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.

Equity Capital Markets

<div><a href="https://www.smartkarma.com/entities/softbank-group-corp" target="_blank" data-smartkarma-citation="entities:315:1" rel="noopener">Softbank Group (9984 JP)</a> (SBG) is looking to raise about US$11bn by selling some of its shares (10%) in <a href="https://www.smartkarma.com/entities/softbank-corp" target="_blank" data-smartkarma-citation="entities:27445:1" rel="noopener">Softbank Corp (9434 JP)</a> (SBC). Post sell down, SBG will still hold about 2bn shares (about 42% stake) in SBC.</div><div>In this insight, we will look at the deal dynamics, recent performance of the company, and run the deal through our deal framework.</div><div>We have previously looked at the May placement, the potential selldown (post announcement selling assets to fund buyback) and its 2018 IPO in:</div><div><ul style="list-style-type: disc;">
<li>
<a href="https://www.smartkarma.com/insights/softbank-corp-placement-overhang-removed-but-raising-more-than-initially-planned" target="_blank" data-smartkarma-citation="insights:42680" rel="noopener">Softbank Corp Placement - Overhang Removed but Raising More than Initially Planned</a> </li>
<li>
<a href="https://www.smartkarma.com/insights/softbank-corp-placement-smaller-than-expected-but-overhang-weighs" target="_blank" data-smartkarma-citation="insights:39614" rel="noopener">Softbank Corp Placement - Smaller Than Expected, but Overhang Weighs</a> </li>
<li>
<a href="https://www.smartkarma.com/insights/softbank-group-driven-placement-softbank-corp-sell-down-will-be-supported-by-yield" target="_blank" data-smartkarma-citation="insights:37792" rel="noopener">Softbank Group-Driven Placement  - Softbank Corp - Sell Down Will Be Supported by Yield</a> </li>
<li>Valuation from a retail investor POV -  <a href="https://www.smartkarma.com/insights/softbank-ipo-review-attractive-from-a-retail-perspective-could-provide-short-term-upside" target="_blank" data-smartkarma-citation="insights:26422" rel="noopener">Softbank IPO Review - Attractive from a Retail Perspective, Could Provide Short-Term Upside</a>
</li>
<li>Valuation from an institutional investor POV - <a href="https://www.smartkarma.com/insights/softbank-corp-ipo-review-yield-ensured-demand-may-not-guarantee-performance" target="_blank" data-smartkarma-citation="insights:26280" rel="noopener">Softbank Corp IPO Review - Yield Ensured Demand May Not Guarantee Performance</a>
</li>
<li>Updates from prospectus - <a href="https://www.smartkarma.com/insights/softbank-corp-ipo-review-updates-from-the-prospectus-segment-breakdown-capex-and-risks" target="_blank" data-smartkarma-citation="insights:25943" rel="noopener">Softbank Corp IPO Review - Segment Breakdown, Capex, and Risks</a>
</li>
<li>Operating metric comparison - <a href="https://www.smartkarma.com/insights/softbank-telecom-pre-ipo-higher-yield-to-compensate-for-poorer-metrics" target="_blank" data-smartkarma-citation="insights:25842" rel="noopener">Softbank Telecom Pre-IPO - Higher Yield to Compensate for Poorer Metrics</a>
</li>
<li>Impact of Rakuten entry and FCF and dividend sustainability analysis - <a href="https://www.smartkarma.com/insights/softbank-telecom-pre-ipo-all-about-the-yield" target="_blank" data-smartkarma-citation="insights:25756" rel="noopener">Softbank Telecom Pre-IPO - All About the Yield</a>
</li>
<li>Company background and overview - <a href="https://www.smartkarma.com/insights/softbank-telecom-pre-ipo-review-vision-is-needed-to-arrive-at-us-90bn-valuation" target="_blank" data-smartkarma-citation="insights:25289" rel="noopener">Softbank Telecom Pre-IPO Review - Vision Is Needed to Arrive at US$90bn Valuation</a>
</li>
</ul></div>

