New Zealand Professional Investment Services Firm

Forsyth Barr

We are proud to be a New Zealand owned firm, with 21 offices throughout the country and over 300 employees. We assist personal, institutional and corporate clients providing a full range of investment services.

Forsyth Barr is a foundation New Zealand Exchange firm (NZX) and accredited market participant. We have been confirmed by the Financial Markets Authority as a Qualifying Financial Entity (QFE).

Research is the cornerstone of our advice. We have one of New Zealand's leading teams of analysts. Our global affiliations ensure comprehensive research coverage of all major investment markets.

New Zealand Professional Investment Services Firm, Forsyth Barr

Equity Bottom-Up

<h2>NZX Tracking Brief</h2>
<ul>
<li>NZX September monthly data shows strong total capital raised for the month, predominantly from retail and wholesale debt</li>
<li>NZX has been granted FMA confirmation that companies direct listing do not required PFI (previously mandatory)</li>
<li>Total value traded for the year joins total capital raised for the year in exceeding company targets set at the start of the year in February for FY20</li>
<li>Data terminals and licences remain elevated post COVID-19</li>
<li>Funds Under Administration and Funds Under Management see little change for the month</li>
<li>Rating: OUTPERFORM</li>
</ul>
&nbsp;
<figure class="editor-figure mceNonEditable"><img src="https://mail.google.com/mail/u/0?ui=2&amp;ik=f57c39853c&amp;attid=0.1&amp;permmsgid=msg-f:1679654976100786175&amp;th=174f554d33b45fff&amp;view=fimg&amp;sz=s0-l75-ft&amp;attbid=ANGjdJ9uCbwes8ASi-bot37xilrBWz5soRLGVp8LOQ_oSzLGgAPk_Cbmzz55I3FcrDXQTU5mBcTbbz8NxrpFtia91o0OCBNfYDMs9iUTmWhMcGOr-TfJIu0h0nTiAJY&amp;disp=emb" width="311" height="162" class="editor-image img-responsive" data-image-whitelisted=""></figure>
Direct listings
Following a recent consultation NZX has changed the listing rules around direct listings (a stock exchange listing without raising capital) after confirmation from the FMA. The Listing Rule amendment now means that for a company direct listing PFI (prospective financial information) is optional as opposed to being mandatory. The Listing Rule amendment will take effect from 3 November. In addition NZX has also changed rules around dual listing, making the process for overseas issuers to duel list on the NZX a more simple process. &nbsp;
Issuer Relationships
<ul>
<li>September saw the second highest level of monthly capital raised for the year for NZX (behind April-20), driven by retail and wholesale debt listings</li>
<li>NZ$2.2bn of capital was raised across equity and debt for the month taking the total for the year to NZ$12.7bn</li>
<li>Post COVID-19 secondary equity capital raises have slowed as expected</li>
</ul>
Issuer Relationships Tracking Progress:
<figure class="editor-figure mceNonEditable"><img src="https://mail.google.com/mail/u/0?ui=2&amp;ik=f57c39853c&amp;attid=0.3&amp;permmsgid=msg-f:1679654976100786175&amp;th=174f554d33b45fff&amp;view=fimg&amp;sz=s0-l75-ft&amp;attbid=ANGjdJ-1fq28Lh1pS2fiZauRSv-0369lHMbz0uxItgF-6gbumr_a1YUYXZieJh7VO_WJVwDq83sPsVs8qNjVrrPprBfpz-TQ47PIyZc_tGatPW-aV8qyfcULT96kszg&amp;disp=emb" width="614" height="303" class="editor-image img-responsive" data-image-whitelisted=""></figure>
Secondary Markets
<ul>
<li>Total value traded for the year (NZ$40.5) now exceeds company targets set for the year in February (NZ$38.6bn)</li>
<li>Total cash traded value (NZ$4.6bn) remains well ahead of the previous year (+45% on September 2019) and in line with the 1H20 average of NZ$4.6bn</li>
<li>September saw a slight increase in total cash value traded (4th highest month of the year to date) but volumes slightly down (3rd lowest of the year and lowest since February)</li>
<li>This implies that there have been larger but less frequent trades across the month and this is reflected in the decrease of retail ASB &amp; Sharesies trades, while All Other remains broadly flat</li>
