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

LG Energy Solution / Equity Capital Markets

<ul>
<li>Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.</li>
<li>On the IPOs front, Campus Activewear and Rainbow Hospitals will get India's IPO season going again, with LIC in the pipeline.</li>
<li>Placement flows remained slow over the holiday shortened week. With only Taiwan and India seeing deals.</li>
</ul>


Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
On the IPOs front, Campus Activewear and Rainbow Hospitals will get India's IPO season going again, with LIC in the pipeline.
Placement flows remained slow over the holiday shortened week. With only Taiwan and India seeing deals.


ECM Weekly (24th Apr 22) - Sk Shieldus, One Store, LIC, Campus, Rainbow, Zhihu, LG Energy, Shin Kong

APAC IPOs & Placements, Aequitas Research

Clarence Chu

APAC IPOs & Placements

WT Microelectronics / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/wt-microelectronics-co-ltd" target="_blank" data-smartkarma-citation="entities:19712:1" rel="noopener">WT Microelectronics (3036 TT)</a> is looking to raise approximately US$190m in its Primary GDS offering to repay foreign currency denominated debt and for procuring raw materials in foreign currencies. </li>
<li>While we can’t explicitly state that the deal is well-flagged, the firm has seen its gearing ratio increase and CFO was negative in its latest financial year.</li>
<li>In this note, we will talk about the deal dynamics and run the deal through our ECM framework.</li>
</ul>



WT Microelectronics (3036 TT) is looking to raise approximately US$190m in its Primary GDS offering to repay foreign currency denominated debt and for procuring raw materials in foreign currencies. 
While we can’t explicitly state that the deal is well-flagged, the firm has seen its gearing ratio increase and CFO was negative in its latest financial year.
In this note, we will talk about the deal dynamics and run the deal through our ECM framework.


WT Microelectronics Placement - Short Interest on the Rise, Could Lift the Debt Overhang

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.

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/wt-microelectronics-co-ltd" target="_blank" data-smartkarma-citation="entities:19712:1" rel="noopener">WT Microelectronics (3036 TT)</a> will offer S$1.93 in cash and a final FY2021 dividend (ex-div date: 28 April, payment date: 13 May) of S$0.088 for a total consideration of S$2.018.</li>
<li>The key scheme conditions are shareholder approval and Court approval. The scheme meeting will be held sometime in late June to early July.</li>
<li>The offer price represents a 10-year share price high. At the last close of S$1.96, the gross and annualised spread for a mid-Sep effective date is 3.0% and 7.1%, respectively.</li>
</ul>



WT Microelectronics (3036 TT) will offer S$1.93 in cash and a final FY2021 dividend (ex-div date: 28 April, payment date: 13 May) of S$0.088 for a total consideration of S$2.018.
The key scheme conditions are shareholder approval and Court approval. The scheme meeting will be held sometime in late June to early July.
The offer price represents a 10-year share price high. At the last close of S$1.96, the gross and annualised spread for a mid-Sep effective date is 3.0% and 7.1%, respectively.


