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 Capital Markets

Midea Group Co Ltd A / Equity Capital Markets

<ul>
<li>Aequitas Research's weekly update on the IPOs, placements, lockup expiry and other ECM linked events that were covered by the team over the past week.</li>
<li>On the IPO front, <a href="https://www.smartkarma.com/entities/brainbees-solutions" target="_blank" data-smartkarma-citation="entities:36115:1" rel="noopener">BrainBees</a> contiued along <a href="https://www.smartkarma.com/entities/ola-electric-mobility-pvt-ltd" target="_blank" data-smartkarma-citation="entities:40618:1" rel="noopener">Ola Electric</a>'s path, ensuring that India's ECM wave will continue, for now.</li>
<li>Once again there was only one placement this week, that too in India, just like the week before.</li>
</ul>


Aequitas Research's weekly update on the IPOs, placements, lockup expiry and other ECM linked events that were covered by the team over the past week.
On the IPO front, BrainBees contiued along Ola Electric's path, ensuring that India's ECM wave will continue, for now.
Once again there was only one placement this week, that too in India, just like the week before.


ECM Weekly (19th Aug 2024) - Midea, China Res, WeRide, FirstCry, ACME, Gadgil, 99 Speed, Hind Zinc

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>
<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> has got approval to list on the <a href="https://www.smartkarma.com/entities/hong-kong-exchanges-clearing" target="_blank" data-smartkarma-citation="entities:490:1" rel="noopener">HKEX (388 HK)</a> and reports are that the listing could be up to US$3bn.</li>
<li>That issue size is around half of the maximum that the company can issue. But it would still need cornerstone investors and a nice discount on the H-shares.</li>
<li>The stock will still get included in some indices even with the scaled down size, and inclusion in Southbound Stock Connect is a given.</li>
</ul>



Midea Group Co Ltd A (000333 CH) has got approval to list on the HKEX (388 HK) and reports are that the listing could be up to US$3bn.
That issue size is around half of the maximum that the company can issue. But it would still need cornerstone investors and a nice discount on the H-shares.
The stock will still get included in some indices even with the scaled down size, and inclusion in Southbound Stock Connect is a given.


Midea Group (000333 CH): Index Implications at US$3bn Issue Size

Analyst

Steve

Equity Bottom-Up

<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> posted strong 4Q23 results, with net profit up 18% yoy and sales up 10% yoy. </li>
<li>In terms of 2024 outlook, management targets a 5-10% yoy growth in both the top and bottom line. </li>
<li>The stock is has rerated up to 12x 2024E earnings, compared to an average of 13x over the last 10 years. </li>
</ul>



Midea Group Co Ltd A (000333 CH) posted strong 4Q23 results, with net profit up 18% yoy and sales up 10% yoy. 
In terms of 2024 outlook, management targets a 5-10% yoy growth in both the top and bottom line. 
The stock is has rerated up to 12x 2024E earnings, compared to an average of 13x over the last 10 years. 


Midea Group (000333 CH):  Strong 4Q23 Result As Expected

<ul>
<li>The CSRC has approved <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>'s application to issue H-shares to be listed on the <a href="https://www.smartkarma.com/entities/hong-kong-exchanges-clearing" target="_blank" data-smartkarma-citation="entities:490:1" rel="noopener">HKEX (388 HK)</a>. </li>
<li>Under the approval, <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> can issue up to 650.85m shares. Depending on the H-share discount, that could raise up to HK$43.6bn (US$5.6bn).</li>
<li>The IPO is likely to be smaller and will depend on market conditions and the discount demanded on the H-shares. That in turn will determine index inclusion for the H-shares.</li>
</ul>


The CSRC has approved Midea Group Co Ltd A (000333 CH)'s application to issue H-shares to be listed on the HKEX (388 HK). 
Under the approval, Midea Group Co Ltd A (000333 CH) can issue up to 650.85m shares. Depending on the H-share discount, that could raise up to HK$43.6bn (US$5.6bn).
The IPO is likely to be smaller and will depend on market conditions and the discount demanded on the H-shares. That in turn will determine index inclusion for the H-shares.


Midea Group (000333 CH): CSRC Approval ✓; IPO Size Will Depend on H-Share Discount

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

<ul>
<li>Although Midea’s performance keeps growing, it is difficult for the home appliance industry to return to rapidly growing incremental market as it was during the robust development of real estate.</li>
<li>As Midea’s To C business encounters growth bottleneck, To B business has become new performance driver and second growth curve, but several new businesses are facing challenges in 24Q1.</li>
<li>For mature leading enterprises in home appliance industry, a valuation of 10-20x PE is reasonable, which means market value of RMB370-740 billion, assuming 2024 net profit would reach RMB37 billion.</li>
</ul>


Although Midea’s performance keeps growing, it is difficult for the home appliance industry to return to rapidly growing incremental market as it was during the robust development of real estate.
As Midea’s To C business encounters growth bottleneck, To B business has become new performance driver and second growth curve, but several new businesses are facing challenges in 24Q1.
For mature leading enterprises in home appliance industry, a valuation of 10-20x PE is reasonable, which means market value of RMB370-740 billion, assuming 2024 net profit would reach RMB37 billion.


Pre-IPO Midea Group H Share - Even in the Face of Challenges, There Is Still Investment Value

China

Midea Group CO., LTD manufactures, markets and installs household electrical appliances, compressors and components. Midea also provides services in information technology, corporate investment consultation, software and hardware development, property management and corporate engineering supports. Midea Group provides its products worldwide.

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Midea Group Co Ltd A (000333 CH)

ECM Weekly (19th Aug 2024) - Midea, China Res, WeRide, FirstCry, ACME, Gadgil, 99 Speed, Hind Zinc

Aequitas Research's weekly update on the IPOs, placements, lockup expiry and other ECM linked events that were covered by the team over the past week.

Sumeet Singh

Midea Group (000333 CH): Index Implications at US$3bn Issue Size

The CSRC and HKEX have both approved Midea Group's H-share listing. Reports indicate an issue size of up to US$3bn. Index inclusion gets tougher at...

Brian Freitas

Midea Group (000333 CH): Strong 4Q23 Result As Expected

Major stimulus policy announced yesterday afternoon from China on home appliance: the National Development and Reform Commission and the Ministry...

Steve

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

ECM Weekly (19th Aug 2024) - Midea, China Res, WeRide, FirstCry, ACME, Gadgil, 99 Speed, Hind Zinc

Aequitas Research's weekly update on the IPOs, placements, lockup expiry and other ECM linked events that were covered by the team over the past week.

Sumeet Singh

Midea Group (000333 CH): Index Implications at US$3bn Issue Size

The CSRC and HKEX have both approved Midea Group's H-share listing. Reports indicate an issue size of up to US$3bn. Index inclusion gets tougher at...

Brian Freitas

Midea Group (000333 CH): Strong 4Q23 Result As Expected

Major stimulus policy announced yesterday afternoon from China on home appliance: the National Development and Reform Commission and the Ministry...

Steve

Midea Group (000333 CH): CSRC Approval ✓; IPO Size Will Depend on H-Share Discount

The CSRC has approved Midea Group's application to list H-shares on the HKEX. The amount raised will depend on market conditions, investor...

Brian Freitas

Pre-IPO Midea Group H Share - Even in the Face of Challenges, There Is Still Investment Value

Midea’s To C business encounters growth bottleneck as the industry beta has gone. To B business is new growth driver but it's facing challenges....

Xinyao (Criss) Wang