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 Bottom-Up

Dayamitra Telekomunikasi PT / Equity Bottom-Up

<div><div id="ember4189"><div>
<div>
<a href="https://www.smartkarma.com/entities/pt-dayamitra-telekomunikasi" target="_blank" data-smartkarma-citation="entities:34741:1" rel="noopener">Mitratel (1319Z IJ)</a> is the largest telco tower owner and operator in Indonesia based on the number of telecommunication towers owned as of 30 June 2021, according to Analysys Mason. Mitratel is a subsidiary of <a href="https://www.smartkarma.com/entities/telekomunikasi-indonesia" target="_blank" data-smartkarma-citation="entities:1051:1" rel="noopener">Telekomunikasi Indonesia (TLKM IJ)</a>.</div>
<div></div>
<div>Mitratel has launched an IPO to raise IDR20.0-24.9 trillion ($1.4-1.8 billion) at the IPO price range of IDR775-975 per share. Bookbuilding will close on 4 November and the shares are set to list on 22 November. </div>
<div></div>
</div></div></div><div>
<p>In <a href="https://www.smartkarma.com/insights/mitratel-dayamitra-telekomunikasi-ipo-initiation-control-tower" target="_blank" data-smartkarma-citation="insights:59620" rel="noopener">Mitratel (Dayamitra Telekomunikasi) IPO Initiation: Control Tower</a>, we noted that in comparison to other major regions (US, Western Europe, China and India), the tower industry in Indonesia offers an attractive mix of high EBITDA margin, low capex, no colocation discount and no obligation to provide power in the contract. The tower industry also benefits from predictable revenue due to long-term contracts and high renewal rates. Mitratel's contracted revenue based on agreements with customers for all types of leases is IDR30.7 trillion, and the average remaining life of lease agreements is 6.3 years, as of 30 June 2021. We concluded that Mitratel's fundamentals tick all the right boxes. </p>
<div class="content-highlight"><p>Our valuation analysis suggests that the IPO price range is attractive. Overall, we would participate in the IPO.</p></div>
</div>



Mitratel (1319Z IJ) is the largest telco tower owner and operator in Indonesia based on the number of telecommunication towers owned as of 30 June 2021, according to Analysys Mason. Mitratel is a subsidiary of Telekomunikasi Indonesia (TLKM IJ).

Mitratel has launched an IPO to raise IDR20.0-24.9 trillion ($1.4-1.8 billion) at the IPO price range of IDR775-975 per share. Bookbuilding will close on 4 November and the shares are set to list on 22 November. 


In Mitratel (Dayamitra Telekomunikasi) IPO Initiation: Control Tower, we noted that in comparison to other major regions (US, Western Europe, China and India), the tower industry in Indonesia offers an attractive mix of high EBITDA margin, low capex, no colocation discount and no obligation to provide power in the contract. The tower industry also benefits from predictable revenue due to long-term contracts and high renewal rates. Mitratel's contracted revenue based on agreements with customers for all types of leases is IDR30.7 trillion, and the average remaining life of lease agreements is 6.3 years, as of 30 June 2021. We concluded that Mitratel's fundamentals tick all the right boxes. 
Our valuation analysis suggests that the IPO price range is attractive. Overall, we would participate in the IPO.


