Category

ECM

May 26
0

Equity Capital Markets: Sayona Mining and more

By | Daily Briefs, ECM

In today’s briefing:

  • Sayona Mining Placement – Speculative in Nature but past Deals Have Done Well

Sayona Mining Placement – Speculative in Nature but past Deals Have Done Well

By Clarence Chu

  • Sayona Mining (SYA AU) is looking to raise A$190m (approx US$135m) to restart its North American Lithium (NAL) mine.
  • On Monday (23rd May 2022), Sayona Mining had published a positive pre-feasibility study on the NAL mine, where shares have since corrected 26.8%.
  • The NAL mine is co-owned with US-based Lithium explorer, Piedmont Lithium, where Sayona Mining owns 75% interest, with the remainder 25% owned by Piedmont Lithium.

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May 24
0

Equity Capital Markets: Nufarm Ltd, Converge ICT Solutions, Delhivery, Next Chip, Cloud Village and more

By | Daily Briefs, ECM

In today’s briefing:

  • Nufarm Placement – Cleanup by Strategic Investor
  • Converge ICT Placement – Clean-Up and Buyback, Just in Time for the Index Inclusion
  • Delhivery IPO Trading – Anchor Book Was Good but Overall Demand Was Still Tepid
  • Next Chip IPO Preview
  • Cloud Village IPO Lock-Up – Selling the PE Stock (US$350m) Might Solve the Liquidity Issues

Nufarm Placement – Cleanup by Strategic Investor

By Clarence Chu

  • Sumitomo Chemical (4005 JP) is looking to sell its entire stake in Nufarm Ltd (NUF AU) to raise A$338.3m (US$240.6m).
  • Sumitomo Chemical had been a strategic investor, where it purchased 20% stake via a tender offer at A$14/share. The former had also acquired Nufarm’s South American businesses in mid-2020.
  • While this would be a clean-up sale, the deal is a large one to process at 36 days ADV.

Converge ICT Placement – Clean-Up and Buyback, Just in Time for the Index Inclusion

By Sumeet Singh

  • Warburg Pincus, aims to raise around US$138m via selling its 3.6% in Converge ICT (CICT). The sale will be accompanied by a company buyback and a private transaction.
  • Warburg had earlier sold in the IPO and then in Nov 21, and this trade will be a cleanup.
  • In this note, we will run the deal through our ECM framework.

Delhivery IPO Trading – Anchor Book Was Good but Overall Demand Was Still Tepid

By Sumeet Singh

  • Delhivery raised around US$680m in its India IPO, the company is backed by a host of financial investors, the largest being Softbank.
  • Delhivery is an online logistics service provider which covers express parcel delivery, heavy goods delivery, part truckload (PTL) freight, truckload (TL) freight, supply chain solutions, cross border solutions etc.
  • We have covered various aspects of the deal in our earlier notes. In this note, we talk about the demand and trading dynamics. 

Next Chip IPO Preview

By Douglas Kim

  • Next Chip (396270 KS) is getting ready for an IPO in Korea in June. The IPO price range is from 9,900 won to 11,600 won.
  • Next Chip is a Korean system semiconductor company for automobiles and autonomous vehicles. Next Chip was split from NC& Co Ltd (092600 KS) in January 2019.
  • The bankers used four companies including Abov Semiconductor (102120 KS), MCNEX Co Ltd (097520 KS), Chips & Media, and Telechips as comps for Next Chip Co.

Cloud Village IPO Lock-Up – Selling the PE Stock (US$350m) Might Solve the Liquidity Issues

By Sumeet Singh

  • Cloud Village Inc. (CVI), also known as NetEase Music, raised around US$420m in its Hong Kong IPO in Dec 21. The IPO was almost entirely taken up by cornerstones.
  • The company had also earlier obtained investments from Baidu and Alibaba, along with other mainly PE investors. These investors will be released from their lock-up on 1st Jun 2022.
  • In this note, we will talk about the lock-up dynamics and updates over the past few months.

