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

<a href="https://www.smartkarma.com/entities/baidu-inc" target="_blank" data-smartkarma-citation="entities:179:1" rel="noopener">Baidu (BIDU US)</a> launched a $3 billion secondary listing in Hong Kong last Thursday evening. Bookbuilding is scheduled to run until the pricing on 17 March. The secondary listing has received good early demand with the books covered on the first day, according to press reports. The H-shares will begin trading on 23 March. In <a href="https://www.smartkarma.com/insights/baidu-secondary-listing-searching-for-the-next-big-thing" target="_blank" data-smartkarma-citation="insights:49043" rel="noopener">Baidu Secondary Listing: Searching for the Next Big Thing</a>, we outlined our views on Baidu’ fundamentals and valuation. Baidu is making great strides in expanding its total addressable market (TAM) through ongoing investments. In combination with the potential valuation upside to the last close price (based on SoTP), we concluded that the equity story is attractive. <div class="content-highlight">In this note, we will look at Baidu’s potential HK-ADS premium/(discount). Baidu will price its H-shares at a discount to its ADSs to entice investors to participate in the secondary listing. However, market conditions remain volatile and there remains a possibility of a renewed global equity sell-off. Consequently, Baidu will likely price its H-shares at a wider discount than the median HK-ADS discount of previous secondary listings. Overall, Baidu pricing its H-shares at a discount range of 3% to 4% to its ADSs will be reasonable.</div>

Baidu (BIDU US) launched a $3 billion secondary listing in Hong Kong last Thursday evening. Bookbuilding is scheduled to run until the pricing on 17 March. The secondary listing has received good early demand with the books covered on the first day, according to press reports. The H-shares will begin trading on 23 March. In Baidu Secondary Listing: Searching for the Next Big Thing, we outlined our views on Baidu’ fundamentals and valuation. Baidu is making great strides in expanding its total addressable market (TAM) through ongoing investments. In combination with the potential valuation upside to the last close price (based on SoTP), we concluded that the equity story is attractive. In this note, we will look at Baidu’s potential HK-ADS premium/(discount). Baidu will price its H-shares at a discount to its ADSs to entice investors to participate in the secondary listing. However, market conditions remain volatile and there remains a possibility of a renewed global equity sell-off. Consequently, Baidu will likely price its H-shares at a wider discount than the median HK-ADS discount of previous secondary listings. Overall, Baidu pricing its H-shares at a discount range of 3% to 4% to its ADSs will be reasonable.

Baidu Secondary Listing: HK-ADS Premium/​(Discount) Views

Global Emerging Market Equities, Propitious Research

Wium Malan, CFA

Global Emerging Market Equities

Thematic (Sector/Industry)

This insight provides a summary of the key news developments impacting the largest countries and constituents of the Global Emerging Markets equity indices. Companies mentioned this week:<a href="https://www.smartkarma.com/entities/sk-hynix-inc" target="_blank" data-smartkarma-citation="entities:16955:1" rel="noopener">SK Hynix (000660 KS)</a>, <a href="https://www.smartkarma.com/entities/new-oriental-education-tech-grp-adr" target="_blank" data-smartkarma-citation="entities:531:1" rel="noopener">New Oriental Education (EDU US)</a>, <a href="https://www.smartkarma.com/entities/tal-education-group" target="_blank" data-smartkarma-citation="entities:1124:1" rel="noopener">TAL Education (TAL US)</a>, <a href="https://www.smartkarma.com/entities/netease" target="_blank" data-smartkarma-citation="entities:29030:1" rel="noopener">NetEase (9999 HK)</a>, <a href="https://www.smartkarma.com/entities/bilibili-inc" target="_blank" data-smartkarma-citation="entities:26793:1" rel="noopener">Bilibili Inc (BILI US)</a>, <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent Holdings (700 HK)</a>, <a href="https://www.smartkarma.com/entities/baidu-inc" target="_blank" data-smartkarma-citation="entities:179:1" rel="noopener">Baidu (BIDU US)</a>

This insight provides a summary of the key news developments impacting the largest countries and constituents of the Global Emerging Markets equity indices. Companies mentioned this week:SK Hynix (000660 KS), New Oriental Education (EDU US), TAL Education (TAL US), NetEase (9999 HK), Bilibili Inc (BILI US), Tencent Holdings (700 HK), Baidu (BIDU US)

Global Emerging Markets Weekly: 12 March 2021

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.

