ECM Daily Briefs | Page 42 of 161

In today’s briefing:

Ventive Hospitality Pre-IPO Tearsheet
K Bank IPO: The Bear Case

Ventive Hospitality Pre-IPO Tearsheet

By Nicholas Tan

Ventive Hospitality Ltd (0807075D IN) is looking to raise up to US$238m in its upcoming India IPO. The deal will be run by JMF, Axis, HSBC, ICICI, IIFL, Kotak, SBI.
Ventive is the largest hospitality asset owner amongst public listed market peers and is focused primarily on luxury offerings across business and leisure in India and Maldives.
All of its hospitality assets are operated or franchised by renowned global operators i.e. Marriott, Hilton, Minor and Atmosphere.

K Bank IPO: The Bear Case

K Bank (279570 KS) is a Korean internet bank. It has launched an IPO to raise up to US$734 million.
In K Bank 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 rising competitive intensity, the smallest deposit base among Internet banks, below-peer loan book growth, and a high-risk crypto play due to the Dunamu partnership.

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Sep 21

Daily Brief ECM: Ather Energy Pre-IPO Tearsheet and more

In today’s briefing:

Ather Energy Pre-IPO Tearsheet

Ather Energy Pre-IPO Tearsheet

Ather Energy (1207922D IN) is looking to raise about US$536m in its upcoming India IPO. The deal will be run by HSBC, Nomura, JM Fin and Axis.
Ather is a pure play electric vehicle company in India designing and developing E2Ws, battery packs, charging infrastructure, associated software and accessories, also manufacturing battery packs and assembling E2Ws in-house.
According to CRISIL, Ather was the third largest player by volume of E2W sales in FY24.

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Sep 20

Daily Brief ECM: Kuaishou Placement – US$480m Secondary Block Deal a Small One to Digest and more

In today’s briefing:

Kuaishou Placement – US$480m Secondary Block Deal a Small One to Digest
Hexaware Technologies Pre-IPO Tearsheet
Intermestic IPO: A Proven Business Model with Improving Financials
Intermestic IPO – Steady Domestic Business, but Limited International Exposure
BioAge Labs Launches IPO Roadshow, Seeks To Raise Up To $150M on the Nasdaq Exchange

Kuaishou Placement – US$480m Secondary Block Deal a Small One to Digest

DCM Investments is looking to raise US$484m via selling its remaining stake in Kuaishou Technology (1024 HK).
While the current block deal isn’t entirely well flagged per se, it appears that DCM has since been trimming its stake on the open market.
In this note, we run the deal through our ECM framework and comment on deal dynamics.

Hexaware Technologies Pre-IPO Tearsheet

By Shifara Samsudeen, ACMA, CGMA

Hexaware Technologies (HEXW IN) is looking to raise about US$1.2bn in its upcoming India IPO. The deal will be run by JPM, Kotak, HSBC, IIFL Securities and Citi.
Hexaware Technologies is a global digital and technology services company delivering innovative solutions that help customers in their digital transformation journey and subsequent operations, as per the company.
Its offerings encompass five services, namely Design & Build, Secure & Run, Data & AI, Optimize, and Cloud Services.

Intermestic IPO: A Proven Business Model with Improving Financials

Japanese eyewear manufacturer and retailer, Intermestic (262A JP) has filed for an IPO on the Tokyo Stock Exchange and is planning to raise proceeds of $112m.
The company operates stores both domestically and internationally, and the company’s financials show strong improvement during the last few years.
Intermestic has not yet announced the terms for its IPO, and in this insight, we have discussed the company’s business models, outlook and financials.

Intermestic IPO – Steady Domestic Business, but Limited International Exposure

Intermestic (262A JP) is looking to raise US$110m in its Japan IPO. Intermestic is an eyewear manufacturer of eyeglasses and eyeglass accessories in Japan.
Utilizing a specialty store retailer of private label apparel (SPA) model, the firm aims to provide a one-stop shop whereby manufacturing and retailing of its products are handled in-house.
In this note, we look at the firm’s past performance.

BioAge Labs Launches IPO Roadshow, Seeks To Raise Up To $150M on the Nasdaq Exchange

By Andrei Zakharov

BioAge Labs launches roadshow and sets terms for an IPO: a company offers 7.5M shares at the price range of $17.00-$19.00, implying a market cap of ~$580M at the midpoint.
Sofinnova Venture Partners plans to purchase ~$15M worth of BioAge Labs shares in this offering. The shares are expected to begin trading on Nasdaq on September 26, 2024.
I view IPO valuation (post-offering EV ~$280M and runway into 2028) as attractive and expect BioAge Labs shares will outperform during first trading day next week.

