Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

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<div>
<p>Back on the 9 February, <a href="https://www.smartkarma.com/entities/kerry-logistics-network-ltd" target="_blank" data-smartkarma-citation="entities:367:1" rel="noopener">Kerry Logistics Network (636 HK)</a> (KLN) <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0210/2021021000043.pdf" target="_blank" rel="noopener">announced</a> a pre-conditional Partial Offer from  <a href="https://www.smartkarma.com/entities/maanshan-dingtai-rare-a" target="_blank" data-smartkarma-citation="entities:4128:1" rel="noopener">S.F. Holding (002352 CH)</a> ("SFH").  SFH intended to acquire 931.21mn shares or 51.8% of shares outstanding, of KLN. The Offer price of  HK$18.80/share was a 19.83% discount to last close. KLN's shares also gained 25% prior to the suspension.</p>
<p>Below is a timeline of events that subsequently unfolded:</p>
<div>
<table class="table table-striped">
<tbody>
<tr>
<td style="width: 139.871px;">
<h3>Date</h3>
</td>
<td style="width: 606.141px;">
<h3>Data in the Date</h3>
</td>
</tr>
<tr>
<td style="width: 139.871px;">30-Mar-21</td>
<td style="width: 606.141px;">The controlling shareholders of <a href="https://www.smartkarma.com/entities/kerry-logistics-network-ltd" target="_blank" data-smartkarma-citation="entities:367:1" rel="noopener">Kerry Logistics Network (636 HK)</a> (KLN), including <a href="https://www.smartkarma.com/entities/kerry-properties-ltd" target="_blank" data-smartkarma-citation="entities:3320:1" rel="noopener">Kerry Properties (683 HK)</a>, plus shares held by executive directors, comprise 63.1% of shares out. These shareholders have given an irrevocable to tender 575.545mn shares or 32% of shares out. Those irrevocables have now been <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0330/2021033003206.pdf" target="_blank" rel="noopener">fulfilled</a> - this forms part of the pre-conditions.</td>
</tr>
<tr>
<td style="width: 139.871px;">9-Apr-21</td>
<td style="width: 606.141px;">KLN <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0409/2021040901991.pdf" target="_blank" rel="noopener">announced</a> that the antitrust approval has been received from the State Administration for Market Regulation with respect to the Partial Offer.</td>
</tr>
<tr>
<td style="width: 139.871px;">26-May-21</td>
<td style="width: 606.141px;">At an SGM, KLN shareholders overwhelmingly <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0526/2021052600981.pdf" target="_blank" rel="noopener">approved</a> the sale of its Hong Kong, Taiwan warehouse business to Kerry Holdings.</td>
</tr>
<tr>
<td style="width: 139.871px;">7-Jun-21</td>
<td style="width: 606.141px;">The free float waiver has been <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0607/2021060701185.pdf" target="_blank" rel="noopener">received</a> from the HKEx.</td>
</tr>
<tr>
<td style="width: 139.871px;">15-Jun-21</td>
<td style="width: 606.141px;">
<p>Approval by the shareholders of <a href="https://www.smartkarma.com/entities/kerry-properties-ltd" target="_blank" data-smartkarma-citation="entities:3320:1" rel="noopener">Kerry Properties (683 HK)</a> <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0615/2021061501141.pdf" target="_blank" rel="noopener">obtained</a></p>
</td>
</tr>
<tr>
<td style="width: 139.871px;">29-Jun-21</td>
<td style="width: 606.141px;">CFIUS approval <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0629/2021062900794.pdf" target="_blank" rel="noopener">received</a>
</td>
</tr>
<tr>
<td style="width: 139.871px;">20-Jul-21</td>
<td style="width: 606.141px;">KLN <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0720/2021072000823.pdf" target="_blank" rel="noopener">announced</a> approval by the Independent Shareholders in respect of the Special Deal Agreements and the Framework Services Agreement had been obtained.</td>
</tr>
<tr>
<td style="width: 139.871px;">2-Aug-21</td>
<td style="width: 606.141px;">KLN <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0802/2021080201361.pdf" target="_blank" rel="noopener">announced</a> NDRC and MoC approval has been received as to the partial offer.</td>
</tr>
<tr>
<td style="width: 139.871px;">9-Aug-21</td>
<td style="width: 606.141px;">Exactly on the Long Stop date, KLN <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0809/2021080901151.pdf" target="_blank" rel="noopener">announced</a> all of the pre-cons have been met - or waived (the Thai waiver in particular)  - and that the Composite Document is expected to be dispatched, on or before, the 16 August. </td>
</tr>
<tr>
<td style="width: 139.871px;">12-Aug-21</td>
<td style="width: 606.141px;">Composite Doc <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0811/2021081101136.pdf" target="_blank" rel="noopener">dispatched</a>
</td>
</tr>
<tr>
<td style="width: 139.871px;">17-Aug-21</td>
<td style="width: 606.141px;">The Record Date for the Special Dividend is expected to be the 1 <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0817/2021081701332.pdf" target="_blank" rel="noopener">September</a>. The Special Dividend is expected to be paid on or about Friday, 17 September 2021</td>
</tr>
<tr>
<td style="width: 139.871px;">18-Aug-21</td>
<td style="width: 606.141px;">Irrevocables <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0818/2021081800881.pdf" target="_blank" rel="noopener">received</a>. Thai MGO waiver received,. </td>
</tr>
<tr>
<td colspan="2" style="width: 746.012px;"><em>Source: HKEx announcements</em></td>
</tr>
</tbody>
</table>
</div>
</div>
<p>All appears to be going to plan.  The first close is the 2 September. </p>
<p>Then KLN announced on the 24 August a <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0824/2021082401338.pdf" target="_blank" rel="noopener">delay</a> in the record date for the Special Dividend. KLN estimates:</p>
<blockquote>
<p>that the Record Date for the Special Dividend will be on or around Wednesday, 15 September 2021, instead of Wednesday, 1 September 2021 as disclosed in the Special Dividend Announcement. The Special Dividend is expected to be paid on or about Tuesday, 5 October 2021, instead of Friday, 17 September 2021.</p>
</blockquote>
<p>With the Partial expected to close on the 2 September, questions have been asked whether those shareholders who have already tendered - or those investors who tender before the 2 September - whether they are still eligible for the special dividend?</p>
</div>
<div>
<p>More below the fold. </p>
<p>Plus updated <em><strong>Ye Olde Arb Grids</strong></em>. </p>
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<div></div>
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</div>



