Leading International Investment Research, Edison Investment Research

Edison Investment Research

Leading International Investment Research

Edison is an investment research and advisory company, with offices in North America, Europe, the Middle East and AsiaPac. The heart of Edison is our world renowned equity research platform and deep multi-sector expertise. At Edison Investment Research, our research is widely read by international investors, advisors and stakeholders. Edison Advisors leverages our core research platform to provide differentiated services including investor relations and strategic consulting.

Equity Bottom-Up

Having completed its five-year growth plan a year ahead of schedule, despite the intervening pandemic, GlobalData has now set out its ambitions for the next three years. These build on the group’s strengths in platform and proprietary data across its three segments in healthcare (36% of FY23e revenue), consumer (36%) and tech (28%). M&A is a key element, with the group’s financial strength significantly bolstered by the deal with Inflexion in December, where Inflexion took a 40% stake in GlobalData’s healthcare business at an implied valuation equivalent to c 75% of the group’s then market capitalisation. The share price has yet to reflect the benefits of this deal or the value inherent in the rest of the GlobalData.

Having completed its five-year growth plan a year ahead of schedule, despite the intervening pandemic, GlobalData has now set out its ambitions for the next three years. These build on the group’s strengths in platform and proprietary data across its three segments in healthcare (36% of FY23e revenue), consumer (36%) and tech (28%). M&A is a key element, with the group’s financial strength significantly bolstered by the deal with Inflexion in December, where Inflexion took a 40% stake in GlobalData’s healthcare business at an implied valuation equivalent to c 75% of the group’s then market capitalisation. The share price has yet to reflect the benefits of this deal or the value inherent in the rest of the GlobalData.

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.

Equity Capital Markets

<ul>
<li>CIC is looking to raise around US$1.2bn, via selling around 2.6% of its stake in <a href="https://www.smartkarma.com/entities/goodman-group" target="_blank" data-smartkarma-citation="entities:959:1" rel="noopener">Goodman Group (GMG AU)</a> , via a block trade.</li>
<li>Goodman’s shares have performed exceptionally well over the past year, driven by its pivot towards data centers.</li>
<li>In this note, we will talk about the placement and run the deal through our ECM framework.</li>
</ul>


CIC is looking to raise around US$1.2bn, via selling around 2.6% of its stake in Goodman Group (GMG AU) , via a block trade.
Goodman’s shares have performed exceptionally well over the past year, driven by its pivot towards data centers.
In this note, we will talk about the placement and run the deal through our ECM framework.


Goodman Group Placement - Large Shareholder Looking to Raise US$1.2bn but Discount Is Tight

Asset Allocation & Fund Positioning, Copley Fund Research

Steven Holden

Asset Allocation & Fund Positioning

Copley Fund Research

Copley Fund Research provide research and data on asset allocation among Global and Emerging Market equity funds.  The analysis details absolute and relative positioning across countries, sectors and industries together with highly granular data on single stock and single fund allocations.  The data is updated monthly with time series going back to January 2011.

Global Research - Analysis of 165 prominent Global equity funds, combined AUM $335bn
GEM Research - Analysis of 127 prominent global EM equity funds, combined AUM $250bn

Asset Allocation - Global and GEM Equity

Cross Asset Strategy

<ul>
<li>UK Industrials maintain top Sector weight. Real Estate and Consumer Discretionary underweights fund Technology overweight.</li>
<li>Investment Managers Industry group hits record exposure. REITs largely unloved by UK Small/Midcap funds.</li>
<li>Future plc remains the most widely held company. XPS Pensions and Foresight Group Holdings are the top overweights. B&amp;M, Weir Group and Rightmove lead the underweights.</li>
</ul>


UK Industrials maintain top Sector weight. Real Estate and Consumer Discretionary underweights fund Technology overweight.
Investment Managers Industry group hits record exposure. REITs largely unloved by UK Small/Midcap funds.
Future plc remains the most widely held company. XPS Pensions and Foresight Group Holdings are the top overweights. B&amp;M, Weir Group and Rightmove lead the underweights.


SGX Market Strategist, Equity & Fixed Income, Singapore Exchange Ltd (SGX)

Geoff Howie

SGX Market Strategist, Equity & Fixed Income

Asia’s leading multi-asset exchange

Singapore Exchange Ltd (SGX)

Singapore Exchange is Asia’s leading and trusted market infrastructure, facilitating the exchange of capital and ideas to create value for people, businesses and economies. As a multi-asset exchange operating equity, fixed income and derivatives markets to the highest regulatory standards, SGX is a vertically integrated business that provides listing, trading, clearing, settlement, depository and data services.