Softbank Group (9984 JP) (SBG) is looking to raise about US$11bn by selling some of its shares (10%) in Softbank Corp (9434 JP) (SBC). Post sell down, SBG will still hold about 2bn shares (about 42% stake) in SBC.In this insight, we will look at the deal dynamics, recent performance of the company, and run the deal through our deal framework.We have previously looked at the May placement, the potential selldown (post announcement selling assets to fund buyback) and its 2018 IPO in:

Softbank Corp Placement - Overhang Removed but Raising More than Initially Planned 

Softbank Corp Placement - Smaller Than Expected, but Overhang Weighs 

Softbank Group-Driven Placement  - Softbank Corp - Sell Down Will Be Supported by Yield 
Valuation from a retail investor POV -  Softbank IPO Review - Attractive from a Retail Perspective, Could Provide Short-Term Upside

Valuation from an institutional investor POV - Softbank Corp IPO Review - Yield Ensured Demand May Not Guarantee Performance

Updates from prospectus - Softbank Corp IPO Review - Segment Breakdown, Capex, and Risks

Operating metric comparison - Softbank Telecom Pre-IPO - Higher Yield to Compensate for Poorer Metrics

Impact of Rakuten entry and FCF and dividend sustainability analysis - Softbank Telecom Pre-IPO - All About the Yield

Company background and overview - Softbank Telecom Pre-IPO Review - Vision Is Needed to Arrive at US$90bn Valuation



Softbank Corp Placement - Quick Update - Wide Discount from Undisturbed but Don't Expect Much

Japan/Asia Long-Short, LightStream Research

Mio Kato

Japan/Asia Long-Short

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.

Event-Driven

The Japanese language Nikkei had an <a href="https://www.nikkei.com/article/DGXLASFL10HM9_Q0A910C2000000/" target="_blank" rel="noopener">article</a> out yesterday after the close discussing the possibility of a Softbank MBO. Of course, with Softbank you really never know, but to us this smells like an attempt to drive a short squeeze. We discuss why below.

The Japanese language Nikkei had an article out yesterday after the close discussing the possibility of a Softbank MBO. Of course, with Softbank you really never know, but to us this smells like an attempt to drive a short squeeze. We discuss why below.

Softbank Group – Funding Secured by Masayoshi Musk?

Founder & CEO Bond Angle, LLC, Bond Angle, LLC

Vicki Bryan

Founder & CEO Bond Angle, LLC

Bond Angle, LLC

Insightful commentary and analysis on bond markets and market movers, including financial, economic, and industry catalysts and management shenanigans. 

