Equity Analyst, LightStream Research

Oshadhi Kumarasiri

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 Bottom-Up

<a href="https://www.smartkarma.com/entities/sea-ltd" target="_blank" data-smartkarma-citation="entities:8509:1" rel="noopener">Sea Ltd (SE US)</a> is a Singapore based internet company with three main business lines named Garena, Shopee and SeaMoney.
The company had a secondary offering of 13.2 million ADS (US$2.6 billion), each representing one class A ordinary share, at US$ 195.0 per ADS, 2.0% discount to the last sale price immediately before the announcement. Overallotment option was 1.98 million ADS.
The company's share price surged more than 420% this year as COVID-19 was beneficial for all three business lines of Sea Ltd. In <a href="https://www.smartkarma.com/insights/sea-ltd-placement-draining-the-cash-cow-in-search-of-e-commerce-and-fintech-growth" target="_blank" rel="noopener">Sea Ltd Placement: Draining the Cash-Cow in Search of E-Commerce and Fintech Growth</a>, we looked at the company’s most lucrative Digital Entertainment/Gaming segment. This insight focuses on fundamentals and long-term prospects of Shopee and SeaMoney businesses.

Sea Ltd (SE US) is a Singapore based internet company with three main business lines named Garena, Shopee and SeaMoney.
The company had a secondary offering of 13.2 million ADS (US$2.6 billion), each representing one class A ordinary share, at US$ 195.0 per ADS, 2.0% discount to the last sale price immediately before the announcement. Overallotment option was 1.98 million ADS.
The company's share price surged more than 420% this year as COVID-19 was beneficial for all three business lines of Sea Ltd. In Sea Ltd Placement: Draining the Cash-Cow in Search of E-Commerce and Fintech Growth, we looked at the company’s most lucrative Digital Entertainment/Gaming segment. This insight focuses on fundamentals and long-term prospects of Shopee and SeaMoney businesses.

Sea Ltd: Draining the Cash-Cow in Search of E-Commerce and Fintech Growth - Part II

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

Private Capital Markets

<a href="https://www.smartkarma.com/entities/tokopedia-pt" target="_blank" data-smartkarma-citation="entities:24239:1" rel="noopener">Tokopedia PT (1087142D IJ)</a> has confirmed that it has hired Morgan Stanley and Citigroup as advisers to help accelerate its plan to go public. The company has not yet decided which route to take to come to market, whether through a straightforward IPO or a SPAC listing, potentially through Richard Li and Peter Thiel's Bridgetown Holdings Ltd.
The company had previously stated that it would definitely seek a listing in its home market of Indonesia, with a potential dual listing in the US, although these statements were made pre-pandemic. 
Valuations for <a href="https://www.smartkarma.com/entities/tokopedia-pt" target="_blank" data-smartkarma-citation="entities:24239:1" rel="noopener">Tokopedia PT (1087142D IJ)</a> range from US$8-10bn, although after the last round of funding it was valued at US$7.5bn, making it Indonesia's second most valuation start-up after <a href="https://www.smartkarma.com/entities/gojek" target="_blank" data-smartkarma-citation="entities:25976:1" rel="noopener">Gojek (1379371D IJ)</a>, which was last valued at US$10bn.
An IPO would help the company realize a higher valuation, providing a currency to drive future growth, given it would be an alternative to <a href="https://www.smartkarma.com/entities/sea-ltd" target="_blank" data-smartkarma-citation="entities:8509:1" rel="noopener">Sea Ltd (SE US), </a>as the number 2 e-commerce player in Indonesia. <a href="https://www.smartkarma.com/entities/sea-ltd" target="_blank" data-smartkarma-citation="entities:8509:1" rel="noopener">Sea Ltd (SE US)</a> trades at 13x FY21E EV/Sales currently and just raised more than US$2bn through a placement of new ADS's. We look at <a href="https://www.smartkarma.com/entities/tokopedia-pt" target="_blank" data-smartkarma-citation="entities:24239:1" rel="noopener">Tokopedia PT (1087142D IJ)</a> and its positioning in more detail below the fold.

