Latest News from the World’s Leading Innovators

Granite Bay Capital

An innovation focussed investment company

Granite Bay Capital is an innovation focussed investment company with a deep focus on the companies at the leading edge of innovation across major themes such as AI, ubiquitous computing, sustainability, automation and longevity.

Thematic (Sector/Industry)

Headline Developments On the back of the Epic v Apple case, documents were released highlighting that Google (GOOG) had considered buying Epic outright.  During the case, Epic Games outlined Google’s plans to develop “a series of internal projects to address the ‘contagion’ it perceived from efforts by Epic and others to offer consumers and developers competitive alternatives and has even contemplated buying some or all of Epic to squelch this threat”.

Headline Developments On the back of the Epic v Apple case, documents were released highlighting that Google (GOOG) had considered buying Epic outright.  During the case, Epic Games outlined Google’s plans to develop “a series of internal projects to address the ‘contagion’ it perceived from efforts by Epic and others to offer consumers and developers competitive alternatives and has even contemplated buying some or all of Epic to squelch this threat”.

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Capital Markets

Robinhood Markets  / Equity Capital Markets

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Our base case valuation of Robinhood is implied market cap of US$25.1 billion or US$29.8 per share, which is 25% lower than the mid-point of the IPO price range (US$40). Given the downside risk, we would AVOID this IPO. 
<ul><li>Our valuation of Robinhood is based on an EV/S multiple of 10.7x using our estimated sales of US$2.1 billion in 2022. <ul>
<li>The EV/S multiple of 10.7x is based on the average multiple of the comps in 2022.</li>
<li>The valuation multiple is higher than the those of online brokers Charles Schwab and Interactive Brokers Group.</li>
<li>However, it is lower than the valuation multiples of the fintech comps including Coinbase and Affirm.</li>
</ul>
</li></ul>
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Our base case valuation of Robinhood is implied market cap of US$25.1 billion or US$29.8 per share, which is 25% lower than the mid-point of the IPO price range (US$40). Given the downside risk, we would AVOID this IPO. 
Our valuation of Robinhood is based on an EV/S multiple of 10.7x using our estimated sales of US$2.1 billion in 2022. 
The EV/S multiple of 10.7x is based on the average multiple of the comps in 2022.
The valuation multiple is higher than the those of online brokers Charles Schwab and Interactive Brokers Group.
However, it is lower than the valuation multiples of the fintech comps including Coinbase and Affirm.




Headline Developments: We can now modify DNA inside of a human body (in vivo), thanks to some groundbreaking work announced this week by Intellia Therapeutics (NTLA) which saw the company’s share price surge 55%.  What this means is that we can now send precision therapeutics (based on CRISPR technology) to “seek and destroy” problematic genes.

Headline Developments: We can now modify DNA inside of a human body (in vivo), thanks to some groundbreaking work announced this week by Intellia Therapeutics (NTLA) which saw the company’s share price surge 55%.  What this means is that we can now send precision therapeutics (based on CRISPR technology) to “seek and destroy” problematic genes.

China and US Equity Analyst

Roger Xie

<ul>
<li>Hong Kong de facto central bank, HKMA (Hong Kong Monetary Authority), issued a strategic paper exploring the feasibility of issuing a retail-focused CBDC (central bank digital currency), an e-HKD, within 12 months. One of the major use cases of e-HKD is to link with e-CNY and facilitate cross-border payment or transfer. This has underscored China's ambition to take further step rolling out its most advanced digital currency among major economies.</li>
<li>Based on the latest quarterly statistics on mobile app usage, digital currency app has become a dominant factor in user engagement. Stock trading and crypto trading apps show much higher daily user visits and viewing time, compared with other financial management apps. The proliferation of CBDC (central bank digital currency), such as e-HKD and e-CNY, will likely accelerate user growth and engagement. The major crypto exchange <a href="https://www.smartkarma.com/entities/coinbase-global-inc" target="_blank" data-smartkarma-citation="entities:32227:1" rel="noopener">Coinbase (COIN US)</a> has shown its registered users jumping 65% year-over-year in 21Q1 during the wider acceptancy of bitcoin. </li>
<li>We expect the majority of Hong Kong-based retail banks will likely roll out their own mobile apps with capability to transact on e-HKD and e-CNY in near term. The successful integration of this feature might likely impact user engagement, which might become a key KPI for banks' mobile app in our view. MAU/DAU (Month/Daily Active User) might become the differentiators for Hong Kong based retail banks such as  <a href="https://www.smartkarma.com/entities/hsbc-holdings-plc" target="_blank" data-smartkarma-citation="entities:516:1" rel="noopener">HSBC Holdings (5 HK)</a> , <a href="https://www.smartkarma.com/entities/hang-seng-bank-ltd" target="_blank" data-smartkarma-citation="entities:24:1" rel="noopener">Hang Seng Bank (11 HK)</a> , <a href="https://www.smartkarma.com/entities/bank-of-east-asia-ltd" target="_blank" data-smartkarma-citation="entities:341:1" rel="noopener">Bank of East Asia (23 HK)</a> , <a href="https://www.smartkarma.com/entities/boc-hong-kong-holdings-ltd" target="_blank" data-smartkarma-citation="entities:343:1" rel="noopener">BOC Hong Kong (BOC HK) (2388 HK)</a> , <a href="https://www.smartkarma.com/entities/dah-sing-financial-holdings" target="_blank" data-smartkarma-citation="entities:589:1" rel="noopener">Dah Sing Financial (440 HK). </a>
</li>
</ul>


