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Smartkarma Daily Briefs

Sep 21
0

Daily Brief TMT/Internet: Nexon, Socionext, BYJU’S, Tencent Music, Godaddy Inc Class A, Trimble Navigation, Motorola Solutions and more

By | Daily Briefs, TMT/Internet

In today’s briefing:

  • Nexon (3659) | The Best Pipeline Ever
  • Socionext Pre-IPO Peer Comparison – Margins Have Been Weaker than Peers, but Gap Has Been Closing
  • India EdTech Woes: Waning Demand, Dried up Funding & Risk of Eroding Valuations
  • Tencent Music – Earnings Show Recovery but Do Not Rush to Make an Entry
  • GoDaddy Inc: Initiation of Coverage – Business Strategy
  • GoDaddy Inc: Detailed Credit Analysis & Financial Strength Evaluation Report
  • Trimble Inc: Detailed Credit Analysis & Financial Strength Evaluation Report
  • Trimble Inc: Initiation of Coverage – The Bilberry Acquisition & Other Drivers
  • Motorola Solutions Inc: Initiation of Coverage – Revenue Stickiness & Other Drivers
  • Motorola Solutions Inc: Detailed Credit Analysis & Financial Strength Evaluation Report

Nexon (3659) | The Best Pipeline Ever

By Mark Chadwick

  • Nexon’s stock price is down -20% from the highs made in April and -30% from its highs last year.
  • Nexon is a key beneficiary of the trend to immersive virtual worlds and live game operations
  • The best pipeline in Nexon’s history will drive higher Free Cash Flows and shareholder returns

Socionext Pre-IPO Peer Comparison – Margins Have Been Weaker than Peers, but Gap Has Been Closing

By Clarence Chu

  • Socionext (6526 JP) is looking to raise up to US$285m in its Japan IPO.  
  • Socionext is a fabless semiconductor provider which commenced operations after integrating the system on a chip (SoC) businesses of Fujitsu Semiconductor Limited and Panasonic Holding Corporation.
  • In this note, we undertake a peer comparison with its international peers, which have a similar fabless business model-type to that of Socionext’s

India EdTech Woes: Waning Demand, Dried up Funding & Risk of Eroding Valuations

By Devi Subhakesan

  • BYJU’S (1391510D IN), the world’s most valued online learning company, shocked the street with reported losses of USD576 mn on revenues of USD286 mn for the year ending March2021.
  • Post-Pandemic return to school has reset growth trajectory for India’s blooming EdTech sector that thrived during COVID times attracting multi-billion dollar valuations.
  • Industry wide layoffs and few shut downs have raised concerns on growth prospects for edTech players and sustainability of their boom period valuations. 

Tencent Music – Earnings Show Recovery but Do Not Rush to Make an Entry

By Shifara Samsudeen, ACMA, CGMA

  • TME’s shares are due to start trading on HKEx tomorrow once it carries out a secondary listing by introduction. The company neither issues new shares nor raise any proceeds.
  • The company’s earnings growth has started decelerating with having to end exclusive music licensing agreements with WMG, UMG and Sony Music a year ago as part of a SAMR probe.
  • TME’s 2Q2022 results show recovery in its earnings, however, we would recommend waiting until regulatory crackdown on tech platforms eases off.

GoDaddy Inc: Initiation of Coverage – Business Strategy

By Baptista Research

  • This is our first report on cloud-based solutions provider, GoDaddy.
  • The company is one of the largest players in the domains, hosting and other related cloud-based solutions space across the globe.
  • This quarter, the company launched its beta WooSaas solution, allowing it to reach larger customers.

GoDaddy Inc: Detailed Credit Analysis & Financial Strength Evaluation Report

By Baptista Research

  • GoDaddy is a cloud-based solutions provider and one of the largest players in the domains, hosting and other related cloud-based services.
  • The company is currently facing a challenging forex environment but this has not stopped them from delivering a positive result.
  • This quarter, the company launched its beta WooSaas solution, allowing it to reach larger customers.

