In today’s briefing:
- [Japan ECM] Kokusai Elec (6525) – KKR’s Lock Up Expiry in 3 Weeks – $700mm Clean-Up Coming?
- Luxshare Precision A/H Listing – Earnings Growth and Stock Have Been Rebounding
- Genfleet (劲方医药) IPO: Trading Update
- Chery Auto IPO Valuation Analysis
- Butong Group IPO: Strong Momentum But Premium Hard To Justify
- Neptune Insurance Holdings Inc. (NP): Peeking at the IPO Prospectus of Specialty Risk Insurer
- Saatvik Green IPO – Making Hay While the Sun Shines on Valuations
- ArkBio (爱科百发) Pre-IPO: Early Signs of Success for Recycled Assets
- Netskope, Inc. (NTSK): Cybersecurity Leader Pops 21% on IPO After Pricing with Strength
- Pateo Connect Pre-IPO: PHIP Update: Growth Has Not Translated to Profits
[Japan ECM] Kokusai Elec (6525) – KKR’s Lock Up Expiry in 3 Weeks – $700mm Clean-Up Coming?
- Kokusai Electric (6525 JP) was IPOed too cheap in 2023 after a couple of years in the wilderness and an aborted private sale effort, blocked on antitrust grounds.
- It nearly tripled, there was an offering announced at ¥5,000+ priced ¥4,500+. Shares fell back to IPO price, then bounced, and we got a July follow-on offering at ¥3,000+.
- I suggested here the back end could be squeezy. It was for a hot minute, then it wasn’t. Now the stock is up 50% in 2 weeks. Watch out!
Luxshare Precision A/H Listing – Earnings Growth and Stock Have Been Rebounding
- Luxshare Precision Industry (002475 CH) (LP), a precision intelligent manufacturer, aims to raise around US$2bn in its H-share listing.
- LP provides cross-sector, vertically integrated development and intelligent manufacturing solutions—from components and modules to systems—for global clients across consumer electronics, automotive electronics, communication and data centers, and other end markets.
- In this note, we look at its past performance and other deal dynamics that might impact the listing.
Genfleet (劲方医药) IPO: Trading Update
- Genfleet raised HKD 1819m (USD 233m) from its global offering and will list on the Hong Kong Stock Exchange on Friday, September 18th.
- In our previous note, we looked at the company’s operation, management track records and discussed the IPO valuation.
- In this note, we provide an update for the IPO before trading debut.
Chery Auto IPO Valuation Analysis
- Our base case valuation of Chery Auto is target price of HKD 40.6 which is 32% higher than the high end of the IPO price range.
- Our base case valuation is based on EV/EBITDA of 5.9x our estimated EBITDA of 37.1 billion RMB in 2026. Our target multiple is 30% premium to the comps’ average multiple.
- We have chosen to use a premium valuation multiple mainly due to Chery Auto’s higher ROE, sales growth, and net margins vs the comps.
Butong Group IPO: Strong Momentum But Premium Hard To Justify
- Butong Group is looking to raise up to US$100m in its upcoming Hong Kong IPO.
- Butong has been able to achieve strong topline momentum of 57% CAGR from FY22 to FY24, whilst expanding its margins.
- We have looked at the company’s past performance in our previous note. In this note, we talk about valuations.
Neptune Insurance Holdings Inc. (NP): Peeking at the IPO Prospectus of Specialty Risk Insurer
- They offer a range of residential and commercial insurance products — including primary flood insurance, excess flood insurance, and parametric earthquake insurance — distributed through a nationwide network of agencies.
- They had revenue of $84.9 million and $119.3 million and net income of $17.9 million and $34.6 million in 2023 and 2024, respectively.
- Neptune Insurance Holdings is set to become the sixth insurance-related IPO of 2025.
Saatvik Green IPO – Making Hay While the Sun Shines on Valuations
- Time for another Solar Photovoltaic module manufacturer to list undeterred by the tepid listing for Vikram Solar
- Largely a commoditised business with a potential technological threat. Solar PV companies in India continue to trade at exceptional valuations of 20-30 times trailing EBITDA
- Saatvik, despite being smaller in scale vs peers and in face of intensifying competition is being priced at 14-15 times our FY27E EBITDA (peers trade at 14-16x)
ArkBio (爱科百发) Pre-IPO: Early Signs of Success for Recycled Assets
- ArkBio, a China-based near commercial stage biotech company, is looking to raise at least USD 100 million via a Hong Kong listing. JPM and CITIC are the joint sponsors.
- In this note, we look at the company’s core products, AK0529 and AK3280.
- We also look at the company’s pre-IPO investors and management team.
Netskope, Inc. (NTSK): Cybersecurity Leader Pops 21% on IPO After Pricing with Strength
- The company priced 47.8 million shares at $19.00, the high end of its upwardly revised $17–$19 range, before opening at $23.00 for a 21.0% premium to issue.
- The offering was classified as multiple-times oversubscribed –our sources saying north of 20-times oversubscribed– with strong participation from long-only funds and 1-on-1 conversions.
- Over the next month, the real test will be whether the stock avoids the all-too-common “sell the news” trend that’s hit many recent IPOs.
Pateo Connect Pre-IPO: PHIP Update: Growth Has Not Translated to Profits
- Pateo Connect Technology (PTC HK) is looking to raise around US$140m in its upcoming Hong Kong IPO.
- PTC is one of the largest domestic providers of smart cockpit and intelligent connectivity solutions in China.
- We have looked at the company’s past performance in our previous note. In this note, we will undertake a PHIP update.
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