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

Angelalign Technology  / Equity Capital Markets

<p><a href="https://www.smartkarma.com/entities/angelalign-technology-inc" target="_blank" data-smartkarma-citation="entities:31480:1" rel="noopener">Angelalign Technology (AAT HK)</a> is a leading clear aligner treatment solution provider in China. It is the second-largest player accounting for 41.0% market share in 2020 as measured by case shipments, according to CIC. </p><p>At the proposed IPO price range of HK$147-173 per share, Angelalign will have a market cap of HK$24.4-28.7 million ($3.1-3.7 billion). At the mid-point of the IPO price range, the gross proceeds are $347 million.</p><p>In <a href="https://www.smartkarma.com/insights/angelalign-ipo-initiation-if-tooth-be-told" target="_blank" data-smartkarma-citation="insights:51881" rel="noopener">Angelalign IPO Initiation: If Tooth Be Told</a>, we stated that Angelalign is ideally positioned to benefit from China's clear aligner market opportunity due to its high market share, strong growth, rising margins and prodigious cash generation. We concluded that Angelalign is worth a look.</p><div class="content-highlight"><p>On a relative valuation basis, Angelalign looks attractive to its peers on a PEG basis but expensive on a P/E basis. Our base-case DCF value is HK$171.83 per share which is a 7% upside to the mid-point of the IPO price range. Due to the limited upside to our DCF valuation, we think that the IPO price range is full. Overall, while we like Angelalign's fundamentals, due to the full IPO price range and the current weak market sentiment on IPOs, we are inclined to wait on the sidelines for a more attractive entry point.   </p></div>

Angelalign Technology (AAT HK) is a leading clear aligner treatment solution provider in China. It is the second-largest player accounting for 41.0% market share in 2020 as measured by case shipments, according to CIC. At the proposed IPO price range of HK$147-173 per share, Angelalign will have a market cap of HK$24.4-28.7 million ($3.1-3.7 billion). At the mid-point of the IPO price range, the gross proceeds are $347 million.In Angelalign IPO Initiation: If Tooth Be Told, we stated that Angelalign is ideally positioned to benefit from China's clear aligner market opportunity due to its high market share, strong growth, rising margins and prodigious cash generation. We concluded that Angelalign is worth a look.On a relative valuation basis, Angelalign looks attractive to its peers on a PEG basis but expensive on a P/E basis. Our base-case DCF value is HK$171.83 per share which is a 7% upside to the mid-point of the IPO price range. Due to the limited upside to our DCF valuation, we think that the IPO price range is full. Overall, while we like Angelalign's fundamentals, due to the full IPO price range and the current weak market sentiment on IPOs, we are inclined to wait on the sidelines for a more attractive entry point.   

Global Special Situations & Strategy, SR Services Ltd

David Lepper

Global Special Situations & Strategy

SR Services Ltd

SR Services provides Strategic Knowledge and Solutions services for Family Offices and Corporate Business. 

We deliver this via advisory services, strategic planning, opportunity analysis/sourcing, as well as solution implementation. 

Whilst, we create intellectual discipline and operational leverage for your projects or daily activities, our ultimate objective is to empower whilst enhancing your decision making. 

Strategic Knowledge and Solutions

Cross Asset Strategy

<p>Our screen looks for high valuation multiples presented by companies with significant earnings growth forecasts, as well as financial indicators that suggest balance sheet stress. 34 stocks appear in our Q2 2021 screen, versus 25 in Q1 2021 and 15 in Q4 2020. Our Q2 2021 screen shows a reduction in average stock rank to 65.18 from 70.8 points compared to the Q1 2020 screen, placing the stocks lower into the second quartile of the market and showing a deterioration in fundamental and technical aspects. Whilst this is a 7.6% decline, we see this data as tainted by trailing fundamentals. As we highlighted in previous commentaries, we expect the market to see a defined separation of Quality, Value and Relative Momentum over the next few quarters. The erosion is not unexpected as we see a wave of updated forecasts.</p>

Our screen looks for high valuation multiples presented by companies with significant earnings growth forecasts, as well as financial indicators that suggest balance sheet stress. 34 stocks appear in our Q2 2021 screen, versus 25 in Q1 2021 and 15 in Q4 2020. Our Q2 2021 screen shows a reduction in average stock rank to 65.18 from 70.8 points compared to the Q1 2020 screen, placing the stocks lower into the second quartile of the market and showing a deterioration in fundamental and technical aspects. Whilst this is a 7.6% decline, we see this data as tainted by trailing fundamentals. As we highlighted in previous commentaries, we expect the market to see a defined separation of Quality, Value and Relative Momentum over the next few quarters. The erosion is not unexpected as we see a wave of updated forecasts.