Trimble Inc: Detailed Credit Analysis & Financial Strength Evaluation Report

By Baptista Research

  • Trimble Inc is a well-known player in the agri-tech space.
  • The company has gone through its fair share of corporate restructuring with a series of acquisitions and divestments.
  • On execution, Trimble continues to simplify its portfolio through actions like decreasing the number of product offerings and part numbers.

Trimble Inc: Initiation of Coverage – The Bilberry Acquisition & Other Drivers

By Baptista Research

  • This is our first report on agri-tech player, Trimble Inc.
  • The company has delivered a robust set of results this quarter with growth in total revenue and gross margin, with excellent progress seen on the Trimble Construction One offering.
  • From the perspective of capital allocation, Trimble has divested 5 businesses where the revenue was more than 90%.

Motorola Solutions Inc: Initiation of Coverage – Revenue Stickiness & Other Drivers

By Baptista Research

  • This is our first report on communications specialist, Motorola Solutions.
  • In services and software, Motorola’s revenue was up highlighted by robust software growth.
  • Motorola Solutions recently went on to acquire Videotec S.p.A, the global supplier of the ruggedized video security solutions.

Motorola Solutions Inc: Detailed Credit Analysis & Financial Strength Evaluation Report

By Baptista Research

  • Motorola Solutions is a renowned communications and analytics player and has a strong market position particularly in the land mobile radio (LMR) communications domain.
  • In the SI and product segments, continued strong order demand in both Video and LMR drives a high level of backlog.
  • Motorola strengthened its video portfolio with its acquisitions of Callipsa, which brought the company advanced cloud-native video analytics.

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Sep 21
0

Daily Brief Industrials: Keppel Corp, WCP, CALB and more

By | Daily Briefs, Industrials

In today’s briefing:

  • Straits Times Index Quiddity Leaderboard Mar 23: Sembcorp/Keppel Situation Could Cause Index Changes
  • WCP IPO: Order Table, Revised Terms, & Passive Flow Schedule
  • CALB IPO: What’s It Worth?

Straits Times Index Quiddity Leaderboard Mar 23: Sembcorp/Keppel Situation Could Cause Index Changes

By Janaghan Jeyakumar, CFA

  • The FTSE Straits Times Index (STI) (STI INDEX) has a quarterly rebalancing cycle with index reviews performed in March, June, September, and December every year.
  • The March and September reviews are complete index reviews while the June and December reviews are only for new listings. 
  • In this insight, we take a look at the potential index changes that can take place between now and the end of the March 2023 index review.

WCP IPO: Order Table, Revised Terms, & Passive Flow Schedule

By Sanghyun Park

  • WCP’s institutional subscription rate was 33.28 to 1, one of the lowest for an IPO this size. And nearly all orders sit below the lower end.
  • WCP set the price at ₩60,000, even lower than the floor, at an implied market cap of ₩2T. And the issuer also reduced the offering volume from 9M to 7.2M. 
  • Passive flows equivalent to about 3% of SO will likely flow into WCP by March next year. It is substantial enough to consider designing a flow trade setup.

CALB IPO: What’s It Worth?

By Arun George

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Sep 21
0

Most Read: Toshiba Corp, Porsche AG, Raysum Co Ltd, WCP, Keppel Corp, Leapmotor, Aier Eye Hospital Group, CALB and more

By | Daily Briefs, Most Read

In today’s briefing:

  • Toshiba (6502 JP) Getting Closer to Crunch Time So Ongoing News “Leaks” Likely
  • Porsche IPO Preview
  • Raysum (8890 JP) Mystery Bidder Is a Hedge Fund – And That Makes It More Interesting
  • WCP IPO: Final IPO Price Set, Still an Avoid
  • Straits Times Index Quiddity Leaderboard Mar 23: Sembcorp/Keppel Situation Could Cause Index Changes
  • Leapmotor IPO – Peers Recent Down Move Won’t Help
  • Leapmotor IPO: Valuation Insights
  • WCP IPO: Order Table, Revised Terms, & Passive Flow Schedule
  • Aier Eye Hospital (300015.CH) 22H1 – More Downside Ahead; The Long Logic Doesn’t Exist
  • CALB IPO: What’s It Worth?

