Equity Analyst, LightStream Research

Shifara Samsudeen, ACMA, CGMA

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

Jinke Smart Services / Equity Capital Markets

<a href="https://www.smartkarma.com/entities/jinke-smart-services" target="_blank" data-smartkarma-citation="entities:29214:1" rel="noopener">Jinke Smart Services (9666 HK)</a>  is a comprehensive and smart property management services company that offers a wide range of property management services to residential and non-residential properties located across an extensive number of cities in China.The company has set the terms for its IPO, and plans to issue 133m shares at an indicative IPO price of HK$41.8-47.6 per share, and will raise approximately HK$6.3bn (US$816m) at the upper end of the IPO Pricing.The company also has entered into cornerstone investment agreements with a long list of investors including Taikang Life Insurance, Gaoling Fund LP and YHG Investment, Snow Lake China, etc. These cornerstone investors have agreed to subscribe for an aggregate amount of HK$2.7bn worth of shares.In our previous insight on the company’s IPO <a href="https://www.smartkarma.com/insights/jinke-smart-services-ipo-maintenance-secured" target="_blank" data-smartkarma-citation="insights:44825" rel="noopener">Jinke Smart Services IPO: Maintenance Secured</a> , we discussed about the company’s business model, segments and financials. In this insight, we examine the company’s valuation and how it compares to property management service peers in China.

Jinke Smart Services (9666 HK)  is a comprehensive and smart property management services company that offers a wide range of property management services to residential and non-residential properties located across an extensive number of cities in China.The company has set the terms for its IPO, and plans to issue 133m shares at an indicative IPO price of HK$41.8-47.6 per share, and will raise approximately HK$6.3bn (US$816m) at the upper end of the IPO Pricing.The company also has entered into cornerstone investment agreements with a long list of investors including Taikang Life Insurance, Gaoling Fund LP and YHG Investment, Snow Lake China, etc. These cornerstone investors have agreed to subscribe for an aggregate amount of HK$2.7bn worth of shares.In our previous insight on the company’s IPO Jinke Smart Services IPO: Maintenance Secured , we discussed about the company’s business model, segments and financials. In this insight, we examine the company’s valuation and how it compares to property management service peers in China.

Jinke Smart Services IPO: Appealing Valuation

<a href="https://www.smartkarma.com/entities/jinke-smart-services" target="_blank" data-smartkarma-citation="entities:29214:1" rel="noopener">Jinke Smart Services (JKS HK)</a> is a comprehensive and smart property management services company who offers a wide range of property management services to residential and non-residential properties located across an extensive number of cities across China.The company has filed to list its shares on the Hong Kong Stock Exchange and plans to raise around US$700-800m through the IPO. The IPO constitutes a spin-off from Jinke Property Group, a leading real estate development company in China.In this insight, we examine the company’s business model, business segments and its financials.

Jinke Smart Services (JKS HK) is a comprehensive and smart property management services company who offers a wide range of property management services to residential and non-residential properties located across an extensive number of cities across China.The company has filed to list its shares on the Hong Kong Stock Exchange and plans to raise around US$700-800m through the IPO. The IPO constitutes a spin-off from Jinke Property Group, a leading real estate development company in China.In this insight, we examine the company’s business model, business segments and its financials.

Jinke Smart Services IPO: Maintenance Secured

APAC IPOs & Placements

Zhen Zhou, Toh

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.

KWG Living Group / Equity Capital Markets

<a href="https://www.smartkarma.com/entities/kwg-living-group" target="_blank" data-smartkarma-citation="entities:29231:1" rel="noopener">KWG Living Group (3913 HK)</a> (KLG) raised US$390m at HK$7.89 per share, the upper end of the initial IPO price range. 
KLG is the property management services arm of KWG Group. The company provides management services for residential and commercial properties and, as of December 2019, managed 106 residential properties with a total GFA under management of 18.3m sqm.
In this note, we will look at the deal dynamics and provide a table with implied valuation at different share price levels.
<div>
Our previous coverage of the IPO:
</div>
<div>
<ul style="list-style-type: disc;">
<li>
<a href="https://www.smartkarma.com/insights/kwg-living-pre-ipo-updates-from-phip-resilient-performance-and-better-disclosure" target="_blank" data-smartkarma-citation="insights:44125" rel="noopener">KWG Living (合景悠活) Pre-IPO - Updates from PHIP - Resilient Performance and Better Disclosure</a> </li>
<li>
<a href="https://www.smartkarma.com/entities/loblaw-cos-ltd" target="_blank" data-smartkarma-citation="entities:25150:1" rel="noopener"></a><a href="https://www.smartkarma.com/insights/kwg-living-pre-ipo-strong-growth-and-margin-expansion-but-overly-reliant-on-kwg-group" target="_blank" data-smartkarma-citation="insights:41974" rel="noopener">KWG Living (合景悠活) Pre-IPO - Strong Growth and Margin Expansion but Overly Reliant on KWG Group</a> </li>
<li>
<a href="https://www.smartkarma.com/insights/kwg-living-ipo-not-cheap-but-strong-lineup-of-investors-helps" target="_blank" data-smartkarma-citation="insights:44247" rel="noopener">KWG Living (合景悠活) IPO - Not Cheap but Strong Lineup of Investors Helps</a> </li>
</ul>
</div>

