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.

Event-Driven

<ul>
<li>Kakao Pay (KP), one of South Korea’s largest payment and financial services apps, raised US$1.3bn in its South Korean IPO in Nov 21. Its 6 month lock-up will expire soon.</li>
<li>The stock more than doubled on listing, providing one of the best first day returns in 2021. However, its performance since then hasn’t been all that great.</li>
<li>In this note, we will talk about the lock-up dynamics and updates since our last note.</li>
</ul>


Kakao Pay (KP), one of South Korea’s largest payment and financial services apps, raised US$1.3bn in its South Korean IPO in Nov 21. Its 6 month lock-up will expire soon.
The stock more than doubled on listing, providing one of the best first day returns in 2021. However, its performance since then hasn’t been all that great.
In this note, we will talk about the lock-up dynamics and updates since our last note.


Kakao Pay IPO Lock-Up - IPO Was Great, Performance Since Then Has Been Tepid

Equity Analyst, LightStream Research

Shifara Samsudeen, FCMA, CGMA

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Equity Capital Markets

<ul>
<li>Superapp <a href="https://www.smartkarma.com/entities/gojek-goto" target="_blank" data-smartkarma-citation="entities:25976:1" rel="noopener">GoTo (GOTO IJ)</a> made its public debut on the Indonesian Stock Exchange on 11th April. The company set the final IPO price at IDR338 per share.  </li>
<li>GoTo’s shares surged nearly 23% to IDR416 a piece on the open, boosting the company’s market cap to more than IDR497trn.</li>
<li>GoTo's share price has continued to slide and our SOTP valuation suggests that there is further downside.</li>
</ul>


Superapp GoTo (GOTO IJ) made its public debut on the Indonesian Stock Exchange on 11th April. The company set the final IPO price at IDR338 per share.  
GoTo’s shares surged nearly 23% to IDR416 a piece on the open, boosting the company’s market cap to more than IDR497trn.
GoTo's share price has continued to slide and our SOTP valuation suggests that there is further downside.


GoTo IPO: Shares Are Still Overvalued and There Is Further Downside

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.

<ul>
<li>In response to an <a href="https://www.afr.com/street-talk/bain-capital-checks-out-eml-payments-bankers-chase-other-buyers-20220412-p5acvc" target="_blank" rel="noopener">AFR article</a>, <a href="https://www.smartkarma.com/entities/eml-payments-limited" target="_blank" data-smartkarma-citation="entities:3232:1" rel="noopener">EML Payments Limited (EML AU)</a> confirmed takeover interest from Bain Capital. However, discussions have ceased. The shares closed 10.5% higher at A$2.94. </li>
<li>The bombed-out share prices of payment companies have supported recent M&amp;A activity such as <a href="https://www.smartkarma.com/entities/afterpay-holdings-ltd" target="_blank" data-smartkarma-citation="entities:24047:1" rel="noopener">Afterpay Holdings (AFY AU)</a>/<a href="https://www.smartkarma.com/entities/square-inc" target="_blank" data-smartkarma-citation="entities:23755:1" rel="noopener">Square Inc (SQ US)</a> and <a href="https://www.smartkarma.com/entities/sezzle-inc" target="_blank" data-smartkarma-citation="entities:30969:1" rel="noopener">Sezzle Inc (SZL AU)</a>/<a href="https://www.smartkarma.com/entities/zip-co-ltd-3708706d-4978-4e29-acbc-d9702b971da9" target="_blank" data-smartkarma-citation="entities:29126:1" rel="noopener">Zip Co Ltd (Z1P AU)</a>.</li>
<li>Despite today’s pop, the shares are still 50% down over the last 12 months. EML’s market positioning and expected stronger 2HFY22 should continue to fuel takeover interest.</li>
</ul>


In response to an AFR article, EML Payments Limited (EML AU) confirmed takeover interest from Bain Capital. However, discussions have ceased. The shares closed 10.5% higher at A$2.94. 
The bombed-out share prices of payment companies have supported recent M&amp;A activity such as Afterpay Holdings (AFY AU)/Square Inc (SQ US) and Sezzle Inc (SZL AU)/Zip Co Ltd (Z1P AU).
Despite today’s pop, the shares are still 50% down over the last 12 months. EML’s market positioning and expected stronger 2HFY22 should continue to fuel takeover interest.


