ECM Daily Briefs | Page 18 of 127

In today’s briefing:

ECM Weekly (3rd June 2024) – Shift Up, QuantumPharm, Telix, Sompo, ASMedia, Exedy, Barito, Zomato

ECM Weekly (3rd June 2024) – Shift Up, QuantumPharm, Telix, Sompo, ASMedia, Exedy, Barito, Zomato

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 IPO front, we undertook a peer comparison and looked at valuations for Shift Up (462870 KS).
On the placement front, it was another busy week with a number of blocks in India along with Asmedia Technology (5269 TT)‘s GDR offering and Exedy Corp (7278 JP).

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Jun 01

Daily Brief ECM: Bloks Group Pre-IPO Tearsheet and more

In today’s briefing:

Bloks Group Pre-IPO Tearsheet
CaiNiao Q4FY Results: After IPO Withdrawn, Margins Fell | Retention Payments, or Something Else?
Jiangxi Rimag IPO (2522.HK): Global Offering and Valuation Update

Bloks Group Pre-IPO Tearsheet

Bloks Group (1850960D CH) is looking to raise US$300m in its upcoming Hong Kong IPO. The bookrunners on the deal are Goldman Sachs, and Huatai International.
Bloks Groups (Bloks) operates in the toy segment where it primarily assembles character toys. Its portfolio contains both self-developed and renowned licensed intellectual property (IPs).
According to F&S, Bloks was China’s largest player in the assembly character toy segment with an approximate gross merchandise value (GMV) of RMB1.8bn in 2023.

CaiNiao Q4FY Results: After IPO Withdrawn, Margins Fell | Retention Payments, or Something Else?

By Daniel Hellberg

After CaiNiao halted IPO in late March, company reported lower Q4 margins
What drove Q4 margin deterioration, retention payments or weaker X-border?
With IPO off the table, supporting AliExpress becomes CaiNiao’s main role

Jiangxi Rimag IPO (2522.HK): Global Offering and Valuation Update

By Andrei Zakharov

Jiangxi Rimag Group, a China-based medical imaging center operator and provider of Rimag cloud services, set terms for an IPO and plans to raise ~HK$280M (~$36M) in Hong Kong.
The IPO is expected to be between HK$14.60 and HK$16.80. At the midpoint of the range, Jiangxi Rimag will have a market value of ~HK$5.6B based on 356.3M outstanding shares.
CITIC Securities is leading the offering. CMB International and Huatai International act as joint global coordinators, joint bookrunners and joint lead managers.

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May 31

Daily Brief ECM: Shift Up IPO: Valuation Insights and more

In today’s briefing:

Shift Up IPO: Valuation Insights
AMMB Holdings Placement – Last Selldown Did Well, This One Will Remove the Overhang

Shift Up IPO: Valuation Insights

By Arun George

Shift Up (462870 KS) is Korea’s leading game development studio. It is seeking to raise up to US$320 million.
We previously discussed the IPO in Shift Up IPO: The Investment Case.
We examine the syndicate’s valuation methodology. Our analysis suggests that Shift Up is attractively valued in the IPO price range. We would participate in the IPO.

AMMB Holdings Placement – Last Selldown Did Well, This One Will Remove the Overhang

ANZ Funds is looking to raise around US$149m from selling its remaining stake in AMMB Holdings (AMM MK).
ANZ has sold the majority of its stake in AMMB earlier in Mar 2024. Coming to markets again to sell its remaining stake, the deal here should be well flagged.
In this note, we run the deal through our ECM framework and comment on deal dynamics.

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May 30

Daily Brief ECM: Quantgroup Technology Pre-IPO Tearsheet and more

In today’s briefing:

Quantgroup Technology Pre-IPO Tearsheet
QuantumPharm (Xtalpi) Pre-IPO – PHIP Updates – Strong Growth, Although Losses Continue to Pile Up
Pre-IPO Mokingran Jewellery Group – Disappointing Profit Margin and Potential Risk in Business Model
Waystar Holding: IPO Price (Midpoint): $21.50. PT: $17.50, ~19% Downside. Move To Sidelines

Quantgroup Technology Pre-IPO Tearsheet

By Ethan Aw

Quantgroup Technology (1467534D CH) is looking to raise up to US$200m in its upcoming HK IPO. The deal will be run by CICC and CMB International.
Quantgroup Technology is a digitalization solutions provider in China. Its digitalization solutions primarily include digitalized marketing, including precision marketing for financial institutions and local merchants, and goods transaction facilitation.
The apps that Quantgroup operates can be largely categorized into two Quant-enabled proprietary apps, namely Yangxiaomie and Consumption Guide.