Mitratel (Dayamitra Telekomunikasi) IPO: Valuation Insights

Equity Capital Markets

Dayamitra Telekomunikasi PT / Equity Capital Markets

<p><a href="https://www.smartkarma.com/entities/pt-dayamitra-telekomunikasi" target="_blank" data-smartkarma-citation="entities:34741:1" rel="noopener">Mitratel (1319Z IJ)</a> is the largest telco tower owner and operator in Indonesia based on the number of telecommunication towers owned as of 30 June 2021, according to Analysys Mason. Mitratel is a subsidiary of <a href="https://www.smartkarma.com/entities/telekomunikasi-indonesia" target="_blank" data-smartkarma-citation="entities:1051:1" rel="noopener">Telekomunikasi Indonesia (TLKM IJ)</a>.</p><p>Mitratel has launched an IPO to raise IDR20.0-24.9 trillion ($1.4-1.8 billion) at the IPO price range of IDR775-975 per share. Bookbuilding will close on 4 November and the shares are set to list on 22 November. </p><p>Indonesia's tower industry is fast consolidating into an oligopoly with three large tower companies which are Mitratel, <a href="https://www.smartkarma.com/entities/sarana-menara-nusantara-pt" target="_blank" data-smartkarma-citation="entities:6848:1" rel="noopener">Sarana Menara Nusantara (TOWR IJ)</a> (Protelindo) and <a href="https://www.smartkarma.com/entities/tower-bersama-infrastructure" target="_blank" data-smartkarma-citation="entities:3537:1" rel="noopener">Tower Bersama Infrastructure (TBIG IJ)</a>. In comparison to other major regions (US, Western Europe, China and India), the tower industry in Indonesia offers an attractive mix of high EBITDA margin, low capex, no colocation discount and no obligation to provide power in the contract.</p><div class="content-highlight"><p>The tower industry also benefits from predictable revenue due to long-term contracts and high renewal rates. Mitratel's contracted revenue based on agreements with customers for all types of leases is IDR30.7 trillion, and the average remaining life of lease agreements is 6.3 years, as of 30 June 2021. Overall, Mitratel's fundamentals tick all the right boxes, in our view. </p></div>

Mitratel (1319Z IJ) is the largest telco tower owner and operator in Indonesia based on the number of telecommunication towers owned as of 30 June 2021, according to Analysys Mason. Mitratel is a subsidiary of Telekomunikasi Indonesia (TLKM IJ).Mitratel has launched an IPO to raise IDR20.0-24.9 trillion ($1.4-1.8 billion) at the IPO price range of IDR775-975 per share. Bookbuilding will close on 4 November and the shares are set to list on 22 November. Indonesia's tower industry is fast consolidating into an oligopoly with three large tower companies which are Mitratel, Sarana Menara Nusantara (TOWR IJ) (Protelindo) and Tower Bersama Infrastructure (TBIG IJ). In comparison to other major regions (US, Western Europe, China and India), the tower industry in Indonesia offers an attractive mix of high EBITDA margin, low capex, no colocation discount and no obligation to provide power in the contract.The tower industry also benefits from predictable revenue due to long-term contracts and high renewal rates. Mitratel's contracted revenue based on agreements with customers for all types of leases is IDR30.7 trillion, and the average remaining life of lease agreements is 6.3 years, as of 30 June 2021. Overall, Mitratel's fundamentals tick all the right boxes, in our view. 

Mitratel (Dayamitra Telekomunikasi) IPO Initiation: Control Tower

Global Special Situations & Strategy, SR Services Ltd

David Lepper

Global Special Situations & Strategy

SR Services Ltd

SR Services provides Strategic Knowledge and Solutions services for Family Offices and Corporate Business. 

We deliver this via advisory services, strategic planning, opportunity analysis/sourcing, as well as solution implementation. 

Whilst, we create intellectual discipline and operational leverage for your projects or daily activities, our ultimate objective is to empower whilst enhancing your decision making. 

Strategic Knowledge and Solutions

Cross Asset Strategy

<h2><strong>Eight new names, SoftBank remains for the 3rd quarter running</strong></h2>
<ul>
<li>
<strong>Our</strong><strong>Q2-2021 All Cap High-Risk screen of stocks produced a market cap-weighted average price decline of 2%</strong>. In comparison, the MSCI Asia Pacific Index posted a decline of 1.7% over the same period. The stock quality of our Q2 2021 decreased 2.4 points or 3.8% over the period. Within the mix of 34 stocks in our Q2 2021 (May) list 19 posted negative performance, with an average decline of 14.1%.</li>
<li>
<strong>At a static number of 34</strong><strong> stocks our Q3 2021 screen, delivers an interesting composition this quarter, </strong>with eight (8) new names and strong representation from Hong Kong in terms of geography and Industrials and Basic Materials from a sector perspective. This suggests that the “reopening of the economy” trade may have run its course for now.</li>
<li><strong>Our Q3 2021 screen shows a further reduction in average stock rank (a reading on relative quality amongst the broad market peers with 100 being the highest) to 61 from 65.18 in Q2 2021.</strong></li>
<li>
<strong>Stock specific focus:</strong> We discuss why SoftBank stands out as a stock that presents with additional risk. We also discuss the fact that whilst there is a high representation of Industrials in the list, within this list, there are several names that may warrant not being too bearish towards.</li>
</ul>

