IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

Arun has over 15 years’ experience covering the Technology sector. During this time, he has worked with technology start-ups and as an equity analyst in investment banks and independent research firms. He was formerly a Technology Analyst for Canaccord Genuity, Altium Securities, Espirito Santo Investment Bank, Noble Group and Clear Capital. He has a dual Master’s degree in Financial Engineering and Industrial and Operations Engineering from the University of Michigan. He obtained his Bachelor’s degree in Mechanical Engineering from the Indian Institute of Technology, Bombay. He is also a CFA charterholder.

IPOs and Catalysts/Events

Simcere Pharmaceutical IPO Initiation: A Rough Patch?

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Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Equity Capital Markets

Simcere Pharmaceutical Group / Equity Capital Markets

<div><p><a href="https://www.smartkarma.com/entities/simcere-pharmaceutical-group" target="_blank" data-smartkarma-citation="entities:29186:1" rel="noopener">Simcere Pharmaceutical Group (2096 HK)</a> is engaged in the R&amp;D, production and commercialisation of pharmaceuticals and is primarily focused on generic pharmaceuticals.  At the proposed IPO price range of HK$12.10-13.70 per share, Simcere will have a market cap of HK$31,528.8-35,697.9 million ($4.1-4.6 billion). At the mid-point of the IPO price range, Simcere will raise net proceeds of HK$3,191.3 million ($412 million). </p></div><div id="ember2866">Seven cornerstone investors will subscribe for 43.81% of the offer shares at the mid-point of the IPO price range. The cornerstone investors are Hillhouse Capital, Jiangbei Investment Group, Shenzhen Capital Group, Lake Bleu Capital, OrbiMed, Sage Partners and Jericho Capital. </div><div id="ember2871"></div><div><div><div class="content-highlight"><p>In <a href="https://www.smartkarma.com/insights/simcere-pharmaceutical-ipo-initiation-a-rough-patch" target="_blank" rel="noopener">our initiation note</a>, we highlighted that for investors willing to look past the 2020 results, Simcere is putting in place the right measures to ensure that the weak 1H20 was an exception rather than the rule. Overall, we think that an attractive PEG valuation and solid cornerstone support makes Simcere tempting at the proposed pricing range. </p></div></div></div>

Simcere Pharmaceutical Group (2096 HK) is engaged in the R&amp;D, production and commercialisation of pharmaceuticals and is primarily focused on generic pharmaceuticals.  At the proposed IPO price range of HK$12.10-13.70 per share, Simcere will have a market cap of HK$31,528.8-35,697.9 million ($4.1-4.6 billion). At the mid-point of the IPO price range, Simcere will raise net proceeds of HK$3,191.3 million ($412 million). Seven cornerstone investors will subscribe for 43.81% of the offer shares at the mid-point of the IPO price range. The cornerstone investors are Hillhouse Capital, Jiangbei Investment Group, Shenzhen Capital Group, Lake Bleu Capital, OrbiMed, Sage Partners and Jericho Capital. In our initiation note, we highlighted that for investors willing to look past the 2020 results, Simcere is putting in place the right measures to ensure that the weak 1H20 was an exception rather than the rule. Overall, we think that an attractive PEG valuation and solid cornerstone support makes Simcere tempting at the proposed pricing range. 

Shanghai Fosun Pharmaceutical (Group) (2196 HK)

Simcere Pharmaceutical IPO: Valuation Insights