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

Equity Bottom-Up

<p><a href="https://www.smartkarma.com/entities/sea-ltd" target="_blank" data-smartkarma-citation="entities:8509:1" rel="noopener">Sea Ltd (SE US)</a> announced yet another record set of quarterly results last night, with +159% growth in total GAAP revenues to US$2,280.6m. This marks the 12th consecutive quarter of triple-digit growth in revenues, which deserves a standing ovation</p>
<p>The company's digital entertainment business continued to thrive, with quarterly active users (QAU) increasing by +45% YoY and importantly quarterly paying users increasing +85% YoY in 2Q2021, and generating positive EBITDA of US$740.9m.</p>
<p>The quarterly paying users represented a higher portion of users in 2Q2021 and Adjusted EBITDA as a portion of bookings improved to 62.8% for 2Q2021 versus 60.9% in 2Q2020.</p>
<p>Garena's self-developed global hit game <em>Free Fire </em>reached over 1bn downloads on Google Play, with the game ranking number three globally by average monthly users for mobile games in 2Q2021, according to App Annie, with record peak daily users.</p>
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<p>The company's e-commerce business continued to see rapid growth with gross orders up by +127% YoY to 1.4bn orders and gross merchandise value up by +87.5% YoY to US$15bn whilst the adjusted EBITDA loss per order decreased by -19.6% YoY.</p>
<p>Shopee was the second most downloaded app on Google Play and the second most downloaded app across Google Play and iOS app stores combined forte shopping category globally in 2Q2021, according to App Annie.</p>
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<p>In Brazil, where Shopee was launched in late 2019, it ranked first in the shopping category by downloads, and total time spent in-app, as well as ranking second in terms of monthly active users (MAU) for 2Q2021.</p>
<p> In Brazil, it has already made good progress with more monthly active users than <a href="https://www.smartkarma.com/entities/amazon-com-inc" target="_blank" data-smartkarma-citation="entities:409:1" rel="noopener">Amazon.com Inc (AMZN US)</a> and <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> and stands in the number two position after <a href="https://www.smartkarma.com/entities/mercadolibre-inc" target="_blank" data-smartkarma-citation="entities:27954:1" rel="noopener">MercadoLibre Inc (MELI US)</a> in terms of active users.</p>
<p><a href="https://www.smartkarma.com/entities/sea-ltd" target="_blank" data-smartkarma-citation="entities:8509:1" rel="noopener">Sea Ltd (SE US)</a> also continued to make significant progress in digital financial services through the adoption of SeaMoney and ShopeePay, with US$4.1bn in total payment volume in its mobile wallet in 2Q2021, up nearly +150% YoY. It also saw an increase of +109% in quarterly paying users in 2Q2021. </p>
<p>The company continues to grow its ShopeeFood business in Indonesia and Vietnam and has seen a very strong performance and positive reception from users as well as driver communities in both markets in 2Q2021, with a strong focus on the quality of services to users.</p>
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<p>The company booked an overall gross profit increase of +364% YoY. From a non-GAAP EBITDA perspective, the company booked an EBITDA loss of (US$24.1m) versus an EBITDA profit of US$7.7m.</p>
<p>From a segmental point of view, <a href="https://www.smartkarma.com/entities/sea-ltd" target="_blank" data-smartkarma-citation="entities:8509:1" rel="noopener">Sea Ltd (SE US)</a> booked a positive EBITDA of US$740.9m for its digital entertainment segment in 2Q2021 versus US436.2m last year in the same period, an increase of +69.8% YoY. </p>
<p>The e-commerce segment booked an EBITDA loss of (US$579.8m) in 2Q2021 versus a loss of (US$313.7m) last year, an increase in loss of +84.8% YoY.</p>
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<section class="figure">These look like yet another blow away set of numbers for <a href="https://www.smartkarma.com/entities/sea-ltd" target="_blank" data-smartkarma-citation="entities:8509:1" rel="noopener">Sea Ltd (SE US)</a>, despite the company booking a marginally higher loss. It is all too easy to take a negative view on a high-growth company such as <a href="https://www.smartkarma.com/entities/sea-ltd" target="_blank" data-smartkarma-citation="entities:8509:1" rel="noopener">Sea Ltd (SE US)</a> but most negative arguments from analysts tinker with the quarterly minutiae and are somehow blind to the longer-term positive story and the company's growth model.</section>
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<section class="figure">Management has also raised its full-year guidance, which is now well above analyst expectations. The stock reacted positively to the results breaking out above US$300 to close at a new record close. We remain positive on <a href="https://www.smartkarma.com/entities/sea-ltd" target="_blank" data-smartkarma-citation="entities:8509:1" rel="noopener">Sea Ltd (SE US)</a>, which now trades on 10.5x FY22E EV/Sales and 8x FY23E EV/sales, which may look rich but is justified by superior growth to its peers, with e-commerce and digital finance fuelled by the company's gaming business. </section>
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Sea Ltd (SE US) announced yet another record set of quarterly results last night, with +159% growth in total GAAP revenues to US$2,280.6m. This marks the 12th consecutive quarter of triple-digit growth in revenues, which deserves a standing ovation
The company's digital entertainment business continued to thrive, with quarterly active users (QAU) increasing by +45% YoY and importantly quarterly paying users increasing +85% YoY in 2Q2021, and generating positive EBITDA of US$740.9m.
The quarterly paying users represented a higher portion of users in 2Q2021 and Adjusted EBITDA as a portion of bookings improved to 62.8% for 2Q2021 versus 60.9% in 2Q2020.
Garena's self-developed global hit game Free Fire reached over 1bn downloads on Google Play, with the game ranking number three globally by average monthly users for mobile games in 2Q2021, according to App Annie, with record peak daily users.

