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

Full Truck Alliance   / Equity Capital Markets

<div><p><a href="https://www.smartkarma.com/entities/full-truck-alliance" target="_blank" data-smartkarma-citation="entities:33429:1" rel="noopener">Full Truck Alliance (YMM US)</a> (FTA),  China’s largest digital freight platform by gross transaction value, raised around US$1.6bn via a US listing. It is backed by Softbank and Sequoia.</p></div><div>
<p>In our earlier notes, we spoke about various aspects of the deal in our earlier notes:<a href="https://www.smartkarma.com/insights/full-truck-alliance-pre-ipo-the-positives-category-leader" target="_blank" rel="noopener"></a></p>
<ul>
<li><a href="https://www.smartkarma.com/insights/full-truck-alliance-pre-ipo-the-positives-category-leader" target="_blank" rel="noopener">Full Truck Alliance Pre-IPO - The Positives - Category Leader, </a></li>
<li><a href="https://www.smartkarma.com/insights/full-truck-alliance-pre-ipo-the-negatives-still-a-mixed-bag" target="_blank" rel="noopener">Full Truck Alliance Pre-IPO - The Negatives - Still a Mixed Bag,</a></li>
<li><a href="https://www.smartkarma.com/insights/full-truck-alliance-pre-ipo-valuation-even-the-previous-round-might-have-been-a-stretch" target="_blank" rel="noopener">Full Truck Alliance Pre-IPO - Valuation, Even the Previous Round Might Have Been a Stretch, and</a></li>
<li><a href="https://www.smartkarma.com/insights/full-truck-alliance-ipo-decent-investor-line-up-at-best-a-punt-at-these-valuations" target="_blank" rel="noopener">Full Truck Alliance IPO - Decent Investor Line-Up, at Best a Punt at These Valuations</a></li>
</ul>
<p>In this note, we will talk about the trading dynamics.</p>
</div>

Full Truck Alliance (YMM US) (FTA),  China’s largest digital freight platform by gross transaction value, raised around US$1.6bn via a US listing. It is backed by Softbank and Sequoia.
In our earlier notes, we spoke about various aspects of the deal in our earlier notes:

Full Truck Alliance Pre-IPO - The Positives - Category Leader, 
Full Truck Alliance Pre-IPO - The Negatives - Still a Mixed Bag,
Full Truck Alliance Pre-IPO - Valuation, Even the Previous Round Might Have Been a Stretch, and
Full Truck Alliance IPO - Decent Investor Line-Up, at Best a Punt at These Valuations

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


Full Truck Alliance IPO Trading - Have to Do a Bull Case to Find Some Upside

<div><p><a href="https://www.smartkarma.com/entities/full-truck-alliance" target="_blank" data-smartkarma-citation="entities:33429:1" rel="noopener">Full Truck Alliance (YMM US)</a> (FTA),  China’s largest digital freight platform by gross transaction value, aims to raise up to US$1.6bn via a US listing. It is backed by Softbank and Sequoia.</p></div><div><p>In our earlier notes, we spoke about the positive and negatives aspects of the deal, <a href="https://www.smartkarma.com/insights/full-truck-alliance-pre-ipo-the-positives-category-leader" target="_blank" rel="noopener">Full Truck Alliance Pre-IPO - The Positives - Category Leader</a> and <a href="https://www.smartkarma.com/insights/full-truck-alliance-pre-ipo-the-negatives-still-a-mixed-bag" target="_blank" rel="noopener">Full Truck Alliance Pre-IPO - The Negatives - Still a Mixed Bag,</a> as well as valuations in <a href="https://www.smartkarma.com/insights/full-truck-alliance-pre-ipo-valuation-even-the-previous-round-might-have-been-a-stretch" target="_blank" rel="noopener">Full Truck Alliance Pre-IPO - Valuation, Even the Previous Round Might Have Been a Stretch</a>.</p></div><div><p>In this note, we will talk about the deal dynamics and run the deal through our ECM framework. </p></div>

Full Truck Alliance (YMM US) (FTA),  China’s largest digital freight platform by gross transaction value, aims to raise up to US$1.6bn via a US listing. It is backed by Softbank and Sequoia.In our earlier notes, we spoke about the positive and negatives aspects of the deal, Full Truck Alliance Pre-IPO - The Positives - Category Leader and Full Truck Alliance Pre-IPO - The Negatives - Still a Mixed Bag, as well as valuations in Full Truck Alliance Pre-IPO - Valuation, Even the Previous Round Might Have Been a Stretch.In this note, we will talk about the deal dynamics and run the deal through our ECM framework. 

