Objective

  • In this course, you will learn from leading analyst Mr. Ke Yan, CFA, who is an independent research analyst focusing on IPO research. He has more than seven years of experience in investment research and recently co-founded Aequitas Research. The firm’s clients include international hedge funds, sovereign wealth funds, as well as global long-only funds. Ke Yan is frequently quoted by international media such as Bloomberg, Thomson Reuters, S&P Global Market Intelligence, The Wallstreet Journal, and Business Times.

Who should attend this course

  • Students wanting to do research for Mezzanine funds, investment banks’ ECM (equity capital market) teams, sell-side, and hedge funds
  • Individuals who are wish to find out how professional analysts look at IPO deals

Pre-requisite skills

  • Know basic financial modelling
  • Accountancy Graduates, Finance Graduates or CFA Level 1 candidates

Outcome

  • Confidently present an investment thesis and interview for a junior role in ECM/ DCM teams

Curriculum

Lesson 1: IPO fundamentals

  • Understanding the IPO Process: Timeline of an IPO Process
  • Know the key players and their roles in the IPO process:  Pre-IPO investors, manager, lead underwriter, co-underwriter, IPO manager, lawyers, cornerstone investors, anchor investors
  • Terminologies you should know: Book building, Allotment Vs Allocation, Draft Offer Document, Red Herring Prospectus, Underwriters, Greenshoe, Clawback, Lock up period
  • Apply your understanding using a case study

Homework

With an IPO prospectus given to you, here is a quiz to identify the key players and terms.

Lesson 2: Quantitative Focus

  • Answer sharing for Homework 1
  • Overview of a typical prospectus
  • Identify the key information to extract for the company/sector (eg. Company’s products, services, and underlying industry).
  • Collect data and adjust key figures
  • Build suitable ratios

Homework

Apply what you learnt with clues given during the class

Lesson 3: Qualitative Focus

  • Shareholders/Investors
  • Management team background
  • Related Party Transactions: How bad is bad?
  • Reputation Risks

Homework

Apply what you learnt with clues given during the class

Lesson 4: Adding value as an analyst

  • Investigative research using websites and contacts
  • Use Wind/Bloomberg/CEIC or other databases
  • Comparing operating numbers with peers

Homework

Apply what you learnt with clues given during the class

Lesson 5: Valuation

  • Identify suitable valuation metrics for the company. Case studies: Pharma, Education, Tech, Finance/Fintech, Transport
  • Understand market valuation of peers
  • What it means at top/mid/ bottom range of the IPO price range
  • To subscribe or not to subscribe

Homework

Prepare Your Thesis

Lesson 6: Review

Presentation Time  & Feedback

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