With about 40% of listed companies and over 80% of listed bonds originating outside of Singapore as well as established linkages across the region and in Europe, SGX is Asia’s most international and connected exchange. Offering a full suite of derivatives products across Asian equity indices, commodities and currencies, SGX is the world’s most liquid international market for the benchmark equity indices of China, India, Japan and ASEAN.

As Asia’s pioneering central counterparty, SGX is globally recognised for its risk management and clearing capabilities, and was one of the first globally to adopt the Principles for Financial Market Infrastructure.

Headquartered in AAA-rated Singapore, SGX has over 800 employees including offices in Beijing, Chicago, Hong Kong, London, New York, Mumbai, San Francisco, Shanghai and Tokyo.

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 <div class='content-caption'>Geo-Chairman</div>
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More than a decade ago, Indonesian entrepreneur Charles Antonny Melati pivoted from property and manufacturing into coal, after noticing a gap in the country’s power generation market. 
“My interest in Indonesia’s coal industry was piqued initially by the frequent power outages and undersupply of electricity in the country,” said the Founder and Executive Chairman of SGX-listed coal producer Geo Energy Resources Ltd.  
At the time, coal was one of the cheapest sources of energy available. The Indonesian government had also announced the first phase of its Fast Track Program in 2006, which aimed to add 10,000 megawatts (MW) of coal-fired energy by 2010.  
“Being a businessman, I started looking for a coal mine to capitalise on this opportunity,” recalled Melati. “In 2008, I entered a joint venture with a company that owned a coal mine. Two years later, my team and I identified viable cost-competitive coal assets and Geo Energy was founded.” 
The growth of Geo Energy in the subsequent years was marked by several significant milestones. They included the Group’s listing on SGX Mainboard in 2012, securing its first mining concession in 2015, transitioning from a coal mining services provider to coal producer the following year, and obtaining its second mining concession in 2018. 
“It has definitely not been easy to build this company from scratch, but the journey has been full of memorable highlights. The learnings over the years have also made it totally worthwhile,” Melati pointed out.  
Lessons along the way included managing stakeholder expectations, educating the market on the viability and future of coal, and now, with the rise of Environment, Social and Governance (ESG) concerns, assuring investors that Geo Energy is able to transition to a sustainable and environmentally responsible business despite being in the fossil fuel industry. 
“I hope to learn and improve continuously as Geo Energy progresses on this journey, and at the same time, give back to society, based on my personal lessons and experiences,” he added. 
Today, Geo Energy is a major Indonesian coal producer with an established track record in operating coal mines, coal production and selling coal throughout the region. It aims to become one of Indonesia’s top 10 coal producers. 
The Group owns four mining concessions in South and East Kalimantan. It actively operates two mines - PT Sungai Danau Jaya (SDJ) and PT Tanah Bumbu Resources (TBR). It has re-started mining operations at PT Bumi Enggang Khatulistiwa (BEK), and plans to commence further exploration at PT Surya Tambang Tolindo (STT).  
While Geo Energy’s coal sales remain focused on Indonesia and China, it has scaled up its presence in other markets such as South Korea, Vietnam and Pakistan. Total coal sales in 2020 reached 10.7 million tonnes, up 45% from the previous year. 
The Group was awarded one of Singapore’s Fastest Growing Companies in 2019 and 2021 by The Straits Times and Statista, based on its strong revenue growth. Stringent Cost Controls 
Looking ahead, Geo Energy remains focused on monitoring and controlling its costs to maximise cash profits from coal sales, Melati said.  
“Indonesian coal prices came under pressure at the start of 2020 due to COVID-19. We knew we had to make our business model more resilient to ensure we remain sustainable and profitable, so we leveraged on long-standing working relationships with our service providers to lower production costs during the pandemic,” he added. 
“We negotiated to keep our costs in tandem with coal prices. When coal prices recover, these costs will adjust upwards, as we share some of the upside with our service providers, and vice versa. This was how we reduced our production costs and delivered superior financial results in the first quarter of 2021.” 
For the three months ended 31 March 2021, Geo Energy’s operating profit surged to US$39 million - the highest in a quarter - from US$7 million in 1Q 2020, while production cash costs fell by 14% to US$23.14 per tonne. 
