ECM Daily Briefs | Page 75 of 118

In today’s briefing:

Daemyung Energy Bookbuilding Results
Life Insurance Corp of India IPO: Valuation Insights

Daemyung Energy Bookbuilding Results

Daemyung Energy announced its IPO book building results. The IPO price has been determined at 15,000 won, which is at the low end of the IPO price range.
There were 890 institutions that were involved in the IPO survey and the demand ratio was 255 to 1. The IPO offering amount is 37.5 billion won.
Our base case valuation of Daemyung Energy is target price of 28,784 won per share, which is 92% premium to the IPO price of 15,000 won.

Life Insurance Corp of India IPO: Valuation Insights

By Arun George

Life Insurance Corp of India (LIC) (1248Z IN) is the largest life insurer in India. At the IPO price range of Rs902-904, the Indian government aims to raise $2.6-2.7 billion.
In Life Insurance Corp of India IPO: Key Takeaways from the RHP, we outlined the latest developments from the Red Herring Prospectus.
In this note, we look at LIC’s valuation metrics. In light of the challenging market conditions, the IPO price range is reasonable.

Before it’s here, it’s on Smartkarma

May 02

Equity Capital Markets: SK Shieldus and more

In today’s briefing:

ECM Weekly (2nd May 22) – LIC, Shieldus, One Store, Campus, Rainbow, Kakao Pay, Uju, GoTo, Zhongyuan

ECM Weekly (2nd May 22) – LIC, Shieldus, One Store, Campus, Rainbow, Kakao Pay, Uju, GoTo, Zhongyuan

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, Campus Activewear got great coverage, while Rainbow and Shieldus appear to be struggling.
There were no large placements, apart from a selldown in Areit (AyalaLand REIT) (AREIT PM) and a friends and family round in Zhongyuan Bank (1216 HK).

Before it’s here, it’s on Smartkarma

Apr 30

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

In today’s briefing:

Life Insurance Corp of India IPO: Key Takeaways from the RHP

Life Insurance Corp of India IPO: Key Takeaways from the RHP

By Arun George

Life Insurance Corp of India (LIC) (1248Z IN) is set to launch its IPO with the anchor investor offer period starting 2 May. The offer period closes on 9 May.
At the IPO price range of Rs902-949, the Indian government aims to raise $2.6-2.7 billion, which is materially lower than the initial target of $8.7 billion.
Following up on Life Insurance Corp of India IPO: Premium Market, in this note, we look at the latest developments from the Red Herring Prospectus.

Before it’s here, it’s on Smartkarma

Apr 29

Equity Capital Markets: Campus Activewear Ltd, Life Insurance Corp of India (LIC), Chungdam Global, Scivita Medical Technology and more

In today’s briefing:

Campus Activewear IPO: Mysterious Return Ratios
Life Insurance Corporation of India IPO – Regional Peer Comparison
Chungdam Global IPO Preview
Pre-IPO Scivita Medical Technology – The Industry, the Business, and the Concerns

Campus Activewear IPO: Mysterious Return Ratios

By Nitin Mangal

Campus Activewear Ltd (1535013D IN) is about to go public soon.
The RHP has portrayed Campus’s return ratios such as ROCE to be one of the highest in its peer group, inching past the likes of Bata India Ltd (BATA IN).
However, upon further investigation of the financials, the return ratios seem to be mysterious, simply because of capital reserve arising from acquisition of promoter-companies, back when Ind AS was adopted.

Life Insurance Corporation of India IPO – Regional Peer Comparison

Government of India (GoI) is looking to raise around US$2.7bn via selling a 3.5% stake in Life Insurance Corporation of India (LIC) in its upcoming India IPO.
This is less than half of its initial plans in terms of fundraising target and comes at less than half of its initial valuation target.
We have looked at various aspects of the deal in our earlier notes. In this note, we compare it to its international peers and talk about valuations.

Chungdam Global IPO Preview

Chungdam Global is getting ready to complete its IPO in the next several weeks. The expected market cap after the IPO is from 179 billion won to 204 billion won.
Chungdam Global sells Korean cosmetics and other global beauty brands to e-commerce companies in China and other countries. It generated more than 75% of its sales in 2021 from JD.com.
The company experienced exceptional growth in sales and profits in the past several years. Its sales and operating profits jumped by 97.4% and 204% CAGR from 2019 to 2021, respectively

Pre-IPO Scivita Medical Technology – The Industry, the Business, and the Concerns

By Xinyao (Criss) Wang

Scivita Medical Technology (SMT HK) has certain technical advantage and a comprehensive portfolio of products and candidates, which would help the Company seize a position in this market.
There are also some potential risks and concerns that could be unfavorable for Scivita’s development, which should be aware of by investors.
In terms of the valuation, SonoScape and Aohua Endoscopy (688212.CH) could be the comparable companies, but the valuation of Scivita should be lower than either of them.

