ECM Daily Briefs | Page 78 of 118

In today’s briefing:

JD.com Tencent Distribution Quick Update – Settlement Done. Shares Hit CCASS, but Not All Shares
Press Metals Aluminum Holdings Placement – Well Flagged Deal, Stock Has Done Well

JD.com Tencent Distribution Quick Update – Settlement Done. Shares Hit CCASS, but Not All Shares

On 23rd Dec 2021, Tencent declared a special interim dividend in the form of a distribution in specie of 457.326m Class A ordinary shares of JD.com.
While Tencent went ex-div on 20th Jan 2022, the actual settlement of the distribution is happened on 25th Mar 2022.
In this note, we talk about the updates since our last note and the actual number of shares in CCASS.

Press Metals Aluminum Holdings Placement – Well Flagged Deal, Stock Has Done Well

Press Metal Aluminum Holdings (PMAH) aims to raise around US$233m via a primary placement.
The stock has been doing well on the back of buoyant Aluminum prices over the past few months.
In this note, we will run the deal through our ECM framework and talk about the recent updates.

Before it’s here, it’s on Smartkarma

Mar 27

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

In today’s briefing:

ECM Weekly (27th Mar 2022) – JD, Tencent, Prosus, Ferretti, Recbio, Nomura, Navi, Samsung, Celltrion

ECM Weekly (27th Mar 2022) – JD, Tencent, Prosus, Ferretti, Recbio, Nomura, Navi, Samsung, Celltrion

Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
Placements were back with a bang this week with multiple blocks across the region. All eyes will be on JD.com Inc. (9618 HK) in the coming week.
Farm Fresh Berhad (FF MY)‘s IPO got off to a good start, while Hong Kong IPOs continue to be lackluster.

Before it’s here, it’s on Smartkarma

Mar 25

Equity Capital Markets: JD Logistics, aCommerce Group, Ferretti SpA and more

In today’s briefing:

JD Logistics Placement – Not Wholly Convinced, JD’s US$700m Support Helps
Acommerce Pre-IPO – Beneficiary of COVID However, Has Been Losing Market Share
Ferretti IPO: Peer Comparison and Valuation

JD Logistics Placement – Not Wholly Convinced, JD’s US$700m Support Helps

JD Logistics (JDL) aims to raise around US$1.1bn, with US$400m coming via an institutional placement. The balance will be funded by issuing shares at the same price to JD.com.
We have covered the stock extensively, links to our previous notes are below.
In this note, we will run the deal through our ECM framework and talk about the recent updates.

Acommerce Pre-IPO – Beneficiary of COVID However, Has Been Losing Market Share

ACommerce Group (ACOM TB) is looking to raise about US$200m in its upcoming Thailand IPO.
Acommerce is an ecommerce enabler providing end-to-end and ala carte ecommerce solutions for brands in Southeast Asia (SEA).
Acommerce has been a key beneficiary of COVID, however, has been recording unexpectedly weak margins, suggesting that it does a lot of logistical heavy lifting.

Ferretti IPO: Peer Comparison and Valuation

Luxury Italian yacht maker Ferretti Group plans to raise US$248.4m at a market capitalisation of US$1.1bn and a post-money EV of US$807m at the midpoint of the IPO price range.
Ferretti’s revenues suffered with COVID-19 and ongoing issues such as the Ukraine-Russia war and China-US trade tensions would only put further pressure on the company.
We think Ferretti’s shares are fairly valued at the indicative IPO price range given the current volatility in the market, political turmoil and lack of investor confidence.

Before it’s here, it’s on Smartkarma

Mar 24

Equity Capital Markets: Lendlease Global Commercial REIT, GoTo, Bukalapak, JD.com Inc (ADR), Doosan Corp, Ruchi Soya Industries, Ferretti SpA and more

In today’s briefing:

Lendlease Global Offering to Buy the Rest of JEM – Big Deal, Cheap, Cheaper Than Peers
GoTo Vs Bukalapak Vs Grab Vs Sea
Bukalapak IPO Lock-Up – Scattered Shareholding Could Put Some Pressure on the Share Price
JD.com Tencent Distribution – Updates on the Now US$15bn Overhang and the Prosus Angle
Doosan Corp Placement – Large Deal but Price Momentum Has Been Solid
Ruchi Soya Placement – Almost Akin to a Relisting
Ferretti IPO: Things Have Gotten Worse Since Previous Attempt to List in Milan

Lendlease Global Offering to Buy the Rest of JEM – Big Deal, Cheap, Cheaper Than Peers

By Travis Lundy

In mid-February, Lendlease Global Commercial REIT (LREIT SP) which owned 31.8% of the Jurong East MRT Station “Jem” complex announced it would buy the rest.
They announced they would issue new equity to pay for some of it. Predictably, the units fell, and fell vs Office/Retail Mixed-Use SREIT peers.
Now you can buy units of Singapore asset quality, acceptable leverage, high divi and something well cheap of peer-measured fair.