For now, industry prospects remain bright. The average ICI (Indonesia Coal Index) 4 price has been gaining since late last year - from US$31.07 per tonne in 4Q 2020 to US$41.84 per tonne in 1Q 2021, and US$63.98 on 2 July 2021. 
Demand for the fossil fuel is set to gain 4.5% this year, driven by soaring electricity demand, according to the International Energy Agency. 
Data analytics firm GlobalData has also forecast worldwide coal output to expand at a compound annual growth rate (CAGR) of 2.3% between 2021 and 2025, to reach 8.8 billion tonnes in 2025. China and India are at the forefront of this accelerating demand, and account for two-thirds of global coal consumption.  
“This increasing demand, along with higher prices, lends a positive outlook to our business, as Indonesia is expected to lead the way, being one of the largest net exporters of coal, and on the back of the trade dispute between China and Australia,” Melati noted. 
Expecting solid demand, Indonesia’s Ministry of Energy and Mineral Resources (MEMR) has raised the national coal production target for 2021 by 75 million tonnes to 625 million tonnes. 
“This gives us the opportunity to apply for an increase in production quotas for our SDJ and TBR mines,” he added. “If approved, we would have a higher production target in 2021 during this period of rising coal prices.” Managing Price Volatility 
Nonetheless, coal price risk remains a challenge that must be managed, Melati admitted. 
“Our coal is sold based on index-linked pricing arrangements. There have been, and will be, significant volatility in pricing, including periods of substantial declines. Coal prices are affected by numerous factors beyond our control, including weather, government regulations, environmental protection practices, as well as macroeconomic and geopolitical drivers.” 
As a result, the Group is exploring potential diversification into new businesses and expanding its revenue streams, to reduce its reliance on and exposure to coal price volatility, as well as achieve its sustainability goals, Melati noted. 
“We’re constantly looking to expand our revenues by way of potential joint ventures, trading and value-accretive acquisitions, including mining concessions to increase output. We will also carefully evaluate asset monetisation opportunities as and when we receive a good offer.”  
For sure, the Group is well-aware of the stigma associated with coal. It remains mindful of the importance of balancing economic development needs with climate change goals, which are coming under increasing scrutiny from investors and stakeholders, Melati acknowledged. 
“We’re currently in the eco-friendly coal space, which has low-ash and low-sulphur properties. This allows us to produce coal that can provide energy with the least environmental impact,” he said. 
“At the same time, we’re also committed to our ESG efforts, with corporate social responsibility concepts firmly embedded within our daily operations to protect our people, the environment and the local communities in which we operate.” 
In particular, the Group takes a proactive stance by increasing disclosure of climate metrics, including emissions data, and setting targets to reduce its overall carbon footprint. In 2020, it managed to reduce both energy and carbon intensity by 26%, he added. 
In the meantime, outside the office, there’s nothing more important than family for this 50-year-old father of two sons and a daughter, aged 19 to 26. His favourite pastimes are watching movies and having meals at home. 
“I always tell my children and staff to seize every opportunity when it arises, and stay focused on the things they do,” he noted. 
“Another core value is hard work, because nothing is for free - you need to put in the effort and be hands-on in order to reap the fruits of your labour.” Geo Energy Resources Ltd 
Geo Energy is a major Indonesian coal producer with an established track record in operating coal mines, coal production and selling coal throughout the region. The Group commenced its business in 2008 as a coal mining services provider and listed on SGX Mainboard in 2012. Since then, Geo Energy has transitioned from being primarily a coal mining services provider to a coal producer that subcontracts its coal mining operations. The Group’s investment strategy is focused on the acquisition of new mining concessions to increase production quantity, and at the same time diversify its sources of coal. The Group owns four mining concessions through its wholly owned subsidiaries PT Bumi Enggang Khatulistiwa, PT Sungai Danau Jaya, PT Tanah Bumbu Resources and PT Surya Tambang Tolindo in Kalimantan, Indonesia. 
The company website is: <a href="http://www.geocoal.com/">www.geocoal.com</a> 
Click <a href="https://www.sgx.com/securities/equities/RE4">here </a>for the company's StockFacts page. 
For the six months ended 30 June 2021 financial results, click <a href="https://links.sgx.com/1.0.0/corporate-announcements/HCB1ERKL9P5ASQEW/678197_Geo_1H2021%20Media%20Release.pdf">here</a>. 
 

