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

Airbnb aims to raise around US$2.5bn in its US listing. Airbnb is a global short-stay offering platform. To put it simply, iIt connects hosts, who post available accommodation on Airbnb, with guests, who make bookings for the accommodation. It charges a fee for this service.As of 9M20, it had 4 million hosts in more than 220 countries and regions around the world. Since inception, its hosts have welcomed over 825m guest arrivals and have cumulatively earned over $110bn. In 2019, it had 54m active bookers worldwide, who booked 327m nights and experiences on Airbnb.Over 2017-19, the company reported steady growth in earnings led by an increase in the number of bookings. Its overall number of guests and hosts have been growing as well, with most metrics heading in the right direction. While COVID-19 did take a harsh toll on the company, its quarterly results paint a better picture as compared to its 9M20 numbers. Even during COVID, there have been certain pockets, like domestic and long stay travel which have continued to grow, thus, highlighting the company’s resilience. Having said that, Airbnb has failed to explain the reason for the downwards pressure on its 2019 margins. At the same time, the cohorts data highlights the ample other options available to its guests and the severe competition in the industry.

Airbnb aims to raise around US$2.5bn in its US listing. Airbnb is a global short-stay offering platform. To put it simply, iIt connects hosts, who post available accommodation on Airbnb, with guests, who make bookings for the accommodation. It charges a fee for this service.As of 9M20, it had 4 million hosts in more than 220 countries and regions around the world. Since inception, its hosts have welcomed over 825m guest arrivals and have cumulatively earned over $110bn. In 2019, it had 54m active bookers worldwide, who booked 327m nights and experiences on Airbnb.Over 2017-19, the company reported steady growth in earnings led by an increase in the number of bookings. Its overall number of guests and hosts have been growing as well, with most metrics heading in the right direction. While COVID-19 did take a harsh toll on the company, its quarterly results paint a better picture as compared to its 9M20 numbers. Even during COVID, there have been certain pockets, like domestic and long stay travel which have continued to grow, thus, highlighting the company’s resilience. Having said that, Airbnb has failed to explain the reason for the downwards pressure on its 2019 margins. At the same time, the cohorts data highlights the ample other options available to its guests and the severe competition in the industry. 

Airbnb IPO - Time for a Good Break - Even from the Share Lock-Up

Equity Analyst, LightStream Research

Supun Walpola

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Equity Bottom-Up

<a href="https://www.smartkarma.com/entities/zozo-inc" target="_blank" data-smartkarma-citation="entities:18379:1" rel="noopener">ZOZO Inc (3092 JP)</a>’s growth has quickly returned to its decelerating trend post-lockdowns and we believe this will become more evident from 3Q FY03/21 when the impact of the stay-at-home demand further subsides. The underlying reasons for this collapsing growth such as, the saturation of the under-25 segment, weak penetration among the middle-aged demographic, and falling average price levels, does not seem to be improving, hence, we believe ZOZO’s consignment business growth should not be much higher than the overall online fashion market growth of 5%-10% going forward.In the meantime, there is still a lot of uncertainty surrounding ZOZO’s longer-term growth drivers such as the new ZOZOSUIT 2 and the private label business which are still in their experimental phase. ZOZO is already down 20% from early October, however, we believe a further correction is required to justify ZOZO’s single-digit growth in the medium-term, until the new initiatives start making meaningful contributions to the results.

ZOZO Inc (3092 JP)’s growth has quickly returned to its decelerating trend post-lockdowns and we believe this will become more evident from 3Q FY03/21 when the impact of the stay-at-home demand further subsides. The underlying reasons for this collapsing growth such as, the saturation of the under-25 segment, weak penetration among the middle-aged demographic, and falling average price levels, does not seem to be improving, hence, we believe ZOZO’s consignment business growth should not be much higher than the overall online fashion market growth of 5%-10% going forward.In the meantime, there is still a lot of uncertainty surrounding ZOZO’s longer-term growth drivers such as the new ZOZOSUIT 2 and the private label business which are still in their experimental phase. ZOZO is already down 20% from early October, however, we believe a further correction is required to justify ZOZO’s single-digit growth in the medium-term, until the new initiatives start making meaningful contributions to the results.

2021 High Conviction: ZOZO – Good Times Are Zo Far Away

TMT & Consumer Independent Equity Research Analyst, Obex Capital Research

Aaron Gabin

TMT & Consumer Independent Equity Research Analyst

TMT & Consumer Independent Equity Research

Obex Capital Research

“Obex” is Latin for Barriers to Entry. Obex Capital Management’s investment philosophy is driven by an intense focus on which business model’s Barriers to Entry are able to withstand the ever increasing competitive disruption in the TMT and Consumer Sectors.