<div><a href="https://www.smartkarma.com/entities/baidu-inc" target="_blank" data-smartkarma-citation="entities:179:1" rel="noopener">Baidu (BIDU US)</a> plans to raise around US$3bn in its secondary listing in Hong Kong. I have covered most aspects of the deal in my earlier note, <a href="https://www.smartkarma.com/insights/baidu-secondary-listing-early-look-will-be-one-of-the-largest-secondary-listings-this-year" target="_blank" rel="noopener">Baidu Secondary Listing Early Look - Will Be One of the Largest Secondary Listings This Year</a>.</div><div>In this note, I'll only touch upon the updates since my last note.</div>

Baidu (BIDU US) plans to raise around US$3bn in its secondary listing in Hong Kong. I have covered most aspects of the deal in my earlier note, Baidu Secondary Listing Early Look - Will Be One of the Largest Secondary Listings This Year.In this note, I'll only touch upon the updates since my last note.

Baidu Secondary Listing - Smaller than Expected, Doing the Bare Minimum

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

Equity Bottom-Up

Indonesia e-commerce player Bukalapak, which counts <a href="https://www.smartkarma.com/entities/elang-mahkota-teknologi-tbk" target="_blank" data-smartkarma-citation="entities:7752:1" rel="noopener">Emtek (EMTK IJ)</a> as its largest local backer but also has <a href="https://www.smartkarma.com/entities/microsoft-corp" target="_blank" data-smartkarma-citation="entities:15273:1" rel="noopener">Microsoft Corp (MSFT US)</a>, <a href="https://www.smartkarma.com/entities/standard-chartered-plc" target="_blank" data-smartkarma-citation="entities:193:1" rel="noopener">Standard Chartered (STAN LN)</a>, GIC, and Naver Corp is investors in reportedly in talks to list through a SPAC with a valuation of US$4bn-US$5bn, with a local listing of part of the business in Jakarta first. The timing suggests a target transaction date in 3Q2021.
Bukalapak is the No.4 e-commerce player in Indonesia with 13.5m online sellers and 100m monthly active users, competing with players such as <a href="https://www.smartkarma.com/entities/tokopedia-pt" target="_blank" data-smartkarma-citation="entities:24239:1" rel="noopener">Tokopedia PT (1087142D IJ)</a>, Shopee (<a href="https://www.smartkarma.com/entities/sea-ltd" target="_blank" data-smartkarma-citation="entities:8509:1" rel="noopener">Sea Ltd (SE US))</a>, and <a href="https://www.smartkarma.com/entities/lazada-group" target="_blank" data-smartkarma-citation="entities:26148:1" rel="noopener">Lazada Group (LAZADA SP)</a> but with an edge providing fulfillment and logistics for around 5.4m warungs (mom&amp;pop stores) in Indonesia.
The company recently saw <a href="https://www.smartkarma.com/entities/standard-chartered-plc" target="_blank" data-smartkarma-citation="entities:193:1" rel="noopener">Standard Chartered (STAN LN)</a> come in as part of a US$200m funding round, with a view of helping to build financial services through the platform and offer to its sellers and customers financial services.
<a href="https://www.smartkarma.com/entities/elang-mahkota-teknologi-tbk" target="_blank" data-smartkarma-citation="entities:7752:1" rel="noopener">Emtek (EMTK IJ)</a> is the most direct beneficiary of a listing for Bukalapak, even through a SPAC, given that it will crystallize a market value for the company. <a href="https://www.smartkarma.com/entities/elang-mahkota-teknologi-tbk" target="_blank" data-smartkarma-citation="entities:7752:1" rel="noopener">Emtek (EMTK IJ)</a>approved a stock split in December and the company has become more liquid and it may look at a further restructuring at a later stage to bring all its digital and media assets under one roof.
The IDX (Indonesia Stock Exchange) is already talking about both allowing SPACs to list in Indonesia but also more importantly to allow main-board listings for high-growth companies that may not be profitable, as well as allowing dual-class shares.

