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/mixue-group" target="_blank" data-smartkarma-citation="entities:40623:1" rel="noopener">Mixue Group (2097 HK)</a>, a world-leading manufacturer of freshly made drinks, is seeking to raise US$445 million through an HKEx IPO.</li>
<li>We previously discussed the IPO in <a href="https://www.smartkarma.com/insights/mixue-group-2097-hk-ipo-the-bull-case" target="_blank" data-smartkarma-citation="insights:177152" rel="noopener">MIXUE Group (2097 HK) IPO: The Bull Case</a> and <a href="https://www.smartkarma.com/insights/mixue-group-2097-hk-ipo-the-bear-case" target="_blank" data-smartkarma-citation="insights:177307" rel="noopener">MIXUE Group (2097 HK) IPO: The Bear Case</a>. </li>
<li>There are five cornerstone investors. Our valuation analysis suggests Mixue is attractively valued at the IPO price range. Therefore, we would participate in the IPO.</li>
</ul>



Mixue Group (2097 HK), a world-leading manufacturer of freshly made drinks, is seeking to raise US$445 million through an HKEx IPO.
We previously discussed the IPO in MIXUE Group (2097 HK) IPO: The Bull Case and MIXUE Group (2097 HK) IPO: The Bear Case. 
There are five cornerstone investors. Our valuation analysis suggests Mixue is attractively valued at the IPO price range. Therefore, we would participate in the IPO.


MIXUE Group (2097 HK) IPO: Valuation Insights

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Index Rebalance

<ul>
<li>
<a href="https://www.smartkarma.com/entities/mixue-group" target="_blank" data-smartkarma-citation="entities:40623:1" rel="noopener">Mixue Group (MIX HK)</a> has priced its IPO at HK$202.5/share and will raise up to HK$3.97bn (US$511m) if the oversubscription option is exercised, valuing the company at HK$76.35bn (US$9.8bn).</li>
<li>Despite a US$10bn market cap, the stock will find it difficult to be added to global and local indices since 60% of the shares are unlisted.</li>
<li>The stock is likely to remain in the shadows for one global index and could be added to the other in December. HSCI inclusion could take place in September.</li>
</ul>



Mixue Group (MIX HK) has priced its IPO at HK$202.5/share and will raise up to HK$3.97bn (US$511m) if the oversubscription option is exercised, valuing the company at HK$76.35bn (US$9.8bn).
Despite a US$10bn market cap, the stock will find it difficult to be added to global and local indices since 60% of the shares are unlisted.
The stock is likely to remain in the shadows for one global index and could be added to the other in December. HSCI inclusion could take place in September.


MIXUE Group (2097 HK) IPO: Small Float to Keep Stock Out of Most Indices

HK/China Equity Long-Short

Osbert Tang, CFA

<ul>
<li>
<a href="https://www.smartkarma.com/entities/mixue-group" target="_blank" data-smartkarma-citation="entities:40623:1" rel="noopener">Mixue Group (MIX HK)</a>'s IPO price of HK$202.5 looks attractive, as it is priced at 16.6x FY24 and 13.5x FY25 PER, below the mainland China peer average. </li>
<li>We estimate a P/B of 4.6x, putting it marginally lower than the sector best-fit line. We think there is potential for at least a 20-30% upside after the IPO. </li>
<li>MIXUE offers the possibility to participate in the spin-off of its overseas businesses in the medium term, which is explicitly spelt out as a plan.</li>
</ul>



Mixue Group (MIX HK)'s IPO price of HK$202.5 looks attractive, as it is priced at 16.6x FY24 and 13.5x FY25 PER, below the mainland China peer average. 
We estimate a P/B of 4.6x, putting it marginally lower than the sector best-fit line. We think there is potential for at least a 20-30% upside after the IPO. 
MIXUE offers the possibility to participate in the spin-off of its overseas businesses in the medium term, which is explicitly spelt out as a plan.


MIXUE Group (2097 HK) IPO: Reasonably Attractive Pricing

Equity Analyst - Asia Consumer Sector, Investory

Devi Subhakesan

Equity Analyst - Asia Consumer Sector

ASIA CONSUMER: INSIGHTS AND INVESTMENT IDEAS

Investory

Investory is a Singapore-based boutique independent equity research firm founded in January 2017 with a primary focus on consumption themes across Asia-Pacific.

We aim to generate investible ideas based on consumption trends and outlook. We screen our ideas on several parameters - product potential, long-term growth and management commitment being the most critical.  We follow a fundamental analysis approach in our stock selection process and are not restricted by market cap.

We aspire to grow into a leading source of unbiased research, free of conflict of interest, for investors yearning for independent and disciplined analysis. 

We also undertake bespoke research mandates to support our Institutional clients’ investment needs.

Our team comprises of professionals with extensive experience in the Asian equity markets, in areas ranging from research, servicing institutional clients and investment management.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/mixue-group" target="_blank" data-smartkarma-citation="entities:40623:1" rel="noopener">Mixue Group (MIX HK)</a>  is offering 17.1 million shares at a price of HK$202.50 in its Hong Kong IPO aiming to raise up to HK$3.45 Bn.</li>
<li>The company demonstrated stellar growth in store count, revenue, and profits, focusing on the mass-market freshly made beverage segment despite a sector slow down in 2024.</li>
<li>Mixue’s pace of store expansion may slow down going forward, however its ultra-low prices (RMB4-10) and scale provide a strong foundation for long-term sustainable performance.</li>
</ul>



Mixue Group (MIX HK)  is offering 17.1 million shares at a price of HK$202.50 in its Hong Kong IPO aiming to raise up to HK$3.45 Bn.
The company demonstrated stellar growth in store count, revenue, and profits, focusing on the mass-market freshly made beverage segment despite a sector slow down in 2024.
Mixue’s pace of store expansion may slow down going forward, however its ultra-low prices (RMB4-10) and scale provide a strong foundation for long-term sustainable performance.


Mixue Group IPO: The Good, The Bad and Valuations

<ul>
<li>
<a href="https://www.smartkarma.com/entities/mixue-group" target="_blank" data-smartkarma-citation="entities:40623:1" rel="noopener">Mixue Group (MIX HK)</a>, a world-leading manufacturer of freshly made drinks, is seeking to raise US$445 million through an HKEx IPO.</li>
<li>In <a href="https://www.smartkarma.com/insights/mixue-group-2097-hk-ipo-the-bull-case" target="_blank" data-smartkarma-citation="insights:177152" rel="noopener">MIXUE Group (2097 HK) IPO: The Bull Case</a>, we highlighted the key elements of the bull case. In this note, we outline the bear case.</li>
<li>The bear case rests on unsustainable growth rates, pressure on KPIs, bottom-tier R&amp;D spending, high capex intensity, and bottom-tier FCF generation.   </li>
</ul>



Mixue Group (MIX HK), a world-leading manufacturer of freshly made drinks, is seeking to raise US$445 million through an HKEx IPO.
In MIXUE Group (2097 HK) IPO: The Bull Case, we highlighted the key elements of the bull case. In this note, we outline the bear case.
The bear case rests on unsustainable growth rates, pressure on KPIs, bottom-tier R&amp;D spending, high capex intensity, and bottom-tier FCF generation.   


China

MIXUE Group operates freshly-made drinks stores. The Company provides freshly-made fruit drinks, tea drinks, ice cream, and coffee. MIXUE Group conducts businesses across worldwide.

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Mixue Group (2097 HK)