ECM Daily Briefs | Page 81 of 118

In today’s briefing:

Huitongda (汇通达) IPO Trading – Subscription Rates and Cornerstone Quality Leaves Much to Be Desired

Huitongda (汇通达) IPO Trading – Subscription Rates and Cornerstone Quality Leaves Much to Be Desired

Huitongda (9878 HK) raised around US$285m in its Hong Kong IPO.
Overall, we are not comfortable with paying a premium valuation for HTD given its small scale of operations in a highly competitive and fragmented market.
In this note, we will look at the trading dynamics and current valuation.

Before it’s here, it’s on Smartkarma

Feb 16

Equity Capital Markets: Persol Holdings, Linmon Media, Emcure Pharmaceuticals, Vedant Fashions, Biocytogen Pharmaceuticals (Beijing) and more

In today’s briefing:

Persol Holdings Placement – Selldown by Cross-Shareholder
Linmon Media (柠萌影业) Pre-IPO – Consistently Putting up a Good Show
Emcure Pharmaceuticals Pre-IPO – Proforma Earnings Were Strong but It Faces a Host of Legal Issues
Vedant Fashions IPO Trading – Liked by Instis While Retail Gave It a Miss
Pre-IPO Biocytogen Pharmaceuticals – The Novel Development Model Offset the Pipeline’s Shortcomings

Persol Holdings Placement – Selldown by Cross-Shareholder

Kelly Services Inc A (KELYA US) aims to raise around US$200m via selling its 3.8% stake in Persol Holdings (2181 JP).
Kelly Services mentioned that it was looking to end its cross-shareholding with Persol Holdings in its earnings announcement. The two share a JV in PersolKelly.
In this note, we will run the deal through our ECM framework and comment on other deal dynamics.

Linmon Media (柠萌影业) Pre-IPO – Consistently Putting up a Good Show

Linmon Media (LM HK) is looking to raise about US$300m in its upcoming Hong Kong IPO.
Linmon Media (LM) is a content production firm that operates the full value chain of investment, production, distribution, promotion and derivatives licensing of drama series.
In this note, we take a look at LM’s business, financials, and share our thoughts on the IPO.

Emcure Pharmaceuticals Pre-IPO – Proforma Earnings Were Strong but It Faces a Host of Legal Issues

Emcure Pharmaceuticals Limited is looking to raise around US$500m in its upcoming India IPO.
EP is an Indian Pharmaceutical company engaged in the developing, manufacturing and globally marketing a broad range of pharmaceutical products across several major therapeutic areas.
In this note, we talk about the various aspects of the deal.

Vedant Fashions IPO Trading – Liked by Instis While Retail Gave It a Miss

Vedant Fashions raised around US$420m in its India IPO. While insti demand was decent, retail investor gave it a miss.
It is a fashionwear company targeting the Indian wedding and celebration wear segment. According to CRISIL, it was the largest company in India in the men’s Indian wedding wear segment.
In this note, we will talk about the trading updates and other deal dynamics.

Pre-IPO Biocytogen Pharmaceuticals – The Novel Development Model Offset the Pipeline’s Shortcomings

By Xinyao (Criss) Wang

The candidates in Biocytogen’s pipeline do not have advantages in development progress and also have to face fierce competition, so continuous large R&D investment in the future would be inevitable.
However, the development model of Biocytogen is very novel and special, which could make it a rare target in the market if it is successfully listed.
Therefore, the certainty of Biocytogen’s future growth is expected to improve gradually, and the mid- and long-term investment value would continue to increase due to the high moat.