Before it’s here, it’s on Smartkarma

Apr 28

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

In today’s briefing:

Life Insurance Corporation of India IPO – Valuation Is Ok but Its Not the Best Deal Structure

Life Insurance Corporation of India IPO – Valuation Is Ok but Its Not the Best Deal Structure

Government of India (GoI) is looking to raise around US$2.7bn via selling a 3.5% stake in Life Insurance Corporation of India (LIC) in its upcoming India IPO.
This is less than half of its initial plans in terms of fundraising target and comes at less than half of its initial valuation target.
In this note, we will talk about the final deal terms and structure, RHP updates and do a quick valuation refresh.

Before it’s here, it’s on Smartkarma

Apr 27

Equity Capital Markets: SK Shieldus and more

In today’s briefing:

SK Shieldus Controversies: Excessive Valuations & Suspicious Surge in Internal Sales

SK Shieldus Controversies: Excessive Valuations & Suspicious Surge in Internal Sales

By Sanghyun Park

Suppose we grouped S1 and Taiwan Secom with the Physical/Integrated Security weighting and then applied the Cybersecurity weighing to Ahnlab and CyberOne. We would have 11.40x, substantially lower than 14.85x.
SK Shieldus’ sales were ₩1.55T, an increase of ₩0.22T (16.8%) from the previous year. But 65% of last year’s sales increase was derived from the internal deals with SK Group.
How the company and the bankers will respond to those mentioned above two controversial aspects will be the most crucial point in determining the success or failure of this IPO.

Before it’s here, it’s on Smartkarma

Apr 26

Equity Capital Markets: Rainbow Children’s Hospital, Winia Aid, Uju Holding and more

In today’s briefing:

Rainbow Children’s Hospital – Recent Updates and Peer Comp
Winia Aid IPO Preview
Uju Holding IPO Lock-Up – Would Improve the Liquidity but We Wouldn’t Be Buyers
Rainbow Children’s Hospital IPO – Thoughts on Valuation

Rainbow Children’s Hospital – Recent Updates and Peer Comp

Rainbow Children’s Hospital (RCH) aims to raise around US$200m via issuing a mix of primary and secondary shares in its India IPO.
RCH is a multi-specialty pediatric and obstetrics and gynecology hospital chain in India, operating 14 hospitals and three clinics in six cities, with a total bed capacity of 1,500 beds.
In this note, we will talk about the recent updates and peer comparison.

Winia Aid IPO Preview

Winia Aid is getting ready to complete its IPO in June. According to the bankers’ valuation, market cap after the IPO is from 219 billion won to 249 billion won.
It has three main businesses including distribution, logistics, and services. Distribution and logistics are for Winia and other global products. Service is mainly for Apple’s authorized service provider in Korea.
The company has a solid growth in sales and profits. From 2018 to 2021, the company’s revenue and operating profit increased by 39.2% and 86.2% CAGR, respectively.

Uju Holding IPO Lock-Up – Would Improve the Liquidity but We Wouldn’t Be Buyers

By Clarence Chu

Uju Holding raised US$103m from its Hong Kong IPO in Nov 2021, where the IPO had been priced at the bottom end.
The offering was only mildly oversubscribed and the two cornerstones in the deal, Bytedance and Green Better (Xiaomi), had combined to subscribe to 12.6% of the offer shares
The cornerstones and Pre-IPO investors’ stake are coming up for lockup expiry. The latter will see half of their stakes unlocked, with the remainder locked up for another six months.

Rainbow Children’s Hospital IPO – Thoughts on Valuation

Rainbow Children’s Hospital (RCH) aims to raise around US$200m via issuing a mix of primary and secondary shares in its India IPO.
RCH is a multi-specialty pediatric and obstetrics and gynecology hospital chain in India, operating 14 hospitals and three clinics in six cities, with a total bed capacity of 1,500 beds.
In this note, we will talk about our earnings forecast and thoughts on valuation.

Before it’s here, it’s on Smartkarma

Apr 25

Equity Capital Markets: SK Shieldus and more

In today’s briefing:

SK Shieldus IPO: The Syndicate’s Revised Methodology

SK Shieldus IPO: The Syndicate’s Revised Methodology

By Arun George

SK Shieldus (ABFHIZ KS) is a leading South Korean security provider. It is seeking a KRX IPO to raise up to US$0.9 billion.
The primary change in the updated prospectus is the syndicate’s valuation methodology which results in a 10% lower value per share. The IPO price range of KRW31,000-38,800 is unchanged.
Sentiment on IPOs remains poor. For investors willing to look at IPOs, our valuation analysis suggests that the IPO price range remains reasonable.