Eight new names, SoftBank remains for the 3rd quarter running


OurQ2-2021 All Cap High-Risk screen of stocks produced a market cap-weighted average price decline of 2%. In comparison, the MSCI Asia Pacific Index posted a decline of 1.7% over the same period. The stock quality of our Q2 2021 decreased 2.4 points or 3.8% over the period. Within the mix of 34 stocks in our Q2 2021 (May) list 19 posted negative performance, with an average decline of 14.1%.

At a static number of 34 stocks our Q3 2021 screen, delivers an interesting composition this quarter, with eight (8) new names and strong representation from Hong Kong in terms of geography and Industrials and Basic Materials from a sector perspective. This suggests that the “reopening of the economy” trade may have run its course for now.
Our Q3 2021 screen shows a further reduction in average stock rank (a reading on relative quality amongst the broad market peers with 100 being the highest) to 61 from 65.18 in Q2 2021.

Stock specific focus: We discuss why SoftBank stands out as a stock that presents with additional risk. We also discuss the fact that whilst there is a high representation of Industrials in the list, within this list, there are several names that may warrant not being too bearish towards.


Screening the Silk Road: Q3 2021 High-Risk Names to Avoid

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<p><a href="https://www.smartkarma.com/entities/china-telecom-corp-ltd-h" target="_blank" data-smartkarma-citation="entities:1015:1" rel="noopener">China Telecom Corp Ltd (H) (728 HK)</a> has <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0806/2021080600069.pdf" target="_blank" rel="noopener">priced</a> its US$7.3bn offering of A-shares at RMB 4.53/share. That is not far from what I suggested might be an appropriate pricing in <a href="https://www.smartkarma.com/insights/china-mobile-941-hk-it-could-have-been-done-better-but-it-ain-t-bad-for-hs" target="_blank" data-smartkarma-citation="insights:52018" rel="noopener">China Mobile (941 HK) - It Could Have Been Done Better, But It Ain't Bad for Hs</a> and <a href="https://www.smartkarma.com/insights/china-telecom-728-hk-ups-div-payout-policy-there-s-a-plan-here-expect-china-mobile-to-follow" target="_blank" data-smartkarma-citation="insights:53355" rel="noopener">China Telecom (728 HK) Ups Div Payout Policy - There's a Plan Here. Expect China Mobile to Follow</a>.</p><p>It was also an 87% premium to the current H-share price. </p><p>As discussed in those previous insights, there are obligations on the China Telecom parent, and a promise of a <em>higher payout ratio</em> NOW and <em>even higher payout ratio</em> LATER. </p><p>Normally, I would suggest taking profits on an H-share which had rallied in the run-up to an A-share offering. But...</p><p>.... There is more below the fold.</p>

China Telecom Corp Ltd (H) (728 HK) has priced its US$7.3bn offering of A-shares at RMB 4.53/share. That is not far from what I suggested might be an appropriate pricing in China Mobile (941 HK) - It Could Have Been Done Better, But It Ain't Bad for Hs and China Telecom (728 HK) Ups Div Payout Policy - There's a Plan Here. Expect China Mobile to Follow.It was also an 87% premium to the current H-share price. As discussed in those previous insights, there are obligations on the China Telecom parent, and a promise of a higher payout ratio NOW and even higher payout ratio LATER. Normally, I would suggest taking profits on an H-share which had rallied in the run-up to an A-share offering. But....... There is more below the fold.

