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

<ul>
<li>
<a href="https://www.smartkarma.com/entities/go-inc" target="_blank" data-smartkarma-citation="entities:49420:1" rel="noopener">GO (581A JP)</a> a leading taxi app in Japan, raised around US$550m via a secondary selldown in its Japan IPO.</li>
<li>GO combines app-based taxi hailing with in-taxi technology to meet the needs of both users and partner taxi operators through services such as ride matching, payment processing and advertising.</li>
<li>We have looked at the company’s past performance and valuations in our previous note. In this note, we will talk about the trading dynamics.</li>
</ul>



GO (581A JP) a leading taxi app in Japan, raised around US$550m via a secondary selldown in its Japan IPO.
GO combines app-based taxi hailing with in-taxi technology to meet the needs of both users and partner taxi operators through services such as ride matching, payment processing and advertising.
We have looked at the company’s past performance and valuations in our previous note. In this note, we will talk about the trading dynamics.


Aequitas: GO Inc IPO Trading - Strong Demand but Its Not Cheap

'Quantamental' Japan Specialist, LightStream Research

Campbell Gunn

'Quantamental' Japan Specialist

ja research

ja research is an independent research platform focused exclusively on Japanese equities. Leveraging data and graphic analysis provided by Japan Analytics, we provide insights on small and medium-sized companies that have been ignored by the sell-side as well as challenging conventional wisdom on larger companies. We also offer analyst and corporate access, the latter with translation if required. 

Thematic (Sector/Industry)

<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/116/531/original/2020-02-06_03-39-10.png?1580933731" class="editor-image img-responsive" data-smartkarma-image-id="116531"></figure><div class="content-caption">Source • Japan Analytics</div><p><strong>5TH FEBRUARY ROUNDUP</strong> - Wednesday saw 171 Results and 65 Forecast/Revision announcements. The Results Score set another new three-year low losing 16bps to reach 0.35, while the Forecast/Revision Score shed 7bps to reach 0.08. The sogo shosha trading company results were weak, with the exception of <a href="https://www.smartkarma.com/entities/itochu-corp" target="_blank" data-smartkarma-citation="entities:18448:1" rel="noopener">Itochu (8001 JP)</a>. Amongst large caps, <a href="https://www.smartkarma.com/entities/marubeni-corp" target="_blank" data-smartkarma-citation="entities:7463:1" rel="noopener">Marubeni (8002 JP)</a> and <a href="https://www.smartkarma.com/entities/dena-co-ltd" target="_blank" data-smartkarma-citation="entities:747:1" rel="noopener">DeNA(2432 JP)</a> had Operating Losses, while <a href="https://www.smartkarma.com/entities/mazda-motor-corp" target="_blank" data-smartkarma-citation="entities:20528:1" rel="noopener">Mazda Motor (7261 JP)</a>, <a href="https://www.smartkarma.com/entities/fujikura-ltd" target="_blank" data-smartkarma-citation="entities:10768:1" rel="noopener">Fujikura (5803 JP)</a>, <a href="https://www.smartkarma.com/entities/daicel-corp" target="_blank" data-smartkarma-citation="entities:10533:1" rel="noopener">Daicel (4202 JP)</a>, and <a href="https://www.smartkarma.com/entities/furukawa-electric-co-ltd" target="_blank" data-smartkarma-citation="entities:5193:1" rel="noopener">Furukawa Electric (5801 JP)</a> saw steep quarterly year-on-year OP declines. Amongst the 'winners' were <a href="https://www.smartkarma.com/entities/square-enix-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:15003:1" rel="noopener">Square Enix (9684 JP)</a>, and <a href="https://www.smartkarma.com/entities/rengo-co-ltd" target="_blank" data-smartkarma-citation="entities:20278:1" rel="noopener">Rengo (3941 JP)</a>.</p><hr><p style="text-align: center;"><strong>• SECTOR TIMELINE •</strong></p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/116/532/original/2020-02-06_03-42-28.png?1580934310" class="editor-image img-responsive" data-smartkarma-image-id="116532"></figure><div class="content-caption">Source • Japan Analytics</div><p><strong>SECTOR TIMELINE</strong> - The <strong>Wholesale</strong> Sector was the largest loser yesterday with <a href="https://www.smartkarma.com/entities/mitsubishi-corp" target="_blank" data-smartkarma-citation="entities:20668:1" rel="noopener">Mitsubishi (8058 JP)</a> and <a href="https://www.smartkarma.com/entities/kanematsu-corp" target="_blank" data-smartkarma-citation="entities:5810:1" rel="noopener">Kanematsu (8020 JP)</a> joining Marubeni in posting poor results. <a href="https://www.smartkarma.com/entities/taiyo-nippon-sanso-corp" target="_blank" data-smartkarma-citation="entities:15756:1" rel="noopener">Taiyo Nippon Sanso (4091 JP)</a> slowing momentum and downward revision saw the <strong>Chemical</strong> Sector move lower again. <a href="https://www.smartkarma.com/entities/agc-inc" target="_blank" data-smartkarma-citation="entities:2167:1" rel="noopener">AGC (5201 JP)</a> initial forecast for FY2020 helped the <strong>Other Materials</strong> Sector recover some ground. </p>