Toshiba (6502 JP) Getting Closer to Crunch Time So Ongoing News “Leaks” Likely

By Travis Lundy

  • Three interviews and comments by Senior Toshiba Boardmembers (chairperson and head of Special Committee) and the CEO prep the ground for a full company deal, or no deal.
  • If no deal, there’s downside to the 5yr average Toshiba/Peers ratio. If you see 50% deal probability, at mid ¥6000s or better, IRRs are OK. But there is jump risk.
  • I don’t see the activists just deciding to bail en masse if no deal. I think they take it further, which means I think the Board wants a deal.

Porsche IPO Preview

By Douglas Kim

  • The Porsche IPO is expected to be the second largest IPO ever in Germany. Total proceeds from the IPO will be 18.1 billion to 19.5 billion euros.
  • The IPO price range is from 76.50 euros to 82.50 euros per share, which suggests a valuation of 70 billion to 75 billion euros.
  • After the IPO, Volkswagen will have an extraordinary shareholders meeting in December to propose to pay 49% of total proceeds to shareholders in early 2023 as a special dividend.

Raysum (8890 JP) Mystery Bidder Is a Hedge Fund – And That Makes It More Interesting

By Travis Lundy

  • Raysum Co Ltd (8890 JP) has been in a weird kind of limbo for well over a year. The Chairman/Founder resigned late last year for health reasons.
  • The company needed to take action to stay listed on TSE Standard. There was a plan to transfer 60+% of the shares to a foundation, through an odd arrangement.
  • Then a hedge fund stepped up and said “I’ll have 64% of the company at a near life-time high.” So now we have an interesting deal. And interesting potential future.

WCP IPO: Final IPO Price Set, Still an Avoid

By Arun George

  • WCP (WCP KS), a lithium-ion batteries separator company, has set its IPO price at KRW60,000 per share, a hefty 25-40% discount on the “desired” IPO price range of KRW80,000-100,000. 
  • The target raise has declined from KRW720-900 billion (US$517-646 million) to KRW432 billion (US$310 million) due to the lower IPO price and offer shares.
  • While the final IPO price is now reasonable, the process smacks desperation and calls into question the credibility of the syndicate’s forecasts. This is still an avoid.

Straits Times Index Quiddity Leaderboard Mar 23: Sembcorp/Keppel Situation Could Cause Index Changes

By Janaghan Jeyakumar, CFA

  • The FTSE Straits Times Index (STI) (STI INDEX) has a quarterly rebalancing cycle with index reviews performed in March, June, September, and December every year.
  • The March and September reviews are complete index reviews while the June and December reviews are only for new listings. 
  • In this insight, we take a look at the potential index changes that can take place between now and the end of the March 2023 index review.

Leapmotor IPO – Peers Recent Down Move Won’t Help

By Sumeet Singh

  • Leapmotor (LM) aims to raise around US$1.0bn in its Hong Kong IPO. LM is a smart EV company based in China, founded in 2015.
  • As of end Jun 22, it had delivered a total of 104,829 cars with most of its sales coming from its mini units, T03.
  • In this note, we will run the deal through our ECM framework and talk about valuations.

Leapmotor IPO: Valuation Insights

By Arun George

WCP IPO: Order Table, Revised Terms, & Passive Flow Schedule

By Sanghyun Park

  • WCP’s institutional subscription rate was 33.28 to 1, one of the lowest for an IPO this size. And nearly all orders sit below the lower end.
  • WCP set the price at ₩60,000, even lower than the floor, at an implied market cap of ₩2T. And the issuer also reduced the offering volume from 9M to 7.2M. 
  • Passive flows equivalent to about 3% of SO will likely flow into WCP by March next year. It is substantial enough to consider designing a flow trade setup.

