ECM Daily Briefs | Page 77 of 118

In today’s briefing:

GoTo IPO Trading – A Test for the Domestic Market

GoTo IPO Trading – A Test for the Domestic Market

GoTo was initially aiming to raise around US$1.25bn from a local listing. It managed to raise US$960m after downsizing its deal and pricing close to the midpoint.
GoTo, is an Indonesian holding company, was formed in May 2021 as a result of a merger between Gojek, leading player in ride hailing, and Tokopedia, leading e-commerce player.
In this note, we’ll talk about the trading dynamics of the deal.

Before it’s here, it’s on Smartkarma

Apr 08

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

In today’s briefing:

Life Insurance Corporation of India Pre-IPO – Peer Comparison, Quick Thoughts on Rumored Valuations
OneStore IPO Valuation Analysis
One Store Pre-IPO – Track Record Has Been Strong, Questions Surround Its Choice of Peers

Life Insurance Corporation of India Pre-IPO – Peer Comparison, Quick Thoughts on Rumored Valuations

Government of India (GoI) is now said to be looking to raise around US$6-7bn via selling a stake in Life Insurance Corporation of India (LIC) in its upcoming India IPO.
As of FY21, LIC was the largest life insurer in India with a 64.1% market share in terms of GWP, a 66.2% market share in terms of NBP.
In this note, we undertake a peer comparison and look at the implied multiples at the rumored valuations.

OneStore IPO Valuation Analysis

Our base case valuation of OneStore is market cap of 1.3 trillion won and target price of 48,713 won per share (28% higher than the IPO mid-point price range).
Our valuation of the company is based on P/S multiple of 4.8x (average of the peers) using our estimated sales of 269 billion won for the company in 2022.
In our comparable companies valuation analysis, we have used the following four Korean companies as comps including Kakao Corp, Naver Corp (035420 KS), AfreecaTV (067160 KS), Kidari Studio (020120 KS).

One Store Pre-IPO – Track Record Has Been Strong, Questions Surround Its Choice of Peers

ONE Store (ONE KS) is looking to raise up to US$228m in its upcoming Korean IPO.
One Store is a mobile app market platform, formed by a cooperation between South Korea’s three telecom carriers, together with Naver Corp, an internet firm in South Korea.
By cutting its commission take rate to attract developers, the firm has managed to turnaround its transaction volume in FY18, leading it to record consecutive quarters of growth.

Before it’s here, it’s on Smartkarma

Apr 07

Equity Capital Markets: SK Shieldus, Ecopro BM Co Ltd, Daemyung Energy, ONE Store and more

In today’s briefing:

SK Shieldus IPO: Offering Details, Valuation Issues, & Index Fast Entry
SK Shieldus IPO – The Positives – Decent Growth, Diversifying Its Revenue Base
Ecopro BM Rights Offering Worth 500 Billion Won
Daemyung Energy: Lowers IPO Price Range by 40%
ONE Store IPO: Offering Details & Valuation Issues
SK Shieldus IPO – The Negatives – No Shield for Its Margin, in Multi-Year Decline

SK Shieldus IPO: Offering Details, Valuation Issues, & Index Fast Entry

By Sanghyun Park

S1 Corp is more giant in sales and ranks first in the local on-site security market, so it is tough to understand why SK Shieldus should receive a higher valuation.
If the growth story is sexier, the story may be different. Still, many investors will have doubts about whether SK Shieldus’ growth story is convincingly explained in the IPO prospectus.
Even the lower end of the indicative price band is likely to be downwardly corrected in the post-IPO price-finding. Hence, I do not recommend an aggressive approach to this IPO.

SK Shieldus IPO – The Positives – Decent Growth, Diversifying Its Revenue Base

SK Shieldus (SKS) aims to raise around US$800m via a mix of issuing primary and secondary shares in its Korea IPO.
SKS is the security subsidiary of SK Square. It provides security services across four main categories: information security/Cybersecurity, convergence security, physical security, and Safety & Care.
In this note, we will talk about the postive aspects of the deal.