Source • Japan Analytics5TH FEBRUARY ROUNDUP - Wednesday saw 171 Results and 65 Forecast/Revision announcements. The Results Score set another new three-year low losing 16bps to reach 0.35, while the Forecast/Revision Score shed 7bps to reach 0.08. The sogo shosha trading company results were weak, with the exception of Itochu (8001 JP). Amongst large caps, Marubeni (8002 JP) and DeNA(2432 JP) had Operating Losses, while Mazda Motor (7261 JP), Fujikura (5803 JP), Daicel (4202 JP), and Furukawa Electric (5801 JP) saw steep quarterly year-on-year OP declines. Amongst the 'winners' were Square Enix (9684 JP), and Rengo (3941 JP).• SECTOR TIMELINE •Source • Japan AnalyticsSECTOR TIMELINE - The Wholesale Sector was the largest loser yesterday with Mitsubishi (8058 JP) and Kanematsu (8020 JP) joining Marubeni in posting poor results. Taiyo Nippon Sanso (4091 JP) slowing momentum and downward revision saw the Chemical Sector move lower again. AGC (5201 JP) initial forecast for FY2020 helped the Other Materials Sector recover some ground. 

🇯🇵 JAPAN • Results & Revisions Daily Roundup - 5th February ▲5201 4202 6269 ▼4091 9987 6869

<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/106/452/original/2019-11-17_11-54-09.png?1573959284" class="editor-image img-responsive" data-smartkarma-image-id="106452"></figure><div class="content-caption">Source: Japan Analytics</div><p><strong>4TH DOWN AND A FEW MORE TO GO</strong> - The latest quarterly results are now, with the exception of three large insurance companies are currently in the market and, to loosely paraphrase the under-rated Jesse Winchester's second album title, this is the fourth straight 'down' quarter with the prospect a few more to come. Operating Income has declined by 7.8% and Net Income by 18.8%, taking margins to 6.9% and 4.6%, respectively - declines of 84bps and 122bps. The market has celebrated these new two-year lows by rising to new two-year highs, leaving some to wonder what they are missing, other than yet more central bank liquidity. The trailing-twelve-month (TTM) price-earnings ratio is now 17 times, the highest since 5th February 2018, ten trading days after the long-term market peak.</p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/106/458/original/2019-11-17_12-49-55.png?1573962614" class="editor-image img-responsive" data-smartkarma-image-id="106458"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/106/459/original/2019-11-17_13-10-47.png?1573963867" class="editor-image img-responsive" data-smartkarma-image-id="106459"></figure><div class="content-caption">Source: Japan Analytics</div><p><strong>THE EARNINGS CYCLE HAS YET TO BOTTOM</strong> -  Our Results &amp; Forecast/Revision Score data series cover the last sixteen years of quarterly earnings and eleven years of forecasts and revisions and measure both results and forecasts but also their momentum, providing a better correlation with the market direction than past earnings.   The Forecast/Revision Score leads the Results Score by several months, and the market leads or lags depending on monetary and liquidity conditions. Although both Scores recovered in the last five days of results announcements, the Forecast/Revision Score of 0.45 reached on 8th November is the lowest such score in ten years and is suggesting that earnings have yet to bottom.</p><div class="content-highlight"><p><strong>WISHFUL THINKING? - The 'gap' between market expectations and actual and forecast earnings momentum is now wider than at any time since late 2014, shortly before the market peak of May 2015. Is this foresight or just wishful thinking? We tend to the latter interpretation.</strong></p></div><p><strong>In the DETAIL section below, we shall provide a full breakdown of the results and revisions announcements by Sector, Peer Group and company and offer brief comments on several recommended buys and sells.</strong></p>

Source: Japan Analytics4TH DOWN AND A FEW MORE TO GO - The latest quarterly results are now, with the exception of three large insurance companies are currently in the market and, to loosely paraphrase the under-rated Jesse Winchester's second album title, this is the fourth straight 'down' quarter with the prospect a few more to come. Operating Income has declined by 7.8% and Net Income by 18.8%, taking margins to 6.9% and 4.6%, respectively - declines of 84bps and 122bps. The market has celebrated these new two-year lows by rising to new two-year highs, leaving some to wonder what they are missing, other than yet more central bank liquidity. The trailing-twelve-month (TTM) price-earnings ratio is now 17 times, the highest since 5th February 2018, ten trading days after the long-term market peak.Source: Japan AnalyticsTHE EARNINGS CYCLE HAS YET TO BOTTOM -  Our Results &amp; Forecast/Revision Score data series cover the last sixteen years of quarterly earnings and eleven years of forecasts and revisions and measure both results and forecasts but also their momentum, providing a better correlation with the market direction than past earnings.   The Forecast/Revision Score leads the Results Score by several months, and the market leads or lags depending on monetary and liquidity conditions. Although both Scores recovered in the last five days of results announcements, the Forecast/Revision Score of 0.45 reached on 8th November is the lowest such score in ten years and is suggesting that earnings have yet to bottom.WISHFUL THINKING? - The 'gap' between market expectations and actual and forecast earnings momentum is now wider than at any time since late 2014, shortly before the market peak of May 2015. Is this foresight or just wishful thinking? We tend to the latter interpretation.In the DETAIL section below, we shall provide a full breakdown of the results and revisions announcements by Sector, Peer Group and company and offer brief comments on several recommended buys and sells.