QuantumPharm (Xtalpi) Pre-IPO – PHIP Updates – Strong Growth, Although Losses Continue to Pile Up

QuantumPharm (QUP HK) (Xtalpi) is looking to raise US$200m in its upcoming Hong Kong IPO.
QuantumPharm is a R&D platform, utilizing quantum physics-based first-principles calculation, advanced AI, high-performance cloud computing, and scalable and standardized robotic automation to provide drug and material science R&D solutions.
In our previous note we looked at the company’s past performance. In this note, we discuss QuantumPharm’s PHIP updates.

Pre-IPO Mokingran Jewellery Group – Disappointing Profit Margin and Potential Risk in Business Model

By Xinyao (Criss) Wang

MOKINGRAN’s revenue fluctuated in the past three years. Profit margin was much lower than that of peers/industry average, which may not necessarily have big improvement even with upward gold price.
MOKINGRAN once applied for IPO in A-share but failed. The concerns of SZSE included “unusual” gold trade-in business, large inventory balance and the risk of “false increase” in profits/revenues.
The gold boom should not mask the risks of MOKINGRAN. Even if MOKINGRAN successfully goes public, it still faces many challenges. Valuation of MOKINGRAN should be lower than peers.

Waystar Holding: IPO Price (Midpoint): $21.50. PT: $17.50, ~19% Downside. Move To Sidelines

By Andrei Zakharov

Waystar Holding, provider of mission-critical cloud software to healthcare organizations, set terms for an IPO and plans to raise ~$970M in the upcoming Nasdaq offering.
The initial public offering is expected to be between $20.00 and $23.00. At the midpoint, Waystar Holding has a market value of ~$3.7B based on 173.4M fully diluted shares.
In my insight, I discuss valuation framework for comparable company analysis and research multiples of M&A transactions, including Athenahealth, Cerner and Change Healthcare.

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May 29

Daily Brief ECM: ASMedia GDR Offering – Well Flagged and more

In today’s briefing:

ASMedia GDR Offering – Well Flagged, and Momentum Has Been Strong Leading into the Offering
Shift Up IPO: The Investment Case
Shift Up IPO – Thoughts on Valuations – Bear/Base/Bull
Pre-IPO Jiangxi Rimag Group (PHIP Updates) – Some Points Worth the Attention

ASMedia GDR Offering – Well Flagged, and Momentum Has Been Strong Leading into the Offering

Asmedia Technology (5269 TT) is looking to raise up to US$335m in its global depository receipts (GDRs) offering.
Overall, the deal would be a relatively small one for the stock to digest at just 5.6 days of its three month ADV.
In this note, we run the deal through our ECM framework and comment on deal dynamics.

Shift Up IPO: The Investment Case

By Arun George

Shift Up (462870 KS) is Korea’s leading game development studio. It is seeking to raise up to US$320 million.
Shift Up now focuses only on game development and has a policy of publishing games in cooperation with global partners such as Tencent (700 HK) and Sony Corp (6758 JP).
The investment case rests on a stellar game development track record, several growth drivers, high profitability and cash generation.

Shift Up IPO – Thoughts on Valuations – Bear/Base/Bull

Shift Up (462870 KS) plans to raise up to US$320m in its South Korean IPO.
Shift Up is a South Korean games developer, which as released three games so far for the global markets.
We have looked at the company’s performance in our past notes. In this note, we talk about valuations.

Pre-IPO Jiangxi Rimag Group (PHIP Updates) – Some Points Worth the Attention

By Xinyao (Criss) Wang

Considering the dominant position of medical imaging centers in public hospitals and challenges from other players, future development space of Rimag would be squeezed,and even will soon encounter growth bottlenecks.
Although Rimag turned losses into profits, we still have doubts about its future profitability due to increasing costs and potential price decline.This business may fail to bring investors decent profits.
Rimag’s post-investment valuation after last round financing isn’t cheap.Given the uncertainty of future revenue growth prospects and the real market space, P/S of below 3 is a more comfortable range.

