Daily Brief China: Tian Tu Capital, Beneunder, Innovent Biologics Inc, Lenovo and more

• Tian Tu Capital (1390587D CH) is looking to raise about US$500m in its upcoming Hong Kong IPO. The deal will be run by JP Morgan and Huatai International.
• Tian Tu Capital is a private equity investor that invests in Chinese consumer brands/companies, managing capital for institutional investors and high-net worth individuals.  
• Among the 205 portfolio companies it had invested in up to FY21 (Dec 31, 2021), 23 of them had reached a valuation of US$1bn at that date. 

• Beneunder Limited (BL) aims to raise around US$500m in its Hong Kong IPO.
• According to CIC, it was the largest sunprotection apparel brand in China in terms of both total retail sales value and online retail sales value with 5.0% and 12.9% marketshare. 
• In this note, we will talk about the positive aspects of the deal.

• Innovent is expected to transform from a biotech to a biopharma. From the present point of view, the Company is a better comprehensive choice of certainty, elasticity and safety.  
• With high R&D efficiency, strong sales capability, top talent teams, and mindset keeping pace with the times, investors could consider to replace Hengrui with Innovent in the portfolio.  
• Innovent’s valuation anchor is HK$40 billion, below which it’s undervalued. Its market value could reach about RMB80 billion to RMB120 billion, based on sales of RMB10 billion to RMB15 billion. 

Lenovo has launched a roadshow to market dual-tranche 144A/RegS bond offerings of 5.5Y and 10Y. The 10Y notes will be the company’s first green bonds, while the 5.5Y bonds will be conventional notes. Proceeds from the green bonds will be used to finance or refinance eligible projects, including green buildings and renewable energy initiatives. 

Lenovo also launched a concurrent tender offer for the USD 4.75 23 notes, of which USD 687 mn is outstanding. The tender offer price is USD 1,005 per USD 1,000 principal. The consideration will include accrued interest. The tender cap will be determined and announced on or around July 22nd, after the company has priced the notes offerings.

Initial price guidance was announced earlier today, as follows: 5.5Y: CT5 + 290 bps, and 10Y: CT10 + 370 bps. We find this fair, in view of the existing LENOVO curve and taking into account global peers HPQ and DELL.

• Beneunder Limited (BL) aims to raise around US$500m in its Hong Kong IPO.
• According to CIC, it was the largest sunprotection apparel brand in China in terms of both total retail sales value and online retail sales value with 5.0% and 12.9% marketshare. 
• In this note, we will talk about the not-so-positive aspects of the deal.

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

• China South City
• Lenovo