Equity Analyst - Asia Consumer Sector, Investory

Devi Subhakesan

Equity Analyst - Asia Consumer Sector

ASIA CONSUMER: INSIGHTS AND INVESTMENT IDEAS

Investory

Investory is a Singapore-based boutique independent equity research firm founded in January 2017 with a primary focus on consumption themes across Asia-Pacific.

We aim to generate investible ideas based on consumption trends and outlook. We screen our ideas on several parameters - product potential, long-term growth and management commitment being the most critical.  We follow a fundamental analysis approach in our stock selection process and are not restricted by market cap.

We aspire to grow into a leading source of unbiased research, free of conflict of interest, for investors yearning for independent and disciplined analysis. 

We also undertake bespoke research mandates to support our Institutional clients’ investment needs.

Our team comprises of professionals with extensive experience in the Asian equity markets, in areas ranging from research, servicing institutional clients and investment management.

Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/chagee-holdings-limited" target="_blank" data-smartkarma-citation="entities:45011:1" rel="noopener">Chagee Holdings (CHA US)</a> is offering 14.68 million shares for USD26 to USD28 each to raise upto USD411 million in its initial public offering in the US.</li>
<li>Chagee's premium branded teahouses blend traditional tea culture with modern, tech-driven service, distinctly setting itself apart from bubble tea kiosks. </li>
<li>Chagee's IPO is priced at a discount to forward valuations of recently listed (in HK) China-based freshly brewed drinks players and leading Cafe companies.</li>
</ul>



Chagee Holdings (CHA US) is offering 14.68 million shares for USD26 to USD28 each to raise upto USD411 million in its initial public offering in the US.
Chagee's premium branded teahouses blend traditional tea culture with modern, tech-driven service, distinctly setting itself apart from bubble tea kiosks. 
Chagee's IPO is priced at a discount to forward valuations of recently listed (in HK) China-based freshly brewed drinks players and leading Cafe companies.


Chagee IPO: Luckin X Starbucks of Tea. Pricing, Valuation, Key Facts & Financials

APAC IPOs & Placements, Aequitas Research

Nicholas Tan

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/chagee-holdings-limited" target="_blank" data-smartkarma-citation="entities:45011:1" rel="noopener">Chagee Holdings (CHA US)</a>  is looking to raise up to US$411m in its upcoming US IPO.</li>
<li>It is a leading premium tea drinks brand, serving healthy and delicious freshly-made tea drinks.</li>
<li>We have looked at the company’s past performance and provided our initial thoughts on valuations. In this note, we talk about the IPO pricing.</li>
</ul>



Chagee Holdings (CHA US)  is looking to raise up to US$411m in its upcoming US IPO.
It is a leading premium tea drinks brand, serving healthy and delicious freshly-made tea drinks.
We have looked at the company’s past performance and provided our initial thoughts on valuations. In this note, we talk about the IPO pricing.


Chagee IPO: Trading at a Discount to Peers but with Geopolitical Overhang

US IPOs and Secondary Offerings, IPO Boutique

IPO Boutique

US IPOs and Secondary Offerings

For more than 20 years, we have been providing research, analysis, commentary and ratings on US Equity Capital Markets to institutional investors (US IPOs and Secondary Offerings). Our vast network of contacts across the Equity Capital Markets and attention-to-detail sets us apart from our competitors.

Since 2012, we have achieved a successful hit rating on 89% of Buy-rated IPOs. The collective “Buy” ratings averaged a first trade of 16.3% above issue.Our Neutral Rated Deals averaged just 2% above the issue price at first trade.

Our written research includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

In addition, we provide a high-touch premium desk access which includes analyst access, as well as real time insights on US IPOs as well as secondary offerings.

IPOs and Secondary Offerings

<ul>
<li>Chinese Tea Company is moving ahead with the IPO despite heavy Macro-Economic winds.</li>
<li>The company is seeking up to $412m with a high-end pricing and already includes $205m worth of buying on the cover of the prospectus.</li>
<li>There are. more questions than answers regarding this IPO due to the current uncertainty in the market. </li>
</ul>


Chinese Tea Company is moving ahead with the IPO despite heavy Macro-Economic winds.
The company is seeking up to $412m with a high-end pricing and already includes $205m worth of buying on the cover of the prospectus.
There are. more questions than answers regarding this IPO due to the current uncertainty in the market. 


