Covering IPOs, Healthcare and Technology Stocks

Andrei Zakharov

Equity Bottom-Up

<ul>
<li>4Paradigm, a self-developed AI platform and scenario-specific AI applications provider, has completed an IPO and raised net proceeds of ~HK$836M, excluding the over-allotment option. </li>
<li>Founder-Led AI unicorn priced its IPO at the bottom end of the range at HK$55.60 per share. Cornerstone investors agreed to purchase ~13.6M H shares at the IPO price. </li>
<li>I like the company’s leadership position in China’s fastest-growing decision-making AI market, large TAM for their enterprise-grade generative AI offering SageGPT and top-tier VC investors. </li>
</ul>


4Paradigm, a self-developed AI platform and scenario-specific AI applications provider, has completed an IPO and raised net proceeds of ~HK$836M, excluding the over-allotment option. 
Founder-Led AI unicorn priced its IPO at the bottom end of the range at HK$55.60 per share. Cornerstone investors agreed to purchase ~13.6M H shares at the IPO price. 
I like the company’s leadership position in China’s fastest-growing decision-making AI market, large TAM for their enterprise-grade generative AI offering SageGPT and top-tier VC investors. 


4Paradigm: Fears About The Entity List Are Exaggerated, Bullish On AI and SageGPT, PT: HK$86

Equity Analyst, LightStream Research

Shifara Samsudeen, ACMA, CGMA

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.

Equity Capital Markets

<ul>
<li>4Paradigm has priced its IPO at HK$55.60 per share, at the bottom end of the indicative IPO price range of HK$55.6-61.16 per share and raised net proceeds of HK$835.5m.</li>
<li>The HK offering and the international offering of the company were oversubscribed by 11.4x and 1.57x respectively implying very moderate demand for the company’s shares.</li>
<li>Though priced at the bottom of the indicative IPO price range, our analysis suggests that 4Paradigm’s IPO is still expensive.</li>
</ul>


4Paradigm has priced its IPO at HK$55.60 per share, at the bottom end of the indicative IPO price range of HK$55.6-61.16 per share and raised net proceeds of HK$835.5m.
The HK offering and the international offering of the company were oversubscribed by 11.4x and 1.57x respectively implying very moderate demand for the company’s shares.
Though priced at the bottom of the indicative IPO price range, our analysis suggests that 4Paradigm’s IPO is still expensive.


4Paradigm IPO: Thoughts on First Day Trading

APAC IPOs & Placements, Aequitas Research

Ethan Aw

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.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/4paradigm" target="_blank" data-smartkarma-citation="entities:34465:1" rel="noopener">4Paradigm (6682 HK)</a> raised around US$131m in its Hong Kong IPO. </li>
<li>4P is a platform-centric AI enterprise solutions provider. It was the largest player by revenue in the platform-centric decision-making AI market in China in 2022, as per CIC. </li>
<li>We have covered various aspects of the deal in our previous notes. In this note, we will talk about the demand and trading dynamics.</li>
</ul>



4Paradigm (6682 HK) raised around US$131m in its Hong Kong IPO. 
4P is a platform-centric AI enterprise solutions provider. It was the largest player by revenue in the platform-centric decision-making AI market in China in 2022, as per CIC. 
We have covered various aspects of the deal in our previous notes. In this note, we will talk about the demand and trading dynamics.


4Paradigm IPO Trading - Low Insti Subscription and Small Float

<ul>
<li>4Paradigm has announced the terms for its IPO. The company plans to raise gross proceeds of $131-144m through issuing 18.4m shares at an indicative price range of HK$55.6-61.16 per shares.</li>
<li>The company’s IPO is timed perfectly when AI adoption is expected to expand on a large scale with the popularity of ChatGPT and other AI applications.</li>
<li>Though we liked <a href="https://www.smartkarma.com/entities/4paradigm" target="_blank" data-smartkarma-citation="entities:34465:1" rel="noopener">4Paradigm (1764934D HK)</a> for its improving financials and growth prospects, our analysis suggests that the IPO is expensive.</li>
</ul>


4Paradigm has announced the terms for its IPO. The company plans to raise gross proceeds of $131-144m through issuing 18.4m shares at an indicative price range of HK$55.6-61.16 per shares.
The company’s IPO is timed perfectly when AI adoption is expected to expand on a large scale with the popularity of ChatGPT and other AI applications.
Though we liked 4Paradigm (1764934D HK) for its improving financials and growth prospects, our analysis suggests that the IPO is expensive.


