Equity Analyst, LightStream Research

Oshadhi Kumarasiri

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 Capital Markets

<ul>
<li>With churn rates as high as 50% and wholesale customers declining by 27.7% in 9M21, we are not particularly interested in <a href="https://www.smartkarma.com/entities/huitongda" target="_blank" data-smartkarma-citation="entities:33789:1" rel="noopener">Huitongda (9878 HK)</a> over long term.</li>
<li>The valuation looks cheap compared to peers on the surface, but when compared after considering Huitongda’s 1P exposure its at a significant premium to peers.</li>
<li>Given that the market takes time to pick up similar mispricing situations, we think its advisable to wait and see where Huitongda opens, before arranging a short position.</li>
</ul>


With churn rates as high as 50% and wholesale customers declining by 27.7% in 9M21, we are not particularly interested in Huitongda (9878 HK) over long term.
The valuation looks cheap compared to peers on the surface, but when compared after considering Huitongda’s 1P exposure its at a significant premium to peers.
Given that the market takes time to pick up similar mispricing situations, we think its advisable to wait and see where Huitongda opens, before arranging a short position.


Telco/Internet specialist

Kirk Boodry

Redex Research

Equity Bottom-Up

<ul>
<li>Nvidia is reportedly close to throwing in the towel on the acquisition of ARM (although markets have assumed that outcome for awhile)</li>
<li>Softbank can still monetize the asset through an IPO but most likely at a lower valuation and with much fewer proceeds</li>
<li>We believe ARM was the primary source of buyback funds and with VF down $13bn QTD prospects for meaningful buybacks have been pushed out</li>
</ul>


Nvidia is reportedly close to throwing in the towel on the acquisition of ARM (although markets have assumed that outcome for awhile)
Softbank can still monetize the asset through an IPO but most likely at a lower valuation and with much fewer proceeds
We believe ARM was the primary source of buyback funds and with VF down $13bn QTD prospects for meaningful buybacks have been pushed out


Softbank Group - ARM News, Vision Fund Weakness Highlight That Share Buyback Will Be Back Loaded

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.

<ul>
<li>Kakao Bank's six month IPO lock-up will end on 6th Feb 2022. </li>
<li>It will result in freeing up another US$2.5bn+ worth of shares held by a number of pre-IPO and local IPO investors.</li>
<li>In this note, we will talk about the upcoming lock-up expiry.</li>
</ul>


Kakao Bank's six month IPO lock-up will end on 6th Feb 2022. 
It will result in freeing up another US$2.5bn+ worth of shares held by a number of pre-IPO and local IPO investors.
In this note, we will talk about the upcoming lock-up expiry.


Kakao Bank Six-Month Lock-Up - Over US$2.5bn Stock Release Will Only Add to the Recent Rout

<ul>
<li>
<a href="https://www.smartkarma.com/entities/coupang-inc" target="_blank" data-smartkarma-citation="entities:28425:1" rel="noopener">Coupang (CPNG US)</a> was mispriced during the IPO process as the market forgot to take in to account Coupang’s excessive 1P exposure.</li>
<li>After the first day pop, share price has declined more than 60% to partially correct the mispricing that happened during the IPO.</li>
<li>We think that the share price could potentially drop another 50% before Coupang’s valuation multiples (on comparable basis) fall in line with regional peers.</li>
</ul>



Coupang (CPNG US) was mispriced during the IPO process as the market forgot to take in to account Coupang’s excessive 1P exposure.
After the first day pop, share price has declined more than 60% to partially correct the mispricing that happened during the IPO.
We think that the share price could potentially drop another 50% before Coupang’s valuation multiples (on comparable basis) fall in line with regional peers.


Coupang: The Mispricing Is Still Significant

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

<ul>
<li>Coupang reported disappointing results in 3Q 2021. It had sales of $4.6 billion won (up 48.1% YoY but 4.1% below consensus estimates).</li>
<li>One of the most noticeable negative warning sign for Coupang in 3Q 2021 was that its Active Customers declined by 1.2% on a QoQ basis, which is a bad sign.</li>
<li>Another negative on Coupang is the overhang from Softbank's sales of its shares and Softbank could sell more shares of Coupang in the coming months. We remain negative on Coupang. </li>
</ul>


Coupang reported disappointing results in 3Q 2021. It had sales of $4.6 billion won (up 48.1% YoY but 4.1% below consensus estimates).
One of the most noticeable negative warning sign for Coupang in 3Q 2021 was that its Active Customers declined by 1.2% on a QoQ basis, which is a bad sign.
Another negative on Coupang is the overhang from Softbank's sales of its shares and Softbank could sell more shares of Coupang in the coming months. We remain negative on Coupang. 


Coupang - Decline in Active Customers & Lower Than Expected Sales

South Korea

Coupang, Inc. operates as an e-commerce company. The Company offers dynamic end-to-end e-commerce and logistic solutions. Coupang serves customers worldwide.

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Coupang (CPNG US)

Huitongda IPO - Valuation

The valuation looks cheap compared to peers on the surface, but when compared after considering Huitongda’s 1P exposure its at a significant...

Oshadhi Kumarasiri

Kakao Bank Six-Month Lock-Up - Over US$2.5bn Stock Release Will Only Add to the Recent Rout

Kakao Bank's six month IPO lock-up will end on 6th Feb 2022, releasing over US$2.5bn worth of shares. In this note, we will look at the lock-up...

Sumeet Singh

Coupang: The Mispricing Is Still Significant

With revenue expected to decelerate, we calculate that there’s significant further downside potential to Coupang shares as its valuation remains...

Oshadhi Kumarasiri

Coupang - Decline in Active Customers & Lower Than Expected Sales

Coupang had poor results in 3Q 2021. One of the most noticeable negative warning sign for Coupang in 3Q 2021 was that its Active Customers declined...

Douglas Kim

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Huitongda IPO - Valuation

The valuation looks cheap compared to peers on the surface, but when compared after considering Huitongda’s 1P exposure its at a significant...

Oshadhi Kumarasiri

Softbank Group - ARM News, Vision Fund Weakness Highlight That Share Buyback Will Be Back Loaded

Shares never captured Nvidia upside so the collapse of the ARM sale is not surprising but it also removes the primary source of funds for the share...

Kirk Boodry

Kakao Bank Six-Month Lock-Up - Over US$2.5bn Stock Release Will Only Add to the Recent Rout

Kakao Bank's six month IPO lock-up will end on 6th Feb 2022, releasing over US$2.5bn worth of shares. In this note, we will look at the lock-up...

Sumeet Singh

Coupang: The Mispricing Is Still Significant

With revenue expected to decelerate, we calculate that there’s significant further downside potential to Coupang shares as its valuation remains...

Oshadhi Kumarasiri

Coupang - Decline in Active Customers & Lower Than Expected Sales

Coupang had poor results in 3Q 2021. One of the most noticeable negative warning sign for Coupang in 3Q 2021 was that its Active Customers declined...

Douglas Kim