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

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<a href="https://www.smartkarma.com/entities/link-net-tbk-pt" target="_blank" data-smartkarma-citation="entities:1050:1" rel="noopener">Link Net (LINK IJ)</a>’s two largest shareholders (66.03% of the outstanding shares) have signed a SPA to sell their stakes to Axiata Investments and <a href="https://www.smartkarma.com/entities/xl-axiata-tbk-pt" target="_blank" data-smartkarma-citation="entities:15028:1" rel="noopener">XL Axiata (EXCL IJ)</a> at IDR4,800.</li>
<li>Post-Completion, Axiata Investments and XL Axiata will then be required to launch a mandatory tender offer to acquire the remaining 33.97% Link Net shares at IDR4,800 per share</li>
<li>The tender offer is expected to be completed in 3Q2022. At the last close price of IDR4,430, the shares are trading at an 8.4% gross spread to the offer.</li>
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Link Net (LINK IJ)’s two largest shareholders (66.03% of the outstanding shares) have signed a SPA to sell their stakes to Axiata Investments and XL Axiata (EXCL IJ) at IDR4,800.
Post-Completion, Axiata Investments and XL Axiata will then be required to launch a mandatory tender offer to acquire the remaining 33.97% Link Net shares at IDR4,800 per share
The tender offer is expected to be completed in 3Q2022. At the last close price of IDR4,430, the shares are trading at an 8.4% gross spread to the offer.


Link Net’s MTO from Axiata Investments and XL Axiata

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

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<p>This week in StubWorld ...</p>
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<p>Decent 2021 interims and continual buybacks have not curbed <a href="https://www.smartkarma.com/entities/first-pacific-co-ltd" target="_blank" data-smartkarma-citation="entities:173:1" rel="noopener">First Pacific Co (142 HK)</a>'s recent underperformance, with the market assigning US$300mn <em>less</em> for the stub ops than before.</p>
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<p>Preceding my comments on First Pac are the weekly setup/unwind tables for Asia-Pacific Holdcos.</p>
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<p>These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.</p>
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This week in StubWorld ...



Decent 2021 interims and continual buybacks have not curbed First Pacific Co (142 HK)'s recent underperformance, with the market assigning US$300mn less for the stub ops than before.



Preceding my comments on First Pac are the weekly setup/unwind tables for Asia-Pacific Holdcos.


These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.


StubWorld: First Pac (142 HK)'s Correction After Year-Long Contraction

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

Converge ICT Solutions Inc / Equity Capital Markets

<div><p>Converge ICT (CICT) raised around US$520m in its Philippines listing.</p></div><div><p>Converge ICT is the largest high-speed fixed broadband operator in the Philippines, by high-speed residential fixed broadband subscriptions. It also claims to be the fastest growing fixed broadband operator in both the residential and enterprise market.</p></div><div><p>I have covered various aspects of the deal in my prior notes, links to which are below. In this note, I'll talk about the updates since then and provide a table with implied valuation at different share price levels.</p></div><div><p>Links to my previous notes:</p></div><div><ul style="list-style-type: disc;">
<li dir="ltr"><p><a href="https://www.smartkarma.com/insights/converge-ict-pre-ipo-fast-growth-low-penetration-covid-resistant" target="_blank" rel="noopener">Converge ICT Pre-IPO - Fast growth, low penetration, COVID resistant</a></p></li>
<li dir="ltr"><p><a href="https://www.smartkarma.com/insights/converge-ict-pre-ipo-peer-comparison-not-a-clear-cut-winner" target="_blank" rel="noopener">Converge ICT Pre-IPO - Peer comparison - Not a clear cut winner</a></p></li>
</ul></div><div><ul style="list-style-type: disc;">
<li dir="ltr"><p><a href="https://www.smartkarma.com/insights/converge-ict-pre-ipo-thoughts-on-valuation" target="_blank" rel="noopener">Converge ICT Pre-IPO - Thoughts on valuation</a></p></li>
<li dir="ltr"><a href="https://www.smartkarma.com/insights/converge-ict-ipo-more-customers-lower-arpu" target="_blank" rel="noopener">Converge ICT IPO - More Customers, Lower ARPU</a></li>
</ul></div>

