Asian Equities Analyst, Logistics & Transport, Tracking Traffic

Daniel Hellberg

Asian Equities Analyst, Logistics & Transport

Tracking Traffic

Focusing on Asian logistics, transportation, and travel companies

Equity Bottom-Up

<section class="figure"><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/178/841/original/BANNER-LOGISTICS.png?1608076389" class="editor-image img-responsive" data-smartkarma-image-id="178841"></figure></section><p>While still solid, YoY express parcel volume growth in China moderated somewhat in November. Slower growth came as a surprise, as November includes the big "11-11" online shopping holiday. </p><p>An ongoing price war drove down ASPs in November (again). We don't believe companies can offset YoY price declines of 20-30% with unit cost reductions, so margins are likely falling (again). </p><p>Our investment thesis for Chinese express is that growing financial pressures will result in consolidation in 2021. Under this scenario, struggling <a href="https://www.smartkarma.com/entities/best-inc" target="_blank" data-smartkarma-citation="entities:25494:1" rel="noopener">BEST Inc (BEST US)</a>, closely aligned with Alibaba's logistics efforts, becomes a potential acquisition target. We rate Best BUY.</p>

While still solid, YoY express parcel volume growth in China moderated somewhat in November. Slower growth came as a surprise, as November includes the big "11-11" online shopping holiday. An ongoing price war drove down ASPs in November (again). We don't believe companies can offset YoY price declines of 20-30% with unit cost reductions, so margins are likely falling (again). Our investment thesis for Chinese express is that growing financial pressures will result in consolidation in 2021. Under this scenario, struggling BEST Inc (BEST US), closely aligned with Alibaba's logistics efforts, becomes a potential acquisition target. We rate Best BUY.

TRACKING TRAFFIC/Chinese Express: Volume Growth Moderates | Pricing Stays Depressed

Overseas Chinese Equities, Aequitas Research

Ming Lu

Overseas Chinese Equities

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>China Audio-Video and Digital Publishing Association announced <em>the Age Rating of Online Game</em>.</li>
<li>Many online platforms stopped selling cash deposit products.</li>
<li>Online payment amount grew by 28% YoY on the shopping season “December 12”.</li>
</ul>


China Audio-Video and Digital Publishing Association announced the Age Rating of Online Game.
Many online platforms stopped selling cash deposit products.
Online payment amount grew by 28% YoY on the shopping season “December 12”.


China Internet Weekly (21Dec2020): Online Games Rated by Age, Online Platforms Banned from Deposit

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

Equity Capital Markets

<div>
<p>Earlier this year Education Australia Ltd, raised  US$153m (A$225m) via selling a 5.1% stake in <a href="https://www.smartkarma.com/entities/idp-education-ltd" target="_blank" data-smartkarma-citation="entities:1098:1" rel="noopener">IDP Education (IEL AU)</a>. The lock-up from that deal is about to end.</p>
<p>Education Australia is the largest shareholder for IDP and since the last selldown it has launched a formal review of the rest of its stake.  In this insight, I'll take an early look at the possible block/blocks that could be on the way. </p>
</div><div>
<p>We have followed the company since it listed in Nov 2015, links to our earlier notes are below:</p>
<ul>
<li>
<a href="https://www.smartkarma.com/insights/ipo-preview-growing-market-and-strategic-co-owner-combined-with-a-global-brand-means-its-set-to-fly" target="_blank" rel="noopener">IPO Preview:Growing market and strategic co-owner combined with a global brand means its set to fly, </a>  </li>
<li><a href="https://www.smartkarma.com/insights/quick-note-global-brand-at-an-attractive-price" target="_blank" rel="noopener">Quick Note: Global brand at an attractive price,</a></li>
<li><a href="https://www.smartkarma.com/insights/idp-education-first-test-them-then-place-them" target="_blank" rel="noopener">IDP Education: First Test Them, Then Place Them,</a></li>
<li><a href="https://www.smartkarma.com/insights/idp-education-placement-testing-times-but-it-will-pass-probably-with-flying-colours" target="_blank" rel="noopener">IDP Education Placement: Testing Times but It Will Pass, Probably with Flying Colours,</a></li>
<li><a href="https://www.smartkarma.com/insights/idp-education-placement-last-deal-was-a-smash-hit-this-one-won-t-be-as-lucky" target="_blank" rel="noopener">IDP Education Placement - Last Deal Was a Smash Hit, This One Won’t Be as Lucky</a></li>
</ul>
</div>