About kopi-C: the Company brew

Text: Jennifer Tan-Stanisic Photo: Company file kopi-C is a regular column on the SGX Research website that features C-level executives of leading companies listed on Singapore Exchange. These interviews are profiles of senior management aimed at helping investors better understand the individuals who run these corporations. 
For previous editions of kopi-C: the Company brew, please click <a href="https://www.sgx.com/research-education/market-dialogues">here</a>.   
For more information, or if you would like your senior executives to be featured on SGX Market Dialogues, please send suggestions to <a href="https://www.sgx.com/jennifer.t@sgx.com">jennifer.t@sgx.com</a>.
</body></html>


      
    
    Geo-Chairman


More than a decade ago, Indonesian entrepreneur Charles Antonny Melati pivoted from property and manufacturing into coal, after noticing a gap in the country’s power generation market.  
“My interest in Indonesia’s coal industry was piqued initially by the frequent power outages and undersupply of electricity in the country,” said the Founder and Executive Chairman of SGX-listed coal producer Geo Energy Resources Ltd.   
At the time, coal was one of the cheapest sources of energy available. The Indonesian government had also announced the first phase of its Fast Track Program in 2006, which aimed to add 10,000 megawatts (MW) of coal-fired energy by 2010.   
“Being a businessman, I started looking for a coal mine to capitalise on this opportunity,” recalled Melati. “In 2008, I entered a joint venture with a company that owned a coal mine. Two years later, my team and I identified viable cost-competitive coal assets and Geo Energy was founded.”  
The growth of Geo Energy in the subsequent years was marked by several significant milestones. They included the Group’s listing on SGX Mainboard in 2012, securing its first mining concession in 2015, transitioning from a coal mining services provider to coal producer the following year, and obtaining its second mining concession in 2018.  
“It has definitely not been easy to build this company from scratch, but the journey has been full of memorable highlights. The learnings over the years have also made it totally worthwhile,” Melati pointed out.   
Lessons along the way included managing stakeholder expectations, educating the market on the viability and future of coal, and now, with the rise of Environment, Social and Governance (ESG) concerns, assuring investors that Geo Energy is able to transition to a sustainable and environmentally responsible business despite being in the fossil fuel industry.  
“I hope to learn and improve continuously as Geo Energy progresses on this journey, and at the same time, give back to society, based on my personal lessons and experiences,” he added.  
Today, Geo Energy is a major Indonesian coal producer with an established track record in operating coal mines, coal production and selling coal throughout the region. It aims to become one of Indonesia’s top 10 coal producers.  
The Group owns four mining concessions in South and East Kalimantan. It actively operates two mines - PT Sungai Danau Jaya (SDJ) and PT Tanah Bumbu Resources (TBR). It has re-started mining operations at PT Bumi Enggang Khatulistiwa (BEK), and plans to commence further exploration at PT Surya Tambang Tolindo (STT).   
While Geo Energy’s coal sales remain focused on Indonesia and China, it has scaled up its presence in other markets such as South Korea, Vietnam and Pakistan. Total coal sales in 2020 reached 10.7 million tonnes, up 45% from the previous year.  
The Group was awarded one of Singapore’s Fastest Growing Companies in 2019 and 2021 by The Straits Times and Statista, based on its strong revenue growth.  Stringent Cost Controls  
Looking ahead, Geo Energy remains focused on monitoring and controlling its costs to maximise cash profits from coal sales, Melati said.   
“Indonesian coal prices came under pressure at the start of 2020 due to COVID-19. We knew we had to make our business model more resilient to ensure we remain sustainable and profitable, so we leveraged on long-standing working relationships with our service providers to lower production costs during the pandemic,” he added.  
“We negotiated to keep our costs in tandem with coal prices. When coal prices recover, these costs will adjust upwards, as we share some of the upside with our service providers, and vice versa. This was how we reduced our production costs and delivered superior financial results in the first quarter of 2021.”  
For the three months ended 31 March 2021, Geo Energy’s operating profit surged to US$39 million - the highest in a quarter - from US$7 million in 1Q 2020, while production cash costs fell by 14% to US$23.14 per tonne.  
For now, industry prospects remain bright. The average ICI (Indonesia Coal Index) 4 price has been gaining since late last year - from US$31.07 per tonne in 4Q 2020 to US$41.84 per tonne in 1Q 2021, and US$63.98 on 2 July 2021.  
Demand for the fossil fuel is set to gain 4.5% this year, driven by soaring electricity demand, according to the International Energy Agency.  
Data analytics firm GlobalData has also forecast worldwide coal output to expand at a compound annual growth rate (CAGR) of 2.3% between 2021 and 2025, to reach 8.8 billion tonnes in 2025. China and India are at the forefront of this accelerating demand, and account for two-thirds of global coal consumption.   