Excelpoint’s Privatisation Offer from WT

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>
<a href="https://www.smartkarma.com/entities/wt-microelectronics-co-ltd" target="_blank" data-smartkarma-citation="entities:19712:1" rel="noopener"><strong>WT Microelectronics (3036 TT)</strong></a> has entered into an agreement to acquire electronic component distributor  <strong><a href="https://www.smartkarma.com/entities/excelpoint-technology-ltd" target="_blank" data-smartkarma-citation="entities:1774:1" rel="noopener">Excelpoint Technology (EXLP SP)</a></strong> by way of a Scheme at a cash consideration of S$1.93/share.</li>
<li>This is an Offer premium 7.8% to last close but a 21.4% premium prior to the announcement Excelpoint was in <a href="https://www.smartkarma.com/compose/insight/68454/WT%20Micro%E2%80%99s%20Offer%20For%20Excelpoint%20Tech%20Event-Driven%200%20Views%20,%2014%20Apr%202022%2010:17%20EXECUTIVE%20SUMMARY%20%20WT%20Microelectronics%20(3036%20TT)%20has%20entered%20into%20an%20agreement%20to%20acquire%20electronic%20component%20distributor%20%20Excelpoint%20Technology%20(EXLP%20SP)%20by%20way%20of%20a%20Scheme%20at%20a%20cash%20consideration%20of%20S%241.93/share.%20This%20is%20an%20Offer%20premium%207.8%%20to%20last%20close%20but%20a%2021.4%%20premium%20prior%20to%20the%20announcement%20Excelpoint%20was%20in%20discussions%20with%20a%20third%20party%20involving%20the%20company's%20shares.%20Albert%20Phuay%20(founder%20and%20CEO)%20will%20reinvest%20part%20of%20his%20cash%20consideration%20under%20the%20Scheme%20in%2020%%20equity%20of%20the%20Acquiring%20Entity,%20with%20the%20balance%2080%%20stake%20owned%20by%20WT.%20%20DETAIL%20%20The%20Offer%20WT%20Semiconductor%20is%20Offering%20S%241.93/share%20by%20way%20of%20a%20Scheme%20for%20all%20Excelpoint%20shareholders.%20A%20final%20dividend%20of%20S%240.088/share%20was%20announced%20on%2016%20February%202022%20-%20page%2019.%20For%20the%20avoidance%20of%20doubt,%20the%20Target%20Shareholders%20as%20at%20the%20Record%20Date%20(29%20April)%20will%20be%20entitled%20to%20receive%20and%20retain%20the%20Final%20FY2021%20Dividend%20in%20addition%20to%20the%20Scheme%20Consideration.%20The%20ex-date%20is%20the%2028%20April,%20and%20payment%20on%20the%2013%20May.%20%20Condition.%20Shareholder%20vote%20-%20this%20requires%20the%20approval%20of%20a%20majority%20of%20shareholders%20in%20number%20(headcount%20rule)%20representing%2075%%20in%20value%20of%20shares%20voted%20at%20a%20scheme%20meeting.%20See%20Quiddity%20Singapore%20M&amp;A%20Guide%202019%20for%20more%20info%20on%20Schemes%20in%20Singapore.%20%20Irrevocables.%20Irrevocable%20undertaking%20total%2050,513,372%20shares%20or%2041.98%%20of%20shares%20out.%20These%20irrevocables%20are%20from%20Albert%20Phuay%20Yong%20Hen%20(39.82%),%20Han%20Jiak%20Siew%20(2.02%%20-%20Phuay's%20wife),%20and%20AP21%20Holdings%20(0.14%),%20a%20vehicle%20controlled%20by%20Phuay.%20Switch%20Option.%20In%20the%20event%20of%20a%20competing%20offer,%20WT%20has%20the%20right,%20subject%20to%20prior%20consultation%20with%20the%20SIC,%20to%20proceed%20by%20way%20of%20a%20voluntary%20conditional%20cash%20offer.