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May 23
0

Equity Capital Markets: Grab and more

By | Daily Briefs, ECM

In today’s briefing:

  • GoTo: A Private Placement Larger Than the IPO and a 10% Potential Dilution

GoTo: A Private Placement Larger Than the IPO and a 10% Potential Dilution

By Shifara Samsudeen, ACMA, CGMA

  • Superapp GoTo (GOTO IJ) on Friday announced that it plans to issue 118.4bn shares through a private placement subject to shareholder approval.
  • This fresh issue accounts for 9.9% of the total outstanding shares of the company and the announcement comes 2-months after the company’s US$1.1bn IPO in March this year.
  • GoTo’s shares are down 20.4% since its IPO and the shares are trading IDR304 a piece, well below its IPO price of IDR338 per share.

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May 22
0

Equity Capital Markets: JD.com Inc (ADR) and more

By | Daily Briefs, ECM

In today’s briefing:

  • ECM Weekly (22nd May 22) – JD, LIC, Delhivery, Leapmotor, Vista, Paradeep, Woori, Hyundai Heavy, NIO

ECM Weekly (22nd May 22) – JD, LIC, Delhivery, Leapmotor, Vista, Paradeep, Woori, Hyundai Heavy, NIO

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.
  • With LIC not delivering and Delhivery needing insurance, combined with the Korean cancellations and HK silence, it looks like its going to be a quiet few weeks for IPOs.
  • On placements, both the Korean deals were a disappointment, despite being well-flagged.

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May 20
0

Equity Capital Markets: ADICON Holdings Limited and more

By | Daily Briefs, ECM

In today’s briefing:

  • Pre-IPO ADICON Holdings Limited – Uncertain Growth and Outlook in Post-COVID Era

Pre-IPO ADICON Holdings Limited – Uncertain Growth and Outlook in Post-COVID Era

By Xinyao (Criss) Wang

  • The revenue generated from COVID-19 business would not be sustainable in the long term. The lower price of COVID-19 tests, DRGs, centralized procurement and fierce competition would drag down margins.
  • ADICON hasn’t established enough advantage and moat to secure its leading position and could be overtaken by competitors.The weak R&D makes ADICON difficult to gain an edge in esoteric tests.
  • Considering the fierce competition, lower margins, the decline of COVID-19 business revenue, and poor liquidity and IPO market sentiment in HKEX, the PE could be below 10.

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May 19
0

Equity Capital Markets: Paradeep Phosphates, Leapmotor and more

By | Daily Briefs, ECM

In today’s briefing:

  • Paradeep Phosphates IPO – Smallest of the Lot and Fairly Valued as Well
  • Leapmotor Pre-IPO – The Negatives – Related Party Sanctions, Lags Peers

Paradeep Phosphates IPO – Smallest of the Lot and Fairly Valued as Well

By Clarence Chu

  • Paradeep Phosphates (75690Z IN) is looking to raise up to US$194m in its India IPO. The IPO will consist of a mix of primary and secondary shares.
  • Paradeep Phosphates (PP) is a fertilizer manufacturing company based in India. The firm engages in manufacturing, trading, distribution and sales of a variety of complex fertilizers.
  • At listing, while PP would be the smallest peer on the revenue and mcap fronts, it trails our identified peer set on the margin front as well.

Leapmotor Pre-IPO – The Negatives – Related Party Sanctions, Lags Peers

By Sumeet Singh

  • Leapmotor (LM) aims to raise around US$1bn in its Hong Kong IPO. LM is a smart EV company based in China, founded in 2015.
  • It focuses on the mid- to high-end segment in China’s NEV market with a price range of RMB150,000-300,000. As of end FY21, it had delivered a total of 52,832 cars.
  • In this note, we talk about the not so positive aspects of the deal.

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May 18
0

Equity Capital Markets: Woori Financial Group , Yunkang Group and more

By | Daily Briefs, ECM

In today’s briefing:

  • Woori Financials Placement – Almost a Clean-Up Although past Deals Haven’t Done Much
  • Yunkang Group IPO Trading –  Subdued Subscription Rates Combined with Uncertain Future Profitability

Woori Financials Placement – Almost a Clean-Up Although past Deals Haven’t Done Much

By Sumeet Singh

  • KDIC is looking to sell around half of its remaining stake in Woori Financial Group (WFG).
  • This is almost a clean-up trade considering that KDIC had a stake of nearly 18% at the start of 2021 and will now be reduced to a less than 2%.
  • In this note, we will run the deal through our ECM framework.