Aier Eye Hospital (300015.CH) 22H1 – More Downside Ahead; The Long Logic Doesn’t Exist

By Xinyao (Criss) Wang

  • The fundamental changes in the population structure will lead to a decline in the growth rate of the total retail sales of consumer goods. The long logic doesn’t exist.
  • Aier has hit a growth ceiling. As the endogenous demand will be stepped downward gradually, the performance of Aier will further decline. The downward elasticity of valuation is greater.
  • It is still difficult for healthcare sector to have its own independent growth logic. The bottom of healthcare sector would appear after the collapse of Aier’s valuation.

CALB IPO: What’s It Worth?

By Arun George

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Sep 20
0

Daily Brief Singapore: Pfizer Inc, Splunk Inc, Under Armour and more

By | Daily Briefs, Singapore

In today’s briefing:

  • Pfizer Inc.: The Global Blood Therapeutics Acquisition & Other Drivers
  • Splunk Inc: Enhancement Of The Partnerverse Program & Other Developments
  • Under Armour Inc: Digital Strategy & Other Drivers

Pfizer Inc.: The Global Blood Therapeutics Acquisition & Other Drivers

By Baptista Research

  • While operating in a difficult foreign exchange environment, Pfizer maintained a good operational performance in the second quarter and delivered an all-around beat, exceeding Wall Street expectations on all counts.
  • The chance of a future variety that combines the severity of the original virus with the contagiousness of Omicron nevertheless persists.
  • Among major updates, Pfizer went on to acquire Global Blood Therapeutics to strengthen its commitment to sickle cell disease.

Splunk Inc: Enhancement Of The Partnerverse Program & Other Developments

By Baptista Research

  • Splunk had a robust set of results with a top-line outperformance and it also exceeded the operating margin and earnings expectations for the quarter.
  • Positive consumer engagement was seen by the management with robust competitive win rates, good business momentum, and a high net retention rate.
  • In spite of the solid top and bottom line, the total ARR and cloud ARR came short of management expectations.

Under Armour Inc: Digital Strategy & Other Drivers

By Baptista Research

  • Under Armour’s brand strength helped the company deliver an all-around beat while navigating the present environment.
  • The company’s financial performance has been decent as its wholesale revenue increased while the eCommerce revenue and direct-to-consumer revenue decreased.
  • The company is planning to launch a new footwear platform, Kevin, that can change the landscape of athletic footwear.

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Sep 20
0

Daily Brief Australia: OZ Minerals Ltd, Link Administration and more

By | Australia, Daily Briefs

In today’s briefing:

  • OZ Minerals May Be Narrowing the Price Gap to a BHP Deal
  • Link’s On Again-Off Again Scheme Is All but Off

OZ Minerals May Be Narrowing the Price Gap to a BHP Deal

By Travis Lundy

  • Six+ weeks ago, BHP Group Ltd (BHP AU) approached OZ Minerals Ltd (OZL AU) with a bid of A$25/share. Oz very quickly rejected it and said it was worth more.
  • The back and forth immediately post-rejection was not conciliatory. My expectation was that if they came back quickly, they’d have to pay A$30. But coming back quickly was tough.
  • There are hints now that may be the price. But it may not be. It will take time. 

Link’s On Again-Off Again Scheme Is All but Off

By Arun George

  • Dye & Durham/DND has proposed a revised Link Administration (LNK AU) offer to address any FCA redress payments. Around A$1.00 per share will hang on the outcome of the FCA investigation.
  • The Link Board has said it cannot recommend the revised proposal based on value, structure and alternatives available to Link. We agree with the Board’s view.
  • The scheme is all but dead. The shares are now a back-end play and remain attractive for value investors.

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Sep 20
0

Daily Brief United States: Etsy Inc, Ethereum, Broadcom Limited, Best Buy Co Inc, Hewlett Packard Co, Uber, Match Group Inc, Autodesk Inc, Agilent Technologies, Freeport Mcmoran and more

By | Daily Briefs, United States

In today’s briefing:

