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.

Equity Capital Markets

Founded as a search engine business in 2000, <a href="https://www.smartkarma.com/entities/baidu-inc" target="_blank" data-smartkarma-citation="entities:179:1" rel="noopener">Baidu (BIDU US)</a> is today a leading internet platform with a focus on AI. Baidu passed its Hong Kong listing committee hearing and could raise up to $5 billion through a secondary listing, according to press reports. Baidu is following hot in the heels of <a href="https://www.smartkarma.com/entities/autohome-inc-adr" target="_blank" data-smartkarma-citation="entities:20234:1" rel="noopener">Autohome Inc (Adr) (ATHM US)</a>, by joining a new wave of Hong Kong secondary listings set to hit the screens in the coming months. Baidu like several companies which pursued secondary listings does not require the funds as its cash-rich and highly cash generative. <div class="content-highlight">We think that Baidu is making great strides in expanding its total addressable market (TAM) through ongoing investments. Baidu’s TAM for knowledge and information-centric Internet platforms and non-advertising business (excluding Robotaxi) in China is estimated at RMB342 billion and RMB4,134 billion in 2025, respectively, according to CIC. In combination with the potential valuation upside to the last close price (based on SoTP), we think that the equity story is attractive. </div>

Founded as a search engine business in 2000, Baidu (BIDU US) is today a leading internet platform with a focus on AI. Baidu passed its Hong Kong listing committee hearing and could raise up to $5 billion through a secondary listing, according to press reports. Baidu is following hot in the heels of Autohome Inc (Adr) (ATHM US), by joining a new wave of Hong Kong secondary listings set to hit the screens in the coming months. Baidu like several companies which pursued secondary listings does not require the funds as its cash-rich and highly cash generative. We think that Baidu is making great strides in expanding its total addressable market (TAM) through ongoing investments. Baidu’s TAM for knowledge and information-centric Internet platforms and non-advertising business (excluding Robotaxi) in China is estimated at RMB342 billion and RMB4,134 billion in 2025, respectively, according to CIC. In combination with the potential valuation upside to the last close price (based on SoTP), we think that the equity story is attractive. 

Baidu Secondary Listing: Searching for the Next Big Thing

Equity Analyst, LightStream Research

Shifara Samsudeen, FCMA, CGMA

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.

<a href="https://www.smartkarma.com/entities/tencent-music-entertainment" target="_blank" data-smartkarma-citation="entities:27255:1" rel="noopener">Tencent Music (TME US)</a>  is the leading online music entertainment platform in China offering online music, online karaoke, and music-centric live streaming services. It has been reported by several news media outlets that TME is planning for a secondary listing in Hong Kong and could raise as much as US$5bn through the secondary listing. The company went public through an IPO in 2018 on the New York Stock Exchange.This is the First of a series of reports on Tencent Music Entertainment (TME), where we will be deep diving into the company’s business model, its segments and revenues.

Tencent Music (TME US)  is the leading online music entertainment platform in China offering online music, online karaoke, and music-centric live streaming services. It has been reported by several news media outlets that TME is planning for a secondary listing in Hong Kong and could raise as much as US$5bn through the secondary listing. The company went public through an IPO in 2018 on the New York Stock Exchange.This is the First of a series of reports on Tencent Music Entertainment (TME), where we will be deep diving into the company’s business model, its segments and revenues.

TME Secondary Listing: Monetisation Efforts in Social Entertainment Should Boost Top Line Growth

Overseas Chinese Equities, Aequitas Research

Ming Lu

Overseas Chinese Equities

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 Bottom-Up

<ul>
<li>Kuaishou (1024 HK)’s vice president of community content was arrested for taking bribes.</li>
<li>Alibaba (BABA)’s public relation manager was rumored to jump off the office building in Beijing.</li>
<li>Suning Commerce (002024 CN)’s founder will sell his shareholdings.</li>
</ul>


Kuaishou (1024 HK)’s vice president of community content was arrested for taking bribes.
Alibaba (BABA)’s public relation manager was rumored to jump off the office building in Beijing.
Suning Commerce (002024 CN)’s founder will sell his shareholdings.


China Internet Weekly (Feb 22): Kuaishou VP Arrested, BABA Manager Dead “by Accident”, & Q4 Results

