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.

Equity Capital Markets

Lionheart Studio  / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/lionheart-studio-corporation" target="_blank" data-smartkarma-citation="entities:36417:1" rel="noopener">Lionheart Studio (426630 KS)</a>, a game development studio based in South Korea,  aims to raise around US$420m via its South Korean IPO.</li>
<li>The company is majority owned by <a href="https://www.smartkarma.com/entities/kakao-games-corp" target="_blank" data-smartkarma-citation="entities:26730:1" rel="noopener">Kakao Games Corp (293490 KS)</a>, which after having recently hiked its stake, owned 54.94% of the company prior to listing.  </li>
<li>In this note, we will talk about the positive aspects of the deal.</li>
</ul>



Lionheart Studio (426630 KS), a game development studio based in South Korea,  aims to raise around US$420m via its South Korean IPO.
The company is majority owned by Kakao Games Corp (293490 KS), which after having recently hiked its stake, owned 54.94% of the company prior to listing.  
In this note, we will talk about the positive aspects of the deal.


Lion Heart Studio Pre-IPO - The Positives - Got One Hit

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

<ul>
<li>Our base case valuation of Lionheart Studio is a target price of 19,362 won per share, which is 46% lower than the low end of the IPO price range.</li>
<li>Our IPO valuation assumes a 7.2x EV/EBITDA (comps' average) using 2023 estimated EBITDA of 145 billion won for the company.</li>
<li>All in all, we believe there is a strong probability of Lionheart Studio being forced to lower its IPO price range in order to attract more investors. </li>
</ul>


Our base case valuation of Lionheart Studio is a target price of 19,362 won per share, which is 46% lower than the low end of the IPO price range.
Our IPO valuation assumes a 7.2x EV/EBITDA (comps' average) using 2023 estimated EBITDA of 145 billion won for the company.
All in all, we believe there is a strong probability of Lionheart Studio being forced to lower its IPO price range in order to attract more investors. 


Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Index Rebalance

<ul>
<li>The KRX announced the changes to the KRX New Deal indices post market close on Friday. But the changes were not made public and are only available to subscribers.</li>
<li>
<a href="https://www.smartkarma.com/entities/intellian-technologies-inc" target="_blank" data-smartkarma-citation="entities:34895:1" rel="noopener">Intellian Technologies (189300)</a> and <a href="https://www.smartkarma.com/entities/seojin-system-co-ltd" target="_blank" data-smartkarma-citation="entities:24032:1" rel="noopener">Seojin System (178320)</a> replace <a href="https://www.smartkarma.com/entities/danal-co-ltd" target="_blank" data-smartkarma-citation="entities:19682:1" rel="noopener">Danal (064260)</a> and <a href="https://www.smartkarma.com/entities/kcp-co-ltd" target="_blank" data-smartkarma-citation="entities:16045:1" rel="noopener">Kcp (060250)</a> in the Internet Index, while <a href="https://www.smartkarma.com/entities/kmw-co-ltd" target="_blank" data-smartkarma-citation="entities:2834:1" rel="noopener">KMW Co Ltd (032500 KS)</a> replaces <a href="https://www.smartkarma.com/entities/afreecatv-co-ltd" target="_blank" data-smartkarma-citation="entities:20163:1" rel="noopener">AfreecaTV (067160 KS)</a> in BBIG.</li>
<li>Since we published our last forecast on 21 July, <a href="https://www.smartkarma.com/entities/kmw-co-ltd" target="_blank" data-smartkarma-citation="entities:2834:1" rel="noopener">KMW Co Ltd (032500 KS)</a> is up 12% while <a href="https://www.smartkarma.com/entities/afreecatv-co-ltd" target="_blank" data-smartkarma-citation="entities:20163:1" rel="noopener">AfreecaTV (067160 KS)</a> has dropped 17%.</li>
</ul>


The KRX announced the changes to the KRX New Deal indices post market close on Friday. But the changes were not made public and are only available to subscribers.

Intellian Technologies (189300) and Seojin System (178320) replace Danal (064260) and Kcp (060250) in the Internet Index, while KMW Co Ltd (032500 KS) replaces AfreecaTV (067160 KS) in BBIG.
Since we published our last forecast on 21 July, KMW Co Ltd (032500 KS) is up 12% while AfreecaTV (067160 KS) has dropped 17%.