  • Etsy Inc: New Purchase Protection Feature & Other Developments
  • Post-Merge Market Mayhem
  • Broadcom Inc: Collaboration With Dell & Other Drivers
  • Best Buy Inc: New Small Format Digital-First Store & Other Drivers
  • HP Inc.: Weakened Macro & Other Developments
  • Uber Technologies: AV-Based Food Delivery Pilot & Other Developments
  • Match Group: The League Acquisition & Other Drivers
  • Autodesk Inc: Introduction of AutoCAD Web & Other Drivers
  • Agilent Technologies: New Launches In Mass Spectrometry & Other Drivers
  • Freeport-McMoran Inc: New Mining Technologies & Other Drivers

Etsy Inc: New Purchase Protection Feature & Other Developments

By Baptista Research

  • Etsy recently launched the Etsy Purchase Protection program where buyers will get a total refund for purchases they make on Etsy.com in cases that do not match the item description, never arrive, or arrive damaged.
  • This new program aims at making shopping on the website more worry-free.
  • The purchase Protection Program of Etsy will complement the company’s brand efforts in improving customer support, maintaining integrity in its marketplace as a destination for special and unique items, and increasing trust signals over the user experience.

Post-Merge Market Mayhem

By Kaiko

  • Price Movements: ETH is down 25% on the week despite the successful completion of the Merge.
  • Market Liquidity: The U.S. dollar remains the dominant fiat currency in crypto, possessing 70% of total fiat trade volume.
  • Derivatives: ETH funding rates have returned to neutral after dipping to all time lows of less than -0.4%. 

Broadcom Inc: Collaboration With Dell & Other Drivers

By Baptista Research

  • Broadcom reported an all-around beat in the quarter with an increase in revenues in semiconductor solutions and infrastructure software.
  • Service and cloud provider growth remained strong in the quarter, driven by infrastructural upgrades and data center build-outs.
  • As both enterprise and cloud data centers refresh, they continue to increase the adoption of the company’s Jericho, Trident, and Tomahawk switching silicon platforms.

Best Buy Inc: New Small Format Digital-First Store & Other Drivers

By Baptista Research

  • Best Buy delivered a decent result this quarter surpassing Wall Street expectations on all counts.
  • Best Buy is also viewing more interest in the sales events such as tax-free events, prime day, and other events that are geared at an exceptional value.
  • Best Buy also opened new outlet stores, finished store remodels, and started to implement newly signed deals with healthcare companies.

HP Inc.: Weakened Macro & Other Developments

By Baptista Research

  • HP Inc also had a significantly below par result along with its rival, Dell Technologies as the industry cycle has commenced its downward trend after the huge upswing during the pandemic.
  • The results of this quarter were impacted by macroeconomic challenges, which included a significant slowdown in consumer demand to geopolitical, currency, and inflation challenges.
  • Recently, the company introduced its HP Instant Ink for its small business and its innovative LaserJet Pro with HP+.

Uber Technologies: AV-Based Food Delivery Pilot & Other Developments

By Baptista Research

  • Uber Technologies delivered a mixed quarterly result with revenues above expectations resulting from an increase in the annualized run rate and gross bookings.
  • The company failed to meet market expectations on the earnings front as a result of considerable forex challenges through it did generate a positive free cash flow.
  • The top-line growth of the company continues to be durable and the onboarding process has shown a significant improvement.

Match Group: The League Acquisition & Other Drivers

By Baptista Research

  • Match Group had a weak quarter with a below-par growth in the total revenue that resulted in the company failing to meet Wall Street expectations.
  • The direct revenue of the company grew in the U.S with strength at Tinder, Chipsa, BLK, and Hinge.
  • Additions of Tinder payers came in addition, while the established brands of the company, including Match Infinity brands and Match, Plenty of Fish, OkCupid, and Meetic, declined more than 10% in total.

Autodesk Inc: Introduction of AutoCAD Web & Other Drivers

By Baptista Research

  • Autodesk reported a solid quarter in terms of revenue, free cash flow, and non-GAAP operating margin.
  • The end market’s demand remained strong for the company and it delivered another all-around beat.
  • Among key developments, Autodesk introduced AutoCAD Web, a new combined subscription to AutoCAD Web and AutoCAD Mobile from Autodesk with improved access to drawings.

