In today’s briefing:
- StubWorld’s: Amorepacific’s Multi-Year Lows
- Ecopro Materials IPO – Updated Thoughts on Valuation – Sentiment Has Gotten Worse
- Kum Yang – Submits An Agenda to Expand Issuance Limit of CB and BW to 10 Trillion Won
- LS Materials IPO Valuation Analysis
StubWorld’s: Amorepacific’s Multi-Year Lows
- Both the implied stub for Amorepacific Group (002790 KS) and the simple ratio (Group/Amorepacific Corp (090430 KS)) are around lifetime low levels.
- Preceding my comments on Amorepacific are the current setup/unwind tables for Asia-Pacific Holdcos.
- These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation >20%.
Ecopro Materials IPO – Updated Thoughts on Valuation – Sentiment Has Gotten Worse
- EcoPro Materials (ECO123 KS) is looking to raise up to US$469m in its Korean IPO.
- Ecopro Materials (EPM) manufactures and sells high-nickel precursors, one of the key materials for high-nickel cathode materials for secondary (rechargeable) batteries.
- In our previous notes, we covered the company’s performance, undertook a peer comparison and shared our thoughts on valuation. In this note, we will share our updated thoughts on valuation.
Kum Yang – Submits An Agenda to Expand Issuance Limit of CB and BW to 10 Trillion Won
- On 30 October, Kum Yang announced that it has submitted an agenda to expand the issuance limit of CB and BW to 10 trillion won.
- This increase in the limit of CB and BW issuance to 10 trillion won would mean potential capital raise through these methods that are nearly 2x its entire market cap.
- Kum Yang may be trying to raise large amount of capital (several trillion won) which could result in significant dilution risk for the existing shareholders.
LS Materials IPO Valuation Analysis
- Our base case valuation of LS Materials IPO is target price of 6,628 won per share, which is 21% higher than the high end of the IPO price range.
- We estimate LS Materials to generate sales of 155.5 billion won (down 4% YoY) and 197.2 billion won (up 26.8% YoY) in 2024.
- LS Materials is one of the largest players globally in the large-size ultracapacitors, which stabilize power supply and are used to replace and supplement primary batteries and lithium-ion batteries.
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