Back on the 9 February, Kerry Logistics Network (636 HK) (KLN) announced a pre-conditional Partial Offer from  S.F. Holding (002352 CH) ("SFH").  SFH intended to acquire 931.21mn shares or 51.8% of shares outstanding, of KLN. The Offer price of  HK$18.80/share was a 19.83% discount to last close. KLN's shares also gained 25% prior to the suspension.
Below is a timeline of events that subsequently unfolded:





Date


Data in the Date



30-Mar-21
The controlling shareholders of Kerry Logistics Network (636 HK) (KLN), including Kerry Properties (683 HK), plus shares held by executive directors, comprise 63.1% of shares out. These shareholders have given an irrevocable to tender 575.545mn shares or 32% of shares out. Those irrevocables have now been fulfilled - this forms part of the pre-conditions.


9-Apr-21
KLN announced that the antitrust approval has been received from the State Administration for Market Regulation with respect to the Partial Offer.


26-May-21
At an SGM, KLN shareholders overwhelmingly approved the sale of its Hong Kong, Taiwan warehouse business to Kerry Holdings.


7-Jun-21
The free float waiver has been received from the HKEx.


15-Jun-21

Approval by the shareholders of Kerry Properties (683 HK) obtained



29-Jun-21
CFIUS approval received



20-Jul-21
KLN announced approval by the Independent Shareholders in respect of the Special Deal Agreements and the Framework Services Agreement had been obtained.


2-Aug-21
KLN announced NDRC and MoC approval has been received as to the partial offer.


9-Aug-21
Exactly on the Long Stop date, KLN announced all of the pre-cons have been met - or waived (the Thai waiver in particular)  - and that the Composite Document is expected to be dispatched, on or before, the 16 August. 


12-Aug-21
Composite Doc dispatched



17-Aug-21
The Record Date for the Special Dividend is expected to be the 1 September. The Special Dividend is expected to be paid on or about Friday, 17 September 2021


18-Aug-21
Irrevocables received. Thai MGO waiver received,. 