%20%20If%20the%20Switch%20Option%20is%20exercised,%20WT%20will%20make%20the%20Offer%20on%20the%20same%20or%20better%20terms%20as%20those%20which%20apply%20to%20the%20Scheme,%20and%20an%20acceptance%20condition%20set%20at%20only%20more%20than%2050%.%20MACs/Prescribed%20Occurrences.%20This%20includes%20no%20more%20than%20a%2010%%20decline%20in%20revenue%20or%20EBITDA%20-%20see%20pages%209-10.%20Anything%20else?%20The%20founder%20and%20CEO%20of%20Excelpoint,%20Albert%20Phuay,%20will%20reinvest%20part%20of%20the%20cash%20consideration%20due%20to%20him%20under%20the%20Scheme%20in%2020%%20equity%20of%20the%20%22Acquiring%20Entity%22,%20with%20the%20balance%2080%%20stake%20owned%20by%20WT.%20%20Albert%20Phuay%20will%20continue%20to%20be%20the%20CEO%20of%20Excelpoint.%20The%20Proposal%20Data%20Point%20Data%20in%20the%20Data%20Point%20The%20Deal%09Scheme%20Offeror%09WT%20Microelectronics%20(3036%20TT)%20%20Target%09Excelpoint%20Technology%20(EXLP%20SP)%20%20Terms%20%09%241.93/share,%20cash.%20Deal%20size:%20US%240.2bn.%20Conditions%09%20Scheme%20vote.%20SIC%20sign-off%20%20Dividends?%09%20Yes%20-%20S%240.088/share%20to%20be%20added.%20%20Source:%20Announcement%20On%20Pricing%20The%20Scheme%20Consideration%20also%20represents%20a%20premium%20of%2058.2%%20over%20the%20NAV%20%20as%20at%2031%20December%202021%20%20Source:%20Announcement%20%20Timetable%20Tentatively%20looking%20at%20an%20effective%20date%20in%20mid-September.%20%20Source:%20Announcement%20%20On%20Excelpoint%20%20Excelpointwas%20incorporated%20in%20Singapore%20on%2018%20May%202001%20and%20was%20listed%20on%20the%20Mainboard%20of%20the%20SGX-ST%20on%207%20January%202004%20at%20S%240.26/share.%20Excelpoint%20is%20a%20regional%20electronics%20component%20distributor%20in%20the%20Asia%20Pacific%20region.%20It%20offers%20electronic%20components,%20engineering%20design%20services,%20and%20supply%20chain%20management%20to%20original%20equipment%20manufacturers,%20original%20design%20manufacturers,%20and%20electronics%20manufacturing%20services.%20Excelpoint's%20suppliers%20include%20Analog%20Device%20(ADI),%20Microchip,%20Qorvo,%20Qualcomm,%20and%20Samsung,%20among%20others.%20The%20company%20now%20works%20closely%20with%20over%204,000%20customers.%20Recent%20Results.%20FY21%20revenue%20was%20up%2044.2%%20to%20US%241.6bn.%20Net%20profit%20increased%20137.2%%20to%20US%2424.5mn.%20%20The%20Board%20proposed%20an%20ordinary%20dividend%20of%20S%240.04/share%20and%20a%20special%20dividend%20of%20S%240.048/share,%20and%20was%20approved%20at%20the%20AGM.%20Abridged%20Fundamentals%20%20Shareholders%20%20Excelpoint%20placed%20out%20those%20shares%20to%20Alonim%20Investments%20on%20the%202%20September%202016%20at%20S%240.55/share.%20Alan%20Kwan%20is%20a%20director.%20I%20don't%20know%20why%20he%20hasn't%20given%20an%20irrevocable.%20Still,%20the%20Offer%20has%20board%20support.%20%20On%20WT%20%20WT%20was%20founded%20in%201993,%20and%20is%20one%20of%20the%20global%20leading%20distributors%20of%20semiconductor%20components.%20WT's%20FY21%20revenue%20was%20~US%2416bn.%20WT%20currently%20partners%20with%20over%2080%20suppliers%20across%20every%20major%20technology%20segment%20to%20serve%20over%208,000%20customers%20worldwide.%20Why%20The%20Deal?