In today’s briefing:
- Kokusai Electric IPO – Don’t Worry, This’ll Be Fine Too
- Cainiao Pre-IPO – The Postivies – Evolving into a Global Player, Decent Revenue Growth
- Cainiao Smart Logistics IPO: Lacks Viability as a Standalone Business
- 4Paradigm IPO: Thoughts on First Day Trading
- 4Paradigm IPO Trading – Low Insti Subscription and Small Float
Kokusai Electric IPO – Don’t Worry, This’ll Be Fine Too
- Early last year there were articles suggesting that KKR would IPO Kokusai Electric at a valuation of about ¥700bn.
- A year plus later the company is now set to IPO for something on the order of ¥436bn.
- We are sure KKR is breathing a sigh of relief that they didn’t unload shares 60% higher and can now offer other investors some “value”.
Cainiao Pre-IPO – The Postivies – Evolving into a Global Player, Decent Revenue Growth
- Cainiao Smart Logistics , Alibaba Group Holding (9988 HK)’s logistics linked arm, is planning to raise at least US$1bn in its Hong Kong IPO.
- Cainiao is the largest provider of cross-border e-commerce logistics services globally and a leader in China logistics services, according to CIC.
- In this note, we talk about the positive aspects of the deal.
Cainiao Smart Logistics IPO: Lacks Viability as a Standalone Business
- Alibaba (ADR) (BABA US)‘s logistics arm, Cainiao Smart Logistics (1437124D HK), filed for an IPO with HKEX yesterday, aiming to raise $1bn to $2bn.
- Although efficient, Cainiao may face business challenges, as the majority of logistics costs and revenues stem from services outsourced to logistics partners.
- Despite the proposed IPO, we believe that Cainiao will always operate in the shadow of Alibaba’s primary e-commerce business.
4Paradigm IPO: Thoughts on First Day Trading
- 4Paradigm has priced its IPO at HK$55.60 per share, at the bottom end of the indicative IPO price range of HK$55.6-61.16 per share and raised net proceeds of HK$835.5m.
- The HK offering and the international offering of the company were oversubscribed by 11.4x and 1.57x respectively implying very moderate demand for the company’s shares.
- Though priced at the bottom of the indicative IPO price range, our analysis suggests that 4Paradigm’s IPO is still expensive.
4Paradigm IPO Trading – Low Insti Subscription and Small Float
- 4Paradigm (6682 HK) raised around US$131m in its Hong Kong IPO.
- 4P is a platform-centric AI enterprise solutions provider. It was the largest player by revenue in the platform-centric decision-making AI market in China in 2022, as per CIC.
- We have covered various aspects of the deal in our previous notes. In this note, we will talk about the demand and trading dynamics.
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