<li>Sharesies plus ASB now make up 30% of volume (17% September 2019, 34% August 2020) and 6% of total value for the month (4% September 2019, 7% August 2020)</li>
</ul>
Growth year on year January 2019 to September 2020, total market traded volume and non-retail traded volume (IRESS data)
<figure class="editor-figure mceNonEditable"><img src="https://mail.google.com/mail/u/0?ui=2&amp;ik=f57c39853c&amp;attid=0.4&amp;permmsgid=msg-f:1679654976100786175&amp;th=174f554d33b45fff&amp;view=fimg&amp;sz=s0-l75-ft&amp;attbid=ANGjdJ_gzE4K42fw-TQOx5z4NA92QLRwPjYOj2HqXjObU9HG4pV7xVnbfOrWRYuv26kjkPf-YOwQMtLJ6Y1ZNwtK39hR7Fkf33GKmJOTGqQDUX-SdiKzAzrmYZtrSRQ&amp;disp=emb" class="editor-image img-responsive"></figure>
Combined ASB and Sharesies % volume and value of total market Jan-19 to September-20 (IRESS data)
<figure class="editor-figure mceNonEditable"><img src="https://mail.google.com/mail/u/0?ui=2&amp;ik=f57c39853c&amp;attid=0.5&amp;permmsgid=msg-f:1679654976100786175&amp;th=174f554d33b45fff&amp;view=fimg&amp;sz=s0-l75-ft&amp;attbid=ANGjdJ831rqDRxRubAo1jYXif3aub2ItsyCGeTqvlIASx-91nRSH-atfQmE0KbS2AjxgFX611cF9QMLGBYhfgJFaI_wXGiJ-IZBMBcANTmU96t4hNg7m15A5FTiJ734&amp;disp=emb" width="604" height="395" class="editor-image img-responsive" data-image-whitelisted=""></figure>
Total cash traded Jan-19 to Sept-20 (NZX data)
<figure class="editor-figure mceNonEditable"><img src="https://mail.google.com/mail/u/0?ui=2&amp;ik=f57c39853c&amp;attid=0.6&amp;permmsgid=msg-f:1679654976100786175&amp;th=174f554d33b45fff&amp;view=fimg&amp;sz=s0-l75-ft&amp;attbid=ANGjdJ9KYjgObnUlKGDOnE5wTUZf6PDkwIFcfHoeW-pCaM9ZVjPhh06uMdZEjPfgLQdkPUFv56oHTv3G8TVr1jRGoamMT5Akez-h9cLDkvcNCHDuHAxrc2ZDLT-wtNk&amp;disp=emb" class="editor-image img-responsive"></figure>
Secondary Markets Tracking Progress:
<figure class="editor-figure mceNonEditable"><img src="https://mail.google.com/mail/u/0?ui=2&amp;ik=f57c39853c&amp;attid=0.7&amp;permmsgid=msg-f:1679654976100786175&amp;th=174f554d33b45fff&amp;view=fimg&amp;sz=s0-l75-ft&amp;attbid=ANGjdJ_8cHEPLv8b1Y2hKcZaEZcA3bAUwMHV3K0go9nANJQTFrNlFW844YAlUmHcJcnIa3m3kPIVKoesfuVLEzj0axcCBFglfMA65IaVgJoTQXQaVTaufy-TDoOn-eM&amp;disp=emb" width="603" height="289" class="editor-image img-responsive" data-image-whitelisted=""></figure>
Data and Insights
<ul>
<li>Total terminals and licences remain at elevated levels for September post COVID-19 with monthly total terminals and licences +19% on the previous year for the month</li>
<li>The FY20 average monthly total YTD is +13% greater than the monthly average for 2019.</li>
</ul>
<figure class="editor-figure mceNonEditable"><img src="https://mail.google.com/mail/u/0?ui=2&amp;ik=f57c39853c&amp;attid=0.8&amp;permmsgid=msg-f:1679654976100786175&amp;th=174f554d33b45fff&amp;view=fimg&amp;sz=s0-l75-ft&amp;attbid=ANGjdJ92t429B8F-TkTLt9UJnHEA3aw9kVNJEC2xVsncukfh6DX17iocp7n_1-qmUBN7xzNlZJ4fiM-LQZSp0UWdbGBaqWrNqe7o9caV_Er0iLEPFlIgesfi6nDRqno&amp;disp=emb" class="editor-image img-responsive"></figure>
Funds Management
<ul>
<li>Both the Funds Under Administration and Wealth see little change for the month with Funds Under Management +20% year-on-year and Wealth Technologies +49% year-on-year.</li>
</ul>
<figure class="editor-figure mceNonEditable"><img src="https://mail.google.com/mail/u/0?ui=2&amp;ik=f57c39853c&amp;attid=0.9&amp;permmsgid=msg-f:1679654976100786175&amp;th=174f554d33b45fff&amp;view=fimg&amp;sz=s0-l75-ft&amp;attbid=ANGjdJ-Aesd5bkb3CT-fFmRHVxKwmRg8tKf8HHo8RrCU7T4S6VNSC3hXuXSJnZqVopjsQuNSG5XgH1r_9a5BZVZOuJYTRwEz7Q7lMy9LNFxI-NQcdzVQGtQTkyCojPY&amp;disp=emb" class="editor-image img-responsive"></figure>
Jamie Foulkes Analyst, Equities
<figure class="editor-figure mceNonEditable"><img src="https://mail.google.com/mail/u/0?ui=2&amp;ik=f57c39853c&amp;attid=0.2&amp;permmsgid=msg-f:1679654976100786175&amp;th=174f554d33b45fff&amp;view=fimg&amp;sz=s0-l75-ft&amp;attbid=ANGjdJ9xWXXRe95X4VRaxOB6Wqh2KUta7DVAGOdQaYJhzF1JVmxcoimsuFWm9JDO2O3G59V3Omy7A4knvAAbSHYZmTkVyXGeZIvOlNh1rd1LSKFwMMJ-fkUQGs6hbmA&amp;disp=emb" class="editor-image img-responsive"></figure>
 P:+64 4 914 2217 |TF:0800 367 227 Level 22, NTT Tower, 157 Lambton Quay, Wellington