Source: HKEx announcements





All appears to be going to plan.  The first close is the 2 September. 
Then KLN announced on the 24 August a delay in the record date for the Special Dividend. KLN estimates:

that the Record Date for the Special Dividend will be on or around Wednesday, 15 September 2021, instead of Wednesday, 1 September 2021 as disclosed in the Special Dividend Announcement. The Special Dividend is expected to be paid on or about Tuesday, 5 October 2021, instead of Friday, 17 September 2021.

With the Partial expected to close on the 2 September, questions have been asked whether those shareholders who have already tendered - or those investors who tender before the 2 September - whether they are still eligible for the special dividend?


More below the fold. 
Plus updated Ye Olde Arb Grids. 





Kerry Logistics (636 HK): Technicalities As Partial Draws To An End

<div>
<p><a href="https://www.smartkarma.com/entities/kerry-logistics-network-ltd" target="_blank" data-smartkarma-citation="entities:367:1" rel="noopener">Kerry Logistics Network (636 HK)</a> <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0809/2021080901151.pdf" target="_blank" rel="noopener">announced</a> on the 9 August all of the pre-cons attached to the the Partial Offer had been met - or waived (the Thai waiver in particular) - and that the Composite Document was expected to be dispatched, on or before, the 16 August.</p>
</div>
<div>
<p>The timing of that Record Date and the Close of the Offer suggested the FY21 Interim Dividend will likely be added to terms.</p>
<p>The Composite Doc is now <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0811/2021081101136.pdf" target="_blank" rel="noopener">out</a> and the Offer is open for acceptances. Irrevocables are expected to be tendered by the 16 August. The special dividend is expected to be declared the following day. The first close is the 2 September. It is quite possible this will also be the last closing date.</p>
</div>
<div>
<p>More below the fold.  Plus Ye Olde Arb Grids. </p>
</div>


Kerry Logistics Network (636 HK) announced on the 9 August all of the pre-cons attached to the the Partial Offer had been met - or waived (the Thai waiver in particular) - and that the Composite Document was expected to be dispatched, on or before, the 16 August.


The timing of that Record Date and the Close of the Offer suggested the FY21 Interim Dividend will likely be added to terms.
The Composite Doc is now out and the Offer is open for acceptances. Irrevocables are expected to be tendered by the 16 August. The special dividend is expected to be declared the following day. The first close is the 2 September. It is quite possible this will also be the last closing date.


More below the fold.  Plus Ye Olde Arb Grids. 