KWG Living Group (3913 HK) (KLG) raised US$390m at HK$7.89 per share, the upper end of the initial IPO price range. 
KLG is the property management services arm of KWG Group. The company provides management services for residential and commercial properties and, as of December 2019, managed 106 residential properties with a total GFA under management of 18.3m sqm.
In this note, we will look at the deal dynamics and provide a table with implied valuation at different share price levels.

Our previous coverage of the IPO:




KWG Living (合景悠活) Pre-IPO - Updates from PHIP - Resilient Performance and Better Disclosure 

KWG Living (合景悠活) Pre-IPO - Strong Growth and Margin Expansion but Overly Reliant on KWG Group 

KWG Living (合景悠活) IPO - Not Cheap but Strong Lineup of Investors Helps 



KWG Living (合景悠活) IPO Trading - Good Demand but Peers Have Traded Lower Since Bookbuild

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Shimao Property Holdings / Equity Capital Markets

The IPO price for <a href="https://www.smartkarma.com/entities/shimao-services-holdings-limited" target="_blank" data-smartkarma-citation="entities:29199:1" rel="noopener">Shimao Services Holdings (873 HK)</a> (SSH), the latest in a long line of property management service companies to be listed, will be announced tomorrow. Shares will commence trading this Friday.
SSH is the spin-off of <a href="https://www.smartkarma.com/entities/shimao-property-holdings-limited" target="_blank" data-smartkarma-citation="entities:8375:1" rel="noopener">Shimao Property Holdings (813 HK)</a>, who will own 66.5% in SSH after the IPO, down from 90% currently.
Similar to <a href="https://www.smartkarma.com/entities/kwg-living-group" target="_blank" data-smartkarma-citation="entities:29231:1" rel="noopener">KWG Living Group (3913 HK)</a>, SSH's implied PER is in keeping with its generous growth the last two years, and arguably can be justified, to some degree, when comparing PER/Growth to peer comps.
However, Shimao Property looks expensive when de-consolidating out the implied market cap of SSH.
As always, more below the fold.

The IPO price for Shimao Services Holdings (873 HK) (SSH), the latest in a long line of property management service companies to be listed, will be announced tomorrow. Shares will commence trading this Friday.
SSH is the spin-off of Shimao Property Holdings (813 HK), who will own 66.5% in SSH after the IPO, down from 90% currently.
Similar to KWG Living Group (3913 HK), SSH's implied PER is in keeping with its generous growth the last two years, and arguably can be justified, to some degree, when comparing PER/Growth to peer comps.
However, Shimao Property looks expensive when de-consolidating out the implied market cap of SSH.
As always, more below the fold. 