Earlier this year Education Australia Ltd, raised  US$153m (A$225m) via selling a 5.1% stake in IDP Education (IEL AU). The lock-up from that deal is about to end.
Education Australia is the largest shareholder for IDP and since the last selldown it has launched a formal review of the rest of its stake.  In this insight, I'll take an early look at the possible block/blocks that could be on the way. 

We have followed the company since it listed in Nov 2015, links to our earlier notes are below:


IPO Preview:Growing market and strategic co-owner combined with a global brand means its set to fly,   
Quick Note: Global brand at an attractive price,
IDP Education: First Test Them, Then Place Them,
IDP Education Placement: Testing Times but It Will Pass, Probably with Flying Colours,
IDP Education Placement - Last Deal Was a Smash Hit, This One Won’t Be as Lucky



IDP Education Placement Early Look - A Big Block/Whole Lot of Blocks Could Be Coming

ASEAN Insight Provider, CrossASEAN Research

Angus Mackintosh

ASEAN Insight Provider

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

Private Capital Markets

<p><a href="https://www.smartkarma.com/entities/tokopedia-pt" target="_blank" data-smartkarma-citation="entities:24239:1" rel="noopener">Tokopedia PT (1087142D IJ)</a> has confirmed that it has hired Morgan Stanley and Citigroup as advisers to help accelerate its plan to go public. The company has not yet decided which route to take to come to market, whether through a straightforward IPO or a SPAC listing, potentially through Richard Li and Peter Thiel's Bridgetown Holdings Ltd.</p>
<p>The company had previously stated that it would definitely seek a listing in its home market of Indonesia, with a potential dual listing in the US, although these statements were made pre-pandemic. </p>
<p>Valuations for <a href="https://www.smartkarma.com/entities/tokopedia-pt" target="_blank" data-smartkarma-citation="entities:24239:1" rel="noopener">Tokopedia PT (1087142D IJ)</a> range from US$8-10bn, although after the last round of funding it was valued at US$7.5bn, making it Indonesia's second most valuation start-up after <a href="https://www.smartkarma.com/entities/gojek" target="_blank" data-smartkarma-citation="entities:25976:1" rel="noopener">Gojek (1379371D IJ)</a>, which was last valued at US$10bn.</p>
<p>An IPO would help the company realize a higher valuation, providing a currency to drive future growth, given it would be an alternative to <a href="https://www.smartkarma.com/entities/sea-ltd" target="_blank" data-smartkarma-citation="entities:8509:1" rel="noopener">Sea Ltd (SE US), </a>as the number 2 e-commerce player in Indonesia. <a href="https://www.smartkarma.com/entities/sea-ltd" target="_blank" data-smartkarma-citation="entities:8509:1" rel="noopener">Sea Ltd (SE US)</a> trades at 13x FY21E EV/Sales currently and just raised more than US$2bn through a placement of new ADS's. We look at <a href="https://www.smartkarma.com/entities/tokopedia-pt" target="_blank" data-smartkarma-citation="entities:24239:1" rel="noopener">Tokopedia PT (1087142D IJ)</a> and its positioning in more detail below the fold. </p>

