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

<ul>
<li>
<a href="https://www.smartkarma.com/entities/tokyo-metro-co-ltd" target="_blank" data-smartkarma-citation="entities:40930:1" rel="noopener">Tokyo Metro (9023 JP)</a> priced its IPO at JPY1,200 per share to raise gross proceeds of US$2.3 billion. The shares will start trading on 23 October.</li>
<li>We previously discussed the IPO in <a href="https://www.smartkarma.com/insights/tokyo-metro-9023-jp-ipo-the-bull-case" target="_blank" data-smartkarma-citation="insights:160168" rel="noopener">Tokyo Metro (9023 JP) IPO: The Bull Case</a>, <a href="https://www.smartkarma.com/insights/tokyo-metro-9023-jp-ipo-the-bear-case" target="_blank" data-smartkarma-citation="insights:160399" rel="noopener">Tokyo Metro (9023 JP) IPO: The Bear Case</a> and <a href="https://www.smartkarma.com/insights/tokyo-metro-9023-jp-ipo-valuation-insights" target="_blank" data-smartkarma-citation="insights:161071" rel="noopener">Tokyo Metro (9023 JP) IPO: Valuation Insights</a>.</li>
<li>The peers have modestly derated since the prospectus was released on 20 September. The IPO price remains attractive, particularly relating to the implied dividend yield.</li>
</ul>



Tokyo Metro (9023 JP) priced its IPO at JPY1,200 per share to raise gross proceeds of US$2.3 billion. The shares will start trading on 23 October.
We previously discussed the IPO in Tokyo Metro (9023 JP) IPO: The Bull Case, Tokyo Metro (9023 JP) IPO: The Bear Case and Tokyo Metro (9023 JP) IPO: Valuation Insights.
The peers have modestly derated since the prospectus was released on 20 September. The IPO price remains attractive, particularly relating to the implied dividend yield.


<ul>
<li>
<a href="https://www.smartkarma.com/entities/tokyo-metro-co-ltd" target="_blank" data-smartkarma-citation="entities:40930:1" rel="noopener">Tokyo Metro (9023 JP)</a>, a mass transit operator, is seeking to raise up to US$2.3 billion. Pricing is on 15 October, and the listing is on 23 October.</li>
<li>We previously discussed the IPO in <a href="https://www.smartkarma.com/insights/tokyo-metro-9023-jp-ipo-the-bull-case" target="_blank" data-smartkarma-citation="insights:160168" rel="noopener">Tokyo Metro (9023 JP) IPO: The Bull Case</a> and <a href="https://www.smartkarma.com/insights/tokyo-metro-9023-jp-ipo-the-bear-case" target="_blank" data-smartkarma-citation="insights:160399" rel="noopener">Tokyo Metro (9023 JP) IPO: The Bear Case</a>.</li>
<li>In this note, we discuss valuation. Our analysis suggests that Tokyo Metro is attractively valued at the IPO price compared to peer multiples.</li>
</ul>



Tokyo Metro (9023 JP), a mass transit operator, is seeking to raise up to US$2.3 billion. Pricing is on 15 October, and the listing is on 23 October.
We previously discussed the IPO in Tokyo Metro (9023 JP) IPO: The Bull Case and Tokyo Metro (9023 JP) IPO: The Bear Case.
In this note, we discuss valuation. Our analysis suggests that Tokyo Metro is attractively valued at the IPO price compared to peer multiples.


Tokyo Metro (9023 JP) IPO: Valuation Insights

<ul>
<li>
<a href="https://www.smartkarma.com/entities/tokyo-metro-co-ltd" target="_blank" data-smartkarma-citation="entities:40930:1" rel="noopener">Tokyo Metro (9023 JP)</a>, a mass transit operator, is seeking to raise up to US$2.3 billion. Pricing is on 15 October, and the listing is on 23 October.</li>
<li>In <a href="https://www.smartkarma.com/insights/tokyo-metro-9023-jp-ipo-the-bull-case" target="_blank" data-smartkarma-citation="insights:160168" rel="noopener">Tokyo Metro (9023 JP) IPO: The Bull Case</a>, we highlighted the key elements of the bull case. In this note, we outline the bear case.</li>
<li>The bear case rests on mid-tier revenue growth, low revenue diversification, the highest leverage among peers and a sizeable post-IPO share overhang. </li>
</ul>



Tokyo Metro (9023 JP), a mass transit operator, is seeking to raise up to US$2.3 billion. Pricing is on 15 October, and the listing is on 23 October.
In Tokyo Metro (9023 JP) IPO: The Bull Case, we highlighted the key elements of the bull case. In this note, we outline the bear case.
The bear case rests on mid-tier revenue growth, low revenue diversification, the highest leverage among peers and a sizeable post-IPO share overhang. 


