In today’s briefing:
- Webtoon Entertainment (WBTN US) IPO: The Bear Case
- Growth of SHEIN, Temu Appears to Be Boosting Asia-US Air Cargo Volume & Pricing
- Hyundai Motor India IPO: Key Facts and Financials at a Glance
- Kagome Placement – Very Well Flagged Deal but Liquidity Might Be a Concern
- ECM Weekly (17th June 2024)-Shift Up, Webtoon, Quantum, Guzman, MaoGeping, Johor Plant, Telix, Atour
- Johor Plantations IPO – ASPs to Remain Resilient, Downside Appears Limited
- Pre-IPO Fangzhou Inc. (PHIP Updates) – Some Points Worth the Attention
Webtoon Entertainment (WBTN US) IPO: The Bear Case
- Webtoon Entertainment (WBTN US), a global storytelling platform, seeks to raise up to US$500 million through a Nasdaq IPO.
- In Webtoon Entertainment 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 declining organic revenue, declining Korean paying ratio, a peaking Japan growth driver, optimistic market sizing, and unsustainable low marketing spending.
Growth of SHEIN, Temu Appears to Be Boosting Asia-US Air Cargo Volume & Pricing
- For first time since 2022, carriers’ cargo revenue, yield, load factor all rising
- Asia outbound, US inbound air cargo tons both improving in early 2024
- SHEIN, Temu could account for 40%+ of US inbound air tons from CH, HK, TW
Hyundai Motor India IPO: Key Facts and Financials at a Glance
- Hyundai Motor India’s proposed IPO is an offer for sale by its parent, Hyundai Motor Company, Korea, and reported to raise USD3 billion, potentially making it India’s largest IPO ever.
- Hyundai Motor India’s sales growth has been driven by strong domestic and export sales, both in volume and unit realisation.
- With SUVs now making up 62% of Hyundai Motor India’s domestic volumes, up from 45% in FY2021, the shift towards premium models has boosted profit margins.
Kagome Placement – Very Well Flagged Deal but Liquidity Might Be a Concern
- Kagome Co Ltd (2811 JP) aims to raise around US$140m to repay debt used to fund the acquisition of Ingomar in Jan 2024.
- At the time of the acquisition, the company has stated its intention to part finance the acquisition via issuance of treasury shares
- In this note, we will talk about the placement and run the deal through our ECM framework.
ECM Weekly (17th June 2024)-Shift Up, Webtoon, Quantum, Guzman, MaoGeping, Johor Plant, Telix, Atour
- Aequitas Research’s weekly update on the IPOs, placements, lockup expiry and other ECM linked events that were covered by the team over the past week.
- On the IPO front, we continued to look at Shift Up (462870 KS), Guzman Y Gomez and Webtoon Entertainment (WBTN US), along with Mao Geping Cosmetics.
- On the placement front, there were quite a few deals in India, while Atour Lifestyle Holdings (ATAT US) was the major Asia linked offerings.
Johor Plantations IPO – ASPs to Remain Resilient, Downside Appears Limited
- Johor Plantations Group (2368120D MK) is looking to raise US$156m in its Malaysia IPO. The IPO will consist of both primary and secondary shares.
- Johor Plantations Group (JPG) is an upstream oil palm plantation firm operating predominantly in Johor, Malaysia.
- In this note, we look at the updates since, and share our thoughts on valuation.
Pre-IPO Fangzhou Inc. (PHIP Updates) – Some Points Worth the Attention
- Fangzhou cannot get around the decreasing unit-price of drugs and the increasing role of medical insurance in chronic-disease treatment.It’s challenging to find patients willing to pay out of own pockets.
- The internal dispute between the Founder and shareholders hasn’t ended, and related litigation is still pending. This makes us concerned about the stability of future business development and corporate governance.
- Fangzhou has significant cash flow pressure. In the case of increasingly fierce competition in the industry, without successful business diversification/transformation, growth prospects is gloomy, Valuation should be lower than peers.
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