Financials & FinTech research, Galliano’s Financials Research

Victor Galliano

Financials & FinTech research

Financials & FinTech, EM & Developed Markets

Galliano’s Financials Research

Galliano's Financials Research provides fundamental research in Emerging Markets financials, including FinTech, as well as financials in select Developed Markets.

The investment style applied is generally value oriented, although Growth At Reasonable Price (GARP) strategies can also be used where appropriate. 

Our investment research approach aim is often contrarian, looking to capitalise on overly sceptical or optimistic consensus views. In terms of valuation techniques, the focus is on PBV ratio to ROE, PE multiples and dividend yield, as well as the application of PEG ratios and, where appropriate, Sum of the Parts (SOTP) valuations.

Equity Capital Markets

<ul>
<li>Rakuten Bank’s IPO will add an attractively valued Japanese neobank to the globally listed neobank universe; furthermore, the Rakuten Group ecosystem is a powerful tool for customer acquisition and retention</li>
<li>On efficiency metrics, Rakuten Bank scores well versus its key domestic peers as well as global comparables; Rakuten Group companies act as a key conduit for new clients</li>
<li>At the announced issue price of ¥1,400, Rakuten Bank’s PBV ratio implies an attractive 25% discount to its core Japanese peer SBI Sumishin Net Bank, for similar ROE</li>
</ul>


Rakuten Bank’s IPO will add an attractively valued Japanese neobank to the globally listed neobank universe; furthermore, the Rakuten Group ecosystem is a powerful tool for customer acquisition and retention
On efficiency metrics, Rakuten Bank scores well versus its key domestic peers as well as global comparables; Rakuten Group companies act as a key conduit for new clients
At the announced issue price of ¥1,400, Rakuten Bank’s PBV ratio implies an attractive 25% discount to its core Japanese peer SBI Sumishin Net Bank, for similar ROE


Rakuten Bank (5838 JP) – A Keenly Priced Quality Addition to the Global Neobanks Universe

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.

SBI Sumishin Net Bank  / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/sbi-sumishin-net-bank" target="_blank" data-smartkarma-citation="entities:34572:1" rel="noopener">SBI Sumishin Net Bank (7163 JP)</a> (SSNB) is looking to raise around US$390m in its second listing attempt.</li>
<li>SBI Sumishin Net Bank is a Japanese digital bank set up as a 50-50 joint venture between Sumitomo Mitsui Trust Bank, Japan’s largest trust bank, and SBI Group.</li>
<li>In this note, we talk about implied valuations in the IPO price range</li>
</ul>



SBI Sumishin Net Bank (7163 JP) (SSNB) is looking to raise around US$390m in its second listing attempt.
SBI Sumishin Net Bank is a Japanese digital bank set up as a 50-50 joint venture between Sumitomo Mitsui Trust Bank, Japan’s largest trust bank, and SBI Group.
In this note, we talk about implied valuations in the IPO price range


SBI Sumishin Net Bank IPO - It Was All Good, till Friday

<ul>
<li>
<a href="https://www.smartkarma.com/entities/sbi-sumishin-net-bank" target="_blank" data-smartkarma-citation="entities:34572:1" rel="noopener">SBI Sumishin Net Bank (7163 JP)</a> (SSNB) is now looking to raise around US$380m in its second listing attempt.</li>
<li>SBI Sumishin Net Bank is a Japanese digital bank set up as a 50-50 joint venture between Sumitomo Mitsui Trust Bank, Japan’s largest trust bank, and SBI Group.</li>
<li>In this note, we talk about our updated earnigns forecast and thoughts on valuations</li>
</ul>



SBI Sumishin Net Bank (7163 JP) (SSNB) is now looking to raise around US$380m in its second listing attempt.
SBI Sumishin Net Bank is a Japanese digital bank set up as a 50-50 joint venture between Sumitomo Mitsui Trust Bank, Japan’s largest trust bank, and SBI Group.
In this note, we talk about our updated earnigns forecast and thoughts on valuations


SBI Sumishin Net Bank Pre-IPO - Revised Forecast and Valuations - RoA or RoE?

