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>
<a href="https://www.smartkarma.com/entities/midea-group-co-ltd-a" target="_blank" data-smartkarma-citation="entities:16185:1" rel="noopener">Midea Group Co Ltd A (000333 CH)</a> one of the world’s largest home appliance producers, aims to raise up to US$3bn in its H-share listing.</li>
<li>Midea Group is one of the world’s largest home appliance manufacturing companies with a presence in over 200 countries. Its A-shares have been listed since 2013.</li>
<li>We have covered the company and deal background in our previous notes. In this note, we talk about the updates since then.</li>
</ul>



Midea Group Co Ltd A (000333 CH) one of the world’s largest home appliance producers, aims to raise up to US$3bn in its H-share listing.
Midea Group is one of the world’s largest home appliance manufacturing companies with a presence in over 200 countries. Its A-shares have been listed since 2013.
We have covered the company and deal background in our previous notes. In this note, we talk about the updates since then.


Midea A/H Listing - Getting Closer to the US$3bn+ Raising, Has a Narrow Window

HK/China Equity Long-Short

Osbert Tang, CFA

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/haier-smart-home-co-ltd-b3ef445f-0f54-4586-8c58-9073de98d60e" target="_blank" data-smartkarma-citation="entities:31105:1" rel="noopener">Haier Smart Home (6690 HK)</a>'s management is confident about the FY24 outlook, with net profit growth of 12-13% can be sustained.  </li>
<li>Casarte will continue to lead with 10-15% revenue increase. There is room for further margin expansion led by overseas markets and process optimisation in the domestic market.</li>
<li>The plunge in real estate market does not have a material impact on sales and HSH is positive on replacement/upgrade demand. Its FY24F PER of 10.1x is undemanding.</li>
</ul>



Haier Smart Home (6690 HK)'s management is confident about the FY24 outlook, with net profit growth of 12-13% can be sustained.  
Casarte will continue to lead with 10-15% revenue increase. There is room for further margin expansion led by overseas markets and process optimisation in the domestic market.
The plunge in real estate market does not have a material impact on sales and HSH is positive on replacement/upgrade demand. Its FY24F PER of 10.1x is undemanding.


Haier Smart Home (6690 HK): Update Suggests Resilience to Sustain

<ul>
<li>
<a href="https://www.smartkarma.com/entities/haier-smart-home-co-ltd-b3ef445f-0f54-4586-8c58-9073de98d60e" target="_blank" data-smartkarma-citation="entities:31105:1" rel="noopener">Haier Smart Home (6690 HK)</a>'s acquisition of Carrier commercial refrigeration business is earnings accretive. It will also be strategically positive to its growth outlook. </li>
<li>With net cash of Rmb17.3bn, HSH has no problem funding the deal internally. Instead of earning a single-digit return on cash, the business' 9% earnings yield is attractive. </li>
<li>The transaction will extend HSH's application scenarios from household to commercial while elevating its competitiveness in Europe and allowing it to capture the B-end customers. </li>
</ul>



Haier Smart Home (6690 HK)'s acquisition of Carrier commercial refrigeration business is earnings accretive. It will also be strategically positive to its growth outlook. 
With net cash of Rmb17.3bn, HSH has no problem funding the deal internally. Instead of earning a single-digit return on cash, the business' 9% earnings yield is attractive. 
The transaction will extend HSH's application scenarios from household to commercial while elevating its competitiveness in Europe and allowing it to capture the B-end customers. 


Haier Smart Home (6690 HK): Further Expansion of Footprint

<ul>
<li>The weak share price of <a href="https://www.smartkarma.com/entities/haier-smart-home-co-ltd-b3ef445f-0f54-4586-8c58-9073de98d60e" target="_blank" data-smartkarma-citation="entities:31105:1" rel="noopener">Haier Smart Home (6690 HK)</a> looks unjustified given its healthy 1H23 result and solid financial position with net cash equals 11% of share price. </li>
<li>We anticipate product advancement and innovation will allow HSH to gain more market share. Its high-end brand Casarte will sustain as an important driver for earnings performance.</li>
<li>Gross margin looks to have room to expand due to better cost dynamics with digitalisation and AI initiatives. Continued growth in developing overseas market is also positive. </li>
</ul>


The weak share price of Haier Smart Home (6690 HK) looks unjustified given its healthy 1H23 result and solid financial position with net cash equals 11% of share price. 
We anticipate product advancement and innovation will allow HSH to gain more market share. Its high-end brand Casarte will sustain as an important driver for earnings performance.
Gross margin looks to have room to expand due to better cost dynamics with digitalisation and AI initiatives. Continued growth in developing overseas market is also positive. 


