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

<ul>
<li>
<a href="https://www.smartkarma.com/entities/tokyo-metro-co-ltd" target="_blank" data-smartkarma-citation="entities:40930:1" rel="noopener">Tokyo Metro (9023 JP)</a>, a mass transit operator, is seeking to raise up to US$2.3 billion. Pricing is on 15 October, and the listing is on 23 October.</li>
<li>In <em><strong><a href="https://www.smartkarma.com/insights/tokyo-metro-9023-jp-ipo-the-bull-case" target="_blank" data-smartkarma-citation="insights:160168" rel="noopener">Tokyo Metro (9023 JP) IPO: The Bull Case</a></strong></em>, we highlighted the key elements of the bull case. In this note, we outline the bear case.</li>
<li>The bear case rests on mid-tier revenue growth, low revenue diversification, the highest leverage among peers and a sizeable post-IPO share overhang. </li>
</ul>



Tokyo Metro (9023 JP), a mass transit operator, is seeking to raise up to US$2.3 billion. Pricing is on 15 October, and the listing is on 23 October.
In Tokyo Metro (9023 JP) IPO: The Bull Case, we highlighted the key elements of the bull case. In this note, we outline the bear case.
The bear case rests on mid-tier revenue growth, low revenue diversification, the highest leverage among peers and a sizeable post-IPO share overhang. 


<ul>
<li>
<a href="https://www.smartkarma.com/entities/tokyo-metro" target="_blank" data-smartkarma-citation="entities:40930:1" rel="noopener">Tokyo Metro (TKYMETRO JP)</a>, a mass transit operator, is seeking to raise up to US$2.3 billion. Pricing is on 15 October, and the listing is on 23 October.   </li>
<li>Tokyo Metro is held 53.42% by the Minister of Finance and 46.58% by the Tokyo Metropolitan Government. </li>
<li>The bull case rests on a core high-quality asset, future growth drivers, top-quartile profitability, high FCF generation, and peer-leading dividend payout. </li>
</ul>



Tokyo Metro (TKYMETRO JP), a mass transit operator, is seeking to raise up to US$2.3 billion. Pricing is on 15 October, and the listing is on 23 October.   
Tokyo Metro is held 53.42% by the Minister of Finance and 46.58% by the Tokyo Metropolitan Government. 
The bull case rests on a core high-quality asset, future growth drivers, top-quartile profitability, high FCF generation, and peer-leading dividend payout. 


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

Event-Driven

<ul>
<li>There are a bunch of stocks that have underperformed the <a href="https://www.smartkarma.com/entities/nikkei-225" target="_blank" data-smartkarma-citation="entities:22909:1" rel="noopener">Nikkei 225 (NKY INDEX)</a> and their peers and could be deleted from global passive portfolios in May.</li>
<li>The deletion from passive portfolios will lead to a liquidity event at the end of May where passive trackers will need to sell multiple days of ADV.</li>
<li>Shorts have been built up on all the stocks over the last few months and the extent of the positioning varies across stocks.</li>
</ul>


There are a bunch of stocks that have underperformed the Nikkei 225 (NKY INDEX) and their peers and could be deleted from global passive portfolios in May.
The deletion from passive portfolios will lead to a liquidity event at the end of May where passive trackers will need to sell multiple days of ADV.
Shorts have been built up on all the stocks over the last few months and the extent of the positioning varies across stocks.


Japan - Increase in Shorts & Potential Passive Selling in May

Asian Insight Provider - Actionable ideas, CrossASEAN Research

Henry Soediarko

Asian Insight Provider - Actionable ideas

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

Keisei Electric Railway Co / Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/keisei-electric-railway-co" target="_blank" data-smartkarma-citation="entities:10876:1" rel="noopener">Keisei Electric Railway Co (9009 JP)</a> share price has increased but not run ahead of its fundamentals.</li>
<li>Weak Yen, COVID rebound, friendlier visa policy by the Japanese government, and the potential for more Chinese tourists visiting Japan are tailwinds for Keisei.</li>
<li>Valuation may look expensive, but with the high growth rate, investors should consider to use PEG rather than PER or PBR.</li>
</ul>



Keisei Electric Railway Co (9009 JP) share price has increased but not run ahead of its fundamentals.
Weak Yen, COVID rebound, friendlier visa policy by the Japanese government, and the potential for more Chinese tourists visiting Japan are tailwinds for Keisei.
Valuation may look expensive, but with the high growth rate, investors should consider to use PEG rather than PER or PBR.


