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

Activia Properties / Equity Capital Markets

<div><p><a href="https://www.smartkarma.com/entities/9498" target="_blank" data-smartkarma-citation="entities:9498:1" rel="noopener">Activia Properties Inc (3279 JP)</a>(API) plans to raise around US$200m/JPY22bn to fund the acquisition of three assets worth JPY44bn.</p></div><div>
<p>We have previously covered four other deals in the name: </p>
<ul><li>US$220m in Dec 2018, <a href="https://www.smartkarma.com/insights/activia-properties-placement-time-for-the-annual-fund-raise-dpu-accretive-past-deals-did-well" target="_blank" rel="noopener">Activia Properties Placement - Time for the Annual Fund Raise, DPU Accretive, past Deals Did Well</a>
</li></ul>
</div><div><ul style="list-style-type: disc;">
<li>US$130m in Dec 2017, <a href="https://www.smartkarma.com/insights/activia-properties-placement-back-again-in-just-over-a-year-past-deals-have-done-well" target="_blank" rel="noopener">Activia Properties Placement - Back Again in Just over a Year, past Deals Have Done Well</a>
</li>
<li>US$270m in Nov 2016,  <a href="https://www.smartkarma.com/insights/activia-properties-back-for-the-annual-capital-raise-but-macro-might-not-be-supportive-this-time" target="_blank" rel="noopener">Activia Properties - Back for the Annual Capital Raise but Macro Might Not Be Supportive This</a>, and</li>
<li>US$161m in Dec 2015,  <a href="https://www.smartkarma.com/insights/activia-properties-accretive-acquisition-should-add-to-the-previous-deals-record" target="_blank" rel="noopener">Activia Properties - Accretive Acquisition Should Add to the Previous Deals Record</a>.</li>
</ul></div><div><p>All the prior deals have done well over the short-term. In this note, we will run the deal through our ECM framework and talk about the deal dynamics.</p></div>

Activia Properties Inc (3279 JP)(API) plans to raise around US$200m/JPY22bn to fund the acquisition of three assets worth JPY44bn.
We have previously covered four other deals in the name: 
US$220m in Dec 2018, Activia Properties Placement - Time for the Annual Fund Raise, DPU Accretive, past Deals Did Well


US$130m in Dec 2017, Activia Properties Placement - Back Again in Just over a Year, past Deals Have Done Well

US$270m in Nov 2016,  Activia Properties - Back for the Annual Capital Raise but Macro Might Not Be Supportive This, and
US$161m in Dec 2015,  Activia Properties - Accretive Acquisition Should Add to the Previous Deals Record.
All the prior deals have done well over the short-term. In this note, we will run the deal through our ECM framework and talk about the deal dynamics.

Activia Properties Placement - Accretive Deal but Comes with a Weak Backdrop

Resonac Holdings  / Equity Capital Markets

<p><a href="https://www.smartkarma.com/entities/showa-denko-k-k" target="_blank" data-smartkarma-citation="entities:1496:1" rel="noopener">Showa Denko K.K. (4004 JP)</a> aims to raise around US$745m via a global follow-on offering. Proceeds from the placement will be used to finance its planned capex across its different business segments.</p><p>In this note, we will talk about the deal dynamics and run the deal through our ECM framework.</p>

Showa Denko K.K. (4004 JP) aims to raise around US$745m via a global follow-on offering. Proceeds from the placement will be used to finance its planned capex across its different business segments.In this note, we will talk about the deal dynamics and run the deal through our ECM framework.

Showa Denko Placement - Relatively Large Deal, past Deal Didn’t Do Well

Telco/Internet specialist

Kirk Boodry

Redex Research

Equity Bottom-Up

<p>Rakuten Q2 21 results were mixed with better revenue as core businesses did well but steeper losses as mobile spending grew. The company has not changed broad guidance that peak losses will come in FY21 but roaming costs appear to be a larger issue than we thought with an impact on both margins and the timing of new user acquisition. That makes slippage in network deployment targets slightly more problematic although there should also be some offset from good results in eCommerce which grew YoY despite lapping the very strong lockdown quarter.</p>

Rakuten Q2 21 results were mixed with better revenue as core businesses did well but steeper losses as mobile spending grew. The company has not changed broad guidance that peak losses will come in FY21 but roaming costs appear to be a larger issue than we thought with an impact on both margins and the timing of new user acquisition. That makes slippage in network deployment targets slightly more problematic although there should also be some offset from good results in eCommerce which grew YoY despite lapping the very strong lockdown quarter.

