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 Bottom-Up

<ul>
<li>Kakao Bank (KB) is South Korea’s largest digital bank. It's a subsidiary of Kakao, which holds a 27.3% stake post listing.</li>
<li>It is a branchless digital bank that only started operations in 2017. As of Sep 21, it had a loan book of US$21bn, deposit base of US$24bn and 17.4m customers.</li>
<li>Even though Kakao started operations only in July 2017, by 2020 it had already garnered more than 1% market share of overall loans and deposits in South Korea.</li>
</ul>


Kakao Bank (KB) is South Korea’s largest digital bank. It's a subsidiary of Kakao, which holds a 27.3% stake post listing.
It is a branchless digital bank that only started operations in 2017. As of Sep 21, it had a loan book of US$21bn, deposit base of US$24bn and 17.4m customers.
Even though Kakao started operations only in July 2017, by 2020 it had already garnered more than 1% market share of overall loans and deposits in South Korea.


2022 High Conviction - Kakao Bank - A Long Way to Go

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

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Event-Driven

<ul>
<li>The review period for the September rebalance of the KOSPI Size Indices commenced on 1 June and will end on 31 August.</li>
<li>We see 8 migrations from MidCap to LargeCap, 1 new addition to LargeCap, 11 stocks moving from SmallCap to MidCap and 3 new additions to MidCap.</li>
<li>There are a few stocks that are expected to have passive flows from global and local index trackers over the next few months and that will add to the impact.</li>
</ul>


The review period for the September rebalance of the KOSPI Size Indices commenced on 1 June and will end on 31 August.
We see 8 migrations from MidCap to LargeCap, 1 new addition to LargeCap, 11 stocks moving from SmallCap to MidCap and 3 new additions to MidCap.
There are a few stocks that are expected to have passive flows from global and local index trackers over the next few months and that will add to the impact.


KOSPI Size Indices: Outperformance Slows on Momentum Stalls

Equity Capital Markets

Hyundai Motor India  / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/hyundai-motor-co-44d5ac4e-94e3-4be9-b34f-5f3155e7a3d6" target="_blank" data-smartkarma-citation="entities:26936:1" rel="noopener">Hyundai Motor (005385 KS)</a> is looking to raise around US$3bn via listing its India unit, <a href="https://www.smartkarma.com/entities/hyundai-motor-india-ltd" target="_blank" data-smartkarma-citation="entities:40900:1" rel="noopener">Hyundai Motor India</a>. HMI is a wholly owned subsidiary of the Hyundai Motor Group.</li>
<li>HMI primarily manufactures and sells four-wheeler passenger vehicles and parts. Currently its vehicle portfolio includes 13 passenger vehicle models across sedans, hatchbacks, SUVs and battery EVs.</li>
<li>In our previous notes, we have looked at the company’s past performance and undertaken a peer comparison. In this note, we talk about valuations.</li>
</ul>



Hyundai Motor (005385 KS) is looking to raise around US$3bn via listing its India unit, Hyundai Motor India. HMI is a wholly owned subsidiary of the Hyundai Motor Group.
HMI primarily manufactures and sells four-wheeler passenger vehicles and parts. Currently its vehicle portfolio includes 13 passenger vehicle models across sedans, hatchbacks, SUVs and battery EVs.
In our previous notes, we have looked at the company’s past performance and undertaken a peer comparison. In this note, we talk about valuations.


Hyundai Motor India Pre-IPO - Thoughts on Valuation

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

<ul>
<li>We believe the added threat from Apple Pay has been one of the reasons for the worsening profit margins and lower than expected sales growth of Kakao Pay in 2Q23. </li>
<li>After the poor earnings results in 2Q 2023,the consensus is likely to reduce Kakao Pay's sales estimate in 2024 by 3-5% and positive operating profit to be postponed to 2025. </li>
<li>We continue to be Bearish on Kakao Pay due to its high valuations, likelihood of consensus earnings downgrades, heightened competition, and concerns about continued profit margin weakness.   </li>
</ul>


We believe the added threat from Apple Pay has been one of the reasons for the worsening profit margins and lower than expected sales growth of Kakao Pay in 2Q23. 
After the poor earnings results in 2Q 2023,the consensus is likely to reduce Kakao Pay's sales estimate in 2024 by 3-5% and positive operating profit to be postponed to 2025. 
We continue to be Bearish on Kakao Pay due to its high valuations, likelihood of consensus earnings downgrades, heightened competition, and concerns about continued profit margin weakness.   


Kakao Pay: Worsening Profit Margins Due to Heightened Competition

<ul>
<li>
<a href="https://www.smartkarma.com/entities/lg-chem-ltd" target="_blank" data-smartkarma-citation="entities:3583:1" rel="noopener">LG Chem Ltd (051910 KS)</a> aims to raise around US$2bn via offering 2028 and 2030 puttable USD exchangeable bonds for <a href="https://www.smartkarma.com/entities/lg-energy-solution" target="_blank" data-smartkarma-citation="entities:33464:1" rel="noopener">LG Energy Solution (373220 KS)</a> shares.</li>
<li>LG Chem (LGC) had been rumoured to sell down some of its stake in LG Energy Solutions (LGES), hence, this deal will remove the overhang on LGES.</li>
<li>In this note, we have a quick look at the deal and provide our thoughts on the structure.</li>
</ul>



LG Chem Ltd (051910 KS) aims to raise around US$2bn via offering 2028 and 2030 puttable USD exchangeable bonds for LG Energy Solution (373220 KS) shares.
LG Chem (LGC) had been rumoured to sell down some of its stake in LG Energy Solutions (LGES), hence, this deal will remove the overhang on LGES.
In this note, we have a quick look at the deal and provide our thoughts on the structure.


LG Energy - Quick Thoughts on US$2bn EB Offering by Parent

South Korea

Kakao Pay Corp. operates financial businesses. The Company provides online payment, currency encryption, and other services. Kakao Pay conducts businesses in South Korea.

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Kakaopay (377300 KS)

2022 High Conviction - Kakao Bank - A Long Way to Go

Kakao Bank (KB) is South Korea’s largest digital bank. It's a subsidiary of Kakao, which holds a 27.3% stake post listing.

Sumeet Singh

KOSPI Size Indices: Outperformance Slows on Momentum Stalls

There could be 41 stocks migrating between size segments in September. The upward migrations have outperformed the downward migrations but the...

Brian Freitas

Hyundai Motor India Pre-IPO - Thoughts on Valuation

Hyundai Motor (005385 KS) is looking to raise around US$3bn via listing its India unit, Hyundai Motor India. In this note, we talk about valuations.

Sumeet Singh

Kakao Pay: Worsening Profit Margins Due to Heightened Competition

We believe the added threat from Apple Pay has been one of the reasons for the worsening profit margins and lower than expected sales growth of...

Douglas Kim

LG Energy - Quick Thoughts on US$2bn EB Offering by Parent

LG Chem Ltd (051910 KS) aims to raise around US$2bn via offering 2028 and 2030 puttable USD exchangeable bonds for LG Energy Solution (373220 KS)...

Sumeet Singh

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