GoTo Vs Bukalapak Vs Grab Vs Sea

By Arun George

GoTo (1379371D IJ) is the leading digital ecosystem in Southeast Asia. It has extended its book build for a $1.3 billion IPO to 24 March.
In GoTo Gojek Tokopedia IPO: Valuation Insights, we noted that our valuation analysis suggests that the price range is aggressive and unattractive.
In this note, we compare GoTo vs Bukalapak (BUKA IJ), Grab (GRAB US) and Sea Ltd (SE US)‘s relevant businesses across GTV, take rates and segmental margins.

Bukalapak IPO Lock-Up – Scattered Shareholding Could Put Some Pressure on the Share Price

Bukalapak (Buka) raised US$1.5bn in Aug 2021 when it priced its IPO at the top end of its pricing range.
Buka is an Indonesian e-commerce company. The company operates an online consumer-to-consumer (C2C) marketplace. It also operates Mitra Bukalapak (Mitra) which provides online-to-offline (O2O) services to MSMEs.
The pre-IPO shareholders will be released from the lockup on 6th April 2022.

JD.com Tencent Distribution – Updates on the Now US$15bn Overhang and the Prosus Angle

On 23rd Dec 2021, Tencent declared a special interim dividend in the form of a distribution in specie of 457.326m Class A ordinary shares of JD.com.
While Tencent went ex-div on 20th Jan 2022, the actual settlement of the distribution is expected to happen on or about 25th Mar 2022.
In this note, we talk about the updates since our last note and have a closer look at Prosus and its possible motivation/intention with its JD.com stake.

Doosan Corp Placement – Large Deal but Price Momentum Has Been Solid

Park Yong-maan, Park Seo-won and Park Jae-won are looking to sell down their stakes in Doosan Corp (000150 KS) . The share sale will be a cleanup.
In our view, the deal should bode well for the current management, giving them free rein in management coupled with the share sale being a clean-up.
In this note, we will talk about the firm’s track record and run the deal through our ECM framework.

Ruchi Soya Placement – Almost Akin to a Relisting

Ruchi Soya Industries (RSI IN) is looking to raise up to US$560m via a follow-on public offer.
The deal is almost akin to a relisting, as the free float was just at 1% prior to this deal.
Given the tight float, instead of discussing its track record , we will discuss the timeline of events leading up to the deal, past performance and undertake a peer comparison/valuation.

Ferretti IPO: Things Have Gotten Worse Since Previous Attempt to List in Milan

The Italian luxury yacht maker, Ferretti SpA (FER IM) , has filed for an IPO on the Hong Kong Stock Exchange and plans to raise net proceeds of around US$272m.
The company previously filed for an IPO in Milan in 2019 targeting a market value of around EUR1.8bn (US$1.2bn), which was scrapped claiming a “weak market”.
Ferretti’s revenues suffered with COVID-19 and ongoing issues such as the Ukraine-Russia war and China-US trade tensions would only put further pressure on the company.

Before it’s here, it’s on Smartkarma

Mar 23

Equity Capital Markets: Lendlease Global Commercial REIT, Nomura Research Institute Ltd, Life Insurance Corp of India (LIC), Navi, Top Glove Corp and more

In today’s briefing:

Lendlease Global REIT Placement – Very Well Flagged but Still Quite a Large One to Digest
Nomura Research Placement – Has Sold Before, Deal Might Be More Reflective on the Parent’s Results
LIC’s Share of a Stagnating Market Declines – Promised Growth of Insurance Penetration a Mirage?
Navi Technologies Pre-IPO – The Negatives – Still Very Much a Work-In-Progress
Pre-IPO Top Glove Corp – The Good Times Brought by COVID-19 Are Slipping Away

Lendlease Global REIT Placement – Very Well Flagged but Still Quite a Large One to Digest

Lendlease REIT is looking to raise up to US$427m via a private placement and a preferential offering.
The deal is very well flagged as the acquisition was announced in Feb 2022 and the EGM approval for the same was received earlier this month.
In this note, we will run the deal through our ECM framework and talk about the recent updates.

Nomura Research Placement – Has Sold Before, Deal Might Be More Reflective on the Parent’s Results

Nomura Holdings is looking to raise around US$486m via selling 2.5% of Nomura Research.
This is not the first sale by Nomura and hence, might not come as a complete surprise.
In this note, we will run the deal through our ECM framework and talk about the recent updates.

LIC’s Share of a Stagnating Market Declines – Promised Growth of Insurance Penetration a Mirage?

By Hemindra Hazari

Life insurance penetration (life insurance premium/GDP) stagnating in India for last decade
Entry of 23 private sector life insurance companies has not increased life penetration
The private players have got the more profitable end of the market, leaving LIC with the lower end. LIC itself, which once expanded the market, has lost direction.