Indonesia e-commerce player Bukalapak, which counts Emtek (EMTK IJ) as its largest local backer but also has Microsoft Corp (MSFT US), Standard Chartered (STAN LN), GIC, and Naver Corp is investors in reportedly in talks to list through a SPAC with a valuation of US$4bn-US$5bn, with a local listing of part of the business in Jakarta first. The timing suggests a target transaction date in 3Q2021.
Bukalapak is the No.4 e-commerce player in Indonesia with 13.5m online sellers and 100m monthly active users, competing with players such as Tokopedia PT (1087142D IJ), Shopee (Sea Ltd (SE US)), and Lazada Group (LAZADA SP) but with an edge providing fulfillment and logistics for around 5.4m warungs (mom&amp;pop stores) in Indonesia.
The company recently saw Standard Chartered (STAN LN) come in as part of a US$200m funding round, with a view of helping to build financial services through the platform and offer to its sellers and customers financial services.
Emtek (EMTK IJ) is the most direct beneficiary of a listing for Bukalapak, even through a SPAC, given that it will crystallize a market value for the company. Emtek (EMTK IJ)approved a stock split in December and the company has become more liquid and it may look at a further restructuring at a later stage to bring all its digital and media assets under one roof.
The IDX (Indonesia Stock Exchange) is already talking about both allowing SPACs to list in Indonesia but also more importantly to allow main-board listings for high-growth companies that may not be profitable, as well as allowing dual-class shares. 

Emtek (EMTK IJ) - Bukalapak Eyeing a SPAC Listing But Jakarta May Be First?

Overseas Chinese Equities, Aequitas Research

Ming Lu

Overseas Chinese Equities

<ul class="">
<li>The new law impacts Alibaba (BABA) and Tencent (700 HK) loan business.</li>
<li>Alibaba (BABA) is strengthening its “community group purchase” of fresh food.</li>
<li>Trip.com (TCOM) was still in stress in 4Q20.</li>
<li>Baidu (BIDU) set up an automobile joint venture.</li>
</ul>


The new law impacts Alibaba (BABA) and Tencent (700 HK) loan business.
Alibaba (BABA) is strengthening its “community group purchase” of fresh food.
Trip.com (TCOM) was still in stress in 4Q20.
Baidu (BIDU) set up an automobile joint venture.


China Internet Weekly (Mar 8): New Law Limits BABA & Tencent’s Loan Biz, BIDU Starts Car Production.

China

NetEase, Inc. operates as an leading internet technology company providing online services including content, community, communication, and commerce. The Company develops and operates online games, electronic commerce, internet media, innovative business, and other businesses. NetEase expands its businesses to Japan, North American, and other other international markets.

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NetEase (9999 HK)

Baidu Secondary Listing: HK-ADS Premium/(Discount) Views

Baidu has launched a $3 bn secondary listing in Hong Kong. Due to choppy market conditions, Baidu pricing its H-shares at a discount range of 3% to...

Arun George

Global Emerging Markets Weekly: 12 March 2021

This insight provides a summary of the key news developments impacting the largest countries and constituents of the Global Emerging Markets equity...

Wium Malan, CFA

Baidu Secondary Listing - Smaller than Expected, Doing the Bare Minimum

Baidu plans to raise around US$3bn in its secondary listing in Hong Kong. I have covered most aspects of the deal in my earlier note. In this note,...

Sumeet Singh

Emtek (EMTK IJ) - Bukalapak Eyeing a SPAC Listing But Jakarta May Be First?

Emtek is an interesting way to play the burgeoning digital economy in Indonesia and would be a key beneficiary should subsidiary Bukalapak choose...

Angus Mackintosh

China Internet Weekly (Mar 8): New Law Limits BABA & Tencent’s Loan Biz, BIDU Starts Car Production.

The new law impacts Alibaba and Tencent loan business. Alibaba is strengthening its “community group purchase” of fresh food. Trip.com was still in...

Ming Lu

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Baidu Secondary Listing: HK-ADS Premium/​(Discount) Views

Baidu has launched a $3 bn secondary listing in Hong Kong. Due to choppy market conditions, Baidu pricing its H-shares at a discount range of 3% to...

Arun George

Global Emerging Markets Weekly: 12 March 2021

This insight provides a summary of the key news developments impacting the largest countries and constituents of the Global Emerging Markets equity...

Wium Malan, CFA

Baidu Secondary Listing - Smaller than Expected, Doing the Bare Minimum

Baidu plans to raise around US$3bn in its secondary listing in Hong Kong. I have covered most aspects of the deal in my earlier note. In this note,...

Sumeet Singh

Emtek (EMTK IJ) - Bukalapak Eyeing a SPAC Listing But Jakarta May Be First?

Emtek is an interesting way to play the burgeoning digital economy in Indonesia and would be a key beneficiary should subsidiary Bukalapak choose...

Angus Mackintosh

China Internet Weekly (Mar 8): New Law Limits BABA & Tencent’s Loan Biz, BIDU Starts Car Production.

The new law impacts Alibaba and Tencent loan business. Alibaba is strengthening its “community group purchase” of fresh food. Trip.com was still in...

Ming Lu

Baidu Secondary Listing: HK-ADS Premium/(Discount) Views