Independent Research, US Dominant Players, Investment Talk

Investment Talk

Independent Research, US Dominant Players

Investment Talk is for readers who wish to learn about companies that are potentially outside of their own circle of research, as well as those who are longing to become part of a community of like-minded investors and learn more about investment research. I would describe myself as a long-term investor who typically takes a 3Y to 5Y outlook, before reassessing once that period matures. I follow the adage that one should research, reach a conclusion, and then verify and continue to hold so long as the thesis remains intact. My own investing style is one that seeks to find dominant players within their respective market who have shown signs of monopoly or oligopolistic behaviour, unlikely to be disrupted, in tandem with discovering market disruptors who have a high likelihood of disrupting their respective market. Equally (and weighted accordingly) I seek to discover more nuanced, misunderstood, situations with a shorter time frame.

Thematic (Sector/Industry)

<ul><li>Beanie Babies, Tamagotchis, fidget spinners, heelys, silly bandz, pogs, pet rocks, mood rings, cabbage patch kids…</li><li>Every generation has its share of fad products, fashion statements, and hairstyles.</li><li>But what separates a fad from a sustainable trend? Understanding the difference between the two can be challenging.</li></ul>

Beanie Babies, Tamagotchis, fidget spinners, heelys, silly bandz, pogs, pet rocks, mood rings, cabbage patch kids…Every generation has its share of fad products, fashion statements, and hairstyles.But what separates a fad from a sustainable trend? Understanding the difference between the two can be challenging.

HK/China Equity Long-Short

Osbert Tang, CFA

Equity Capital Markets

SHEIN Global Holdings / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/shein-global-holdings-limited" target="_blank" data-smartkarma-citation="entities:55372:1" rel="noopener">SHEIN Global Holdings (625 HK)</a> has an ambitious IPO plan to raise HK$13.1bn. However, the volatile earnings record and challenging environment require a sizeable safety margin.</li>
<li>We project a 3-year EPS CAGR of -5.3% as profitability will only slightly recover next year. Yet, our forecasts may still be optimistic.</li>
<li>The maximum IPO price (HK$49.50) implies a FY16 PER of 18.5x, but its small size and volatile growth are negatives. We will only be involved at the low end.</li>
</ul>



SHEIN Global Holdings (625 HK) has an ambitious IPO plan to raise HK$13.1bn. However, the volatile earnings record and challenging environment require a sizeable safety margin.
We project a 3-year EPS CAGR of -5.3% as profitability will only slightly recover next year. Yet, our forecasts may still be optimistic.
The maximum IPO price (HK$49.50) implies a FY16 PER of 18.5x, but its small size and volatile growth are negatives. We will only be involved at the low end.


SHEIN Global (625 HK) IPO: Cheap for Some Reason

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.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/shein-global-holdings-limited" target="_blank" data-smartkarma-citation="entities:55372:1" rel="noopener">SHEIN Global Holdings (625 HK)</a>, a global online fashion and lifestyle company, aims to raise up to US$1.8bn in its Hong Kong listing.</li>
<li>Shein is a global online fashion and lifestyle company serving approximately 273m active customers in approximately 160 markets in 2025.</li>
<li>We have looked at the company’s past performance and provided our thoughts on valuations in our previous notes. In this note, we talk about the IPO pricing.</li>
</ul>



SHEIN Global Holdings (625 HK), a global online fashion and lifestyle company, aims to raise up to US$1.8bn in its Hong Kong listing.
Shein is a global online fashion and lifestyle company serving approximately 273m active customers in approximately 160 markets in 2025.
We have looked at the company’s past performance and provided our thoughts on valuations in our previous notes. In this note, we talk about the IPO pricing.


Aequitas: Shein Global Holdings IPO - Thoughts on Valuation- Just like Its Wares, It Is Cheap But...