Ecopro BM Rights Offering Worth 500 Billion Won

After the market close today, Ecopro BM announced a rights offering worth 500 billion won as well as a bonus issue of three new shares for one existing share.
The tentative rights offering price is 310,300 won, which is 27% lower than current price of 423,800 won.
Ecopro BM’s valuations remain stretched with its shares trading at high multiples and we believe there could be some further weakness in its share price in the coming weeks.

Daemyung Energy: Lowers IPO Price Range by 40%

Daemyung Energy is trying again for an IPO in Korea, after about three months delay.
It has lowered the IPO price range by nearly 40% from (25,0000 won -29,000 won) to (15,000 won – 18,000 won).
Our base case valuation of Daemyung Energy is target price of 28,784 won per share, which is 60% upside from the high end of the IPO price range,

ONE Store IPO: Offering Details & Valuation Issues

By Sanghyun Park

It will be difficult to reach a valuation consensus in the short term, suggesting the likelihood of substantially higher price volatility after listing. The IPO valuation itself is quite excessive.
There are not enough stories to instill growth expectations in investors. Expectations for regulatory benefits are uncertain. The inclusion to K-New Deal and WISE Media Contents are worth a look.
In conclusion, I do not recommend an aggressive approach to this IPO. Similar to SK Shieldus, we even need to consider a post-listing entry.

SK Shieldus IPO – The Negatives – No Shield for Its Margin, in Multi-Year Decline

SK Shieldus (SKS) aims to raise around US$800m via a mix of issuing primary and secondary shares in its Korea IPO.
SKS is the security subsidiary of SK Square. It provides security services across four main categories: information security/Cybersecurity, convergence security, physical security, and Safety & Care.
In this note, we will talk about the not so positive aspects of the deal.

Before it’s here, it’s on Smartkarma

Apr 06

Equity Capital Markets: SK Shieldus and more

In today’s briefing:

SK Shieldus IPO Valuation Analysis
SK Shieldus IPO: Valuation Insights

SK Shieldus IPO Valuation Analysis

Our valuation of SK Shieldus suggests target price of 44,892 won, which is 29% higher than the mid-point of the IPO price range of 34,900 won.
We would subscribe to this IPO as the company has strong business moat, especially for the physical security business and its convergence security/cybersecurity businesses are enjoying excellent customer demand.
Although we have a positive view of SK Shieldus, there will be some investors that stay away from this IPO due to its high debt levels and rising interest rates.

SK Shieldus IPO: Valuation Insights

By Arun George

SK Shieldus (ABFHIZ KS) is a leading South Korean security provider. It is pre-marketing a KRX IPO to raise up to US$0.9 billion.
In SK Shieldus IPO Initiation: Track and Shield, we noted that SK shieldus has attractive fundamentals with healthy growth and margins. The leverage is manageable due to good cash generation.
In this note, we look at the syndicate’s valuation methodology and present our valuation methodology. Our valuation analysis suggests that the IPO price range is attractive.

Before it’s here, it’s on Smartkarma

Apr 05

Equity Capital Markets: Alibaba Group, SK Shieldus and more

In today’s briefing:

China ADRs Delisting – Tide Is Turning with CSRC Showing Signs of a Compromise
SK Shieldus IPO: Industry Dynamics of Four Business Units
SK Shieldus IPO Initiation: Track and Shield

China ADRs Delisting – Tide Is Turning with CSRC Showing Signs of a Compromise

On 2nd Apr 2022, CSRC put out a draft for public comments on the revision of certain provisions which would allow easier access by overseas regulators to China ADRs audits.
On 8th Mar 2022, Securities Exchange Commission (SEC) had added five China ADR names to its provisional list of issuers under HFCAA, which set the clock ticking for their delisting.
In this note, we’ll talk about the latest developments and its implications.

SK Shieldus IPO: Industry Dynamics of Four Business Units

In this insight, we provide further details of the four main business units of SK Shieldus, which is a leading one-stop shop provider for security services in Korea.
The company has been able to improve the customer churn rate of the Physical Security (CMS) unit from 14.7% in 2019 to 11.7% in 2021.
The leading global cybersecurity stocks have been outperforming the market this year by a big margin which should have a positive impact on the SK Shieldus IPO.