Tokopedia PT (1087142D IJ) has confirmed that it has hired Morgan Stanley and Citigroup as advisers to help accelerate its plan to go public. The company has not yet decided which route to take to come to market, whether through a straightforward IPO or a SPAC listing, potentially through Richard Li and Peter Thiel's Bridgetown Holdings Ltd.
The company had previously stated that it would definitely seek a listing in its home market of Indonesia, with a potential dual listing in the US, although these statements were made pre-pandemic. 
Valuations for Tokopedia PT (1087142D IJ) range from US$8-10bn, although after the last round of funding it was valued at US$7.5bn, making it Indonesia's second most valuation start-up after Gojek (1379371D IJ), which was last valued at US$10bn.
An IPO would help the company realize a higher valuation, providing a currency to drive future growth, given it would be an alternative to Sea Ltd (SE US), as the number 2 e-commerce player in Indonesia. Sea Ltd (SE US) trades at 13x FY21E EV/Sales currently and just raised more than US$2bn through a placement of new ADS's. We look at Tokopedia PT (1087142D IJ) and its positioning in more detail below the fold. 

Tokopedia PT (1087142D IJ) - From Private to Public by Hook or by Crook

Chief Economist

Diana Choyleva

Enodo Economics

Enodo Economics is an independent macroeconomic forecasting company that untangles complexity, challenges the consensus, and makes sense of the future. Our focus is on China – one of the most misunderstood economies in the world, but one of the most important to figure out.  Enodo’s chief economist, Diana Choyleva, has been analysing China for almost 20 years, while Enodo’s team boasts a combined 140 years’ experience covering China’s economy, politics and markets. 

Macroeconomics

<h2>China News That Matters</h2><ul>
<li>WHO to visit Wuhan, finally</li>
<li>So much to sell, so few containers to use</li>
<li>Cheap veg! Sign up now!</li>
<li>Toymaker Pop Mart has winning formula, for now</li>
</ul><div class="content-remarks"><p>In my weekly digest China News That Matters, I will give you selected summaries, sourced from a variety of local Chinese-language and international news outlets, and highlight why I think the news is significant. These posts are meant to neither be bullish nor bearish, but help you separate the signal from the noise.</p></div>

China News That Matters
WHO to visit Wuhan, finally
So much to sell, so few containers to use
Cheap veg! Sign up now!
Toymaker Pop Mart has winning formula, for now
In my weekly digest China News That Matters, I will give you selected summaries, sourced from a variety of local Chinese-language and international news outlets, and highlight why I think the news is significant. These posts are meant to neither be bullish nor bearish, but help you separate the signal from the noise.

China

Alibaba Group Holding Limited provides online sales services. The Company provides internet infrastructure, electronic commerce, online financial, and internet content services through its subsidiaries. Alibaba Group Holding offers its products and services worldwide.

Price Gauge
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Alibaba Group Holding (BABA US)

TRACKING TRAFFIC/Chinese Express: Volume Growth Moderates | Pricing Stays Depressed

Recent strong volume growth moderated in November, and express industry revenue growth lagged the performance of leading eComm platforms....

Tracking Traffic

China Internet Weekly (21Dec2020): Online Games Rated by Age, Online Platforms Banned from Deposit

Authorities announced the Age Rating of Online Game. Many online platforms stopped selling cash deposit products. Online payment amount grew by 28%...

Ming Lu

IDP Education Placement Early Look - A Big Block/Whole Lot of Blocks Could Be Coming

Earlier this year Education Australia Ltd, raised US$153m via selling a 5.1% stake in IDP Education (IEL AU). The lock-up from that deal is about...

Sumeet Singh

Tokopedia PT (1087142D IJ) - From Private to Public by Hook or by Crook

Tokopedia has confirmed that it is looking to go public and has enlisted Investment Banks to speed the process. This will give investors an...

Angus Mackintosh

Covid-19/ Economy/ Group Buying/ IPOs

In my weekly digest, I will give you selected summaries, sourced from a variety of local Chinese-language and international news outlets, and...

Diana Choyleva

Price Gauge

52-week Range

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