This weekly newsletter pulls together summaries of the top ten most-read Insights across Equity Capital Markets on Smartkarma.
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1. HDB Financial IPO: The Investment Case
- HDB Financial Services Ltd (0117739D IN) is India’s seventh-largest non-banking financial company (NBFC). It is seeking to raise Rs125 billion (US$1.4 billion).
- The proposed IPO comprises a primary raise of Rs25 billion (US$388 million) and a secondary raise of Rs100 billion (US$1.2 billion) by the parent.
- The fundamentals are average at best, as HDB does not outperform its NBFC peers on key performance indicators.
2. Anjoy Foods Group A/H Listing – Isn’t Great but Can’t Ask for It to Cheaper
- Anjoy Foods Group (603345 CH), a quick-frozen food company in China, aims to raise around US$336m in its H-share listing.
- AFG was the largest quick-frozen food company in China in terms of revenue in 2023, with a market share of 6.2%, according to the Frost & Sullivan report.
- We have looked at the past performance and likely A/H premium in our previous note. In this note, we talk about the IPO pricing.
3. Innovent Biologics Placement – Second for the Month, Stock Has Doubled but Momentum Is Strong
- Innovent Biologics Inc (1801 HK) aims to raise around US$500m for R&D and marketing.
- The company has undertaken a number of deals in the past, with the overall results being mixed but recent deals have done well.
- In this note, we will talk about the deal dynamics and run the deal through our ECM framework.
4. IFBH Ltd IPO: Heavy on Coconut and Light on Asset Makes the IPO Juicy
- IFBH Ltd launched its Hongkong IPO aiming to raise up to HK$1,160 million. The company plans to sell 41.7 million shares at HK$25.3–27.8 per share.
- IFBH is a ready-to-consume beverage and food company based in Thailand. It enjoys market leader position in the ready to drink coconut water segment in Mainland China.
- The growth momentum is expected to continue in the near term. IFBH’s leadership position would help garner volume strength. We would recommend the investors to subscribe to the issue.
5. HDB Financial IPO: Valuation Insights
- HDB Financial Services Ltd (0117739D IN) is India’s seventh-largest non-banking financial company (NBFC). It is seeking to raise Rs125 billion (US$1.4 billion).
- I discussed the fundamentals in HDB Financial IPO: The Investment Case. The shares will be listed on 2 July.
- My valuation analysis suggests the HDB is fully priced at the IPO price range of Rs 700- 740 per share. I would avoid the IPO.
6. IFBH IPO – Leading Position in a High Growth F&B Segment Driving Valuations
- IFBH (IFBH HK) is looking to raise about US$148m in its HK IPO.
- IFBH specializes in ready-to-consume beverages and food, with a focus on coconut water and plant-based products.
- In our previous note, we looked at the firm’s past performance. In this note, we talk about the IPO valuations.
7. EB Event Trade Setup: HD KSOE Lining up a New Deal with HD Hyundai Heavy as the Underlying
- HD KSOE plans a second EB similar to earlier this year: a zero-coupon, 2% HD Hyundai Heavy stake with 13–15% premium, aiming to raise around ₩850 billion.
- With Korea’s Commercial Act revision expected by July 4, EB deals risk director liability; HD KSOE aims to raise cash now before stricter rules limit easy board-approved EB issuance.
- Targeting a short in HD Hyundai Heavy triggered by HD KSOE’s board approval before July 4; consider hedging with a long position in HD KSOE due to ongoing sector catalysts.
8. FWD Pre-IPO – PHIP Updates – Growth Slowing, Metrics Evolution Continues
- FWD Group Holdings (FWD HK), a pan-Asian life insurer founded by Richard Li, now aims to raise around US$500m in its HK IPO.
- FWD is a pan-Asia life insurer operating in ten markets including Hong Kong (and Macau), Thailand (and Cambodia), Japan, the Philippines, Indonesia, Singapore, Vietnam and Malaysia.
- We looked at the company’s 2018-21 performance in our past notes. In this note, we will talk about the updates since then.
9. Zhejiang Sanhua Intelligent Controls A/H Trading – Strong Demand, Weakening Sentiment
- Zhejiang Sanhua Intellignt Controls (002050 CH) (ZSIC), a manufacturer of refrigeration and air-conditioning control components, raised around US$1.4bn in its H-share listing.
- ZSIC is a market leader in a number of products, with commanding market share both domestically and globally.
- We have looked at the past performance and likely A/H premium in our previous note. In this note, we talk about the trading dynamics.
10. Xero US1.2bn Placement – Trying to Jump Start US, Again. Might Not Be a Game Changer.
- Xero Ltd (XRO AU) plans to raise around US$1.2bn via an institutional placement to partly fund the US$2.5bn acquisition for Melio.
- The US market has been a growth dampener for Xero for a while. The acquisition is large but might not be a game changer.
- In this note, we will talk about the deal dynamics and run the deal through our ECM framework.
