Daily BriefsIndustrials

Industrials: Doosan Heavy Industries & Construction, Cs Wind Corp and more

In today’s briefing:

  • Doosan Heavy Offering: Subs Rights Trading at a 3+% Spread, Not Adjusting Oversubscription
  • CS Wind Announces A Rights Offering Worth 350 Billion Won: #1 Player in Korea in Wind Towers

Doosan Heavy Offering: Subs Rights Trading at a 3+% Spread, Not Adjusting Oversubscription

By Sanghyun Park

We are not on Day 3 of the DHI’s ₩1.3T rights offering.

Timetable
BOD meeting September 4, 2020
Preliminary pricing October 12, 2020
Ex-rights date October 14, 2020
Record date October 15, 2020
Subscription rights trade beginning November 18, 2020
Subscription rights trade ending November 24, 2020
Final pricing November 30, 2020
Stockholder subscription December 3, 2020
Public subscription December 8, 2020
Payment December 11, 2020
Listing December 24, 2020
Record date – bonus shares N/A
Listing – bonus shares N/A
Source: DART
Overview
Issuer Doosan Heavy Industries Constrctn Co Ltd
Ticker 034020
Target Pubic-offering of forfeited shares after offering to stockholders
Transferability Renounceable
Volume 121,495,330
Bonus issue volume 0
Preliminary price ₩10,700
Preliminary value ₩1,300,000,031,000
Oversubscription privilege 20.00%
Banker NH & KIS
– Underwriting type Standby
Source: DART

The 1st round pricing was ₩9,640.

The pricing will get finalized on November 30. At the current price, ₩9,640 will be a likely price for a subscription.

1st round pricing
Date October 12, 2020
1st round price ₩9,640
Source: DART
2nd round pricing
Date November 30, 2020
Close ₩14,800
1W VWAP ?
Reference price ₩14,800
2nd round price ₩11,900

Source: DART

Pricing
1st round RP × (1 – 20%) / [1 + (48% × 20%)]
– Reference price (RP) Min [Close, Avg (Close, 1W VWAP, 1M VWAP)]
– Reference date October 12, 2020
Ex-rights base price [RP + (1st × 48%)] / (1 + 48%)
– Reference price (RP) Previous close
– Reference date October 14, 2020
2nd round RP × (1 – 20%)
– Reference price (RP) Min [Close, Avg (Close, 1W VWAP)]
– Reference date November 30, 2020
Final Max [Min (1st, 2nd), 3D VWAP × 60%]
– Reference date November 30, 2020
Discount rate 20.00%
Capital increase rate 48.00%
Source: DART

CS Wind Announces A Rights Offering Worth 350 Billion Won: #1 Player in Korea in Wind Towers

By Douglas Kim

After the market close on 20 November, Cs Wind Corp (112610 KS) announced a rights offering worth 350 billion won ($307 million). Despite the company’s business firing at all cylinders, we believe that this rights offering will have a negative impact on the company’s share price as the new shares could dilute existing shareholders and the rights offering could act as a major overhang on its share price in the next several weeks.

However, the company has picked a good time in trying to complete its rights offering as it has been one of the best performing stocks in the Korean stock market this year (up 232% YTD). It appears that a lot of the positive factors including the Korean New Green Deal and a solid growth of new wind power installations in 2020 have already been reflected in CS Wind’s stock price. 


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