Before it’s here, it’s on Smartkarma

Feb 09

Equity Capital Markets: Mitsubishi Estate Logistics, Adani Wilmar, GoGoX Holdings, Lepu Biopharma, Krafton Inc and more

In today’s briefing:

Mitsubishi Estate Logistics Placement – Annual Routine
Adani Wilmar IPO Trading – Listing Sentiment Isn’t the Greatest
GOGOX IPO Initiation: A Less than Perfect Delivery
Lepu Biopharma IPO: PHIP Updates
Krafton IPO Lock-Up Expiry – Few IPO Shares, More from Pre-IPO Investors

Mitsubishi Estate Logistics Placement – Annual Routine

Mitsubishi Estate Logistics (3481 JP) (MEL) is looking to raise US$203m to acquire two new properties.
The properties are expected to be more accretive to DPU than its last year’s placement, the deal has also been well-flagged and MEL has made capital raise an annual routine.
In this note, we will look at the assets to be acquired, impact on forecast and portfolio, and run the deal through our framework.

Adani Wilmar IPO Trading – Listing Sentiment Isn’t the Greatest

By Shifara Samsudeen, ACMA, CGMA

Adani Wilmar (6596700Z IN) raised around US$500m in its India IPO.
Anchor quality wasn’t the greatest, in our view, and were the firm to trade towards its peers’ trailing average, it would imply a 21.8% downside potential.
In this note we will talk about the subscription levels and trading dynamics.

GOGOX IPO Initiation: A Less than Perfect Delivery

By Arun George

GoGoX Holdings (GOGO HK) is a major online intra-city logistics platform in Asia. It is pre-marketing an HKEx IPO to raise US$200 million, according to press reports.
The fundamentals are unattractive as intensifying competition is pressuring growth, increasing losses and spurring cash burn.
As the losses and cash burn is expected to persist over the next three years, we would give the IPO a pass.

Lepu Biopharma IPO: PHIP Updates

Lepu Biopharma (LBP HK) is a biopharmaceutical company focusing on oncology therapeutics. The company has filed for an IPO to list on the Hong Kong Stock Exchange.
Lepu has the leading ADC candidate pipeline in China, in terms of number of clinical-stage ADC drug candidates. In our previous insight, we discussed the company’s business, products and outlook.
In this follow-up insight, we have highlighted and discussed some of the key new data points from the company’s Post Hearing Information Pack (PHIP).

Krafton IPO Lock-Up Expiry – Few IPO Shares, More from Pre-IPO Investors

By Zhen Zhou, Toh

Krafton Inc (259960 KS) raised about US$3.8bn in its South Korea IPO and its six month lock-up expires on 10th February.
Krafton Inc is a video game developer based in South Korea. The company is known for developing the global hit, PlayerUnknown’s Battlegrounds (PUBG), an online multiplayer battle royale game.
It is backed by Tencent and has also developed other games such as Tera, Elyon, Golf King: World Tour, Mini Golf King, Bowling King, and Archery King.

Before it’s here, it’s on Smartkarma

Feb 08

Equity Capital Markets: Huitongda, MicroPort NeuroTech and more

By Shifara Samsudeen, ACMA, CGMA

In today’s briefing:

Huitongda IPO – Valuation
MicroPort NeuroTech IPO: Impressive Product Portfolio Offsets Profitability Concerns

Huitongda IPO – Valuation

By Oshadhi Kumarasiri

With churn rates as high as 50% and wholesale customers declining by 27.7% in 9M21, we are not particularly interested in Huitongda (9878 HK) over long term.
The valuation looks cheap compared to peers on the surface, but when compared after considering Huitongda’s 1P exposure its at a significant premium to peers.
Given that the market takes time to pick up similar mispricing situations, we think its advisable to wait and see where Huitongda opens, before arranging a short position.

MicroPort NeuroTech IPO: Impressive Product Portfolio Offsets Profitability Concerns

MicroPort is the largest Chinese neuro-interventional medical device company and has filed for an IPO on the Hong Kong Stock Exchange. Its Portfolio consists of 30 commercialised products and candidates.
Although struggling with margins, the company has an impressive product portfolio with a majority of them having strong competitive advantages.
As most of the products are poised for growth, we are largely positive on the company.