Tokopedia PT (1087142D IJ) has confirmed that it has hired Morgan Stanley and Citigroup as advisers to help accelerate its plan to go public. The company has not yet decided which route to take to come to market, whether through a straightforward IPO or a SPAC listing, potentially through Richard Li and Peter Thiel's Bridgetown Holdings Ltd.
The company had previously stated that it would definitely seek a listing in its home market of Indonesia, with a potential dual listing in the US, although these statements were made pre-pandemic. 
Valuations for Tokopedia PT (1087142D IJ) range from US$8-10bn, although after the last round of funding it was valued at US$7.5bn, making it Indonesia's second most valuation start-up after Gojek (1379371D IJ), which was last valued at US$10bn.
An IPO would help the company realize a higher valuation, providing a currency to drive future growth, given it would be an alternative to Sea Ltd (SE US), as the number 2 e-commerce player in Indonesia. Sea Ltd (SE US) trades at 13x FY21E EV/Sales currently and just raised more than US$2bn through a placement of new ADS's. We look at Tokopedia PT (1087142D IJ) and its positioning in more detail below the fold. 

Tokopedia PT (1087142D IJ) - From Private to Public by Hook or by Crook

A follow-up call with <a href="https://www.smartkarma.com/entities/mitra-adiperkasa-tbk-pt" target="_blank" data-smartkarma-citation="entities:18684:1" rel="noopener">Mitra Adiperkasa (MAPI IJ)</a> management after it released results to get a better feel for its digital initiatives revealed continuing positive momentum behind the company's "Unified Retail" approach to its business, with its digital presence likely to continue to drive its future growth. 
The company has already put through some aggressive inventory adjustments, which put it in a good position to benefit from the pick-up in sales towards the end of the year, without aggressive blanket promotions.
The drive online is being channeled through MAPclub, which now has 3.25m members, and is the largest loyalty program in Indonesia. This will continue to be a key growth driver for <a href="https://www.smartkarma.com/entities/mitra-adiperkasa-tbk-pt" target="_blank" data-smartkarma-citation="entities:18684:1" rel="noopener">Mitra Adiperkasa (MAPI IJ)</a> in 2021.
<a href="https://www.smartkarma.com/entities/map-aktif-adiperkasa-pt" target="_blank" data-smartkarma-citation="entities:27291:1" rel="noopener">MAP Aktif Adiperkasa PT (MAPA IJ)</a> will continue to benefit from increased health consciousness amongst Indonesians and has an even higher portion of its sales online than <a href="https://www.smartkarma.com/entities/mitra-adiperkasa-tbk-pt" target="_blank" data-smartkarma-citation="entities:18684:1" rel="noopener">Mitra Adiperkasa (MAPI IJ)</a>. 
<a href="https://www.smartkarma.com/entities/mitra-adiperkasa-tbk-pt" target="_blank" data-smartkarma-citation="entities:18684:1" rel="noopener">Mitra Adiperkasa (MAPI IJ)</a> will launch Boots and Amore Pacific brands in the coming year, which should boost growth and it has dropped some non-performing brands. DigiMAP, the company's online electronics platform, will also be an ongoing growth driver. 
The company is trading on 24.9x FY21E PER and 15.8x FY22E PER versus its 3-year average forward PER of 21x and continues to be our top pick as a play on the retail recovery.

A follow-up call with Mitra Adiperkasa (MAPI IJ) management after it released results to get a better feel for its digital initiatives revealed continuing positive momentum behind the company's "Unified Retail" approach to its business, with its digital presence likely to continue to drive its future growth. 
The company has already put through some aggressive inventory adjustments, which put it in a good position to benefit from the pick-up in sales towards the end of the year, without aggressive blanket promotions.
The drive online is being channeled through MAPclub, which now has 3.25m members, and is the largest loyalty program in Indonesia. This will continue to be a key growth driver for Mitra Adiperkasa (MAPI IJ) in 2021.
MAP Aktif Adiperkasa PT (MAPA IJ) will continue to benefit from increased health consciousness amongst Indonesians and has an even higher portion of its sales online than Mitra Adiperkasa (MAPI IJ). 
Mitra Adiperkasa (MAPI IJ) will launch Boots and Amore Pacific brands in the coming year, which should boost growth and it has dropped some non-performing brands. DigiMAP, the company's online electronics platform, will also be an ongoing growth driver. 
The company is trading on 24.9x FY21E PER and 15.8x FY22E PER versus its 3-year average forward PER of 21x and continues to be our top pick as a play on the retail recovery.

