In today’s briefing:
- Tata Technologies IPO: The Investment Case
- WuXi XDC Cayman IPO Trading – Strong Subscription Rates Heading into Listing
- ZEEKR IPO Preview: A Geely-Backed Fast-Growing Decacorn in China’s EV Revolution
- Ecopro Materials IPO Trading – One of the Weakest Subscription Rates of the Year
- Pre-IPO Genecast Group – NGS Still Has Long Way to Go; Valuation Performance Is Worrying
Tata Technologies IPO: The Investment Case
- Tata Technologies (TATATECH IN), the largest India-based ER&D service provider, seeks to raise US$350-375 million, which is lower than its previous target of US$600 million.
- Tata Technologies is seeking a valuation of US$2.5 billion, which is 27.5% higher than the valuation TPG Inc (TPG US) acquired a 9.0% stake on 25 October.
- The investment case rests on top-tier growth rates, strong core business, lower reliance on Vinfast (VFS US), high repeat rates, top-tier profitability, solid FCF profile and no debt.
WuXi XDC Cayman IPO Trading – Strong Subscription Rates Heading into Listing
- WuXi XDC Cayman (1877628D HK) raised US$470m in its Hong Kong IPO.
- WuXi XDC Cayman (WXDC) is a CRDMO focused on the global antibody drug conjugates (ADC) and broader bioconjugate market providing integrated and end-to-end services.
- In our previous notes, we looked at the company’s past performance and valuations. In this note, we talk about the trading dynamics.
ZEEKR IPO Preview: A Geely-Backed Fast-Growing Decacorn in China’s EV Revolution
- ZEEKR, a fast-growing premium BEV maker, filed its F-1 last week. The company is going public through an IPO and offering ADSs of a Cayman Islands holding company.
- In 2022, Geely agreed to spin off ZEEKR and list its EV maker in Asia/the U.S. The company has raised ~$1.6B and was backed by Geely and top-tier investors.
- Geely Auto will hold 50%+ of the voting power upon completing an IPO. ZEEKR’s last round was a $750M Series A in February 2023 at a $13B post-money valuation.
Ecopro Materials IPO Trading – One of the Weakest Subscription Rates of the Year
- EcoPro Materials (ECO123 KS) raised around US$320m, after downsizing the deal and pricing its IPO at the low end of the range at KRW36,200/share.
- Ecopro Materials (EPM) manufactures and sells high-nickel precursors, one of the key materials for high-nickel cathode materials for secondary (rechargeable) batteries.
- In this note, we will talk about the demand for the deal and other trading dynamics.
Pre-IPO Genecast Group – NGS Still Has Long Way to Go; Valuation Performance Is Worrying
- The clinical need for NGS hasn’t developed as rigid demand due to high cost, difficult operation, high requirements on hospitals/personnel, etc. It takes time for NGS to improve market penetration.
- Genecast’s LDT business could face compliance issue.Its in-hospital business has lower gross margin.Increasing R&D expenditure is inevitable since products need to get approval by regulatory authorities, putting pressure on profitability.
- Burning Rock is in a leading position in NGS field, but its market value is quite low. We advise investors to be prepared for valuations to fall short of expectations.
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