Before it’s here, it’s on Smartkarma

Feb 06

Equity Capital Markets: Meihua International Medical Technologies and more

In today’s briefing:

Meihua International Medical Technologies Pre-IPO: Risks Overshadow Cheap Valuation

Meihua International Medical Technologies Pre-IPO: Risks Overshadow Cheap Valuation

By Tina Banerjee

China-Based medical devices company, Meihua International Medical Technologies intends to raise $50 million from its U.S. IPO by offering 5 million shares at price between $9 and $11 per share.
Upon the completion of this offering, the company will have 25 million shares outstanding. At the midpoint of offer price, Meihua will command a market capitalization of $250 million.
Despite attractive valuation, investors can avoid the IPO due to its unimpressive financial performance and concerns over Chinese companies listing in the U.S. market.

Before it’s here, it’s on Smartkarma

Feb 04

Equity Capital Markets: Turo and more

In today’s briefing:

Turo IPO Preview: The Largest Car Sharing Marketplace in the World

Turo IPO Preview: The Largest Car Sharing Marketplace in the World

By Douglas Kim

Established in 2010, Turo has become the largest car sharing marketplace in the world. It is attempting to complete its IPO in a turbulent IPO market.
Turo’s sales and profit growth skyrocketed in 2021. Its sales jumped by 206.5 YoY to reach $330.5 million in 1Q-3Q 2021.
Since the company’s inception, hosts have earned more than $1.1 billion in aggregate on its platform.

Before it’s here, it’s on Smartkarma

Feb 02

Equity Capital Markets: Huitongda, Enovix Corp, Vedant Fashions, HeMo Bioengineering and more

In today’s briefing:

Huitongda (汇通达) IPO – Not the Right Price
Enovix (ENVX) Is a Speculative Company with a Big Amount of Stock that Recently Unlocked.
Vedant Fashions IPO – Dominant Position in a Small Niche but Appears Pricey
Pre-IPO HeMo Bioengineering – Insights on Industry, Business and Concerns

Huitongda (汇通达) IPO – Not the Right Price

Huitongda (9878 HK) is looking to raise up to US$318m in its Hong Kong IPO.
Huitongda (HTD) is a leading commerce and service platform serving businesses in the lower-tier retail markets of China.
In this note, we will look at deal dynamics, assumptions, and share our thoughts on valuation.

Enovix (ENVX) Is a Speculative Company with a Big Amount of Stock that Recently Unlocked.

By Robert C Prather Jr

There is lots of competition for Li-Ion batteries and also for silicon anode Li-Ion batteries
Enovix is a going concern and has a material internal control weakness
With facilities that need to be built, lacking firm contracts with customers/suppliers, and unfinished products, lots of things need to go perfectly.

Vedant Fashions IPO – Dominant Position in a Small Niche but Appears Pricey

Vedant Fashions is looking to raise up to US$420m in its India IPO.
It is a fashionwear company targeting the Indian wedding and celebration wear segment. According to CRISIL, it was the largest company in India in the men’s Indian wedding wear segment.
In this note, we will run the deal through our ECM framework and talk about the deal background.

Pre-IPO HeMo Bioengineering – Insights on Industry, Business and Concerns

By Xinyao (Criss) Wang

It is worth rejoicing that HeMo Bioengineering (HMB HK) has entered commercialization stage, but some of the key products are in-licensed from other companies, not self-developed.
In front of fierce competition and policy impact, how to establish its high moat in R&D, innovation and commercialization capability would be the key factors to support long-term development.
Our view is that opportunities coexist with challenges, and investors should also pay attention to the market sentiment towards new IPOs at that time.

Before it’s here, it’s on Smartkarma

Feb 01

Equity Capital Markets: Vedant Fashions, Shanghai NewMed Medical and more

In today’s briefing:

Vedant Fashions IPO: Regal Ware Deserves a Premium. India’s Leading Men’s Ethnic Apparel Brand Play.
Pre-IPO Shanghai NewMed Medical – Concerns on Fierce Competition and Future Commercialization

Vedant Fashions IPO: Regal Ware Deserves a Premium. India’s Leading Men’s Ethnic Apparel Brand Play.