High yield market investment research

Credit

<a href="https://www.smartkarma.com/entities/softbank-group-corp" target="_blank" data-smartkarma-citation="entities:315:1" rel="noopener">Softbank Group (9984 JP)</a> was revealed on Friday as the massive NASDAQ whale helping to drive unprecedented option volume in recent weeks with its multi-billion dollar call-buying spree in the biggest tech names, as reported by <a href="https://www.ft.com/content/75587aa6-1f1f-4e9d-b334-3ff866753fa2" target="_blank" rel="noopener">Financial Times</a> and <a href="https://www.wsj.com/articles/softbanks-bet-on-tech-giants-fueled-powerful-market-rally-11599232205" target="_blank" rel="noopener">The Wall Street Journal</a> which confirmed speculation Thursday by <a href="https://www.zerohedge.com/markets/speculation-emerges-over-identity-mystery-marketwide-call-buyer" target="_blank" rel="noopener">Zero Hedge</a>.Softbank's option trades added to $40 billion in call-buying over the past month traced to retail investors. The resulting frenzy netted Softbank <a href="https://www.ft.com/content/53aa19bb-fc9a-46fd-aafd-4bc3669ab161" target="_blank" rel="noopener">$4 billion in option trading gains—on paper—</a>on its own <a href="https://www.wsj.com/articles/softbanks-bet-on-tech-giants-fueled-powerful-market-rally-11599232205" target="_blank" rel="noopener">$50 billion notional exposure</a>. By comparison, Softbank's newly acquired long positions in <a href="https://www.smartkarma.com/entities/amazon-com-inc" target="_blank" data-smartkarma-citation="entities:409:1" rel="noopener">Amazon.com Inc (AMZN US)</a>, <a href="https://www.smartkarma.com/entities/alphabet-inc-cl-c" target="_blank" data-smartkarma-citation="entities:11369:1" rel="noopener">Alphabet Inc Cl C (GOOG US)</a>, <a href="https://www.smartkarma.com/entities/microsoft-corp" target="_blank" data-smartkarma-citation="entities:15273:1" rel="noopener">Microsoft Corp (MSFT US)</a>,  and <a href="https://www.smartkarma.com/entities/tesla-motors-inc" target="_blank" data-smartkarma-citation="entities:20279:1" rel="noopener">Tesla Motors (TSLA US)</a> are worth just <a href="https://www.ft.com/content/3eec59a3-cb51-487c-aacd-68a0c7e46f2f" target="_blank" rel="noopener">$2 billion</a>, almost all that's left of the $10 billion Softbank spent late in the June quarter buying and selling mostly tech stocks at heady prices. Those holdings now are also subject to sharp declines triggered when Softbank's option scheme was revealed. Sure enough, Softbank <a href="https://www.ft.com/content/9e5827e9-893a-453e-b28d-88c1c0adc9d5" target="_blank" rel="noopener">lost $9 billion in market value</a> on Monday.There's plenty of intense scrutiny underway to understand these trades and what their impact ultimately proves to be. I'm more interested in Softbank's drastic change in strategy and its alternative deployment of cash from $40 billion raised in stock fire sales forced by its wary banks and legacy mega-investors who cut him and Softbank off after decades of seemingly endless billions in available funding when his recklessness netted Softbank and Vision Fund tens of billions of dollars in record losses. This certainly is not what Softbank told investors to expect mere weeks ago.Instead, Softbank's actions signal arrogance, or desperation, or worse—that CEO Masayoshi Son feels unrestrained and back in his Star Wars Zone with $40 billion in fresh cash.<div class="content-highlight">Read on for a Bond Angle deep dive into the belly of Softbank, The Whale, and what Son feels free to do with its $40 billion in cash that was pledged to bolster Softbank's bloodied balance sheet.</div>

Softbank Group (9984 JP) was revealed on Friday as the massive NASDAQ whale helping to drive unprecedented option volume in recent weeks with its multi-billion dollar call-buying spree in the biggest tech names, as reported by Financial Times and The Wall Street Journal which confirmed speculation Thursday by Zero Hedge.Softbank's option trades added to $40 billion in call-buying over the past month traced to retail investors. The resulting frenzy netted Softbank $4 billion in option trading gains—on paper—on its own $50 billion notional exposure. By comparison, Softbank's newly acquired long positions in Amazon.com Inc (AMZN US), Alphabet Inc Cl C (GOOG US), Microsoft Corp (MSFT US),  and Tesla Motors (TSLA US) are worth just $2 billion, almost all that's left of the $10 billion Softbank spent late in the June quarter buying and selling mostly tech stocks at heady prices. Those holdings now are also subject to sharp declines triggered when Softbank's option scheme was revealed. Sure enough, Softbank lost $9 billion in market value on Monday.There's plenty of intense scrutiny underway to understand these trades and what their impact ultimately proves to be. I'm more interested in Softbank's drastic change in strategy and its alternative deployment of cash from $40 billion raised in stock fire sales forced by its wary banks and legacy mega-investors who cut him and Softbank off after decades of seemingly endless billions in available funding when his recklessness netted Softbank and Vision Fund tens of billions of dollars in record losses. This certainly is not what Softbank told investors to expect mere weeks ago.Instead, Softbank's actions signal arrogance, or desperation, or worse—that CEO Masayoshi Son feels unrestrained and back in his Star Wars Zone with $40 billion in fresh cash.Read on for a Bond Angle deep dive into the belly of Softbank, The Whale, and what Son feels free to do with its $40 billion in cash that was pledged to bolster Softbank's bloodied balance sheet.

Softbank's Son "Feeling The Force" With Options Funded With Cash It Had Pledged To Protect

The <a href="https://asia.nikkei.com/Politics/Japan-after-Abe/Japan-phone-carriers-fear-rate-cuts-under-a-Prime-Minister-Suga" target="_blank" rel="noopener">Nikkei has highlighted potential risks to Japan’s telcos</a> if Chief Cabinet Minister Yoshihide Suga becomes Japan’s next prime minister as is now widely expected.  While this trade follows on from pressure applied by Suga over the last couple of years and is unlikely to surprise investors we believe the context is important to note and discuss it briefly below.