Hong Kong de facto central bank, HKMA (Hong Kong Monetary Authority), issued a strategic paper exploring the feasibility of issuing a retail-focused CBDC (central bank digital currency), an e-HKD, within 12 months. One of the major use cases of e-HKD is to link with e-CNY and facilitate cross-border payment or transfer. This has underscored China's ambition to take further step rolling out its most advanced digital currency among major economies.
Based on the latest quarterly statistics on mobile app usage, digital currency app has become a dominant factor in user engagement. Stock trading and crypto trading apps show much higher daily user visits and viewing time, compared with other financial management apps. The proliferation of CBDC (central bank digital currency), such as e-HKD and e-CNY, will likely accelerate user growth and engagement. The major crypto exchange Coinbase (COIN US) has shown its registered users jumping 65% year-over-year in 21Q1 during the wider acceptancy of bitcoin. 
We expect the majority of Hong Kong-based retail banks will likely roll out their own mobile apps with capability to transact on e-HKD and e-CNY in near term. The successful integration of this feature might likely impact user engagement, which might become a key KPI for banks' mobile app in our view. MAU/DAU (Month/Daily Active User) might become the differentiators for Hong Kong based retail banks such as  HSBC Holdings (5 HK) , Hang Seng Bank (11 HK) , Bank of East Asia (23 HK) , BOC Hong Kong (BOC HK) (2388 HK) , Dah Sing Financial (440 HK). 



Hong Kong to Embrace Digital Currency E-HKD, Boosting Fintech Investment and Connectivity With E-CNY

Alpha-Centric ESG Research

Kyle Rudden

More and more, companies are using cryptocurrency (especially Bitcoin) as part of their corporate treasury management strategies, discussed in <a href="https://www.smartkarma.com/insights/bitcoin-on-balance-sheets-indirect-crypto-exposure-considerations-for-crypto-leery-esg-investors" target="_blank" data-smartkarma-citation="insights:52207" rel="noopener">Bitcoin on Balance Sheets: Indirect Crypto Exposure Considerations for Crypto-Leery ESG Investors</a>. That trend is behind the topic of this report.Greater mainstream corporate and institutional use of Bitcoin is driving the growth in demand for cryptocurrency custody services, and banks around the world are rushing to fill that demand. It is a logical and relatively safe foray into the cryptocurrency space, albeit not without some risk.For ESG investors wishing to avoid direct or indirect cryptocurrency exposure, perhaps due to their views on crypto's wretched Environmental footprint, the banks herein will have significant indirect crypto exposure. However, I personally find it hard to be categorically bearish on this theme.Whilst the theme in the first Insight (holding Bitcoin on balance sheets) represents real risk, this is different. It could be argued that crypto custody perpetuates <a href="https://www.smartkarma.com/entities/bitcoin-usd" target="_blank" data-smartkarma-citation="entities:25895:1" rel="noopener">Bitcoin (XBT)</a>'s climate impacts, thus is a bad thing. Perhaps, from a purely idealistic ESG viewpoint, that is partially true.However, the connection from custody service to carbon emissions is so far removed, and the risks associated with entering the crypto custody space are so comparatively minimal, that the opinion on this theme should be "neutral" at worst, and definitely not across-the-board "negative."But really, that is for each investor to decide, because the crypto/ESG issue is highly subjective.

More and more, companies are using cryptocurrency (especially Bitcoin) as part of their corporate treasury management strategies, discussed in Bitcoin on Balance Sheets: Indirect Crypto Exposure Considerations for Crypto-Leery ESG Investors. That trend is behind the topic of this report.Greater mainstream corporate and institutional use of Bitcoin is driving the growth in demand for cryptocurrency custody services, and banks around the world are rushing to fill that demand. It is a logical and relatively safe foray into the cryptocurrency space, albeit not without some risk.For ESG investors wishing to avoid direct or indirect cryptocurrency exposure, perhaps due to their views on crypto's wretched Environmental footprint, the banks herein will have significant indirect crypto exposure. However, I personally find it hard to be categorically bearish on this theme.Whilst the theme in the first Insight (holding Bitcoin on balance sheets) represents real risk, this is different. It could be argued that crypto custody perpetuates Bitcoin (XBT)'s climate impacts, thus is a bad thing. Perhaps, from a purely idealistic ESG viewpoint, that is partially true.However, the connection from custody service to carbon emissions is so far removed, and the risks associated with entering the crypto custody space are so comparatively minimal, that the opinion on this theme should be "neutral" at worst, and definitely not across-the-board "negative."But really, that is for each investor to decide, because the crypto/ESG issue is highly subjective.

Banks on the Bitcoin Bandwagon: Cashing in Through Crypto Custody Services

United States

Coinbase Global, Inc. provides financial solutions. The Company offers platform to buy and sell cryptocurrencies. Coinbase Global serves clients worldwide.

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Coinbase Global (COIN US)

Weekly Innovation Review (WIRE) #44

Headline Developments On the back of the Epic v Apple case, documents were released highlighting that Google (GOOG) had considered buying Epic...

Granite Bay Capital

Robinhood IPO Valuation Analysis

Our base case valuation of Robinhood is implied market cap of US$25.1 billion or US$29.8 per share, which is 25% lower than the mid-point of the...

Douglas Kim

Weekly Innovation Review (WIRE) #38

Headline Developments: We can now modify DNA inside of a human body (in vivo), thanks to some groundbreaking work announced this week

Granite Bay Capital

Hong Kong to Embrace Digital Currency E-HKD, Boosting Fintech Investment and Connectivity With E-CNY

Hong Kong Monetary Authority issued a strategic paper exploring the feasibility of issuing e-HKD within 12 months. Banking app MAU/DAU might become...

Roger Xie

Banks on the Bitcoin Bandwagon: Cashing in Through Crypto Custody Services

Bitcoin holdings by issuers and investors is driving crypto custody demand. Big banks are stepping. A big opportunity, but some ESG investors might...

Kyle Rudden

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