%20There%20are%20strong%20synergies%20between%20both%20companies:%20The%20enhanced%20complementary%20product%20line%20offerings%20will%20allow%20for%20business%20expansion.%20Most%20importantly,%20with%20the%20experienced%20teams%20and%20footprints%20from%20both%20companies,%20customers%20will%20benefit%20from%20the%20extensive%20product%20solutions%20and%20technical%20support%20provided%20by%20the%20WT%20group,%20allowing%20them%20earlier%20access%20to%20the%20market.%20%20In%20addition,%20the%20established%20customer%20bases%20combined%20would%20significantly%20improve%20the%20distribution%20capabilities%20and%20customer%20portfolios%20of%20WT%20in%20the%20Asia%20Pacific%20region.%20Cross%20selling%20of%20various%20products%20to%20the%20customers%20of%20Excelpoint%20and%20WT%20would%20not%20onlyrealise%20potential%20synergies%20for%20the%20enlarged%20WT%20group,%20but%20also%20bring%20more%20demand%20creation%20opportunities%20for%20the%20suppliers.%20%20Peer%20Comparison%20Excelpoint%20appears%20inexpensive%20versus%20peers.%20%20On%20a%20trailing%20EV/EBITDA%20basis,%20Excelpoiint%20has%20traded%20at%20a%209%%20discount%20to%20peers%20over%20the%20past%20three%20years.%20It%20is%20currently%2048%.%20Excelpoiint%20has%20traded%20at%20a%2020%%20discount%20to%20SGX%20peers%20over%20the%20past%20three%20years.%20It%20is%20currently%2044%.%20Excelpoint's%20average%20trailing%20EV/EBITDA%20over%20that%20time%20is%209.7x%20and%20it%20is%20currently%20at%206.2x.%20%20On%20a%20trailing%20PER%20basis,%20Excelpoiint%20has%20traded%20at%20a%2034%%20discount%20to%20peers%20over%20the%20past%20three%20years.%20It%20is%20currently%2040%.%20Excelpoiint%20has%20traded%20at%20a%2013%%20discount%20to%20SGX%20peers%20over%20the%20past%20three%20years.%20It%20is%20currently%2021%.%20Excelpoint's%20average%20trailing%20PER%20over%20that%20time%20is%2011.7x%20and%20it%20is%20currently%20at%206.5x.%20%20On%20a%20trailing%20P/B%20basis,%20Excelpoiint%20has%20traded%20at%20a%2025%%20discount%20to%20peers%20over%20the%20past%20three%20years.%20It%20is%20currently%20a%2069%%20premium.%20Excelpoiint%20has%20traded%20at%20a%2023%%20premium%20to%20SGX%20peers%20over%20the%20past%20three%20years.%20It%20is%20currently%20118%.%20Excelpoint's%20average%20trailing%20P/B%20over%20that%20time%20is%200.7x%20and%20it%20is%20currently%20at%201.5x.%20%20Share%20Price%20Performance%20Optically,%20this%20is%20a%20decade-high%20Offer%20price.%20%20%20Excelpoint%20has%20been%20a%20clear%20outperformer%20versus%20its%20peer%20group.%20%20%20Conclusions%20Last%20There%20appears%20enough%20here%20to%20get%20over%20the%20line.%20%20.%20%20The%20Trade:%20Trading%20at%20a%204.6%%20gross%20spread,%20including%20the%20dividend,%20which%20is%20paid%20this%20time%20next%20month.%20That%20looks%20attractive.%20Get%20involved,%20although%20this%20is%20not%20a%20super%20liquid%20arb%20situation." target="_blank" rel="noopener">discussions</a> with a third party involving the company's shares.</li>
<li>Albert Phuay (founder and CEO) will reinvest part of his cash consideration under the Scheme in 20% equity of the Acquiring Entity, with the balance 80% stake owned by WT. </li>
</ul>



