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/coupang" target="_blank" data-smartkarma-citation="entities:28425:1" rel="noopener">Coupang (CPNG US)</a> , the largest product e-commerce player in Korea, aims to raise around US$3bn in its US listing via a mix of selling primary and secondary shares. As per media reports, the company has earlier obtained investments from Sequoia, Softbank, Blackrock and Fidelity.</p></div><div><p>Coupang offers its 14.8m customers a wide range of owned-inventory selection. In addition, on its marketplace it also offers millions of SKUs sourced from over 200,000 merchants. Apart from normal e-commerce operation, it also provides its customers with: grocery offering, Rocket Fresh; logistics food delivery offering, Coupang Eats; and digital financial services, Coupang Pay.</p></div><p>In my earlier insight,  <a href="https://www.smartkarma.com/insights/coupang-pre-ipo-the-positives-fast-growth-sticky-customers" target="_blank" rel="noopener">Coupang Pre-IPO - The Positives - Fast Growth, Sticky Customers</a>, I spoke about the positive aspects of the deal. In this insight, I'll talk about the not so pleasing aspects of the deal.</p>

Coupang (CPNG US) , the largest product e-commerce player in Korea, aims to raise around US$3bn in its US listing via a mix of selling primary and secondary shares. As per media reports, the company has earlier obtained investments from Sequoia, Softbank, Blackrock and Fidelity.Coupang offers its 14.8m customers a wide range of owned-inventory selection. In addition, on its marketplace it also offers millions of SKUs sourced from over 200,000 merchants. Apart from normal e-commerce operation, it also provides its customers with: grocery offering, Rocket Fresh; logistics food delivery offering, Coupang Eats; and digital financial services, Coupang Pay.In my earlier insight,  Coupang Pre-IPO - The Positives - Fast Growth, Sticky Customers, I spoke about the positive aspects of the deal. In this insight, I'll talk about the not so pleasing aspects of the deal.

Coupang Pre-IPO - The Negatives - Horrendous Data Disclosures, Including No Mention of OTT Launch

Chart based progressive global trading strategies, Chart Partners

Thomas Schroeder

Chart based progressive global trading strategies

Chart Partners

Chart Partners objective is to discover medium-term cycle turns and profit opportunities before they unfold, within structural trends while preserving capital with clear degrees of risk. We have real return ideas. 

Markets are dynamic and trading systems must reflect this. It is crucial to determine underlying correlations and lead-lag relationships within global markets and the impact on linked instruments. Our weekly Chartonics product gives you short-term trading strategies that can be applied within the medium and longer term macro trends that are mapped out in our strategy updates. 

Our methodology fuses global market variables and isolates drivers in trends. We specialize in FX, index trade in NY and Asia with a focus on Asian stocks. 

Technical Analysis

<p><a href="https://www.smartkarma.com/entities/alibaba-group" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba Group (9988 HK)</a> exhibits good macro upside potential from our January buy call in the 220 zone but does face some near term resistance as a rally stall zone. We continue to like  BABA on a pullback with focus support at 245-50. BABA US is front running a new high and will lure BABA HK higher in coming sessions but watch out for a pending pullback cycle. BABA is lagging the tech bull cycle and does show catch up potential into 2022.</p>

Alibaba Group (9988 HK) exhibits good macro upside potential from our January buy call in the 220 zone but does face some near term resistance as a rally stall zone. We continue to like  BABA on a pullback with focus support at 245-50. BABA US is front running a new high and will lure BABA HK higher in coming sessions but watch out for a pending pullback cycle. BABA is lagging the tech bull cycle and does show catch up potential into 2022.

