Category

ECM

Nov 27
0

Daily Brief ECM: Zensho Placement – Good Price to Raise At and more

By | Daily Briefs, ECM

In today’s briefing:

  • Zensho Placement – Good Price to Raise At, at Least for the Company
  • Pre-IPO Xiamen Yan Palace Bioengineering (PHIP Updates) – Some Points Worth the Attention

Zensho Placement – Good Price to Raise At, at Least for the Company

By Sumeet Singh

  • Zensho Holdings (7550 JP) aims to raise around US$300m via a public offering.
  • As per the company it will use the proceeds from the deal for potential M&A transactions.
  • In this note, we will talk about the deal dynamics and run the deal through our ECM framework.

Pre-IPO Xiamen Yan Palace Bioengineering (PHIP Updates) – Some Points Worth the Attention

By Xinyao (Criss) Wang

  • From 2020 to 2022, Yan Palace has spent RMB831 million on advertising and promotion, while total net profit of the Company during the same period was only about RMB500 million.
  • OneNest is the main product with the highest gross margin, which is driven by price increase strategy.However, raising price may not work. Revenue growth in 2023H2/2024 could further slow down.
  • The question is are investors really satisfied with such low-margin business for a company with strong consumption attributes? Valuation of Yan Palace should be lower than Dong E E Jiao.

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Nov 26
0

Daily Brief ECM: ZEEKR IPO Valuation Analysis: Next BYD or Tesla? and more

By | Daily Briefs, ECM

In today’s briefing:

  • ZEEKR IPO Valuation Analysis: Next BYD or Tesla?
  • ECM Weekly (26th Nov 2023) – Zeekr, Cirrus, Tata Tech, IREDA, FedBank, Juniper, GS Yuasa, AZ Com

ZEEKR IPO Valuation Analysis: Next BYD or Tesla?

By Andrei Zakharov

  • ZEEKR is expected to IPO in December. The company plans to raise up to $1B and Geely Auto may purchase additional shares of ZEEKR in a concurrent private placement.
  • I have a favorable view of the upcoming ZEEKR U.S. IPO and value ZEEKR shares using a 50/50 blend of EV/Sales analysis and long-term discounted cash flows analysis.
  • ZEEKR’s last round was a $750M Series A in February 2023 at a $13B post-money valuation. My ~$21B target valuation suggests 61% potential upside vs. last round valuation of $13B.

ECM Weekly (26th Nov 2023) – Zeekr, Cirrus, Tata Tech, IREDA, FedBank, Juniper, GS Yuasa, AZ Com

By Sumeet Singh

  • Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
  • In the IPO space, Tata Technologies didn’t disappoint Tata Group fans, at least on the subscription front.
  • The placements continued to flow in this week as well in Japan.

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Nov 25
0

Daily Brief ECM: Zensho Holdings (7550) – ¥50bn Offering Is Not Meant For You and more

By | Daily Briefs, ECM

In today’s briefing:

  • Zensho Holdings (7550) – ¥50bn Offering Is Not Meant For You

Zensho Holdings (7550) – ¥50bn Offering Is Not Meant For You

By Travis Lundy

  • Zensho Holdings (7550 JP) has had a great couple of years in share price movement. And this year is seeing earnings explode to new highs. M&A and FX.
  • Now they want to build a “war chest” equivalent to 4% of market cap to go do more M&A. 
  • This seems opportunistic. And the shareholder register is extraordinarily lopsided. There is really only one buyer for this deal.

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Nov 24
0

Daily Brief ECM: Juniper Hotels Pre-IPO – Has Been Recovering Well and more

By | Daily Briefs, ECM

In today’s briefing:

  • Juniper Hotels Pre-IPO – Has Been Recovering Well
  • Fedbank Financial IPO – Strong Sector Momentum, but This One Doesn’t Seem Particularly Compelling
  • Cirrus Aircraft Pre-IPO – PHIP Updates – Increased Customer Demand Continues to Drive Growth

Juniper Hotels Pre-IPO – Has Been Recovering Well

By Sumeet Singh

  • Juniper Hotels (JH) is looking to raise up to US$217m in its upcoming India IPO.
  • Juniper Hotels is the largest owner by no. of keys of Hyatt affiliated hotels in India as of 2Q23 (30th Jun 23), according to Horwath.
  • The company is jointly held by Saraf Hotels and its affiliate, Juniper Investments and Two Seas Holdings (an indirect subsidiary of Hyatt Hotels Corporation).

Fedbank Financial IPO – Strong Sector Momentum, but This One Doesn’t Seem Particularly Compelling

By Clarence Chu

  • Fedbank Financial Services (0702066D IN) is looking to raise about US$130m in its India IPO.
  • Fedbank Financial Services (Fedbank) is a retail-focused non-banking finance company (NBFC) promoted by The Federal Bank Limited.
  • In this note, we will look at past performance, and share our thoughts on valuation.