🇯🇵 Japan • Results & Revisions Review - Wishful Thinking

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>
<strong><a href="https://www.smartkarma.com/entities/yamada-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:641:1" rel="noopener">Yamada (9831 JP)</a></strong> and <strong><a href="https://www.smartkarma.com/entities/edion-corp" target="_blank" data-smartkarma-citation="entities:14358:1" rel="noopener">Edion Corp (2730 JP)</a></strong>'s MOU to negotiate to form a Holdco,  also means that capital actions to improve shareholder returns are probably dead for a year.</li>
<li>IFM critiques the IE's fair value assessment of <strong><a href="https://www.smartkarma.com/entities/atlas-arteria-ltd" target="_blank" data-smartkarma-citation="entities:14430:1" rel="noopener">Atlas Arteria (ALX AU)</a></strong> and extends the offer period; amid minimal tendering. </li>
<li>
<strong><a href="https://www.smartkarma.com/entities/kawasaki-kisen-kaisha-ltd" target="_blank" data-smartkarma-citation="entities:3548:1" rel="noopener">Kawasaki Kisen Kaisha (9107 JP)</a>/KLINE</strong> upped their buyback plan from ¥50bn to ¥130bn and started with a big ToSTNeT-3.  Buy on weakness. Longer-term, be long and stay long.</li>
</ul>



Yamada (9831 JP) and Edion Corp (2730 JP)'s MOU to negotiate to form a Holdco,  also means that capital actions to improve shareholder returns are probably dead for a year.
IFM critiques the IE's fair value assessment of Atlas Arteria (ALX AU) and extends the offer period; amid minimal tendering. 

Kawasaki Kisen Kaisha (9107 JP)/KLINE upped their buyback plan from ¥50bn to ¥130bn and started with a big ToSTNeT-3.  Buy on weakness. Longer-term, be long and stay long.


Last Week In Event SPACE: Yamada/Edion, Atlas Arteria, Kawasaki Kisen Kaisha/KLINE, MGM China

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/go-inc" target="_blank" data-smartkarma-citation="entities:49420:1" rel="noopener">GO (581A JP)</a> is Japan’s leading ride-hailing platform. It is seeking to raise up to JPY86.7 billion (US$546 million). Pricing is on 1 June, with listing on 16 June.</li>
<li>I previously discussed the IPO in <strong><em><a href="https://www.smartkarma.com/insights/go-581a-jp-ipo-the-investment-case" target="_blank" data-smartkarma-citation="insights:238988" rel="noopener">GO (581A JP) IPO: The Investment Case</a></em></strong>. </li>
<li>In this note, I present my forecasts and discuss valuation. My analysis suggests that GO is attractively valued at the IPO price relative to its peers' multiples.</li>
</ul>



GO (581A JP) is Japan’s leading ride-hailing platform. It is seeking to raise up to JPY86.7 billion (US$546 million). Pricing is on 1 June, with listing on 16 June.
I previously discussed the IPO in GO (581A JP) IPO: The Investment Case. 
In this note, I present my forecasts and discuss valuation. My analysis suggests that GO is attractively valued at the IPO price relative to its peers' multiples.


Japan

DeNA Co., Ltd. operates social media site, auction and shopping web site such as Mobage-town and Bidders.  DeNA also provides mobile-related services such as mobile game and community site.

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DeNA (2432 JP)

Aequitas: GO Inc IPO Trading - Strong Demand but Its Not Cheap

GO (581A JP) a leading taxi app in Japan, raised around US$550m via a secondary selldown in its Japan IPO. In this note, we talk about the deal...

Sumeet Singh

🇯🇵 JAPAN • Results & Revisions Daily Roundup - 5th February ▲5201 4202 6269 ▼4091 9987 6869

5TH FEBRUARY ROUNDUP - Wednesday saw 171 Results and 65 Forecast/Revision announcements. The Results Score set another new three-year low losing...

Campbell Gunn

🇯🇵 Japan • Results & Revisions Review - Wishful Thinking

4TH DOWN AND A FEW MORE TO GO - The latest quarterly results are now, with the exception of three large insurance companies are currently in the...

Campbell Gunn

Last Week In Event SPACE: Yamada/Edion, Atlas Arteria, Kawasaki Kisen Kaisha/KLINE, MGM China

It’s Sunday! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed during the...

David Blennerhassett

GO (581A JP) IPO: Valuation Insights

The IPO price range has been set at JPY2,350-2,400 compared to the reference price of JPY2,350. The domestic/international mix has changed from 34%...

Arun George

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