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>Twelve local persons tested positive for COVID-19 in Shanghai. The pandemic might begin to spread in the south of China.</li>
<li>Delivery companies’ competition is close to an end. Prices may rise significantly if some companies exit the market.</li>
<li>News about Tencent’s WeChat, QQ, and Music.</li>
</ul>


Twelve local persons tested positive for COVID-19 in Shanghai. The pandemic might begin to spread in the south of China.
Delivery companies’ competition is close to an end. Prices may rise significantly if some companies exit the market.
News about Tencent’s WeChat, QQ, and Music.


China Internet Weekly (25Jan2021): Community Locked Down in Shanghai, Delivery Companies Polarized

ASEAN Insight Provider, CrossASEAN Research

Angus Mackintosh

ASEAN Insight Provider

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

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<a href="https://www.smartkarma.com/entities/adi-sarana-armada-tbk-pt" target="_blank" data-smartkarma-citation="entities:16947:1" rel="noopener">Adi Sarana Armada (ASSA IJ)</a> is well-known for its car leasing business in Indonesia, as one of the largest players in long-term car leasing through ASSA Rent, with around 13% market share. It is less well appreciated as a major player in logistics and for its technology-based express logistics company Anteraja, which services the booming e-commerce space in Indonesia. 
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The company is also the no.1 used car auction player through JBA, with around 40% market share, providing a service for the majority of Indonesia's auto finance companies.
<a href="https://www.smartkarma.com/entities/adi-sarana-armada-tbk-pt" target="_blank" data-smartkarma-citation="entities:16947:1" rel="noopener">Adi Sarana Armada (ASSA IJ)</a> also has a complementary C2C online marketplace selling vehicles, which is connected to its used car and auction business. 
The company's core car rental business will see growth of +10-15% as the economy recovers but Anteraja will see stronger growth driving the top line to grow +25% in 2021. Management expects Anteraja to account for more than 50% of sales in 1-2 years. 
<a href="https://www.smartkarma.com/entities/adi-sarana-armada-tbk-pt" target="_blank" data-smartkarma-citation="entities:16947:1" rel="noopener">Adi Sarana Armada (ASSA IJ)</a> currently trades on an FY21E PER multiple of 20.1x and F22E PER of 16.9x, which does not look expensive given the potential digital transformation ahead.


Adi Sarana Armada (ASSA IJ) is well-known for its car leasing business in Indonesia, as one of the largest players in long-term car leasing through ASSA Rent, with around 13% market share. It is less well appreciated as a major player in logistics and for its technology-based express logistics company Anteraja, which services the booming e-commerce space in Indonesia. 

The company is also the no.1 used car auction player through JBA, with around 40% market share, providing a service for the majority of Indonesia's auto finance companies.
Adi Sarana Armada (ASSA IJ) also has a complementary C2C online marketplace selling vehicles, which is connected to its used car and auction business. 
The company's core car rental business will see growth of +10-15% as the economy recovers but Anteraja will see stronger growth driving the top line to grow +25% in 2021. Management expects Anteraja to account for more than 50% of sales in 1-2 years. 
Adi Sarana Armada (ASSA IJ) currently trades on an FY21E PER multiple of 20.1x and F22E PER of 16.9x, which does not look expensive given the potential digital transformation ahead. 

Adi Sarana Armada (ASSA IJ) - Auto Leasing, Logistics, and the Last Mile

Asian Equities Analyst, Logistics & Transport, Tracking Traffic

Daniel Hellberg

Asian Equities Analyst, Logistics & Transport

Tracking Traffic

Focusing on Asian logistics, transportation, and travel companies

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Although slightly weaker than the exceptional growth reported in September and October, Chinese express parcel volume growth remained strong in December, up 37% YoY. 
Unfortunately, pricing remained weak in December, with some companies reporting YoY unit  declines of more than 25%. Such sharp declines can quickly erode profit margins and cash flow. 
Our investment thesis for the sector remains intact: growing financial pressures within China's express sector will lead to necessary industry consolidation, probably in 2021.




Although slightly weaker than the exceptional growth reported in September and October, Chinese express parcel volume growth remained strong in December, up 37% YoY. 
Unfortunately, pricing remained weak in December, with some companies reporting YoY unit  declines of more than 25%. Such sharp declines can quickly erode profit margins and cash flow. 
Our investment thesis for the sector remains intact: growing financial pressures within China's express sector will lead to necessary industry consolidation, probably in 2021. 

TRACKING TRAFFIC/Chinese Express: Volumes UP | Pricing DOWN | Time for Consolidation

Equity Capital Markets

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The goal of this new product is to monitor the progress of upcoming and recently-completed IPOs and deals in the Asian logistics, transportation and travel space. We'll also look at deals in related segments, including eCommerce fulfillment, ride-hailing, online food delivery, and warehousing.
Each issue will feature news and commentary on planned IPOs and other major deals in the logistics space, plus an update on the performance of recent IPOs and deals. We'll also profile a prominent private Asian company in the sector that could soon seek a public listing.  
In this issue we review planned listings from <a href="https://www.smartkarma.com/entities/dida-inc" target="_blank" data-smartkarma-citation="entities:29701:1" rel="noopener">Dida (DIDA HK)</a> and <a href="https://www.smartkarma.com/entities/zim-integrated-shipping-services-ltd" target="_blank" data-smartkarma-citation="entities:31124:1" rel="noopener">ZIM Integrated Shipping Services (ZIM US)</a>, check in on the share performance of four recent logistics-related IPOs, and introduce private Hive-Box Holdings (HBH), the world's largest operator of smart lockers.