SK Shieldus IPO Initiation: Track and Shield

By Arun George

SK Shieldus (ABFHIZ KS) is a leading South Korean security provider. It is pre-marketing a KRX IPO to raise up to US$0.9 billion.
SK shieldus is offering 27.1 million shares with a primary/secondary split of 53/47 at an indicative price range of KRW31,000- 38,800 per share.
SK shieldus has attractive fundamentals with healthy growth and margins. The leverage is manageable due to good cash generation.

Before it’s here, it’s on Smartkarma

Apr 03

Equity Capital Markets: JD.com Inc., ONE Store and more

In today’s briefing:

ECM Weekly (3rd Apr 2022)- JD, Tencent, Prosus, One Store, SK Shieldus, FWD, Ferretti, Recbio, Belle
OneStore IPO Preview

ECM Weekly (3rd Apr 2022)- JD, Tencent, Prosus, One Store, SK Shieldus, FWD, Ferretti, Recbio, Belle

Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
Placements continued to flow in, at a slower pace than last week, with Malaysia and ANZ chipping in.
While the HK IPO scene failed to produce anything noteworthy with its two listing, South Korea appears to be leading the charge, once again.

OneStore IPO Preview

OneStore is getting ready to complete its IPO in May with IPO price range of 34,300 won to 41,700 won. It is one of the largest app operators in Korea.
The IPO base deal size is from $187 million to $227 million. The expected market cap after the IPO is from 0.9 trillion won to 1.1 trillion won.
OneStore generated sales of 214.2 billion won (up 38% YoY), operating loss of 5.8 billion won, and EBITDA of 8 billion won in 2021.

Before it’s here, it’s on Smartkarma

Apr 02

Equity Capital Markets: SK Shieldus and more

In today’s briefing:

SK Shieldus IPO Preview

SK Shieldus IPO Preview

SK Shieldus is getting ready to complete its IPO in Korea in May. The IPO price range is from 31,000 won to 38,800 won.
According to bankers’ valuation, the expected market cap of SK Shieldus is from 2.8 trillion won to 3.5 trillion won. The IPO size ranges from $694 million to $869 million.
There has been a mini-drought of quality IPOs in Korea in recent months and the IPO of SK Shieldus would be the biggest IPO in Korea since LG Energy Solution.

Before it’s here, it’s on Smartkarma

Apr 01

Equity Capital Markets: FWD Group Holdings, Paladin Energy, Guanze Intelligent Medical Information Industry Holding, V3 Brands Asia and more

In today’s briefing:

FWD Pre-IPO – Updates from HK Filings, Trends Remain as Confusing as Ever
Paladin Energy Placement – Slightly Speculative but Momentum Has Been Strong
Pre-IPO Guanze Intelligent Medical Information Industry – Advantages in Shandong Cannot Hide Worries
V3 Brands Asia Pre-IPO – The Negatives – While Margins Have Grown, so Have Payouts to Founder

FWD Pre-IPO – Updates from HK Filings, Trends Remain as Confusing as Ever

FWD, a pan-Asian life insurer founded by Richard Li, now aims to raise over US$1bn in its HK IPO after having tried to list in the US last year.
FWD is a pan-Asia life insurer operating in ten markets including Hong Kong (and Macau), Thailand (and Cambodia), Japan, the Philippines, Indonesia, Singapore, Vietnam and Malaysia.
In this note, we will talk about the updates from the HK filing.

Paladin Energy Placement – Slightly Speculative but Momentum Has Been Strong

Paladin Energy (PDN AU) aims to raise around US$150m (A$200m) via selling 277.8m new shares at A$0.72/per share, 8.9% discount to last close.
The proceeds will be geared towards restarting its Langer Heinrich Mine in Namibia and for funding working capital and fees.
In this note, we will talk about the firm’s track record and run the deal through our ECM framework.

Pre-IPO Guanze Intelligent Medical Information Industry – Advantages in Shandong Cannot Hide Worries

By Xinyao (Criss) Wang

Guanze relies heavily on sale of medical imaging film products in Shandong Province, and occupies a leading market position in Shandong based on its accumulation in local networks and resources.
However, the market size in Shandong is limited, with growth ceiling.With the trend of new technology and unproven ability to expand nationwide,there’s a risk of being eliminated in long term.
In this context, Guanze could face a lot of challenges and uncertainties. Therefore, we are conservative about the Company’s outlook at the current stage.