Agilent Technologies: New Launches In Mass Spectrometry & Other Drivers

By Baptista Research

  • Agilent Technologies delivered an excellent quarterly result with earnings and revenue exceeding market expectations significantly.
  • The strong results were led by strength in its biggest markets i.e., chemical, energy, and pharma.
  • We provide the stock of Agilent Technologies with a ‘Hold’ rating with a revision in the target price.

Freeport-McMoran Inc: New Mining Technologies & Other Drivers

By Baptista Research

  • Freeport delivered a disappointing result and failed to meet Wall Street expectations on all counts but the future outlook remains optimistic.
  • The company is increasing production year over year, and controlling expenses in a difficult environment and benefits from a highly favorable macro for copper.
  • With an expected rise in demand for copper with respect to energy conservation especially in EVs, the company benefits from a positive future macro.

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Sep 20
0

Daily Brief China: Onewo Space-Tech, Meituan, Aier Eye Hospital Group, CPMC Holdings, Country Garden Holdings Co and more

By | China, Daily Briefs

In today’s briefing:

  • Onewo Space-Tech IPO – Appears Digestible Even on Conservative Assumptions
  • Meituan (3690 HK): User Base Beating Competitor, Industry Recovering, Upgrade to Hold
  • Aier Eye Hospital (300015.CH) 22H1 – More Downside Ahead; The Long Logic Doesn’t Exist
  • CPMC Holdings (906 HK): Good Time to Re-Visit
  • Morning Views Asia: China Vanke, Country Garden Holdings Co

Onewo Space-Tech IPO – Appears Digestible Even on Conservative Assumptions

By Sumeet Singh

  • Onewo Space-Tech (ONEWO HK) (OST) aims to raise upto US$784m in its Hong Kong IPO. OST is a property management service provider primarily owned by China Vanke (2202 HK). 
  • As per Frost & Sullivan, amongst the residential community service providers in China, OST ranked first. It also ranked first in the commercial space integrated services market in China.
  • In this note, we will run the deal through our ECM framework and talk about valuations.

Meituan (3690 HK): User Base Beating Competitor, Industry Recovering, Upgrade to Hold

By Ming Lu

  • In July, Meituan’s user base exceeded Ele.me and Ele.me’s active user base decreased by 24% YoY.
  • In China, Monthly active user bases of local life and food delivery recovered from May to July.
  • We believe Meituan’s stock has only a downside of 6% for year end 2023.

Aier Eye Hospital (300015.CH) 22H1 – More Downside Ahead; The Long Logic Doesn’t Exist

By Xinyao (Criss) Wang

  • The fundamental changes in the population structure will lead to a decline in the growth rate of the total retail sales of consumer goods. The long logic doesn’t exist.
  • Aier has hit a growth ceiling. As the endogenous demand will be stepped downward gradually, the performance of Aier will further decline. The downward elasticity of valuation is greater.
  • It is still difficult for healthcare sector to have its own independent growth logic. The bottom of healthcare sector would appear after the collapse of Aier’s valuation.

CPMC Holdings (906 HK): Good Time to Re-Visit

By Osbert Tang, CFA

  • Underpinned by higher ASP and sequentially lower input costs, CPMC Holdings (906 HK) should achieve better margin in 2H22. Its 17% fall in share price YTD makes it appealing.
  • Average aluminum price was down 14% so far in 2H22, vs. 1H21, good to its costs. Well-controlled selling and administrative costs will help to support profitability recovery.
  • New two-piece can capacity will grow by 54% over the next three years as 5 production lines are expected to be added. Most of them already have demand lined up.

Morning Views Asia: China Vanke, Country Garden Holdings Co

By Charles Macgregor

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

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Sep 20
0

Daily Brief South Korea: WCP, Jyp Entertainment, Hyundai Greenfood and more

By | Daily Briefs, South Korea

In today’s briefing:

  • WCP IPO: Final IPO Price Set, Still an Avoid
  • Smartkarma Webinar | ESG Risks in Korea
  • Trading Angles of Hyundai Green Food Demerger, with Potential Tender & Hive-Off

WCP IPO: Final IPO Price Set, Still an Avoid

By Arun George

  • WCP (WCP KS), a lithium-ion batteries separator company, has set its IPO price at KRW60,000 per share, a hefty 25-40% discount on the “desired” IPO price range of KRW80,000-100,000. 
  • The target raise has declined from KRW720-900 billion (US$517-646 million) to KRW432 billion (US$310 million) due to the lower IPO price and offer shares.
  • While the final IPO price is now reasonable, the process smacks desperation and calls into question the credibility of the syndicate’s forecasts. This is still an avoid.