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Sep 19

Daily Brief ECM: K Bank IPO: The Bull Case and more

In today’s briefing:

K Bank IPO: The Bull Case
Belstar Microfinance Pre-IPO – Accelerating Profitability Growth With A Diversified Network
Mr. D.I.Y Holding (Thailand) Pre-IPO Tearsheet
Pre-IPO Carote Ltd (PHIP Updates) – High Performance Growth May Not Be Sustainable
Hive Box – Pre-IPO: To Understand Who Pays and Why They Pay
K Bank IPO – The Negatives – Ample Issues Along with Crypto Exposure & Lockup

K Bank IPO: The Bull Case

K Bank (279570 KS) is a Korean internet bank. It has launched an IPO to raise up to US$734 million.
K Bank began operations in April 2017 as the first internet-only bank in Korea. KT Corp (030200 KS) and Woori Bank (000030 KS) are the two largest shareholders.
The bull case rests on rising market share, solid deposit growth, robust loan book growth, stable NIM, rising margins and a low NPL ratio.

Belstar Microfinance Pre-IPO – Accelerating Profitability Growth With A Diversified Network

Belstar Microfinance Ltd (3624918Z IN) is looking to raise around US$156m in its upcoming India IPO.
Belstar Microfinance is a non-banking finance company (NBFC) in India with a focus on furnishing micro-enterprise loans.
In this note, we talk about the company’s historical performance.

Mr. D.I.Y Holding (Thailand) Pre-IPO Tearsheet

By Nicholas Tan

Mr. DIY Holding (Thailand) (2472516D TB) (MRDIYT) is looking to raise as much as US$300m in its upcoming Thai IPO. The deal will be run by CIMB Thai Bank.
MRDIYT is the largest and fastest growing home improvement and general lifestyle retailer in Thailand, holding approximately 7.4% market share in 2023.
MRDIYT’s proposition is to offer competitive value for over 15,000 products across a variety of departments – hardware/tools, household appliances, electrical appliances, stationery, sporting goods, toys etc.

Pre-IPO Carote Ltd (PHIP Updates) – High Performance Growth May Not Be Sustainable

By Xinyao (Criss) Wang

Relying mainly on online channels and successful internationalization strategy, CAROTE’s performance growth showed strong momentum in recent years. However, after the short-term demand outbreak, future performance growth could slow down.
CAROTE adopts a product strategy similar to ZARA, launching a massive product matrix, constantly attracting consumers’ interest, but the innovation capability and core competitiveness of products are not high.
Valuation of CAROTE could be higher than Vesync (2148 HK).If Trump is elected, the friction/trade war between China and US may escalate, which is detrimental to CAROTE’s future valuation performance.

Hive Box – Pre-IPO: To Understand Who Pays and Why They Pay

By Ming Lu

Delivery workers would like to pay to save their time.
Retailers would also like to pay for return delivery to raise their service quality.
However, product buyers have to pay, but would not like to pay the delay fee.

K Bank IPO – The Negatives – Ample Issues Along with Crypto Exposure & Lockup

K Bank (279570 KS) plans to raise up to US$740m in its upcoming South Korean IPO.
K Bank is one of three Internet-only banks in Korea. It provides a full range of commercial banking products and services.
In this note, we talk about the not-so-positive aspects of the deal.

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Sep 18

Daily Brief ECM: Samvardhana Motherson QIP – Well Flagged US$780m QIP in a Decent Name and more

In today’s briefing:

Samvardhana Motherson QIP – Well Flagged US$780m QIP in a Decent Name
K Bank IPO Valuation Analysis
BioAge Labs IPO Preview: Investor Focus Has Turned To Azelaprag, A Huge Market Potential
K Bank IPO – The Positives – Fast Growth
Pre-IPO LinkChem Technology – The Business and the Concerns Behind

Samvardhana Motherson QIP – Well Flagged US$780m QIP in a Decent Name

Samvardhana Motherson International Ltd (MOTHERSO IN) is looking to raise up to US$780m in its QIP. Together with the offering is a US$270m compulsory convertible debenture (CCD) offering.
The deal is very well flagged, having gone through rounds of board/shareholder approvals. The QIP has also been covered by domestic media reports.
In this note, we run the deal through our ECM framework and comment on deal dynamics.