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May 28

Daily Brief ECM: Alibaba/JD.com: Thoughts On The Recent Convertible Bond Issuance and more

In today’s briefing:

Alibaba/JD.com: Thoughts On The Recent Convertible Bond Issuance
Exedy Corporation Placement – Relatively Large One, Although Buyback Should Aid Share Price
Barito Renewables Lockup Expiry – US$8bn Lockup Expiry for Largest Indonesian Market Cap Stock
Lalatech Compared to Full Truck Alliance, SF Intra-City, and GOGOX in Eleven Easy Charts
Telix Pharmaceutical US ADS – Past Deal Record Hasn’t Been Strong, but Fortune Could Be Turning
Shift Up IPO – Peer Comparison – Small in Size but Ranks High on Growth and Margins

Alibaba/JD.com: Thoughts On The Recent Convertible Bond Issuance

By Steve Zhou, CFA

Alibaba Group Holding (9988 HK) and JD.com (9618 HK) both announced the issuance of convertible debt last week (Alibaba on May 23 and JD.com on May 21).
Both have mentioned that the reasons for the issuance are the low funding cost (0.25% coupon for JD.com and 0.5% for Alibaba) and to fund their current share repurchase program.
I think the convertible debt structures makes sense and it is beneficial for both companies to buy back as much as possible at the current share price.

Exedy Corporation Placement – Relatively Large One, Although Buyback Should Aid Share Price

Aisin (7259 JP) is looking to raise US$290m from selling its entire stake in Exedy Corp (7278 JP).
While the selldown doesn’t seem to be particularly well-flagged, this appears to be another cross-shareholder unwind in Japan.
In this note, we will talk about the placement and run the deal through our ECM framework.

Barito Renewables Lockup Expiry – US$8bn Lockup Expiry for Largest Indonesian Market Cap Stock

By Ethan Aw

Barito Renewables Energy (BREN IJ) raised around US$200m in its Indonesian IPO, after pricing at the top end at IDR780/share. Its eight-month lockup will expire on 29th May 2024.
Barito Renewables (BR) is Indonesia’s largest geothermal power producer, and the third-largest globally by installed capacity, as per the firm.
In this note, we will talk about the lock-up dynamics and updates since our last note.

Lalatech Compared to Full Truck Alliance, SF Intra-City, and GOGOX in Eleven Easy Charts

By Daniel Hellberg

We compare Lalatech’s scale, P&L, Balance Sheet, and Cash Flow to peers
On several measures, Lalatech is comparable to Full Truck Alliance, SF-Intra
Small, unprofitable GOGOX not an appropriate comp for Lalatech, in our view

Telix Pharmaceutical US ADS – Past Deal Record Hasn’t Been Strong, but Fortune Could Be Turning

Telix Pharmaceuticals (TLX AU) aims to raise at least US$100m in its US ADS listing. The bookrunners on the deal are Jefferies, Morgan Stanley, Truist Securities, and William Blair.
TLX is a commercial-stage biopharmaceutical company focused on the development and commercialization of therapeutic and diagnostic radiopharmaceuticals.
In this note, we talk about the deal dynamics and the listing impact.

Shift Up IPO – Peer Comparison – Small in Size but Ranks High on Growth and Margins

Shift Up (462870 KS) plans to raise up to US$320m in its upcoming South Korean IPO.
Shift Up is a South Korean games developer, which as released three games so far for the global markets.
In our previous note, we looked at the company’s past performance. In this note, we will undertake a peer comparison.