“This increasing demand, along with higher prices, lends a positive outlook to our business, as Indonesia is expected to lead the way, being one of the largest net exporters of coal, and on the back of the trade dispute between China and Australia,” Melati noted.  
Expecting solid demand, Indonesia’s Ministry of Energy and Mineral Resources (MEMR) has raised the national coal production target for 2021 by 75 million tonnes to 625 million tonnes.  
“This gives us the opportunity to apply for an increase in production quotas for our SDJ and TBR mines,” he added. “If approved, we would have a higher production target in 2021 during this period of rising coal prices.”  Managing Price Volatility  
Nonetheless, coal price risk remains a challenge that must be managed, Melati admitted.  
“Our coal is sold based on index-linked pricing arrangements. There have been, and will be, significant volatility in pricing, including periods of substantial declines. Coal prices are affected by numerous factors beyond our control, including weather, government regulations, environmental protection practices, as well as macroeconomic and geopolitical drivers.”  
As a result, the Group is exploring potential diversification into new businesses and expanding its revenue streams, to reduce its reliance on and exposure to coal price volatility, as well as achieve its sustainability goals, Melati noted.  
“We’re constantly looking to expand our revenues by way of potential joint ventures, trading and value-accretive acquisitions, including mining concessions to increase output. We will also carefully evaluate asset monetisation opportunities as and when we receive a good offer.”   
For sure, the Group is well-aware of the stigma associated with coal. It remains mindful of the importance of balancing economic development needs with climate change goals, which are coming under increasing scrutiny from investors and stakeholders, Melati acknowledged.  
“We’re currently in the eco-friendly coal space, which has low-ash and low-sulphur properties. This allows us to produce coal that can provide energy with the least environmental impact,” he said.  
“At the same time, we’re also committed to our ESG efforts, with corporate social responsibility concepts firmly embedded within our daily operations to protect our people, the environment and the local communities in which we operate.”  
In particular, the Group takes a proactive stance by increasing disclosure of climate metrics, including emissions data, and setting targets to reduce its overall carbon footprint. In 2020, it managed to reduce both energy and carbon intensity by 26%, he added.  
In the meantime, outside the office, there’s nothing more important than family for this 50-year-old father of two sons and a daughter, aged 19 to 26. His favourite pastimes are watching movies and having meals at home.  
“I always tell my children and staff to seize every opportunity when it arises, and stay focused on the things they do,” he noted.  
“Another core value is hard work, because nothing is for free - you need to put in the effort and be hands-on in order to reap the fruits of your labour.”  Geo Energy Resources Ltd  
Geo Energy is a major Indonesian coal producer with an established track record in operating coal mines, coal production and selling coal throughout the region. The Group commenced its business in 2008 as a coal mining services provider and listed on SGX Mainboard in 2012. Since then, Geo Energy has transitioned from being primarily a coal mining services provider to a coal producer that subcontracts its coal mining operations. The Group’s investment strategy is focused on the acquisition of new mining concessions to increase production quantity, and at the same time diversify its sources of coal. The Group owns four mining concessions through its wholly owned subsidiaries PT Bumi Enggang Khatulistiwa, PT Sungai Danau Jaya, PT Tanah Bumbu Resources and PT Surya Tambang Tolindo in Kalimantan, Indonesia.  
The company website is: www.geocoal.com  
Click here for the company's StockFacts page.  
For the six months ended 30 June 2021 financial results, click here.  
 

About kopi-C: the Company brew

Text: Jennifer Tan-Stanisic Photo: Company file  kopi-C is a regular column on the SGX Research website that features C-level executives of leading companies listed on Singapore Exchange. These interviews are profiles of senior management aimed at helping investors better understand the individuals who run these corporations.  
For previous editions of kopi-C: the Company brew, please click here.    
For more information, or if you would like your senior executives to be featured on SGX Market Dialogues, please send suggestions to jennifer.t@sgx.com.



What are the key trends for Biopharma in 2021? Our opening keynote reveals the top 10. Whilst COVID-19 is making all the headlines, Bonnie Bain, Global Head & Executive Vice President of Healthcare Operations & Strategy at GlobalData, reminds us there is a scramble in pharma to adapt to the new conditions and that investors must spot those companies best set to succeed. Welcome and opening remarks by Rachel Carroll, President & Managing Partner, Edison.

United Kingdom

GlobalData plc provides research and consulting solutions for the healthcare, ICT and consumer industries. The Company offers insight and expertise to medical and pharmaceutical markets.

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