Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>On 5 September, <a href="https://www.smartkarma.com/entities/jfe-holdings-inc" target="_blank" data-smartkarma-citation="entities:210:1" rel="noopener">JFE Holdings (5411 JP)</a> saw an article out of a capital raising. It was confirmed later in the day. Huge volumes traded. The stock fell sharply.</li>
<li>The offering supply/demand dynamics are.... complicated. The offering is to foreign instos. The net demand is probably mostly retail and index, and positioning is... also complicated.</li>
<li>The EPS dilution is already accounted for. The fall against Nippon Steel pretty much does it after considering the discount expected. </li>
</ul>


On 5 September, JFE Holdings (5411 JP) saw an article out of a capital raising. It was confirmed later in the day. Huge volumes traded. The stock fell sharply.
The offering supply/demand dynamics are.... complicated. The offering is to foreign instos. The net demand is probably mostly retail and index, and positioning is... also complicated.
The EPS dilution is already accounted for. The fall against Nippon Steel pretty much does it after considering the discount expected. 


JFE Holdings (5411) - Volume Patterns Indicate Possible Squeeziness

<ul>
<li>Today <a href="https://www.smartkarma.com/entities/jfe-holdings-inc" target="_blank" data-smartkarma-citation="entities:210:1" rel="noopener">JFE Holdings (5411 JP)</a> announced it would raise ~JPY 121bn in an equity offering of 55mm treasury shares and JPY 90bn in a Convertible Bond offering. </li>
<li>¥125bn will be spent on capex for expansion, ¥75bn for capex, investments, and R&amp;D related to decarbonisation, as well as repayment of debt to 2028.</li>
<li>This is a heavier than a "normal" equity offering. And recent large-ish equity offerings seem to have more volatility in outcome (post-offer overhang, or squeeze) than previous years.</li>
</ul>


Today JFE Holdings (5411 JP) announced it would raise ~JPY 121bn in an equity offering of 55mm treasury shares and JPY 90bn in a Convertible Bond offering. 
¥125bn will be spent on capex for expansion, ¥75bn for capex, investments, and R&amp;D related to decarbonisation, as well as repayment of debt to 2028.
This is a heavier than a "normal" equity offering. And recent large-ish equity offerings seem to have more volatility in outcome (post-offer overhang, or squeeze) than previous years.


APAC IPOs & Placements, Aequitas Research

Clarence Chu

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

<ul>
<li>
<a href="https://www.smartkarma.com/entities/jfe-holdings-inc" target="_blank" data-smartkarma-citation="entities:210:1" rel="noopener">JFE Holdings (5411 JP)</a> is looking to raise around US$870m to fund its capacity expansion plans. Together with the offering, it will undertake a US$610m CB issuance.</li>
<li>The deal appears to be well flagged with the firm disclosing its JV and other related CapEx plans in its earlier earnings announcement.</li>
<li>Overall, the new shares would result in a 8.2% dilution and represent 12 days of three month ADV.</li>
</ul>



JFE Holdings (5411 JP) is looking to raise around US$870m to fund its capacity expansion plans. Together with the offering, it will undertake a US$610m CB issuance.
The deal appears to be well flagged with the firm disclosing its JV and other related CapEx plans in its earlier earnings announcement.
Overall, the new shares would result in a 8.2% dilution and represent 12 days of three month ADV.


JFE Holdings Placement - Well Flagged, but Would Probably Need a Wider Correction

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

<ul>
<li>The bullish outlook for global equities (MSCI ACWI) that we initiated in early November 2023 remains intact; continue to ride this trend higher.</li>
<li>Many of the heavily-weighted countries in terms of global market capitalization (U.S., Europe, Japan) are extended; we'd welcome some consolidation, though it may come from higher levels.</li>
<li>Ultimately, market dynamics remain healthy, and we would treat pullbacks as buying opportunities. Downgrading India to market weight. Actionable Themes: Global Materials, Energy, Consumer Discretionary, and Industrials</li>
</ul>