Converge ICT (CICT) raised around US$520m in its Philippines listing.Converge ICT is the largest high-speed fixed broadband operator in the Philippines, by high-speed residential fixed broadband subscriptions. It also claims to be the fastest growing fixed broadband operator in both the residential and enterprise market.I have covered various aspects of the deal in my prior notes, links to which are below. In this note, I'll talk about the updates since then and provide a table with implied valuation at different share price levels.Links to my previous notes:
Converge ICT Pre-IPO - Fast growth, low penetration, COVID resistant
Converge ICT Pre-IPO - Peer comparison - Not a clear cut winner

Converge ICT Pre-IPO - Thoughts on valuation
Converge ICT IPO - More Customers, Lower ARPU


Converge ICT IPO Trading - Long Growth Runway

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<p><a href="https://www.smartkarma.com/entities/converge-ict-solutions-inc" target="_blank" data-smartkarma-citation="entities:29215:1" rel="noopener">Converge ICT Solutions Inc (ITC PM)</a> is the only major pure-play fixed broadband provider, with an exclusive focus on serving the Philippine fixed broadband market. Converge has set its IPO price range of PHP16.50-19.00 per share. At the high-end of the IPO price range, Converge will raise proceeds of $591 million (primary/secondary split of 32%/68%). Pricing has been brought forward by a day to 8 October.</p>
<p>Eight cornerstone investors will subscribe for 38.6% of the offer shares at the high-end of the IPO price range. The cornerstone investors are Genesis Investment Management, Ghisallo Master Fund, Macquarie Funds Management, Magna New Frontiers Fund, Oaks Emerging and Frontier Opportunities Fund, OMERS, Segantii Capital Management and Thornburg Investment Management. </p>
</div><div><div><div class="content-highlight"><p>In <a href="https://www.smartkarma.com/insights/converge-ict-solutions-ipo-making-the-connection" target="_blank" rel="noopener">our previous note</a>, we highlighted that the 1H20 results reinforce our view that Converge’s fundamentals are attractive. Overall, we think that an attractive PEG valuation, a market-leading business and solid cornerstone support makes Converge tempting at the proposed pricing range. </p></div></div></div>


Converge ICT Solutions Inc (ITC PM) is the only major pure-play fixed broadband provider, with an exclusive focus on serving the Philippine fixed broadband market. Converge has set its IPO price range of PHP16.50-19.00 per share. At the high-end of the IPO price range, Converge will raise proceeds of $591 million (primary/secondary split of 32%/68%). Pricing has been brought forward by a day to 8 October.
Eight cornerstone investors will subscribe for 38.6% of the offer shares at the high-end of the IPO price range. The cornerstone investors are Genesis Investment Management, Ghisallo Master Fund, Macquarie Funds Management, Magna New Frontiers Fund, Oaks Emerging and Frontier Opportunities Fund, OMERS, Segantii Capital Management and Thornburg Investment Management. 
In our previous note, we highlighted that the 1H20 results reinforce our view that Converge’s fundamentals are attractive. Overall, we think that an attractive PEG valuation, a market-leading business and solid cornerstone support makes Converge tempting at the proposed pricing range. 

