Report
Sumeet Singh
EUR 88.49 For Business Accounts Only

Chervon Holdings IPO

Chervon Holdings Limited (CHL) raised around US$435m in its Hong Kong IPO.

CHL is the largest China-based global provider of power tools and outdoor power equipment (OPE). As per Frost & Sullivan (F&S), CHL was ranked 7th globally by revenue for electric power tools and 2nd globally for electric OPE in 2020.

However, the company has failed to shed light on a number of important points including the change in its arrangements with Home Depot and Lowe’s in FY20, both of which were its top two customers. In addition, not all of its brands or regions appear to have grown strongly while its 3Q21 results point to a slowdown ahead.

We have covered various aspects of the deal in our previous coverage of the IPO:

Chervon Holdings Pre-IPO - Fast growth, good reviews but patchy disclosures
Chervon Holdings IPO - Valuation isn’t demanding, but timing is

In this note, we will talk about trading dynamics.


However, the company has failed to shed light on a number of important points including the change in its arrangements with Home Depot and Lowe’s in FY20, both of which were its top two customers. In addition, not all of its brands or regions appear to have grown strongly while its 3Q21 results point to a slowdown ahead.

In this note, we will talk about valuations.

Our previous coverage of the IPO:

Chervon Holdings Pre-IPO - Fast growth, good reviews but patchy disclosures


However, the company has failed to shed light on a number of important points including the change in its arrangements with Home Depot and Lowe’s in FY20, both of which were its top two customers. In addition, not all of its brands or regions appear to have grown strongly while its 3Q21 results point to a slowdown ahead.

In this note, we will talk about the company’s background and its past performance.
Underlying
Chervon Holdings Limited

Provider
Aequitas Research
Aequitas Research

Aequitas Research is a leading ECM research firm with a focus on IPOs and placements/follow-on offerings across the Asia Pacific with deal size of over USD100m. 

Since 2015, we have covered 400+ IPOs and 450+ placements with a hit rate of 73% and 65%, respectively. We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic analysis.
 
Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis. We also provide a more quant driven analysis on placement/follow-on offerings.
 
Markets that we cover include:
Hong Kong,
China ADRs,
India,
Japan,
Australia, and
ASEAN.

Analysts
Sumeet Singh

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