China Telecom A-Share IPO Prices; H-Share Discount Wide; Buy China Mobile

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

<p>On 3 June, President Biden amended Executive Order 13959 with respect to the threat posed by the military-industrial complex of the People’s Republic of China, and expanded the list of companies to include entities that operate in the defense and related materiel sector or the surveillance technology sector in China, or own, or are owned, or are controlled by persons that operate in the above sectors.</p><p>There were a few entities that appeared in Trump's list that were dropped while there were new entities that were added to the current list.</p><p>Some major changes were that the name of the list was changed from Communist Chinese Military Companies (CCMC) to Chinese Military-Industrial Complex Companies (CMIC), the list would be maintained by the Treasury Department as opposed to the Defense Department, and restrictions on subsidiaries would apply only if the subsidiary was explicitly named in the list.</p><p>It has been reported in the media, quoting senior officials, that the list will be updated on a rolling basis. As we were typing out the Insight, Reuters published an article that says <a href="https://www.reuters.com/article/usa-biden-china-investment/analysis-more-chinese-companies-could-fall-under-bidens-broader-investment-ban-idUSL2N2NM13H" target="_blank" rel="noopener">more Chinese companies could be added to the investment ban</a>.</p><p>In this Insight, we try to identify some of the subsidiaries of companies that could be added to the CMIC list where the parent entity is already included on the list.</p>

On 3 June, President Biden amended Executive Order 13959 with respect to the threat posed by the military-industrial complex of the People’s Republic of China, and expanded the list of companies to include entities that operate in the defense and related materiel sector or the surveillance technology sector in China, or own, or are owned, or are controlled by persons that operate in the above sectors.There were a few entities that appeared in Trump's list that were dropped while there were new entities that were added to the current list.Some major changes were that the name of the list was changed from Communist Chinese Military Companies (CCMC) to Chinese Military-Industrial Complex Companies (CMIC), the list would be maintained by the Treasury Department as opposed to the Defense Department, and restrictions on subsidiaries would apply only if the subsidiary was explicitly named in the list.It has been reported in the media, quoting senior officials, that the list will be updated on a rolling basis. As we were typing out the Insight, Reuters published an article that says more Chinese companies could be added to the investment ban.In this Insight, we try to identify some of the subsidiaries of companies that could be added to the CMIC list where the parent entity is already included on the list.

POTUS Executive Order: Potential Additions to the CMIC List

China

China Communications Services Corporation Limited provides specialized telecommunications support services to telecommunications operators.  The Company offers telecommunications infrastructure services, including design, construction and project supervision and management, business process outsourcing services , and applications, content and other services.

China Communications Services Corp Ltd. (552 HK)

263 Network Communications Co Ltd provides internet services and modern communication technology.  The Company's products include anti spam e-mail service, telephone conference system, and business messenger software.

Hangzhou Huaxing Chuangye Communication Technology Co., Ltd researches, produces and sells test optimization system.  The Company also provides census, assessments and, optimization services of mobile communication network.

Dr. Peng Telecom & Media Group Co., Ltd. provides value-added telecommunications services. The company offers Internet access, e-government, Internet data center, and private network and operations services, as well as network security monitoring, city surveillance, toll-shunt, and other value-added network services.

China United Network Communications Limited provides a variety of telecommunication services, including GSM and CDMA wireless telecommunication services, international and domestic long distance communication services, data communication and Internet services, as well as paging services.

Beijing Bewinner Communications Co., Ltd. provides telecommunications services to mobile communication users.

Beijing Bewinner Communications Co., (002148 CH)

Kunlun Tech Co., Ltd. offers comprehensive Internet value-added services. The Company focuses on social network interactive and online game fields. Kunlun Tech also provides localized translation outsourcing and agency advertising services.

Bilibili Inc. provides online entertainment services. The Company offers a platform that covers a wide array of genres and media formats, including videos, live broadcasting, mobile games, animation, and comics. Bilibili serves customers in China.

China Ruyi Holdings Limited operates as a holding company. The Company, through its subsidiaries, focuses on online streaming video and internet community businesses. China Ruyi Holdings also manufactures and sells photographic, electronic, and multimedia accessories.

37 Interactive Entertainment Network Technology Group Co.,Ltd designs, develops, and operates mobile games and web games. The Company also provides game promotion, customer service, top-up payment, and other services. 37 Interactive Entertainment Network Technology Group conducts its businesses in China.

37 Interactive Entertainment N (002555 CH)

PT Telekomunikasi Indonesia Persero Tbk is a telecommunication company that provides a variety of domestic telecommunications services such as telephone, telex, telegram, satellite, and leased lines services.  The Company also offers electronic mail, mobile communication, and cellular phone services.