Full Truck Alliance IPO - Decent Investor Line-Up, at Best a Punt at These Valuations

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

<div class="content-highlight">
<p>Our valuation analysis suggests an implied market cap of US$11.5 billion, representing implied price of $28.67 per share. This would represent an upside of 51% from the high end of the IPO price of $19. Given the strong upside, we would take this IPO deal. We based our valuation based on 9.6x EV/S multiple, which is 150% higher than the average EV/S multiple of its peers in 2022. <strong>We have a positive view of the Kanzhun IPO. </strong></p>
<p>Given the much stronger sales growth of the company combined with impressive improvement in operating losses as a percentage of sales, we believe the company should be valued at much higher valuation multiple than its peers and we believe 9.6x EV/S multiple is appropriate. </p>
<p><strong>Despite being a late comer, Kanzhun has become the largest online recruitment platform in China, as measured by average MAU in 2020.</strong> This is a testament of the company's ability to meet the missing needs of the job seekers and companies that are trying to find new employees. Kanzhun's core product is Boss Zhipin, which is China's leading online recruitment platform app. Boss Zhipin allows employers to interact and connect with job seekers directly through chat rather than simply sending and receiving resumes.</p>
</div>


Our valuation analysis suggests an implied market cap of US$11.5 billion, representing implied price of $28.67 per share. This would represent an upside of 51% from the high end of the IPO price of $19. Given the strong upside, we would take this IPO deal. We based our valuation based on 9.6x EV/S multiple, which is 150% higher than the average EV/S multiple of its peers in 2022. We have a positive view of the Kanzhun IPO. 
Given the much stronger sales growth of the company combined with impressive improvement in operating losses as a percentage of sales, we believe the company should be valued at much higher valuation multiple than its peers and we believe 9.6x EV/S multiple is appropriate. 
Despite being a late comer, Kanzhun has become the largest online recruitment platform in China, as measured by average MAU in 2020. This is a testament of the company's ability to meet the missing needs of the job seekers and companies that are trying to find new employees. Kanzhun's core product is Boss Zhipin, which is China's leading online recruitment platform app. Boss Zhipin allows employers to interact and connect with job seekers directly through chat rather than simply sending and receiving resumes.


Equity Bottom-Up

<div class="content-highlight">
<p>Unlike 2H 2020 when many global tech stocks were roaring higher, it has been more selective so far in 2021, especially among the Chinese tech stocks. In this insight, we discuss the outlook for <a href="https://www.smartkarma.com/entities/tuya-inc" target="_blank" data-smartkarma-citation="entities:32158:1" rel="noopener">Tuya Inc (TUYA US)</a>, which appears to have one of the best momentum among Chinese tech stocks post first quarter results. <a href="https://www.smartkarma.com/entities/tuya-inc" target="_blank" data-smartkarma-citation="entities:32158:1" rel="noopener">Tuya Inc (TUYA US)</a>'s current share price is $26, up 24% from the IPO price of $21. The stock has especially been very strong in May as it is up 34% this month. </p>
<p>Among the 16 major Chinese tech stocks mentioned in this report, Tuya had the highest sales growth rate of 200% YoY in 1Q 2021. The average YoY sales growth of these 16 stocks were 58.6% in 1Q 2021. There were only three stocks that had more than 100% YoY sales growth rate in 1Q 2021, which included Tuya, <a href="https://www.smartkarma.com/entities/pinduoduo-inc" target="_blank" data-smartkarma-citation="entities:27250:1" rel="noopener">Pinduoduo (PDD US)</a>, and <a href="https://www.smartkarma.com/entities/zhihu-technology-ltd" target="_blank" data-smartkarma-citation="entities:32185:1" rel="noopener">Zhihu Technology (ZH US)</a>. </p>
<p>Our conclusion is that we continue to like Tuya as it has one of the best growth prospects among major Chinese tech stocks. It is also experiencing significant improvement in its operating margins. Although its valuation multiple is the highest among the 16 companies mentioned in this insight, we believe investors are willing to pay higher multiples for companies such as Tuya which is experiencing a combination of very strong sales growth as well as improving operating losses as a percentage of revenues. </p>
</div>


Unlike 2H 2020 when many global tech stocks were roaring higher, it has been more selective so far in 2021, especially among the Chinese tech stocks. In this insight, we discuss the outlook for Tuya Inc (TUYA US), which appears to have one of the best momentum among Chinese tech stocks post first quarter results. Tuya Inc (TUYA US)'s current share price is $26, up 24% from the IPO price of $21. The stock has especially been very strong in May as it is up 34% this month. 
Among the 16 major Chinese tech stocks mentioned in this report, Tuya had the highest sales growth rate of 200% YoY in 1Q 2021. The average YoY sales growth of these 16 stocks were 58.6% in 1Q 2021. There were only three stocks that had more than 100% YoY sales growth rate in 1Q 2021, which included Tuya, Pinduoduo (PDD US), and Zhihu Technology (ZH US). 
Our conclusion is that we continue to like Tuya as it has one of the best growth prospects among major Chinese tech stocks. It is also experiencing significant improvement in its operating margins. Although its valuation multiple is the highest among the 16 companies mentioned in this insight, we believe investors are willing to pay higher multiples for companies such as Tuya which is experiencing a combination of very strong sales growth as well as improving operating losses as a percentage of revenues. 


