In today’s briefing:
- TRYT IPO: Down 25% and Upside Is Limited
- Star Asia Investment Placement – Past Deals Have Held Up, REIT on Track to Meet Its Midterm Targets
- Nexteel IPO Book Building Results Analysis
- Why SHEIN and Temu Are Worried About Reform of De Minimis Imports into the US
TRYT IPO: Down 25% and Upside Is Limited
- TRYT’s shares started trading on TSE on 24th July. The IPO was priced at ¥1,200 per share and closed at ¥876 per share at the end of first day trading.
- The company’s shares are currently trading at around ¥900 per share, at a 25% discount to TRYT (9164 JP) ‘s IPO price.
- We recommended staying on the sidelines as the company’s IPO was overvalued and our DCF valuation suggests that shares are fairly valued at the current price.
Star Asia Investment Placement – Past Deals Have Held Up, REIT on Track to Meet Its Midterm Targets
- Star Asia Investment (3468 JP) is looking to raise around US$180m in its extended primary follow-on raising. The proceeds will be used to acquire 12 new hotels.
- The deal would be a large deal to digest at 110 days of three month ADV, with the new shares representing around 19% of dilution.
- The REIT has undertaken capital raisings over the past few years to fund its active portfolio management strategy. Thus, we would argue that the deal here is well flagged.
Nexteel IPO Book Building Results Analysis
- Nexteel reported disappointing IPO book building results from institutional investors. The IPO price has been confirmed at 11,500 won which is at the low end of the IPO valuation range.
- A total of 700 institutions participated, with a demand ratio of 236 to 1. It is scheduled to be listed on the KOSPI exchange on 21 August.
- Despite the weak IPO book building results, we maintain our positive view of the Nexteel IPO. Our base case valuation of Nexteel is implied market cap of 485.8 billion won.
Why SHEIN and Temu Are Worried About Reform of De Minimis Imports into the US
- SHEIN announced it wants a role in reforming US de minimis import regulations
- A tightening of de minimis threshholds could undermine SHEIN (and Temu) in the US
- The de minimis issue highlights SHEIN’s and Temu’s lack of political allies in the US
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