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/sanrio-co-ltd" target="_blank" data-smartkarma-citation="entities:16476:1" rel="noopener">Sanrio (8136 JP)</a> has announced a secondary offering of up to 25.9  million shares (29.8 million including overallotment), worth around US$840 million (US$970 million including overallotment). </li>
<li>Sanrio's goal with the secondary offering is (i) to reduce cross-shareholdings and (ii) to expand and diversify the shareholder base, which should further enhance liquidity.</li>
<li>Looking at recent large Japanese placements is instructive for understanding the potential offer price. The pricing date will fall between 10 and 13 December (likely 10 December).</li>
</ul>



Sanrio (8136 JP) has announced a secondary offering of up to 25.9  million shares (29.8 million including overallotment), worth around US$840 million (US$970 million including overallotment). 
Sanrio's goal with the secondary offering is (i) to reduce cross-shareholdings and (ii) to expand and diversify the shareholder base, which should further enhance liquidity.
Looking at recent large Japanese placements is instructive for understanding the potential offer price. The pricing date will fall between 10 and 13 December (likely 10 December).


Sanrio (8136 JP): A US$840 Million Secondary Offering

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.

Kioxia Holdings  / Equity Capital Markets

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<li>
<a href="https://www.smartkarma.com/entities/kioxia-holdings-corp" target="_blank" data-smartkarma-citation="entities:29243:1" rel="noopener">Kioxia Holdings (6600 JP)</a> is aiming to raise around US$700m (including over-allocation) from its Japan IPO.</li>
<li>It was the world’s largest pure-play NAND flash memory supplier, in terms of both revenue and unit shipments in 2023, according to TechInsights.</li>
<li>In this note, we talk about the not-so-positive aspects of the deal.</li>
</ul>



Kioxia Holdings (6600 JP) is aiming to raise around US$700m (including over-allocation) from its Japan IPO.
It was the world’s largest pure-play NAND flash memory supplier, in terms of both revenue and unit shipments in 2023, according to TechInsights.
In this note, we talk about the not-so-positive aspects of the deal.


Kioxoa Pre-IPO - The Negatives - Still a Follower of the Cycle

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Keisei Electric Railway Co / Event-Driven

<ul>
<li>13mos ago, activist investor Palliser Capital spoke at a conference about the value offered by <a href="https://www.smartkarma.com/entities/keisei-electric-railway-co" target="_blank" data-smartkarma-citation="entities:10876:1" rel="noopener">Keisei Electric Railway Co (9009 JP)</a> due to its large stake in Oriental Land (4661). </li>
<li>Keisei outperformed OLC by 30% over 3.5mos. Then it fell all the way back, and more, over the next five months. Asset sale, buyback, AGM proposals. Meh. </li>
<li>Nov 25th, Toyo Keizai <a href="https://toyokeizai.net/articles/-/842158" target="_blank" rel="noopener">wrote</a> activist Murakami-san had acquired stakes of &lt;5% in <a href="https://www.smartkarma.com/entities/keikyu-corp" target="_blank" data-smartkarma-citation="entities:3371:1" rel="noopener">Keikyu Corp (9006 JP)</a> and &lt;1% in <a href="https://www.smartkarma.com/entities/keisei-electric-railway-co" target="_blank" data-smartkarma-citation="entities:10876:1" rel="noopener">Keisei Electric Railway Co (9009 JP)</a>. Shares in both jumped.</li>
</ul>


13mos ago, activist investor Palliser Capital spoke at a conference about the value offered by Keisei Electric Railway Co (9009 JP) due to its large stake in Oriental Land (4661). 
Keisei outperformed OLC by 30% over 3.5mos. Then it fell all the way back, and more, over the next five months. Asset sale, buyback, AGM proposals. Meh. 
Nov 25th, Toyo Keizai wrote activist Murakami-san had acquired stakes of &lt;5% in Keikyu Corp (9006 JP) and &lt;1% in Keisei Electric Railway Co (9009 JP). Shares in both jumped.


[JAPAN ACTIVISM] Keisei Elec (9009) - Murakami Stake Causes Pop But the Oppty Is Still Unconvincing

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<li>On 13 November, <a href="https://www.smartkarma.com/entities/kansai-electric-power-co-inc" target="_blank" data-smartkarma-citation="entities:18907:1" rel="noopener">Kansai Electric Power (9503 JP)</a> announced an equity offering to raise capital for capex expenditures over the next several years. It is significantly dilutive.</li>
<li>The shares responded by falling 23% to 8-months lows of ¥1,850 last Thursday and Friday. That puts the stock at the same forward PER post-offering as it was pre-offering. </li>
<li>That's probably not an awful place to own now that the stock will have been slightly de-risked/de-levered. </li>
</ul>


On 13 November, Kansai Electric Power (9503 JP) announced an equity offering to raise capital for capex expenditures over the next several years. It is significantly dilutive.
The shares responded by falling 23% to 8-months lows of ¥1,850 last Thursday and Friday. That puts the stock at the same forward PER post-offering as it was pre-offering. 
That's probably not an awful place to own now that the stock will have been slightly de-risked/de-levered. 


Kansai Electric Power (9503 JP) - Huge Offering Is Smaller Now; Reward/Risk Skews Upwards

Kansai Electric Power / Equity Capital Markets

<ul>
<li>Since the US$3.5 billion primary/secondary offering announcement, <a href="https://www.smartkarma.com/entities/kansai-electric-power-co-inc" target="_blank" data-smartkarma-citation="entities:18907:1" rel="noopener">Kansai Electric Power (9503 JP)</a>’s shares have been down 20.6% from the undisturbed price of JPY2,397 per share (13 November).</li>
<li>Looking at recent large Japanese placements is instructive to understand the potential trading pattern. So far, KEPCO’s shares have followed the pattern of previous large placements.</li>
<li>The offering will likely be priced on 26 November. The average large Japanese placement tends to generate positive returns.</li>
</ul>


Since the US$3.5 billion primary/secondary offering announcement, Kansai Electric Power (9503 JP)’s shares have been down 20.6% from the undisturbed price of JPY2,397 per share (13 November).
Looking at recent large Japanese placements is instructive to understand the potential trading pattern. So far, KEPCO’s shares have followed the pattern of previous large placements.
The offering will likely be priced on 26 November. The average large Japanese placement tends to generate positive returns.


Kansai Electric Power (9503 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)

Sanrio (8136 JP): A US$840 Million Secondary Offering

The offering as a percentage of outstanding shares and ADV is small compared to the recent large Japanese placement. Looking at recent large...

Arun George

Kioxoa Pre-IPO - The Negatives - Still a Follower of the Cycle

Kioxia Holdings (6600 JP) is aiming to raise around US$700m (including over-allocation) from its Japan IPO. In this note, we talk about the not-so...

Sumeet Singh

[JAPAN ACTIVISM] Keisei Elec (9009) - Murakami Stake Causes Pop But the Oppty Is Still Unconvincing

Toyo Keizai put out an article on Keisei based on a quote from a "market insider". Keisei shares popped 16% in 2 days. There's value, but less than...

Travis Lundy