Tuya's Strong Momentum & A Review of China's Tech Stocks Results in 1Q 2021

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.

<p><a href="https://www.smartkarma.com/entities/qiniu-ltd" target="_blank" data-smartkarma-citation="entities:33236:1" rel="noopener">Qiniu (QNIU US)</a> is China's leading cloud-based Platform-as-a-Service (PaaS) provider. Qiniu primarily offers Media Platform-as-a-Service (MPaaS) for intelligent media solutions and Data Platform-as-a-Service (DPaaS) for machine data solutions. It is China's largest pure-play PaaS provider with a 4.4% market share and China's largest independent MPaaS provider with a 7.5% market share by revenue in 2020, according to Frost &amp; Sullivan.</p><p>Qiniu is backed by <a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd" target="_blank" data-smartkarma-citation="entities:787:1" rel="noopener">Alibaba Group (BABA US)</a> (17.7% of outstanding shares), Matrix Partners (8.0%) Qiming Funds (6.8%). Qiniu has filed for a Nasdaq IPO to raise proceeds of $500 million, according to press reports. </p><div class="content-highlight"><p>At first glance, Qiniu should be well-positioned to benefit from this sizeable China's PaaS market opportunity. The strong dollar-based net expansion rate and shift to profitability (based on the company’s adjusted EBITDA metric) and cash generation in 2020 suggests that Qiniu is heading in the right direction. However, a closer look reveals concerning developments on several fronts. In the current market where sentiment on Chinese US listings is weak, we think that the negatives in the Qiniu story warrant a pass.  </p></div>

Qiniu (QNIU US) is China's leading cloud-based Platform-as-a-Service (PaaS) provider. Qiniu primarily offers Media Platform-as-a-Service (MPaaS) for intelligent media solutions and Data Platform-as-a-Service (DPaaS) for machine data solutions. It is China's largest pure-play PaaS provider with a 4.4% market share and China's largest independent MPaaS provider with a 7.5% market share by revenue in 2020, according to Frost &amp; Sullivan.Qiniu is backed by Alibaba Group (BABA US) (17.7% of outstanding shares), Matrix Partners (8.0%) Qiming Funds (6.8%). Qiniu has filed for a Nasdaq IPO to raise proceeds of $500 million, according to press reports. At first glance, Qiniu should be well-positioned to benefit from this sizeable China's PaaS market opportunity. The strong dollar-based net expansion rate and shift to profitability (based on the company’s adjusted EBITDA metric) and cash generation in 2020 suggests that Qiniu is heading in the right direction. However, a closer look reveals concerning developments on several fronts. In the current market where sentiment on Chinese US listings is weak, we think that the negatives in the Qiniu story warrant a pass.  

United States

Tuya Inc., doing business as Tuya Smart, provides IoT cloud platform. The Company offers solutions which enables brands, retailers, OEMs, and manufacturers to develop, launch, manage, and monetize software-enabled devices and services. Tuya Smart serves customers worldwide.

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Tuya Inc (TUYA US)

Full Truck Alliance IPO Trading - Have to Do a Bull Case to Find Some Upside

Full Truck Alliance (YMM US) (FTA), China’s largest digital freight platform by gross transaction value, raised around US$1.6bn via a US listing....

Sumeet Singh

Full Truck Alliance IPO - Decent Investor Line-Up, at Best a Punt at These Valuations

Full Truck Alliance (YMM US), China’s largest digital freight platform by gross transaction value, aims to raise up to US$1.6bn via a US listing....

Sumeet Singh

Kanzhun IPO Valuation Analysis

Our valuation analysis of Kanzhun suggests an implied market cap of US$11.5 billion, representing implied price of $28.67 per share. We would take...

Douglas Kim

Tuya's Strong Momentum & A Review of China's Tech Stocks Results in 1Q 2021

We continue to like Tuya as it has one of the best growth prospects among major Chinese tech stocks. It is also experiencing significant...

Douglas Kim

Qiniu IPO Initiation: A PasS

Qiniu has filed for a Nasdaq IPO to raise proceeds of $500 million, according to press reports. We think that the several negatives in the Qiniu...

Arun George

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