Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, 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

<div><p><a href="https://www.smartkarma.com/entities/scg-packaging-public-company-limited" target="_blank" data-smartkarma-citation="entities:28684:1" rel="noopener">SCG Packaging (SCGP TB)</a> raise around US$1.2bn in its Thailand IPO. It is a part of the <a href="https://www.smartkarma.com/entities/siam-cement-pcl-the" target="_blank" data-smartkarma-citation="entities:2589:1" rel="noopener">Siam Cement (SCC TB)</a> group.</p></div><div><p>SCGP is a packaging solutions provider in ASEAN offering fiber-based packaging, performance and polymer packaging, food service products, design, printing and other solutions. SCGP is the largest packaging paper and corrugated containers producer in ASEAN, as per Frost &amp; Sullivan. </p></div><div>I have covered various aspects of the deal in my earlier notes:</div><div><ul>
<li><a href="https://www.smartkarma.com/insights/scg-packaging-pre-ipo-shift-to-packaging-has-been-aiding-margins-but-acquisition-drove-up-leverage" target="_blank" rel="noopener">SCG Packaging Pre-IPO - Shift to packaging has been aiding margins but acquisitions have driven up leverage</a></li>
<li><a href="https://www.smartkarma.com/insights/scg-packaging-ipo-unexciting" target="_blank" rel="noopener">SCG Packaging IPO - Unexciting</a></li>
</ul></div><p>In this note, I'll talk about the deal updates and provide implied valuations at different share price levels.</p>

SCG Packaging (SCGP TB) raise around US$1.2bn in its Thailand IPO. It is a part of the Siam Cement (SCC TB) group.SCGP is a packaging solutions provider in ASEAN offering fiber-based packaging, performance and polymer packaging, food service products, design, printing and other solutions. SCGP is the largest packaging paper and corrugated containers producer in ASEAN, as per Frost &amp; Sullivan. I have covered various aspects of the deal in my earlier notes:
SCG Packaging Pre-IPO - Shift to packaging has been aiding margins but acquisitions have driven up leverage
SCG Packaging IPO - Unexciting
In this note, I'll talk about the deal updates and provide implied valuations at different share price levels.

SCG Packaging IPO Trading - Placed with Domestics

Equity Analyst, LightStream Research

Supun Walpola

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

<p>In our previous note, <a href="https://www.smartkarma.com/insights/scg-packaging-ipo-short-term-catalysts-are-not-attractive" target="_blank" data-smartkarma-citation="insights:43675" rel="noopener">SCG Packaging IPO: Short-Term Catalysts Are Not Attractive</a>, we suggested that, while we like SCGP for its longer-term prospects, the company’s short-term performance is likely to be hindered by the sluggish Thai economy. However, we believe these short-term risks are compensated through the company’s valuation, which looks attractive to us even at the higher-end of the indicative IPO price range. We would consider subscribing to the IPO but would not rule out the possibility of a pullback in the short-run under margins pressure.</p>

In our previous note, SCG Packaging IPO: Short-Term Catalysts Are Not Attractive, we suggested that, while we like SCGP for its longer-term prospects, the company’s short-term performance is likely to be hindered by the sluggish Thai economy. However, we believe these short-term risks are compensated through the company’s valuation, which looks attractive to us even at the higher-end of the indicative IPO price range. We would consider subscribing to the IPO but would not rule out the possibility of a pullback in the short-run under margins pressure.

SCG Packaging IPO: Risks-Rewards Attractive at the Higher-End of the IPO Price Range

Thai Equity - Bottom-up - Equities, Pi Securities PCL, Thailand

Pi Research

Thai Equity - Bottom-up - Equities

Leading, full-service investment firm in Thailand

Pi Securities PCL, Thailand

Pi Securities is a well known securities company with 40 years experience in the industry, serving more than 60,000 clients. We offer one - stop service providing full range of financial products and services including extensive Brokerage, Proprietary Trading (Equities and Bonds), Advisory Services, Structured Products.

Moreover, our new research team tailored for institutional clients to focus on mid to small cap of Thai equities and trading strategies. Our services offered to our premium clients also include arrangement of company or site visits to with the managements of Thai listed companies.