Kerry Logistics (636 HK): Doc Out Early - Offer Now Open

<div>
<p>On the 9 February, <a href="https://www.smartkarma.com/entities/kerry-logistics-network-ltd" target="_blank" data-smartkarma-citation="entities:367:1" rel="noopener">Kerry Logistics Network (636 HK)</a> ("KLN") <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0210/2021021000043.pdf" target="_blank" rel="noopener">announced</a> a pre-conditional Partial Offer from  <a href="https://www.smartkarma.com/entities/maanshan-dingtai-rare-a" target="_blank" data-smartkarma-citation="entities:4128:1" rel="noopener">S.F. Holding (002352 CH)</a> ("SFH"). SFH intended to acquire 931.21mn shares or 51.8% of shares outstanding, of KLN. The Offer price is HK$18.80/share - a 19.83% discount to last close, although KLN's shares gained 25% prior to the suspension.</p>
<p>Pre-conditions were numerous - 17 all-told - including approvals from SAMR, NDRC, MoC, CFIUS, FTC, and a waiver from the relevant Thai authorities not to make a downstream Offer for <a href="https://www.smartkarma.com/entities/kerry-express-thailand" target="_blank" data-smartkarma-citation="entities:29253:1" rel="noopener">Kerry Express Thailand (KEX TB)</a>.</p>
<p>The Partial Offer was also conditional on KLN selling its Hong Kong and Taiwan warehouses to its parent company. Proceeds from that sale would be paid to shareholders on the Record Date (means the date immediately prior to the Final Closing Date of the Partial Offer) as a special dividend totalling HK$7.28/share. Shareholders who tender will get HK$7.28 on <em>all</em> their shares and HK$18.80 for the shares taken up under the Partial Offer. </p>
<p>Below is a timeline of events since the initial announcement:</p>
<table class="table table-striped">
<tbody>
<tr>
<td style="width: 108.135px;">
<h3>Date</h3>
</td>
<td style="width: 637.877px;">
<h3>Data in that Date</h3>
</td>
</tr>
<tr>
<td style="width: 108.135px;">30-Mar-21</td>
<td style="width: 637.877px;">
<p>The controlling shareholders of KLN, including <a href="https://www.smartkarma.com/entities/kerry-properties-ltd" target="_blank" data-smartkarma-citation="entities:3320:1" rel="noopener">Kerry Properties (683 HK)</a>, plus shares held by executive directors, comprise 63.1% of shares out. These shareholders have given an irrevocable to tender 575.545mn shares or 32% of shares out. Those irrevocables have now been <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0330/2021033003206.pdf" target="_blank" rel="noopener">fulfilled</a> - this forms part of the pre-conditions.</p>
<p> </p>
<p>Elsewhere, KLN/ SF Holdings transaction is understood to be under a SAMR simple case review.</p>
</td>
</tr>
<tr>
<td style="width: 108.135px;">9-Apr-21</td>
<td style="width: 637.877px;">
<a href="https://www.smartkarma.com/entities/kerry-logistics-network-ltd" target="_blank" data-smartkarma-citation="entities:367:1" rel="noopener"></a>KLN <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0409/2021040901991.pdf" target="_blank" rel="noopener">announced</a> that the antitrust approval has been received from the State Administration for Market Regulation with respect to the Partial Offer.</td>
</tr>
<tr>
<td style="width: 108.135px;">3-May-21</td>
<td style="width: 637.877px;">KLN announced it will hold an SGM on the <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0503/2021050300069.pdf" target="_blank" rel="noopener">26 May</a> for shareholders to vote on the sale of the Hong Kong and Taiwan warehouse businesses to Kerry Holdings. </td>
</tr>
<tr>
<td style="width: 108.135px;">26-May-21</td>
<td style="width: 637.877px;">At the SGM KLN shareholders overwhelmingly <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0526/2021052600981.pdf" target="_blank" rel="noopener">approved</a> the sale of its Hong Kong, Taiwan warehouse business to Kerry Holdings.</td>
</tr>
<tr>
<td style="width: 108.135px;">7-Jun-21</td>
<td style="width: 637.877px;">The free float waiver from the SFC was <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0607/2021060701185.pdf" target="_blank" rel="noopener">received</a>. </td>
</tr>
<tr>
<td style="width: 108.135px;">15-Jun-21</td>
<td style="width: 637.877px;">Shareholders of Kerry Props <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0615/2021061501141.pdf" target="_blank" rel="noopener">approve</a> the Partial Offer. </td>
</tr>
<tr>
<td style="width: 108.135px;">29-Jun-21</td>
<td style="width: 637.877px;">CFIUS approval <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0629/2021062900794.pdf" target="_blank" rel="noopener">received</a>. </td>
</tr>
<tr>
<td style="width: 108.135px;">20-Jul-21</td>
<td style="width: 637.877px;">
<a href="https://www.smartkarma.com/entities/kerry-logistics-network-ltd" target="_blank" data-smartkarma-citation="entities:367:1" rel="noopener"></a>KLN <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0720/2021072000823.pdf" target="_blank" rel="noopener">announced</a> approval by the Independent Shareholders in respect of the Special Deal Agreements and the Framework Services Agreement had been obtained.</td>
</tr>
<tr>
<td style="width: 108.135px;">2-Aug-21</td>
<td style="width: 637.877px;">
<p>KLN <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0802/2021080201361.pdf" target="_blank" rel="noopener">announced</a> NDRC and MoC approval has been received as to the partial offer.</p>
</td>
</tr>
<tr>
<td colspan="2" style="width: 108.135px;"><em>Source: Various HKEx announcements</em></td>
</tr>
</tbody>
</table>
</div>
<div>
<p>Exactly on the Long Stop date, KLN has <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0809/2021080901151.pdf" target="_blank" rel="noopener">announced</a> all of the pre-cons have been met - or waived (the Thai waiver in particular) - and that the Composite Document is expected to be dispatched, on or before, the 16 August.</p>
<p>The timing of that Record Date and the Close of the Offer suggests the FY21 Interim Dividend will likely be added to terms.</p>
</div>
<div>
<p>More below the fold.  Plus Ye Olde Arb Grids - or at least one of them. </p>
</div>


