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.

Equity Capital Markets

Renesas Electronics / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/mitsubishi-electric-corp" target="_blank" data-smartkarma-citation="entities:11171:1" rel="noopener">Mitsubishi Electric (6503 JP)</a> is looking to raise approximately US$800m through an accelerated secondary block deal, via selling 50.71m shares (2.6% of TSO) of <a href="https://www.smartkarma.com/entities/renesas-electronics-corp" target="_blank" data-smartkarma-citation="entities:15933:1" rel="noopener">Renesas Electronics (6723 JP)</a> stock. </li>
<li>The deal will be an easy one to digest at only three days of three month ADV.</li>
<li>In this note, we will talk about the placement and run the deal through our ECM framework.</li>
</ul>



Mitsubishi Electric (6503 JP) is looking to raise approximately US$800m through an accelerated secondary block deal, via selling 50.71m shares (2.6% of TSO) of Renesas Electronics (6723 JP) stock. 
The deal will be an easy one to digest at only three days of three month ADV.
In this note, we will talk about the placement and run the deal through our ECM framework.


Renesas Electronics Block - Smaller than Recent Deals but Still Likely Well Flagged

Consumer Analyst / Channel Surveillance Specialist, Trudence Capital Advisors

Pranav Bhavsar

Consumer Analyst / Channel Surveillance Specialist

Trudence Capital Advisors

Trudence Capital Advisors Private Limited is a SEBI-registered Research Analyst, holding SEBI registration number INH000015747. Our firm is dedicated to providing independent and unbiased research on Indian mid to large-cap companies. Trudence Capital is known for its counter-consensus views, with a focus on forensic research and on-ground primary investigations. Our research approach is thorough, involving detailed analysis of accounting practices and governance, alongside extensive channel checks.

Independent & Unbiased Research

Equity Bottom-Up

Johnson Controls-Hitachi Air Conditioning India / Equity Bottom-Up

Johnson Controls-Hitachi Air Conditioning India

<ul>
<li>Our channel interactions continue to suggest, <a href="https://www.smartkarma.com/entities/johnson-controls-hitachi-air-conditioning-india-ltd" target="_blank" data-smartkarma-citation="entities:6172:1" rel="noopener">Johnson Controls-Hitachi Air Conditioning India (JCHAC IN)</a> will not be able to recover market share over the next two years. </li>
<li>More disappointment in line with what we have seen in Q2 remains a strong probability. </li>
<li>Other annual report concerns also warrant attention, best to AVOID in spite of a sharp correction in stock price. </li>
</ul>


Our channel interactions continue to suggest, Johnson Controls-Hitachi Air Conditioning India (JCHAC IN) will not be able to recover market share over the next two years. 
More disappointment in line with what we have seen in Q2 remains a strong probability. 
Other annual report concerns also warrant attention, best to AVOID in spite of a sharp correction in stock price. 


Johnson Hitachi (JCHAC IN) | Losing Its "Cool"

<ul>
<li>The demand environment for offline electronic retailers has been good in Q1, the macro factors also point to good growth for FY23. </li>
<li>Companies like <a href="https://www.smartkarma.com/entities/haier-smart-home-co-ltd-b3ef445f-0f54-4586-8c58-9073de98d60e" target="_blank" data-smartkarma-citation="entities:31105:1" rel="noopener">Haier Smart Home Co Ltd (6690 HK)</a> and <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> have done well. <a href="https://www.smartkarma.com/entities/voltas-ltd" target="_blank" data-smartkarma-citation="entities:19924:1" rel="noopener">Voltas Ltd (VOLT IN)</a> has not been able to recover. </li>
<li>Indian consumer no longer wants everything cheap, assuming affordability, quality and brand value is taking prominence. </li>
</ul>


The demand environment for offline electronic retailers has been good in Q1, the macro factors also point to good growth for FY23. 
Companies like Haier Smart Home Co Ltd (6690 HK) and Samsung Electronics (005930 KS) have done well. Voltas Ltd (VOLT IN) has not been able to recover. 
Indian consumer no longer wants everything cheap, assuming affordability, quality and brand value is taking prominence. 


India Channel Insight #41 | Haier, Samsung, Voltas

<ul>
<li>Our checks suggest <a href="https://www.smartkarma.com/entities/hitachi-home-life-solutions-india-ltd" target="_blank" data-smartkarma-citation="entities:6172:1" rel="noopener">Hitachi Home &amp; Life Solutions India Ltd (JCHAC IN)</a> has lost market share this season. </li>
<li>Market share loss has come on the back of poor product quality due to focus on costs and competition, which is irreparable in spite of the strong dealer network. </li>
<li>Poor capital allocation, high receivables and low-profit margins, all warrant attention. </li>
</ul>


Our checks suggest Hitachi Home &amp; Life Solutions India Ltd (JCHAC IN) has lost market share this season. 
Market share loss has come on the back of poor product quality due to focus on costs and competition, which is irreparable in spite of the strong dealer network. 
Poor capital allocation, high receivables and low-profit margins, all warrant attention. 