Note: Effective on 1 March 2022, Country Group Securities PCL changed its name to Pi Securities

Equity Bottom-Up

<p><strong>We maintain our BUY rating and roll over our target price to Bt141 based on 35xPE’21E (Previous TP is Bt110), the average of the Thailand energy drink group.</strong></p>
<ul>
<li>2Q20 net profit of Bt881m (+60%YoY,+10%QoQ) is the record level. The YoY growth was driven by sales growth at 20%YoY to Bt4.5bn especially from CLMV sales of Bt1.8bn (+41%YoY) and liquor’s distribution sales of Bt598m (+90%YoY). 1H20 was Bt1.7bn (+73%YoY) which is above our previous forecast and better than our expectation and the street.</li>
<li>Revised up 2020-21E earnings forecast by 7% and 11%, respectively.</li>
<li>We expect 3Q20 earnings continue to break the record level given continuing growth momentum from CLMV and liquor’s distribution.</li>
<li>The price correction after 2Q20 result announcement should provide an opportunity to accumulate the stock for long-term investment.</li>
</ul>
<p><strong>We still like CBG for its 1) Bright outlook in CLMV energy drinks; 2) Potential growth from china markets; 3) New S-Curve from new product (WOODY C+ LOCK); and 4) Solid liquor’s distribution sales growth momentum.</strong></p>

We maintain our BUY rating and roll over our target price to Bt141 based on 35xPE’21E (Previous TP is Bt110), the average of the Thailand energy drink group.

2Q20 net profit of Bt881m (+60%YoY,+10%QoQ) is the record level. The YoY growth was driven by sales growth at 20%YoY to Bt4.5bn especially from CLMV sales of Bt1.8bn (+41%YoY) and liquor’s distribution sales of Bt598m (+90%YoY). 1H20 was Bt1.7bn (+73%YoY) which is above our previous forecast and better than our expectation and the street.
Revised up 2020-21E earnings forecast by 7% and 11%, respectively.
We expect 3Q20 earnings continue to break the record level given continuing growth momentum from CLMV and liquor’s distribution.
The price correction after 2Q20 result announcement should provide an opportunity to accumulate the stock for long-term investment.

We still like CBG for its 1) Bright outlook in CLMV energy drinks; 2) Potential growth from china markets; 3) New S-Curve from new product (WOODY C+ LOCK); and 4) Solid liquor’s distribution sales growth momentum.

Asean-focused. Ex-Head of Thai Research

Athaporn Arayasantiparb, CFA

Asean (Thailand) Focused Independent Research

M Corp Review

M Corp is led by Athaporn Arayasantiparb who served as Head of Research for UOB and ANZ in Thailand and was an award-winning telecoms analyst at UBS in 2010 (AsiaMoney Thailand category) and Regional Strategist for DMG in Singapore. Prior to that, he also served as Kasikornbank credit analyst and scholar. He has a total work experience of 17 years, of which 14 were in research and 4 in research management roles. He started his career as an engineer for PTT and currently manages family investments. He holds an MBA from Stern (NYU) and CFA Charter since 2006. Apart from IPO Radar, which focuses on future listings, MCorp Review also provides six on-going thematic series ranked by frequency in descending order, namely: 1) Silicon Stories (technology) 2) Sathorn Series (financial services) 3) Thai-Coons (billionaire origin stories) 4) Reality Check (data-driven, investigative) 5) Thai Media Spotlight; and 6) Thai Macro Watch (global market drivers).

<p>We visited consumer products giant Osotspa, manufacturer of top-selling energy drinks M-100 and liquid Vitamin C C-Vitt, and petrochemicals giant Indorama. Some key pointers from the meeting:</p><ul>
<li>
<strong>Osotspa</strong> reported Q1'20 earnings of Bt926m (up 4.2%) on the back of Bt6,687m revenues (up 5%) driven by functional drink sales growth of 26.2%, especially for C-Vitt (liquid Vitamin C) and Calpis.</li>
<li>The company expects to cut costs by more than Bt800m and minimized sugar tax by lowering its content. They also bought out Asahi from the Calpis Osotspa venture and have earmarked almost Bt4bn in investments this year.</li>
<li>
<strong>Indorama's EBITDA </strong>jumped 51% QoQ to US$304m on the back of a 15% revenue growth to US$2.9bn. Operations were strong on an all-rounded basis with demand improving for almost every geography and product</li>
<li>Indorama also gained access to Thailand's first 'green loan' of US$200m and 200m euros offered by Japan's <strong>Mizuho</strong> Bank.</li>
</ul>

We visited consumer products giant Osotspa, manufacturer of top-selling energy drinks M-100 and liquid Vitamin C C-Vitt, and petrochemicals giant Indorama. Some key pointers from the meeting:

Osotspa reported Q1'20 earnings of Bt926m (up 4.2%) on the back of Bt6,687m revenues (up 5%) driven by functional drink sales growth of 26.2%, especially for C-Vitt (liquid Vitamin C) and Calpis.
The company expects to cut costs by more than Bt800m and minimized sugar tax by lowering its content. They also bought out Asahi from the Calpis Osotspa venture and have earmarked almost Bt4bn in investments this year.

