IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Equity Capital Markets

Shimao Services Holdings Limited / Equity Capital Markets

<div><p><a href="https://www.smartkarma.com/entities/shimao-services-holdings-limited" target="_blank" data-smartkarma-citation="entities:29199:1" rel="noopener">Shimao Services Holdings (873 HK)</a> is a Chinese property management company which is a subsidiary of <a href="https://www.smartkarma.com/entities/shimao-property-holdings-limited" target="_blank" data-smartkarma-citation="entities:8375:1" rel="noopener">Shimao Property Holdings (813 HK)</a> and backed by Sequoia China and <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent Holdings (700 HK)</a>. At the proposed IPO price range of HK$14.80-17.20 per share, Shimao will have a market cap of HK$34,823.5-40,470.6 million ($4.5-5.2 billion). At the mid-point of the IPO price range, Shimao will raise net proceeds of HK$5,449.9 million ($703 million). Unlike most of the property management IPOs, Shimao's IPO has no cornerstone support. </p></div><div><div><div class="content-highlight"><p>In <a href="https://www.smartkarma.com/insights/shimao-services-ipo-initiation-at-your-service" target="_blank" rel="noopener">our initiation note</a>, we highlighted that Shimao’s fundamentals over the track record period are attractive. Our valuation analysis suggests that the valuation implied by the IPO price range is reasonable for the growth. </p></div></div></div>

Shimao Services Holdings (873 HK) is a Chinese property management company which is a subsidiary of Shimao Property Holdings (813 HK) and backed by Sequoia China and Tencent Holdings (700 HK). At the proposed IPO price range of HK$14.80-17.20 per share, Shimao will have a market cap of HK$34,823.5-40,470.6 million ($4.5-5.2 billion). At the mid-point of the IPO price range, Shimao will raise net proceeds of HK$5,449.9 million ($703 million). Unlike most of the property management IPOs, Shimao's IPO has no cornerstone support. In our initiation note, we highlighted that Shimao’s fundamentals over the track record period are attractive. Our valuation analysis suggests that the valuation implied by the IPO price range is reasonable for the growth. 

KWG Living Group / Equity Capital Markets

<div><p><a href="https://www.smartkarma.com/entities/kwg-living-group" target="_blank" data-smartkarma-citation="entities:29231:1" rel="noopener">KWG Living Group (3913 HK)</a> is a property management service provider in China. KWG accounted for 0.09% of the total GFA under management in the China property management market in 2019, according to JLL. At the proposed IPO price range of HK$7.00-8.13 per share, KWG will have a market cap of HK$14,124.7-16,404.8 million ($1.8-2.1 billion). At the mid-point of the IPO price range, KWG will raise net proceeds of HK$2,755.5 million ($356 million). </p></div><div><p>Eight cornerstone investors will subscribe for 32.09% of the offer shares at the mid-point of the IPO price range. The cornerstone investors are Hillhouse Capital, Orchid China, Harvest Fund Management, Snow Lake Capital, Valliance Asset Management, <a href="https://www.smartkarma.com/entities/china-lesso-group-holdings-ltd" target="_blank" data-smartkarma-citation="entities:11598:1" rel="noopener">China Lesso Group Holdings (2128 HK)</a>, OP Capital and Aspex Management. </p></div><div class="content-highlight"><p>In <a href="https://www.smartkarma.com/insights/kwg-living-group-ipo-initiation-urban-living" target="_blank" rel="noopener">our initiation note</a>, we highlighted that KWG’s fundamentals over the track record period are attractive. Overall, we think that the valuation implied by the IPO price range is reasonable for KWG's growth potential. </p></div>

KWG Living Group (3913 HK) is a property management service provider in China. KWG accounted for 0.09% of the total GFA under management in the China property management market in 2019, according to JLL. At the proposed IPO price range of HK$7.00-8.13 per share, KWG will have a market cap of HK$14,124.7-16,404.8 million ($1.8-2.1 billion). At the mid-point of the IPO price range, KWG will raise net proceeds of HK$2,755.5 million ($356 million). Eight cornerstone investors will subscribe for 32.09% of the offer shares at the mid-point of the IPO price range. The cornerstone investors are Hillhouse Capital, Orchid China, Harvest Fund Management, Snow Lake Capital, Valliance Asset Management, China Lesso Group Holdings (2128 HK), OP Capital and Aspex Management. In our initiation note, we highlighted that KWG’s fundamentals over the track record period are attractive. Overall, we think that the valuation implied by the IPO price range is reasonable for KWG's growth potential. 