The Nikkei has highlighted potential risks to Japan’s telcos if Chief Cabinet Minister Yoshihide Suga becomes Japan’s next prime minister as is now widely expected.  While this trade follows on from pressure applied by Suga over the last couple of years and is unlikely to surprise investors we believe the context is important to note and discuss it briefly below.

Softbank Corp – A Simple Suga PM Telco Trade

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Today after the close, and a few days earlier than expected, the Nikkei's “Index Business Office" which administers the Nikkei 225 Average and the other indices announced the Annual Review of the Nikkei 225 Average has resulted in one deletion, and one replacement. 
The stock getting deleted is <a href="https://www.smartkarma.com/entities/nippon-kayaku-co-ltd" target="_blank" data-smartkarma-citation="entities:6971:1" rel="noopener">Nippon Kayaku (4272 JP)</a> and the stock being added is <a href="https://www.smartkarma.com/entities/softbank-corp" target="_blank" data-smartkarma-citation="entities:27445:1" rel="noopener">Softbank Corp (9434 JP)</a>. Softbank Corp is getting added with a Deemed Par Value of 50 yen per share as of the close of 30 September. 
There will be a few other technical changes at the end of September to do with a few stock splits and reverse stock splits but they will have no effect on the index. 
I have been surprised by the lack of aggressive shorting on Nippon Kayaku as it was the odds-on favorite to get the boot. The addition of Softbank Corp will surprise a few people but it may indicate an ongoing trend at the Nikkei to favor a certain kind of rebalance. 
More below the fold.

Today after the close, and a few days earlier than expected, the Nikkei's “Index Business Office" which administers the Nikkei 225 Average and the other indices announced the Annual Review of the Nikkei 225 Average has resulted in one deletion, and one replacement. 
The stock getting deleted is Nippon Kayaku (4272 JP) and the stock being added is Softbank Corp (9434 JP). Softbank Corp is getting added with a Deemed Par Value of 50 yen per share as of the close of 30 September. 
There will be a few other technical changes at the end of September to do with a few stock splits and reverse stock splits but they will have no effect on the index. 
I have been surprised by the lack of aggressive shorting on Nippon Kayaku as it was the odds-on favorite to get the boot. The addition of Softbank Corp will surprise a few people but it may indicate an ongoing trend at the Nikkei to favor a certain kind of rebalance. 
More below the fold.

The 2020 Nikkei 225 Rebalance: Nippon Kayaku OUT and Softbank Corp IN

Japan

Softbank Corporation provides mobile phone telecommunication and networking services. The Company offers mobile communication opening, short messaging function opening, video function opening, and other services. Softbank also provides mobile phones.

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Softbank Corp (9434 JP)

Softbank Corp Placement - Quick Update - Wide Discount from Undisturbed but Don't Expect Much

Softbank Group (9984 JP) (SBG) is looking to raise about US$11bn by selling some of its shares (10%) in Softbank Corp (9434 JP) (SBC). Post sell...

Zhen Zhou, Toh

Softbank Group – Funding Secured by Masayoshi Musk?

The Japanese language Nikkei had an article out yesterday after the close discussing the possibility of a Softbank MBO. Of course, with Softbank...

Mio Kato

Softbank's Son "Feeling The Force" With Options Funded With Cash It Had Pledged To Protect

The market is eager to know what Softbank plans to do with a burgeoning war chest from bigger and bigger stock sales. The better question is why...

Vicki Bryan

Softbank Corp – A Simple Suga PM Telco Trade

The Nikkei has highlighted potential risks to Japan’s telcos if Chief Cabinet Minister Yoshihide Suga becomes Japan’s next prime minister as is now...

Mio Kato

The 2020 Nikkei 225 Rebalance: Nippon Kayaku OUT and Softbank Corp IN

Today after the close, and a few days earlier than expected, the Nikkei's “Index Business Office" which administers the Nikkei 225 Average and the...

Travis Lundy

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52-week Range

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