Equity Analyst, LightStream Research

Oshadhi Kumarasiri

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><a href="https://www.smartkarma.com/entities/coupang" target="_blank" data-smartkarma-citation="entities:28425:1" rel="noopener">Coupang (CPNG US)</a>, the largest e-commerce company in South Korea with $12.0bn in annual revenue, filed for an NYSE IPO under the ticker “CPNG” with a placeholder value of $1.0bn.</p><p>Coupang is fundamentally different from other e-commerce companies as it generates around 92.2% of the total revenue from the owned inventory segment. The company’s COGS is over 83% of revenue compared to marketplace players like <a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd" target="_blank" data-smartkarma-citation="entities:787:1" rel="noopener">Alibaba Group (BABA US)</a>’s 57% and <a href="https://www.smartkarma.com/entities/pinduoduo-inc" target="_blank" data-smartkarma-citation="entities:27250:1" rel="noopener">Pinduoduo (PDD US)</a>’s 22%. Inherently, Coupang is incapable of generating gross margins comparable with e-commerce marketspace players due to its dependence on own inventory sales.</p><p>Around 29% of South Korea’s total population is active Coupang customers, yet the company made an operating loss of $528m in 2020. Moreover, the company’s revenue increased 91% YoY in 2020 to $12.0bn driven by 25.9% YoY and 59% YoY active customer growth and revenue per active customer growth respectively. However, 2020 operating loss declined just $116m. It is an indication that Coupang’s margin expansion potential is greatly exhausted.</p><p>There is significant revenue growth potential in Coupang. However, we don’t expect revenue growth to translate into profits. Thus, the $50.0bn valuation suggested by various media reports seems extremely optimistic.</p>

Coupang (CPNG US), the largest e-commerce company in South Korea with $12.0bn in annual revenue, filed for an NYSE IPO under the ticker “CPNG” with a placeholder value of $1.0bn.Coupang is fundamentally different from other e-commerce companies as it generates around 92.2% of the total revenue from the owned inventory segment. The company’s COGS is over 83% of revenue compared to marketplace players like Alibaba Group (BABA US)’s 57% and Pinduoduo (PDD US)’s 22%. Inherently, Coupang is incapable of generating gross margins comparable with e-commerce marketspace players due to its dependence on own inventory sales.Around 29% of South Korea’s total population is active Coupang customers, yet the company made an operating loss of $528m in 2020. Moreover, the company’s revenue increased 91% YoY in 2020 to $12.0bn driven by 25.9% YoY and 59% YoY active customer growth and revenue per active customer growth respectively. However, 2020 operating loss declined just $116m. It is an indication that Coupang’s margin expansion potential is greatly exhausted.There is significant revenue growth potential in Coupang. However, we don’t expect revenue growth to translate into profits. Thus, the $50.0bn valuation suggested by various media reports seems extremely optimistic.

<p><a href="https://www.smartkarma.com/entities/coupang" target="_blank" data-smartkarma-citation="entities:28425:1" rel="noopener">Coupang (CPNG US)</a> , the largest product e-commerce player in Korea, aims to raise around US$3bn in its US listing via a mix of selling primary and secondary shares. As per media reports, the company has earlier obtained investments from Sequoia, Softbank, Blackrock and Fidelity.</p><p>Coupang offers its 14.8m customers a wide range of owned-inventory selection. In addition, on its marketplace it also offers millions of SKUs sourced from over 200,000 merchants. Apart from normal e-commerce operation, it also provides its customers with: grocery offering, Rocket Fresh; logistics food delivery offering, Coupang Eats; and digital financial services, Coupang Pay.</p><p>In this insight, we'll talk about the positive aspects of the deal.</p>

Coupang (CPNG US) , the largest product e-commerce player in Korea, aims to raise around US$3bn in its US listing via a mix of selling primary and secondary shares. As per media reports, the company has earlier obtained investments from Sequoia, Softbank, Blackrock and Fidelity.Coupang offers its 14.8m customers a wide range of owned-inventory selection. In addition, on its marketplace it also offers millions of SKUs sourced from over 200,000 merchants. Apart from normal e-commerce operation, it also provides its customers with: grocery offering, Rocket Fresh; logistics food delivery offering, Coupang Eats; and digital financial services, Coupang Pay.In this insight, we'll talk about the positive aspects of the deal.

