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.

Equity Capital Markets

<ul>
<li>A group of shareholders aims to raise around US$1.3bn via selling around 11% of <a href="https://www.smartkarma.com/entities/asics-corp" target="_blank" data-smartkarma-citation="entities:16287:1" rel="noopener">ASICS Corp (7936 JP)</a>.</li>
<li>For the two large banks, this will be a cleanup of their cross-shareholding.</li>
<li>In this note, we will talk about the placement and run the deal through our ECM framework.</li>
</ul>


A group of shareholders aims to raise around US$1.3bn via selling around 11% of ASICS Corp (7936 JP).
For the two large banks, this will be a cleanup of their cross-shareholding.
In this note, we will talk about the placement and run the deal through our ECM framework.


ASICS Placement - Needs to Correct, but Watch Out for the Revision Impact

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>The review period for the <a href="https://www.smartkarma.com/entities/nikkei-225" target="_blank" data-smartkarma-citation="entities:22909:1" rel="noopener">Nikkei 225 Index</a> September rebalance ends in three weeks. There could be three changes at the rebalance with sector balance used for the additions.</li>
<li>Depending on the changes, passive trackers will need to buy between 3-57x ADV (2.4%-24% of real float) on the inclusions and sell between 3.7-8.4x ADV on the deletions.</li>
<li>
<a href="https://www.smartkarma.com/entities/fast-retailing-co-ltd" target="_blank" data-smartkarma-citation="entities:751:1" rel="noopener">Fast Retailing (9983 JP)</a>'s index weight is currently higher than 10% and that will result in capping in September. Passives will need to sell 6x ADV in the stock.</li>
</ul>


The review period for the Nikkei 225 Index September rebalance ends in three weeks. There could be three changes at the rebalance with sector balance used for the additions.
Depending on the changes, passive trackers will need to buy between 3-57x ADV (2.4%-24% of real float) on the inclusions and sell between 3.7-8.4x ADV on the deletions.

Fast Retailing (9983 JP)'s index weight is currently higher than 10% and that will result in capping in September. Passives will need to sell 6x ADV in the stock.


Nikkei 225 Index Rebalance Preview (Sep 2024): Potential Adds/Deletes, Capping & Funding Changes

<ul>
<li>KKR raised around US$730m via selling some stake in <a href="https://www.smartkarma.com/entities/kokusai-electric-corp" target="_blank" data-smartkarma-citation="entities:40152:1" rel="noopener">Kokusai Electric (6525 JP)</a> Japan IPO in Sep 2023. Its remaining stake will be released from its IPO linked lockup soon.</li>
<li>KE main business activities consist of the manufacturing, sales and maintenance service of semiconductor manufacturing equipment.</li>
<li>In this note, we talk about the upcoming lock-up expiry and possible deal dynamics.</li>
</ul>


KKR raised around US$730m via selling some stake in Kokusai Electric (6525 JP) Japan IPO in Sep 2023. Its remaining stake will be released from its IPO linked lockup soon.
KE main business activities consist of the manufacturing, sales and maintenance service of semiconductor manufacturing equipment.
In this note, we talk about the upcoming lock-up expiry and possible deal dynamics.


Kokusai Electric IPO Lock-Up - KKR Will Be Tempted by the US$2.7bn Release but Might Have to Wait

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Equity Bottom-Up

<ul>
<li>Telecom companies are traditionally "easy" to value. They have assets, debt, depreciation, earnings, cashflow. Lots of people like to use EV/EBITDA to measure.</li>
<li>In comparing Japan's telcos, I believe when <a href="https://www.smartkarma.com/entities/softbank-corp" target="_blank" data-smartkarma-citation="entities:27445:1" rel="noopener">Softbank Corp (9434 JP)</a> is in the mix, one has to use forward PERs. EV/EBITDA is too fraught with complications.</li>
<li>Softbank is currently at its most expensive multiple since listing on a Price to Forward Earnings basis, and relative to its major Peers. And KDDI has a big buyback now.</li>
</ul>


Telecom companies are traditionally "easy" to value. They have assets, debt, depreciation, earnings, cashflow. Lots of people like to use EV/EBITDA to measure.
In comparing Japan's telcos, I believe when Softbank Corp (9434 JP) is in the mix, one has to use forward PERs. EV/EBITDA is too fraught with complications.
Softbank is currently at its most expensive multiple since listing on a Price to Forward Earnings basis, and relative to its major Peers. And KDDI has a big buyback now.


Softbank Corp (9434) - Accounting for the Accounting Is Complicated Redux - So Be Bearish

<ul>
<li>A group of shareholders aims to raise up to US$3.2bn via selling around 5% of <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 possibility of such a selldown was flagged earlier in the week by Reuters. Thus, the deal is well flagged.</li>
<li>In this note, we will talk about the placement and run the deal through our ECM framework.</li>
</ul>


A group of shareholders aims to raise up to US$3.2bn via selling around 5% of Honda Motor (7267 JP) .
The possibility of such a selldown was flagged earlier in the week by Reuters. Thus, the deal is well flagged.
In this note, we will talk about the placement and run the deal through our ECM framework.


Honda Motor Placement - Large in Size, Relatively Small in Other Terms

Japan

SoftBank Group Corp. provides telecommunication services. The Company also operates ADSL (Asymmetric Digital Subscriber Line) and fiber optic high-speed Internet connection, e-Commerce businesses, and Internet based advertising and auction businesses.

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Softbank Group (9984 JP)

ASICS Placement - Needs to Correct, but Watch Out for the Revision Impact

A group of shareholders aims to raise around US$1.3bn via selling around 11% of ASICS Corp (7936 JP). In this note, we talk about the deal dynamics.

Sumeet Singh

Nikkei 225 Index Rebalance Preview (Sep 2024): Potential Adds/Deletes, Capping & Funding Changes

We forecast 3 changes for the NKY in September with sector balance determining the inclusions. Fast Retailing will be capped at 10%. Passives need...

Brian Freitas

Kokusai Electric IPO Lock-Up - KKR Will Be Tempted by the US$2.7bn Release but Might Have to Wait

As per media reports, KKR is considering sell half its stake in Kokusai, with the company planning to buyback some shares as well. The company has...

Sumeet Singh

Softbank Corp (9434) - Accounting for the Accounting Is Complicated Redux - So Be Bearish

Accounting for all the adjustments needed in EV (and EBITDA) in constructing a fair value for Softbank Corp means one should use forward PER. In...

Travis Lundy

Honda Motor Placement - Large in Size, Relatively Small in Other Terms

A group of shareholders aims to raise up to US$3.2bn via selling around 5% of Honda Motor (7267 JP). In this note, we talk about the deal dynamics...

Sumeet Singh

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