Indorama's EBITDA jumped 51% QoQ to US$304m on the back of a 15% revenue growth to US$2.9bn. Operations were strong on an all-rounded basis with demand improving for almost every geography and product
Indorama also gained access to Thailand's first 'green loan' of US$200m and 200m euros offered by Japan's Mizuho Bank.


Osotspa, Indorama: Strong Operations Amidst Pandemic

APAC IPOs & Placements

Zhen Zhou, Toh

<p>The Osathanugrah family, specifically Petch Osathanugrah, Puree Osathanugrah, Purat Osathanugrah and Orizon Limited, are looking to sell their shares in <a href="https://www.smartkarma.com/entities/osotspa-pcl" target="_blank" data-smartkarma-citation="entities:27004:1" rel="noopener">Osotspa Co Ltd (OSP TB)</a> worth about US$108m. Post-selldown, the family's core holdings through The Orizon Group still has a 27.9% stake in Osotspa.</p><p>We have earlier covered the IPO in:</p><ul>
<li>
<a href="https://www.smartkarma.com/insights/osotspa-ipo-review-valuation-discount-to-carabao-to-reflect-market-share-loss-and-slower-growth" target="_blank" data-smartkarma-citation="insights:24463" rel="noopener">Osotspa IPO Review - Valuation Discount to Carabao to Reflect Market Share Loss and Slower Growth</a> </li>
<li>
<a href="https://www.smartkarma.com/insights/osotspa-post-ipo-trading-update-14-above-ipo-price-but-no-longer-a-screaming-buy" target="_blank" data-smartkarma-citation="insights:25123" rel="noopener">Osotspa Post-IPO Trading Update - 14% Above IPO Price but No Longer a Screaming Buy</a> </li>
</ul><p>In this note, we will look take a look at the company's fundamentals, deal dynamics, and run the deal through our framework.</p>

The Osathanugrah family, specifically Petch Osathanugrah, Puree Osathanugrah, Purat Osathanugrah and Orizon Limited, are looking to sell their shares in Osotspa Co Ltd (OSP TB) worth about US$108m. Post-selldown, the family's core holdings through The Orizon Group still has a 27.9% stake in Osotspa.We have earlier covered the IPO in:

Osotspa IPO Review - Valuation Discount to Carabao to Reflect Market Share Loss and Slower Growth 

Osotspa Post-IPO Trading Update - 14% Above IPO Price but No Longer a Screaming Buy 
In this note, we will look take a look at the company's fundamentals, deal dynamics, and run the deal through our framework.

Osotspa Placement - Resilient Business but Founding Family Is Selling

Thailand

Osotspa is a leading Thai manufacturer and distributor of consumer products, primarily focusing on beverages, personal care, healthcare, and confectionery products. Its beverage portfolio includes energy drinks like M-150 and Shark Energy, sports drinks, and functional drinks. The company also offers baby care, women's beauty care, and male grooming products. Osotspa is headquartered in Bangkok, Thailand, and was founded in 1891.

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Osotspa (OSP TB)

SCG Packaging IPO Trading - Placed with Domestics

SCG Packaging (SCGP TB) raised around US$1.2bn in its Thailand IPO. Given its lack of growth in the past, we remain less than excited, to put it...

Sumeet Singh

SCG Packaging IPO: Risks-Rewards Attractive at the Higher-End of the IPO Price Range

In our previous note, SCG Packaging IPO: Short-Term Catalysts Are Not Attractive, we suggested that, while we like SCGP for its longer-term...

Supun Walpola

CBG: Trading on High Valuation Zone

We maintain our BUY rating and roll over our target price to Bt141 based on 35xPE’21E (Previous TP is Bt110), the average of the Thailand energy...

Pi Securities PCL, Thailand

Osotspa, Indorama: Strong Operations Amidst Pandemic

We visited consumer products giant Osotspa, manufacturer of top-selling energy drinks M-100 and liquid Vitamin C C-Vitt, and petrochemicals giant...

Athaporn Arayasantiparb, CFA

Osotspa Placement - Resilient Business but Founding Family Is Selling

The Osathanugrah family, specifically Petch Osathanugrah, Puree Osathanugrah, Purat Osathanugrah and Orizon Limited, are looking to sell their...

Zhen Zhou, Toh

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