Yunkang Group IPO Trading –  Subdued Subscription Rates Combined with Uncertain Future Profitability

By Clarence Chu

  • Yunkang Group (2325 HK) raised around US$139m in its Hong Kong IPO.
  • On its bookbuild, subscription rates were lackluster and market sentiment hasn’t been the greatest.
  • Similar recent deals with weak subscription rates had seen subdued listing performances by the end of their respective first weeks.

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May 17
0

Equity Capital Markets: Life Insurance Corp of India (LIC), Paradeep Phosphates, Leapmotor and more

By | Daily Briefs, ECM

In today’s briefing:

  • Life Insurance Corporation IPO Trading – Demand Shored up by Policyholders, Trading Won’t Be
  • Paradeep Phosphates IPO – Operates in a Regulated Industry and Hasn’t Done Much over the past Decade
  • Leapmotor Pre-IPO – The Positives – Planned Launches Should Prop up Growth

Life Insurance Corporation IPO Trading – Demand Shored up by Policyholders, Trading Won’t Be

By Sumeet Singh

  • Government of India (GoI) raised around US$2.7bn via selling a 3.5% stake in Life Insurance Corporation of India (LIC) in its India IPO.
  • As of FY21, LIC was the largest life insurer in India with a 64.1% market share in terms of gross written premium (GWP).
  • In this note, we will talk about the demand and trading dynamics.

Paradeep Phosphates IPO – Operates in a Regulated Industry and Hasn’t Done Much over the past Decade

By Clarence Chu

  • Paradeep Phosphates (75690Z IN) is looking to raise up to US$194m in its India IPO. The IPO will consist of a mix of primary and secondary shares. 
  • Paradeep Phosphates (PP) is a fertilizer manufacturing company based in India. The firm engages in manufacturing, trading, distribution and sales of a variety of complex fertilizers.
  • While profitability improved, margins have fluctuated over the track period. Subsidies provide some downside risk protection from a raw mat price squeeze, however, MRP also limits the firm’s pricing power.

Leapmotor Pre-IPO – The Positives – Planned Launches Should Prop up Growth

By Sumeet Singh

  • Leapmotor (LM) aims to raise around US$1bn in its Hong Kong IPO. LM is a smart EV company based in China, founded in 2015.
  • It focuses on the mid- to high-end segment in China’s NEV market with a price range of RMB150,000-300,000. As of end FY21, it had delivered a total of 52,832 cars.
  • In this note, we talk about the positive aspects of the deal.

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May 15
0

Equity Capital Markets: Life Insurance Corp of India (LIC) and more

By | Daily Briefs, ECM

In today’s briefing:

  • ECM Weekly (15th May 22) – LIC, ThaiBev, Delhivery, One Store, Yunkang, VistaREIT, Ngern Tid Lor

ECM Weekly (15th May 22) – LIC, ThaiBev, Delhivery, One Store, Yunkang, VistaREIT, Ngern Tid Lor

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.
  • On the IPOs front, LIC’s lists tomorrow, while Delhivery’s bookbuild wasn’t great.
  • There were no major placements this week, with even Air New Zealand failing to hold its deal price.

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May 14
0

Equity Capital Markets: Voronoi and more

By | Daily Briefs, ECM

In today’s briefing:

  • Voronoi: Reduces IPO Price Range by 25%

Voronoi: Reduces IPO Price Range by 25%

By Douglas Kim

  • Voronoi is trying again to complete its IPO in Korea after lowering its IPO price range by 25% to 40,000 won to 46,000 won.
  • The IPO base deal size is from $41 million to $47 million. Expected market cap is from 536 billion won to 616 billion won.
  • Voronoi is developing treatments for tumors, degenerative brain diseases, and autoimmune diseases. The total amount of accumulated milestones for three global technology exports is $1.79 billion.

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