ECM Daily Briefs | Page 19 of 118

In today’s briefing:

Thai Credit Bank IPO Trading – Half the Deal Already Spoken For, the Other Half Should Be Liquid
Agilus Diagnostics Limited Pre-IPO – Still Recovering from COVID
SBFC Finance Lockup Expiry – Time to Cash in on Some Hefty Profits
Entero Healthcare IPO – Profitability Not Out of the Woods Yet

Thai Credit Bank IPO Trading – Half the Deal Already Spoken For, the Other Half Should Be Liquid

Thai Credit Bank PCL (3674238Z TB) raised around US$281m in its Thailand IPO.
TCB is a commercial bank that focuses on providing business loans to small and medium-size enterprises (SMEs), nano loans and micro credits to merchants, and home loans for individual customers.
We had looked at the firm’s past performance and shared our thoughts on TCB’s valuation in earlier notes. In this note, we will look at the trading dynamics.

Agilus Diagnostics Limited Pre-IPO – Still Recovering from COVID

Agilus Diagnostics Limited (SRLL IN) is looking to raise around US$200m in its upcoming India IPO.
Agilus Diagnostics Limited (Agilus) is a diagnostic testing service provider.
In this note, we look at the company’s past performance.

SBFC Finance Lockup Expiry – Time to Cash in on Some Hefty Profits

By Ethan Aw

SBFC Finance Limited (SBFC IN) raised around US$131m in its India IPO, after the deal was priced at INR57/share. Its six-month lockup will expire on 12th Feb 2024.
SBFC Finance is a systematically important, non-deposit taking non-banking finance company (NBFC-ND-SI), offering secured MSME Loans and Loans against Gold.
In this note, we will talk about the lock-up dynamics and updates since our last note.

Entero Healthcare IPO – Profitability Not Out of the Woods Yet

Entero Healthcare Solutions Limited (2294842D IN) is looking to raise US$193m in its India IPO.
Entero Healthcare Solutions (Entero) is a healthcare products distributor in India.
In this note, we will look at the RHP updates, undertake a peer comparison, and share our thoughts on valuation.

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Feb 08

Daily Brief ECM: Digital Core REIT Placement – Taking a Turn for the Better After All the Negative News and more

In today’s briefing:

Digital Core REIT Placement – Taking a Turn for the Better After All the Negative News
CaiNiao’s FYQ3: Solid Revenue Growth & EBITA Margin Improvement Distinguish It From Express Peers

Digital Core REIT Placement – Taking a Turn for the Better After All the Negative News

By Ethan Aw

Digital Core REIT (DCREIT SP) is looking to raise at least US$100m in its primary placement. The proceeds will be used to fund potential acquisitions and debt repayment.
The deal will be a large one to digest at 72.7 days of three month ADV and 12.8% dilution.
In this note, we’ll run the deal through our ECM framework and comment on deal dynamics.

CaiNiao’s FYQ3: Solid Revenue Growth & EBITA Margin Improvement Distinguish It From Express Peers

By Daniel Hellberg

CaiNiao’s revenue growth remained strong, up +24% Y/Y in December quarter
EBITA turned positive from loss in prior year period, but margin < FYQ2
Overall, an impressive set of results that distinguishes CaiNiao from express peers

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Feb 07

Daily Brief ECM: Kayou Pre-IPO Tearsheet and more

In today’s briefing:

Kayou Pre-IPO Tearsheet
Samhyun IPO Valuation Analysis
Pre-IPO Xiaocaiyuan International Holding – A “Dark Horse” In Mass Chinese Cuisine Market

Kayou Pre-IPO Tearsheet

By Ethan Aw

Kayou (000KAYOU CH) is looking to raise up to US$500m in its upcoming HK IPO. The deal will be run by CICC, Morgan Stanley and JP Morgan.
Kayou is a Chinese pan-entertainment product retailer of toys, with trading cards in particular as its core product.
As of 9M23 (30th Sep 23), it had an IP matrix of 44 IPs through licensing from IP partners and the development of proprietary IPs.

Samhyun IPO Valuation Analysis

Our base case valuation of Samhyun is target price of 28,106 won, which is 25% higher than the mid-point of the IPO price range (22,500 won).
Given the moderate upside, we have a Positive view of Samhyun IPO. Our base case valuation is based on P/E of 34.6x net profit of 8.6 billion won in 2023.
Samhyun developed one of the world’s first CVVD (Continuously Variable Valve Duration) technology for automobile engines, which improves fuel efficiency by controlling the engine’s valve opening time.