NZX Tracking Brief

NZX September monthly data shows strong total capital raised for the month, predominantly from retail and wholesale debt
NZX has been granted FMA confirmation that companies direct listing do not required PFI (previously mandatory)
Total value traded for the year joins total capital raised for the year in exceeding company targets set at the start of the year in February for FY20
Data terminals and licences remain elevated post COVID-19
Funds Under Administration and Funds Under Management see little change for the month
Rating: OUTPERFORM

&nbsp;

Direct listings
Following a recent consultation NZX has changed the listing rules around direct listings (a stock exchange listing without raising capital) after confirmation from the FMA. The Listing Rule amendment now means that for a company direct listing PFI (prospective financial information) is optional as opposed to being mandatory. The Listing Rule amendment will take effect from 3 November. In addition NZX has also changed rules around dual listing, making the process for overseas issuers to duel list on the NZX a more simple process. &nbsp;
Issuer Relationships

September saw the second highest level of monthly capital raised for the year for NZX (behind April-20), driven by retail and wholesale debt listings
NZ$2.2bn of capital was raised across equity and debt for the month taking the total for the year to NZ$12.7bn
Post COVID-19 secondary equity capital raises have slowed as expected

Issuer Relationships Tracking Progress:

Secondary Markets

Total value traded for the year (NZ$40.5) now exceeds company targets set for the year in February (NZ$38.6bn)
Total cash traded value (NZ$4.6bn) remains well ahead of the previous year (+45% on September 2019) and in line with the 1H20 average of NZ$4.6bn
September saw a slight increase in total cash value traded (4th highest month of the year to date) but volumes slightly down (3rd lowest of the year and lowest since February)
This implies that there have been larger but less frequent trades across the month and this is reflected in the decrease of retail ASB &amp; Sharesies trades, while All Other remains broadly flat
Sharesies plus ASB now make up 30% of volume (17% September 2019, 34% August 2020) and 6% of total value for the month (4% September 2019, 7% August 2020)

Growth year on year January 2019 to September 2020, total market traded volume and non-retail traded volume (IRESS data)

Combined ASB and Sharesies % volume and value of total market Jan-19 to September-20 (IRESS data)

Total cash traded Jan-19 to Sept-20 (NZX data)

Secondary Markets Tracking Progress:

Data and Insights

Total terminals and licences remain at elevated levels for September post COVID-19 with monthly total terminals and licences +19% on the previous year for the month
The FY20 average monthly total YTD is +13% greater than the monthly average for 2019.


Funds Management

Both the Funds Under Administration and Wealth see little change for the month with Funds Under Management +20% year-on-year and Wealth Technologies +49% year-on-year.


Jamie Foulkes Analyst, Equities

 P:+64 4 914 2217 |TF:0800 367 227 Level 22, NTT Tower, 157 Lambton Quay, Wellington

NZX

NZX: Tracking Brief