Chagee Holdings Limited (CHA): Chinese Tea Company Moves Forward with IPO Despite Macro Risks

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

<ul>
<li>Our base case valuation of Chagee Holdings is target price of $46.7 per share, representing 67% higher than the high end of the IPO price range ($28 per share). </li>
<li>Our base case valuation is based on a P/E of 21.4x on our estimated net profit of 2.9 billion RMB in 2025. </li>
<li>We used a very conservative valuation multiple, mainly due to the extremely high macro risks related to the ongoing tariff dispute between China and the United States.</li>
</ul>


Our base case valuation of Chagee Holdings is target price of $46.7 per share, representing 67% higher than the high end of the IPO price range ($28 per share). 
Our base case valuation is based on a P/E of 21.4x on our estimated net profit of 2.9 billion RMB in 2025. 
We used a very conservative valuation multiple, mainly due to the extremely high macro risks related to the ongoing tariff dispute between China and the United States.


HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

<ul>
<li>The main reason behind declining performance is related to the increase in regional market density brought about by newly opened teahouses. Franchisees would be more cautious about investing in Chagee.</li>
<li>With the passage of time and the declining same store GMV, the low teahouse closure rate will gone. Product strategy of "flagship product + classic basics " also has risks.</li>
<li>Based on our forecast of 2025 net profit of about RMB3 billion (or US$400 million) and US IPO market value of US$5 billion, P/E is about 12.5x. </li>
</ul>


The main reason behind declining performance is related to the increase in regional market density brought about by newly opened teahouses. Franchisees would be more cautious about investing in Chagee.
With the passage of time and the declining same store GMV, the low teahouse closure rate will gone. Product strategy of "flagship product + classic basics " also has risks.
Based on our forecast of 2025 net profit of about RMB3 billion (or US$400 million) and US IPO market value of US$5 billion, P/E is about 12.5x. 


Pre-IPO Chagee Holdings - Some Points Worth the Attention

United States

Chagee Holdings Limited operates as a holding company. The Company, through its subsidiaries, provides a wide range of freshly-made tea drinks. Chagee Holdings serves customers worldwide.

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Chagee Holdings (CHA US)

Chagee IPO: Luckin X Starbucks of Tea. Pricing, Valuation, Key Facts & Financials

Chagee - the premium teahouse chain - has priced its US IPO at US$26 to US$26, at a valuation discount to freshly made beverage players listed in...

Devi Subhakesan

Chagee IPO: Trading at a Discount to Peers but with Geopolitical Overhang

Chagee is looking to raise up to US$411m in its upcoming US IPO. In this note, we talk about the IPO pricing and how it's valued relative to peers.

Nicholas Tan

Chagee Holdings Limited (CHA): Chinese Tea Company Moves Forward with IPO Despite Macro Risks

Chinese Tea Company pushes forward with IPO despite economic challenges, seeking $412m with high-end pricing and $205m in buying already on the...

IPO Boutique

Chagee Holdings IPO Valuation Analysis

Our base case valuation of Chagee Holdings is target price of $46.7 per share, representing 67% higher than the high end of the IPO price range...

Douglas Kim

Pre-IPO Chagee Holdings - Some Points Worth the Attention

With declining performance, franchisees are cautious about investing in Chagee. Due to sharp decline in US stocks, Chagee's IPO may not perform...

Xinyao (Criss) Wang

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Chagee IPO: Luckin X Starbucks of Tea. Pricing, Valuation, Key Facts & Financials

Chagee - the premium teahouse chain - has priced its US IPO at US$26 to US$26, at a valuation discount to freshly made beverage players listed in...

Devi Subhakesan

Chagee IPO: Trading at a Discount to Peers but with Geopolitical Overhang

Chagee is looking to raise up to US$411m in its upcoming US IPO. In this note, we talk about the IPO pricing and how it's valued relative to peers.

Nicholas Tan

Chagee Holdings Limited (CHA): Chinese Tea Company Moves Forward with IPO Despite Macro Risks

​Chinese Tea Company pushes forward with IPO despite economic challenges, seeking $412m with high-end pricing and $205m in buying already on the...

IPO Boutique

Chagee Holdings IPO Valuation Analysis

Our base case valuation of Chagee Holdings is target price of $46.7 per share, representing 67% higher than the high end of the IPO price range...

Douglas Kim

Pre-IPO Chagee Holdings - Some Points Worth the Attention

With declining performance, franchisees are cautious about investing in Chagee. Due to sharp decline in US stocks, Chagee's IPO may not perform...

Xinyao (Criss) Wang

Chinese Tea Company pushes forward with IPO despite economic challenges, seeking $412m with high-end pricing and $205m in buying already on the...