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

<ul>
<li>
<a href="https://www.smartkarma.com/entities/nintendo-co-ltd" target="_blank" data-smartkarma-citation="entities:5415:1" rel="noopener">Nintendo (7974 JP)</a> has announced a secondary offering of 32.7 million shares (37.6 million including overallotment), worth around US$1.8 billion (US$2.1 billion including overallotment).</li>
<li>There are four selling shareholders: Nomura Trust and Banking Co, Bank of Kyoto, <a href="https://www.smartkarma.com/entities/dena-co-ltd" target="_blank" data-smartkarma-citation="entities:747:1" rel="noopener">DeNA (2432 JP)</a>, and Resona Bank.</li>
<li>The offering as a percentage of outstanding shares and ADV is below average compared to recent large placements. A ToSTNeT-3 repurchase (up to JPY100 billion) will mitigate the impact.</li>
</ul>



Nintendo (7974 JP) has announced a secondary offering of 32.7 million shares (37.6 million including overallotment), worth around US$1.8 billion (US$2.1 billion including overallotment).
There are four selling shareholders: Nomura Trust and Banking Co, Bank of Kyoto, DeNA (2432 JP), and Resona Bank.
The offering as a percentage of outstanding shares and ADV is below average compared to recent large placements. A ToSTNeT-3 repurchase (up to JPY100 billion) will mitigate the impact.


Nintendo (7974 JP): A US$2.1 Billion Secondary Offering

Shin Etsu Chemical / Equity Capital Markets

<ul>
<li>Since the announcement of the US$1.0 billion secondary offering, <a href="https://www.smartkarma.com/entities/shin-etsu-chemical-co-ltd" target="_blank" data-smartkarma-citation="entities:4481:1" rel="noopener">Shin Etsu Chemical (4063 JP)</a>’s shares have declined 6.3% to the undisturbed price of JPY5,476 per share (27 January).</li>
<li>It is instructive to look at recent large Japanese placements to understand the potential trading pattern. Shin Etsu's share decline is lower than the median of recent large placements.</li>
<li>The offering will likely be priced on 4 February. The average large Japanese placement tends to generate positive returns.</li>
</ul>


Since the announcement of the US$1.0 billion secondary offering, Shin Etsu Chemical (4063 JP)’s shares have declined 6.3% to the undisturbed price of JPY5,476 per share (27 January).
It is instructive to look at recent large Japanese placements to understand the potential trading pattern. Shin Etsu's share decline is lower than the median of recent large placements.
The offering will likely be priced on 4 February. The average large Japanese placement tends to generate positive returns.


Shin Etsu Chemical (4063 JP): The Current Playbook

<ul>
<li>
<a href="https://www.smartkarma.com/entities/kandenko-co-ltd" target="_blank" data-smartkarma-citation="entities:3726:1" rel="noopener">Kandenko Co Ltd (1942 JP)</a> has announced a secondary offering of 22.8 million shares (26.2 million including overallotment), worth around US$0.8 billion (US$1.0 billion including overallotment).</li>
<li>The timing is opportunistic as the shares are up 159% in the last 12 months. Notably, the placement was announced post-close after the full-year results were <a href="https://www.kandenko.co.jp/en/docs/3Notice%20of%20Revision%20to%20Financial%20Results%20and%20Dividend%20Forecasts.pdf" target="_blank" rel="noopener">upgraded intraday</a>.</li>
<li>The offering as a percentage of outstanding shares and ADV is below average compared to recent large placements. A ToSTNeT-3 repurchase (up to JPY30 billion) will partly mitigate the impact.</li>
</ul>



Kandenko Co Ltd (1942 JP) has announced a secondary offering of 22.8 million shares (26.2 million including overallotment), worth around US$0.8 billion (US$1.0 billion including overallotment).
The timing is opportunistic as the shares are up 159% in the last 12 months. Notably, the placement was announced post-close after the full-year results were upgraded intraday.
The offering as a percentage of outstanding shares and ADV is below average compared to recent large placements. A ToSTNeT-3 repurchase (up to JPY30 billion) will partly mitigate the impact.