Haier Smart Home (6690 HK): Healthy Growth Despite Challenges

<ul>
<li>The weak share price performance of <a href="https://www.smartkarma.com/entities/haier-smart-home-co-ltd-b3ef445f-0f54-4586-8c58-9073de98d60e" target="_blank" data-smartkarma-citation="entities:31105:1" rel="noopener">Haier Smart Home Co Ltd (6690 HK)</a> is unwarranted given the healthy earnings trend, solid net cash position and undemanding valuations.</li>
<li>The 15.9% 1Q23 recurring earnings growth showed its low correlation with the property market while demonstrated the achievement in cost control and rising premium product contribution.</li>
<li>It is set to benefit from government's push for higher penetration of household appliances in rural areas. Meanwhile, recent Rmb depreciation may bring exchange gain for 1H23.</li>
</ul>


The weak share price performance of Haier Smart Home Co Ltd (6690 HK) is unwarranted given the healthy earnings trend, solid net cash position and undemanding valuations.
The 15.9% 1Q23 recurring earnings growth showed its low correlation with the property market while demonstrated the achievement in cost control and rising premium product contribution.
It is set to benefit from government's push for higher penetration of household appliances in rural areas. Meanwhile, recent Rmb depreciation may bring exchange gain for 1H23.


Haier Smart Home (6690 HK): Value Emerging

China

Haier Smart Home Co. Ltd. manufactures and distributes appliances. The Company produces air conditioners, refrigerators, freezers, small household electrical appliances, and other related products. Haier Smart Home markets its products domestically and internationally.

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Haier Smart Home (690D GR)

Midea A/H Listing - Getting Closer to the US$3bn+ Raising, Has a Narrow Window

The company has now filed its PHIP and is said to be looking to pre-market its IPO over the coming week, with an aim for launching the IPO later in...

Sumeet Singh

Haier Smart Home (6690 HK): Update Suggests Resilience to Sustain

Haier Smart Home is confident in sustaining 12-13% net profit growth in FY24, with Casarte leading revenue increase and potential for margin...

Osbert Tang, CFA

Haier Smart Home (6690 HK): Further Expansion of Footprint

Haier Smart Home's acquisition of Carrier's commercial refrigeration business is financially beneficial and strategically advantageous, expanding...

Osbert Tang, CFA

Haier Smart Home (6690 HK): Healthy Growth Despite Challenges

Weak share price seems unwarranted despite strong 1H23 results and solid financial position. Market share growth, high-end brand sustainability,...

Osbert Tang, CFA

Haier Smart Home (6690 HK): Value Emerging

Weak share price is unjustified given healthy earnings, net cash position and undemanding valuations. It will benefit from government's push to...

Osbert Tang, CFA

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Midea A/H Listing - Getting Closer to the US$3bn+ Raising, Has a Narrow Window

The company has now filed its PHIP and is said to be looking to pre-market its IPO over the coming week, with an aim for launching the IPO later in...

Sumeet Singh

Haier Smart Home (6690 HK): Update Suggests Resilience to Sustain

​Haier Smart Home is confident in sustaining 12-13% net profit growth in FY24, with Casarte leading revenue increase and potential for margin...

Osbert Tang, CFA

Haier Smart Home (6690 HK): Further Expansion of Footprint

​Haier Smart Home's acquisition of Carrier's commercial refrigeration business is financially beneficial and strategically advantageous, expanding...

Osbert Tang, CFA

Haier Smart Home (6690 HK): Healthy Growth Despite Challenges

Weak share price seems unwarranted despite strong 1H23 results and solid financial position. Market share growth, high-end brand sustainability,...

Osbert Tang, CFA

Haier Smart Home (6690 HK): Value Emerging

Weak share price is unjustified given healthy earnings, net cash position and undemanding valuations. It will benefit from government's push to...

Osbert Tang, CFA

Haier Smart Home is confident in sustaining 12-13% net profit growth in FY24, with Casarte leading revenue increase and potential for margin...

Haier Smart Home's acquisition of Carrier's commercial refrigeration business is financially beneficial and strategically advantageous, expanding...