Global Healthcare Analyst

Tina Banerjee

<ul>
<li>Shein Global launched Hongkong IPO to raise nearly HK$13.9B. They are a global online fashion and lifestyle company.</li>
<li>Shein Global intends to use the proceeds for technology upgradation, enhance brand awareness, promote corporate responsibility (compliance, governance, climate initiatives etc) and for general corporate purpose.</li>
<li>Valuation seems reasonable. The operational scale, technological infrastructure and supply chain efficiency does make this issue worth a try for investors.</li>
</ul>


Shein Global launched Hongkong IPO to raise nearly HK$13.9B. They are a global online fashion and lifestyle company.
Shein Global intends to use the proceeds for technology upgradation, enhance brand awareness, promote corporate responsibility (compliance, governance, climate initiatives etc) and for general corporate purpose.
Valuation seems reasonable. The operational scale, technological infrastructure and supply chain efficiency does make this issue worth a try for investors.


Shein Global Holdings IPO: Fashionable Enough For Investors

Equity Long-Short Analyst

Pyari Menon

<ul>
<li>The three companies we write about this week are <a href="https://www.smartkarma.com/entities/raytheon-technologies-corp" target="_blank" data-smartkarma-citation="entities:6453:1" rel="noopener">Raytheon Technologies (RTX US)</a><a href="https://www.smartkarma.com/entities/beiersdorf-ag" target="_blank" data-smartkarma-citation="entities:21588:1" rel="noopener">Beiersdorf AG (BEI GR)</a> and <a href="https://www.smartkarma.com/entities/king-slide-works-co-ltd" target="_blank" data-smartkarma-citation="entities:7130:1" rel="noopener">King Slide Works (2059 TT)</a> 
</li>
<li>For the twenty-six weeks since inception ended 19 May the combined innovation portfolio was +2.5%, versus DJIA-0.9%, S&amp;P500+5.7%, Nasdaq+13.6%, Russell2000 -4.1%, MSCI-ACWI-ETF+6.9%, S&amp;P midcap 400 -2.2%, all in US$ terms</li>
<li>Small-Cap (+4.1%) versus Russell2000 (-4.1%) and midcap (+1.9%) versus S&amp;P400 (-2.2%) continues to outperform benchmarks, but the omission of mega-tech names has hurt large-cap portfolio (+2.6%) versus S&amp;P500 (+5.7%) . </li>
</ul>


The three companies we write about this week are Raytheon Technologies (RTX US)Beiersdorf AG (BEI GR) and King Slide Works (2059 TT) 

For the twenty-six weeks since inception ended 19 May the combined innovation portfolio was +2.5%, versus DJIA-0.9%, S&amp;P500+5.7%, Nasdaq+13.6%, Russell2000 -4.1%, MSCI-ACWI-ETF+6.9%, S&amp;P midcap 400 -2.2%, all in US$ terms
Small-Cap (+4.1%) versus Russell2000 (-4.1%) and midcap (+1.9%) versus S&amp;P400 (-2.2%) continues to outperform benchmarks, but the omission of mega-tech names has hurt large-cap portfolio (+2.6%) versus S&amp;P500 (+5.7%) . 


The Innovations Portfolios - Week Twenty Six

United States

NIKE, Inc. designs, develops, and markets athletic footwear, apparel, equipment, and accessory products for men, women, and children. The Company sells its products worldwide to retail stores, through its own stores, subsidiaries, and distributors.

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Nike (NKE US)

Fads and Second Acts

Beanie Babies, Tamagotchis, fidget spinners, heelys, silly bandz, pogs, pet rocks, mood rings, cabbage patch kids… Every generation has its share...

Investment Talk

SHEIN Global (625 HK) IPO: Cheap for Some Reason

SHEIN's plan to raise HK$13.1bn is aggressive, as the 3-year EPS CAGR will only be -5.3%. We need a sizeable safety margin to cover the risks and...

Osbert Tang, CFA

Aequitas: Shein Global Holdings IPO - Thoughts on Valuation- Just like Its Wares, It Is Cheap But...

SHEIN Global Holdings (625 HK), a global online fashion and lifestyle company, aims to raise up to US$1.8bn in its Hong Kong listing. In this note,...

Sumeet Singh

Shein Global Holdings IPO: Fashionable Enough For Investors

Shein Global launched Hongkong IPO to raise nearly HK$13.9B for technology upgradation, enhance brand awareness. Valuation seems reasonable for...

Tina Banerjee

The Innovations Portfolios - Week Twenty Six

The small-Cap (+4.1%) and midcap (+1.9%) portfolios continues to outperform respective benchmarks, but the willful omission of mega-tech names has...

Pyari Menon

Price Gauge

52-week Range

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