Keisei Electric Rail (9009): Can Be Higher

<ul>
<li>The moment of truth is here, the Chinese are finally coming back to Japan. </li>
<li>
<a href="https://www.smartkarma.com/entities/keisei-electric-railway-co" target="_blank" data-smartkarma-citation="entities:10876:1" rel="noopener">Keisei Electric Railway Co (9009 JP)</a> is one of the biggest beneficiaries of increased tourist arrivals in Japan. </li>
<li>It is trading at 0.04 PEG, a very low valuation considering its potential for producing large growth rate. </li>
</ul>


The moment of truth is here, the Chinese are finally coming back to Japan. 

Keisei Electric Railway Co (9009 JP) is one of the biggest beneficiaries of increased tourist arrivals in Japan. 
It is trading at 0.04 PEG, a very low valuation considering its potential for producing large growth rate. 


Keisei Electric (9009): The Chinese Are Back.

Japan

TOBU RAILWAY CO., LTD. mainly provides passenger rail and bus transportation services in the Kanto area.  The Company also operates a variety of real estate businesses which construct and sell apartment buildings and single houses, and lease buildings.  Tobu Railway operates an array of businesses such as distributors, amusement parks, and hotels.

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Tobu Railway (9001 JP)

Tokyo Metro (9023 JP) IPO: The Bear Case

The bear case rests on mid-tier revenue growth, low revenue diversification, the highest leverage among peers and a sizeable post-IPO share overhang.

Arun George

Tokyo Metro (9023 JP) IPO: The Bull Case

The bull case rests on a core high-quality asset, future growth drivers, top-quartile profitability, high FCF generation, and peer-leading dividend...

Arun George

Japan - Increase in Shorts & Potential Passive Selling in May

There are a bunch of stocks in Japan that could be sold by passive global investors in May. Shorts have increased on all stocks and the extent of...

Brian Freitas

Keisei Electric Rail (9009): Can Be Higher

Keisei Electric Railway Co's share price is rising in line with positive fundamentals, driven by a weak Yen, COVID rebound, and potential increase...

Henry Soediarko

Keisei Electric (9009): The Chinese Are Back.

The moment of truth is here, the Chinese are finally coming back to Japan. Keisei is one of the biggest beneficiaries of increased tourism in Japan.

Henry Soediarko

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Tokyo Metro (9023 JP) IPO: The Bear Case

The bear case rests on mid-tier revenue growth, low revenue diversification, the highest leverage among peers and a sizeable post-IPO share overhang.

Arun George

Tokyo Metro (9023 JP) IPO: The Bull Case

The bull case rests on a core high-quality asset, future growth drivers, top-quartile profitability, high FCF generation, and peer-leading dividend...

Arun George

Japan - Increase in Shorts & Potential Passive Selling in May

There are a bunch of stocks in Japan that could be sold by passive global investors in May. Shorts have increased on all stocks and the extent of...

Brian Freitas

Keisei Electric Rail (9009): Can Be Higher

​Keisei Electric Railway Co's share price is rising in line with positive fundamentals, driven by a weak Yen, COVID rebound, and potential increase...

Henry Soediarko

Keisei Electric (9009): The Chinese Are Back.

The moment of truth is here, the Chinese are finally coming back to Japan. Keisei is one of the biggest beneficiaries of increased tourism in Japan.

Henry Soediarko

Keisei Electric Railway Co's share price is rising in line with positive fundamentals, driven by a weak Yen, COVID rebound, and potential increase...