V3 Brands Asia Pre-IPO – The Negatives – While Margins Have Grown, so Have Payouts to Founder

V3 Brands Asia (V3 HK) is looking to raise about US$500m in its upcoming Hong Kong IPO. It was previously listed on the SGX between 2000-2016.
V3 Brands Asia is a lifestyle and wellness firm, it is most known for its flagship massage chairs which are sold under the OSIM brand.
In this note, we’ll talk about the not so positive aspects of the deal.

Before it’s here, it’s on Smartkarma

Mar 31

Equity Capital Markets: Air New Zealand, Jiangsu Recbio Technology, Ferretti SpA, V3 Brands Asia and more

In today’s briefing:

Air New Zealand Rights and Possible Shortfall – Delayed Boarding but Its Priced to Fly
RecBio (江苏瑞科) IPO Trading: Fairly Valued for Vaccine Hype
Ferretti IPO Trading: Weak Demand and High Share Concentration
V3 Brands Asia Pre-IPO – The Positives – Margins and Revenue Have Grown

Air New Zealand Rights and Possible Shortfall – Delayed Boarding but Its Priced to Fly

Air New Zealand (AIR) aims to raise around US$827m (NZ$1.2bn) via a renounceable rights issue.
The deal has been in the works for months and has been put off multiple times before owing to COVID-19 induced New Zealand (NZ) lockdowns.
In this note, we will run the deal through our ECM framework and talk about the recent updates.

RecBio (江苏瑞科) IPO Trading: Fairly Valued for Vaccine Hype

By Ke Yan, CFA, FRM

Jiangsu RecBio raised HKD 672m (USD 86m) from its global offering and will list on the Hong Kong Stock Exchange on Thursday, March 31st.
In the previous note, we looked at the company’s core products, including its HPV portfolio and the COVID-19 vaccine.
In this note, we provide an update for the IPO before trading debut.

Ferretti IPO Trading: Weak Demand and High Share Concentration

By Ke Yan, CFA, FRM

Ferretti raised HKD 1,771million (USD 226m) from its global offering and will list on the Hong Kong Stock Exchange on Thursday, Mar 31st.
In our previous note, we looked at the company’s key product segments, operating metrics, financials, and industry. We also compared the company with a close peer.
In this note, we provide an update before trading debut.

V3 Brands Asia Pre-IPO – The Positives – Margins and Revenue Have Grown

V3 Brands Asia (V3 HK) is looking to raise about US$500m in its upcoming Hong Kong IPO. It was previously listed on the SGX between 2000-2016.
V3 Brands Asia is a lifestyle and wellness firm, it is most known for its flagship massage chairs which are sold under the OSIM brand.
It has also recorded a bounce back post-COVID as average revenue per store surged. Margins have expanded as well owing to operating leverage and the firm’s partnership with Daito-OSIM.

Before it’s here, it’s on Smartkarma

Mar 30

Equity Capital Markets: Belle International Holdings and more

In today’s briefing:

Belle Fashion Pre-IPO – The Positives – Try Walking in My Shoes
Belle Fashion Pre-IPO – The Negatives – You’ll Stumble in My Footsteps

Belle Fashion Pre-IPO – The Positives – Try Walking in My Shoes

Belle Fashion (BF) aims to raise around US$1bn in its Hong Kong listing, which would mark its return to the stock market after five years.
Belle Fashion is the largest China-based fashion footwear and apparel group based on 2020 retail sales value, according to Frost & Sullivan (F&S).
In this note, we will talk about the positive aspects of the deal.

Belle Fashion Pre-IPO – The Negatives – You’ll Stumble in My Footsteps

Belle Fashion (BF) aims to raise around US$1bn in its Hong Kong listing, which would mark its return to the stock market after five years.
Belle Fashion is the largest China-based fashion footwear and apparel group based on 2020 retail sales value, according to Frost & Sullivan (F&S).
In this note, we’ll talk about the not so positive aspects of the deal.

Before it’s here, it’s on Smartkarma