The goal of this new product is to monitor the progress of upcoming and recently-completed IPOs and deals in the Asian logistics, transportation and travel space. We'll also look at deals in related segments, including eCommerce fulfillment, ride-hailing, online food delivery, and warehousing.
Each issue will feature news and commentary on planned IPOs and other major deals in the logistics space, plus an update on the performance of recent IPOs and deals. We'll also profile a prominent private Asian company in the sector that could soon seek a public listing.  
In this issue we review planned listings from Dida (DIDA HK) and ZIM Integrated Shipping Services (ZIM US), check in on the share performance of four recent logistics-related IPOs, and introduce private Hive-Box Holdings (HBH), the world's largest operator of smart lockers. 

TRACKING TRAFFIC/Logistics Capital Markets Monitor | IPOs | M&A | Pre-IPO Profile: Hive-Box Holdings

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It's been a long time since we looked at and wrote about <a href="https://www.smartkarma.com/entities/cj-korea-express-corp" target="_blank" data-smartkarma-citation="entities:11557:1" rel="noopener">CJ Logistics (000120 KS)</a>. In a note we published here way back in June 2017, we said it was highly unlikely CJ Logistics would see the margin improvement needed to hit analysts' consensus forecast of 6,400 won per share in 2018.
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Specifically, we doubted that higher margins would be driven by growth of the company's Global segment, which includes CJ's international freight forwarding business and several overseas logistics units CJ had acquired in an effort to create a "Pan-Asian Logistics Network".
Since we last wrote about the company, CJ Logistics has apparently abandoned its push to become a major player in logistics outside of Korea, focusing instead on a disparate list of domestic initiatives. Overall profitability remains similar to depressed levels from 3-4 years ago. 
Since we last tracked them, CJ Logistics' shares haven't performed well: they're down about 24% compared to their 5-year high reached in mid-2016, though like many stocks they have risen from depressed Q120 levels. Unless CJ Logistics can articulate a winning long-term strategy, and then show consistent progress towards executing it successfully, we would avoid the shares.



It's been a long time since we looked at and wrote about CJ Logistics (000120 KS). In a note we published here way back in June 2017, we said it was highly unlikely CJ Logistics would see the margin improvement needed to hit analysts' consensus forecast of 6,400 won per share in 2018.

Specifically, we doubted that higher margins would be driven by growth of the company's Global segment, which includes CJ's international freight forwarding business and several overseas logistics units CJ had acquired in an effort to create a "Pan-Asian Logistics Network".
Since we last wrote about the company, CJ Logistics has apparently abandoned its push to become a major player in logistics outside of Korea, focusing instead on a disparate list of domestic initiatives. Overall profitability remains similar to depressed levels from 3-4 years ago. 
Since we last tracked them, CJ Logistics' shares haven't performed well: they're down about 24% compared to their 5-year high reached in mid-2016, though like many stocks they have risen from depressed Q120 levels. Unless CJ Logistics can articulate a winning long-term strategy, and then show consistent progress towards executing it successfully, we would avoid the shares. 

CJ Logistics: Still Lacking Focus, Still Unlikely to Reach 6,000+ EPS Any Time Soon

China

S.F. Holding Co., Ltd operates as a holding company. The Company, through its subsidiaries, provides logistics, order tracking, supply chain management, and warehousing services. S.F. Holding operates worldwide.

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S.F. Holding (002352 CH)

China Internet Weekly (25Jan2021): Community Locked Down in Shanghai, Delivery Companies Polarized

Twelve local persons tested positive for COVID-19 in Shanghai. Delivery companies’ competition is close to an end. News about Tencent’s WeChat, QQ,...

Ming Lu

Adi Sarana Armada (ASSA IJ) - Auto Leasing, Logistics, and the Last Mile

ASSA is Indonesia's leading B2B car leasing company moving aggressively into related businesses of auto auctions, logistics, and the last mile...

Angus Mackintosh

TRACKING TRAFFIC/Chinese Express: Volumes UP | Pricing DOWN | Time for Consolidation

Although express parcel volume growth remained strong in December, unit pricing was still weak, and we expect more companies to report losses in Q4...

Tracking Traffic

TRACKING TRAFFIC/Logistics Capital Markets Monitor | IPOs | M&A | Pre-IPO Profile: Hive-Box Holdings

In this week's Logistics Capital Markets Monitor: updates on ZIM and DiDa ChuXing IPOs, performance of recent IPOs in the Logistics space, and a...

Tracking Traffic

CJ Logistics: Still Lacking Focus, Still Unlikely to Reach 6,000+ EPS Any Time Soon

We check in on CJ Logistics, which appears to have pivoted away from its much-hyped international expansion plan from a few years ago. What hasn't...

Tracking Traffic

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