Daily Brief Financials: Rakuten Bank, Mapletree Logistics Trust, Bank Mandiri Persero, Roojai, Vonovia SE, China Jinmao Holdings, Qoala, Binance Coin and more

• Rakuten Bank (5838 JP), the online banking arm of Rakuten (4755 JP), aims to raise up to around US$900m in its Japan listing in April 2023.
• RB is the largest internet bank in Japan, by number of accounts. As of Dec 22, it had 13.3m deposit accounts with a total deposit base of JPY8.8tn.
• In our earlier notes, we have looked at the company’s past performance and undertook a peer comparison. In this note, we provide our thoughts on valuation.

• Mapletree Logistics Trust (MLT SP) plans to raise around US$150 (S$200m) to partially fund the acquisition of logistics properties in Japan, Australia and South Korea.
• We have earlier covered the previous six placements for the REIT since 2017. Most of the past deals have done well except for the two most recent ones.
• In this note, we will run the deal through our ECM framework and talk about deal dynamics.

• We rate Bank Mandiri as our top pick with its attractive valuations including PEG ratio relative to solid returns and strong balance sheet – including liquidity –  metrics
• We also continue to favour Bank Negara, but it is our secondary value pick to Mandiri; Bank Central Asia, albeit fully valued, has impressive liquidity and return metrics
• Bank Rakyat had mixed returns in 4Q22, with pre-provision returns declining sharply QoQ although cost of risk continued to improve, due to better credit quality, thereby supporting post-provision profits

• Thai insurtech company Roojai has secured US$42 million in new financing round, as per multiple news reports.
• HDI International, a subsidiary of Germany’s Talanx Group, led the round that also saw participation from existing investor IFC.
• About US$32 million will be invested via direct injection and the remaining amount through a secondary share transaction.

• Vonovia has a high negative correlation to interest rates. What if interest rates were to stabilize or fall?
• Feedback from discussion with Head of IR gives confidence in the long-term prospects of the group
• Share price -32% ytd. Vonovia trades on a ~70% discount to its adjusted NTA

China Jinmao’s FY 2022 results were slightly weak, but in line with expectations. The company reported a slight top-line decline, while the gross margin contracted further to 16%. In addition, net debt continued to climb, due to acquisitions. For FY 2023, we expect revenue recognition to improve, although margins could remain weighed down by lower profitability at Jinmao’s city operations projects.

Positively, the company’s access to financing remains strong, as it was able to issue onshore bonds at low interest costs without having to provide credit enhancements. According to Jinmao, its average interest cost fell to a record low of 3.9%, despite the generally poor financing environment for the industry.

In other news, there were onshore rumours over the past week that the company may be merged with China Resources Land, with the energy businesses of China Resources Group to be integrated into Sinochem. All of the companies involved have denied the rumours. Still, we note that the business combination (if it materialises) will be positive for the CHJMAO notes, as China Resources Land is a stronger entity than Jinmao. That said, the merger is unlikely to trigger the Change of Control put, as the put option can only be triggered with a ratings downgrade.

• Indonesian insurtech startup Qoala announced that it has raised US$7.5 million in a series B extension round led by Europe’s responsAbility Investments.
• Existing investors Eurazeo and Indogen as well as new investor AppWorks also participated in the round.
• The startup declined to comment on its valuation, but VentureCap Insights currently pegs it at US$310 million following the fundraise.

• Binance is the world’s largest crypto exchange by a huge margin.
• It has achieved consistent growth since its founding in 2017, but its increasing dominance has been striking to watch since 2020, when it held around 25% of spot volume market share.
• Its market share approached 50% at the tail end of the 2021 bull market before retreating and again expanding to peak over 70% this year.