ECM Weekly (16 August 2020) - RemeGen, Neusoft Edu, Huazhu HK, Xpeng Motors, KE Holdings
Aequitas Research puts out a weekly update on the deals that have been covered by the team recently along with updates for upcoming IPOs.
Hong Kong's IPO pipeline is looking like it will be packed with blockbuster IPOs comprising of China ADRs' homecoming and unicorns looking to dual list in Hong Kong and China. This week, it was reported Vipshop is the newest US-listed Chinese company to make a move to list closer to home.
Beyond that, Ant Financial has made preparatory filing with China Securities Regulatory Commission (CSRC) which will get the company ready for its dual listing in Hong Kong and STAR market as mentioned by the company last month. SenseTime was also said to be considering a dual listing in Hong Kong and China. Nongfu Spring (NON HK) got approved by HKEX this week to move forward with its IPO and will be pre-marketing next week.
Our coverage for upcoming Hong Kong IPOs and secondary listings this week:
- Neusoft Edu (东软教育) Pre-IPO: Long Established Name on IT Education
- Huazhu HK Secondary Listing - Early Look - Needs the Cash More than Most Secondary Candidates
- RemeGen (荣昌生物) Pre-IPO: Thoughts on Valuation of RC18 and RC48
Earlier coverage on Nongfu Spring (NON HK):
- Nongfu Spring Pre-IPO - The Positives - Leaves One Thirsty for More
- Nongfu Spring Pre-IPO - The Negatives - Doesn’t Need to List or Expand Production Facilities
- Nongfu Spring Pre-IPO - Peer Comparison - Superior Margins and Growth
- Nongfu Spring (农夫山泉) IPO: Bottle Size Matters, Photos on the Ground
- Nongfu Spring (农夫山泉) IPO: Beverage for the Young, In-Store Photos
IPO pipeline in other Southeast Asia markets seem to be warming up finally as MR D.I.Y. Group (1706769D MK) was said to be reviving its IPO plans next month after it delayed its IPO due to COVID-19. Glove maker Harps is also jumping on the bandwagon as it just hired banks to push forward with an IPO likely in the first half of 2021.
- Mr D.I.Y. Pre-IPO - Largest Home Improvement Retailer in Malaysia
- Mr D.I.Y. Pre-IPO - Store Walk-Through and Thoughts on Value Proposition
- Mr D.I.Y. Pre-IPO - Peer Comparison - Small Stores with Dominant Market Share
- Mr D.I.Y. Pre-IPO - Assumptions and Thoughts on Valuation
In Philippines, Areit (AREIT PM) performance was disappointing as it broke IPO price on debut and closed the week 10% lower. There were reports that some brokers were unaware of a special licence required to trade REITS which had resulted in the lack of retail orders.
Lastly, in the U.S., KE Holdings Inc (BEKE US) debut did exceedingly well, closing 87% higher on the first day before retracing on Friday to close out the week with still about 65% up from IPO price. The strong performance could continue to spur more China ADRs to list despite the homecoming efforts by existing companies. Xpeng Motors (XPEV US) filed last week whereas Lufax has filed confidentially that could raise about US$2-3bn.
- Xpeng Motors (小鹏汽车) Pre-IPO - Lots to like with Solid Backing from Investors
- KE Holdings/Beike IPO - Can't See Much Upside
- KE Holdings/Beike IPO Trading - We Would Be Sellers if It Pops
Placements coverage this week:
- China Education Group (中国教育集团) Placement - Likely Expected After Acquisition Announcement
- Mitsubishi Estate Logistic REIT Placement - Back for Its Annual Placement
- OneConnect Financial Placement - Even More Expensive Now
- ICICI Bank Placement - Last of the Big Private Bank Raising
Accuracy Rate:
Our overall accuracy rate is 73% for IPOs and 66.2% for Placements
(Performance measurement criteria is explained at the end of the note)
New IPO filings this week
- JW Therapeutics (Hong Kong, >US$100m)
Below is a snippet of our IPO tool showing upcoming events for the next week. The IPO tool is designed to provide readers with timely information on all IPO related events (Book open/closing, listing, initiation, lock-up expiry, etc) for all the deals that we have worked on. You can access the tool here or through the tools menu.
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- ECM Weekly (30 August 2020) - Ant Group, Kioxia, Yum China, Blue Moon, Softbank Corp Secondary30 Aug 2020
- Nongfu Spring IPO - Not Cheap by Any Measure but Is a Quality Name25 Aug 2020
- ECM Weekly (23 August 2020) - Nongfu Spring, Xpeng, Sunac Services, Pop Mart23 Aug 2020
- KE Holdings/Beike IPO Trading - We Would Be Sellers if It Pops13 Aug 2020
- Huazhu HK Secondary Listing - Early Look - Needs the Cash More than Most Secondary Candidates12 Aug 2020
- ECM Weekly (9 August 2020) - KE Holdings, Pop Mart, Everest Med, KWG Living, E-Star Comm09 Aug 2020