On the 9 February, Kerry Logistics Network (636 HK) ("KLN") announced a pre-conditional Partial Offer from  S.F. Holding (002352 CH) ("SFH"). SFH intended to acquire 931.21mn shares or 51.8% of shares outstanding, of KLN. The Offer price is HK$18.80/share - a 19.83% discount to last close, although KLN's shares gained 25% prior to the suspension.
Pre-conditions were numerous - 17 all-told - including approvals from SAMR, NDRC, MoC, CFIUS, FTC, and a waiver from the relevant Thai authorities not to make a downstream Offer for Kerry Express Thailand (KEX TB).
The Partial Offer was also conditional on KLN selling its Hong Kong and Taiwan warehouses to its parent company. Proceeds from that sale would be paid to shareholders on the Record Date (means the date immediately prior to the Final Closing Date of the Partial Offer) as a special dividend totalling HK$7.28/share. Shareholders who tender will get HK$7.28 on all their shares and HK$18.80 for the shares taken up under the Partial Offer. 
Below is a timeline of events since the initial announcement:




Date


Data in that Date



30-Mar-21

The controlling shareholders of KLN, including Kerry Properties (683 HK), plus shares held by executive directors, comprise 63.1% of shares out. These shareholders have given an irrevocable to tender 575.545mn shares or 32% of shares out. Those irrevocables have now been fulfilled - this forms part of the pre-conditions.
 
Elsewhere, KLN/ SF Holdings transaction is understood to be under a SAMR simple case review.



9-Apr-21

KLN announced that the antitrust approval has been received from the State Administration for Market Regulation with respect to the Partial Offer.


3-May-21
KLN announced it will hold an SGM on the 26 May for shareholders to vote on the sale of the Hong Kong and Taiwan warehouse businesses to Kerry Holdings. 


26-May-21
At the SGM KLN shareholders overwhelmingly approved the sale of its Hong Kong, Taiwan warehouse business to Kerry Holdings.


7-Jun-21
The free float waiver from the SFC was received. 


15-Jun-21
Shareholders of Kerry Props approve the Partial Offer. 


29-Jun-21
CFIUS approval received. 


20-Jul-21

KLN announced approval by the Independent Shareholders in respect of the Special Deal Agreements and the Framework Services Agreement had been obtained.


2-Aug-21

KLN announced NDRC and MoC approval has been received as to the partial offer.



Source: Various HKEx announcements





Exactly on the Long Stop date, KLN has announced all of the pre-cons have been met - or waived (the Thai waiver in particular) - and that the Composite Document is expected to be dispatched, on or before, the 16 August.
The timing of that Record Date and the Close of the Offer suggests the FY21 Interim Dividend will likely be added to terms.


More below the fold.  Plus Ye Olde Arb Grids - or at least one of them. 


