APAC IPOs & Placements, Aequitas Research

Clarence Chu

APAC 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

Fortescue Metals / Equity Capital Markets

<ul>
<li>An undisclosed shareholder is looking to raise US$1.25bn (A$1.91bn) from selling some stake in <a href="https://www.smartkarma.com/entities/fortescue-metals-group-ltd" target="_blank" data-smartkarma-citation="entities:41:1" rel="noopener">Fortescue Metals (FMG AU)</a>.</li>
<li>The deal is a large one to digest at 13 days of the stock’s three month ADV. The selling shareholder will be locked up for 45 days.</li>
<li>In this note, we run the deal through our ECM framework and comment on deal dynamics.</li>
</ul>


An undisclosed shareholder is looking to raise US$1.25bn (A$1.91bn) from selling some stake in Fortescue Metals (FMG AU).
The deal is a large one to digest at 13 days of the stock’s three month ADV. The selling shareholder will be locked up for 45 days.
In this note, we run the deal through our ECM framework and comment on deal dynamics.


Fortescue Placement - Discount Appears Attractive, but Momentum Has Been Very Weak

Breaking Down the Mining News of the Day, Money of Mine

Money of Mine

Breaking Down the Mining News of the Day

An ex-underground miner, an ex-investment banker, and an ex-equity research guy breaking down the mining news of the day. It's a bit of entertainment, information, and occasionally some alpha.

Equity Bottom-Up

<ul>
<li>Fortescue Metals Group experienced a significant block trade worth $1.1 billion, leading to a 6% discount in their stock price</li>
<li>Potential sellers include Hunan Iron and Steel Group, Vallon Holdings, and Capital Group, with speculation on the reasons behind the sale</li>
<li>The geopolitical situation in Niger, with ongoing conflicts involving French, US, and Russian forces against Islamist militants, is a topic of interest and discussion among the group</li>
</ul>
<p><em>This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.</em></p>


Fortescue Metals Group experienced a significant block trade worth $1.1 billion, leading to a 6% discount in their stock price
Potential sellers include Hunan Iron and Steel Group, Vallon Holdings, and Capital Group, with speculation on the reasons behind the sale
The geopolitical situation in Niger, with ongoing conflicts involving French, US, and Russian forces against Islamist militants, is a topic of interest and discussion among the group

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

Equity, Bottom-up Analyst, Investics Research

Sameer Taneja

Equity, Bottom-up Analyst

Investics Research

It is important to note that the information provided by Investics Research is based on publicly available data and own knowledge, which has been gathered and analyzed from a variety of sources. While every effort has been made to ensure the accuracy and completeness of the information provided, it is not guaranteed to be free from errors or omissions. All forecasts and estimates are based on information that has been obtained from public sources that are considered to be reliable. The sources include but are not limited to, company announcements, exchange filings, presentations, etc. Investics does not guarantee the accuracy and completeness of the forecasts, estimates, and/or other information.

Equity Bottom-up Research

<ul>
<li>In the world of 8-10% dividend-yielding commodities, <a href="https://www.smartkarma.com/entities/fortescue-metals-group-ltd" target="_blank" data-smartkarma-citation="entities:41:1" rel="noopener">Fortescue Metals (FMG AU)</a> almost makes the cut. We would wait for a better entry point here despite iron ore strength.</li>
<li>We are also mindful of the risks associated with capex in the green energy space to achieve zero emissions and ramp costs with the recent production increase.</li>
<li>We believe numbers are at par, trading at 9.6x PE on the current spot price (130 USD/ton) with a 7% dividend yield ( assuming a 65% payout ratio). </li>
</ul>


In the world of 8-10% dividend-yielding commodities, Fortescue Metals (FMG AU) almost makes the cut. We would wait for a better entry point here despite iron ore strength.
We are also mindful of the risks associated with capex in the green energy space to achieve zero emissions and ramp costs with the recent production increase.
We believe numbers are at par, trading at 9.6x PE on the current spot price (130 USD/ton) with a 7% dividend yield ( assuming a 65% payout ratio). 


Fortescue Metals (FMG AU): 8% Yield At Spot Price With Risks, Wait For Better Entry Point

Commodities

<ul>
<li>We like <a href="https://www.smartkarma.com/entities/vale-sa" target="_blank" data-smartkarma-citation="entities:23731:1" rel="noopener">Vale (VALE US)</a> for its exposure to high-grade iron ore (95% of EBITDA) and capital return discipline, with a current dividend yield of 8% and 3.5x EV-EBITDA. </li>
<li>The cash flows from the iron ore business could be used to invest in base metals, such as copper, nickel, etc., to enhance the portfolio. </li>
<li>The key risk remains the overhang from the Mariana Dam disaster being settled for  ~25.7 billion USD (vs. the current market cap of 50 billion USD). </li>
</ul>


We like Vale (VALE US) for its exposure to high-grade iron ore (95% of EBITDA) and capital return discipline, with a current dividend yield of 8% and 3.5x EV-EBITDA. 
The cash flows from the iron ore business could be used to invest in base metals, such as copper, nickel, etc., to enhance the portfolio. 
The key risk remains the overhang from the Mariana Dam disaster being settled for  ~25.7 billion USD (vs. the current market cap of 50 billion USD). 


VALE US: Exposure to High-Grade Iron Ore With >8% Dividend Yield

<ul>
<li>We initiated on the iron ore space recently with a short-term bullish call (see: <a href="https://www.smartkarma.com/insights/iron-ore-primer-understanding-the-drivers-of-the-market-ways-to-play-the-sector" target="_blank" data-smartkarma-citation="insights:136452" rel="noopener">Iron Ore Primer: Understanding The Drivers Of the Market, Ways To Play The Sector</a>). </li>
<li>Check out our initiation on  <a href="https://www.smartkarma.com/insights/mount-gibson-mgx-au-iron-ore-pure-play-77-of-the-mkt-cap-in-cash-0-5x-ev-ebitda-with-catalysts" target="_blank" data-smartkarma-citation="insights:136941" rel="noopener">Mount Gibson (MGX AU): Iron Ore Pure Play, 77% of the Mkt Cap in Cash, 0.5x EV-EBITDA With Catalysts</a> ).</li>
<li>Iron ore has a more short-term upside as it bounces off the cost curve in its three-year band (95-130 USD/ton), while China has demonstrated an abundant appetite for restocking. </li>
</ul>


We initiated on the iron ore space recently with a short-term bullish call (see: Iron Ore Primer: Understanding The Drivers Of the Market, Ways To Play The Sector). 
Check out our initiation on  Mount Gibson (MGX AU): Iron Ore Pure Play, 77% of the Mkt Cap in Cash, 0.5x EV-EBITDA With Catalysts ).
Iron ore has a more short-term upside as it bounces off the cost curve in its three-year band (95-130 USD/ton), while China has demonstrated an abundant appetite for restocking. 


Iron Ore Comes Roaring Back! BHP-Anglo, VALE, FMG: What's Hot In the Space

Australia

Fortescue Metals Group Ltd. explores for and produces iron ore. The Company conducts business worldwide.

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Fortescue Metals (FMG AU)

Fortescue Placement - Discount Appears Attractive, but Momentum Has Been Very Weak

An undisclosed shareholder is looking to raise US$1.25bn (A$1.91bn) from selling some stake in Fortescue Metals (FMG AU).

Clarence Chu

Who’s Dumping FMG Stock?

Discussion on uranium geopolitics and potential site visits, analyst interests in gold, oil, and gas, Fortescue block trade, speculation on sellers...

Money of Mine