Cirrus Aircraft Pre-IPO – PHIP Updates – Increased Customer Demand Continues to Drive Growth

By Ethan Aw

  • Cirrus Aircraft (0153126D US) is looking to raise up to US$200m in its upcoming HK IPO.
  • Cirrus Aircraft designs, develops, manufactures, and sells premium aircrafts. Its two aircraft product lines, the SR2X Series and the Vision Jet, are currently certified and validated in over 60 countries.
  • We had covered the company’s performance in our earlier notes. In this note, we talk about its PHIP updates.

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Nov 23
0

Daily Brief ECM: Zeekr Pre-IPO – Thoughts on Valuation and more

By | Daily Briefs, ECM

In today’s briefing:

  • Zeekr Pre-IPO – Thoughts on Valuation
  • Tata Technologies IPO- Forensic Analysis
  • DS Dansuk IPO Valuation Analysis

Zeekr Pre-IPO – Thoughts on Valuation

By Sumeet Singh

  • ZEEKR (ZK US), a premium EV brand by Geely Auto (175 HK), aims to raise around US$500m in its US listing.
  • Zeekr was formed in Mar 2021 as a JV between Geely and its founder. Its first model was launched in Apr 21 with deliveries starting in Oct 21.
  • We have looked at the company’s past performance and undertaken a peer comparison in our earlier notes. In this note, we will talk about valuations.

Tata Technologies IPO- Forensic Analysis

By Nitin Mangal

  • Tata Technologies (TATATECH IN) awaited IPO is set to launch for subscription this week.
  • The company is one of the largest ER&D player that is based in India with revenues crossing INR 44 bn in F23. 
  • Balance sheet remains strong and cash rich. There are however, doubts on revenue recognition policy, forex risk and reliance on Tata Group.

DS Dansuk IPO Valuation Analysis

By Douglas Kim

  • Our base case valuation of DS Dansuk is 113,948 won per share which is 28% higher than the high end of the IPO price range (89,000 won). 
  • We estimate bio energy to account for 64.7% of total sales, followed by battery recycle (21.5%), plastic recycle (6.7%), and others (7.1%) in 2023. 
  • DS Dansuk is an eco-friendly company with three core businesses including bio energy, battery recycling, and plastic recycling.

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Nov 22
0

Daily Brief ECM: Indian Renewable Energy Development Authority IPO – A Top Player in Indian Renewable Financing and more

By | Daily Briefs, ECM

In today’s briefing:

  • Indian Renewable Energy Development Authority IPO – A Top Player in Indian Renewable Financing

Indian Renewable Energy Development Authority IPO – A Top Player in Indian Renewable Financing

By Ethan Aw

  • IREDA (1845911D IN) is looking to raise at around US$258m in its India IPO. 
  • Indian Renewable Energy Development Authority (IREDA) is a wholly owned Government of India (GoI) enterprise under the administrative control of the Ministry of New and Renewable Energy (MNRE).
  • In this note, we look at the company’s past performance and share our quick thoughts on valuation.

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Nov 21
0

Daily Brief ECM: Large GS Yuasa (6674) Placement – 20% Dilution and more

By | Daily Briefs, ECM

In today’s briefing:

  • Large GS Yuasa (6674) Placement – 20% Dilution, Needs Lots of Love
  • GS Yuasa Placement – Well Flagged but Relatively Large Deal, Liquidity Might Be an Issue
  • DS Dansuk IPO Preview
  • Flair Writing Industries IPO- Forensic Analysis
  • CaiNiao’s FYQ2: Revenue +25% Y/Y, Led by Int’l | EBITA Margin Up, Too | Solid Showing Ahead of IPO
  • AZ Com Maruwa Placement – Mixed Feelings About the Mixed Offering
  • Zeekr Pre-IPO – Peer Comparison – Catching up with Little Spending

Large GS Yuasa (6674) Placement – 20% Dilution, Needs Lots of Love

By Travis Lundy

  • Today after the close, noted Japanese battery maker Gs Yuasa Corp (6674 JP) announced a public equity offering accompanied by a 3rd party placement to Honda Motor (7267 JP). 
  • Total $300mm+ raise is nearly 20.0mm shares against ~80mm shares out now. That’s 20% EPS dilution at a still-decent discount to book value.
  • This creates a weird situation of a low ROE stock becoming lower ROE, at a lower PBR, with “more growth ahead” in a hyper-competitive space.

GS Yuasa Placement – Well Flagged but Relatively Large Deal, Liquidity Might Be an Issue

By Sumeet Singh

  • Gs Yuasa Corp (6674 JP) (GSY) is looking to raise around US$240m via a public offering, along with placing shares via third-party allotment with Honda Motor (7267 JP) .
  • The company formed a JV with Honda Motors earlier this year and will use the bulk of the proceeds for investments in the JV.
  • In this note, we will talk about the deal dynamics and run the deal through our ECM framework.

