APAC IPOs & Placements, Aequitas Research

Clarence Chu

APAC 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

<ul>
<li>
<a href="https://www.smartkarma.com/entities/mixue-group-bab2ff71-b80e-406a-8746-77d70acaa16e" target="_blank" data-smartkarma-citation="entities:40625:1" rel="noopener">MIXUE Group (1860056D CH)</a> is looking to raise about US$1bn in its upcoming Hong Kong IPO. The bookrunners on the deal are Bank of America, Goldman Sachs, and UBS.</li>
<li>MIXUE Group (MIXUE) is a freshly-made drinks company providing affordable products to consumers, including freshly-made fruit drinks, tea, ice cream and coffee, typically priced at around one USD per item.</li>
<li>The firm is the largest domestically freshly-made drinks company in terms of number of stores as of Sept 23, and number of cups sold during 9M23, according to CIC.</li>
</ul>



MIXUE Group (1860056D CH) is looking to raise about US$1bn in its upcoming Hong Kong IPO. The bookrunners on the deal are Bank of America, Goldman Sachs, and UBS.
MIXUE Group (MIXUE) is a freshly-made drinks company providing affordable products to consumers, including freshly-made fruit drinks, tea, ice cream and coffee, typically priced at around one USD per item.
The firm is the largest domestically freshly-made drinks company in terms of number of stores as of Sept 23, and number of cups sold during 9M23, according to CIC.


Greater China Equity Long/Short Analyst

Eric Chen

Equity Bottom-Up

<ul>
<li>We believe the company is well positioned in China's rapidly growing pizza market thanks to its strong brand and superior store economics. </li>
<li>Despite stock rally post 1H23 results, market still underestimates its earnings for both near and long term. We expect RMB250 million net profit for 2024 versus break-even by consensus.  </li>
<li>History suggests DPC Dash has recipe for attractive stock return driven by its highly visible growth that can shield it from macro situations, which is desperately needed by China investors.  </li>
</ul>


We believe the company is well positioned in China's rapidly growing pizza market thanks to its strong brand and superior store economics. 
Despite stock rally post 1H23 results, market still underestimates its earnings for both near and long term. We expect RMB250 million net profit for 2024 versus break-even by consensus.  
History suggests DPC Dash has recipe for attractive stock return driven by its highly visible growth that can shield it from macro situations, which is desperately needed by China investors.  


DPC Dash (1405 HK): Recipe for Multibagger

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Guoquan Food (Shanghai) / Equity Capital Markets

<ul>
<li>Guoquan’s model is easy to replicate.The so-called “moat” is all based on scale effects, without which Guoquan would lose competitiveness.This is why Guoquan has been striving to expand franchised stores.</li>
<li>With the increasing frequency of people dining out after China reopens, the high-speed expansion in 2020 seems unsustainable. To B model has less growth space/potential than To C model.</li>
<li>In such a fiercely competitive market, Guoquan's long-term development logic is not solid. The current temporary improvement in financial performance is likely to be a flash in the pan.</li>
</ul>


Guoquan’s model is easy to replicate.The so-called “moat” is all based on scale effects, without which Guoquan would lose competitiveness.This is why Guoquan has been striving to expand franchised stores.
With the increasing frequency of people dining out after China reopens, the high-speed expansion in 2020 seems unsustainable. To B model has less growth space/potential than To C model.
In such a fiercely competitive market, Guoquan's long-term development logic is not solid. The current temporary improvement in financial performance is likely to be a flash in the pan.


Pre-IPO Guoquan Food (Shanghai) - High Growth May Not Be Sustainable; Long Logic Doesn't Hold Water

External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

<ul><li>YTD 2023 performance of XBXB and Cou Cou were far below expectation, evidenced by weak SSS recovery rate and margins.</li><li>Just because of its cheap valuation, we maintain BUY and cut TP to HK$ 4.89, based on 15x FY24E P/E.</li><li>1H23 results inline, but demand is still weak. G</li></ul><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

YTD 2023 performance of XBXB and Cou Cou were far below expectation, evidenced by weak SSS recovery rate and margins.Just because of its cheap valuation, we maintain BUY and cut TP to HK$ 4.89, based on 15x FY24E P/E.1H23 results inline, but demand is still weak. GContent is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Xiabu Xiabu (520 HK) – More Time Is Needed to Reform and Recover

Haidilao International Holding / Equity Bottom-Up

<ul>
<li>Positive profit alerts from both Jiumaojiu and Haidilao reflect strong gain in operating efficiency but also point to looming growth deceleration as brands mature.</li>
<li>We see valuation more reasonable due to a combination of sector de-rating in 1H23 and higher visibility into earnings recovery post these profit alerts.</li>
<li>Yum China remains best long-term play in China catering sector in our view. While both Haidilao and Xiabuxiabu present trading opportunity, we are still cautious about Jiumaojiu.</li>
</ul>


Positive profit alerts from both Jiumaojiu and Haidilao reflect strong gain in operating efficiency but also point to looming growth deceleration as brands mature.
We see valuation more reasonable due to a combination of sector de-rating in 1H23 and higher visibility into earnings recovery post these profit alerts.
Yum China remains best long-term play in China catering sector in our view. While both Haidilao and Xiabuxiabu present trading opportunity, we are still cautious about Jiumaojiu.


China Catering Sector: Positioning for Interim Results

China

Xiabuxiabu Catering Management China Holdings Co Ltd  owns and operates a chain of restaurants in China. The company allows customers to choose from a selection of vegetables, meats, and seafood to cook in their own individual hot pot in its restaurants.

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Xiabuxiabu Catering (520 HK)

MIXUE Group Pre-IPO Tearsheet

MIXUE Group (1860056D CH) is looking to raise about US$1bn in its upcoming Hong Kong IPO. The bookrunners on the deal are Bank of America, Goldman...

Clarence Chu

DPC Dash (1405 HK): Recipe for Multibagger

We believe the company has the right recipe to become another multibagger in China's catering sector thanks to its strong brand and superior store...

Eric Chen

Pre-IPO Guoquan Food (Shanghai) - High Growth May Not Be Sustainable; Long Logic Doesn't Hold Water

Guoquan's franchise model doesn't have high moat.Scale effect is fading after people change eating habits/cut back on spending. Previous high...

Xinyao (Criss) Wang

Xiabu Xiabu (520 HK) – More Time Is Needed to Reform and Recover

YTD 2023 performance of XBXB and Cou Cou were far below expectation, evidenced by weak SSS recovery rate and margins. Just because of its cheap...

CMB International

China Catering Sector: Positioning for Interim Results

Positive profit alerts from both Jiumaojiu and Haidilao highlights both efficiency improvement and growth concerns. We discuss our thoughts about...

Eric Chen

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