This weekly newsletter pulls together summaries of the top ten most-read Insights across Equity Capital Markets on Smartkarma.
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1. NIO HK Placement – Lots of Reasons to Avoid and Only One to Invest
- NIO (9866 HK) is looking to raise around US$450m via a primary placement in Hong Kong.
- The shares haven’t done much this year or ever since they were listed.
- In this note, we will talk about the placement and run the deal through our ECM framework.
2. The Hidden Play in Hanwha’s Noisy Stake Reshuffling: Hanwha Corp’s Rights Issue
- Hanwha Corp’s chances of raising 1T KRW without a capital call are slim, likely channeling Hanwha Energy’s 1.3T KRW into Hanwha Corp intead of Hanwha Aero.
- A shareholder-allotted rights issue from Hanwha Corp looks likely, and with short-selling resumption, it sets up a clean arbitrage play with low risk before the official announcement.
- Timing is key—Hanwha’s using debt for now, but likely won’t delay long. Expect Hanwha Corp’s rights issue to follow Hanwha Aero’s, probably between June and July.
3. Revisiting Korea’s Local Rights Issue Arb Setup
- Korea’s rights issues offer a clean arb setup—track stock rights vs. spot price, with first price as a cap, and lock in predictable entry vs. exit costs.
- Aggressive locals skip hedging, betting the discount holds between final pricing and listing. History backs it, but it’s a case-by-case call—not a blanket recommendation.
- Samsung SDI and Hanwha Aerospace’s KRW 5.5T raise is massive, likely flooding stock rights into the market—prime setup for arb plays.
4. Xiaomi US$5.3bn Placement – Relatively Small, Strong Momentum but Is Expensive
- Xiaomi Corp (1810 HK) is looking to raise around US$5.3bn via selling 3% additional shares.
- The shares have done exceedingly well this year and are now trading at their all time highs.
- In this note, we will talk about the placement and run the deal through our ECM framework.
5. Ecopro Materials: Announces A Capital Raise Worth 389 Billion Won
- EcoPro Materials announced a capital raise worth 389 billion won. The company plans to issue 5.12 million new shares, representing 7.3% of its current outstanding shares (69.74 million).
- This capital raise is in the form of redeemable convertible preferred shares (RCPS). Conversion price of this RCPS is 75,974 won which is 9.9% higher than current price.
- Ecopro Materials’ share price is down 27% from 27 February 2025. We continue to remain negative on Ecopro Materials.
6. LG Electronics India IPO: It’s A Big Deal. Potential Pricing and Valuation Preview
- LG Electronics India has secured regulatory approval for its IPO, expected to raise between USD 1 to 1.5 billion.
- However, it remains unclear whether the company will delay the launch until market sentiment shows further improvement.
- LG Electronics India (123D IN) IPO is a 100% offer for sale by parent and hence the entire proceeds from the IPO will accrue to LG Electronics (066570 KS).
7. A/H Premiums and past A/H Listings Performance Data – Mixed Results but Size Matters
- Given the slew of A/H offerings in the Hong Kong IPO pipeline, in this note, we talk about the overall A/H premiums currently.
- We also had a quick look at the past A/H listing performance, including subscription rates and A/H premiums at the time of listing.
- Overall, most of the A/H listings haven’t done much in the near term, with a few exceptions.
8. Gigabyte GDR Early Look – Benefitting from the AI Server Wave, Further Scale-Up Underway
- Gigabyte Technology (2376 TT) is looking to raise up to US$395m in its upcoming global depository receipts (GDRs) offering.
- On 14th Mar 2025, Gigabyte announced that it received its board’s approval to sell upto 50m common shares via a GDR offering. The proceeds will be used for business development.
- Similar to previous GDR listings, the deal is a long drawn out process with the firm required to jump through a number of board/shareholder/regulatory approval loops.
9. Lotte Global Logistics IPO Preview
- Lotte Global Logistics is getting ready to complete its IPO in KOSPI in May 2025. IPO price range is from 11,500 won and 13,500 won.
- At the high end of the IPO price range, the expected public offering amount is 202 billion won.
- According to the bankers’ valuation, the expected market cap after the IPO is 479 billion won to 562 billion won.
10. DN Solutions IPO: Valuation Insights
- DN Solutions (298440 KS), the third-largest machining centre/turning centre machine tool manufacturer, seeks to raise US$1.1 billion in a KRX IPO.
- We previously discussed the IPO in DN Solutions IPO: The Bull Case and DN Solutions IPO: The Bear Case.
- I examine the syndicate’s valuation methodology. My analysis suggests that DN Solutions is palatable in the low end of the IPO price range.
