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

<ul>
<li>With <a href="https://www.smartkarma.com/entities/toyota-motor-corp" target="_blank" data-smartkarma-citation="entities:73:1" rel="noopener">Toyota (7203 JP)</a> having sold some of its stake in <a href="https://www.smartkarma.com/entities/denso-corp" target="_blank" data-smartkarma-citation="entities:18703:1" rel="noopener">Denso</a>, <a href="https://www.smartkarma.com/entities/kddi-corp" target="_blank" data-smartkarma-citation="entities:639:1" rel="noopener">KDDI</a> and <a href="https://www.smartkarma.com/entities/harmonic-drive-systems-inc" target="_blank" data-smartkarma-citation="entities:10238:1" rel="noopener">Harmonic Drive</a> this year, it has firmly set the ball rolling for unwinding some of its cross-shareholding.</li>
<li>Toyota has a shareholding in around 60 listed companies, with its combined disposable stake worth over US$26bn.</li>
<li>In this note, we take a look at its stakes in various companies to see which ones could possibly be candidates for further selldowns.</li>
</ul>


With Toyota (7203 JP) having sold some of its stake in Denso, KDDI and Harmonic Drive this year, it has firmly set the ball rolling for unwinding some of its cross-shareholding.
Toyota has a shareholding in around 60 listed companies, with its combined disposable stake worth over US$26bn.
In this note, we take a look at its stakes in various companies to see which ones could possibly be candidates for further selldowns.


Toyota Cross-Shareholding - To Say a Whole Lot Is Left Would Be a US$26bn Understatement

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>
<a href="https://www.smartkarma.com/entities/jardine-cycle-carriage-ltd" target="_blank" data-smartkarma-citation="entities:347:1" rel="noopener">Jardine Cycle &amp; Carriage (JCNC SP)</a>'s current implied stub value is around its highest-ever level.</li>
<li>The simple ratio of JCNC/<a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a> is around its highest level outside the 2008 GFC.</li>
<li>A weak Indonesian rupiah is likely a factor. Still, JCNC is trading rich to its NAV. A takeover from parent <a href="https://www.smartkarma.com/entities/jardine-matheson-holdings-ltd" target="_blank" data-smartkarma-citation="entities:19718:1" rel="noopener">Jardine Matheson Holdings (JM SP)</a> is idealistic.</li>
</ul>



Jardine Cycle &amp; Carriage (JCNC SP)'s current implied stub value is around its highest-ever level.
The simple ratio of JCNC/Astra International (ASII IJ) is around its highest level outside the 2008 GFC.
A weak Indonesian rupiah is likely a factor. Still, JCNC is trading rich to its NAV. A takeover from parent Jardine Matheson Holdings (JM SP) is idealistic.


<ul>
<li>
<a href="https://www.smartkarma.com/entities/jardine-cycle-carriage-ltd" target="_blank" data-smartkarma-citation="entities:347:1" rel="noopener">Jardine Cycle &amp; Carriage (JCNC SP)</a> is currently trading at a ~12% discount to NAV, just outside its narrowest post-Covid.</li>
<li>A key catalyst for the recent narrowing was JCNC's inclusion in the SIMSCI Index at the end of last month.</li>
<li>JCNC is expensive here - relative to historical values -  and from an implied stub perspective.</li>
</ul>



Jardine Cycle &amp; Carriage (JCNC SP) is currently trading at a ~12% discount to NAV, just outside its narrowest post-Covid.
A key catalyst for the recent narrowing was JCNC's inclusion in the SIMSCI Index at the end of last month.
JCNC is expensive here - relative to historical values -  and from an implied stub perspective.


<ul>
<li>
<a href="https://www.smartkarma.com/entities/jardine-matheson-holdings-ltd" target="_blank" data-smartkarma-citation="entities:19718:1" rel="noopener">Jardine Matheson Holdings (JM SP)</a> (JMH) has shed ~8% since MSCI said it was cutting the conglomerate's weighing in two indices.</li>
<li>The reweighting follows the cancellation of the 59% shareholding in JMH held by <a href="https://www.smartkarma.com/entities/jardine-strategic-holdings-ltd" target="_blank" data-smartkarma-citation="entities:15081:1" rel="noopener">Jardine Strategic Holdings (JS SP)</a>, which was privatised last year.</li>
<li>I see the discount to NAV at ~40%, right at the 12-month -2 STD level. JMH bought back ~149mn shares in the 1Q22, paying ~US$59/share, 17% above the current price.</li>
</ul>



Jardine Matheson Holdings (JM SP) (JMH) has shed ~8% since MSCI said it was cutting the conglomerate's weighing in two indices.
The reweighting follows the cancellation of the 59% shareholding in JMH held by Jardine Strategic Holdings (JS SP), which was privatised last year.
I see the discount to NAV at ~40%, right at the 12-month -2 STD level. JMH bought back ~149mn shares in the 1Q22, paying ~US$59/share, 17% above the current price.