Shimao Services: KWG Living-Like Valuation; Parent Trading Rich

Lufax Holdings, a leading financial services firm in China has filed for an IPO in the US. The company has set an indicative IPO price range of US$11.5-13.5 per ADS, and at the midpoint of the IPO price of US$12.50, the company will raise net proceeds of US$2.1bn. The company expects to use the proceeds for general corporate purposes.<table class="table table-striped"><tbody>
<tr><td colspan="2" style="width: 237.0pt;">Lufax Holdings IPO Details</td></tr>
<tr>
<td style="width: 147.0pt;">No. of ADSs Issued</td>
<td style="width: 90.0pt;">175,000,000</td>
</tr>
<tr>
<td style="width: 147.0pt;">Ordinary Shares per ADS</td>
<td style="width: 90.0pt;">0.5</td>
</tr>
<tr>
<td style="width: 147.0pt;">Shares Outstanding Post IPO</td>
<td style="width: 90.0pt;">1,219,678,331</td>
</tr>
<tr>
<td style="width: 147.0pt;">Offer as a % of Outstanding Shares</td>
<td style="width: 90.0pt;">7.17%</td>
</tr>
<tr>
<td style="width: 147.0pt;">Price per ADS (US$)</td>
<td style="width: 90.0pt;">11.50-13.50</td>
</tr>
<tr>
<td style="width: 147.0pt;">Net Proceeds from IPO (US$m)</td>
<td style="width: 90.0pt;">                                     2,109</td>
</tr>
<tr>
<td style="width: 147.0pt;">Market Capitalisation (US$m)</td>
<td style="width: 90.0pt;">                                  30,492</td>
</tr>
<tr>
<td style="width: 147.0pt;">Enterprise Value (US$m)</td>
<td style="width: 90.0pt;">                                  26,911</td>
</tr>
</tbody></table><div class="content-caption">Source: Company Disclosures, LSR (net proceeds, market cap and EV are based on the midpoint of the IPO price range)</div>In our previous insights, we discussed about the company’s business model, its business segments and also a comparison with its key peers. We highlighted that the company shifting its business model from P2P products and services have impacted its top line growth and margins.Read our previous insights:<a href="https://www.smartkarma.com/insights/lufax-ipo-unsecured-loans-drive-top-line-growth-but-risks-remain-despite-capital-light-model" target="_blank" data-smartkarma-citation="insights:44132" rel="noopener">Lufax IPO: Unsecured Loans Drive Top Line Growth but Risks Remain Despite Capital-Light Model</a> <a href="https://www.smartkarma.com/insights/lufax-ipo-shift-in-product-mix-and-higher-customer-acquisition-cost-eat-into-profits" target="_blank" data-smartkarma-citation="insights:44179" rel="noopener">Lufax IPO: Shift in Product Mix and Higher Customer Acquisition Cost Eat into Profits</a> <a href="https://www.smartkarma.com/insights/lufax-ipo-peer-comparison-reveals-change-in-strategy-weighs-heavy-on-company-performance" target="_blank" data-smartkarma-citation="insights:44303" rel="noopener">Lufax IPO: Peer Comparison Reveals Change in Strategy Weighs Heavy on Company Performance</a>

Lufax Holdings, a leading financial services firm in China has filed for an IPO in the US. The company has set an indicative IPO price range of US$11.5-13.5 per ADS, and at the midpoint of the IPO price of US$12.50, the company will raise net proceeds of US$2.1bn. The company expects to use the proceeds for general corporate purposes.
Lufax Holdings IPO Details

No. of ADSs Issued
175,000,000


Ordinary Shares per ADS
0.5


Shares Outstanding Post IPO
1,219,678,331


Offer as a % of Outstanding Shares
7.17%


Price per ADS (US$)
11.50-13.50


Net Proceeds from IPO (US$m)
                                     2,109


Market Capitalisation (US$m)
                                  30,492


Enterprise Value (US$m)
                                  26,911

Source: Company Disclosures, LSR (net proceeds, market cap and EV are based on the midpoint of the IPO price range)In our previous insights, we discussed about the company’s business model, its business segments and also a comparison with its key peers. We highlighted that the company shifting its business model from P2P products and services have impacted its top line growth and margins.Read our previous insights:Lufax IPO: Unsecured Loans Drive Top Line Growth but Risks Remain Despite Capital-Light Model Lufax IPO: Shift in Product Mix and Higher Customer Acquisition Cost Eat into Profits Lufax IPO: Peer Comparison Reveals Change in Strategy Weighs Heavy on Company Performance 

Lufax IPO Valuation: The Risk-Reward Profile Does Not Justify the Premium

China

KWG Living Group is the property management services arm of KWG Group

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KWG Living Group (3913 HK)

Jinke Smart Services IPO: Appealing Valuation

Jinke Smart Services has set the terms for its IPO, and plans to raise approximately HK$6.3bn (US$816m) at the upper end of the IPO Pricing. In...

Shifara Samsudeen, ACMA, CGMA

Jinke Smart Services IPO: Maintenance Secured

Jinke Smart Services has filed for an IPO. In this insight, we deep dive into the company's business model, its segments and financials.

Shifara Samsudeen, ACMA, CGMA

KWG Living (合景悠活) IPO Trading - Good Demand but Peers Have Traded Lower Since Bookbuild

KLG is the property management services arm of KWG Group. In this note, we will look at the deal dynamics and provide a table with implied...

Zhen Zhou, Toh

Shimao Services: KWG Living-Like Valuation; Parent Trading Rich

Shimao Property's trades at a significant premium to the implied P/B for property developers, net of their management services investment holding.

David Blennerhassett

Lufax IPO Valuation: The Risk-Reward Profile Does Not Justify the Premium

In this insight, we evaluate the attractiveness of Lufax's IPO valuation compared to its peers. We believe the company shares are overvalued and...

Shifara Samsudeen, ACMA, CGMA

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