ECM Daily Briefs | Page 5 of 114

In today’s briefing:

SF Holding Pre-IPO: FY23, Q124 Results Reviewed | Sales Mix Impacts | Recent Monthly Revenue Trend
ECM Weekly (10th June 2024) – Webtoon, Shift Up, QuantumPharm, Guzman, Kakaopay, Telix, Yankuang

SF Holding Pre-IPO: FY23, Q124 Results Reviewed | Sales Mix Impacts | Recent Monthly Revenue Trend

By Daniel Hellberg

In this insight we cover recent earnings results, revenue mix, YTD trends
Fluctuating performance of its international segment impacted FY23 and Q124
Improving international segment could boost overall momentum in Q2-Q4 2024

ECM Weekly (10th June 2024) – Webtoon, Shift Up, QuantumPharm, Guzman, Kakaopay, Telix, Yankuang

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 looked at Guzman Y Gomez (0817833D AU), QuantumPharm (QUP HK) and Webtoon Entertainment (WBTN US) this week.
On the placement front, there were a few deals across Hong Kong, Australia and Japan.

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Jun 09

Daily Brief ECM: Tempus AI IPO: AI in Diagnostics at Scale and more

In today’s briefing:

Tempus AI IPO: AI in Diagnostics at Scale, Investor Sentiment Appears Positive

Tempus AI IPO: AI in Diagnostics at Scale, Investor Sentiment Appears Positive

By Andrei Zakharov

Tempus AI, a healthcare IT company and provider of next-gen diagnostics, is expected to IPO next week. The company plans to raise $411M at the high end of the range.
The most recent S-1/A puts the expected price range per share at $35 to $37, implying a market cap of ~$6B at the midpoint.
Tempus AI provides personalized cancer care and brings AI to healthcare at scale. They train LLMs to develop AI applications and have the largest public genomic data sets in oncology

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Jun 08

Daily Brief ECM: Initial Thoughts on the Yanolja IPO and more

In today’s briefing:

Initial Thoughts on the Yanolja IPO

Initial Thoughts on the Yanolja IPO

Yanolja is getting ready to complete its IPO in the US in the next several months. Softbank invested about US$1.7 billion in Yanolja in 2021.
The valuation of Yanolja could be between US$7 billion to US$9 billion. The company could raise nearly US$400 million in this IPO.
Overall, we are concerned about the valuations of Yanolja if indeed the bankers push ahead with the IPO at the valuation range of US$7 billion to US$9 billion.

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Jun 07

Daily Brief ECM: What Did FSS Point Out to Shift Up? & What Impact Would It Have on Bookbuilding Sentiment? and more

In today’s briefing:

What Did FSS Point Out to Shift Up? & What Impact Would It Have on Bookbuilding Sentiment?
Guzman Y Gomez IPO – The Positives – Network Growing, Sales Have Outpaced Network Growth
QuantumPharm IPO – Most of the Potential Has Already Been Baked In
Guzman Y Gomez IPO – The Negatives – Lawsuits and Management Churn

What Did FSS Point Out to Shift Up? & What Impact Would It Have on Bookbuilding Sentiment?

By Sanghyun Park

FSS wants Nikke’s MAU data to address revenue concerns. They also seek April and May sales data for Stellar Blade to address valuation concerns despite its recent launch.
Shift Up updated the prospectus with Nikke’s increasing MAU data but didn’t include Stellar Blade sales data. FSS may request further revisions, possibly delaying the IPO again.
Nikke’s MAU has risen but plateaued versus the previous quarter, and uncertainty surrounds Stellar Blade’s April-May sales, potentially impacting IPO pricing.

Guzman Y Gomez IPO – The Positives – Network Growing, Sales Have Outpaced Network Growth

Guzman Y Gomez plans to raise around US$160m in its Australian IPO.
GYG is a quick service restaurant business with more than 200 restaurants globally. It mainly focuses on fresh, made-to-order, Mexican-inspired food.
In this note, we look at the company’s prior performance and future prospects.

QuantumPharm IPO – Most of the Potential Has Already Been Baked In

QuantumPharm (QUP HK) is looking to raise US$144m from its 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 notes, we looked at the firm’s past performance and PHIP updates. In this note, we share our thoughts on valuations.

Guzman Y Gomez IPO – The Negatives – Lawsuits and Management Churn

Guzman Y Gomez plans to raise around US$160m in its Australian IPO.
GYG is a quick service restaurant business with more than 200 restaurants globally. It mainly focuses on fresh, made-to-order, Mexican-inspired food.
In this note, we talk about the not-so-positive aspects of the deal.

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Jun 06

Daily Brief ECM: Shift Up Delays the IPO and Stellar Blade Tops Number One Game in the US in April and more

In today’s briefing:

Shift Up Delays the IPO and Stellar Blade Tops Number One Game in the US in April
Sakura Internet Placement – Beneficiary of the AI-Wave Looking to Double Down
Webtoon Entertainment Pre-IPO – The Positives – Just Turned Profitable
Pre-IPO Midea Group H Share – Even in the Face of Challenges, There Is Still Investment Value
Webtoon Entertainment Pre-IPO – The Negatives – Korea Revenue Declined, JP Acquisition to the Rescue

Shift Up Delays the IPO and Stellar Blade Tops Number One Game in the US in April

On 5 June, Shift Up announced that it will be postponing its IPO to July. The original book building period for the institutional investors was from 3 to 13 June.
The final book building date has been postponed to 27 June. The subsequent public offering subscription for general investors was also postponed to 2 to 3 July.
A major investment positive of Shift Up is enormous initial success of Stellar Blade which was the best selling game in the U.S. and numerous other countries in April 2024.