<p><a href="https://www.smartkarma.com/entities/kwg-living-group" target="_blank" data-smartkarma-citation="entities:29231:1" rel="noopener">KWG Living Group (3913 HK)</a> is a property management service provider in China. KWG accounted for 0.09% of the total GFA under management in the China property management market in 2019, according to JLL. <a href="https://www.smartkarma.com/entities/kwg-group-holdings-ltd" target="_blank" data-smartkarma-citation="entities:12601:1" rel="noopener">Kwg Property Holding (1813 HK)</a>, the parent, has launched the spin-off and Hong Kong IPO of KWG to raise up to $400 million. </p><div class="content-highlight"><p>KWG offers not only property management service for both residential and commercial properties, but also commercial operational service. The commercial property management and operational service are still at the early development stage with fewer participants, compared with residential property management, which presents more headroom for KWG to expand. Also, KWG has a strong presence in the Greater Bay Area and ranked tenth among the leading property management companies in the Greater Bay Area, according to the CIA. Overall, KWG’s fundamentals over the track record period are attractive, in our view.</p></div>

KWG Living Group (3913 HK) is a property management service provider in China. KWG accounted for 0.09% of the total GFA under management in the China property management market in 2019, according to JLL. Kwg Property Holding (1813 HK), the parent, has launched the spin-off and Hong Kong IPO of KWG to raise up to $400 million. KWG offers not only property management service for both residential and commercial properties, but also commercial operational service. The commercial property management and operational service are still at the early development stage with fewer participants, compared with residential property management, which presents more headroom for KWG to expand. Also, KWG has a strong presence in the Greater Bay Area and ranked tenth among the leading property management companies in the Greater Bay Area, according to the CIA. Overall, KWG’s fundamentals over the track record period are attractive, in our view.

KWG Living Group IPO Initiation: Urban Living

<p><a href="https://www.smartkarma.com/entities/shimao-services-holdings-limited" target="_blank" data-smartkarma-citation="entities:29199:1" rel="noopener">Shimao Services Holdings (SSH HK)</a> is a Chinese property management company which is a subsidiary of <a href="https://www.smartkarma.com/entities/shimao-property-holdings-limited" target="_blank" data-smartkarma-citation="entities:8375:1" rel="noopener">Shimao Property Holdings (813 HK)</a> and backed by Sequoia China and <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent Holdings (700 HK)</a>. Shimao ranked third among the Top 20 Property Management Companies in China as measured by the revenue growth rate in 2019, according to China Index Academy. Shimao Group, the parent, will shortly launch the spin-off and Hong Kong IPO of Shimao to raise up to $1 billion, according to press reports. </p><div class="content-highlight"><p>Property management IPOs are popular due to the strong post-IPO share price performance of recent listings. The property management sector has a long-term recurring business model and is capital-light. Overall, Shimao’s fundamentals over the track record period are attractive, in our view.</p></div>

Shimao Services Holdings (SSH HK) is a Chinese property management company which is a subsidiary of Shimao Property Holdings (813 HK) and backed by Sequoia China and Tencent Holdings (700 HK). Shimao ranked third among the Top 20 Property Management Companies in China as measured by the revenue growth rate in 2019, according to China Index Academy. Shimao Group, the parent, will shortly launch the spin-off and Hong Kong IPO of Shimao to raise up to $1 billion, according to press reports. Property management IPOs are popular due to the strong post-IPO share price performance of recent listings. The property management sector has a long-term recurring business model and is capital-light. Overall, Shimao’s fundamentals over the track record period are attractive, in our view.

Shimao Services IPO Initiation: At Your Service

Excellence Commercial Property & Facilities Management / Equity Capital Markets

Excellence Commercial Property & Facilities Management

<p><a href="https://www.smartkarma.com/entities/excellence-commercial-property-facilities-management" target="_blank" data-smartkarma-citation="entities:29249:1" rel="noopener">Excellence Commercial Property (1611267D CH)</a> is a leading commercial operational service provider in China and ranked fourth among the commercial property management service providers in China, according to Frost &amp; Sullivan. It has launched a Hong Kong IPO to raise up to HK$3.2 billion ($410 million), according to press reports. </p><div class="content-highlight"><p>Property management IPOs are popular as the property management sector is asset-light and has a long-term recurring business model. Overall, Excellence’s fundamentals over the track record period are attractive, in our view.</p></div>

Excellence Commercial Property (1611267D CH) is a leading commercial operational service provider in China and ranked fourth among the commercial property management service providers in China, according to Frost &amp; Sullivan. It has launched a Hong Kong IPO to raise up to HK$3.2 billion ($410 million), according to press reports. Property management IPOs are popular as the property management sector is asset-light and has a long-term recurring business model. Overall, Excellence’s fundamentals over the track record period are attractive, in our view.

Excellence Commercial Property & Facilities Mgmt IPO Initiation: Facilities Facilitate

China

Central China New Life Limited engages in provision of property management services and related value-added services. The Company offers property management and related value-added services, lifestyle services, commercial property management and consultation services, and more. Central China New Life mainly conducts its businesses in China market.

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Central China New Life (9983 HK)

Shimao Services IPO: Valuation Insights

At the proposed IPO price range of HK$14.80-17.20 per share, Shimao will have a market cap of $4.5-5.2 billion. Our valuation analysis suggests...

Arun George

KWG Living Group IPO: Valuation Insights

At the mid-point of the IPO price range, KWG will raise net proceeds of $356 million. Overall, we think that the valuation implied by the IPO price...

Arun George

KWG Living Group IPO Initiation: Urban Living

KWG offers not only property mgmt service for residential and commercial properties, but also commercial operational service. Overall, KWG’s...

Arun George

Shimao Services IPO Initiation: At Your Service

Property management IPOs are popular due to the strong post-IPO share price performance of recent listings. Overall, Shimao’s fundamentals over the...

Arun George

Excellence Commercial Property & Facilities Mgmt IPO Initiation: Facilities Facilitate

Excellence is a leading commercial operational service provider in China and ranked fourth among the commercial property management service...

Arun George

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