IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

Arun has over 15 years’ experience covering the Technology sector. During this time, he has worked with technology start-ups and as an equity analyst in investment banks and independent research firms. He was formerly a Technology Analyst for Canaccord Genuity, Altium Securities, Espirito Santo Investment Bank, Noble Group and Clear Capital. He has a dual Master’s degree in Financial Engineering and Industrial and Operations Engineering from the University of Michigan. He obtained his Bachelor’s degree in Mechanical Engineering from the Indian Institute of Technology, Bombay. He is also a CFA charterholder.

IPOs and Catalysts/Events

Acotec Scientific (6669 HK)’s Partial Offer of HK$20 from Boston Scientific

Weekly Deals Digest (18 Dec) - Acotec, Yashili, Toshiba, Toyo, Genesis, Norwest, O2Micro, VinFast

Acotec (6669 HK): Boston Scientific’s HK$20 Partial Offer Now Open

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Equity Capital Markets

Acotec Scientific Holdings / Equity Capital Markets

<div><p><a href="https://www.smartkarma.com/entities/acotec-scientific-holdings-limited" target="_blank" data-smartkarma-citation="entities:32176:1" rel="noopener">Acotec Scientific Holdings (6669 HK)</a> is a leading innovative medical device company in China focusing on providing treatment solutions for vascular diseases, particularly in the fields of drug-coated balloons (DCB) and thrombus aspiration catheters. The two core products are <em>AcorArt Orchid &amp; Dhalia</em> and <em>AcorArt Tulip &amp; Litos</em>. </p></div><div><p>Acotec has launched an HKEx IPO to raise net proceeds of HK$1,473.6 million ($189 million) at the mid-point of the IPO price range of HK$22.20-23.80 per share. Thirteen Chinese cornerstone investors will subscribe for $105 million worth of the offer shares. Pricing will be finalised on 17 August and the shares will list on 24 August.</p></div><div><p>In <a href="https://www.smartkarma.com/insights/acotec-scientific-ipo-living-right" target="_blank" data-smartkarma-citation="insights:56006" rel="noopener">Acotec Scientific IPO: Living Right</a>, we opined that Acotec has an established commercialisation track record with <em>AcorArt Orchid &amp; Dhalia</em> launched in China in 2016. The growth story is supported by ongoing market growth, the recent commercial launch of its second core product, indication expansion for the core products and ambition to commercialise all of the product candidates in the pipeline before the end of 2025. We concluded that Acotec’s product portfolio is attractive.  </p></div><div><div><div class="content-highlight"><p>Our base-case DCF valuation is HK$21.65 per share, which is a -6% downside to the mid-point of the IPO price range of HK$22.20-23.80 per share. Consequently, we think the shares are fully priced at the IPO price range. In combination with the lack of blue-chip cornerstone investors, we would wait on the sidelines for a lower entry point. </p></div></div></div>

Acotec Scientific Holdings (6669 HK) is a leading innovative medical device company in China focusing on providing treatment solutions for vascular diseases, particularly in the fields of drug-coated balloons (DCB) and thrombus aspiration catheters. The two core products are AcorArt Orchid &amp; Dhalia and AcorArt Tulip &amp; Litos. Acotec has launched an HKEx IPO to raise net proceeds of HK$1,473.6 million ($189 million) at the mid-point of the IPO price range of HK$22.20-23.80 per share. Thirteen Chinese cornerstone investors will subscribe for $105 million worth of the offer shares. Pricing will be finalised on 17 August and the shares will list on 24 August.In Acotec Scientific IPO: Living Right, we opined that Acotec has an established commercialisation track record with AcorArt Orchid &amp; Dhalia launched in China in 2016. The growth story is supported by ongoing market growth, the recent commercial launch of its second core product, indication expansion for the core products and ambition to commercialise all of the product candidates in the pipeline before the end of 2025. We concluded that Acotec’s product portfolio is attractive.  Our base-case DCF valuation is HK$21.65 per share, which is a -6% downside to the mid-point of the IPO price range of HK$22.20-23.80 per share. Consequently, we think the shares are fully priced at the IPO price range. In combination with the lack of blue-chip cornerstone investors, we would wait on the sidelines for a lower entry point. 

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Acotec Scientific IPO: Valuation Insights