In today’s briefing:
- GOME Retail Placement: The Crisis Persists
- Weilong Delicious IPO: In a Pickle
- Soosan Industries Pre-IPO – Improving Margins and Other Segments Could Lift the Coal Overhang
- SOCAR IPO Post-Listing Flow: VC-Triggered Overhang Vs. Lotte’s Counter Move
- Pre-IPO Rainmed Medical – The Industry, the Business and the Concerns
GOME Retail Placement: The Crisis Persists
- As the mismatch between short-term assets and liabilities expands, GOME is raising HK$776.5m at HK$0.40 per-share, which is a 12.1% discount to the closing price on 27th June 2022.
- This is clearly insufficient to pay down GOME Retail Holdings (493 HK)‘s RMB 40.0bn short term debt and accounts payable obligations falling due in the next 12 months.
- With the omni-channel transformation taking longer than expected to turn around performance, the company might find it difficult to refinance the debt and maintain the supply chain as usual.
Weilong Delicious IPO: In a Pickle
- Weilong Delicious Global (WDG HK) has refiled its PHIP with an aim to raise US$500 million, half of its previous ambition to raise US$1 billion.
- We have previously discussed the IPO in Weilong Delicious IPO Initiation: Tasty Bite and Weilong Delicious IPO: Mixed Update.
- The PHIP which discloses the 2021 results and recent developments point to reducing growth rates and cost pressures. We would pass on the IPO.
Soosan Industries Pre-IPO – Improving Margins and Other Segments Could Lift the Coal Overhang
- Soosan Industries (126720 KS) is looking to raise about US$189m in its upcoming Korean IPO.
- Soosan Industries (SSI) is a private maintenance firm that provides general maintenance services for power plants in South Korea.
- Given the downstream nature of where the firm sits, it is highly reliant on the underlying energy generation sector, which is subjected to government policies/regulations.
SOCAR IPO Post-Listing Flow: VC-Triggered Overhang Vs. Lotte’s Counter Move
- In SOCAR’s IPO, the early investors’ post-listing flow direction draws the market’s attention as much as the valuation issue.
- Even this pricing level is high enough to infer that these VCs will be tempted to consider exiting after listing. A significant level of short-term overhang risk is inevitable.
- Then, we need to factor in the Lotte factor, which will likely expand its stake after listing to secure management rights for Socar.
Pre-IPO Rainmed Medical – The Industry, the Business and the Concerns
- The combination of FFR and IMR can provide a complete functional evaluation from epicardial arteries to myocardial microcirculation,pushing the precise diagnosis and treatment of coronary disease into a new era.
- Rainmed’s caFFR System and caIMR System have obvious technical and first-mover advantages; The CE certificate also opens up the imagination space of product commercialization (such as developing markets).
- However, the concerns on current sales model, market acceptance, medical insurance coverage, cash flow pressure and market sentiment when IPO should also not be neglected.
Before it’s here, it’s on Smartkarma