Snowflake had a good quarter…it was a bit above expectations that were well telegraphed from the IPO, and their guidance was only inline (though likely conservative)….so what does one do with a stock that is the single richest multiple in the stock market (100x+ sales)? Buy a lot more? We can’t pretend to understand why this stock was up 16% today. And we can’t pretend to understand why the market values its revenues at 3x!!! the rest of high valuation software. We don’t short on valuation alone. But we certainly couldn’t justify owning Snowflake. <div class="content-highlight">Obex’s fundamental research process is focused on secular change in the TMT and Consumer sectors. We seek to differentiate between fundamental business analysis and security analysis. Before deciding if a security’s pricing and positioning merit a long or short position, we analyze the four pillars of business fundamentals (Secular Factors, TAM, Competitive Advantage, Business Model) in order to determine if this is a “good” or “not so good” opportunity.</div>

Snowflake had a good quarter…it was a bit above expectations that were well telegraphed from the IPO, and their guidance was only inline (though likely conservative)….so what does one do with a stock that is the single richest multiple in the stock market (100x+ sales)? Buy a lot more? We can’t pretend to understand why this stock was up 16% today. And we can’t pretend to understand why the market values its revenues at 3x!!! the rest of high valuation software. We don’t short on valuation alone. But we certainly couldn’t justify owning Snowflake. Obex’s fundamental research process is focused on secular change in the TMT and Consumer sectors. We seek to differentiate between fundamental business analysis and security analysis. Before deciding if a security’s pricing and positioning merit a long or short position, we analyze the four pillars of business fundamentals (Secular Factors, TAM, Competitive Advantage, Business Model) in order to determine if this is a “good” or “not so good” opportunity.

Snowflake 3Q21: Our Revenues Are Worth More Than Your Revenues

Asia Consumer Research, Investory

Devi Subhakesan

Asia Consumer Research

ASIA CONSUMER: INSIGHTS AND INVESTMENT IDEAS

Investory

Investory is a Singapore-based boutique independent equity research firm founded in January 2017 with a primary focus on consumption themes across Asia-Pacific.

We aim to generate investible ideas based on consumption trends and outlook. We screen our ideas on several parameters - product potential, long-term growth and management commitment being the most critical.  We follow a fundamental analysis approach in our stock selection process and are not restricted by market cap.

We aspire to grow into a leading source of unbiased research, free of conflict of interest, for investors yearning for independent and disciplined analysis. 

We also undertake bespoke research mandates to support our Institutional clients’ investment needs.

Our team comprises of professionals with extensive experience in the Asian equity markets, in areas ranging from research, servicing institutional clients and investment management.

Private Capital Markets

Tatas, India's leading Conglomerate business group, is <a href="https://www.bloomberg.com/news/articles/2020-12-02/tata-said-near-deal-to-buy-alibaba-backed-indian-online-grocer?sref=SVEekGzB" target="_blank" rel="noopener">reportedly</a> in talks to acquire 80% stake in the country's leading Online grocery vertical Bigbasket, where <a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd" target="_blank" data-smartkarma-citation="entities:787:1" rel="noopener">Alibaba Group (BABA US)</a> holds upto 30% of ownership stake. India's Retail sector has been a hot bed of M&amp;A activity (and litigations) involving  the big and mighty over the recent months. India's nascent online grocery retail nearly doubled in sales this year thanks to COVID-led disruptions in physical retail. Existing online verticals, <a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd" target="_blank" data-smartkarma-citation="entities:787:1" rel="noopener">Alibaba Group (BABA US)</a> backed Bigbasket and <a href="https://www.smartkarma.com/entities/softbank-group-corp" target="_blank" data-smartkarma-citation="entities:315:1" rel="noopener">Softbank Group (9984 JP)</a> backed Grofers were reportedly planning a fresh round of  fund raising to build up infrastructure to cater to the swelling demand and counter rising competition. However, all's not been well with overseas fund raising in India. In the detailed note below, we look at (1) Reported deal specifics and valuation (2) Likely Rationale behind the deal (3) India's nascent online grocery landscape and (4) how COVID and consolidation have been impacting India's e-grocery sector.

Tatas, India's leading Conglomerate business group, is reportedly in talks to acquire 80% stake in the country's leading Online grocery vertical Bigbasket, where Alibaba Group (BABA US) holds upto 30% of ownership stake. India's Retail sector has been a hot bed of M&amp;A activity (and litigations) involving  the big and mighty over the recent months. India's nascent online grocery retail nearly doubled in sales this year thanks to COVID-led disruptions in physical retail. Existing online verticals, Alibaba Group (BABA US) backed Bigbasket and Softbank Group (9984 JP) backed Grofers were reportedly planning a fresh round of  fund raising to build up infrastructure to cater to the swelling demand and counter rising competition. However, all's not been well with overseas fund raising in India. In the detailed note below, we look at (1) Reported deal specifics and valuation (2) Likely Rationale behind the deal (3) India's nascent online grocery landscape and (4) how COVID and consolidation have been impacting India's e-grocery sector.

