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.

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/nidec-corp" target="_blank" data-smartkarma-citation="entities:7245:1" rel="noopener">Nidec Corp (6594 JP)</a> announced a hostile preconditional tender offer for <a href="https://www.smartkarma.com/entities/makino-milling-machine-co" target="_blank" data-smartkarma-citation="entities:5200:1" rel="noopener">Makino Milling Machine Co (6135 JP)</a> at JPY11,000 per share, an 18.9% premium to the last close.</li>
<li>The offer is preconditioned on several regulatory approvals. It is scheduled to start on 4 April, even if the Board does not recommend it. </li>
<li>The Board has three options: engage to facilitate a friendly offer, find a white knight bidder and launch an ambitious MTM plan to thwart the offer. </li>
</ul>



Nidec Corp (6594 JP) announced a hostile preconditional tender offer for Makino Milling Machine Co (6135 JP) at JPY11,000 per share, an 18.9% premium to the last close.
The offer is preconditioned on several regulatory approvals. It is scheduled to start on 4 April, even if the Board does not recommend it. 
The Board has three options: engage to facilitate a friendly offer, find a white knight bidder and launch an ambitious MTM plan to thwart the offer. 


Makino Milling Machine (6135 JP): Nidec’s (6594 JP) Hostile Preconditional Tender Offer at JPY11,000

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

<ul>
<li>
<a href="https://www.smartkarma.com/entities/fujikura-ltd" target="_blank" data-smartkarma-citation="entities:10768:1" rel="noopener">Fujikura Ltd (5803 JP)</a> could be added to a global index at the end of November and there will be a lot of buying in the stock.</li>
<li>Following the rally in the stock, <a href="https://www.smartkarma.com/entities/fujikura-ltd" target="_blank" data-smartkarma-citation="entities:10768:1" rel="noopener">Fujikura Ltd (5803 JP)</a> trades expensive to the average and median of its peers on most valuation metrics.</li>
<li>The increase in cumulative excess volume in <a href="https://www.smartkarma.com/entities/fujikura-ltd" target="_blank" data-smartkarma-citation="entities:10768:1" rel="noopener">Fujikura Ltd (5803 JP)</a> over the last 3 months far outpaces the increase in its peers.</li>
</ul>



Fujikura Ltd (5803 JP) could be added to a global index at the end of November and there will be a lot of buying in the stock.
Following the rally in the stock, Fujikura Ltd (5803 JP) trades expensive to the average and median of its peers on most valuation metrics.
The increase in cumulative excess volume in Fujikura Ltd (5803 JP) over the last 3 months far outpaces the increase in its peers.


Fujikura (5803 JP): Positioning & Potential Passive Buying

Japanese Equity Specialist, Ortus Advisors

Andrew Jackson

Japanese Equity Specialist

Ortus Advisors

Thematic (Sector/Industry)

<ul>
<li>US semis and tech related setting a bullish tone for JP SPE with NVDA closing at record highs.</li>
<li>Steep drop for oil to hit Japex, Index and refiners while US P&amp;C strength should also be reflected in JP peers.</li>
<li>Possible downside for Fujitsu with NTT Docomo announcing a pivot away from their base station equipment.</li>
</ul>


US semis and tech related setting a bullish tone for JP SPE with NVDA closing at record highs.
Steep drop for oil to hit Japex, Index and refiners while US P&amp;C strength should also be reflected in JP peers.
Possible downside for Fujitsu with NTT Docomo announcing a pivot away from their base station equipment.