Sakura Internet Placement – Beneficiary of the AI-Wave Looking to Double Down

Sakura internet (3778 JP) is looking to raise US$127m from its primary follow-on. Proceeds will be used towards purchasing GPU servers, and constructing new data center facilities.
While 11% of total shares outstanding are offered here, the deal would be easily digested by the market, representing just 0.8 days of its three month ADV.
In this note, we run the deal through our ECM framework and comment on deal dynamics.

Webtoon Entertainment Pre-IPO – The Positives – Just Turned Profitable

By Ethan Aw

Webtoon Entertainment (WBTN US) is looking to raise up to US$500m in its US IPO.
Webtoon Entertainment is a global storytelling platform where a community of creators and users discover, create and share new content.
In this note, we talk about the positive aspects of the deal.

Pre-IPO Midea Group H Share – Even in the Face of Challenges, There Is Still Investment Value

By Xinyao (Criss) Wang

Although Midea’s performance keeps growing, it is difficult for the home appliance industry to return to rapidly growing incremental market as it was during the robust development of real estate.
As Midea’s To C business encounters growth bottleneck, To B business has become new performance driver and second growth curve, but several new businesses are facing challenges in 24Q1.
For mature leading enterprises in home appliance industry, a valuation of 10-20x PE is reasonable, which means market value of RMB370-740 billion, assuming 2024 net profit would reach RMB37 billion.

Webtoon Entertainment Pre-IPO – The Negatives – Korea Revenue Declined, JP Acquisition to the Rescue

By Ethan Aw

Webtoon Entertainment (WBTN US) is looking to raise up to US$500m in its US IPO.
Webtoon Entertainment is a global storytelling platform where a community of creators and users discover, create and share new content.
In this note, we talk about the not-so-positive aspects of the deal.

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Jun 05

Daily Brief ECM: MMG (1208 HK) – $1.1bn+ Rights Offering – Expect Regular Rights Trading Dynamics and more

In today’s briefing:

MMG (1208 HK) – $1.1bn+ Rights Offering – Expect Regular Rights Trading Dynamics
MMG (1208 HK): US$1.2bn Highly Dilutive Rights Issue
Raspberry Pi IPO Valuation Analysis

MMG (1208 HK) – $1.1bn+ Rights Offering – Expect Regular Rights Trading Dynamics

By Travis Lundy

Mmg Ltd (1208 HK) today announced a 2:5 Rights Offering to raise US$1.15bn at HK$2.62/share in order to pay down debt from their recent Botswanan copper mine acquisition.
It was a sizeable acquisition, and the near-term EV/EBITDA of the acquisition is 10x or above. The longer-term EV/EBITDA is in the 3s based on expansion later this decade.
The Rights Offering is underwritten, supported by its 67.5% owner. SOUTHBOUND holds 10+%. There are short dynamics, arb dynamics, “don’t wanna spend more” dynamics. There’s a path here.

MMG (1208 HK): US$1.2bn Highly Dilutive Rights Issue

By Arun George

Mmg Ltd (1208 HK) will raise HK$9.1bn (US$1.2bn) through 2 rights shares for every 5 existing shares rights offering. The rights price is HK$2.62, a 24.7% discount to the TERP.
The rights proceeds will be used to repay existing debt, which will allow it to use other funds to better support the ongoing development of the operating mines.
MMG shares should continue to decline heading into the ex-rights date. The shares go ex-rights on 11 June, and the rights start trading from 24 June to 2 July (inclusive).

Raspberry Pi IPO Valuation Analysis

Raspberry Pi is expected to raise about £157 million in this IPO. The conditional trading for this IPO is expected to be take place on 11 June.
We estimate Raspberry Pi to generate sales of US$342.1 million (up 28.7% YoY) and operating profit of US$48.5 million (up 29.3% YoY) in 2024.
Our base case valuation of Raspberry Pi is market cap of £772 million or £4 per share (43% higher than the high end of the initial IPO price range).

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Jun 04

Daily Brief ECM: Webtoon Entertainment IPO Preview and more

In today’s briefing:

Webtoon Entertainment IPO Preview
Yankuang Energy Placement – Doesn’t Appear Well Flagged Although Deal Size Is Large
Pre-IPO QuantumPharm (PHIP Updates) – Some Points Worth the Attention

Webtoon Entertainment IPO Preview

Webtoon Entertainment is getting ready to complete its IPO on the NASDAQ exchange in 2H 2024. Webtoon Entertainment is a subsidiary of Naver Corp (035420 KS).
Webtoon is seeking to raise as much of US$500 million at a valuation of US$3 billion to US$4 billion.
Webtoon Entertainment is one of the largest Korean company related IPOs in 2024.

Yankuang Energy Placement – Doesn’t Appear Well Flagged Although Deal Size Is Large

By Ethan Aw

Yankuang Energy Group (1171 HK) is looking to raise up to US$608m through a primary follow-on, via selling 270m H-shares.
The deal is a somewhat large one to digest, at 10.6 days of three month ADV and 2.7% of current mcap.
In this note, we will talk about the placement and run the deal through our ECM framework.

Pre-IPO QuantumPharm (PHIP Updates) – Some Points Worth the Attention

By Xinyao (Criss) Wang

We have always been concerned about QuantumPharm’s business model. It is relatively difficult for a service provider like QuantumPharm to scale up revenue by just relying on charging service fees.
For AI pharmaceutical companies, how to make money is a pain point for entire industry. Just focusing on preclinical stages would limit profitability.We haven’t seen any certainty of achieving breakeven.
Increasing competition would bring more challenges for QuantumPharm. Post-investment valuation in 2021 was too expensive.If its future performance falls short of expectations, then sooner or later the valuation will collapse.

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Jun 03

Daily Brief ECM: ECM Weekly (3rd June 2024) – Shift Up and more

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