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Converge ICT is the largest high-speed fixed broadband operator in the Philippines, by high-speed residential fixed broadband subscriptions. It also claims to be the fastest growing fixed broadband operator in both the residential and enterprise market.
CICT’s revenue has grown at 69% CAGR over FY16-19, with growth being led by its residential business whose revenue has increased at 95% CAGR. Gross profit grew at 56% CAGR, EBITDA at 91% CAGR and Net profit at 60% CAGR. In other words, most of the revenue growth has flowed down to the bottom line.
I have covered the company background, undertaken a peer comparison and spoken about valuation in my earlier reports, links to which are below. In this note, I’ll talk about deal dynamics and recent updates from the prospectus.
Links to my previous notes:
Converge ICT Pre-IPO - Fast growth, low penetration, COVID resistant
Converge ICT Pre-IPO - Peer comparison - Not a clear cut winner
Converge ICT Pre-IPO - Thoughts on valuation
Converge ICT IPO
Converge ICT (CICT) aims to raise around US$600m in its Philippines listing.Converge ICT is the largest high-speed fixed broadband operator in the Philippines, by high-speed residential fixed broadband subscriptions. It also claims to be the fastest growing fixed broadband operator in both the residential and enterprise market.
CICT’s revenue has grown at 69% CAGR over FY16-19, with growth being led by its residential business whose revenue has increased at 95% CAGR. Gross profit grew at 56% CAGR, EBITDA at 91% CAGR and Net profit at 60% CAGR. In other words, most of the revenue growth has flowed down to the bottom line.
I have covered the company background, undertaken a peer comparison and spoken about valuation in my earlier reports, links to which are below. In this note, I’ll talk about deal dynamics and recent updates from the prospectus.
Links to my previous notes:
Converge ICT Pre-IPO - Fast growth, low penetration, COVID resistant
Converge ICT Pre-IPO - Peer comparison - Not a clear cut winner
Converge ICT Pre-IPO - Thoughts on valuation
Underlying
Converge ICT
Provider
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.
Hong Kong,
China ADRs,
India,
Japan,
Australia, and
ASEAN.
Sumeet Singh
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