This weekly newsletter pulls together summaries of the top ten most-read Insights across Equity Capital Markets on Smartkarma.
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1. YUUUGE Modec (6269) Offering To Stay Listed in TSE Prime – Effectively a Re-IPO
- In March, Modec Inc (6269 JP) announced the TSE had said Modec at 29.3% (end-Dec-23) was below the required 35% tradable shares level required for continued listing on TSE Prime.
- It announced a “Basic Plan” to comply with the criteria which involved convincing one of the three major corporate holders to sell some. They needed to sell about 6%.
- Mitsui E&S has announced it will sell 32%, and 37% including greenshoe. This is overdoing it in a huge way. Mitsui E&S is getting out. This is a re-IPO.
2. Modec Placement – Deal Seems a Little Opportunistic but Not Particularly Expensive
- Mitsui E&S Holdings (7003 JP) is looking to raise approximately US$451m through a secondary follow-on offering, via selling approximately 21.9m shares (32% of TSO) of Modec Inc (6269 JP)’s stock.
- The deal is a large one to digest at 81 days of three month ADV.
- In this note, we will talk about the placement and run the deal through our ECM framework.
3. MODEC (6296 JP): A US$535 Million Secondary Offering
- Modec Inc (6269 JP) has announced a secondary offering of up to 25.2 million shares (including overallotment). The largest shareholder, Mitsui E&S Holdings (7003 JP), is the seller.
- MODEC’s goal with the secondary offering is to reconfigure its shareholder mix to have a diverse base of shareholders who support its long-term strategies and a better tradable share ratio.
- Looking at recent large Japanese placements is instructive for understanding the potential offer price. The pricing date will likely fall between 22 and 28 May (likely 22 May).
4. Hyundai Heavy Industries Block – Not Well Flagged and Recent Korean Deals Haven’t Done Well
- HD Korea Shipbuilding & Offshore Engineering (009540 KS) is looking to raise approximately US$258m, via selling 2.6m shares (2.9% of TSO) of HD Hyundai Heavy Industries (329180 KS) stock.
- The deal is a large one to digest at 14.6 days of three month ADV.
- In this note, we will talk about the placement and run the deal through our ECM framework.
5. Giant Biogene Placement – Has Been Doing Well but Doesn’t Need the Cash
- Giant Biogene (2367 HK) aims to raise up to US$205m via a top-up placement.
- We have followed the company since listing and its recent performance has been great. Although it doesn’t seem to need the cash.
- In this note, we will run the deal through our ECM framework and talk about the recent updates.
6. ECM Weekly (13th May 2024) – Hyundai Marine, Zeekr, Swiggy, Indegene, Aadhar, TBO, Wuxi XDC, ASMedia
- Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
- On the IPO front, after a stellar showing by HD Hyundai Marine Solution (443060 KS), the coming week will be a busy one for India listings.
- On the placement front, there were no major deals during the week. We did look at Asmedia Technology (5269 TT) planned GDR, and Wuxi XDC’s upcoming lockup expiry.
7. Olympus Corp (7733 JP): ¥100B Buyback Plan Offers an Attractive Exit Opportunity Amid Bleak Outlook
- Olympus Corp (7733 JP) has announced a buyback plan for up to 60M shares, representing 5.15% of outstanding shares, by spending ¥100B from May 13 to December 31, 2024.
- The company has posted mixed FY24 results, with revenue beating and operating and net profits missing guidance. Olympus has guided for just 9% revenue growth for FY25.
- Overall business outlook of the company seems to be bleak. With limited upside potential expected, it will be wise to tender shares through the company’s buyback offer.
8. ZEEKR IPO: Strong First-Day Return and Upsized Offering
- ZEEKR, a rapidly growing premium EV maker, has successfully completed its IPO and raised ~$441M. The offering was priced at the top of the range at $21 per share.
- The company sold a total of 21M ADSs, up from the initial target of 17.5M shares. ZEEKR’s stock soared more than 30% following its strong debut on NYSE on Friday.
- Geely Auto, Mobileye and CATL have acquired ~14.3M ADSs and overall investor sentiment was positive. I believe ZEEKR may succeed as a high-volume EV maker worldwide.
9. Lalatech Holdings Limited Pre-IPO – Refiling Updates – Continues to Improve, Valuation Gap Narrowing
- Lalatech Holdings is looking to raise about US$1bn in its upcoming HK IPO.
- Lalatech operates via a marketplace model serving merchants and carriers. Its platform facilitates closed-loop transactions from online shipping order booking to intelligent order matching, and automated dispatching to after-sale services.
- We have looked at the company’s past performance in our earlier notes. In this note we will talk about the updates from its refiling.
10. Aadhar Housing Finance IPO Trading – More Loved by Institutional Investors than Retail
- Aadhar Housing Finance(AHF) raised around US$360m in its India IPO, via selling a mix of primary and secondary shares.
- AHF is focused on the low income housing segments (ticket size less than INR1.5m) in India. It offers a range of mortgage-related loan products.
- We have looked at the company’s performance and valuation in our past notes. In this note, we talk about the trading dynamics.