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

<ul>
<li>
<a href="https://www.smartkarma.com/entities/astra-otoparts-tbk-pt" target="_blank" data-smartkarma-citation="entities:16766:1" rel="noopener">Astra Otoparts (AUTO IJ)</a> looks set to see increasing contributions from its modern retail push, which will boost its trading business and should see margins improving over time.</li>
<li>AUTO is pushing into both the EV component space and manufacturing public and residential EV charging equipment. It is also venturing into medical devices as local content becomes a requirement.</li>
<li>AUTO has outperformed the auto market since the pandemic and looks set to continue to do so through new growth segments. Valuations attractive on 5.5x forward PER and 8% yield.</li>
</ul>



Astra Otoparts (AUTO IJ) looks set to see increasing contributions from its modern retail push, which will boost its trading business and should see margins improving over time.
AUTO is pushing into both the EV component space and manufacturing public and residential EV charging equipment. It is also venturing into medical devices as local content becomes a requirement.
AUTO has outperformed the auto market since the pandemic and looks set to continue to do so through new growth segments. Valuations attractive on 5.5x forward PER and 8% yield.


Astra Otoparts (AUTO IJ) - EVs, Modern Retail, and Medical Equipment

Indonesia

PT Astra International Tbk assembles and distributes automobiles, motorcycles, and their related spare parts.  Through its subsidiaries, the Company also operates in the mining, development of plantations, financial and information technology.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Astra International (ASII IJ)

Toyota Cross-Shareholding - To Say a Whole Lot Is Left Would Be a US$26bn Understatement

Toyota, Toyota Industries and Denso are tag teaming to unwind some of their stake in Aisin, in a deal worth over US$1bn. While the timing of the...

Sumeet Singh

Jardine Cycle & Carriage Is A Short

Jardine Cycle & Carriage's premium to NAV is not justifiable. I'd look to reverse the stub here - Short JCNC, Long Astra.

David Blennerhassett

JCNC Is Still Overstretched Vs. Astra

JCNC is expensive here - relative to historical values - and from an implied stub perspective. And the MSCI inclusion event has now passed. I'd...

David Blennerhassett

Jardine Matheson (JM SP): MSCI Blues

Given JMH's strong underlying operating performance, the 40% discount to NAV - one in which there are discounts of discounts, JMH is attractive...

David Blennerhassett

Astra Otoparts (AUTO IJ) - EVs, Modern Retail, and Medical Equipment

Astra Otoparts (AUTO IJ) poised for growth with modern retail push, expansion into EV components and medical devices. Valuations attractive on...

Angus Mackintosh

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Toyota Cross-Shareholding - To Say a Whole Lot Is Left Would Be a US$26bn Understatement

Toyota, Toyota Industries and Denso are tag teaming to unwind some of their stake in Aisin, in a deal worth over US$1bn. While the timing of the...

Sumeet Singh

Jardine Cycle & Carriage Is A Short

Jardine Cycle & Carriage's premium to NAV is not justifiable. I'd look to reverse the stub here - Short JCNC, Long Astra.

David Blennerhassett

JCNC Is Still Overstretched Vs. Astra

JCNC is expensive here - relative to historical values - and from an implied stub perspective. And the MSCI inclusion event has now passed. I'd...

David Blennerhassett

Jardine Matheson (JM SP): MSCI Blues

Given JMH's strong underlying operating performance, the 40% discount to NAV - one in which there are discounts of discounts, JMH is attractive...

David Blennerhassett

Astra Otoparts (AUTO IJ) - EVs, Modern Retail, and Medical Equipment

​Astra Otoparts (AUTO IJ) poised for growth with modern retail push, expansion into EV components and medical devices. Valuations attractive on...

Angus Mackintosh

Astra Otoparts (AUTO IJ) poised for growth with modern retail push, expansion into EV components and medical devices. Valuations attractive on...