US/Europe Event-Driven Analyst

John DeMasi

Event-Driven

<ul>
<li>Singapore-Based private equity firm Capital Square Partners (“CSP”) engineered combination of Aegis Global and “old” Startek in 2018 to create “new” Startek.</li>
<li>Microcap business process outsourcing ("BPO") company runs outsourced customer contact centers, has improving sales and profitability, and a declining stock price.</li>
<li>On 20December2021, CSP disclosed that it had submitted a “preliminary, non-binding proposal” to acquire all outstanding shares of SRT US not already owned by it for $5.40 per share.</li>
</ul>


Singapore-Based private equity firm Capital Square Partners (“CSP”) engineered combination of Aegis Global and “old” Startek in 2018 to create “new” Startek.
Microcap business process outsourcing ("BPO") company runs outsourced customer contact centers, has improving sales and profitability, and a declining stock price.
On 20December2021, CSP disclosed that it had submitted a “preliminary, non-binding proposal” to acquire all outstanding shares of SRT US not already owned by it for $5.40 per share.


Startek Inc. – SRT US 55% Owner Proposes $5.40 Cash Per Share Squeeze Out

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 Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/tdcx-inc" target="_blank" data-smartkarma-citation="entities:34187:1" rel="noopener">TDCX (TDCX US)</a> offers digital customer experience solutions for innovative technology and blue-chip companies and has global client base including <a href="https://www.smartkarma.com/entities/meta-platforms-inc-class-a-facebook" target="_blank" data-smartkarma-citation="entities:665:1" rel="noopener">Meta Platforms (Facebook) (META US)</a> and <a href="https://www.smartkarma.com/entities/airbnb-inc" target="_blank" data-smartkarma-citation="entities:431:1" rel="noopener">Airbnb Inc (ABNB US)</a> .</li>
<li>The company’s share price has dropped more than 40% since its IPO as its largest clients were negatively impacted due to the Covid-19 outbreak.</li>
<li>TDCX’s 2Q2022 earnings were strong and the company’s client acquisition strategy is paying off and the share price has moved up 60% since then.</li>
</ul>



TDCX (TDCX US) offers digital customer experience solutions for innovative technology and blue-chip companies and has global client base including Meta Platforms (Facebook) (META US) and Airbnb Inc (ABNB US) .
The company’s share price has dropped more than 40% since its IPO as its largest clients were negatively impacted due to the Covid-19 outbreak.
TDCX’s 2Q2022 earnings were strong and the company’s client acquisition strategy is paying off and the share price has moved up 60% since then.


TDCX: Attractive Growth Profile; Drop in Multiples Offer a Good Entry Point

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

<div>
<p>TDCX Inc, a Singapore-headquartered digital customer experience (CX) provider, raised around US$338m in its US IPO.</p>
</div>
<div>
<p>TDCX provides outsourcing services to clients in new economy sectors and traditional blue-chip clients undergoing digital transformation. As of Jun 21, it served 43 global clients and with 114 active campaigns. The firm has offices located in 10 geographies across Asia, Europe and Latin America, namely, Singapore, the Philippines, Malaysia, Thailand, China, Japan, Spain, India, Columbia and Romania.</p>
</div>
<div>
<p>We have covered various aspects of the deal in our earlier note <a href="https://www.smartkarma.com/insights/tdcx-inc-pre-ipo-tearsheet" target="_blank" rel="noopener">TDCX Inc. Pre-IPO Tearsheet</a>, <a href="https://www.smartkarma.com/insights/tdcx-inc-pre-ipo-past-growth-looks-good-the-rest-is-iffy-including-the-founders-s-325m-payout" target="_blank" rel="noopener">TDCX Inc. Pre-IPO - Past Growth Looks Good, the Rest Is Iffy, Including the Founders S$325m Payout</a> and <a href="https://www.smartkarma.com/insights/tdcx-inc-pre-ipo-largest-client-is-growing-faster-and-trading-cheaper" target="_blank" rel="noopener">TDCX Inc. Pre-IPO - Largest Client Is Growing Faster and Trading Cheaper</a>.</p>
</div>
<div>
<p>In this note, we will talk about the trading dynamics.</p>
</div>


TDCX Inc, a Singapore-headquartered digital customer experience (CX) provider, raised around US$338m in its US IPO.


TDCX provides outsourcing services to clients in new economy sectors and traditional blue-chip clients undergoing digital transformation. As of Jun 21, it served 43 global clients and with 114 active campaigns. The firm has offices located in 10 geographies across Asia, Europe and Latin America, namely, Singapore, the Philippines, Malaysia, Thailand, China, Japan, Spain, India, Columbia and Romania.