Smartkarma Webinar | ESG Risks in Korea

By Smartkarma Research

In our next Webinar, we welcome Analyst Soo Young Kim , who will take us through the ESG risks present in South Korea and her analysis based on negative ESG incidents. 

The webinar will be hosted on Wednesday, 21 September 2022, 17:00 SGT/HKT.

Soo Young is the Head of ESG Intelligence at Who’s Good, Asia’s first AI-driven ESG Insight Provider. Using AI technologies and public data, Who’s Good provides objective and up-to-date corporate ESG insights on Asian companies.

Trading Angles of Hyundai Green Food Demerger, with Potential Tender & Hive-Off

By Sanghyun Park

  • The value accretion that will occur by unlocking treasury shares will be more significant than Hyundai Dept. The treasury shares account for 10.64%, compared with 6.61% for Hyundai Dept.
  • Neither Holdco nor Opco will likely remain in the KOSPI 200 after relisting. So we cannot expect PASSIVE inflow at the time of relisting.
  • A tender will likely follow. However, neither is available for shorting. So, we should use Opco’s overheated price adjustment as an exit timing for our positions aimed at value accretion.

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Sep 20
0

Daily Brief ECM: Onewo Space-Tech IPO – Appears Digestible Even on Conservative Assumptions and more

By | Daily Briefs, ECM

In today’s briefing:

  • Onewo Space-Tech IPO – Appears Digestible Even on Conservative Assumptions
  • WCP IPO: Final IPO Price Set, Still an Avoid
  • Porsche IPO Preview
  • Broadcom Inc: Collaboration With Dell & Other Drivers
  • Etsy Inc: New Purchase Protection Feature & Other Developments
  • HP Inc.: Weakened Macro & Other Developments
  • Best Buy Inc: New Small Format Digital-First Store & Other Drivers
  • Uber Technologies: AV-Based Food Delivery Pilot & Other Developments
  • Autodesk Inc: Introduction of AutoCAD Web & Other Drivers
  • Freeport-McMoran Inc: New Mining Technologies & Other Drivers

Onewo Space-Tech IPO – Appears Digestible Even on Conservative Assumptions

By Sumeet Singh

  • Onewo Space-Tech (ONEWO HK) (OST) aims to raise upto US$784m in its Hong Kong IPO. OST is a property management service provider primarily owned by China Vanke (2202 HK). 
  • As per Frost & Sullivan, amongst the residential community service providers in China, OST ranked first. It also ranked first in the commercial space integrated services market in China.
  • In this note, we will run the deal through our ECM framework and talk about valuations.

WCP IPO: Final IPO Price Set, Still an Avoid

By Arun George

  • WCP (WCP KS), a lithium-ion batteries separator company, has set its IPO price at KRW60,000 per share, a hefty 25-40% discount on the “desired” IPO price range of KRW80,000-100,000. 
  • The target raise has declined from KRW720-900 billion (US$517-646 million) to KRW432 billion (US$310 million) due to the lower IPO price and offer shares.
  • While the final IPO price is now reasonable, the process smacks desperation and calls into question the credibility of the syndicate’s forecasts. This is still an avoid.

Porsche IPO Preview

By Douglas Kim

  • The Porsche IPO is expected to be the second largest IPO ever in Germany. Total proceeds from the IPO will be 18.1 billion to 19.5 billion euros.
  • The IPO price range is from 76.50 euros to 82.50 euros per share, which suggests a valuation of 70 billion to 75 billion euros.
  • After the IPO, Volkswagen will have an extraordinary shareholders meeting in December to propose to pay 49% of total proceeds to shareholders in early 2023 as a special dividend.

