with <a href="https://www.smartkarma.com/entities/honda-motor-co-ltd" target="_blank" data-smartkarma-citation="entities:154:1" rel="noopener">Honda Motor (7267 JP)</a> .</li>
<li>The company formed a JV with Honda Motors earlier this year and will use the bulk of the proceeds for investments in the JV.</li>
<li>In this note, we will talk about the deal dynamics and run the deal through our ECM framework.</li>
</ul>



Gs Yuasa Corp (6674 JP) (GSY) is looking to raise around US$240m via a public offering, along with placing shares via third-party allotment with Honda Motor (7267 JP) .
The company formed a JV with Honda Motors earlier this year and will use the bulk of the proceeds for investments in the JV.
In this note, we will talk about the deal dynamics and run the deal through our ECM framework.


GS Yuasa Placement - Well Flagged but Relatively Large Deal, Liquidity Might Be an Issue

Japan

Renesas Electronics Corporation researches, develops, designs and manufactures electronic components such as semiconductors and integrated devices.

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Renesas Electronics (6723 JP)

Denso (6902 JP): The Current Playbook

The shares are down 4.3% since announcing the offering, which will likely be priced on 13 December. Investors participating in previous large...

Arun George

Rakuten Bank (5838 JP) Placement: Index Inclusion Will Absorb Some Stock

Rakuten is looking to raise up to US$433m by selling 14.6% of Rakuten Bank. Rakuten Bank has an index inclusion coming up and there will be passive...

Brian Freitas

Denso (6902 JP): US$4.0 Billion Secondary Offering and US$1.4 Billion Buyback

Looking at recent large Japanese placements is instructive to understand the potential offer price. The pricing date will fall between 13 and 18...

Arun George

Asahi Group (2502 JP): The Current Playbook

The shares are down 6.2% since announcing the offering, which will likely be priced on 28 November. Investors participating in previous large...

Arun George

GS Yuasa Placement - Well Flagged but Relatively Large Deal, Liquidity Might Be an Issue

Gs Yuasa Corp (6674 JP) (GSY) is looking to raise around US$240m via a public offering, along with placing shares via third-party allotment with...

Sumeet Singh

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