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

Shanghai MicroPort MedBot Group / Equity Capital Markets

<p><a href="https://www.smartkarma.com/entities/shanghai-microport-medbot-group-co-ltd" target="_blank" data-smartkarma-citation="entities:33485:1" rel="noopener">Shanghai MicroPort MedBot Group (MMG HK)</a> is a surgical robot company which designs, develops and commercialises surgical robots to assist in performing complex surgical procedures. The company has announced the terms for its IPO where it plans to issue 36.2m shares (approx. 4.0% of the total outstanding shares post-IPO) at an indicative IPO price range of HK$36-43.20 per share. At the midpoint of the IPO price range of HK$39.60 per share, MicroPort will raise net proceeds of HK$1,332.3m (US$171.4m) at a market capitalisation of HK$37.7bn and a post-money EV of HK$35.2bn. MicroPort was initially planning to raise about US$0.7-1.0bn through the IPO, however, the offer was significantly downsized to around US$200m.</p><p>MicroPort plans to use about 35.0% of the net IPO proceeds for the development of its core product Toumai and another 21.0% on the company’s orthopedic surgical robots. The company also plans to use 19.0% of the net proceeds on other product candidates and 5.0% on enhancing its manufacturing capacities and supply chain management capabilities. MicroPort also plans to strengthen its product portfolio through in-licensing, acquisition, equity investments and joint ventures and plans to use about 10.0% of the net IPO proceeds for this purpose.</p><p>The company also has entered into cornerstone investment agreements with a number of investors for an aggregate of US$95.0m that will account for 51.6% of the offer shares at the midpoint of the IPO price. These cornerstone investors include Aspex (US$20m), Hillhouse Funds (US$15m), LAV (US$15m), Snow Lake Funds and Accounts (US$15m), Yorkool (US$15m), Cloud Alpha (US$10m) and Artisan (US$5m).</p><p>MicroPort’s product line-up includes three flagship products Toumai (Laparoscopic Surgical Robot), DFVision (3D Electronic Laparoscope) and Honghu (orthopedic surgical robot) and all three are admitted to the NMPA’s innovative medical device special review and approval procedure (known as Green Path). Toumai and Honghu are currently at the registration approval stage while Honghu has received the NMPA approval recently, suggesting that these three products should offer immediate revenue opportunity.</p>

Shanghai MicroPort MedBot Group (MMG HK) is a surgical robot company which designs, develops and commercialises surgical robots to assist in performing complex surgical procedures. The company has announced the terms for its IPO where it plans to issue 36.2m shares (approx. 4.0% of the total outstanding shares post-IPO) at an indicative IPO price range of HK$36-43.20 per share. At the midpoint of the IPO price range of HK$39.60 per share, MicroPort will raise net proceeds of HK$1,332.3m (US$171.4m) at a market capitalisation of HK$37.7bn and a post-money EV of HK$35.2bn. MicroPort was initially planning to raise about US$0.7-1.0bn through the IPO, however, the offer was significantly downsized to around US$200m.MicroPort plans to use about 35.0% of the net IPO proceeds for the development of its core product Toumai and another 21.0% on the company’s orthopedic surgical robots. The company also plans to use 19.0% of the net proceeds on other product candidates and 5.0% on enhancing its manufacturing capacities and supply chain management capabilities. MicroPort also plans to strengthen its product portfolio through in-licensing, acquisition, equity investments and joint ventures and plans to use about 10.0% of the net IPO proceeds for this purpose.The company also has entered into cornerstone investment agreements with a number of investors for an aggregate of US$95.0m that will account for 51.6% of the offer shares at the midpoint of the IPO price. These cornerstone investors include Aspex (US$20m), Hillhouse Funds (US$15m), LAV (US$15m), Snow Lake Funds and Accounts (US$15m), Yorkool (US$15m), Cloud Alpha (US$10m) and Artisan (US$5m).MicroPort’s product line-up includes three flagship products Toumai (Laparoscopic Surgical Robot), DFVision (3D Electronic Laparoscope) and Honghu (orthopedic surgical robot) and all three are admitted to the NMPA’s innovative medical device special review and approval procedure (known as Green Path). Toumai and Honghu are currently at the registration approval stage while Honghu has received the NMPA approval recently, suggesting that these three products should offer immediate revenue opportunity.

