In today’s briefing:
- Oriental Land Co Placement – Relatively Small One to Digest, Overhang Might Not Be as Large
- Angel Robotics: IPO Valuation Analysis
- NLC India OFS – Another GoI-PSU Selldown, Well Flagged Coupled with Strong Momentum
- Shanghai REFIRE Group Pre-IPO Tearsheet
- Lianlian DigiTech IPO: PHIP Updates
Oriental Land Co Placement – Relatively Small One to Digest, Overhang Might Not Be as Large
- Keisei Electric Railway Co (9009 JP) is looking to raise up to US$553m from selling a 1% stake in Oriental Land (4661 JP).
- Palliser Capital, has been pushing Keisei Electric Railway to reduce its stake in OLC to unlock shareholder value owing to the wide discrepancy between carrying/market value of the former’s investment.
- Selling just 1% of shares outstanding, the deal wouldn’t be a very large one to digest, representing 4.7 days of OLC’s three month ADV.
Angel Robotics: IPO Valuation Analysis
- Our base case valuation of Angel Robotics is target price of 20,277 won per share, which represents a 35% upside from the high end of the IPO price range.
- We estimate sales of 9 billion won in 2024 (up 75.2% YoY) and 14.9 billion won in 2025 (up 65.3% YoY). Our estimates are more conservative than the company’s estimates.
- We like the strong sales growth of Angel Robotics. Many investors are likely to view this positively in this IPO. LG Electronics and Samsung Electronics are customers of Angel Robotics.
NLC India OFS – Another GoI-PSU Selldown, Well Flagged Coupled with Strong Momentum
- The GoI is looking to raise up to US$248m from selling its stake in Neyveli Lignite (NLC IN).
- This seems to be part of the GoI’s ongoing divestment drive across PSUs, with the recent selldowns in other PSUs having done well.
- The GoI had also sold some stake in the firm earlier in Oct 2017.
Shanghai REFIRE Group Pre-IPO Tearsheet
- Shanghai REFIRE Group (SRG) is looking to raise around US$100m in its upcoming Hong Kong IPO. The bookrunner for the deal is CICC.
- SRG designs, develops, manufactures, and sells hydrogen fuel cell systems, hydrogen production systems, and related components, as well as provides fuel cell engineering and technical services.
- According to Frost & Sullivan (F&S), it ranked first in the hydrogen fuel cell system market in China, with a market share of 25.9%.
Lianlian DigiTech IPO: PHIP Updates
- Lianlian DigiTech (2104619D CH), a digital payment services provider in China, has begun pre-marketing an HKEx IPO. It previously targeted a US$500 million raise.
- We previously discussed the IPO in LianLian DigiTech IPO: The Bull Case and LianLian DigiTech IPO: The Bear Case.
- The PHIP reinforces the bear case of operating losses, an unconvincing path to profitability, and a volatile FCF with a deteriorating balance sheet.
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