HK/China Equity Long-Short

Osbert Tang, CFA

Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/mixue-group" target="_blank" data-smartkarma-citation="entities:40623:1" rel="noopener">Mixue Group (MIX HK)</a> has a whopping market share of 32.7% in 2023, based on number of cups sold. It also has the highest profit in the sector.</li>
<li>With a strong profit record and net cash, it is a leader that captures industry growth. Its extensive network targets low-tier cities' potential and the franchise model drives expansion.  </li>
<li>It justifies trading on a premium to sector average PER of 19.6x for FY25. If aligning P/B with ROE on the best-fit line, it should be priced at 5.1x pre-money.</li>
</ul>



Mixue Group (MIX HK) has a whopping market share of 32.7% in 2023, based on number of cups sold. It also has the highest profit in the sector.
With a strong profit record and net cash, it is a leader that captures industry growth. Its extensive network targets low-tier cities' potential and the franchise model drives expansion.  
It justifies trading on a premium to sector average PER of 19.6x for FY25. If aligning P/B with ROE on the best-fit line, it should be priced at 5.1x pre-money.


MIXUE Group IPO: The Leading Player that Justifies a Premium

APAC IPOs & Placements, Aequitas Research

Clarence Chu

APAC 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.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/guming-holdings-limited" target="_blank" data-smartkarma-citation="entities:40622:1" rel="noopener">Guming Holdings (1364 HK)</a> raised US$233m in its Hong Kong IPO. Guming Holdings (Guming) sells freshly-made beverages in China.</li>
<li>Guming Holdings (Guming) sells freshly-made beverages in China. Guming focuses on the mid-priced freshly-made tea beverage market with product prices typically ranging between RMB10-18.</li>
<li>We have covered various aspects of the deal in our previous note. In this note, we will talk about the demand and trading dynamics.</li>
</ul>



Guming Holdings (1364 HK) raised US$233m in its Hong Kong IPO. Guming Holdings (Guming) sells freshly-made beverages in China.
Guming Holdings (Guming) sells freshly-made beverages in China. Guming focuses on the mid-priced freshly-made tea beverage market with product prices typically ranging between RMB10-18.
We have covered various aspects of the deal in our previous note. In this note, we will talk about the demand and trading dynamics.


Guming Holdings IPO Trading - Strong Retail Demand, with Decent Coverage on the Insti Tranche

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

<ul>
<li>
<a href="https://www.smartkarma.com/entities/mixue-group" target="_blank" data-smartkarma-citation="entities:40623:1" rel="noopener">Mixue Group</a> is looking to raise about US$1bn in its upcoming Hong Kong IPO.</li>
<li>MIXUE Group (MIXUE) is a freshly-made drinks company providing affordable products to consumers, including freshly-made fruit drinks, tea, ice cream and coffee, typically priced at around one USD per item.</li>
<li>In our earlier notes, we have looked at the past performance, undertaken a peer comparison and spoken about valuations. In this note, we talk about updates from its recent filings.</li>
</ul>



Mixue Group is looking to raise about US$1bn in its upcoming Hong Kong IPO.
MIXUE Group (MIXUE) is a freshly-made drinks company providing affordable products to consumers, including freshly-made fruit drinks, tea, ice cream and coffee, typically priced at around one USD per item.
In our earlier notes, we have looked at the past performance, undertaken a peer comparison and spoken about valuations. In this note, we talk about updates from its recent filings.


MIXUE Pre-IPO - Refiling Updates - Slower Growth but Better Margins

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/tam-jai-international-co-ltd" target="_blank" rel="noopener">Tam Jai Intl (2217 HK)</a>'s suspension has led to speculation about a privatisation or takeover. Its huge net cash, equal to 115% of market capitalisation, makes it appealing. </li>
<li>Its controlling shareholder Toridoll Holding Limited owns a 74.61% stake and there is no shareholder with more than a 5% interest. This makes a deal seemingly simple.</li>
<li>Assuming priced at the average P/B of 1.63x, this means HK$1.90, or 110% premium to the latest close, which is costly to the major shareholder.</li>
</ul>



Tam Jai Intl (2217 HK)'s suspension has led to speculation about a privatisation or takeover. Its huge net cash, equal to 115% of market capitalisation, makes it appealing. 
Its controlling shareholder Toridoll Holding Limited owns a 74.61% stake and there is no shareholder with more than a 5% interest. This makes a deal seemingly simple.
Assuming priced at the average P/B of 1.63x, this means HK$1.90, or 110% premium to the latest close, which is costly to the major shareholder.