SBA Communications Corporation owns and operates wireless communications infrastructure in the United States. The Company offers site leasing and development, construction, and consulting services. SBA Communications leases antenna space on its multi-tenant towers to a variety of wireless service providers under long-term lease contracts.

Cellnex Telecom S.A.U. is an independent operator of wireless telecommunications infrastructure and broadcast infrastructure. The Company's sites are located in Spain and Italy.

Telefonica S.A. provides telecommunications services mainly to countries in Europe and Latin America.  The Company offers fixed-line and mobile telephone, Internet, and data transmission services to residential and corporate customers.

TELUS Corporation is a telecommunications company providing a variety of communications products and services. The Company provides voice, data, Internet, and wireless services to businesses and consumers in Canada.

Telstra Corporation Limited is a full service domestic and international telecommunications provider for Australia.  The Company provides telephone exchange lines to homes and businesses, supplying local, long distance and international telephone calls and supplying mobile telecommunications services. Telstra also provides data, internet, on-line services and directory services.

China Unicom (Hong Kong) Limited, through its subsidiaries, provides telecommunications services in the People's Republic of China.  The Company's services include cellular, paging, long distance, data, and Internet services.

Chunghwa Telecom Co., Ltd. provides local, domestic, and international long distance services. The Company also offers wireless telecommunication, paging, and Internet services.

Koninklijke KPN NV provides telecommunications services throughout the Netherlands.  The Company provides local, long distance, international, and mobile telecommunications services, voice-mail, call forwarding, ISDN Internet lines, faxing, and communications services for businesses and individuals.  KPN offers mobile telecommunications through E-Plus in Germany and BASE in Belgium.

Orange SA provides telecommunications services to residential, professional, and large business customers. The Company offers public fixed-line telephone, leased lines and data transmission, mobile telecommunications, cable television, Internet and wireless applications, and broadcasting services, and telecommunications equipment sales and rentals.

China Tower Corporation Limited operates as a telecommunication company. The Company provides telecommunication towers construction, towers maintenance, ancillary facilities management, and other services. China Tower provides its services throughout China.

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

China Tower (788 HK)

Mitratel (Dayamitra Telekomunikasi) IPO: Valuation Insights

Mitratel has launched an IPO to raise $1.4-1.8 billion. Our valuation analysis suggests that the IPO price range is attractive. Overall, we would...

Arun George

Mitratel (Dayamitra Telekomunikasi) IPO Initiation: Control Tower

Mitratel has launched an IPO to raise $1.4-1.8 billion. Mitratel is well-placed to benefit from industry consolidation. Overall, Mitratel's...

Arun George

Screening the Silk Road: Q3 2021 High-Risk Names to Avoid

Screening the Silk Road Q3 2021: Asia Pac High-risk names to avoid screening is out now. Eight new names, despite being down 23%, SoftBank remains...

David Lepper

POTUS Executive Order: Potential Additions to the CMIC List

There could be more entities added to Biden's Executive Order if US-China relations continue to worsen. Defense & surveillance stocks, plus subs of...

Brian Freitas

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Mitratel (Dayamitra Telekomunikasi) IPO: Valuation Insights

Mitratel has launched an IPO to raise $1.4-1.8 billion. Our valuation analysis suggests that the IPO price range is attractive. Overall, we would...

Arun George

Mitratel (Dayamitra Telekomunikasi) IPO Initiation: Control Tower

Mitratel has launched an IPO to raise $1.4-1.8 billion. Mitratel is well-placed to benefit from industry consolidation. Overall, Mitratel's...

Arun George

Screening the Silk Road: Q3 2021 High-Risk Names to Avoid

Screening the Silk Road Q3 2021: Asia Pac High-risk names to avoid screening is out now. Eight new names, despite being down 23%, SoftBank remains...

David Lepper

China Telecom A-Share IPO Prices; H-Share Discount Wide; Buy China Mobile

China Telecom has priced its A-share IPO at an 87% premium to the H. To get to the same 2021e DivYield, China Mobile will have to be 20+ higher,...

Travis Lundy

POTUS Executive Order: Potential Additions to the CMIC List

There could be more entities added to Biden's Executive Order if US-China relations continue to worsen. Defense & surveillance stocks, plus subs of...

Brian Freitas