DS Dansuk IPO Preview

By Douglas Kim

  • DS Dansuk is getting ready to complete its IPO in Korea in the next several weeks. The IPO price range is from 79,000 won to 89,000 won. 
  • The book building for the institutional investors will be from 5-11 December. The IPO offering amount is from 96.4 billion won to 108.6 billion won. 
  • According to the bankers’ valuation, DS Dansuk’s valuation would range from 462 billion won to 522 billion won. 

Flair Writing Industries IPO- Forensic Analysis

By Nitin Mangal

  • Flair Writing Industries (1656496D IN) ‘s INR 5.9 bn upcoming IPO consists of fresh issue worth INR 2.9 bn and OFS worth INR 3 bn (at the upper end).
  • The company is the largest pen manufacturer in India and one of the top three players in the Indian Writing Instruments Industry.
  • While the company has shown a handsome growth since the pandemic, some operating metrics pertaining to employees don’t seem to add up.

CaiNiao’s FYQ2: Revenue +25% Y/Y, Led by Int’l | EBITA Margin Up, Too | Solid Showing Ahead of IPO

By Daniel Hellberg

  • Led by international activity, CaiNiao booked +25% Y/Y revenue growth in FYQ2
  • FYQ2 EBITA margin improved Y/Y and Q/Q, even as express companies struggled
  • Result bolsters CaiNiao status as vehicle to access BABA’s international growth

AZ Com Maruwa Placement – Mixed Feelings About the Mixed Offering

By Ethan Aw

  • AZ-Com Maruwa Holdings (9090 JP) is looking to raise around US$206m in its mixed follow-on offering. 
  • The deal will be a large one to digest, at 129 days of three month ADV, 5.5% dilution and 12.2% of current mcap.
  • In this note, we will talk about the deal dynamics and run the deal through our ECM framework.

Zeekr Pre-IPO – Peer Comparison – Catching up with Little Spending

By Sumeet Singh

  • ZEEKR (ZK US), a premium EV brand by Geely Auto (175 HK), aims to raise around US$500m in its US listing.
  • Zeekr was formed in Mar 2021 as a JV between Geely and its founder. Its first model was launched in Apr 21 with deliveries starting in Oct 21.
  • We have looked at the company’s past performance in our earlier notes . In this note, we will undertake a peer comparison.

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Nov 20
0

Daily Brief ECM: Tata Technologies IPO: Valuation Insights and more

By | Daily Briefs, ECM

In today’s briefing:

  • Tata Technologies IPO: Valuation Insights
  • WuXi XDC (2268.HK) – How Long Will the Rally Last?

Tata Technologies IPO: Valuation Insights

By Arun George

WuXi XDC (2268.HK) – How Long Will the Rally Last?

By Xinyao (Criss) Wang

  • WuXi XDC’s shares surged since IPO. Obviously, ADC industry is in a “honeymoon period”. The market is optimistic about ADC due to high certainty and growth visibility in short term.
  • Pharmaceutical companies believe this platform would produce blockbuster products continuously. However, if there’s any “persuasive event” to change optimistic expectations on ADC, it’s time for investors to reconsider WuXi XDC.
  • “Positive sentiment + non-falsifiable short-term logic” would indeed push WuXi XDC’s shares to a new high. As long as sales of major ADCs are in line with expectations, party continues.

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Nov 19
0

Daily Brief ECM: ECM Weekly (19th Nov 2023)- Asahi and more

By | Daily Briefs, ECM

In today’s briefing:

  • ECM Weekly (19th Nov 2023)- Asahi, Ajinomoto, Steadfast, Karoon, Wuxi, Ecopro, Zeekr, Tata Tech

ECM Weekly (19th Nov 2023)- Asahi, Ajinomoto, Steadfast, Karoon, Wuxi, Ecopro, Zeekr, Tata Tech

By Sumeet Singh

  • Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
  • In the IPO space, WuXi XDC ended up doing well, as expected. Now Tata Technologies will be another one to watch.
  • The placements continued to flow in this week as well, with both Australia and Japan deals coming relatively thick and fast, at least by 2023’s pace.

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Nov 18
0

Daily Brief ECM: Tata Technologies IPO – Parent and Peer Rally Helps and more

By | Daily Briefs, ECM

In today’s briefing:

  • Tata Technologies IPO – Parent and Peer Rally Helps

Tata Technologies IPO – Parent and Peer Rally Helps

By Sumeet Singh

  • Tata Technologies (TT) is looking to raise around US$370m in its upcoming India IPO.
  • Tata Technologies is a global engineering services company offering product development and digital solutions, including turnkey solutions, to global original equipment manufacturers (OEMs) and their tier 1 suppliers.
  • In our previous note, we looked at the company’s past performance. In this note, we talk about valuations.

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