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.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/4paradigm" target="_blank" data-smartkarma-citation="entities:34465:1" rel="noopener">4Paradigm (1764934D HK)</a>, a leader in enterprise artificial intelligence (AI) in China, has launched an HKEx IPO to raise up to US$144 million.</li>
<li>We previously discussed the IPO in <a href="https://www.smartkarma.com/insights/4paradigm-ipo-the-bull-case" target="_blank" data-smartkarma-citation="insights:112776" rel="noopener">4Paradigm IPO: The Bull Case</a> and <a href="https://www.smartkarma.com/insights/4paradigm-ipo-the-bear-case" target="_blank" data-smartkarma-citation="insights:112894" rel="noopener">4Paradigm IPO: The Bear Case</a>. </li>
<li>In this note, we discuss forecasts and valuation. Our analysis suggests that the IPO price range of HK$55.60-61.16 per share is unattractive. We would give the IPO a pass.</li>
</ul>



4Paradigm (1764934D HK), a leader in enterprise artificial intelligence (AI) in China, has launched an HKEx IPO to raise up to US$144 million.
We previously discussed the IPO in 4Paradigm IPO: The Bull Case and 4Paradigm IPO: The Bear Case. 
In this note, we discuss forecasts and valuation. Our analysis suggests that the IPO price range of HK$55.60-61.16 per share is unattractive. We would give the IPO a pass.


China

Beijing 4Paradigm Technology Co. Ltd. operates as an artificial intelligence technology service provider. The Company provides model self-learning, data cleaning free, interpreted complex model, human computer cooperation, and other services. Beijing 4Paradigm Technology applies its technology in financial, government, energy, manufacturing, retail, medical, and other fields.

4Paradigm (6682 HK)

4Paradigm: Fears About The Entity List Are Exaggerated, Bullish On AI and SageGPT, PT: HK$86

4Paradigm, a Beijing-based enterprise AI software company, has completed its IPO in Hong Kong. I maintain a bullish view of the stock, and my PT of...

Andrei Zakharov

4Paradigm IPO: Thoughts on First Day Trading

4Paradigm has priced its IPO at HK$55.60 per share, at the bottom end of the price range. The company's IPO was moderately oversubscribed but...

Shifara Samsudeen, ACMA, CGMA

4Paradigm IPO Trading - Low Insti Subscription and Small Float

4Paradigm (6682 HK) raised around US$131m in its Hong Kong IPO. We have covered various aspects of the deal in our previous notes. In this note, we...

Ethan Aw

4Paradigm IPO: Forecasts and Valuation

4Paradigm's IPO is timed perfectly for the expected expansion of AI adoption. Though we liked the company for improving financials and growth...

Shifara Samsudeen, ACMA, CGMA

4Paradigm IPO: Valuation Insights

4Paradigm has launched an HKEx IPO to raise up to US$144m. Our analysis suggests that the IPO price range is unattractive. We would give the IPO a...

Arun George

4Paradigm: Fears About The Entity List Are Exaggerated, Bullish On AI and SageGPT, PT: HK$86

4Paradigm, a Beijing-based enterprise AI software company, has completed its IPO in Hong Kong. I maintain a bullish view of the stock, and my PT of...

Andrei Zakharov

4Paradigm IPO: Thoughts on First Day Trading

​4Paradigm has priced its IPO at HK$55.60 per share, at the bottom end of the price range. The company's IPO was moderately oversubscribed but...

Shifara Samsudeen, ACMA, CGMA

4Paradigm IPO Trading - Low Insti Subscription and Small Float

4Paradigm (6682 HK) raised around US$131m in its Hong Kong IPO. We have covered various aspects of the deal in our previous notes. In this note, we...

Ethan Aw

4Paradigm IPO: Forecasts and Valuation

​4Paradigm's IPO is timed perfectly for the expected expansion of AI adoption. Though we liked the company for improving financials and growth...

Shifara Samsudeen, ACMA, CGMA

4Paradigm IPO: Valuation Insights

4Paradigm has launched an HKEx IPO to raise up to US$144m. Our analysis suggests that the IPO price range is unattractive. We would give the IPO a...

Arun George

4Paradigm has priced its IPO at HK$55.60 per share, at the bottom end of the price range. The company's IPO was moderately oversubscribed but...

4Paradigm's IPO is timed perfectly for the expected expansion of AI adoption. Though we liked the company for improving financials and growth...