In today’s briefing:
- Renesas (6723) – Denso Selldown Starts; Fourth Large Renesas Block in 6mos (Two More To Come)
- Renesas Block – While Not Particularly Well Flagged, Recent Selldowns in the Stock Have Done Well
- Shift Up IPO Preview
- Novelis Pre-IPO – Leader in Most Categories, Although End Markets’ Aren’t Really Growing Much
- Pre-IPO China Resources Beverage – Here Are the Concerns and the Risks Behind
- Shulan Health Management Pre-IPO – Still Ramping up but Only a Small Player
- Citicore Renewable Energy IPO – Needs a Wider Discount to Be Attractive
Renesas (6723) – Denso Selldown Starts; Fourth Large Renesas Block in 6mos (Two More To Come)
- Today post-close, Denso Corp (6902 JP) (via BofA) announced a selldown of 78,127,800 shares of Renesas Electronics (6723 JP). This is the latest in a line of block exits.
- There was the 130mm offering in November last year by INCJ. There was 123mm shares in Jan 2024 by NEC and Hitachi. A month later, 50mm shares from Mitsubishi Electric.
- In general, they have been absorbed, but one hasn’t needed to buy in the market. Some have broken price. Here, the pricing range is aggressive.
Renesas Block – While Not Particularly Well Flagged, Recent Selldowns in the Stock Have Done Well
- Denso Corp (6902 JP) is looking to raise US$1.39bn from selling a portion of its stake in Renesas Electronics (6723 JP).
- DENSO’s selldown is a small one at just 4.3 days of ADV. While there is an overhang of around 4% of TSO, DENSO will be locked up for 270 days.
- In this note, we will talk about the placement and run the deal through our ECM framework.
Shift Up IPO Preview
- Shift Up (462870 KS) is getting ready to complete its IPO in KOSPI in June 2024. Established in 2013, Shift Up is one of the leading game developers in Korea.
- The IPO price range is 47,000 won to 60,000 won. The IPO offering amount is 340.8 billion won to 435 billion won.
- According to the bankers’ valuation, the market capitalization range of the company ranges from 2.73 trillion won to 3.4 trillion won. This is the second largest IPO in Korea YTD.
Novelis Pre-IPO – Leader in Most Categories, Although End Markets’ Aren’t Really Growing Much
- Novelis Corporation (0620365D US) Novelis is looking to raise US$1.2bn in its upcoming US IPO. The firm is owned by Indian-listed Hindalco. The deal will consist of 100% secondary shares.
- Novelis is a global provider of aluminum solutions for the beverage packaging, automotive markets, specialties markets and aerospace.
- In this note, we look at the firm’s past performance.
Pre-IPO China Resources Beverage – Here Are the Concerns and the Risks Behind
- Over 92% of CR Beverage’s revenue is from packaged drinking water products, but YoY growth this business is already below industry CAGR, raising concerns about whether future growth will stall.
- The revenue scale/profitability of CR Beverage are far inferior to Nongfu Spring. In terms of cost control, operational efficiency and the strength of supply chain, CR Beverage is lagging behind.
- For low-priced packaging water, the nationwide expansion is not a simple task, which will lead to significant cash outflow. Valuation of CR Beverage should be lower than that of peers.
Shulan Health Management Pre-IPO – Still Ramping up but Only a Small Player
- Shulan Health Management (1807987D CH) is looking to raise around US$150m in its Hong Kong IPO.
- Shulan Health Management (SHM) is a technology-driven healthcare group in China that integrates healthcare services and medical research and education.
- In this note, we talk about the firm’s historical performance.
Citicore Renewable Energy IPO – Needs a Wider Discount to Be Attractive
- Citicore Renewable Energy (CREC PM) is looking to raise around US$120m in its Philippines IPO.
- Citicore Renewable Energy (CREC) is a pure-play renewable energy platform focused on developing and operating renewable energy projects in the Philippines.
- We looked at the firm’s past performance in an earlier note. In this note, we will share our thoughts on valuation.
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