K Bank IPO Valuation Analysis

Our base case valuation of K Bank is target price of 9,151 won per share, which is 4% lower than the low end of the IPO price range.
Given the lack of upside in our target price relative to the IPO price range, we would avoid in subscribing to the IPO.
Our base case valuation is based on 1.6x P/B multiple using the company’s equity post IPO (2.35 trillion won).

BioAge Labs IPO Preview: Investor Focus Has Turned To Azelaprag, A Huge Market Potential

By Andrei Zakharov

BioAge Labs, a clinical-stage biopharma company backed by a leading syndicate of biotech investors, filed to go public in the United States.
Anti aging and obesity biopharma startup is purely focused on chronic metabolic diseases and established partner agreements with Amgen and Eli Lilly.
I have a positive view of upcoming BioAge Labs IPO and expect a strong first-day return above the IPO offer price.

K Bank IPO – The Positives – Fast Growth

K Bank (279570 KS) plans to raise up to US$740m in its upcoming South Korean IPO.
K Bank is one of three Internet-only banks in Korea. It provides a full range of commercial banking products and services.
In this note, we talk about the positive aspects of the deal.

Pre-IPO LinkChem Technology – The Business and the Concerns Behind

By Xinyao (Criss) Wang

The sudden high growth in 2023 was benefited from the cooperation with related party Shandong LinkChem. Is the performance growth driven by LinkChem’s reliance on related party transactions sustainable?
LinkChem relies heavily on limited number of customers to contribute performance but the customer stability is not strong.Due to “low voice” in front of customers, cash flow is under pressure.
The barrier of terbium chloride product is not high and LinkChem will face fierce competition in the future, leading to decreasing YoY growth revenue. Valuation should be lower than peers.

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Sep 17

Daily Brief ECM: Midea Group H Share Listing (300 HK): Trading Debut and more

In today’s briefing:

Midea Group H Share Listing (300 HK): Trading Debut
Auckland Airport Placement – Large NZ$1.4bn Raising, with ACC’s Overhang to Contend With
P N Gadgil Jewellers IPO Trading- Decent Anchor, Strong Insti Demand
Sung Woo IPO Preview
Sagility India Pre-IPO – Healthcare-Tech Exposure Although Alarming Concentration Risks to Watch For

Midea Group H Share Listing (300 HK): Trading Debut

Midea Group Co Ltd A (000333 CH) priced its H Share at HK$54.80 to raise HK$31,014 million (US$4.0 billion) in gross proceeds. The H Share will be listed tomorrow.
The H Share listing price implies an AH discount of 21.4% at the A Share price of RMB63.51. This compares to Haier Smart Home (6690 HK)‘s AH discount of 13.8%.
Futu grey market data shows that the H Shares closed 5.1% higher at HK$57.60. Our valuation analysis suggests that the H Share listing price is attractive.

Auckland Airport Placement – Large NZ$1.4bn Raising, with ACC’s Overhang to Contend With

Auckland Intl Airport (AIA NZ) is looking to raise NZ$1.4bn (US$863m) in its primary follow-on offering. The offering includes a NZ$1.2bn underwritten placement, together with a NZ$200m non-underwritten retail offer.
The underwritten placement alone is a large one for the stock to digest at 168 days of three month ADV.
In this note, we run the deal through our ECM framework and comment on deal dynamics.

P N Gadgil Jewellers IPO Trading- Decent Anchor, Strong Insti Demand

P N Gadgil Jewellers (1742652D IN) raised around US$130m in its India IPO.
It is an Indian organized jewellery player with product offerings which include traditional as well as modern and functional jewellery designs, in gold, diamond, silver and platinum.
In our previous notes, we looked at the company’s past performance and valuation. In this note, we talk about trading dynamics.

Sung Woo IPO Preview

Sung Woo is getting ready to complete its IPO in KOSDAQ in October 2024. Founded in 1992, Sung Woo produces components for cylindrical rechargeable battery, energy storage system, and automotive.
The IPO price range is from 25,000 won to 29,000 won. According to the bankers’ valuation, the expected market cap is 376 billion won to 436 billion won.
The book building for the institutional investors will be conducted from 10 to 16 October. The lead underwriter of this IPO is Korea Investment & Securities.

Sagility India Pre-IPO – Healthcare-Tech Exposure Although Alarming Concentration Risks to Watch For

Sagility India (2058883D IN) is looking to raise US$500m in its upcoming India IPO.
Sagility India is a pure-play healthcare focused solutions and services provider to Payers and Providers.
In this note, we look at the firm’s past performance.