Coupang Pre-IPO - The Positives - Fast Growth, Sticky Customers

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

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Quantitative Analysis

<div><p>The Asia Short Interest weekly looks at moves in market wide short interest and highlights movements in stock specific short interest across Hong Kong, Japan, Korea and Taiwan using the last available data published by the relevant authorities.</p></div><div><p>Hong Kong saw shorts rise on <a href="https://www.smartkarma.com/entities/wuxi-apptec" target="_blank" data-smartkarma-citation="entities:23679:1" rel="noopener">Wuxi Biologics (2269 HK)</a>, <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent Holdings (700 HK)</a>, <a href="https://www.smartkarma.com/entities/postal-savings-bank-of-china" target="_blank" data-smartkarma-citation="entities:22848:1" rel="noopener">Postal Savings Bank of China (1658 HK)</a>, <a href="https://www.smartkarma.com/entities/innovent-biologics-inc" target="_blank" data-smartkarma-citation="entities:27452:1" rel="noopener">Innovent Biologics Inc (1801 HK)</a> and <a href="https://www.smartkarma.com/entities/jinxin-fertility-group-ltd" target="_blank" data-smartkarma-citation="entities:28003:1" rel="noopener">Jinxin Fertility Co Ltd (1951 HK)</a>while there was short covering on <a href="https://www.smartkarma.com/entities/alibaba-group" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba Group (9988 HK)</a>, <a href="https://www.smartkarma.com/entities/ping-an-insurance-grp-co-of-china-ltd" target="_blank" data-smartkarma-citation="entities:12880:1" rel="noopener">Ping An Insurance (H) (2318 HK)</a>, <a href="https://www.smartkarma.com/entities/xiaomi-corp" target="_blank" data-smartkarma-citation="entities:24409:1" rel="noopener">Xiaomi Corp (1810 HK)</a>, <a href="https://www.smartkarma.com/entities/meituan-dianping" target="_blank" data-smartkarma-citation="entities:26970:1" rel="noopener">Meituan (3690 HK)</a> and <a href="https://www.smartkarma.com/entities/byd-co-ltd-h" target="_blank" data-smartkarma-citation="entities:20962:1" rel="noopener">BYD (1211 HK)</a>. Shorts increased on Financials, while decreasing on Communication Services, Health Care, Financials and Energy, while shorts decreased on Consumer Discretionary, Real Estate and Information Technology.</p></div><div><p>In Japan, stocks that saw the most shorts were <a href="https://www.smartkarma.com/entities/ryohin-keikaku-co-ltd" target="_blank" data-smartkarma-citation="entities:2765:1" rel="noopener">Ryohin Keikaku (7453 JP)</a>, <a href="https://www.smartkarma.com/entities/nomura-real-estate-master-fu" target="_blank" data-smartkarma-citation="entities:22930:1" rel="noopener">Nomura Real Estate Master Fund, (3462 JP)</a>, <a href="https://www.smartkarma.com/entities/freee-kk" target="_blank" data-smartkarma-citation="entities:28424:1" rel="noopener">freee (4478 JP)</a> and <a href="https://www.smartkarma.com/entities/orix-jreit-inc" target="_blank" data-smartkarma-citation="entities:314:1" rel="noopener">Orix JREIT Inc (8954 JP)</a> while shorts decreased on <a href="https://www.smartkarma.com/entities/itochu-corp" target="_blank" data-smartkarma-citation="entities:18448:1" rel="noopener">Itochu Corp (8001 JP)</a>, <a href="https://www.smartkarma.com/entities/trend-micro-inc" target="_blank" data-smartkarma-citation="entities:13172:1" rel="noopener">Trend Micro Inc (4704 JP)</a>, <a href="https://www.smartkarma.com/entities/dmg-mori-co-ltd" target="_blank" data-smartkarma-citation="entities:11125:1" rel="noopener">Dmg Mori Co Ltd (6141 JP)</a> and <a href="https://www.smartkarma.com/entities/pharma-foods-international" target="_blank" data-smartkarma-citation="entities:10530:1" rel="noopener">Pharma Foods International (2929 JP)</a>. Sectorally, shorts increased in Real Estate and decreased in Industrials.</p></div><div>
<p>In Korea, there was large short covering in <a href="https://www.smartkarma.com/entities/samsung-electronics-co-ltd" target="_blank" data-smartkarma-citation="entities:191:1" rel="noopener">Samsung Electronics (005930 KS)</a>, <a href="https://www.smartkarma.com/entities/pearl-abyss-corp" target="_blank" data-smartkarma-citation="entities:24391:1" rel="noopener">Pearl Abyss (263750 KS)</a>, <a href="https://www.smartkarma.com/entities/lotte-chemical-corp" target="_blank" data-smartkarma-citation="entities:8757:1" rel="noopener">Lotte Chemical (011170 KS)</a> and <a href="https://www.smartkarma.com/entities/kakao-corp" target="_blank" data-smartkarma-citation="entities:15002:1" rel="noopener">Kakao Corp (035720 KS)</a>. </p>
<p>Taiwan was closed for the week due to the Lunar New Year.</p>
</div>