By Devi Subhakesan

Vedant Fashions, owner of India’s leading homegrown brand for premium ethnic wear for men – Manyavar, will launch its IPO on Feb 4th at a price range of Rs824-866/share.
The USD420 mn IPO suggests an equity valuation of USD2.8 bn implying forward P/E of around 70X at a premium to apparel peers but in line with consumer good companies.
The rapid growth in demand for premium ethnic-branded-wear for men have helped Vedant Fashions emerge as a segment leader with a pan India presence and attractive growth outlook.

Pre-IPO Shanghai NewMed Medical – Concerns on Fierce Competition and Future Commercialization

By Xinyao (Criss) Wang

From Shanghai NewMed Medical (NMM HK)’s pipeline, it can be seen that almost all the candidates do not have obvious advantages in development progress in front of the competing products.
NewMed has little experience in launching and commercializing product candidates, especially as a late-comer. So, the actual commercialization performance could be lower than expected.
Since there are so many uncertainties as well as the poor market sentiment for new IPOs in HKEX, we are conservative about the outlook of NewMed at the current stage.

Before it’s here, it’s on Smartkarma

Jan 31

Equity Capital Markets: Recruit Holdings, Samsung Biologics Co., and more

By Shifara Samsudeen, ACMA, CGMA

In today’s briefing:

Recruit Buyback: An Attempt to Rescue Falling Share Price; Seems Like a Good Short
Samsung Biologics Offering: Deal Summary & Trading Dynamics

Recruit Buyback: An Attempt to Rescue Falling Share Price; Seems Like a Good Short

Recruit has announced a share buy-back on Friday of 34.0m shares (2.06% of outstanding shares) for JPY155.8bn, implying JPY4,581 per share.
Recruit’s shares closed at JPY5,090 per share at the end of Thursday’s close, and following the announcement, shares moved up to JPY5,305 a piece, gaining 4.2%.
We think Recruit’s shares will be a good Short over the next few days.

Samsung Biologics Offering: Deal Summary & Trading Dynamics

By Sanghyun Park

Samsung Biologics announced that it would purchase all 10,341,852 shares of Samsung Bioepis owned by Biogen for ₩2.77T. For this, it also announced a ₩3T new share issuance.
The discount rate is 15%, tighter than the usual 20%. Despite that, this offering still deserves attention from an arb perspective as we may see more forfeited shares than expected.
Entry timing? I’ll aim at the rights trading window. As a short hedge, I will look at C&T, which is expected to have a higher price synch rate with Biologics.

Before it’s here, it’s on Smartkarma

Jan 28

Equity Capital Markets: LG Energy Solution, Aquila Acquisition Corporation and more

In today’s briefing:

LG Energy: MSCI & FTSE Fast Entry Results & Passive Flows Schedule Update
Aquila Acquisition Corporation Tear Sheet – Aiming to Be Hong Kong’s First SPAC Listing

LG Energy: MSCI & FTSE Fast Entry Results & Passive Flows Schedule Update

By Sanghyun Park

MSCI announced LG Energy’s Fast Entry. The effective date is February 15. As a result, rebalancing trading will take place on February 14.
FTSE Fast Entry failed. As a result, LG Energy will be included in the FTSE AW in June, the first index review after the 3-month minimum listing period.
LG Energy’s share price fluctuations are highly likely to occur in multiple phases until the inclusion of the KOSPI 200 on March 10.

Aquila Acquisition Corporation Tear Sheet – Aiming to Be Hong Kong’s First SPAC Listing

Aquila Acquisition Corporation (AAC) aims to raise around US$300m via Hong Kong’s first SPAC listing.
AAC is promoted by CMB International Asset Management Limited (CMBIAM) and AAC Mgmt Holding Ltd (AACMH).
In this tear sheet, we will talk about the deal background and structure.

Before it’s here, it’s on Smartkarma