WT Microelectronics (3036 TT) has entered into an agreement to acquire electronic component distributor  Excelpoint Technology (EXLP SP) by way of a Scheme at a cash consideration of S$1.93/share.
This is an Offer premium 7.8% to last close but a 21.4% premium prior to the announcement Excelpoint was in discussions with a third party involving the company's shares.
Albert Phuay (founder and CEO) will reinvest part of his cash consideration under the Scheme in 20% equity of the Acquiring Entity, with the balance 80% stake owned by WT. 


Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Quantitative Analysis

<div><p>Total short notional in Taiwan stocks is TWD 237,399 mm (~US$7.83 bn) as of 31 January 2020.</p></div><div><p>Over the Lunar New Year shortened two weeks, the largest short positions were put on in <a href="https://www.smartkarma.com/entities/chunghwa-telecom-co-ltd" target="_blank" rel="noopener" data-smartkarma-citation="entities:9181:1">Chunghwa Telecom (2412 TT)</a>, <a href="https://www.smartkarma.com/entities/mediatek-inc" target="_blank" rel="noopener" data-smartkarma-citation="entities:772:1">Mediatek Inc (2454 TT)</a>, <a href="https://www.smartkarma.com/entities/taiwan-semiconductor-manufacturing-company-tsmc" target="_blank" rel="noopener" data-smartkarma-citation="entities:11230:1">Taiwan Semiconductor Manufacturing Company (TSMC) (2330 TT)</a> and <a href="https://www.smartkarma.com/entities/largan-precision-co-ltd" target="_blank" rel="noopener" data-smartkarma-citation="entities:9126:1">Largan Precision (3008 TT)</a> while shorts were covered in <a href="https://www.smartkarma.com/entities/innolux-corp" target="_blank" rel="noopener" data-smartkarma-citation="entities:4509:1">Innolux Corp (3481 TT)</a>, <a href="https://www.smartkarma.com/entities/compeq-manufacturing-co-ltd" target="_blank" rel="noopener" data-smartkarma-citation="entities:9306:1">Compeq Manufacturing (2313 TT)</a>, <a href="https://www.smartkarma.com/entities/genius-electronic-optical-co-ltd" target="_blank" rel="noopener" data-smartkarma-citation="entities:9632:1">Genius Electronic Optical (3406 TT)</a> and <a href="https://www.smartkarma.com/entities/richwave-technology-corp" target="_blank" rel="noopener" data-smartkarma-citation="entities:18629:1">Richwave Technology (4968 TT)</a>.</p></div><div><p>We take a look at stocks that have seen the biggest percentage increase and decrease in short notional over the last two weeks and have short notional of at least US$5m. </p></div>

Total short notional in Taiwan stocks is TWD 237,399 mm (~US$7.83 bn) as of 31 January 2020.Over the Lunar New Year shortened two weeks, the largest short positions were put on in Chunghwa Telecom (2412 TT), Mediatek Inc (2454 TT), Taiwan Semiconductor Manufacturing Company (TSMC) (2330 TT) and Largan Precision (3008 TT) while shorts were covered in Innolux Corp (3481 TT), Compeq Manufacturing (2313 TT), Genius Electronic Optical (3406 TT) and Richwave Technology (4968 TT).We take a look at stocks that have seen the biggest percentage increase and decrease in short notional over the last two weeks and have short notional of at least US$5m. 

Taiwan - Shorts Cover Tech; Increase Positions in Telecom, Banks, Transportation

Taiwan

WT Microelectronics Co., Ltd. develops and markets integrated circuits (IC) products.  The Company's products include linear IC, applied IC, admixture semaphore IC, logic IC, image detecting IC, and memory IC.  Wintech acts as an agent for Texas Instruments, Fairchild, ST Microelectronics, Marvell, Wolfson, and Bowoon.

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WT Microelectronics (3036 TT)

ECM Weekly (24th Apr 22) - Sk Shieldus, One Store, LIC, Campus, Rainbow, Zhihu, LG Energy, Shin Kong

Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.

Sumeet Singh

WT Microelectronics Placement - Short Interest on the Rise, Could Lift the Debt Overhang

WT Microelectronics (3036 TT) is looking to raise approximately US$190m in its Primary GDS offering to repay foreign currency denominated debt and...

Clarence Chu

Excelpoint’s Privatisation Offer from WT

WT will offer S$1.93 in cash and a final FY2021 dividend of S$0.088 for a total consideration of S$2.018. At the last close of S$1.96, the...

Arun George

WT Micro's Offer For Excelpoint Tech

Trading at a 4.6% gross spread, including the dividend, which is paid this time next month. That looks attractive. Get involved, although this is...

David Blennerhassett

Taiwan - Shorts Cover Tech; Increase Positions in Telecom, Banks, Transportation

Total short notional in Taiwan stocks is TWD 237,399 mm (~US$7.83 bn) as of 31 January 2020.Over the Lunar New Year shortened two weeks, the...

Brian Freitas

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