Before it’s here, it’s on Smartkarma

Apr 22

Equity Capital Markets: Zhihu Technology, SK Shieldus, Campus Activewear Ltd, HilleVax and more

In today’s briefing:

Zhihu HK Secondary Listing Trading – Delivered the Correction but Still Set for the Worst Debut Yet
SK Shieldus IPO: Revises IPO Filing But Maintains Same Price Range
Campus Activewear IPO – Peer Comparison-Competitive Market, Firm Has Been Resilient During Pandemic
Campus Activewear Pre-IPO – Synergistic Business Model, but in a Fragmented Industry
HilleVax Pre-IPO: Lead Candidate Has Potential to Become First Approved Vaccine for Norovirus

Zhihu HK Secondary Listing Trading – Delivered the Correction but Still Set for the Worst Debut Yet

Zhihu Technology (ZH US) raised around US$106m via a dual primary listing in Hong Kong.
Unlike all the prior dual primary/secondary listings which have been done via offering either only primary or a mix of primary+secondary shares, Zhihu’s offering will consist of only secondary shares.
In this note, we’ll talk about the demand and trading dynamics.

SK Shieldus IPO: Revises IPO Filing But Maintains Same Price Range

After the market close today, SK Shieldus revised its IPO filing, especially for the valuation comps. However, it maintained the same IPO price range of 31,000 won to 38,800 won.
Bankers included two new comps (Taiwan Secom and Cyberone). Bankers excluded ADT Inc, Alarm.com, and Qualys as comps.
Our valuation of SK Shieldus suggests market cap of 4.1 trillion won or target price of 44,892 won (28.6% higher than the mid-point of the IPO price range).

Campus Activewear IPO – Peer Comparison-Competitive Market, Firm Has Been Resilient During Pandemic

By Clarence Chu

Campus Activewear Ltd (1535013D IN) is looking to raise about US$184m in its India IPO, via a 100% secondary selldown.
While there are other domestically listed footwear makers, Campus’ competitors generally market a broader product offering, ranging from casual, formal or outdoor shoes etc..
Campus’ performance was amongst the most resilient during the pandemic, but its margins continues to trail peers.

Campus Activewear Pre-IPO – Synergistic Business Model, but in a Fragmented Industry

By Clarence Chu

Campus Activewear Ltd (1535013D IN) is looking to raise about US$200m in its India IPO, via a 100% secondary selldown.
Campus Activewear is a lifestyle-oriented sports and athleisure footwear firm based in India.
Operating under the “CAMPUS” brand, the firm offers a diverse portfolio of styles, color palettes, and price points.

HilleVax Pre-IPO: Lead Candidate Has Potential to Become First Approved Vaccine for Norovirus

By Tina Banerjee

HilleVax (HLVX US), a novel vaccine developer intends to raise $100 million through an IPO. Its lead program HIL-214, intended to prevent norovirus infection is in phase 2 clinical trial.
The number of shares to be offered and the price range are yet to be disclosed. Post listing, the company will trade under the ticker HLVX on the Nasdaq.
HIL-214’s large addressable market, with huge unmet need, HilleVax’s earlier fund-raising history, and Takeda’s backing are some of the positives of this new offering.

Before it’s here, it’s on Smartkarma

Apr 21

Equity Capital Markets: GoTo, Rainbow Children’s Hospital, Tailim Paper and more

By Shifara Samsudeen, ACMA, CGMA

In today’s briefing:

GoTo IPO: Shares Are Still Overvalued and There Is Further Downside
Rainbow Children’s Hospital Pre-IPO – Still Growing but Not All Regions Have Been Performing
Tailim Paper IPO Valuation Analysis

GoTo IPO: Shares Are Still Overvalued and There Is Further Downside

Superapp GoTo (GOTO IJ) made its public debut on the Indonesian Stock Exchange on 11th April. The company set the final IPO price at IDR338 per share.
GoTo’s shares surged nearly 23% to IDR416 a piece on the open, boosting the company’s market cap to more than IDR497trn.
GoTo’s share price has continued to slide and our SOTP valuation suggests that there is further downside.

Rainbow Children’s Hospital Pre-IPO – Still Growing but Not All Regions Have Been Performing

Rainbow Children’s Hospital (RCH) aims to raise around US$250m via issuing a mix of primary and secondary shares in its India IPO.
RCH is a multi-specialty pediatric and obstetrics and gynecology hospital chain in India, operating 14 hospitals and three clinics in six cities, with a total bed capacity of 1,500 beds.
In this note, we will talk about the company’s past performance.

Tailim Paper IPO Valuation Analysis

Our base case valuation of Tailim Paper is target price of 19,692 won, which is at the low end of the IPO price range. We would pass on this IPO.
Our target price of 19,692 won is based on 5.8x EV/EBITDA using 2021 EBITDA. The EV/EBITDA multiple of 5.8x is at a 40% premium to the comps’ average.
Tailim Paper has higher sales growth rate, operating margins, and ROE than its peers. However, it has a weaker balance sheet than its peers.

Before it’s here, it’s on Smartkarma