BABA Backed BigBasket to Go to TATAs: Round 2 of India Retail Sector M&A

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Wish is getting ready to complete its IPO in the U.S. by the end of this year. Wish is among the four major U.S. tech related IPOs, including Airbnb, DoorDash, and Roblox that are trying to complete their IPOs by the end of this year. All four of these IPOs are outstanding companies with superior business models. DoorDash and Airbnb are seeking $30 billion or more in valuation. Wish is seeking valuation in the $25 billion to $30 billion or more, and Roblox's IPO could fetch at least $10 billion to $15 billion or more. In other words, the U.S. tech IPO market is likely to end with a Bang rather than a Whimper. Wish has put an IPO placeholder at $1 billion but this figure is likely to be revised up materially.Wish is an e-commerce platform founded by an ex-Google engineer Piotr Szulczewski (CEO) and Danny Zhang (former CTO). These two founders are college buddies from the University of Waterloo.<a href="https://www.forbes.com/sites/parmyolson/2019/03/13/meet-the-billionaire-who-defied-amazon-and-built-wish-the-worlds-most-downloaded-e-commerce-app/" target="_blank" rel="noopener"> Szulczewski</a> was 11 years old when his parents immigrated to Canada from Poland when the Soviet Union collapsed. Early on his career, the founder Piotr Szulczewski worked at Google for about a decade, including spending some time in South Korea. Szulczewski left Google in 2009 and formed Wish a year later. Back in 2016, Amazon gave an interest to acquire Wish (amount unspecified) but Szulczewski turned it down. Good for him since he is now worth a lot more than if he had taken that offer.Wish's is focused on serving customers whose number one priority is price.

Wish is getting ready to complete its IPO in the U.S. by the end of this year. Wish is among the four major U.S. tech related IPOs, including Airbnb, DoorDash, and Roblox that are trying to complete their IPOs by the end of this year. All four of these IPOs are outstanding companies with superior business models. DoorDash and Airbnb are seeking $30 billion or more in valuation. Wish is seeking valuation in the $25 billion to $30 billion or more, and Roblox's IPO could fetch at least $10 billion to $15 billion or more. In other words, the U.S. tech IPO market is likely to end with a Bang rather than a Whimper. Wish has put an IPO placeholder at $1 billion but this figure is likely to be revised up materially.Wish is an e-commerce platform founded by an ex-Google engineer Piotr Szulczewski (CEO) and Danny Zhang (former CTO). These two founders are college buddies from the University of Waterloo. Szulczewski was 11 years old when his parents immigrated to Canada from Poland when the Soviet Union collapsed. Early on his career, the founder Piotr Szulczewski worked at Google for about a decade, including spending some time in South Korea. Szulczewski left Google in 2009 and formed Wish a year later. Back in 2016, Amazon gave an interest to acquire Wish (amount unspecified) but Szulczewski turned it down. Good for him since he is now worth a lot more than if he had taken that offer.Wish's is focused on serving customers whose number one priority is price.

United States

Amazon.com, Inc. is an online retailer that offers a wide range of products. The Company's products include books, music, videotapes, computers, electronics, home and garden, and numerous other products.  Amazon offers personalized shopping services, Web-based credit card payment, and direct shipping to customers.

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Amazon.com Inc (AMZN US)

2021 High Conviction: ZOZO – Good Times Are Zo Far Away

ZOZO is already down 20% from early October, however, we believe a further correction is required to justify ZOZO’s single-digit growth in the...

Supun Walpola

Snowflake 3Q21: Our Revenues Are Worth More Than Your Revenues

Snowflake's first public quarter was a raging success according to the stock market, who boosted a 100x P/S company by 16% just for meeting...

Aaron Gabin

BABA Backed BigBasket to Go to TATAs: Round 2 of India Retail Sector M&A

Alibaba backed India eGrocer, BigBasket, to be sold to Tatas. Reported valuation multiples imply a discount vs last round of funding. Despite...

Devi Subhakesan

Wish IPO Preview

Wish has become the most downloaded global shopping app for each of the last three years. Wish is one of the most highly anticipated IPOs in the...

Douglas Kim

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Airbnb IPO - Time for a Good Break - Even from the Share Lock-Up

Airbnb aims to raise around US$2.5bn in its US listing. There is lots to like about the company, apart from it lack of lock-up on some shareholders.

Sumeet Singh

2021 High Conviction: ZOZO – Good Times Are Zo Far Away

ZOZO is already down 20% from early October, however, we believe a further correction is required to justify ZOZO’s single-digit growth in the...

Supun Walpola

Snowflake 3Q21: Our Revenues Are Worth More Than Your Revenues

Snowflake's first public quarter was a raging success according to the stock market, who boosted a 100x P/S company by 16% just for meeting...

Aaron Gabin

BABA Backed BigBasket to Go to TATAs: Round 2 of India Retail Sector M&A

Alibaba backed India eGrocer, BigBasket, to be sold to Tatas. Reported valuation multiples imply a discount vs last round of funding. Despite...

Devi Subhakesan

Wish IPO Preview

Wish has become the most downloaded global shopping app for each of the last three years. Wish is one of the most highly anticipated IPOs in the...

Douglas Kim