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Sep 16

Daily Brief ECM: Midea Group: Offer Upsized at Top Tier. Updated Valuation Analysis and more

In today’s briefing:

Midea Group: Offer Upsized at Top Tier. Updated Valuation Analysis
Pre-IPO Midea Group H Share – Here Are the Risks Behind
Bajaj Housing Finance IPO – Valuation Might Get Stretched from Demand Overflow
ECM Weekly (16th Sep 2024) – Midea, Bajaj Housing, 99 Speed, P N Gadgil, Hozon, Trial, NextDC, Via

Midea Group: Offer Upsized at Top Tier. Updated Valuation Analysis

By Devi Subhakesan

Midea Group(000333 CH) has increased the shares on offer in Hong Kong by 15% to 565.9 million shares, priced at the top end of the range at HKD54.8 per share.
With strong investor interest, the company may exercise an over allotment option that could take the deal size to USD 4.6 billion.
Midea’s Hong Kong pricing reflects a nearly 21% discount to its A-share closing price, compared to the average 33% discount for dual-listed companies between Hong Kong and Shanghai or Shenzhen.

Pre-IPO Midea Group H Share – Here Are the Risks Behind

By Xinyao (Criss) Wang

For the reasons why Midea is eager to IPO in HK, investors shouldn’t just look at the surface of its glory, but delve into the “real motives” behind capital operations.
The policy of subsidizing the trade-in of home appliances belongs to “early overdraft of demand” and is unsustainable. Valuation logic for the performance increment brought by such policy is P/B.
If Midea cannot achieve the expected breakthroughs in To B business or internationalization in 2025-2026 to hedge against the weak domestic business, Midea’s performance/valuation in following years would inevitable decline.

Bajaj Housing Finance IPO – Valuation Might Get Stretched from Demand Overflow

Bajaj Housing Finance (BHF IN) raised around US$800m in its India IPO.
BHF is a non-deposit taking housing finance company engaged in mortgage lending since FY18. Its mortgage products include home loans, loans against property, lease rental discounting and developer financing.
In our previous notes, we looked at the company’s past performance and valuation. In this note, we will talk about the trading dynamics.

ECM Weekly (16th Sep 2024) – Midea, Bajaj Housing, 99 Speed, P N Gadgil, Hozon, Trial, NextDC, Via

Aequitas Research’s weekly update on the IPOs, placements, lockup expiry and other ECM linked events that were covered by the team over the past week.
On the IPO front, Midea Group Co Ltd A (000333 CH) hogged much of the limelight this week, although Bajaj Housing Finance (BHF IN) created some history as well.
We covered the Nextdc Ltd (NXT AU) and Terumo Corp (4543 JP) placements and looked at the possible deals in Trial Holdings (5882 JP) and Via Technologies (2388 TT).

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Sep 15

Daily Brief ECM: SHEIN and Temu: New Rule Could Crush “De Minimis” Imports | New Front In “War” Vs DTC Platforms and more

In today’s briefing:

SHEIN and Temu: New Rule Could Crush “De Minimis” Imports | New Front In “War” Vs DTC Platforms
K Bank IPO Preview
Weekly Deals Digest (15 Sep) – Midea, Seven & I, Raysum, Haitong/GJTA, Dyna-Mac
K-Bank’s IPO Details Out: Aggressive Pricing, but as a Crypto Play, It Might Surprise

SHEIN and Temu: New Rule Could Crush “De Minimis” Imports | New Front In “War” Vs DTC Platforms

By Daniel Hellberg

Biden Administration rule would make “de minimis” items subject to tariffs
Besides adding to landed cost of those items, reporting requirements would rise
In addition, US/EU governments launch probes of SHEIN/Temu product safety

K Bank IPO Preview

K Bank finally provided its IPO prospectus which includes more details of the IPO than what the company already announced about the IPO several days ago.
Bankers used KakaoBank, SBI Sumishin Net Bank, and Bancorp Inc as comps. Average PBR of 2.56x was used to value K Bank.
Some investors will question the inclusion of overseas comps including SBI Sumishin Net Bank and Bancorp in the valuation of K Bank.

Weekly Deals Digest (15 Sep) – Midea, Seven & I, Raysum, Haitong/GJTA, Dyna-Mac

A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
ECM developments: Midea Group Co Ltd A (000333 CH) upsized H Share listing, Terumo Corp (4543 JP) placement.
Event-Driven developments: Haitong Securities Co Ltd (H) (6837 HK)/Guotai Junan Securities (2611 HK), Seven & I Holdings (3382 JP), Raysum Co Ltd (8890 JP), Dyna Mac Holdings (DMHL SP).

