Daily BriefsIPOs and Placements

Equity Capital Markets: PHC Holdings, Oyo, Biocytogen Pharmaceuticals (Beijing), GLOBALFOUNDRIES Inc, Vulcan Steel, Insight Lifetech and more

In today’s briefing:

  • PHC Holdings IPO Trading – Needs to Start Acting like One Company to Move Higher
  • Oyo’s IPO Plan Could Stumble Amidst Ongoing Litigations
  • Biocytogen (百奥赛图) Pre-IPO: From Animal CRO to Biotech
  • GlobalFoundries IPO – The Business
  • PHC Holdings IPO – First Day Trading
  • Vulcan Steel Limited IPO – Past Performance Looks Fine but Margins Might Be at Cyclical Highs
  • Pre-IPO Insight Lifetech – Insights on Industry, Products and Concerns

PHC Holdings IPO Trading – Needs to Start Acting like One Company to Move Higher

By Sumeet Singh

PHC Holdings and its shareholders raised around US$645m, via selling a mix of primary and secondary shares in its Japan IPO. The company is backed by KKR (48.7% stake pre-listing), Mitsui (21.5%), Life Science Institute (13.4%) and Panasonic (11.5%).

We have covered the various aspects of the deal in our earlier notes:

Oyo’s IPO Plan Could Stumble Amidst Ongoing Litigations

By Oshadhi Kumarasiri

  • Hospitality start-up, Oyo (1698548D IN) is trying to ride the Indian IPO wave with a $1.1bn IPO in India. The company filed a draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) on the 1st of October 2021 to commence the IPO process while there is an ongoing legal battle between Oyo and the backpacker hostels chain Zostel.
  • Zostel has requested SEBI to reject Oyo’s draft prospectus stating that Oyo’s capital structure in the draft prospectus fails to recognise Zostel’s right to receive 7% of the share capital of Oyo as a result of a merger agreement between Oyo and Zostel in 2015.

Biocytogen (百奥赛图) Pre-IPO: From Animal CRO to Biotech

By Ke Yan, CFA, FRM

Biocytogen, a China-based pre-clinical research and biopharmaceutical company, plans to raise up to USD 300m via a Hong Kong listing.

We looked at the company’s main business lines, including the gene-editing, pre-clinical pharmacology and efficacy evaluation, as well as the animal model selling. We note that the company has been expanding its business since its establishment in 2009, lately into the biopharmaceutical segment. Having said that, it remains a small player in respective fields of business. In addition to the pre-clinical business, we also look at its two core assets YH003 and YH001 briefly.

Its pre-IPO investors are a mixed bag of domestic and international investors. Its management’s experience is mainly related to the pre-clinical business and less for the biotech business.


GlobalFoundries IPO – The Business

By Mio Kato

GlobalFoundries has filed to IPO as the foundry business enjoys tailwinds from semiconductor shortages. With the company struggling to make profits even in this environment and all adulation seemingly reserved for TSMC we examine whether there is something worthwhile here.


PHC Holdings IPO – First Day Trading

By Mio Kato

After pricing at the low end, PHC Holdings has opened weak, down roughly 10% during most of its early morning trading. There are a variety of issues facing the company so the generally tepid reception is not a massive surprise but valuations are cheap enough that even using conservative assumptions, the downside looks limited.


Vulcan Steel Limited IPO – Past Performance Looks Fine but Margins Might Be at Cyclical Highs

By Sumeet Singh

Vulcan Steel Limited (Vulcan), a pure-play value-added steel distributor and processor, aims to raise around US$273m (A$371m) in its Australia and NZ IPO.

Vulcan operates as a link between steel producers and bulk traders, and end-users. It has a network of 29 operating sites, 16 in Australia and 13 in New Zealand, through which it services over 7,000 customers, as of Jun 21. 

Vulcan distributes steel products, including carbon steel, stainless steel and engineering steel to a diversified customer base including customers in engineering, manufacturing, fabricating, transport, mining and other segments. It also provides value-added processing services for steel coils, steel plates, stainless steel and engineering steel.

The company has put in a steady performance, especially in FY21 with margins hitting recent highs, and expects it to continue in FY22. However, its suppliers, the steel manufacturers, are trading at much cheaper valuation and analysts are building in a decline in their earnings for FY23 as they expect earnings to decline along with steel prices.


Pre-IPO Insight Lifetech – Insights on Industry, Products and Concerns

By Xinyao (Criss) Wang

On August 18, 2021, Insight Lifetech (ILT HK) submitted its prospectus to the Hong Kong Stock Exchange and officially started its IPO process. Lifetech is a medtech company dedicated to developing precision solutions with the potential to transform the diagnosis and treatment of cardiovascular diseases. Founded more than five years ago, Lifetech had already gone through six rounds of financing (at least one round every year). This article mainly analyzed the industry characteristics, the business and the concerns of the Company.


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