We have covered various aspects of the deal in our earlier note TDCX Inc. Pre-IPO Tearsheet, TDCX Inc. Pre-IPO - Past Growth Looks Good, the Rest Is Iffy, Including the Founders S$325m Payout and TDCX Inc. Pre-IPO - Largest Client Is Growing Faster and Trading Cheaper.


In this note, we will talk about the trading dynamics.


<p><a href="https://www.smartkarma.com/entities/tdcx-inc" target="_blank" data-smartkarma-citation="entities:34187:1" rel="noopener">TDCX (TDCX US)</a> provides digital customer experience solutions for innovative technology and other blue-chip companies. The company has announced the indicative IPO price range and the terms for its IPO. TDCX plans to offer 18.8m ADS (each ADS represents one Class A share) at an indicative price range of US$16-18 per ADS, and at the midpoint of US$17 per ADS, the company will raise gross proceeds of US$294.5 (assuming the over-allotment option is not exercised) at a market capitalisation of US$2.4bn and a post-money valuation of US$2.3bn.</p><table class="table table-striped"><tbody>
<tr><td colspan="2" style="width: 252.0pt;"><p style="text-align: center;"><strong>TDCX IPO Details</strong></p></td></tr>
<tr>
<td style="width: 175.75pt;"><p>No. of ADSs Issued</p></td>
<td style="width: 76.25pt;"><p style="text-align: right;">      18,772,000</p></td>
</tr>
<tr>
<td style="width: 175.75pt;"><p>Ordinary Shares per ADS</p></td>
<td style="width: 76.25pt;"><p style="text-align: right;">1.0</p></td>
</tr>
<tr>
<td style="width: 175.75pt;"><p>Shares Outstanding Post IPO</p></td>
<td style="width: 76.25pt;"><p style="text-align: right;">    142,272,000</p></td>
</tr>
<tr>
<td style="width: 175.75pt;"><p>Offer as a % of Outstanding Shares</p></td>
<td style="width: 76.25pt;"><p style="text-align: right;">13.2%</p></td>
</tr>
<tr>
<td style="width: 175.75pt;"><p>Price per ADS (US$)</p></td>
<td style="width: 76.25pt;"><p style="text-align: right;">16-18</p></td>
</tr>
<tr>
<td style="width: 175.75pt;"><p>Net Proceeds (US$m)</p></td>
<td style="width: 76.25pt;"><p style="text-align: right;">294.5</p></td>
</tr>
<tr>
<td style="width: 175.75pt;"><p>Market Capitalisation (US$m)</p></td>
<td style="width: 76.25pt;"><p style="text-align: right;">           2,418.62</p></td>
</tr>
<tr>
<td style="width: 175.75pt;"><p>Enterprise Value (US$m)</p></td>
<td style="width: 76.25pt;"><p style="text-align: right;">           2,339.12</p></td>
</tr>
</tbody></table><div style="text-align: left;" class="content-caption"><em>Source: Company disclosures (net proceeds, market cap and EV are at the midpoint of the IPO price range, we have used the net debt figure given in the roadshow presentation for EV calculation)</em></div><p>The company plans to use approx. US$188.0m (64.0%) of the net IPO proceeds to repay the loan obtained under the Credit Suisse Facility and the remaining net proceeds will be spent on expanding the company’s business into new markets and for general corporate purposes.</p>

TDCX (TDCX US) provides digital customer experience solutions for innovative technology and other blue-chip companies. The company has announced the indicative IPO price range and the terms for its IPO. TDCX plans to offer 18.8m ADS (each ADS represents one Class A share) at an indicative price range of US$16-18 per ADS, and at the midpoint of US$17 per ADS, the company will raise gross proceeds of US$294.5 (assuming the over-allotment option is not exercised) at a market capitalisation of US$2.4bn and a post-money valuation of US$2.3bn.
TDCX IPO Details

No. of ADSs Issued
      18,772,000


Ordinary Shares per ADS
1.0


Shares Outstanding Post IPO
    142,272,000


Offer as a % of Outstanding Shares
13.2%


Price per ADS (US$)
16-18


Net Proceeds (US$m)
294.5


Market Capitalisation (US$m)
           2,418.62


Enterprise Value (US$m)
           2,339.12

Source: Company disclosures (net proceeds, market cap and EV are at the midpoint of the IPO price range, we have used the net debt figure given in the roadshow presentation for EV calculation)The company plans to use approx. US$188.0m (64.0%) of the net IPO proceeds to repay the loan obtained under the Credit Suisse Facility and the remaining net proceeds will be spent on expanding the company’s business into new markets and for general corporate purposes.