Japan Morning Connection: US Semis and Tech Set a Bullish Tone for Japan's SPE Majors

<ul>
<li>Japan to follow US higher on the much better-than-expected jobs report and the yen back to 148.9</li>
<li>Exporters including the Autos with high US exposures as well as Inbound related laggards such as Isetan Mitsukoshi and Shiseido/Kose should see sentiment improve</li>
<li>The strong US data should also help the JP Shippers rebound after dropping -8.2% on Fri on the end of the US port workers strike</li>
</ul>


Japan to follow US higher on the much better-than-expected jobs report and the yen back to 148.9
Exporters including the Autos with high US exposures as well as Inbound related laggards such as Isetan Mitsukoshi and Shiseido/Kose should see sentiment improve
The strong US data should also help the JP Shippers rebound after dropping -8.2% on Fri on the end of the US port workers strike


Japan Morning Connection: Expect Rebound After Strong US Job Data

Equity Analyst, LightStream Research

Shifara Samsudeen, FCMA, CGMA

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 Capital Markets

Midea Group Co Ltd A / Equity Capital Markets

<ul>
<li>Chinese home appliance maker Midea has announced the terms for its IPO. The company plans to raise $3.46bn at an indicative price range of HK$52.0-54.8 per share.</li>
<li>The company has a diversified product portfolio, well-balanced exposure to domestic as well as overseas markets and a growing robotics business.</li>
<li>As we expected, the HK offering is priced at around 25% discount to it’s A-shares and our analysis suggests that Midea’s HK offering is priced attractively. </li>
</ul>


Chinese home appliance maker Midea has announced the terms for its IPO. The company plans to raise $3.46bn at an indicative price range of HK$52.0-54.8 per share.
The company has a diversified product portfolio, well-balanced exposure to domestic as well as overseas markets and a growing robotics business.
As we expected, the HK offering is priced at around 25% discount to it’s A-shares and our analysis suggests that Midea’s HK offering is priced attractively. 


Japan

YASKAWA Electric Corporation manufactures and markets servomotors, controllers, inverters, and industrial robots.  The Company's products include spindle controllers, computerized numerical control (CNC) systems, and system engineering.

Price Gauge
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Yaskawa Electric (6506 JP)

Makino Milling Machine (6135 JP): Nidec’s (6594 JP) Hostile Preconditional Tender Offer at JPY11,000

The Board has three options: engage to facilitate a friendly offer, find a white knight bidder and launch an ambitious MTM plan to thwart the offer.

Arun George

Fujikura (5803 JP): Positioning & Potential Passive Buying

The increased market cap could lead to Fujikura being added to passive portfolios at the end of Nov. Positioning in the stock is larger than in...

Brian Freitas

Japan Morning Connection: US Semis and Tech Set a Bullish Tone for Japan's SPE Majors

US semiconductors and tech related setting a bullish tone for JP SPE. Steep drop in oil to hit Japex, Index and refiners. Fujitsu may face downside...

Andrew Jackson

Japan Morning Connection: Expect Rebound After Strong US Job Data

Japan's market is expected to rise following the US jobs report, benefiting exporters and shippers after a recent drop.

Andrew Jackson

Midea HK Listing: Valuation Insights

As per news media outlets, Midea's HK listing will be priced at the top of the indicative IPO price range and due to strong demand (books are...

Shifara Samsudeen, FCMA, CGMA

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Makino Milling Machine (6135 JP): Nidec’s (6594 JP) Hostile Preconditional Tender Offer at JPY11,000

The Board has three options: engage to facilitate a friendly offer, find a white knight bidder and launch an ambitious MTM plan to thwart the offer.

Arun George

Fujikura (5803 JP): Positioning & Potential Passive Buying

The increased market cap could lead to Fujikura being added to passive portfolios at the end of Nov. Positioning in the stock is larger than in...

Brian Freitas

Japan Morning Connection: US Semis and Tech Set a Bullish Tone for Japan's SPE Majors

US semiconductors and tech related setting a bullish tone for JP SPE. Steep drop in oil to hit Japex, Index and refiners. Fujitsu may face downside...

Andrew Jackson

Japan Morning Connection: Expect Rebound After Strong US Job Data

​Japan's market is expected to rise following the US jobs report, benefiting exporters and shippers after a recent drop.

Andrew Jackson

Midea HK Listing: Valuation Insights

As per news media outlets, Midea's HK listing will be priced at the top of the indicative IPO price range and due to strong demand (books are...

Shifara Samsudeen, FCMA, CGMA

Japan's market is expected to rise following the US jobs report, benefiting exporters and shippers after a recent drop.