The bullish outlook for global equities (MSCI ACWI) that we initiated in early November 2023 remains intact; continue to ride this trend higher.
Many of the heavily-weighted countries in terms of global market capitalization (U.S., Europe, Japan) are extended; we'd welcome some consolidation, though it may come from higher levels.
Ultimately, market dynamics remain healthy, and we would treat pullbacks as buying opportunities. Downgrading India to market weight. Actionable Themes: Global Materials, Energy, Consumer Discretionary, and Industrials


Bullish Outlook Intact; Downgrading India; Buys in Materials, Energy, Discretionary, Industrials

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

<ul>
<li>
<a href="https://www.smartkarma.com/entities/seibu-giken-co-ltd" target="_blank" data-smartkarma-citation="entities:40113:1" rel="noopener">Seibu Giken (6223 JP)</a> (SG) raised around US$93m in its Japan IPO after pricing at the top of its downward revised range.</li>
<li>SG sells desiccant dehumidifiers and VOC concentrators in over fifty countries globally. Its two main products accounted for over 90% of its revenue in 2022.</li>
<li>In our previous notes, we looked at the company’s past performance and valuation. In this note, we talk about the trading dynamics.</li>
</ul>



Seibu Giken (6223 JP) (SG) raised around US$93m in its Japan IPO after pricing at the top of its downward revised range.
SG sells desiccant dehumidifiers and VOC concentrators in over fifty countries globally. Its two main products accounted for over 90% of its revenue in 2022.
In our previous notes, we looked at the company’s past performance and valuation. In this note, we talk about the trading dynamics.


Seibu Giken IPO Trading - Still Not Particularly Enticing

Japan

JFE Holdings, Inc. is a holding company which was established through the merger of NKK Corp and Kawasaki Steel Corp.  The Company manages and conducts its subsidiaries' business, which is steel production and integrated engineering services.

JFE Holdings (5411 JP)

JFE Holdings (5411) - Volume Patterns Indicate Possible Squeeziness

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Travis Lundy

JFE Holdings (5411) Stock+CB Offering

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Travis Lundy

JFE Holdings Placement - Well Flagged, but Would Probably Need a Wider Correction

JFE Holdings (5411 JP) is looking to raise around US$870m to fund its capacity expansion plans. Together with the offering, it will undertake a...

Clarence Chu

Bullish Outlook Intact; Downgrading India; Buys in Materials, Energy, Discretionary, Industrials

Bullish Outlook Intact on MSCI ACWI; Downgrading India to Market; Market Dynamics Healthy; Treat Pullbacks as Buying Opportunities; Buys in global...

Vermilion Research

Seibu Giken IPO Trading - Still Not Particularly Enticing

Seibu Giken (6223 JP) (SG) raised around US$93m in its Japan IPO after pricing at the top of its downward revised range. In this note we talk about...

Sumeet Singh

JFE Holdings (5411) - Volume Patterns Indicate Possible Squeeziness

​JFE Holdings fell sharply after a capital raising announcement. Supply/demand is complicated. Foreign instos are asked to buy. Retail buys in the...

Travis Lundy

JFE Holdings (5411) Stock+CB Offering

JFE Holdings, which hit a 13yr high yesterday, announced an equity+CB offering today. It's an international offering only, meaning active foreign...

Travis Lundy

JFE Holdings Placement - Well Flagged, but Would Probably Need a Wider Correction

JFE Holdings (5411 JP) is looking to raise around US$870m to fund its capacity expansion plans. Together with the offering, it will undertake a...

Clarence Chu

Bullish Outlook Intact; Downgrading India; Buys in Materials, Energy, Discretionary, Industrials

Bullish Outlook Intact on MSCI ACWI; Downgrading India to Market; Market Dynamics Healthy; Treat Pullbacks as Buying Opportunities; Buys in global...

Vermilion Research

Seibu Giken IPO Trading - Still Not Particularly Enticing

Seibu Giken (6223 JP) (SG) raised around US$93m in its Japan IPO after pricing at the top of its downward revised range. In this note we talk about...

Sumeet Singh

JFE Holdings fell sharply after a capital raising announcement. Supply/demand is complicated. Foreign instos are asked to buy. Retail buys in the...