K-Bank’s IPO Details Out: Aggressive Pricing, but as a Crypto Play, It Might Surprise

By Sanghyun Park

Compared to its overseas peers, K-Bank’s high valuation still stands out due to a significant gap in net income size relative to market cap.
The offering structure, with 50% secondary sales and weak lock-up commitments, means post-IPO float could spike to around 40%, making a stock price bump unlikely.
K-Bank’s crypto-focused model might attract investors valuing it as a crypto play, potentially influencing IPO pricing and post-listing stock performance.

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Sep 13

Daily Brief ECM: CR Beverage IPO: The Bear Case and more

In today’s briefing:

CR Beverage IPO: The Bear Case
Shuangdeng Group Pre-IPO Tearsheet
Duality Biotherapeutics (映恩生物) Pre-IPO: Too Early, Too Ambitious

CR Beverage IPO: The Bear Case

China Resources Beverage (CRB HK), China’s largest purified drinking water company, has received HK listing approval for a US$1 billion IPO.
In CR Beverage 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 core business’ pricing pressure, a slow pace of revenue diversification, a sizeable pre-IPO dividend, and margin and FCF generation below its key peer.

Shuangdeng Group Pre-IPO Tearsheet

Shuangdeng Group Co Ltd (JISHUZ CH) is looking to raise about US$150m in its upcoming Hong Kong IPO. The deal will be run by CICC, CCBI and Huatai.
Shuangdeng Group Co Ltd is engaged in energy storage business for big-data and telecommunication industries with a focus on design, R&D, manufacturing and sales of energy storage batteries and systems.
It was ranked first among global telecom base station and data-center energy storage battery providers in terms of shipment volume, achieving a 10.4% market share in 2023, according to F&S.

Duality Biotherapeutics (映恩生物) Pre-IPO: Too Early, Too Ambitious

By Ke Yan, CFA, FRM

Duality Biotherapeutics, a China-based clinical-stage biotechnology company, plans to raise up to US$300m via a Hong Kong listing.
In this note, we examine the company’s two core products, namely DB-1313 (HER2 ADC) and DB-1311 (B7-H3 ADC). We think the company’s products are not yet convincing.
While the management has expertise as biotech investors, biotech-related operational experience seems to be lacking.

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Sep 12

Daily Brief ECM: DAM Capital Pre-IPO Tearsheet and more

In today’s briefing:

DAM Capital Pre-IPO Tearsheet
The Born Korea IPO Valuation Vs Recent M&A Valuation of Compose Coffee by Jollibee Foods
Hozon New Energy Automobile Pre-IPO – The Negatives – Remains Far from Being Profitable
Trial Holdings IPO Lockup – Large Number of Small Holders Hold Around US$400m of Stock

DAM Capital Pre-IPO Tearsheet

DAM Capital (930970Z IN) is looking to raise at least US$100m in its upcoming India IPO. The deal will be run by Nuvama Wealth.
DAM Capital provides a range of financial solutions in investment banking comprising equity capital markets, mergers and acquisitions, private equity, structured finance advisory; and institutional equities comprising broking and research.
According to CRISIL, DAM Capital was the fastest growing investment bank in India by revenue CAGR from FY22-24 along with the highest profit margin in FY24.

The Born Korea IPO Valuation Vs Recent M&A Valuation of Compose Coffee by Jollibee Foods

In this insight, we compare the IPO valuation of The Born Korea (475560 KS) versus the recent M&A valuation of Compose Coffee by Jollibee Foods (JFC PM).
Using the recent M&A multiples of Compose Coffee by Jollibee Foods suggests an attractive upside to The Born Korea (relative to the IPO price range).
No other listed company in Korea has a restaurant business model that is consistently profitable, with strong balance sheet, and solid sales growth as The Born Korea.

Hozon New Energy Automobile Pre-IPO – The Negatives – Remains Far from Being Profitable

Hozon New Energy Automobile is looking to raise up to US$1bn in its upcoming HK IPO.
Hozon New Energy Automobile (HNEA) is a NEV technology company which sells cars under the Neta brand. The prices of its vehicles generally range between US$15,000 to US$45,000.
In this note, we talk about the not-so-positive aspects of the deal.

Trial Holdings IPO Lockup – Large Number of Small Holders Hold Around US$400m of Stock