Global Emerging Market Equities, Propitious Research

Wium Malan, CFA

Global Emerging Market Equities

Since my last detailed look at <a href="https://www.smartkarma.com/entities/baidu-inc" target="_blank" data-smartkarma-citation="entities:179:1" rel="noopener">Baidu (BIDU US)</a>’s valuation back in September last year (<a href="https://www.smartkarma.com/insights/baidu-strategies-for-operating-in-an-industry-in-decline" target="_blank" data-smartkarma-citation="insights:43393" rel="noopener">Baidu: Strategies for Operating in an Industry in Decline</a>) Baidu’s share price has witnessed a meteoric rise of 170%, re-rating from 6.2x to 16.9x NTM EV/EBITDA.This has been driven by several catalysts, such as M&amp;A into live streaming, increased share buybacks, the continued prospect of a Hong Kong listing, and improved reported earnings, but most-of-all, by their announcement that they plan to start an intelligent electric vehicle company in strategic partnership with <a href="https://www.smartkarma.com/entities/geely-automobile-holdings-ltd" target="_blank" data-smartkarma-citation="entities:127:1" rel="noopener">Geely Auto (175 HK)</a>. Following their recent 4Q20 results, management also went to great lengths to highlight the revenue growth acceleration in their “Non-marketing Baidu Core” sub-segment, emphasising the shift away from their traditional Core Search Advertising, or mobile ecosystem, to diversify revenue streams. In this insight, I take a closer look at this sub-segment and analyse what the current market value implies for those operations, as well as their future “intelligent electric vehicle” venture.

Since my last detailed look at Baidu (BIDU US)’s valuation back in September last year (Baidu: Strategies for Operating in an Industry in Decline) Baidu’s share price has witnessed a meteoric rise of 170%, re-rating from 6.2x to 16.9x NTM EV/EBITDA.This has been driven by several catalysts, such as M&amp;A into live streaming, increased share buybacks, the continued prospect of a Hong Kong listing, and improved reported earnings, but most-of-all, by their announcement that they plan to start an intelligent electric vehicle company in strategic partnership with Geely Auto (175 HK). Following their recent 4Q20 results, management also went to great lengths to highlight the revenue growth acceleration in their “Non-marketing Baidu Core” sub-segment, emphasising the shift away from their traditional Core Search Advertising, or mobile ecosystem, to diversify revenue streams. In this insight, I take a closer look at this sub-segment and analyse what the current market value implies for those operations, as well as their future “intelligent electric vehicle” venture.

Baidu: A Closer Look at Non-Marketing Baidu Core. What Are We Paying for EV?

<ul>
<li>Baidu (BIDU), iQiyi (IQ), Trip.com (TCOM), and Autohome (ATHM) got negative industry data for the whole year of 2020.</li>
<li>A Meituan delivery worker appeared in a Freshippo store, but Meituan should be a major competitor of Freshippo’s related party, Ele.me.</li>
</ul>


Baidu (BIDU), iQiyi (IQ), Trip.com (TCOM), and Autohome (ATHM) got negative industry data for the whole year of 2020.
A Meituan delivery worker appeared in a Freshippo store, but Meituan should be a major competitor of Freshippo’s related party, Ele.me.


China Internet Weekly (15Feb2021): Meituan Employee Showed up in Freshippo, Bad Data for Four Apps

China

iQIYI, Inc. offers video entertainment services. The Company provides movies, television dramas, variety shows, and other video contents. iQIYI offers services worldwide.

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iQIYI Inc (IQ US)

Baidu Secondary Listing: Searching for the Next Big Thing

Baidu could raise up to $5 bn through a secondary listing, according to press reports. In combination with the upside to our SoTP valuation, we...

Arun George

China Internet Weekly (Feb 22): Kuaishou VP Arrested, BABA Manager Dead “by Accident”, & Q4 Results

Kuaishou’s vice president was arrested for taking bribes. Alibaba’s manager was rumored to jump off the office building. Suning Commerce’s founder...

Ming Lu

Baidu: A Closer Look at Non-Marketing Baidu Core. What Are We Paying for EV?

In this insight, I take a closer look at “Non-marketing Baidu Core” and analyse what the current market value implies for those operations, as well...

Wium Malan, CFA

China Internet Weekly (15Feb2021): Meituan Employee Showed up in Freshippo, Bad Data for Four Apps

Baidu , iQiyi, Trip.com, and Autohome got negative industry data.A Meituan delivery worker showed up in a Freshippo store.

Ming Lu

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Baidu Secondary Listing: Searching for the Next Big Thing

Baidu could raise up to $5 bn through a secondary listing, according to press reports. In combination with the upside to our SoTP valuation, we...

Arun George

TME Secondary Listing: Monetisation Efforts in Social Entertainment Should Boost Top Line Growth

This is the First of a series of reports on Tencent Music Entertainment (TME), where we will be deep diving into the company’s business model, its...

Shifara Samsudeen, FCMA, CGMA

China Internet Weekly (Feb 22): Kuaishou VP Arrested, BABA Manager Dead “by Accident”, & Q4 Results

Kuaishou’s vice president was arrested for taking bribes. Alibaba’s manager was rumored to jump off the office building. Suning Commerce’s founder...

Ming Lu

Baidu: A Closer Look at Non-Marketing Baidu Core. What Are We Paying for EV?

In this insight, I take a closer look at “Non-marketing Baidu Core” and analyse what the current market value implies for those operations, as well...

Wium Malan, CFA

China Internet Weekly (15Feb2021): Meituan Employee Showed up in Freshippo, Bad Data for Four Apps

Baidu , iQiyi, Trip.com, and Autohome got negative industry data.A Meituan delivery worker showed up in a Freshippo store.

Ming Lu