This weekly newsletter pulls together summaries of the top ten most-read Insights across Equity Capital Markets on Smartkarma.
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1. Kioxia IPO – Should Price at the Top, Though Peers Are Still Correcting
- Kioxia Holdings (285A JP) is aiming to raise around US$840m (including over-allocation) in its Japan IPO.
- It was the world’s largest pure-play NAND flash memory supplier, in terms of both revenue and unit shipments in 2023, according to TechInsights.
- We have looked at the company’s past performance in our previous notes. In this note, we will talk about the IPO valuations.
2. Kioxia IPO: Peer Comparison and Valuation
- Kioxia has announced the terms for its IPO, and plans to raise $730m through issuing new shares as well as offer by existing shareholders, at a market capitalisation of $819bn.
- Kioxia Holdings (285A JP) ‘s earnings have been volatile and margins have trailed compared to peers Micron and SK Hynix. Earnings are approaching a new peak.
- Kioxia’s implied valuation multiples are at a deep discount to peer multiples, suggesting there is significant upside to the indicative IPO price range.
3. Kioxia (285A JP) IPO: Valuation Insights
- Kioxia Holdings (285A JP) is a leading player in the NAND flash memory market. It will list on 18 December and seek to raise up to US$727 million.
- We previously discussed the IPO in Kioxia (285A JP) IPO: The Bull Case and Kioxia (285A JP) IPO: The Bear Case.
- Our valuation analysis suggests that the IPO price range of JPY1,390-1,520 per share is attractive. Therefore, we would participate in the IPO.
4. Goodman Group Placement – Large Shareholder Looking to Raise US$1.2bn but Discount Is Tight
- CIC is looking to raise around US$1.2bn, via selling around 2.6% of its stake in Goodman Group (GMG AU) , via a block trade.
- Goodman’s shares have performed exceptionally well over the past year, driven by its pivot towards data centers.
- In this note, we will talk about the placement and run the deal through our ECM framework.
5. Auckland Airport Placement – NZ$1.3bn (US$770m) Cleanup Sale Will Remove the Overhang
- Auckland Council is looking to raise NZ$1.3bn (US$772m) from selling its entire stake in Auckland Intl Airport (AIA NZ).
- Overall, the selldown will be a large one for the stock to digest at 10% of shares outstanding and 62 days of three month ADV.
- In this note, we run the deal through our ECM framework and comment on deal dynamics.
6. Mao Geping Cosmetics IPO – Low to Mid-End Looks Reasonable
- Mao Geping Cosmetics is looking to raise up to US$270m in its upcoming Hong Kong IPO.
- Mao Geping Cosmetics (MGC) operates in the premium beauty segment. Operating via its two brands, MAOGEPING and Love Keeps, MGC offers a wide range of color cosmetics and skincare products.
- We have looked at the company’s past performance in our previous notes. In this note, we will talk about the IPO valuations.
7. DigiCo Infrastructure REIT IPO – Looks Decent – After All the Adjustments
- DigiCo REIT (DIGICO AU) is looking to raise around US$1.3bn in its Australian IPO.
- DigiCo REIT (DREIT) aims to be a diversified owner, operator and developer of data centres, with a global portfolio and broad investment mandate across stabilised, value-add and development opportunities
- We have looked at the company’s past performance in our previous notes. In this note, we will talk about the IPO valuations.
8. LG CNS IPO Details Out: My Read on This IPO
- The KRW 5T-6T valuation and 13x-16x PER look solid compared to local peers like SDS and Hyundai AutoEver, with CNS possibly getting a premium due to its smaller captive stake.
- Instos probably won’t push hard for lock-ups but will aggressively target pricing to secure larger allotments, knowing the company is likely to stick with a market-friendly price.
- On a separate note, I wouldn’t expect much of a NAV discount reduction for LG Corp, as LG CNS’s stake isn’t significant enough to move the needle.
9. Mr DIY Indonesia IPO – Has Aggressively Expanded Its Network
- PT Daya Intiguna Yasa Tbk (Mr DIY Indonesia) (2517930D IJ) is looking to raise US$296m from its Indonesia IPO.
- Mr DIY Indonesia (MRDIYI) is a home improvement retailer. The firm is the largest home improvement retailer in Indonesia with a 25.2% market share as per 2023 sales
- In this note, we look at the firm’s past performance.
10. Mr DIY Indonesia IPO – Aiming to Repeat the Performance of Its Parent’s Listing
- PT Daya Intiguna Yasa Tbk (Mr DIY Indonesia) (2517930D IJ) is looking to raise US$296m from its Indonesia IPO.
- Mr DIY Indonesia (MRDIYI) is a home improvement retailer. The entity is the Indonesian entity under the Mr DIY group’s list of subsidiaries.
- In this note, we will undertake a peer comparison and discuss our thoughts on valuation.