EML Payments Flirtation with Bain Likely Not the Last

<ul>
<li>Superapp <a href="https://www.smartkarma.com/entities/gojek-goto" target="_blank" data-smartkarma-citation="entities:25976:1" rel="noopener">GoTo (1379371D IJ)</a> has filed for an IPO to list its shares on the Indonesian Stock Exchange to raise US$1.1-1.25bn at a valuation of about US$24-26bn.</li>
<li>The company plans to use the proceeds to develop its business including for customer acquisition, product development and sales and marketing.</li>
<li>Our SOTP valuation implies that GoTo’s shares are overvalued at the indicative IPO price range.</li>
</ul>


Superapp GoTo (1379371D IJ) has filed for an IPO to list its shares on the Indonesian Stock Exchange to raise US$1.1-1.25bn at a valuation of about US$24-26bn.
The company plans to use the proceeds to develop its business including for customer acquisition, product development and sales and marketing.
Our SOTP valuation implies that GoTo’s shares are overvalued at the indicative IPO price range.


Covering IPOs, Healthcare and Technology Stocks

Andrei Zakharov

Algosun Global

Equity Bottom-Up

<ul>
<li>We see limited upside potential for <a href="https://www.smartkarma.com/entities/upstart-holdings-inc" target="_blank" data-smartkarma-citation="entities:29727:1" rel="noopener">Upstart Holdings Inc (UPST US)</a>  shares after reporting a record 200%+ YoY revenue growth rate in CY’21.   </li>
<li>Our calculations suggest insiders sold ~$1.5 billion worth of Upstart shares since August 2020, including Third Point, CEO of Upstart Holdings, and management of the fintech company. </li>
<li>Rising interest rates and tightening of credit markets may negatively impact revenue, keeping in mind that <a href="https://www.smartkarma.com/entities/upstart-holdings-inc" target="_blank" data-smartkarma-citation="entities:29727:1" rel="noopener">Upstart Holdings Inc (UPST US)</a>  primarily facilitates unsecured personal loans on the platform.</li>
</ul>


We see limited upside potential for Upstart Holdings Inc (UPST US)  shares after reporting a record 200%+ YoY revenue growth rate in CY’21.   
Our calculations suggest insiders sold ~$1.5 billion worth of Upstart shares since August 2020, including Third Point, CEO of Upstart Holdings, and management of the fintech company. 
Rising interest rates and tightening of credit markets may negatively impact revenue, keeping in mind that Upstart Holdings Inc (UPST US)  primarily facilitates unsecured personal loans on the platform.


Upstart Holdings: Slowdown In Revenue Growth And Tightening Of Credit Markets

United States

PayPal Holdings, Inc. operates as a technology platform company that enables digital and mobile payments on behalf of consumers and merchants. The Company offers online payment solutions. PayPal Holdings serves customers worldwide.

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Paypal Holdings (PYPL US)

Kakao Pay IPO Lock-Up - IPO Was Great, Performance Since Then Has Been Tepid

Kakao Pay (KP), one of South Korea’s largest payment and financial services apps, raised US$1.3bn in its South Korean IPO in Nov 21. Its 6 month...

Sumeet Singh

GoTo IPO: Shares Are Still Overvalued and There Is Further Downside

GoTo’s shares surged nearly 23% to IDR416 a piece on the open, however, share price has continued to slide and our SOTP valuation suggests that...

Shifara Samsudeen, FCMA, CGMA

EML Payments Flirtation with Bain Likely Not the Last

EML confirmed takeover interest from Bain Capital but discussions have ceased. EML’s market positioning and expected stronger 2HFY22 should...

Arun George

GoTo IPO: Peer Comparison and Valuation

Even without conservative assumptions, our SOTP valuation implies that GoTo’s shares are overvalued at the indicative IPO price range.

Shifara Samsudeen, FCMA, CGMA

Upstart Holdings: Slowdown In Revenue Growth And Tightening Of Credit Markets

We think investors should be cautious on Upstart shares due to the slowdown in revenue growth rates and the tightening of credit markets

Andrei Zakharov

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