Rakuten (Neutral) - Q2 21 Results Reaction: Roaming Costs Have Become a Big Deal

Expert on Japan Retail and Consumer Markets, JapanConsuming

Michael Causton

Expert on Japan Retail and Consumer Markets

Real Insight on Japanese Consumer Markets

JapanConsuming

JapanConsuming is a specialist research firm producing intelligence on Japanese retail and consumer markets. Founded in 2000, JapanConsuming has become the leading provider of insights on Japanese retailers and consumer trends to retailers, brands, government agencies and investors. As well as a highly regarded monthly report on the market, JapanConsuming produces in-depth reports on retail sectors, seminars on key trends and telephone consulting to investors on trends and retailers.

JapanConsuming was founded by Michael Causton and Roy Larke. 

<p>Mercari may dominate the re-use market but retailers still have a role to play. Komehyo thinks the way to compete is to make it much easier for vendors to sell their stuff and plans to quadruple store numbers to achieve this.</p>
<p>While Mercari will continue to expand faster than competitors, there looks to be room in the market for these more traditional physical retailers. According to the Reuse Business Journal’s recent study, Re-Use Market Data Book 2020, the re-use market is expected to expand to ¥3.25 trillion by 2025, up from ¥2.19 trillion in 2018. One noted trend in the report is the growing acceptance of re-use transactions by more age groups, including seniors.</p>

Mercari may dominate the re-use market but retailers still have a role to play. Komehyo thinks the way to compete is to make it much easier for vendors to sell their stuff and plans to quadruple store numbers to achieve this.
While Mercari will continue to expand faster than competitors, there looks to be room in the market for these more traditional physical retailers. According to the Reuse Business Journal’s recent study, Re-Use Market Data Book 2020, the re-use market is expected to expand to ¥3.25 trillion by 2025, up from ¥2.19 trillion in 2018. One noted trend in the report is the growing acceptance of re-use transactions by more age groups, including seniors.

Komehyo Combats Online Threat with More Stores

<p><a href="https://www.smartkarma.com/entities/rakuten-inc" target="_blank" data-smartkarma-citation="entities:31:1" rel="noopener">Rakuten Inc (4755 JP)</a>  announcement of Symphony is good news. Even with news last quarter of an imminent announcement, we were skeptical on whether company plans to offer its cloud-native network as a service would be material but a 10-year outsourcing contract with Germany’s 1&amp;1 certainly is. And it is likely there are further revenue opportunities beyond that, albeit at smaller scale, as it sells elements of its technology stack a la carte. But there are risks that temper our enthusiasm as system integration (SI) margins tend to be both low and volatile even as it allocates a further $330mn (¥35bn) to make Altiostar a fully owned subsidiary. On balance, the establishment of a second revenue stream de-risks its mobile foray but markets are likely to be hesitant until its fully turns the corner on its Japanese mobile business. We remain at Neutral.</p>

Rakuten Inc (4755 JP)  announcement of Symphony is good news. Even with news last quarter of an imminent announcement, we were skeptical on whether company plans to offer its cloud-native network as a service would be material but a 10-year outsourcing contract with Germany’s 1&amp;1 certainly is. And it is likely there are further revenue opportunities beyond that, albeit at smaller scale, as it sells elements of its technology stack a la carte. But there are risks that temper our enthusiasm as system integration (SI) margins tend to be both low and volatile even as it allocates a further $330mn (¥35bn) to make Altiostar a fully owned subsidiary. On balance, the establishment of a second revenue stream de-risks its mobile foray but markets are likely to be hesitant until its fully turns the corner on its Japanese mobile business. We remain at Neutral.

Rakuten (Neutral) - Long-Promised Debut as Mobile Network SI Has Finally Dropped

Japan

Rakuten Group, Inc. provides Internet services. The Company offers Internet finance services which including "Rakuten Card" and "Rakuten Bank". Rakuten Group also provides digital content services including electronic book services.

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Rakuten (4755 JP)

Activia Properties Placement - Accretive Deal but Comes with a Weak Backdrop

Activia Properties Inc (3279 JP) plans to raise around US$200m/JPY22bn to fund the acquisition of three assets worth JPY44bn.

Sumeet Singh

Showa Denko Placement - Relatively Large Deal, past Deal Didn’t Do Well

Showa Denko K.K. (4004 JP) aims to raise around US$745m via a global follow-on offering. Proceeds from the placement will be used to finance its...

Sumeet Singh

Rakuten (Neutral) - Q2 21 Results Reaction: Roaming Costs Have Become a Big Deal

Rakuten posted solid eCommerce/Fintech results but these are overshadowed by mobile operating losses. The good news is peak losses should fall in...

Kirk Boodry

Komehyo Combats Online Threat with More Stores

Re-use retailers often get a hard rap given the growing dominance of Mercari but many Japanese still support re-use stores for both buying and...

Michael Causton

Rakuten (Neutral) - Long-Promised Debut as Mobile Network SI Has Finally Dropped

Rakuten has unveiled its mobile network-aaS business through a 10-yr contract with Germany's 1&1. Another revenue stream helps de-risk mobile but...

Kirk Boodry

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