The company's e-commerce business continued to see rapid growth with gross orders up by +127% YoY to 1.4bn orders and gross merchandise value up by +87.5% YoY to US$15bn whilst the adjusted EBITDA loss per order decreased by -19.6% YoY.
Shopee was the second most downloaded app on Google Play and the second most downloaded app across Google Play and iOS app stores combined forte shopping category globally in 2Q2021, according to App Annie.

In Brazil, where Shopee was launched in late 2019, it ranked first in the shopping category by downloads, and total time spent in-app, as well as ranking second in terms of monthly active users (MAU) for 2Q2021.
 In Brazil, it has already made good progress with more monthly active users than Amazon.com Inc (AMZN US) and Alibaba Group (BABA US) and stands in the number two position after MercadoLibre Inc (MELI US) in terms of active users.
Sea Ltd (SE US) also continued to make significant progress in digital financial services through the adoption of SeaMoney and ShopeePay, with US$4.1bn in total payment volume in its mobile wallet in 2Q2021, up nearly +150% YoY. It also saw an increase of +109% in quarterly paying users in 2Q2021. 
The company continues to grow its ShopeeFood business in Indonesia and Vietnam and has seen a very strong performance and positive reception from users as well as driver communities in both markets in 2Q2021, with a strong focus on the quality of services to users.


The company booked an overall gross profit increase of +364% YoY. From a non-GAAP EBITDA perspective, the company booked an EBITDA loss of (US$24.1m) versus an EBITDA profit of US$7.7m.
From a segmental point of view, Sea Ltd (SE US) booked a positive EBITDA of US$740.9m for its digital entertainment segment in 2Q2021 versus US436.2m last year in the same period, an increase of +69.8% YoY. 
The e-commerce segment booked an EBITDA loss of (US$579.8m) in 2Q2021 versus a loss of (US$313.7m) last year, an increase in loss of +84.8% YoY.


These look like yet another blow away set of numbers for Sea Ltd (SE US), despite the company booking a marginally higher loss. It is all too easy to take a negative view on a high-growth company such as Sea Ltd (SE US) but most negative arguments from analysts tinker with the quarterly minutiae and are somehow blind to the longer-term positive story and the company's growth model.




Management has also raised its full-year guidance, which is now well above analyst expectations. The stock reacted positively to the results breaking out above US$300 to close at a new record close. We remain positive on Sea Ltd (SE US), which now trades on 10.5x FY22E EV/Sales and 8x FY23E EV/sales, which may look rich but is justified by superior growth to its peers, with e-commerce and digital finance fuelled by the company's gaming business. 