KRX New Deal Index Rebalance: All Forecasts Right as KMW Soars and AfreecaTV Drops

<ul>
<li>The review period for the September rebalance of the KRX New Deal indices started on 1 May and will run till 29 July. Implementation is on 8 September.</li>
<li>
<a href="https://www.smartkarma.com/entities/intellian-technologies-inc" target="_blank" data-smartkarma-citation="entities:34895:1" rel="noopener">Intellian Technologies (189300 KS)</a> and <a href="https://www.smartkarma.com/entities/seojin-system-co-ltd" target="_blank" data-smartkarma-citation="entities:24032:1" rel="noopener">Seojin System Co, Ltd. (178320 KS)</a> could replace <a href="https://www.smartkarma.com/entities/danal-co-ltd" target="_blank" data-smartkarma-citation="entities:19682:1" rel="noopener">Danal Co Ltd (064260 KS)</a> and <a href="https://www.smartkarma.com/entities/kcp-co-ltd" target="_blank" data-smartkarma-citation="entities:16045:1" rel="noopener">Kcp Co Ltd (060250 KS)</a> in the Internet Index.</li>
<li>
<a href="https://www.smartkarma.com/entities/nexon-games-co-ltd" target="_blank" data-smartkarma-citation="entities:35967:1" rel="noopener">Nexon Games (225570 KS)</a> could replace <a href="https://www.smartkarma.com/entities/devsisters-co-ltd" target="_blank" data-smartkarma-citation="entities:14096:1" rel="noopener">Devsisters (194480 KS)</a> in the Game Index, and <a href="https://www.smartkarma.com/entities/kmw-co-ltd" target="_blank" data-smartkarma-citation="entities:2834:1" rel="noopener">KMW Co Ltd (032500 KS)</a> could replace <a href="https://www.smartkarma.com/entities/afreecatv-co-ltd" target="_blank" data-smartkarma-citation="entities:20163:1" rel="noopener">AfreecaTV (067160 KS)</a> in the BBIG Index.</li>
</ul>


The review period for the September rebalance of the KRX New Deal indices started on 1 May and will run till 29 July. Implementation is on 8 September.

Intellian Technologies (189300 KS) and Seojin System Co, Ltd. (178320 KS) could replace Danal Co Ltd (064260 KS) and Kcp Co Ltd (060250 KS) in the Internet Index.

Nexon Games (225570 KS) could replace Devsisters (194480 KS) in the Game Index, and KMW Co Ltd (032500 KS) could replace AfreecaTV (067160 KS) in the BBIG Index.


KRX New Deal Index Rebalance Preview: KMW Into BBIG to Drive Flows

<ul>
<li>Lionheart Studio Corp, which is one of the fastest growing game making companies in Korea, is getting ready to complete its IPO as early as 2H 2022. </li>
<li>Lionheart Studio is best known for its popular mobile game Odin which ranked first in app market sales right after its launch in June of last year.</li>
<li>Kakao Games' share price could fall further as some investors that are enthusiastic about Odin would rather invest invest in Lionheart Studio directly rather than in Kakao Games.</li>
</ul>


Lionheart Studio Corp, which is one of the fastest growing game making companies in Korea, is getting ready to complete its IPO as early as 2H 2022. 
Lionheart Studio is best known for its popular mobile game Odin which ranked first in app market sales right after its launch in June of last year.
Kakao Games' share price could fall further as some investors that are enthusiastic about Odin would rather invest invest in Lionheart Studio directly rather than in Kakao Games.


Lionheart Studio Getting Ready for an IPO as Early as 2H 2022: A Near-Term Negative for Kakao Games

South Korea

Pearl Abyss Corp. operates as a computer games making company. The Company offers games development, games exporting, and other services. Pearl Abyss serves customers worldwide.

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Pearl Abyss (263750 KS)

Lion Heart Studio Pre-IPO - The Positives - Got One Hit

Lionheart Studio, a game development studio based in South Korea, aims to raise around US$420m via its South Korean IPO. The company is majority...

Sumeet Singh

Lionheart Studio IPO Valuation Analysis

Our base case valuation of Lionheart Studio is a target price of 19,362 won per share, which is 46% lower than the low end of the IPO price range.

Douglas Kim

KRX New Deal Index Rebalance: All Forecasts Right as KMW Soars and AfreecaTV Drops

There is one change to the Game & BBIG index and two changes to the Internet index. KMW has the largest passive inflow and impact while AfreecaTV...

Brian Freitas

KRX New Deal Index Rebalance Preview: KMW Into BBIG to Drive Flows

We see 2 changes for the Internet Index and 1 for the Game Index. More importantly, KMW couple replace AfreecaTV in the BBIG Index and that will...

Brian Freitas

Lionheart Studio Getting Ready for an IPO as Early as 2H 2022: A Near-Term Negative for Kakao Games

Lionheart Studio Corp, which is one of the fastest growing game making companies in Korea, is getting ready to complete its IPO as early as 2H...

Douglas Kim

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