Mitra Adiperkasa (MAPI IJ) - Unifying with the Digital World

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

iQiyi aims to raise around US$1.7bn from a convertible bond and primary follow-on offering. The ADS offering is expected to raise around US$900m, with the balance coming from the convertible bond offering. Its been a rough year for the stock with a short-seller targeting the company and operations lagging as well.We have covered the company's performance previously in:<ul>
<li><a href="https://www.smartkarma.com/insights/iqiyi-some-flaws-in-the-wolfpack-s-short-seller-report" target="_blank" rel="noopener">IQIYI: Some Flaws in the Wolfpack’s Short Seller Report</a></li>
<li><a href="https://www.smartkarma.com/insights/iqiyi-iq-why-chinese-netflix-dismissing-employees-during-home-staying-a-content-angle" target="_blank" rel="noopener">IQiyi (IQ): Why “Chinese Netflix” Dismissing Employees During Home Staying? A Content Angle</a></li>
<li><a href="https://www.smartkarma.com/insights/iqiyi-iq-an-empty-tv-box" target="_blank" rel="noopener">IQiyi (IQ): An Empty TV Box</a></li>
</ul>

iQiyi aims to raise around US$1.7bn from a convertible bond and primary follow-on offering. The ADS offering is expected to raise around US$900m, with the balance coming from the convertible bond offering. Its been a rough year for the stock with a short-seller targeting the company and operations lagging as well.We have covered the company's performance previously in:
IQIYI: Some Flaws in the Wolfpack’s Short Seller Report
IQiyi (IQ): Why “Chinese Netflix” Dismissing Employees During Home Staying? A Content Angle
IQiyi (IQ): An Empty TV Box


IQiyi Placement - An Ex-Growth Netflix - Needs a Deep Deep Discount

<a href="https://www.smartkarma.com/entities/sea-ltd" target="_blank" data-smartkarma-citation="entities:8509:1" rel="noopener">Sea Ltd (SE US)</a>, a Singapore based internet company, that operates a mobile gaming platform called Garena, an e-commerce platform called Shopee and a fintech business called SeaMoney had a secondary offering of 13.2 million ADS, each representing one class A ordinary share, at US$ 195.0 per ADS, 2.0% discount to the last sale price immediately before the announcement. An overallotment option of 1.98 million ADS, if exercised, could increase the size of the secondary offer by US$386 million to $2.96 billion.
Sea’s share price is currently about 2.4% below the secondary offer price. As the company prepares to finalize the secondary offer, we take a look at Sea’s fundamentals in a series of insights, assessing the company’s long-term growth prospects.

Sea Ltd (SE US), a Singapore based internet company, that operates a mobile gaming platform called Garena, an e-commerce platform called Shopee and a fintech business called SeaMoney had a secondary offering of 13.2 million ADS, each representing one class A ordinary share, at US$ 195.0 per ADS, 2.0% discount to the last sale price immediately before the announcement. An overallotment option of 1.98 million ADS, if exercised, could increase the size of the secondary offer by US$386 million to $2.96 billion.
Sea’s share price is currently about 2.4% below the secondary offer price. As the company prepares to finalize the secondary offer, we take a look at Sea’s fundamentals in a series of insights, assessing the company’s long-term growth prospects.

Sea Ltd Placement: Draining the Cash-Cow in Search of E-Commerce and Fintech Growth

Singapore

Sea Limited offers information technology services. The Company provides online personal computer and mobile digital content, e-commerce, and payment platforms. Sea serves customers worldwide.

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Sea Ltd (SE US)

Sea Ltd: Draining the Cash-Cow in Search of E-Commerce and Fintech Growth - Part II

Fintech business is still in early stages and its losses could more than offset the small improvements in Shopee and without Free Fire to offset...

Oshadhi Kumarasiri

Tokopedia PT (1087142D IJ) - From Private to Public by Hook or by Crook

Tokopedia has confirmed that it is looking to go public and has enlisted Investment Banks to speed the process. This will give investors an...

Angus Mackintosh

Mitra Adiperkasa (MAPI IJ) - Unifying with the Digital World

MAPI continues to be our preferred proxy for the Indonesian retail recovery in Indonesia for next year, having successfully harnessed its online...

Angus Mackintosh

IQiyi Placement - An Ex-Growth Netflix - Needs a Deep Deep Discount

iQiyi aims to raise around US$1.7bn from a CB and primary follow-on offering. The ADS offering is expected to raise around US$900m, with the...

Sumeet Singh

Sea Ltd Placement: Draining the Cash-Cow in Search of E-Commerce and Fintech Growth

Sea Ltd is letting the cash cow run dry, hoping e-commerce and Digital Financial Services segments will come through before the cash cow fall. We...

Oshadhi Kumarasiri

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