Navi Technologies Pre-IPO – The Negatives – Still Very Much a Work-In-Progress

Navi Technologies (NT) aims to raise around US$500m in its India listing. NT was started by Sachin Bansal, co-founder of Flipkart which was sold to Walmart in 2018.
NT is a technology-driven financial products and services company. The company was only incorporated in 2018, it offers personal loans, home loans, general insurance and mutual funds.
In this note, we will talk about the not so positive aspects of the deal.

Pre-IPO Top Glove Corp – The Good Times Brought by COVID-19 Are Slipping Away

By Xinyao (Criss) Wang

Top Glove Corp (TOPG MK)’s strong performance was attributable to the unprecedented demand for glove products during the COVID-19 pandemic.
Judging from the past development, Top Glove is highly correlated with the global pandemic or virus both in terms of financial indicators and market value performance.
Therefore, although Top Glove would continue to be in the first echelon in this industry, investors should not expect too much from the Company’s performance after COVID-19 is under control.

Before it’s here, it’s on Smartkarma

Mar 22

Equity Capital Markets: Celltrion Inc, Samsung Sds, Farm Fresh Berhad, Ferretti SpA, Arrail Group, Jiangsu Recbio Technology, Navi and more

In today’s briefing:

Celltrion and Celltrion Health Placement – Past Deals Have Been Mixed
Samsung SDS Placement – Deal Is Very Well Flagged and the Stock Is Cheap, but It’s a Tough One
Farm Fresh IPO Trading – Solid Subscription, Should Come in at a Premium to Domestic Peers
Ferretti IPO: At Best Fairly Valued
Arrail Group (瑞尔集团) IPO Trading: Weak Demand, Rich Valuation
RecBio (江苏瑞科) IPO: Fairly Valued on Optimistic Industry Forecast
Navi Technologies Pre-IPO – The Positives – Sold the First for US$20bn, Now Building One Without VCs

Celltrion and Celltrion Health Placement – Past Deals Have Been Mixed

Temasek aims to raise around US$450m+ via selling 1.7% of Celltrion Inc (068270 KS) and Celltrion Healthcare (091990 KS) each.
We have looked at its two previous sell downs in 2018 and 2020.
In this note, we will run the deal through our ECM framework and talk about the recent updates.

Samsung SDS Placement – Deal Is Very Well Flagged and the Stock Is Cheap, but It’s a Tough One

Kookmin Bank Trust Department is looking to raise up to US$321m via selling 3.9% of Samsung SDS.
The deal appears to be very well flagged as the ultimate sellers are the Samsung family.
In this note, we will run the deal through our ECM framework and talk about the recent updates.

Farm Fresh IPO Trading – Solid Subscription, Should Come in at a Premium to Domestic Peers

Farm Fresh Berhad (FF MY) raised around US$239m in its Malaysia IPO.
In our view, the firm’s stronger margins and better growth potential warrants a premium to its other domestic peers.
In this note, we will talk about the updates since then and the trading dynamics.

Ferretti IPO: At Best Fairly Valued

Ferretti, a leading yacht builder based in Italy, started book building to raise up to USD 302m via a Hong Kong listing.
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 for the book building. We will run the deal through our ECM framework and provide an update on the deal.

Arrail Group (瑞尔集团) IPO Trading: Weak Demand, Rich Valuation

Arrail Group raised HKD 589.9 million (USD 75m) from its global offering and will list on the Hong Kong Stock Exchange on Tuesday, Mar 22nd.
In our previous notes, we looked at the company’s background, its operation, its financials, and its expansion plan, compared its key metrics with peers and provided thoughts on valuation.
In this note, we look at the updates since our last note and prior to debut.

RecBio (江苏瑞科) IPO: Fairly Valued on Optimistic Industry Forecast

RecBio is an innovative vaccine company with a focus on HPV vaccines. The company started book building to raise up to USD 98m via a Hong Kong listing.
In the previous note, we looked at the company’s core products, including its HPV portfolio and the COVID-19 vaccine and the valuation.
In this note, we provide an update for the book building. We will run the deal through our ECM framework and provide an update on the deal.

Navi Technologies Pre-IPO – The Positives – Sold the First for US$20bn, Now Building One Without VCs

Navi Technologies (NT) aims to raise around US$500m in its India listing. NT was started by Sachin Bansal, co-founder of Flipkart which was sold to Walmart in 2018.
NT is a technology-driven financial products and services company. The company was only incorporated in 2018, it offers personal loans, home loans, general insurance and mutual funds.
In this note, we will talk about the positive aspects of the deal.