Equity Bottom-Up

Grupo Financiero Banorte SAB d / Equity Bottom-Up

Grupo Financiero Banorte SAB d (GFNORTEO MF)

<ul>
<li>We explore Citibank’s upcoming Banamex disposal, which appears to have become a one horse race and question whether an IPO is completely off the cards</li>
<li>Bank sector data trends to December remain robust, but headwinds are building; rising funding costs threaten credit spreads and worsening cost of credit trends, both set to erode 2023 returns</li>
<li>BBVA Mexico generates consistent premium ROE of 25%+, investors can gain exposure through parent BBVA shares; we remain cautious on Banorte, due to the growing risks to returns and valuation</li>
</ul>


We explore Citibank’s upcoming Banamex disposal, which appears to have become a one horse race and question whether an IPO is completely off the cards
Bank sector data trends to December remain robust, but headwinds are building; rising funding costs threaten credit spreads and worsening cost of credit trends, both set to erode 2023 returns
BBVA Mexico generates consistent premium ROE of 25%+, investors can gain exposure through parent BBVA shares; we remain cautious on Banorte, due to the growing risks to returns and valuation


Banamex Update & Mexican Banks’ December Data; Risks of Credit Spread Erosion & Rising Credit Costs

<ul>
<li>4Q22 results confirm that Nubank is the benchmark among EM neobanks in terms of activity rates, as well as trends in revenues and costs per client and digital efficiencies</li>
<li>We see further potential for broadening and deepening the product offer to customers, at little incremental cost especially in Brazil, to drive cost effective revenue growth</li>
<li>Our proprietary Nubank model forecasts are broadly in sync with positive consensus estimates; we forecast group ROE of close to 30% in FY 2025, despite high cost of credit assumptions</li>
</ul>


4Q22 results confirm that Nubank is the benchmark among EM neobanks in terms of activity rates, as well as trends in revenues and costs per client and digital efficiencies
We see further potential for broadening and deepening the product offer to customers, at little incremental cost especially in Brazil, to drive cost effective revenue growth
Our proprietary Nubank model forecasts are broadly in sync with positive consensus estimates; we forecast group ROE of close to 30% in FY 2025, despite high cost of credit assumptions


Nubank (NU US); Strong Execution to Drive Premium ROE into 2023 and Beyond

Brazil

Nu Holdings Ltd. is a Brazilian financial technology firm that offers digital banking services, including credit and debit cards, mobile payment solutions, and investment platforms. The company provides spending, transactional, savings, investing, borrowing, and protection solutions for individuals and businesses across Brazil, Mexico, and Colombia. Nu Holdings Ltd. was founded in 2013 and is headquartered in São Paulo, Brazil.

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Nu Holdings (NU US)

Rakuten Bank (5838 JP) – A Keenly Priced Quality Addition to the Global Neobanks Universe

Rakuten Bank's IPO is priced to go; issue price PBV ratio implies an attractive 25% discount to core Japanese peer SBI Sumishin Net Bank, for...

Victor Galliano

SBI Sumishin Net Bank IPO - It Was All Good, till Friday

SBI Sumishin Net Bank (7163 JP) (SSNB) is looking to raise around US$390m in its second listing attempt. In this note, we talk about valuations.

Sumeet Singh

SBI Sumishin Net Bank Pre-IPO - Revised Forecast and Valuations - RoA or RoE?

SBI Sumishin Net Bank (7163 JP) (SSNB) is now looking to raise around US$380m in its second listing attempt. In this note we talk about our revised...

Sumeet Singh

Banamex Update & Mexican Banks’ December Data; Risks of Credit Spread Erosion & Rising Credit Costs

The Banamex sale is a one horse race, Mexican bank PBVs are high; is an IPO totally off the cards? December data was solid, but higher funding...

Victor Galliano

Nubank (NU US); Strong Execution to Drive Premium ROE into 2023 and Beyond

Nubank presented solid 4Q22 results, with high activity rates, growing revenue per customer, controlled costs per customer whilst keeping a sound...

Victor Galliano

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