Pre-IPO Xiaocaiyuan International Holding – A “Dark Horse” In Mass Chinese Cuisine Market

By Xinyao (Criss) Wang

Based on effective strategic positioning, Xiaocaiyuan is able to seize the market’s demand for cost-effective catering during consumption downgrade and the trend of increasing restaurant chain rate in China.
The key for Xiaocaiyuan to generate increasing profits at low spending-per-consumer is due to its strong supply chain, which will be favored by capital especially when Xiaocaiyuan enters community catering.
Xiaocaiyuan International Holding (XCY HK) is better than peers. However, due to poor sentiment in HKEX, it’s not sure if Xiaocaiyuan’s valuation/share price performance could outperform peers as well.

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Jan 24

Daily Brief ECM: Pre-IPO Shouhui Tech – The Business Outlook and Stock Price Performance Are Not Optimistic and more

In today’s briefing:

Pre-IPO Shouhui Tech – The Business Outlook and Stock Price Performance Are Not Optimistic
Guming Holdings (Goodme) Pre-IPO – The Negatives – Growth Sustainability Remains a Question Mark

Pre-IPO Shouhui Tech – The Business Outlook and Stock Price Performance Are Not Optimistic

By Xinyao (Criss) Wang

The essence of Shouhui’s business model is to “sell insurance” rather than provide services with technological attributes. So, Shouhui has relatively single business composition and lacks diversified sources of revenue.
The trend of “disintermediation” is becoming increasingly evident, which may lead to customers deciding to purchase insurance directly from insurance companies not from Shouhui, resulting declining demand for Shouhui’s services/products.
The business nature of insurance is incompatible with the Internet’s pursuit of rapid expansion. Cooling “Internet +insurance” investment in recent years proves the decline of market’s enthusiasm for this business.

Guming Holdings (Goodme) Pre-IPO – The Negatives – Growth Sustainability Remains a Question Mark

Guming Holdings (GUM HK) (Guming) is looking to raise US$300m in its upcoming Hong Kong IPO.
Guming Holdings (Guming) is a maker of freshly-made beverages in China.
In this note, we will talk about the not so positive aspects of the deal.

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Jan 23

Daily Brief ECM: Amer Sports (AS US) IPO: Valuation Insights and more

In today’s briefing:

Amer Sports (AS US) IPO: Valuation Insights
Amer Sports IPO Valuation Analysis
Guming Holdings (Goodme) Pre-IPO – The Positives – Benefited from Scaling Its Store Network

Amer Sports (AS US) IPO: Valuation Insights

By Arun George

Amer Sports (AS US) is a global iconic sports and outdoor brand group. Amer has launched an NYSE IPO to raise US$1.6-1.8 billion at a US$16.00 to US$18.00 price range.
We previously discussed the IPO in Amer Sports IPO: The Bull Case, Amer Sports IPO: The Bear Case and Amer Sports IPO: Valuation First-Look.
We revise our forecasts to reflect the FY23 preliminary estimates and long-term growth targets. Our valuation analysis suggests that Amer is fairly valued at the IPO price range.

Amer Sports IPO Valuation Analysis

Amer Sports announced it plans to raise up to $1.8 billion at $16 to $18 per share, targeting a valuation of up to $8.7 billion.
We estimate the company to generate revenue of $5.6 billion (up 23.5% YoY) and operating profit of $285.7 million (down 13.7% YoY) in 2024.
We would pass on this IPO due to lack of valuation merits, highly leveraged balance sheet, and inconsistent profit margins, despite its solid sales growth in the past several years.

Guming Holdings (Goodme) Pre-IPO – The Positives – Benefited from Scaling Its Store Network

Guming Holdings (GUM HK) (Guming) is looking to raise US$300m in its upcoming Hong Kong IPO.
Guming Holdings (Guming) is a maker of freshly-made beverages in China.
In this note, we will talk about the positive aspects of the deal.

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Jan 22

Daily Brief ECM: Medi Assist Healthcare IPO Trading – Decent Subscription Rates Although Valuation Appears Fair and more

In today’s briefing:

Medi Assist Healthcare IPO Trading – Decent Subscription Rates Although Valuation Appears Fair

Medi Assist Healthcare IPO Trading – Decent Subscription Rates Although Valuation Appears Fair

Medi Assist Healthcare Services (0886371D IN) raised around US$140m in its India IPO.
Medi Assist Healthcare Services (Medi Assist) provides third party administration services to insurance companies via its subsidiaries.
We have covered various aspects of the deal in our previous note. In this note, we will talk about the demand and trading dynamics.