MicroPort MedBot IPO: Forecasts, Peer Comparison and Valuation

Global Healthcare Analyst

Tina Banerjee

Equity Bottom-Up

<p>Shares of <a href="https://www.smartkarma.com/entities/intuitive-surgical-inc" target="_blank" data-smartkarma-citation="entities:15853:1" rel="noopener">Intuitive Surgical (ISRG US)</a> corrected ~10% from its 52-week high price of $362 achieved in early September. We believe the correction reflects investors’ fear on the pace of recovery of the elective surgeries globally, especially in the U.S. Amidst this backdrop, the company’s Q3 results announcement on October 19 will be a closely watched event. During their Q2 results announcement, management raised 2021 procedure growth (a key performance parameter) guidance to 27–30% y/y from 22–26% y/y announced during Q1 results announcement. So, outlook on procedure growth guidance for the remainder of the year and early trend into Q4 will the major catalysts for the shares.  Shares of Intuitive Surgical have historically been trading at a high multiple, at par with other high growth ideas such as <a href="https://www.smartkarma.com/entities/abiomed-inc" target="_blank" data-smartkarma-citation="entities:7767:1" rel="noopener">Abiomed Inc (ABMD US)</a>, <a href="https://www.smartkarma.com/entities/align-technology-inc" target="_blank" data-smartkarma-citation="entities:2817:1" rel="noopener">Align Technology (ALGN US)</a>, <a href="https://www.smartkarma.com/entities/idexx-laboratories-inc" target="_blank" data-smartkarma-citation="entities:14856:1" rel="noopener">IDEXX Laboratories (IDXX US)</a>, and <a href="https://www.smartkarma.com/entities/illumina-inc" target="_blank" data-smartkarma-citation="entities:8015:1" rel="noopener">Illumina Inc (ILMN US)</a>. Intuitive’s large market opportunity, especially in the international market, less than 10% penetration of its TAM, near monopolistic market positioning, and high switching cost justify its premium valuation. However, the valuation is always questioned amidst the upcoming competition. As Intuitive’s patent expired, big players including <a href="https://www.smartkarma.com/entities/medtronic-plc" target="_blank" data-smartkarma-citation="entities:14982:1" rel="noopener">Medtronic Plc (MDT US)</a> and <a href="https://www.smartkarma.com/entities/johnson-johnson" target="_blank" data-smartkarma-citation="entities:1132:1" rel="noopener">Johnson &amp; Johnson (JNJ US)</a> are vying to take some share through acquisitions of surgical robot start-up entities. This insight analyzes multiple upcoming competition in the soft tissue surgical robotic market and how Intuitive Surgical is expected to maintain its global leadership amid the competition.</p>

Shares of Intuitive Surgical (ISRG US) corrected ~10% from its 52-week high price of $362 achieved in early September. We believe the correction reflects investors’ fear on the pace of recovery of the elective surgeries globally, especially in the U.S. Amidst this backdrop, the company’s Q3 results announcement on October 19 will be a closely watched event. During their Q2 results announcement, management raised 2021 procedure growth (a key performance parameter) guidance to 27–30% y/y from 22–26% y/y announced during Q1 results announcement. So, outlook on procedure growth guidance for the remainder of the year and early trend into Q4 will the major catalysts for the shares.  Shares of Intuitive Surgical have historically been trading at a high multiple, at par with other high growth ideas such as Abiomed Inc (ABMD US), Align Technology (ALGN US), IDEXX Laboratories (IDXX US), and Illumina Inc (ILMN US). Intuitive’s large market opportunity, especially in the international market, less than 10% penetration of its TAM, near monopolistic market positioning, and high switching cost justify its premium valuation. However, the valuation is always questioned amidst the upcoming competition. As Intuitive’s patent expired, big players including Medtronic Plc (MDT US) and Johnson &amp; Johnson (JNJ US) are vying to take some share through acquisitions of surgical robot start-up entities. This insight analyzes multiple upcoming competition in the soft tissue surgical robotic market and how Intuitive Surgical is expected to maintain its global leadership amid the competition.

Intuitive Surgical (ISRG US): Global Leadership to Continue Amid Upcoming Competition

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.