<ul>
<li>
<a href="https://www.smartkarma.com/entities/tokyo-metro" target="_blank" data-smartkarma-citation="entities:40930:1" rel="noopener">Tokyo Metro (TKYMETRO JP)</a>, a mass transit operator, is seeking to raise up to US$2.3 billion. Pricing is on 15 October, and the listing is on 23 October.   </li>
<li>Tokyo Metro is held 53.42% by the Minister of Finance and 46.58% by the Tokyo Metropolitan Government. </li>
<li>The bull case rests on a core high-quality asset, future growth drivers, top-quartile profitability, high FCF generation, and peer-leading dividend payout. </li>
</ul>



Tokyo Metro (TKYMETRO JP), a mass transit operator, is seeking to raise up to US$2.3 billion. Pricing is on 15 October, and the listing is on 23 October.   
Tokyo Metro is held 53.42% by the Minister of Finance and 46.58% by the Tokyo Metropolitan Government. 
The bull case rests on a core high-quality asset, future growth drivers, top-quartile profitability, high FCF generation, and peer-leading dividend payout. 


Japan Specialist

Mark Chadwick

Equity Bottom-Up

<ul>
<li>Tosei achieved record revenue and profit, driven by robust growth in its fund management business and a balanced portfolio of stable and sales-driven operations.</li>
<li>Activist investor Dalton acquired a 5.02% stake, highlighting concerns over recent governance decisions and potential Board independence dilution due to the Nagoya Railroad alliance.</li>
<li>Dalton's involvement ensures heightened scrutiny, promising better governance, and potentially favorable outcomes for minority shareholders amid Tosei's continued strong business performance.</li>
</ul>


Tosei achieved record revenue and profit, driven by robust growth in its fund management business and a balanced portfolio of stable and sales-driven operations.
Activist investor Dalton acquired a 5.02% stake, highlighting concerns over recent governance decisions and potential Board independence dilution due to the Nagoya Railroad alliance.
Dalton's involvement ensures heightened scrutiny, promising better governance, and potentially favorable outcomes for minority shareholders amid Tosei's continued strong business performance.


Tosei (8923) | Strong Performance with Dalton’s Governance Watch

Japan

Nagoya Railroad Co., Ltd. mainly provides passenger rail and bus transportation services in the Chubu area.  The Company also leases and sells real estate and operates leisure-related businesses such as department stores, hotels, and travel agents.

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Nagoya Railroad (9048 JP)

Tokyo Metro (9023 JP) IPO: Trading Debut

The shares will start trading on 23 October. The IPO price remains attractive, particularly relating to the implied dividend yield.

Arun George

Tokyo Metro (9023 JP) IPO: Valuation Insights

Tokyo Metro had set its IPO price range at JPY1,100-1,200, compared to the IPO reference price of JPY1,100. The upper end of the price range...

Arun George

Tokyo Metro (9023 JP) IPO: The Bear Case

The bear case rests on mid-tier revenue growth, low revenue diversification, the highest leverage among peers and a sizeable post-IPO share overhang.

Arun George

Tokyo Metro (9023 JP) IPO: The Bull Case

The bull case rests on a core high-quality asset, future growth drivers, top-quartile profitability, high FCF generation, and peer-leading dividend...

Arun George

Tosei (8923) | Strong Performance with Dalton’s Governance Watch

Tosei sees record revenue and profit, but activist investor Dalton's stake highlights governance concerns and promises better oversight for...

Mark Chadwick

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Tokyo Metro (9023 JP) IPO: Trading Debut

The shares will start trading on 23 October. The IPO price remains attractive, particularly relating to the implied dividend yield.

Arun George

Tokyo Metro (9023 JP) IPO: Valuation Insights

Tokyo Metro had set its IPO price range at JPY1,100-1,200, compared to the IPO reference price of JPY1,100. The upper end of the price range...

Arun George

Tokyo Metro (9023 JP) IPO: The Bear Case

The bear case rests on mid-tier revenue growth, low revenue diversification, the highest leverage among peers and a sizeable post-IPO share overhang.

Arun George

Tokyo Metro (9023 JP) IPO: The Bull Case

The bull case rests on a core high-quality asset, future growth drivers, top-quartile profitability, high FCF generation, and peer-leading dividend...

Arun George

Tosei (8923) | Strong Performance with Dalton’s Governance Watch

​Tosei sees record revenue and profit, but activist investor Dalton's stake highlights governance concerns and promises better oversight for...

Mark Chadwick

Tosei sees record revenue and profit, but activist investor Dalton's stake highlights governance concerns and promises better oversight for...