Converge ICT Solutions IPO: Valuation Insights

<p>Converge ICT (CICT) is looking to raise around US$600m in its Philippines listing.</p><p>Converge ICT is the largest high-speed fixed broadband operator in the Philippines, by high-speed residential fixed broadband subscriptions. It also claims to be the fastest growing fixed broadband operator in both the residential and enterprise market.</p><p>CICT’s revenue has grown at 69% CAGR over FY16-19, with growth being led by its residential business whose revenue has increased at 95% CAGR. Gross profit grew at 56% CAGR, EBITDA at 91% CAGR and Net profit at 60% CAGR. In other words, most of the revenue growth has flowed down to the bottom line. </p><p>I have covered the company background, undertaken a peer comparison and spoken about valuation in my earlier reports, links to which are below. In this note, I’ll talk about deal dynamics and recent updates from the prospectus.</p><p>Links to my previous notes:</p><ul>
<li dir="ltr"><p><a href="https://www.smartkarma.com/insights/converge-ict-pre-ipo-fast-growth-low-penetration-covid-resistant" target="_blank" rel="noopener">Converge ICT Pre-IPO - Fast growth, low penetration, COVID resistant</a></p></li>
<li dir="ltr"><p><a href="https://www.smartkarma.com/insights/converge-ict-pre-ipo-peer-comparison-not-a-clear-cut-winner" target="_blank" rel="noopener">Converge ICT Pre-IPO - Peer comparison - Not a clear cut winner</a></p></li>
</ul><ul><li dir="ltr"><p><a href="https://www.smartkarma.com/insights/converge-ict-pre-ipo-thoughts-on-valuation" target="_blank" rel="noopener">Converge ICT Pre-IPO - Thoughts on valuation</a></p></li></ul>

Converge ICT (CICT) is looking to raise around US$600m in its Philippines listing.Converge ICT is the largest high-speed fixed broadband operator in the Philippines, by high-speed residential fixed broadband subscriptions. It also claims to be the fastest growing fixed broadband operator in both the residential and enterprise market.CICT’s revenue has grown at 69% CAGR over FY16-19, with growth being led by its residential business whose revenue has increased at 95% CAGR. Gross profit grew at 56% CAGR, EBITDA at 91% CAGR and Net profit at 60% CAGR. In other words, most of the revenue growth has flowed down to the bottom line. I have covered the company background, undertaken a peer comparison and spoken about valuation in my earlier reports, links to which are below. In this note, I’ll talk about deal dynamics and recent updates from the prospectus.Links to my previous notes:
Converge ICT Pre-IPO - Fast growth, low penetration, COVID resistant
Converge ICT Pre-IPO - Peer comparison - Not a clear cut winner
Converge ICT Pre-IPO - Thoughts on valuation

Converge ICT IPO - More Customers, Lower ARPU

Philippines

PLDT, Inc. is a leading telecommunications, internet, and digital service company in the Philippines. It provides a wide range of services, including fixed-line, wireless, and fiber optic communication solutions, broadband internet, and mobile telephony services through various brands like Smart and TNT. The company offers cellular mobile, ICT solutions, cloud computing, cybersecurity, data center services, and fintech solutions. PLDT is headquartered in Makati City, Philippines, and was founded on November 28, 1928.

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PLDT (TEL PM)

Link Net’s MTO from Axiata Investments and XL Axiata

The two largest shareholders have agreed to sell their stakes to Axiata Investments and XL Axiata at IDR4,800. Post completion, the two buyers will...

Arun George

StubWorld: First Pac (142 HK)'s Correction After Year-Long Contraction

in the short term, absent a major catalyst, I'd like to see the share price settle a bit. Longer-term, this appears a decent entry point, with a...

David Blennerhassett

Converge ICT IPO Trading - Long Growth Runway

Converge ICT (CICT) raised around US$520m in its Philippines listing. Converge ICT is the largest high-speed fixed broadband operator in the...

Sumeet Singh

Converge ICT Solutions IPO: Valuation Insights

Chindata (CD US) is a data centre operator which is backed by Bain Capital (57.17% shareholder), APG Strategic Real Estate Pool/Dutch pension...

Arun George

Converge ICT IPO - More Customers, Lower ARPU

Converge ICT (CICT) aims to raise around US$600m in its Philippines listing. Converge ICT is the largest high-speed fixed broadband operator in the...

Sumeet Singh

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