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 Capital Markets

Daiwa House Logistics Trust / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/daiwa-house-logistics-trust" target="_blank" data-smartkarma-citation="entities:35020:1" rel="noopener">Daiwa House Logistics Trust (DHLT SP)</a> has launched an SGX IPO to raise gross proceeds of S$464 million ($343 million) at an IPO price of S$0.80 per unit. </li>
<li>DHLT offers an attractive value proposition consisting of a blue-chip tenant base, a staggered lease expiry profile, manageable tenant concentration risk, a growth pipeline and low capex.</li>
<li>DHLT offers exposure to the only Japan pure-play REIT listed in Singapore.</li>
</ul>



Daiwa House Logistics Trust (DHLT SP) has launched an SGX IPO to raise gross proceeds of S$464 million ($343 million) at an IPO price of S$0.80 per unit. 
DHLT offers an attractive value proposition consisting of a blue-chip tenant base, a staggered lease expiry profile, manageable tenant concentration risk, a growth pipeline and low capex.
DHLT offers exposure to the only Japan pure-play REIT listed in Singapore.


Daiwa House Logistics Trust IPO: The Flow of Things

Research from SooChow CSSD Capital Markets (Asia), SCCM Asia Research

SCCM Asia Research

Research from SooChow CSSD Capital Markets (Asia)

Headquartered in Singapore, SooChow CSSD Capital Markets (Asia) is an investment bank focusing on emerging growth companies across Asia, providing a full suite of investment banking services, including corporate finance, mergers and acquisitions advisory, equity capital markets, institutional equities sales and trading and equities research.

SooChow CSSD Capital Markets (Asia)

Thematic (Sector/Industry)

<h2>Singapore</h2><p>SREITs results in a glance (see detailed spreadsheet and calendar attached)</p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/237/629/original/image_32975221321635260585172.png?1635260588" class="editor-image img-responsive" data-smartkarma-image-id="237629"></figure><h3><a href="https://www.smartkarma.com/entities/keppel-reit" target="_blank" data-smartkarma-citation="entities:192" rel="noopener">Keppel REIT (KREIT SP)</a> 3Q21 Business Updates – Robust growth from acquisitions, healthy occupancy and collections</h3><ul><li>9M21 revenue and NPI increased by 34.8% and 36.8% YoY to S$162.2m (74.8% of BB est.) and S$129.4m (75.0% of BB est.), respectively. 9M21 DI was up 20.8% YoY to S$159.9m (83.3% of BB est.), mainly due to contributions from Victoria Police Centre, Pinnacle Office Park and Keppel Bay Tower. The increase in DI was partially offset by the impact of the divestment of 275 George Street in Jul21</li></ul>

SingaporeSREITs results in a glance (see detailed spreadsheet and calendar attached)Keppel REIT (KREIT SP) 3Q21 Business Updates – Robust growth from acquisitions, healthy occupancy and collections9M21 revenue and NPI increased by 34.8% and 36.8% YoY to S$162.2m (74.8% of BB est.) and S$129.4m (75.0% of BB est.), respectively. 9M21 DI was up 20.8% YoY to S$159.9m (83.3% of BB est.), mainly due to contributions from Victoria Police Centre, Pinnacle Office Park and Keppel Bay Tower. The increase in DI was partially offset by the impact of the divestment of 275 George Street in Jul21

APAC IPOs & Placements, Aequitas Research

Clarence Chu

APAC 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

CapitaLand Ascendas REIT / Equity Bottom-Up

<p><a href="https://www.smartkarma.com/entities/ascendas-real-estate-investment-trust" target="_blank" data-smartkarma-citation="entities:39:1" rel="noopener">Ascendas Real Estate Investment Trust (AREIT SP)</a> reported its 3Q21 business updates post-market on 19 Oct 21. In this note, we will analyze its performance for the period, current capital management, and share our thoughts on its outlook.</p>

Ascendas Real Estate Investment Trust (AREIT SP) reported its 3Q21 business updates post-market on 19 Oct 21. In this note, we will analyze its performance for the period, current capital management, and share our thoughts on its outlook.

Ascendas REIT 3Q21 - Data Centres Could Unlock Re-Rating Opportunity

<h2>Singapore</h2><h3>New private home sales fell 31% MoM in Sep21; Take-up rate remained robust at ~400%</h3><ul><li>Sales of new private homes fell again in Sep21 as developers delayed launches amid a sharp rise in Covid-19 cases and tighter safe-management measures. Developers sold 834 units in Sep21, down 31% MoM from 1,216 units in Aug21. On a YoY basis, sales were down 37% from 1,329 units in Sep20. Including ECs sold, developers moved 1,322 new homes last month, 2.0% lower MoM than in Aug21 and 6.4% lower YoY from Sep20</li></ul>

SingaporeNew private home sales fell 31% MoM in Sep21; Take-up rate remained robust at ~400%Sales of new private homes fell again in Sep21 as developers delayed launches amid a sharp rise in Covid-19 cases and tighter safe-management measures. Developers sold 834 units in Sep21, down 31% MoM from 1,216 units in Aug21. On a YoY basis, sales were down 37% from 1,329 units in Sep20. Including ECs sold, developers moved 1,322 new homes last month, 2.0% lower MoM than in Aug21 and 6.4% lower YoY from Sep20