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Jan 21

Daily Brief ECM: ECM Weekly (21st Jan 2024) – Mixue and more

In today’s briefing:

ECM Weekly (21st Jan 2024) – Mixue, Amer, Medi Assist, IPO Pipeline, Yamae, Alchip, NHPC, ASMedia

ECM Weekly (21st Jan 2024) – Mixue, Amer, Medi Assist, IPO Pipeline, Yamae, Alchip, NHPC, ASMedia

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 continued our coverage of Amer Sports (AS US) and looked at Mixue Group Hong Kong filings.
Placements continued to trickle in throught the week, across the region, apart from Hong Kong.

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Jan 20

Daily Brief ECM: ASMedia Placement – Momentum Has Been Strong and more

In today’s briefing:

ASMedia Placement – Momentum Has Been Strong, but an Overhang Exists

ASMedia Placement – Momentum Has Been Strong, but an Overhang Exists

WT Microelectronics (3036 TT) is looking to raise US$256m from selling half of its stake in Asmedia Technology (5269 TT).
The deal wouldn’t be a very large one to process at just 3.4 days of ASMedia’s ADV.
Although, the selldown doesn’t appear to be particularly well flagged. The remaining WT Microelectronics’ stake will also create an overhang on ASMedia’s share price as well.

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Jan 19

Daily Brief ECM: Why Is APR IPO Getting Delayed? and more

In today’s briefing:

Why Is APR IPO Getting Delayed?
Amer Sports IPO Preview
Aequitas 2024 Asia IPO Pipeline – ASEAN and ANZ
NHPC OFS – While the Overhang Remains, Momentum on the Stock Has Been Very Strong

Why Is APR IPO Getting Delayed?

APR announced it will delay its IPO. Now, APR’s book building has been postponed to 2 to 8 February. The IPO price range remains the same.
The company has provided updated preliminary sales and operating profits for 2023 in the revised IPO prospectus. Revenue was a bit light but OP was better than expected in 4Q23.
Our base case valuation of APR is 370,809 won per share which represents an 85% upside from the high end of the bankers’ valuation range (200,000 won).

Amer Sports IPO Preview

The biggest risk for Amer Sports is its excessive leverage. It had net debt of $5.9 billion and equity of only $8.8 million at the end of 3Q 2023.
Many investors are likely to emphasize the negatives more (especially the excessive leverage and inconsistent operating margins), rather than the positives such as China representing increasing percentage of total sales.
Amer Sports is trying to raise nearly $1 billion in this IPO which could value the company at about $10 billion.

Aequitas 2024 Asia IPO Pipeline – ASEAN and ANZ

In this note, we will look at the Asia Pacific IPO pipeline for 2024, following up with ASEAN and ANZ after having looked at other regions earlier.
This list has been compiled on a best effort basis from tracking the company filings and through various other sources
The deals you see in this note are only a part of our full IPO pipeline tracker. Feel free to drop us a message for additional information on these IPOs.

NHPC OFS – While the Overhang Remains, Momentum on the Stock Has Been Very Strong

The GoI is looking to raise US$199m in trimming a portion of its stake in NHPC (NHPC IN). There is an upsize option to increase the deal size to US$279m.
Assuming that the deal upsizes, the deal here would be a relatively large one to digest at 11 days of the stock’s ADV.
The deal appears to be well flagged, with the selldown by the GoI appearing to be part of its divestment drive across PSUs in India.

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Jan 18

Daily Brief ECM: Yamae Group Placement – Would Result in a Large Dilution and more

In today’s briefing:

Yamae Group Placement – Would Result in a Large Dilution, Although Its Momentum Has Been Strong
MIXUE Group Pre-IPO – The Positives – Leading by a Mile
MIXUE Group Pre-IPO – The Negatives – Declining GMV Share
Pre-IPO Guming Holdings – The Current Market Position Is Not Secure

Yamae Group Placement – Would Result in a Large Dilution, Although Its Momentum Has Been Strong

Yamae Group Holdings (7130 JP) is looking to raise US$115m from a primary follow-on. As per the firm, proceeds will be used to pay down its acquisition-linked debt.
We would argue that the deal is somewhat well flagged given the firm’s track record of acquisitions, with the most recent being Confex Holdings.
That being said, the deal would result in a large dilution for the firm, and would be a large one to digest at 48 days of Yamae’s three month ADV.

MIXUE Group Pre-IPO – The Positives – Leading by a Mile

Mixue Group is looking to raise about US$1bn in its upcoming Hong Kong IPO.
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.
In this note, we talk about the positive aspects of the deal.

MIXUE Group Pre-IPO – The Negatives – Declining GMV Share