Quality-first, Business-perspective Strategy, Urbem (HK) Limited

Steven Chen

Quality-first, Business-perspective Strategy

<ul>
<li>I seldom touched those unpredicatble biotech stocks, but Bioventix is an exception;</li>
<li>The company provides a bond-like cash streams for its owners, through a well-moated, highly predictable business model;</li>
<li>Although it is not clear whether the share can offer a 20% total return at this price level, I see a high chance for it to outperform the market benchmark with a limited downside from here in the long run.</li>
</ul>


I seldom touched those unpredicatble biotech stocks, but Bioventix is an exception;
The company provides a bond-like cash streams for its owners, through a well-moated, highly predictable business model;
Although it is not clear whether the share can offer a 20% total return at this price level, I see a high chance for it to outperform the market benchmark with a limited downside from here in the long run.


Bioventix: A Rare Biotech Play with a Low-Risk, High-Return Model

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.

Event-Driven

<div>
<p>Coupang, one of the largest e-commerce players in Korea, was listed on 11th Mar 2021 when it raised around US$4.5bn via selling a mix of primary and secondary shares in its US IPO.</p>
<p>In this note, we'll talk about the upcoming lock-up expiry.</p>
<p>We've covered various aspects of the deal in our earlier insights: </p>
</div><div><ul style="list-style-type: disc;">
<li>
<a href="https://www.smartkarma.com/insights/coupang-pre-ipo-the-positives-fast-growth-sticky-customers" target="_blank" rel="noopener">Coupang Pre-IPO - The Positives - Fast Growth, Sticky Customers</a>, </li>
<li><a href="https://www.smartkarma.com/insights/coupang-pre-ipo-the-negatives-horrendous-data-disclosures-including-no-mention-of-ott-launch" target="_blank" rel="noopener">Coupang Pre-IPO - The Negatives - Horrendous Data Disclosures, Including No Mention of OTT Launch</a></li>
<li><a href="https://www.smartkarma.com/insights/coupang-pre-ipo-fair-bit-of-competition-but-it-s-doing-better-than-most-local-peers" target="_blank" rel="noopener">Coupang Pre-IPO - Fair Bit of Competition but It’s Doing Better than Most Local Peers</a></li>
<li><a href="https://www.smartkarma.com/insights/coupang-pre-ipo-earnings-forecast-and-valuation" target="_blank" rel="noopener">Coupang Pre-IPO - Earnings Forecast and Valuation</a></li>
<li><a href="https://www.smartkarma.com/insights/coupang-ipo-momentum-play-unequal-lock-up-index-inclusion" target="_blank" rel="noopener">Coupang IPO - Momentum Play, Unequal Lock-Up, Index Inclusion</a></li>
<li><a href="https://www.smartkarma.com/insights/coupang-ipo-quick-note-peers-move-down-range-moves-up-ripe-for-trading" target="_blank" rel="noopener">Coupang IPO - Quick Note - Peers Move Down, Range Moves Up. Ripe for Trading.</a></li>
<li><a href="https://www.smartkarma.com/insights/coupang-ipo-trading-most-hit-near-term-peak-on-the-first-day-key-trading-lock-up-dates" target="_blank" rel="noopener">Coupang IPO Trading - Most Hit near Term Peak on the First Day - Key Trading/​Lock-Up Dates</a></li>
</ul></div>


Coupang, one of the largest e-commerce players in Korea, was listed on 11th Mar 2021 when it raised around US$4.5bn via selling a mix of primary and secondary shares in its US IPO.
In this note, we'll talk about the upcoming lock-up expiry.
We've covered various aspects of the deal in our earlier insights: 


Coupang Pre-IPO - The Positives - Fast Growth, Sticky Customers, 
Coupang Pre-IPO - The Negatives - Horrendous Data Disclosures, Including No Mention of OTT Launch
Coupang Pre-IPO - Fair Bit of Competition but It’s Doing Better than Most Local Peers
Coupang Pre-IPO - Earnings Forecast and Valuation
Coupang IPO - Momentum Play, Unequal Lock-Up, Index Inclusion
Coupang IPO - Quick Note - Peers Move Down, Range Moves Up. Ripe for Trading.
Coupang IPO Trading - Most Hit near Term Peak on the First Day - Key Trading/​Lock-Up Dates


Coupang Lock-Up Expiry - Failed to Meet Multiple Lock-Up Exits; Now Hitting the US$7bn Expiry