Tam Jai Intl (2217 HK): Is It Privatisation or Takeover?

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

<ul>
<li><em><strong>Our base case valuation of Guming Holding is implied target price of HKD 13.70, which is 38%  higher than the high end of the IPO valuation range. </strong></em></li>
<li>Given the solid upside, we have a Positive view of this IPO. Our valuation sensitivity analysis suggests a range of HKD 11.09 to HKD 16.57 per share.  </li>
<li>Our base case valuation is based on 2025E P/S multiple of 3x, which is a 30% premium to the two closest comps (Sichuan Baicha Baidao Industrial and Helens International Holdings). </li>
</ul>


Our base case valuation of Guming Holding is implied target price of HKD 13.70, which is 38%  higher than the high end of the IPO valuation range. 
Given the solid upside, we have a Positive view of this IPO. Our valuation sensitivity analysis suggests a range of HKD 11.09 to HKD 16.57 per share.  
Our base case valuation is based on 2025E P/S multiple of 3x, which is a 30% premium to the two closest comps (Sichuan Baicha Baidao Industrial and Helens International Holdings). 


China

Sichuan Baicha Baidao Industrial Co., Ltd. develops and sells diversified tea beverage products, primarily through a franchise model under its 'ChaPanda' brand. The company offers a range of classic, seasonal, and regional tea drinks, and also manages supply chain, franchise operations, and related services. It was founded in 2008 and is headquartered in Chengdu, People's Republic of China.

Sichuan Baicha Baidao Industrial (2555 HK)

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Sichuan Baicha Baidao Industrial (2555 HK)

MIXUE Group IPO: The Leading Player that Justifies a Premium

Mixue has a 32.7% share in the freshly-made drinks market and the highest profit, poised for growth in low-tier cities with the franchise model....

Osbert Tang, CFA

Guming Holdings IPO Trading - Strong Retail Demand, with Decent Coverage on the Insti Tranche

Guming Holdings (1364 HK) raised US$233m in its Hong Kong IPO. We have covered various aspects of the deal in our previous note. In this note, we...

Clarence Chu

MIXUE Pre-IPO - Refiling Updates - Slower Growth but Better Margins

Mixue Group is looking to raise about US$1bn in its upcoming Hong Kong IPO. In this note, we talk about the updates from its recent refiling.

Sumeet Singh

Tam Jai Intl (2217 HK): Is It Privatisation or Takeover?

Tam Jai Intl's suspension sparks privatisation or takeover speculations, given its high net cash and simple ownership structure. However, a...

Osbert Tang, CFA

Guming Holding IPO Valuation Analysis

Our base case valuation of Guming Holding is implied target price of HKD 13.70, which is 38% higher than the high end of the IPO valuation range.

Douglas Kim

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

MIXUE Group IPO: The Leading Player that Justifies a Premium

​Mixue has a 32.7% share in the freshly-made drinks market and the highest profit, poised for growth in low-tier cities with the franchise model....

Osbert Tang, CFA

Guming Holdings IPO Trading - Strong Retail Demand, with Decent Coverage on the Insti Tranche

Guming Holdings (1364 HK) raised US$233m in its Hong Kong IPO. We have covered various aspects of the deal in our previous note. In this note, we...

Clarence Chu

MIXUE Pre-IPO - Refiling Updates - Slower Growth but Better Margins

Mixue Group is looking to raise about US$1bn in its upcoming Hong Kong IPO. In this note, we talk about the updates from its recent refiling.

Sumeet Singh

Tam Jai Intl (2217 HK): Is It Privatisation or Takeover?

​Tam Jai Intl's suspension sparks privatisation or takeover speculations, given its high net cash and simple ownership structure. However, a...

Osbert Tang, CFA

Guming Holding IPO Valuation Analysis

Our base case valuation of Guming Holding is implied target price of HKD 13.70, which is 38% higher than the high end of the IPO valuation range.

Douglas Kim

Mixue has a 32.7% share in the freshly-made drinks market and the highest profit, poised for growth in low-tier cities with the franchise model....

Tam Jai Intl's suspension sparks privatisation or takeover speculations, given its high net cash and simple ownership structure. However, a...