Broadcom Inc: Collaboration With Dell & Other Drivers

By Baptista Research

  • Broadcom reported an all-around beat in the quarter with an increase in revenues in semiconductor solutions and infrastructure software.
  • Service and cloud provider growth remained strong in the quarter, driven by infrastructural upgrades and data center build-outs.
  • As both enterprise and cloud data centers refresh, they continue to increase the adoption of the company’s Jericho, Trident, and Tomahawk switching silicon platforms.

Etsy Inc: New Purchase Protection Feature & Other Developments

By Baptista Research

  • Etsy recently launched the Etsy Purchase Protection program where buyers will get a total refund for purchases they make on Etsy.com in cases that do not match the item description, never arrive, or arrive damaged.
  • This new program aims at making shopping on the website more worry-free.
  • The purchase Protection Program of Etsy will complement the company’s brand efforts in improving customer support, maintaining integrity in its marketplace as a destination for special and unique items, and increasing trust signals over the user experience.

HP Inc.: Weakened Macro & Other Developments

By Baptista Research

  • HP Inc also had a significantly below par result along with its rival, Dell Technologies as the industry cycle has commenced its downward trend after the huge upswing during the pandemic.
  • The results of this quarter were impacted by macroeconomic challenges, which included a significant slowdown in consumer demand to geopolitical, currency, and inflation challenges.
  • Recently, the company introduced its HP Instant Ink for its small business and its innovative LaserJet Pro with HP+.

Best Buy Inc: New Small Format Digital-First Store & Other Drivers

By Baptista Research

  • Best Buy delivered a decent result this quarter surpassing Wall Street expectations on all counts.
  • Best Buy is also viewing more interest in the sales events such as tax-free events, prime day, and other events that are geared at an exceptional value.
  • Best Buy also opened new outlet stores, finished store remodels, and started to implement newly signed deals with healthcare companies.

Uber Technologies: AV-Based Food Delivery Pilot & Other Developments

By Baptista Research

  • Uber Technologies delivered a mixed quarterly result with revenues above expectations resulting from an increase in the annualized run rate and gross bookings.
  • The company failed to meet market expectations on the earnings front as a result of considerable forex challenges through it did generate a positive free cash flow.
  • The top-line growth of the company continues to be durable and the onboarding process has shown a significant improvement.

Autodesk Inc: Introduction of AutoCAD Web & Other Drivers

By Baptista Research

  • Autodesk reported a solid quarter in terms of revenue, free cash flow, and non-GAAP operating margin.
  • The end market’s demand remained strong for the company and it delivered another all-around beat.
  • Among key developments, Autodesk introduced AutoCAD Web, a new combined subscription to AutoCAD Web and AutoCAD Mobile from Autodesk with improved access to drawings.

Freeport-McMoran Inc: New Mining Technologies & Other Drivers

By Baptista Research

  • Freeport delivered a disappointing result and failed to meet Wall Street expectations on all counts but the future outlook remains optimistic.
  • The company is increasing production year over year, and controlling expenses in a difficult environment and benefits from a highly favorable macro for copper.
  • With an expected rise in demand for copper with respect to energy conservation especially in EVs, the company benefits from a positive future macro.

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Sep 20
0

Daily Brief ESG: Smartkarma Webinar | ESG Risks in Korea and more

By | Daily Briefs, ESG

In today’s briefing:

  • Smartkarma Webinar | ESG Risks in Korea

Smartkarma Webinar | ESG Risks in Korea

By Smartkarma Research

In our next Webinar, we welcome Analyst Soo Young Kim , who will take us through the ESG risks present in South Korea and her analysis based on negative ESG incidents. 

The webinar will be hosted on Wednesday, 21 September 2022, 17:00 SGT/HKT.

Soo Young is the Head of ESG Intelligence at Who’s Good, Asia’s first AI-driven ESG Insight Provider. Using AI technologies and public data, Who’s Good provides objective and up-to-date corporate ESG insights on Asian companies.

💡 Before it’s here, it’s on Smartkarma

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