APAC IPOs & Placements, Aequitas Research

Clarence Chu

APAC IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/apa-group" target="_blank" data-smartkarma-citation="entities:18658:1" rel="noopener">APA Group (APA AU)</a> is looking to raise A$675m (US$430m) in its primary follow-on to partially fund its acquisition of the Alinta Energy assets in the Pilbara region.</li>
<li>The deal is a well flagged one with APA having been one of the last remaining bidders on the asset. Short interest has been on the rise as well.</li>
<li>However, the deal doesn’t seem accretive at our end, and the results reported today seemed to have missed analyst expectations.</li>
</ul>



APA Group (APA AU) is looking to raise A$675m (US$430m) in its primary follow-on to partially fund its acquisition of the Alinta Energy assets in the Pilbara region.
The deal is a well flagged one with APA having been one of the last remaining bidders on the asset. Short interest has been on the rise as well.
However, the deal doesn’t seem accretive at our end, and the results reported today seemed to have missed analyst expectations.


APA Group Placement - Well Flagged Deal, but Lacks in Accretion

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Index Rebalance

Brilliance China Automotive / Index Rebalance

<ul>
<li>Friday was the review cutoff for the September rebalance of the ASX family of indices. The September changes for the Hang Seng family of indices were also announced.</li>
<li>The September changes for the <a href="https://www.smartkarma.com/entities/sse-science-and-technology-innovation-board-50-index" target="_blank" data-smartkarma-citation="entities:29279:1" rel="noopener">SSE STAR50 (STAR50 INDEX)</a> will be announced after the close of trading on 25 August.</li>
<li>For a second week running, there were big inflows to mainland China ETFs and were spread across multiple index trackers. There were outflows from <a href="https://www.smartkarma.com/entities/ishares-msci-emerging-markets" target="_blank" data-smartkarma-citation="entities:438:1" rel="noopener">iShares Emerging Markets (EEM US)</a>. </li>
</ul>


Friday was the review cutoff for the September rebalance of the ASX family of indices. The September changes for the Hang Seng family of indices were also announced.
The September changes for the SSE STAR50 (STAR50 INDEX) will be announced after the close of trading on 25 August.
For a second week running, there were big inflows to mainland China ETFs and were spread across multiple index trackers. There were outflows from iShares Emerging Markets (EEM US). 


Index Rebalance & ETF Flow Recap: ASX, NEXT50, MVMVA, MVMVW, Celltrion, Brilliance, KQ150, HSCI

<ul>
<li>There could be two deletes for the index in September. There are two other stocks that are close to the deletion threshold.</li>
<li>Even if there are no constituent changes, there will be capping changes that will result in one-way turnover of around 2.7% and a one-way trade of A$51m.</li>
<li>Short interest has been increasing on <a href="https://www.smartkarma.com/entities/charter-hall-group" target="_blank" data-smartkarma-citation="entities:5593:1" rel="noopener">Charter Hall (CHC AU)</a> and <a href="https://www.smartkarma.com/entities/jb-hi-fi-ltd" target="_blank" data-smartkarma-citation="entities:555:1" rel="noopener">JB Hi-Fi Ltd (JBH AU)</a> and could be partially driven by potential index deletions.</li>
</ul>


There could be two deletes for the index in September. There are two other stocks that are close to the deletion threshold.
Even if there are no constituent changes, there will be capping changes that will result in one-way turnover of around 2.7% and a one-way trade of A$51m.
Short interest has been increasing on Charter Hall (CHC AU) and JB Hi-Fi Ltd (JBH AU) and could be partially driven by potential index deletions.


MVIS Australia Equal Weight Index Rebalance Preview: Deletes, Close Deletes, Capping Changes

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/origin-energy-ltd" target="_blank" data-smartkarma-citation="entities:797:1" rel="noopener">Origin Energy (ORG AU)</a> received a conditional, non-binding indicative proposal from Brookfield and EIG at A$9.00 per share, a 54.9%  premium to the undisturbed price (9 November).</li>
<li>The Board will grant eight weeks of due diligence access and intends to unanimously recommend a binding offer at A$9.00 per share. The offer is attractive.</li>
<li>Regulatory approvals are an overhang and would likely require price concessions. At the last close, the gross spread to the offer is 14.9%.</li>
</ul>



Origin Energy (ORG AU) received a conditional, non-binding indicative proposal from Brookfield and EIG at A$9.00 per share, a 54.9%  premium to the undisturbed price (9 November).
The Board will grant eight weeks of due diligence access and intends to unanimously recommend a binding offer at A$9.00 per share. The offer is attractive.
Regulatory approvals are an overhang and would likely require price concessions. At the last close, the gross spread to the offer is 14.9%.


Origin Energy's (ORG AU) Indicative Offer of A$9.00 from Brookfield/EIG

<ul>
<li>Unsurprisingly, the independent expert (IE) considers the consortium's offer of A$5.00 per share to be fair and reasonable. We think that IE’s valuation approach is sound.  </li>
<li>The key condition is approval from <a href="https://www.smartkarma.com/entities/uniti-group-ltd" target="_blank" data-smartkarma-citation="entities:29042:1" rel="noopener">Uniti Group Ltd (UWL AU)</a> shareholders and regulatory authorities (FIRB). The scheme meeting is scheduled for 9:30 am on 15 July. </li>
<li>We continue to think that offer is attractive. At the last close price and for the 4 August implementation date, the gross and annualised spread is 0.8% and 5.1%, respectively.</li>
</ul>


Unsurprisingly, the independent expert (IE) considers the consortium's offer of A$5.00 per share to be fair and reasonable. We think that IE’s valuation approach is sound.  
The key condition is approval from Uniti Group Ltd (UWL AU) shareholders and regulatory authorities (FIRB). The scheme meeting is scheduled for 9:30 am on 15 July. 
We continue to think that offer is attractive. At the last close price and for the 4 August implementation date, the gross and annualised spread is 0.8% and 5.1%, respectively.


Uniti’s Scheme Meeting on 15 July, IE’s Opinion

Australia

APA Group is a natural gas infrastructure company. The Company owns and or operates gas transmission and distribution assets whose pipelines span every state and territory in mainland Australia. APA Group also holds minority interests in energy infrastructure enterprises.

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APA Group (APA AU)

APA Group Placement - Well Flagged Deal, but Lacks in Accretion

APA Group (APA AU) is looking to raise A$675m (US$430m) in its primary follow-on to partially fund its acquisition of the Alinta Energy assets in...

Clarence Chu

Index Rebalance & ETF Flow Recap: ASX, NEXT50, MVMVA, MVMVW, Celltrion, Brilliance, KQ150, HSCI

This recap highlights Insights covering Asian index rebalances (announcements/ forecasts/ IPO Fast Entry/ M&A driven changes). We also highlight...

Brian Freitas

MVIS Australia Equal Weight Index Rebalance Preview: Deletes, Close Deletes, Capping Changes

With a couple of weeks to review cutoff, there are two stocks in deletion zone and another two that are close to the deletion zone. Most likely, no...

Brian Freitas

Origin Energy's (ORG AU) Indicative Offer of A$9.00 from Brookfield/EIG

The offer is attractive. Regulatory approvals are an overhang and would likely require price concessions. At the last close, the gross spread to...

Arun George

Uniti’s Scheme Meeting on 15 July, IE’s Opinion

We continue to think that offer is attractive. At the last close price and for the 4 August implementation date, the annualised spread is 5.1%.

Arun George

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