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May 27

Daily Brief ECM: Hoshino Resorts REIT Placement – Another Raising to Fund an Accretive Acquisition and more

In today’s briefing:

Hoshino Resorts REIT Placement – Another Raising to Fund an Accretive Acquisition
ECM Weekly (27th May 2024) – Renesas, AUB, Modec, Tata Tech, MUFG, Shift Up, Novelis, Shulan
Jiangxi Rimag IPO: FCF Generation and Margin Expansion. Expect ~30 New Imaging Centers By 2026

Hoshino Resorts REIT Placement – Another Raising to Fund an Accretive Acquisition

Hoshino Resorts Reit (3287 JP) is looking to raise US$125m from a primary follow-on. Proceeds will be used to acquire the OMO7 Osaka asset.
The REIT has been active on the acquisition front, undertaking a number of capital raisings in recent years.
In this note, we will talk about the placement and run the deal through our ECM framework.

ECM Weekly (27th May 2024) – Renesas, AUB, Modec, Tata Tech, MUFG, Shift Up, Novelis, Shulan

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 IPO front, Go Digit managed to do well despite somewhat tepid subscription rates, while Shift Up (462870 KS) was looking to be the next hot listing in Korea.
On the placement front, Renesas Electronics (6723 JP) mega-block kept the cross-shareholding unwind going.

Jiangxi Rimag IPO: FCF Generation and Margin Expansion. Expect ~30 New Imaging Centers By 2026

By Andrei Zakharov

Jiangxi Rimag Group, China’s largest medical group with focus on medical imaging services, updated its PHIP and may enter the public market in June.
Terms of an IPO have not yet been set. The expected price range and the size of the offering were not disclosed in the company’s filings.
I’m positive on Jiangxi Rimag Group given the fast-growing TAM: third-party medical imaging center market accounts only for ~1% of the PRC medical imaging service market today.

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May 26

Daily Brief ECM: Weekly Deals Digest (26 May) – Henlius and more

In today’s briefing:

Weekly Deals Digest (26 May) – Henlius, HKTV, SciClone, KFC, Best World, PropertyGuru, Modec

Weekly Deals Digest (26 May) – Henlius, HKTV, SciClone, KFC, Best World, PropertyGuru, Modec

By Arun George

A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
ECM developments: Modec Inc (6269 JP) prices its US$535 million secondary offering.
Event-Driven developments: Shanghai Henlius Biotech (2696 HK), Hong Kong Television Network (1137 HK). Sciclone Pharmaceuticals (6600 HK), Kfc Holdings Japan (9873 JP), Best World International (BEST SP), PropertyGuru (PGRU US).

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May 24

Daily Brief ECM: Shift Up IPO – The Positives – All Games Have Done Well and more

In today’s briefing:

Shift Up IPO – The Positives – All Games Have Done Well
Shift Up IPO – The Negatives – Changing Monetisation Model, Censorship Issues
Allied Blenders and Distillers Pre-IPO – Refiling Updates and Initial Thoughts on Valuation

Shift Up IPO – The Positives – All Games Have Done Well

Shift Up plans to raise up to US$320m in its upcoming South Korean IPO.
Shift Up is a South Korean games developer, which as released three games so far for the global markets.
In this note, we talk about the positive aspects of the deal.

Shift Up IPO – The Negatives – Changing Monetisation Model, Censorship Issues

Shift Up (462870 KS) plans to raise up to US$320m in its upcoming South Korean IPO.
Shift Up is a South Korean games developer, which as released three games so far for the global markets.
In this note, we talk about the not-so-positive aspects of the deal.

Allied Blenders and Distillers Pre-IPO – Refiling Updates and Initial Thoughts on Valuation

By Ethan Aw

Allied Blenders & Distillers (9844250Z IN) is looking to raise about US$180m in its upcoming India IPO.
ABD is the largest Indian-owned Indian-made foreign liquor (IMFL) company and the third largest IMFL company in India, in terms of annual sales volumes between FY14 and FY22.
In this note, we provide a summary of its refiling updates, undertake a quick peer comparison and share our initial thoughts on valuation.

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May 23

Daily Brief ECM: Go Digit IPO Trading – Low Subscription Rate and more

In today’s briefing:

Go Digit IPO Trading – Low Subscription Rate, Not All Shares Are Locked Up
Shift Up IPO Valuation Analysis
Pre-IPO Shanghai Cell Therapy Group – Commercialization Prospects and Profitability Are Pessimistic

Go Digit IPO Trading – Low Subscription Rate, Not All Shares Are Locked Up