Kerry Logistics (636 HK): Pre-Cons Done. Partial Offer To Commence Next Week

ASEAN Insight Provider, CrossASEAN Research

Angus Mackintosh

ASEAN Insight Provider

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

Equity Bottom-Up

<div class="content-highlight">
<p><a href="https://www.smartkarma.com/entities/adi-sarana-armada-tbk-pt" target="_blank" data-smartkarma-citation="entities:16947:1" rel="noopener">Adi Sarana Armada (ASSA IJ)</a> released a stellar set of 1Q2021 results, with revenue growth of +37.3% YoY, and net profit growth of +27.1% YoY, which continued to reflect better than expected growth in its end-to-end logistics business, and notably Anteraja, its last-mile delivery service.</p>
</div>
<p>The company's three pillars including transport, car auction, and end-to-end logistics, all registered strong growth. The company's last-mile express delivery service Anteraja saw especially strong growth driven by the e-commerce ecosystem as it is providing deliveries for most of the major players. </p>
<p>Anteraja's continues to expand its business, with daily parcel deliveries hitting 500,000 in 1Q2021 and targets 700,000-750,000 parcels a day by the end of the year.</p>
<section class="figure"></section>
<section class="figure"><a href="https://www.smartkarma.com/entities/adi-sarana-armada-tbk-pt" target="_blank" data-smartkarma-citation="entities:16947:1" rel="noopener">Adi Sarana Armada (ASSA IJ)</a>'s auction business also recorded positive revenue growth of +3.8%  in 1Q2021 but has seen a recent pick up in growth. </section>
<section class="figure"></section>
<section class="figure"></section>
<section class="figure"></section>
<section class="figure"><a href="https://www.smartkarma.com/entities/adi-sarana-armada-tbk-pt" target="_blank" data-smartkarma-citation="entities:16947:1" rel="noopener"></a>The company continues to develop its app-based businesses such as Share Car and used car marketplace, Caroline.</section>
<section class="figure"></section>
<section class="figure"></section>
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<div>
<p><a href="https://www.smartkarma.com/entities/adi-sarana-armada-tbk-pt" target="_blank" data-smartkarma-citation="entities:16947:1" rel="noopener">Adi Sarana Armada (ASSA IJ)</a> targets revenue growth 0f +20%-25% for 2021 mainly driven by the growth from end-to-end logistics and specifically Anteraja, together with e-commerce sharing warehouse Titipaja. </p>
</div>
<p>The company also recently had its rights issue of zero-coupon convertible bonds approved, which will raise a total of IDR720bn. This will help the company reduce the debt used to expand its logistics businesses over the past year.</p>
<p>We continue to believe in the <a href="https://www.smartkarma.com/entities/adi-sarana-armada-tbk-pt" target="_blank" data-smartkarma-citation="entities:16947:1" rel="noopener">Adi Sarana Armada (ASSA IJ)</a> digital transformation story, with ongoing synergies between the three pillars of its business.</p>
<p><a href="https://www.smartkarma.com/entities/adi-sarana-armada-tbk-pt" target="_blank" data-smartkarma-citation="entities:16947:1" rel="noopener">Adi Sarana Armada (ASSA IJ)</a> trades on 10.9x FY21E EV/EBITDA and 8.7x FY22E EV/EBITDA and an FY22E PER of 30x but we expect continuing momentum behind the growth and rising profitability story, as Anteraja gains scale and grows its revenues.</p>
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<section class="figure">
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<div id="ember5694"></div>
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Adi Sarana Armada (ASSA IJ) released a stellar set of 1Q2021 results, with revenue growth of +37.3% YoY, and net profit growth of +27.1% YoY, which continued to reflect better than expected growth in its end-to-end logistics business, and notably Anteraja, its last-mile delivery service.

The company's three pillars including transport, car auction, and end-to-end logistics, all registered strong growth. The company's last-mile express delivery service Anteraja saw especially strong growth driven by the e-commerce ecosystem as it is providing deliveries for most of the major players. 
Anteraja's continues to expand its business, with daily parcel deliveries hitting 500,000 in 1Q2021 and targets 700,000-750,000 parcels a day by the end of the year.

Adi Sarana Armada (ASSA IJ)'s auction business also recorded positive revenue growth of +3.8%  in 1Q2021 but has seen a recent pick up in growth. 



The company continues to develop its app-based businesses such as Share Car and used car marketplace, Caroline.





Adi Sarana Armada (ASSA IJ) targets revenue growth 0f +20%-25% for 2021 mainly driven by the growth from end-to-end logistics and specifically Anteraja, together with e-commerce sharing warehouse Titipaja. 

The company also recently had its rights issue of zero-coupon convertible bonds approved, which will raise a total of IDR720bn. This will help the company reduce the debt used to expand its logistics businesses over the past year.
We continue to believe in the Adi Sarana Armada (ASSA IJ) digital transformation story, with ongoing synergies between the three pillars of its business.
Adi Sarana Armada (ASSA IJ) trades on 10.9x FY21E EV/EBITDA and 8.7x FY22E EV/EBITDA and an FY22E PER of 30x but we expect continuing momentum behind the growth and rising profitability story, as Anteraja gains scale and grows its revenues.