Kandenko (1942 JP): A US$1.0 Billion Secondary Offering

<ul>
<li>
<a href="https://www.smartkarma.com/entities/shin-etsu-chemical-co-ltd" target="_blank" data-smartkarma-citation="entities:4481:1" rel="noopener">Shin Etsu Chemical (4063 JP)</a> has announced a secondary offering of up to 23.7 million shares (27.2 million including overallotment), worth around US$0.8 billion (US$1.0 billion including overallotment).</li>
<li>The goal of the secondary offering seems to be to facilitate the exits of several shareholders and improve liquidity.</li>
<li>The offering as a percentage of outstanding shares and ADV is small compared to recent large placements. An ongoing JPY100 billion share buyback will further mitigate the impact.</li>
</ul>



Shin Etsu Chemical (4063 JP) has announced a secondary offering of up to 23.7 million shares (27.2 million including overallotment), worth around US$0.8 billion (US$1.0 billion including overallotment).
The goal of the secondary offering seems to be to facilitate the exits of several shareholders and improve liquidity.
The offering as a percentage of outstanding shares and ADV is small compared to recent large placements. An ongoing JPY100 billion share buyback will further mitigate the impact.


Shin Etsu Chemical (4063 JP): A US$1.0 Billion Secondary Offering

<ul>
<li>Since the announcement of the US$0.8 billion secondary offering, <a href="https://www.smartkarma.com/entities/toyoda-gosei-co-ltd" target="_blank" data-smartkarma-citation="entities:20125:1" rel="noopener">Toyoda Gosei (7282 JP)</a>’s shares have declined 4.9% to the undisturbed price of JPY3,754 per share (20 November).</li>
<li>It is instructive to look at recent large Japanese placements to understand the potential trading pattern. Toyoda's share decline is better than the median of recent large placements.</li>
<li>The offering will likely be priced on 1 December. The average large Japanese placement tends to generate positive returns.</li>
</ul>


Since the announcement of the US$0.8 billion secondary offering, Toyoda Gosei (7282 JP)’s shares have declined 4.9% to the undisturbed price of JPY3,754 per share (20 November).
It is instructive to look at recent large Japanese placements to understand the potential trading pattern. Toyoda's share decline is better than the median of recent large placements.
The offering will likely be priced on 1 December. The average large Japanese placement tends to generate positive returns.


Toyoda Gosei (7282 JP): The Current Playbook

Japan

The Kansai Electric Power Company, Incorporated generates electricity from hydroelectric, thermal, geothermal, and nuclear power sources.  The Company distributes electricity to Osaka and the surrounding Kansai area.  Kansai Electric also constructs and maintains electrical power facilities.

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Kansai Electric Power (9503 JP)

Nintendo (7974 JP): A US$2.1 Billion Secondary Offering

The offering as a percentage of outstanding shares and ADV is below average compared to recent large placements. A ToSTNeT-3 repurchase (up to...

Arun George

Shin Etsu Chemical (4063 JP): The Current Playbook

The offering will likely be priced on 4 February. The average large Japanese placement tends to generate positive returns.

Arun George

Kandenko (1942 JP): A US$1.0 Billion Secondary Offering

The timing of the placement after upgrading full-year forecasts will not be well-received. The offering as a percentage of out. shares and ADV are...

Arun George

Shin Etsu Chemical (4063 JP): A US$1.0 Billion Secondary Offering

The offering as a percentage of outstanding shares and ADV is small compared to recent large placements. An ongoing JPY100 billion share buyback...

Arun George

Toyoda Gosei (7282 JP): The Current Playbook

The offering will likely be priced on 1 December. The average large Japanese placement tends to generate positive returns.

Arun George

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