Johnson Controls-Hitachi (JCHAC IN) | Irreparable Loss in Market Share

External broker reports(aggregated public sources), Nirmal Bang

Nirmal Bang

External broker reports(aggregated public sources)

A Relationship Beyond Broking

Nirmal Bang, one of the leading stock broking companies in India, caters to retail and institutional clients by offering them a range of financial products and services, including equities, derivatives, commodities, currency derivatives, mutual funds, IPOs, insurance, depository services and PMS.

Nirmal Bang is drawn from a diversity of professional backgrounds, and blend of experience, skill and dedication is shared with its clients. Nirmal Bang emphasizes adequate, thorough research local and world-wide developments, balancing these with the astute discovery of intrinsic values, synergies and growth. The aim is simply to help the investors to maximize their returns.

<div><div><div><div><ul><li>Strong performance expected in 1QFY23: JCH-IN has grown by 60.4% over the 4QFY20 base.</li></ul><div><div><div><div><ul><li>Expect margins to improve going forward: EBITDA margin contracted by 770bps YoY to 5.7% in 4QFY22 mainly due to commodity cost pressures (raw material costs were up 40.7% YoY).</li></ul><div><div><div><div><ul><li>Capital employed increased: Capital employed for Cooling Products rose to Rs5.53bn in 4QFY22 from Rs4.39bn in 4QFY21.</li></ul></div></div></div></div></div></div></div></div></div></div></div></div><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

Strong performance expected in 1QFY23: JCH-IN has grown by 60.4% over the 4QFY20 base.Expect margins to improve going forward: EBITDA margin contracted by 770bps YoY to 5.7% in 4QFY22 mainly due to commodity cost pressures (raw material costs were up 40.7% YoY).Capital employed increased: Capital employed for Cooling Products rose to Rs5.53bn in 4QFY22 from Rs4.39bn in 4QFY21.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Johnson Controls-Hitachi Air Conditioning India - Margin Pressure Offsets Topline Growth

India

Johnson Controls-Hitachi Air Conditioning India Limited manufactures air conditioning products. The Company offers commercial air conditioning and refrigeration, absorption and centrifugal chillers, compressors, and environmental testing products. Johnson Controls-Hitachi Air Conditioning operates worldwide.

Johnson Controls-Hitachi Air Conditioning India (JCHAC IN)

Johnson Controls-Hitachi Air Conditioning India (JCHAC IN)

Renesas Electronics Block - Smaller than Recent Deals but Still Likely Well Flagged

Mitsubishi Electric (6503 JP) is looking to raise approximately US$800m through an accelerated secondary block deal, via selling 50.71m shares...

Ethan Aw

Johnson Hitachi (JCHAC IN) | Losing Its "Cool"

In spite of a sharp correction in price, Johnson Hitachi (JCHAC IN) is best an AVOID. Product quality issues and loss in market share imply more...

Pranav Bhavsar

India Channel Insight #41 | Haier, Samsung, Voltas

The Indian durables market is witnessing changing consumer behaviour aiding an optimistic outlook for FY23 along increasing competitive intensity...

Pranav Bhavsar

Johnson Controls-Hitachi Air Conditioning India - Margin Pressure Offsets Topline Growth

JCH-IN posted revenue of Rs6.9bn in 4QFY22, up 19.8% YoY. The topline was below our estimate by 9.5%, but above consensus estimate by 7.4%.

Nirmal Bang

Renesas Electronics Block - Smaller than Recent Deals but Still Likely Well Flagged

Mitsubishi Electric (6503 JP) is looking to raise approximately US$800m through an accelerated secondary block deal, via selling 50.71m shares...

Ethan Aw

Johnson Hitachi (JCHAC IN) | Losing Its "Cool"

In spite of a sharp correction in price, Johnson Hitachi (JCHAC IN) is best an AVOID. Product quality issues and loss in market share imply more...

Pranav Bhavsar

India Channel Insight #41 | Haier, Samsung, Voltas

The Indian durables market is witnessing changing consumer behaviour aiding an optimistic outlook for FY23 along increasing competitive intensity...

Pranav Bhavsar

Johnson Controls-Hitachi (JCHAC IN) | Irreparable Loss in Market Share

Our channel checks across dealers indicate an irreparable loss in market share for Hitachi in the Indian Air Conditioner (AC) market.

Pranav Bhavsar

Johnson Controls-Hitachi Air Conditioning India - Margin Pressure Offsets Topline Growth

JCH-IN posted revenue of Rs6.9bn in 4QFY22, up 19.8% YoY. The topline was below our estimate by 9.5%, but above consensus estimate by 7.4%.

Nirmal Bang