MicroTech Medical Hangzhou / Equity Capital Markets

<div>
<div><p><a href="https://www.smartkarma.com/entities/microtech-medical-hangzhou-co-ltd" target="_blank" data-smartkarma-citation="entities:33367:1" rel="noopener">MicroTech Medical Hangzhou (2235 HK)</a> is focused on diabetes management, providing both diabetes treatment and diabetes monitoring medical devices to improve diabetes management globally. The core product is Equil which is a semi-disposable patch insulin pump that was commercially launched in 2018 in China.</p></div>
<div>
<p>At the proposed IPO price range of HK$27.70-31.15 per share, Microtech will have a market cap of HK$11,732-13,193 million ($1.5-1.7 billion). At the mid-point of the IPO price range, the net proceeds are HK$1,750.0 million ($225 million).</p>
<p>Eleven cornerstone investors will purchase $153.5 million worth of the offer shares (63.9% of the offer shares at the mid-point of the IPO price range). Two out of the eleven cornerstones are existing investors. They are LAV Group and <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent (700 HK)</a>. The remaining cornerstones which are not existing shareholders are Invesco, UBS AM, Springhill Fund, Hudson Bay, Boyu Capital, Lake Bleu Capital, Octagon Capital, OrbiMed and Sage Partners.</p>
</div>
</div><div><p>In <a href="https://www.smartkarma.com/insights/microtech-medical-ipo-initiation-fighting-diabetes" target="_blank" data-smartkarma-citation="insights:58570" rel="noopener">MicroTech Medical IPO Initiation: Fighting Diabetes</a>, we opined that Microtech has three categories of commercialised products which are Equil (the core product), BGMS and CGMS. Equil is the only patch insulin pump approved in China. In combination with attractive pricing, Equil has significant headroom to increase its China market share from its 3% share in 2020, in our view. Also, AiDEX G7 CGMS, which is currently in the early stage of marketing, presents a near-term growth opportunity. We concluded that Microtech is worth a closer look.</p></div><div><div><div class="content-highlight"><p>Our valuation analysis suggests that the IPO price range is full and we would remain on the sidelines awaiting a better entry opportunity. </p></div></div></div>


MicroTech Medical Hangzhou (2235 HK) is focused on diabetes management, providing both diabetes treatment and diabetes monitoring medical devices to improve diabetes management globally. The core product is Equil which is a semi-disposable patch insulin pump that was commercially launched in 2018 in China.

At the proposed IPO price range of HK$27.70-31.15 per share, Microtech will have a market cap of HK$11,732-13,193 million ($1.5-1.7 billion). At the mid-point of the IPO price range, the net proceeds are HK$1,750.0 million ($225 million).
Eleven cornerstone investors will purchase $153.5 million worth of the offer shares (63.9% of the offer shares at the mid-point of the IPO price range). Two out of the eleven cornerstones are existing investors. They are LAV Group and Tencent (700 HK). The remaining cornerstones which are not existing shareholders are Invesco, UBS AM, Springhill Fund, Hudson Bay, Boyu Capital, Lake Bleu Capital, Octagon Capital, OrbiMed and Sage Partners.

In MicroTech Medical IPO Initiation: Fighting Diabetes, we opined that Microtech has three categories of commercialised products which are Equil (the core product), BGMS and CGMS. Equil is the only patch insulin pump approved in China. In combination with attractive pricing, Equil has significant headroom to increase its China market share from its 3% share in 2020, in our view. Also, AiDEX G7 CGMS, which is currently in the early stage of marketing, presents a near-term growth opportunity. We concluded that Microtech is worth a closer look.Our valuation analysis suggests that the IPO price range is full and we would remain on the sidelines awaiting a better entry opportunity. 

MicroTech Medical IPO: Valuation Insights

<p><a href="https://www.smartkarma.com/entities/microtech-medical-hangzhou-co-ltd" target="_blank" data-smartkarma-citation="entities:33367:1" rel="noopener">MicroTech Medical Hangzhou (2235 HK)</a> is focused on diabetes management, providing both diabetes treatment and diabetes monitoring medical devices to improve diabetes management globally. The core product is Equil which is a semi-disposable patch insulin pump that was commercially launched in 2018 in China. Microtech has launched an HKEx IPO to raise net proceeds of HK$1,750.0 million ($225 million). </p><p>Microtech has a credible management team with a commendable track record in developing and commercialising products. Microtech also has several blue-chip backers such as <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent (700 HK)</a>, Taikang, Lilly AsiaVentures, Qiming Venture Partners, IDG Capital, 3H Health and CICC Pucheng. </p><div class="content-highlight"><p>Microtech has three categories of commercialised products which are Equil (the core product), BGMS and CGMS. Equil is the only patch insulin pump approved in China. In combination with attractive pricing, Equil has significant headroom to increase its market share from its 3% market share in 2020, in our view. Also, AiDEX G7 CGMS, which is currently in the early stage of marketing, presents a near-term growth opportunity. Overall, we believe that Microtech is worth a closer look. We will discuss valuation in our next note. </p></div>

