In today’s briefing:
- Rigaku Holdings (268A JP) IPO: The Bear Case
- Nanshan Aluminium International Pre-IPO Tearsheet
- Rigaku IPO – Peer Comparison – Compensating for Smaller Scale with Better Growth and Margins
- CR Beverage IPO: The Investment Case
- Chongqing Terminus Pre IPO Tearsheet
- Pre-IPO Sichuan Biokin Pharmaceutical – Would Investors Be Willing to Take a Gamble?
Rigaku Holdings (268A JP) IPO: The Bear Case
- Rigaku Holdings (268A JP) is Japan’s leading manufacturer of X-ray analysis, measurement and testing instruments. It is seeking to raise up to US$760 million.
- In Rigaku Holdings (268A JP) 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 forward growth indicators, China revenue risk, rising cash conversion cycles, mid-tier FCF margin and large post-IPO share overhang.
Nanshan Aluminium International Pre-IPO Tearsheet
- Nanshan Aluminium International Holdings (NAI HK) is looking to raise about US$500m in its upcoming Hong Kong IPO. The deal will be run by Huatai International.
- Nanshan Aluminium International is a leading alumina manufacturer in Southeast Asia.
- The firm’s primary focus has been tapping into Indonesia’s abundant bauxite and coal reserves, utilizing the low-temperature Bayer process to produce metallurgical-grade alumina in sand form.
Rigaku IPO – Peer Comparison – Compensating for Smaller Scale with Better Growth and Margins
- Rigaku Holdings (268A JP) is looking to raise US$762m in its Japan IPO.
- Rigaku engages in developing, manufacturing, sales and servicing scientific instruments specializing in X-ray technologies.
- In our earlier notes, we looked at the firm’s past performance. In this note, we undertake a peer comparison.
CR Beverage IPO: The Investment Case
- China Resources Beverage (CRB HK), China’s largest purified drinking water company, is premarketing an HKEx to raise US$0.5-1 billion.
- We previously discussed the IPO in CR Beverage IPO: The Bull Case and CR Beverage IPO: The Bear Case. In this note, we examine the latest updates in the PHIP.
- The investment case rests on core business offsetting slowing growth with margin improvement, beverage’s fast-paced growth, narrowing the margin gap with Nongfu Spring (9633 HK), and return to FCF generation.
Chongqing Terminus Pre IPO Tearsheet
- Chongqing Terminus (2471080D CH) is looking to raise about US$300m in its upcoming Hong Kong IPO. The deal will be run by CITIC Securities and Haitong.
- Chongqing Terminus is a leader and pioneer in China’s public realm AIoT (Artificial Intelligence of Things) industry.
- It leverages its innovative AIoT operating system, TacOS, to provide enterprises, public administrators and public realm participants with full stack AIoT products i.e. software, hardware and services. .
Pre-IPO Sichuan Biokin Pharmaceutical – Would Investors Be Willing to Take a Gamble?
- Biokin’s traditional chemical drug and TCM businesses would continue to shrink and their valuation contribution can be negligible. The collaboration agreement for BL-B01D1 with BMS changes the outlook of Biokin.
- The clinical data of BL-B01D1 look good so far, but the R&D failure risk of BL-B01D1 is not low. It is uncertain if BL-B01D1 would finally be druggable.
- Biokin is overvalued and there is big bubble in valuation. If BL-B01D1 fails in R&D or its clinical data fail to meet high expectation, Biokin’s market value will plummet.
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