Screening the Silk Road: Q2 2021 High Risk Names to Avoid

<div><div id="ember3974"><div>
<div>
<a href="https://www.smartkarma.com/entities/angelalign-technology-inc" target="_blank" data-smartkarma-citation="entities:31480:1" rel="noopener">Angelalign Technology (AAT HK)</a> is a leading clear aligner treatment solution provider in China. It is the second-largest player accounting for 41.0% market share in 2020 as measured by case shipments, according to CIC. Angelalign is pre-marketing an HKEx IPO to raise $300 million, according to press reports. </div>
<div></div>
</div></div></div><div><div><div class="content-highlight"><p>In <a href="https://www.smartkarma.com/insights/angelalign-ipo-initiation-if-tooth-be-told" target="_blank" data-smartkarma-citation="insights:51881" rel="noopener">Angelalign IPO Initiation: If Tooth Be Told</a>, we stated that Angelalign is ideally positioned to benefit from this market opportunity due to high market share, strong growth, rising margins and prodigious cash generation. We concluded that Angelalign is worth a look. In this note, we present our forecasts and take the first look at Angelalign's potential valuation range. </p></div></div></div>



Angelalign Technology (AAT HK) is a leading clear aligner treatment solution provider in China. It is the second-largest player accounting for 41.0% market share in 2020 as measured by case shipments, according to CIC. Angelalign is pre-marketing an HKEx IPO to raise $300 million, according to press reports. 

In Angelalign IPO Initiation: If Tooth Be Told, we stated that Angelalign is ideally positioned to benefit from this market opportunity due to high market share, strong growth, rising margins and prodigious cash generation. We concluded that Angelalign is worth a look. In this note, we present our forecasts and take the first look at Angelalign's potential valuation range. 

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Bottom-Up

Amorepacific Corporation / Equity Bottom-Up

<p>It has been more than a year that it has been discussed in the Korean media about a potential visit of Xi Jinping to South Korea. Due to concerns about COVID-19 and other political factors, Xi Jinping's visit to South Korea has continued to get delayed. Xi Jinping's visit to South Korea is very important since it signifies that there could be much improved measures to increase trade and business opportunities between the two countries. His visit could also lead to the Chinese government opening up measures to allow greater travel measures for the people in China to visit South Korea. </p><p><strong>When will Xi Jinping Visit South Korea? </strong>Although the exact time period of when Xi Jinping could visit South Korea is uncertain, late August/early September could be a probable time when he could visit South Korea. This would be about four months from now which would provide more time for the South Korean government to reduce the daily new cases of COVID-19. It is also probably likely that some investors are already buying shares of these stocks ahead of the actual official announcement of a potential visit of South Korea by Xi Jinping.</p>

It has been more than a year that it has been discussed in the Korean media about a potential visit of Xi Jinping to South Korea. Due to concerns about COVID-19 and other political factors, Xi Jinping's visit to South Korea has continued to get delayed. Xi Jinping's visit to South Korea is very important since it signifies that there could be much improved measures to increase trade and business opportunities between the two countries. His visit could also lead to the Chinese government opening up measures to allow greater travel measures for the people in China to visit South Korea. When will Xi Jinping Visit South Korea? Although the exact time period of when Xi Jinping could visit South Korea is uncertain, late August/early September could be a probable time when he could visit South Korea. This would be about four months from now which would provide more time for the South Korean government to reduce the daily new cases of COVID-19. It is also probably likely that some investors are already buying shares of these stocks ahead of the actual official announcement of a potential visit of South Korea by Xi Jinping.

Xi Jinping's Visit to South Korea: A Trading Strategy for Korean Cosmetics & Consumer Stocks

<p>Whilst Q4's list posted strong price performance it was a case that a rising tide floated most boats. As in the previous few quarters, we are on the watch for the risk of deteriorating credit metrics, but in particular during H1 2021. In Q1, the Altman Z score is at a market-cap-weighted 1.03 times, a significant decrease on the 1.52 in Q4. This deterioration needs to be monitored since earnings continue to be adjusted by analysts and their limited visibility of any bottoming. 25 stocks appear in our Q1 2021 screen, versus 15 in Q4 2020.</p>

Whilst Q4's list posted strong price performance it was a case that a rising tide floated most boats. As in the previous few quarters, we are on the watch for the risk of deteriorating credit metrics, but in particular during H1 2021. In Q1, the Altman Z score is at a market-cap-weighted 1.03 times, a significant decrease on the 1.52 in Q4. This deterioration needs to be monitored since earnings continue to be adjusted by analysts and their limited visibility of any bottoming. 25 stocks appear in our Q1 2021 screen, versus 15 in Q4 2020.

Screening the Silk Road: Q1 2021 High Risk Names to Avoid

South Korea

Osstem Implant Co., Ltd. manufactures dental implant system. The Company also markets dental management software. Osstem Implant provides products for dental surgery and exports abroad.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Osstem Implant (048260 KS)

Angelalign IPO: Valuation Insights

While we like Angelalign's fundamentals, due to the full IPO price range and the current weak market sentiment on IPOs, we are inclined to wait on...

Arun George

Screening the Silk Road: Q2 2021 High Risk Names to Avoid

34 stocks in our Q2'21 HIGH-RISK screen, vs Q1 2021 's 25. Q2'21 shows a reduction in avg stock rank to 65.2 from 70.8 pts in Q1 2020....

David Lepper

Angelalign IPO: Valuation First-Look

Angelalign is pre-marketing an HKEx IPO to raise $300 million, according to press reports. In this note, we present our forecasts and take the...

Arun George

Xi Jinping's Visit to South Korea: A Trading Strategy for Korean Cosmetics & Consumer Stocks

In this insight, we discuss the increasing probability of Xi Jinping visiting South Korea in August/September. This could be a key catalyst for...

Douglas Kim

Screening the Silk Road: Q1 2021 High Risk Names to Avoid

As in the previous few quarters, we are on the watch for the risk of deteriorating credit metrics, but in particular during H1 2021. 25 stocks...

David Lepper

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)