MicroTech Medical Hangzhou (2235 HK) is focused on diabetes management, providing both diabetes treatment and diabetes monitoring medical devices to improve diabetes management globally. The core product is Equil which is a semi-disposable patch insulin pump that was commercially launched in 2018 in China. Microtech has launched an HKEx IPO to raise net proceeds of HK$1,750.0 million ($225 million). Microtech has a credible management team with a commendable track record in developing and commercialising products. Microtech also has several blue-chip backers such as Tencent (700 HK), Taikang, Lilly AsiaVentures, Qiming Venture Partners, IDG Capital, 3H Health and CICC Pucheng. Microtech has three categories of commercialised products which are Equil (the core product), BGMS and CGMS. Equil is the only patch insulin pump approved in China. In combination with attractive pricing, Equil has significant headroom to increase its market share from its 3% market share in 2020, in our view. Also, AiDEX G7 CGMS, which is currently in the early stage of marketing, presents a near-term growth opportunity. Overall, we believe that Microtech is worth a closer look. We will discuss valuation in our next note. 

MicroTech Medical IPO Initiation: Fighting Diabetes

Asia Pac IPO & Placement Research, China biotech, Aequitas Research

Ke Yan, CFA, FRM

Asia Pac IPO & Placement Research, China biotech

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.

<p>MicroTech Medical, a China-based diabetes management medical device company, plans to raise up to USD 300m via a Hong Kong listing.</p><p>The company's core product insulin patch pump system (Equil) has received NMPA approval in 2018 and EU's CE marking in 2017. It has design features that are more appealing than both the tubed players as well as the patch pump competitors. Having said that, we note that the insulin pump market is competitive and the company's sales data after product launch is far from being ideal. </p><p>The company's pre-IPO investor is decent. The management team has relevant product development experience but is not considered a superstar team.</p>

MicroTech Medical, a China-based diabetes management medical device company, plans to raise up to USD 300m via a Hong Kong listing.The company's core product insulin patch pump system (Equil) has received NMPA approval in 2018 and EU's CE marking in 2017. It has design features that are more appealing than both the tubed players as well as the patch pump competitors. Having said that, we note that the insulin pump market is competitive and the company's sales data after product launch is far from being ideal. The company's pre-IPO investor is decent. The management team has relevant product development experience but is not considered a superstar team.

MicroTech (微泰医疗) Pre-IPO: A Story of Domestic Product Replacing International Competitors

United States

Medtronic, PLC develops therapeutic and diagnostic medical products. The Company's principal products include those for bradycardia pacing, tachyarrhythmia management, atrial fibrillation management, heart failure management, heart valve replacement, malignant and non-malignant pain, and movement disorders. Medtronic's products are sold worldwide.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Medtronic Plc (MDT US)

MicroPort MedBot IPO: Forecasts, Peer Comparison and Valuation

Our SOTP valuation (using peer comps and past deal multiples) suggests that MicroPort's IPO is attractive only at the lower end of the indicative...

Shifara Samsudeen, ACMA, CGMA

Intuitive Surgical (ISRG US): Global Leadership to Continue Amid Upcoming Competition

By leveraging on first-mover advantage and huge installed base, Intuitive Surgical is expected to maintain global leadership in robotic surgery...

Tina Banerjee

MicroTech Medical IPO: Valuation Insights

Our valuation analysis suggests that the IPO price range is full and we would remain on the sidelines awaiting a better entry opportunity.

Arun George

MicroTech Medical IPO Initiation: Fighting Diabetes

Microtech has launched an HKEx IPO to raise net proceeds of $225 m. Microtech has three categories of commercialised products and is worth a look at.

Arun George

MicroTech (微泰医疗) Pre-IPO: A Story of Domestic Product Replacing International Competitors

We look at the prospect of MicroTech Medical, an emerging diabetes treatment and management medical device player in China, which is looking to...

Ke Yan, CFA, FRM

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)