Independent research on the U.S. markets, Baptista Research

Baptista Research

Independent research on the U.S. markets

Baptista Research is an independent financial research house focused on the U.S. markets. We provide equity research as well as credit research reports on the top-listed U.S. companies with most of our focus on technology, consumer goods and services, automobiles, industrials, oil and gas, pharma, and healthcare. Our research has served more than 3000 institutional investors including mutual funds, hedge funds, banks, family offices, and various buy-side firms. We operate a research subscription service where institutions, as well as retail investors, can have priority access to all our research. We also have a wide distribution of our research reports across some of the top global financial platforms. Apart from equity research and credit research, we also provide advisory services with respect to mergers & acquisitions (M&A), private equity/ venture capital fundraising, valuation reports, and investment management services for corporates.
Baptista Research is owned and managed by Ishan Majumdar, an ex-Venture Capitalist/ Investment Banker, a Chartered Accountant, and a Masters’ degree holder in Management from HEC Paris. Ishan has nearly a decade of experience in Mergers and Acquisitions, Leveraged Buyouts (LBOs), Venture Capital Investing, Corporate Strategy, and Valuation in front-office roles at the likes of BNP Paribas CIB, Credit Agricole CIB, Groupe Danone, and TIW Private Equity. He has worked on and closed multiple acquisition deals, leveraged buyouts, and start-up investment transactions.

Equity Capital Markets

<ul>
<li>Amazon reported a mixed quarter with a solid earnings beat but a revenue miss on account of slowing e-commerce revenues.</li>
<li>Its margins are close to 30% and are the reason for the massive earnings beat.</li>
<li>An increasing number of merchants are resorting to using Amazon ads to push their products which has led to these revenues.</li>
</ul>


Amazon reported a mixed quarter with a solid earnings beat but a revenue miss on account of slowing e-commerce revenues.
Its margins are close to 30% and are the reason for the massive earnings beat.
An increasing number of merchants are resorting to using Amazon ads to push their products which has led to these revenues.


Global Emerging Market Equities, Propitious Research

Wium Malan, CFA

Global Emerging Market Equities

Independent, Fundamental Quantitative Research

Propitious Research

Fully independent, fundamental and quantitative equity research, focused on companies in the Telecommunication, Media, Technology, Internet and Healthcare sectors in the Global Emerging Markets. Idea generation focused on Quality stocks, trading below their intrinsic Value, with sound Corporate Governance.

Thematic (Sector/Industry)

<p>This insight provides a summary of the key news developments impacting the largest countries and constituents of the Global Emerging Markets equity indices. </p><p><strong><em>Companies mentioned this week:</em></strong></p><p><a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent (700 HK)</a>, <a href="https://www.smartkarma.com/entities/flipkart-online-services-private-limited" target="_blank" data-smartkarma-citation="entities:31076:1" rel="noopener">Flipkart Online Services (1398508D IN)</a>, <a href="https://www.smartkarma.com/entities/meituan-dianping" target="_blank" data-smartkarma-citation="entities:26970:1" rel="noopener">Meituan (3690 HK)</a></p>

This insight provides a summary of the key news developments impacting the largest countries and constituents of the Global Emerging Markets equity indices. Companies mentioned this week:Tencent (700 HK), Flipkart Online Services (1398508D IN), Meituan (3690 HK)

Global Emerging Markets Weekly: 6 August 2021

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)

Sea Ltd (SE US) - Standing Ovation

Sea Ltd released another record quarterly result affirming its leading position in gaming and e-commerce in SE Asia, with some positive signals...

Angus Mackintosh

Bioventix: A Rare Biotech Play with a Low-Risk, High-Return Model

Although it is not clear whether this bond proxy can offer a 20% total return at this level, I see a high chance for it to outperform the benchmark...

Steven Chen

Coupang Lock-Up Expiry - Failed to Meet Multiple Lock-Up Exits; Now Hitting the US$7bn Expiry

Coupang was listed on 11th Mar 2021 when it raised around US$4.5bn via selling a mix of primary and secondary shares in its US IPO. In this note,...

Sumeet Singh

Amazon.com Inc. - Investment Thesis

Amazon reported a mixed quarter with a solid earnings beat but a revenue miss on account of slowing e-commerce revenues. Its margins are close to...

Baptista Research

Global Emerging Markets Weekly: 6 August 2021

This insight provides a summary of the key news developments impacting the largest countries and constituents of the Global Emerging Markets equity...

Wium Malan, CFA

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