Event-Driven

<p><a href="https://www.smartkarma.com/entities/esr-reit" target="_blank" data-smartkarma-citation="entities:10934:1" rel="noopener">ESR-REIT (EREIT SP)</a> announced the proposed merger with <a href="https://www.smartkarma.com/entities/ara-logos-logistics-trust" target="_blank" data-smartkarma-citation="entities:937:1" rel="noopener">ARA LOGOS (ALLT SP)</a> by way of a trust scheme of arrangement. Under the scheme consideration, each ALLT unitholder will receive S$0.095 in cash and 1.6765 new EREIT units at an issue price of S$0.510. The total consideration implies a gross exchange ratio of 1.863x and a total scheme consideration of S$0.950 per ALLT unit, which is a 1.6% premium to the ALLT last close price of S$0.935 per unit (on 14 October). </p><p>The merger was widely anticipated to avoid conflicts of interest arising from the proposed acquisition of ARA Asset Management by <a href="https://www.smartkarma.com/entities/esr-cayman-ltd" target="_blank" data-smartkarma-citation="entities:27983:1" rel="noopener">ESR Cayman (1821 HK)</a> for a total consideration of US$5.2 billion, which was announced on 5 August 2021. ESR Cayman which owns 67% of EREIT’s manager would also own 100% of ALLT’s manager on completion of the acquisition resulting in overlapping investment mandates.</p><p>A key issue is on pricing particularly the EREIT issue price of S$0.510 which is based on EREIT’s 52-week high. Notably, at the last close EREIT price of S$0.465, implies a scheme consideration of S$0.875 per ALLT unit, which is a -6.5% discount to the ALLT last close price of S$0.935 per unit (on 14 October). </p><div class="content-highlight"><p>As the cash consideration represents just 10% of the total scheme consideration, ALLT unitholders have greater exposure to any post-merger share price gains driven by the enlarged REIT’s higher free float, lower cost of capital, cost savings and higher growth potential. While short-term pricing concerns will linger, we note that the scheme consideration even at the last close EREIT price seems reasonable. Consequently, we believe that the merger will get the nod from both sets of unitholders.</p></div>

ESR-REIT (EREIT SP) announced the proposed merger with ARA LOGOS (ALLT SP) by way of a trust scheme of arrangement. Under the scheme consideration, each ALLT unitholder will receive S$0.095 in cash and 1.6765 new EREIT units at an issue price of S$0.510. The total consideration implies a gross exchange ratio of 1.863x and a total scheme consideration of S$0.950 per ALLT unit, which is a 1.6% premium to the ALLT last close price of S$0.935 per unit (on 14 October). The merger was widely anticipated to avoid conflicts of interest arising from the proposed acquisition of ARA Asset Management by ESR Cayman (1821 HK) for a total consideration of US$5.2 billion, which was announced on 5 August 2021. ESR Cayman which owns 67% of EREIT’s manager would also own 100% of ALLT’s manager on completion of the acquisition resulting in overlapping investment mandates.A key issue is on pricing particularly the EREIT issue price of S$0.510 which is based on EREIT’s 52-week high. Notably, at the last close EREIT price of S$0.465, implies a scheme consideration of S$0.875 per ALLT unit, which is a -6.5% discount to the ALLT last close price of S$0.935 per unit (on 14 October). As the cash consideration represents just 10% of the total scheme consideration, ALLT unitholders have greater exposure to any post-merger share price gains driven by the enlarged REIT’s higher free float, lower cost of capital, cost savings and higher growth potential. While short-term pricing concerns will linger, we note that the scheme consideration even at the last close EREIT price seems reasonable. Consequently, we believe that the merger will get the nod from both sets of unitholders.

ESR-REIT’s Proposed Merger with ARA LOGOS

Singapore

Keppel DC REIT is Asia's first pure-play data centre REIT listed on the Singapore Exchange. Keppel DC REIT's investment strategy is to principally invest, directly or indirectly, in a diversified portfolio of income-producing real estate assets which are used primarily for data centre purposes, as well as real estate related assets.

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Keppel DC REIT (KDCREIT SP)

Daiwa House Logistics Trust IPO: The Flow of Things

DHLT has launched an SGX IPO to raise gross proceeds of S$464 million ($343 million). Overall, we believe that DHLT offers an attractive value...

Arun George

ASEAN Builder's Scoop (26Oct21)

KREIT healthy collections; KDCREIT boosted by acquisitions; MLT steady as she goes; CLCT record high NPI; ALLT EFR effect dilutes DPU; MEG raises...

SCCM Asia Research

Ascendas REIT 3Q21 - Data Centres Could Unlock Re-Rating Opportunity

Ascendas Real Estate Investment Trust (AREIT SP) reported its 3Q21 business updates post-market on 19 Oct 21. In this note, we will analyze its...

Clarence Chu

ASEAN Builder's Scoop (18Oct21)

Sep21 new home sales take-up rate at ~400%; KDCREIT/M1 concluded network asset deal; Jervois Mansion sold out @ S$2,548psf; EAGLEHT US units...

SCCM Asia Research

ESR-REIT’s Proposed Merger with ARA LOGOS

A key issue is on pricing particularly the EREIT issue price of S$0.510, based on EREIT’s 52-week high. While short-term pricing concerns will...

Arun George

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