<div><p>TDCX Inc, a Singapore-headquartered digital customer experience (CX) provider, is looking to raise up to US$338m in its upcoming US IPO.</p></div><div><p>TDCX provides outsourcing services to clients in new economy sectors and traditional blue-chip clients undergoing digital transformation. As of Jun 21, it served 43 global clients and with 114 active campaigns. The firm has offices located in 10 geographies across Asia, Europe and Latin America, namely, Singapore, the Philippines, Malaysia, Thailand, China, Japan, Spain, India, Columbia and Romania.</p></div><div><p>TDCX has recorded very strong growth with revenue, EBITDA and PAT having increased by 2.5x over FY18-20. In addition, Facebook and Airbnb, combined, contributed 60.4% and 62.3% of TDCX’s total revenue for FY20 and 1H21. </p></div><div><p>We have covered various aspects of the deal in our earlier note <a href="https://www.smartkarma.com/insights/tdcx-inc-pre-ipo-tearsheet" target="_blank" rel="noopener">TDCX Inc. Pre-IPO Tearsheet</a> and <a href="https://www.smartkarma.com/insights/tdcx-inc-pre-ipo-past-growth-looks-good-the-rest-is-iffy-including-the-founders-s-325m-payout" target="_blank" rel="noopener">TDCX Inc. Pre-IPO - Past Growth Looks Good, the Rest Is Iffy, Including the Founders S$325m Payout</a>.</p></div><div><p>In this note we will talk about valuations</p></div>

TDCX Inc, a Singapore-headquartered digital customer experience (CX) provider, is looking to raise up to US$338m in its upcoming US IPO.TDCX provides outsourcing services to clients in new economy sectors and traditional blue-chip clients undergoing digital transformation. As of Jun 21, it served 43 global clients and with 114 active campaigns. The firm has offices located in 10 geographies across Asia, Europe and Latin America, namely, Singapore, the Philippines, Malaysia, Thailand, China, Japan, Spain, India, Columbia and Romania.TDCX has recorded very strong growth with revenue, EBITDA and PAT having increased by 2.5x over FY18-20. In addition, Facebook and Airbnb, combined, contributed 60.4% and 62.3% of TDCX’s total revenue for FY20 and 1H21. We have covered various aspects of the deal in our earlier note TDCX Inc. Pre-IPO Tearsheet and TDCX Inc. Pre-IPO - Past Growth Looks Good, the Rest Is Iffy, Including the Founders S$325m Payout.In this note we will talk about valuations

TDCX Inc. Pre-IPO - Largest Client Is Growing Faster and Trading Cheaper

France

Teleperformance offers customer relationship management services.  The Company operates call centers, conducts programs to attract new customers, offers customer service and technical support services, collects debts, offers market research services, conducts telemarketing, and develops customer relationship management software.

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Teleperformance (TEP FP)

TDCX: Attractive Growth Profile; Drop in Multiples Offer a Good Entry Point

Though TDCX's share price has moved up over the last three weeks, there is further upside as the company's client acquisition has started paying...

Shifara Samsudeen, ACMA, CGMA

TDCX Inc. IPO Trading - Won't Be Buyers

TDCX Inc, a Singapore-headquartered digital customer experience (CX) provider, raised around US$338m in its US IPO. In this note we will talk...

Sumeet Singh

TDCX IPO: Peer Comparison and Valuation

Our relative valuation implies that TDCX's IPO is attractively priced and our reverse DCF suggests annual revenues need to grow 9.5-11% to justify...

Shifara Samsudeen, ACMA, CGMA

TDCX Inc. Pre-IPO - Largest Client Is Growing Faster and Trading Cheaper

TDCX Inc, a Singapore-headquartered digital customer experience (CX) provider, is looking to raise up to US$338m in its upcoming US IPO.

Sumeet Singh

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Startek Inc. – SRT US 55% Owner Proposes $5.40 Cash Per Share Squeeze Out

Dirt-cheap microcap whose 55% owner wants to take private on the cheap. Shares offer 27% upside to proposed buyout price and more upside if special...

John DeMasi

TDCX: Attractive Growth Profile; Drop in Multiples Offer a Good Entry Point

Though TDCX's share price has moved up over the last three weeks, there is further upside as the company's client acquisition has started paying...

Shifara Samsudeen, ACMA, CGMA

TDCX Inc. IPO Trading - Won't Be Buyers

TDCX Inc, a Singapore-headquartered digital customer experience (CX) provider, raised around US$338m in its US IPO. In this note we will talk...

Sumeet Singh

TDCX IPO: Peer Comparison and Valuation

Our relative valuation implies that TDCX's IPO is attractively priced and our reverse DCF suggests annual revenues need to grow 9.5-11% to justify...

Shifara Samsudeen, ACMA, CGMA

TDCX Inc. Pre-IPO - Largest Client Is Growing Faster and Trading Cheaper

TDCX Inc, a Singapore-headquartered digital customer experience (CX) provider, is looking to raise up to US$338m in its upcoming US IPO.

Sumeet Singh