Before it’s here, it’s on Smartkarma

Mar 21

Equity Capital Markets: GoTo and more

In today’s briefing:

GoTo IPO: A No Go
GoTo IPO: Peer Comparison and Valuation

GoTo IPO: A No Go

Superapp GoTo has filed for an IPO to list its shares on the Indonesian Stock Exchange to raise US$1.2bn at a market capitalisation of US$25.0bn.
The company plans to use most of the proceeds on developing its businesses including Gojek, Tokopedia and fintech services.
Our analysis on the company’s financials suggests the company has been burning cash to grow its business and may not be able to generate any profits in the near future.

GoTo IPO: Peer Comparison and Valuation

Superapp GoTo (1379371D IJ) has filed for an IPO to list its shares on the Indonesian Stock Exchange to raise US$1.1-1.25bn at a valuation of about US$24-26bn.
The company plans to use the proceeds to develop its business including for customer acquisition, product development and sales and marketing.
Our SOTP valuation implies that GoTo’s shares are overvalued at the indicative IPO price range.

Before it’s here, it’s on Smartkarma

Mar 20

Equity Capital Markets: GoTo, Tencent and more

In today’s briefing:

GoTo Gojek Tokopedia IPO: Valuation Insights
ECM Weekly (20th Mar 2022) – JD.com, Tencent, Prosus, GoTo, Ferretti, Green Tea, Recbio, Abacus

GoTo Gojek Tokopedia IPO: Valuation Insights

By Arun George

GoTo (1379371D IJ) is the leading digital ecosystem in Southeast Asia. It seeking to raise up to $1.3 billion. Bookbuilding ends on 21 March.
In GoTo Gojek Tokopedia IPO Initiation: Island Shopping, we noted that the fundamentals are mixed as the high growth is accompanied by ongoing losses and cash burn.
Our valuation analysis suggests that the price range is aggressive and unattractive. We would give the IPO a pass.

ECM Weekly (20th Mar 2022) – JD.com, Tencent, Prosus, GoTo, Ferretti, Green Tea, Recbio, Abacus

Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
GoTo (1379371D IJ) launched its bookbuild but decided to keep it local, with no international bookrunners.
Placements continue to trickle in with Abacus Property (ABP AU) managing to raise US$150m odd. All eyes will be on JD.com Inc. (9618 HK) in the coming week.

Before it’s here, it’s on Smartkarma

Mar 19

Equity Capital Markets: Softbank Group, Wiwynn Corp and more

In today’s briefing:

Softbank – Why We Think Arm Is Worth Less Than $10bn
Wiwynn Corp Placement – Selldown’s Timing Is Curious but Previous Deal Had Performed Well

Softbank – Why We Think Arm Is Worth Less Than $10bn

By Mio Kato

Softbank is apparently trying to garner a $50bn valuation for Arm at its IPO and secure $8bn in margin loans on the back of that.
We think that is a stretch though it is certainly not impossible that it would succeed.
However, in terms of real value we suspect Arm could be worth less than $10bn and articulate why below.

Wiwynn Corp Placement – Selldown’s Timing Is Curious but Previous Deal Had Performed Well

Wistron Corp (3231 TT) aims to raise around US$204m (NT$5.8bn) via selling 3.3% of its stake in subsidiary, Wiwynn Corp (6669 TT) . This would not be a clean-up.
The timing is curious given Wiwynn having just announced its plans to offer up to 17m new shares in a primary follow-on offer.
In this note, we will talk about the firm’s track record and run the deal through our ECM framework.

Before it’s here, it’s on Smartkarma

Mar 18

Equity Capital Markets: GoTo, Abacus Property, Jiangsu Recbio Technology and more

In today’s briefing:

GoTo IPO – Valuation – Missed the Tide, Boat Won’t Rise
Abacus Property Group Placement – Previous Deal Did Well, This One Won’t Be Accretive
RecBio (江苏瑞科) Pre-IPO: Thoughts on Valuation

GoTo IPO – Valuation – Missed the Tide, Boat Won’t Rise

GoTo aims to raise around US$1.25bn from a local listing, which will mainly be targeted at domestic investors.
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 will talk about the company’s valuation.

Abacus Property Group Placement – Previous Deal Did Well, This One Won’t Be Accretive

Abacus aims to raise around US$146m (A$200m) via issuing new shares worth 7.1% of issued shares.
The company will use the proceeds from the placement to pay down debt that it has accumulated from earlier acquisition/construction.
In this note, we will talk about the recent developments and run the deal through our ECM framework.

RecBio (江苏瑞科) Pre-IPO: Thoughts on Valuation

RecBio is an innovative vaccine company with a focus on HPV vaccines. The company is pre-marketing its USD 100-200 million Hong Kong listing.
In the previous note, we looked at the company’s core products, including its HPV portfolio and the COVID-19 vaccine. Though not impressive, it does provide exposure to China HPV market.
In this insight, we provide our thoughts on valuation, including key assumptions.

Before it’s here, it’s on Smartkarma