In today’s briefing:
- Ecopro Materials: Reduces IPO Price Range
- EcoPro Materials IPO: The Bear Case
- Ingenia Communities Placement – Largest Shareholder Selling Isn’t Particularly Well Flagged
Ecopro Materials: Reduces IPO Price Range
- Ecopro Materials reduced the upper end of the IPO price range from 46,000 won to 44,000 won.
- The bankers reduced the IPO discount, EV/EBITDA valuation multiple, and outstanding shares.
- We maintain our Bearish view of the Ecopro Materials IPO. Our base case valuation of 37,436 won per share is towards to lower end of the IPO price range.
EcoPro Materials IPO: The Bear Case
- EcoPro Materials (ECO123 KS) is a leading player in the electrode material industry. It is seeking to raise up to US$477 million in a KRX IPO.
- In EcoPro Materials IPO: The Bull Case, we highlighted the key elements of the bull case. In this note, we outline the bear case.
- The bear case rests on weakening sector market sentiment, margin pressure likely to persist, cash burn, elevated leverage and high related-party transactions.
Ingenia Communities Placement – Largest Shareholder Selling Isn’t Particularly Well Flagged
- Sun Communities (SUI US) is looking to raise A$165m (US$106m) via selling its entire stake in Ingenia Communities (INA AU).
- With the investor selling down its entire stake, the deal will be a large one for the firm to digest, with shares representing 32.9 days of three month ADV.
- While short covering could potentially provide some support for share price post-deal, the selldown here doesn’t seem particularly well flagged.
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