The Asia Short Interest weekly looks at moves in market wide short interest and highlights movements in stock specific short interest across Hong Kong, Japan, Korea and Taiwan using the last available data published by the relevant authorities.Hong Kong saw shorts rise on Wuxi Biologics (2269 HK), Tencent Holdings (700 HK), Postal Savings Bank of China (1658 HK), Innovent Biologics Inc (1801 HK) and Jinxin Fertility Co Ltd (1951 HK)while there was short covering on Alibaba Group (9988 HK), Ping An Insurance (H) (2318 HK), Xiaomi Corp (1810 HK), Meituan (3690 HK) and BYD (1211 HK). Shorts increased on Financials, while decreasing on Communication Services, Health Care, Financials and Energy, while shorts decreased on Consumer Discretionary, Real Estate and Information Technology.In Japan, stocks that saw the most shorts were Ryohin Keikaku (7453 JP), Nomura Real Estate Master Fund, (3462 JP), freee (4478 JP) and Orix JREIT Inc (8954 JP) while shorts decreased on Itochu Corp (8001 JP), Trend Micro Inc (4704 JP), Dmg Mori Co Ltd (6141 JP) and Pharma Foods International (2929 JP). Sectorally, shorts increased in Real Estate and decreased in Industrials.
In Korea, there was large short covering in Samsung Electronics (005930 KS), Pearl Abyss (263750 KS), Lotte Chemical (011170 KS) and Kakao Corp (035720 KS). 
Taiwan was closed for the week due to the Lunar New Year.


Asia Short Interest: WuXi Bio, PSBC, Jinxin Fertility, BYD, Ryohin, Freee, Itochu, Pearl Abyss

China

Alibaba Group Holding Limited provides online sales services. The Company provides internet infrastructure, electronic commerce, online financial, and internet content services through its subsidiaries. Alibaba Group Holding offers its products and services worldwide.

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Alibaba (9988 HK)

Coupang Pre-IPO - The Negatives - Horrendous Data Disclosures, Including No Mention of OTT Launch

Coupang (CPNG US) , the largest product e-commerce player in Korea, aims to raise around US$3bn in its US listing via a mix of selling primary and...

Sumeet Singh

BABA HK Gunning for New Highs

Alibaba Group (9988 HK) exhibits good macro upside potential from our January buy call but does face some rally stall resistance. We continue to...

Thomas Schroeder

Coupang IPO: Lacks Margin Upside

Coupang is not the typical e-commerce company that enjoys margin expansion with volume and revenue growth. The company’s revenue increased 91% YoY...

Oshadhi Kumarasiri

Coupang Pre-IPO - The Positives - Fast Growth, Sticky Customers

Coupang (CPNG US) , the largest product e-commerce player in Korea, aims to raise around US$3bn in its US listing via a mix of selling primary and...

Sumeet Singh

Asia Short Interest: WuXi Bio, PSBC, Jinxin Fertility, BYD, Ryohin, Freee, Itochu, Pearl Abyss

The Insight looks at large short interest movements across HK, Japan, Korea and Taiwan stocks and highlights large increases/decreases in shorts to...

Brian Freitas

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