In today’s briefing:
- LG Energy IPO Lock-Up – Last of the Lockups at US$3bn
- Anycolor (5032) Overseas Offering – Pre-IPO VCs Selling This High Growth Name
- StubWorld: CPALL Trading “Cheap” To MAKRO
- Fengxiang (9977 HK): Delisting Resolution Fails, MGO Closes 1 February
- Brilliance China: Special Dividend Amount Disappoints, but More Could Be on the Way
- Keepers: Thoughts on the Move Up, More to Come Easy Double from Here
- Calbee’s FY24 OP Is Bound to Exceed ¥30.0bn
- Seiyu Plans ¥100 Billion Investment
LG Energy IPO Lock-Up – Last of the Lockups at US$3bn
- LG Energy Solution (373220 KS) (LGES) raised US$10.8bn in its South Korea IPO, after pricing at the top-end of the IPO price range.
- The stock was listed on 27th Jan 22. Its one-year lockup is set to expire soon.
- In this note, we will talk about the lock-up dynamics and updates since our last note
Anycolor (5032) Overseas Offering – Pre-IPO VCs Selling This High Growth Name
- In late December, I wrote 2023 High Conviction – Anycolor (5032) Aiming at TSE Prime and TOPIX – And How!. Shares closed at ¥6,470 that day. Then went to ¥5,500.
- They have since rebounded some, and now 3 pre-IPO VC investors have announced an overseas offering. This was NOT unexpected. They need more shares to get their TSE Prime listing.
- The Offering is 3.27mm shares which is 5-6 days of volume. This lifts the TSE Prime inclusion amount, eventually, but the story is still about growth and model.
StubWorld: CPALL Trading “Cheap” To MAKRO
- 7-11 play CP ALL PCL (CPALL TB) is coming up “cheap” on my monitor versus cash & carry subsidiary Siam Makro Public (MAKRO TB).
- Preceding my comments on CPALL/MAKRO are the current setup/unwind tables for Asia-Pacific Holdcos.
- These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation >20%.
Fengxiang (9977 HK): Delisting Resolution Fails, MGO Closes 1 February
- Shandong Fengxiang (9977 HK)‘s delisting resolution was overwhelmingly voted against by independent H Shareholders. The results were not helped by the poor turnout.
- PAG’s MGO at HK$1.5132 per H Share is not conditional on the approval of the delisting resolution. The MGO remains open with a final closing date of 1 February.
- PAG currently holds 85.44% of the outstanding shares. At the last close and for a 10 February payment, the gross and annualised spread is 1.6% and 28.9%, respectively.
Brilliance China: Special Dividend Amount Disappoints, but More Could Be on the Way
- HK$0.96 per share special dividend announced last Friday disappointed the market.
- The dividend implies only 20% of the cash on the balance sheet paid out in dividends
- We think there could be 1-2 more special dividends in 2023E given lack of obvious uses for the cash balance
Keepers: Thoughts on the Move Up, More to Come Easy Double from Here
- The Keepers Holdings (KEEPR PM) recent move of +24% (3 months) was catalyzed by the dividend payout ratio (to 50%) increase and a solid Q4 2022 on the cards.
- Post the move, the stock trades at 8.4x/6.6x FY22/23e. The dividend yield for FY23e/FY24e is 6.0%/7.6% ( based on a 50% payout). 8% of the market cap is net cash.
- We expect the next catalyst to be when the company reports its earnings ( probably the second week of April 2023).
Calbee’s FY24 OP Is Bound to Exceed ¥30.0bn
- Japan’s largest snacks maker, Calbee Inc (2229 JP) has raised prices by 10-20% for almost 75% of its product range.
- Meanwhile, main inputs such as potatoes and palm oil have seen extensive price drops in the past few months.
- With margin pressures alleviating from both angles (revenue & cost), we think Calbee’s FY24 OP is bound to exceed ¥30.0bn.
Seiyu Plans ¥100 Billion Investment
- Rakuten only has a 15% stake in Seiyu, alongside majority shareholder, KKR, but the pivot by Seiyu post-acquisition shows the potential for Rakuten in this sector.
- Building on the 5 year plan that it set out in 2021, Seiyu last month announced a ¥100 billion in investment over the next 5 years.
- Funds will be used to increase integration with Rakuten’s online supermarket, with the aim to become the biggest GMS retailer.
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