Adi Sarana Armada (ASSA IJ) - End-To End Aspirations on Track

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

Full Truck Alliance   / Equity Capital Markets

<p><a href="https://www.smartkarma.com/entities/full-truck-alliance" target="_blank" data-smartkarma-citation="entities:33429:1" rel="noopener">Full Truck Alliance (YMM US)</a>, known as <em>Manbang</em> in China, is the world’s largest digital freight platform by gross transaction value (GTV) in 2020, according to CIC. FTA was formed in 2017 through the merger of <em>Yunmanman</em> and <em>Huochebang</em>, which were founded in 2013 and 2011, respectively. FTA is seeking to raise $1.5 billion through an NYSE listing, according to press reports. FTA is backed by SoftBank Vision Fund (22.2% of the outstanding shares), Sequoia Capital (7.2%), Hillhouse and <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent (700 HK)</a>. </p><p>FTA joins peer <a href="https://www.smartkarma.com/entities/foru-worldwide-inc" target="_blank" data-smartkarma-citation="entities:33314:1" rel="noopener">ForU Worldwide (FOYO US)</a> which also recently filed for a $500 million Nasdaq IPO. Confusingly, ForU notes that it is the largest technology-driven road freight transportation platform in China as measured by revenue in 2020, according to CIC. However, comparing FTA and ForU based on reported revenue is an apples-to-oranges comparison due to differing revenue recognition policies. In <a href="https://www.smartkarma.com/insights/foru-worldwide-ipo-initiation-not-foru" target="_blank" data-smartkarma-citation="insights:51888" rel="noopener">ForU Worldwide IPO Initiation: Not ForU</a>, we opined that ForU faces several challenges and the financials on a normalised basis appears to be middling at best.    </p><div class="content-highlight"><p>At first sight, FTA recent results look stunning due to fast-paced growth, improving margin and cash generation. However, a closer look, suggests that FTA has less than ideal disclosure, a regulatory overhang and potential corporate governance issues. In an environment where sentiment on high-growth stocks and in particular Chinese US tech listings is weak, IPO hopefuls should not provide ready ammunition to the bears. Consequently, we cannot recommend FTA wholeheartedly and inclined to watch this IPO unfold from the sidelines.   </p></div>

Full Truck Alliance (YMM US), known as Manbang in China, is the world’s largest digital freight platform by gross transaction value (GTV) in 2020, according to CIC. FTA was formed in 2017 through the merger of Yunmanman and Huochebang, which were founded in 2013 and 2011, respectively. FTA is seeking to raise $1.5 billion through an NYSE listing, according to press reports. FTA is backed by SoftBank Vision Fund (22.2% of the outstanding shares), Sequoia Capital (7.2%), Hillhouse and Tencent (700 HK). FTA joins peer ForU Worldwide (FOYO US) which also recently filed for a $500 million Nasdaq IPO. Confusingly, ForU notes that it is the largest technology-driven road freight transportation platform in China as measured by revenue in 2020, according to CIC. However, comparing FTA and ForU based on reported revenue is an apples-to-oranges comparison due to differing revenue recognition policies. In ForU Worldwide IPO Initiation: Not ForU, we opined that ForU faces several challenges and the financials on a normalised basis appears to be middling at best.    At first sight, FTA recent results look stunning due to fast-paced growth, improving margin and cash generation. However, a closer look, suggests that FTA has less than ideal disclosure, a regulatory overhang and potential corporate governance issues. In an environment where sentiment on high-growth stocks and in particular Chinese US tech listings is weak, IPO hopefuls should not provide ready ammunition to the bears. Consequently, we cannot recommend FTA wholeheartedly and inclined to watch this IPO unfold from the sidelines.   

Full Truck Alliance IPO Initiation: A Less than Perfect Delivery

Hong Kong

S. F. Holding Co., Ltd. offers express courier services. The Company provides logistics, order tracking, supply chain management, warehousing, and other services. S. F. Holding offers services worldwide.

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S.F. Holding (6936 HK)

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Adi Sarana Armada (ASSA IJ) - End-To End Aspirations on Track

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Angus Mackintosh

Full Truck Alliance IPO Initiation: A Less than Perfect Delivery

FTA is seeking to raise $1.5 billion through an NYSE listing, according to press reports. We cannot recommend FTA wholeheartedly and inclined to...

Arun George

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