Last Week In Global IPOs: IPOX U.S. Drives IPOX Global To YTD High - PICC, MegaFon Set For Global IPO Surge

by: Josef Schuster

IPOX Weekly Summary:

· Key IPOX Strategies record big rise: IPOX Global closes at highest level Year-To-Date.

· IPOX U.S. leads, finishes just shy of All-Time High.

Amid improved sentiment, H.K./London IPOs in focus.

IPOX Returns, Notable Company Moves:

· IPOX U.S. leads IPOX Global to Fresh 2012 Highs: Global stocks bounced strongly after U.S. option expiration as key Asian markets continued to rally, the dollar receded vs. the Euro with Washington shut for Thanksgiving week. Key IPOX Strategies were the main beneficiaries: The IPOX Global 50 (IPGL50) closed out the week at a new 2012 high, rising +3.13% to +18.98% YTD. Big gains in the IPOX heavyweights including miner Glencore International (OTCPK:GLCNF) after winning EU Approval for its USD 33bn Xstrata takeover, U.S. car manufacturer and S&P 500 inclusion candidate General Motors (NYSE:GM) or a new post-IPO high in Hong Kong traded Macau casino behemoth Sands Chinas (1928 HK: +6.46%) fueled the positive momentum. In the cross-section, the IPOX Strategies all recorded solid gains: For example, the IPOX U.S. universe (NYSEARCA:FPX) rose +5.78% to +23.60% YTD, closing near its all-time high. A big bounce in Chicago-based USDbn 2.6 Groupon (NASDAQ:GRPN) helped, after NY hedge fund Tiger Global disclosed the big stake which Russian's (MAIL LI: -3.60%) had sold.

In IPOX Europe (IXTE, IPXUJPEU), we note the reversal in Spain's Amadeus IT (OTCPK:AMADF) after HSBC Holdings Plc (HBC) disclosed a 5.4% stake in the company which it had failed to place earlier. Tokyo-traded snack maker Calbee (2229 JT: -4.84%), set to enter the MSCI Japan Index (MXJP) on November 30th, fell on rumors over a big foreign acquisition as Fidelity Investments cut its holding by 1%.

· IPOX Strategy Returns YTD 2012:

Ticker (BBG/Reuters) Week Q3 12 YTD 12
IPOX Global 50 (IPGL50) (USD) +3.14% +7.31% +18.99%
MSCI World (MXWD) +3.93% +6.24% +10.12%
IPOX U.S. 100 (IPXO) +5.78% +7.09% +23.60%
IPOX U.S. 30 (IPXT) +5.74% +5.39% +22.91%
S&P 500 (SPX) +4.13% +5.76% +12.05%
IPOX Europe50 (IPXUJPEU) (EUR) +2.32% +11.75% +4.95%
IPOX Europe30 (IXTE) (EUR) +2.11% +11.76% -0.11%
STOXX 50 (SX5P) (EUR) +3.59% +5.76% +6.97%
IPOX Asia-Pacific 30 (IPTA) +2.83% +6.82% +26.02%
MSCI Asia-Pacific (MXPC) +2.39% +2.56% +5.55%
IPOX China 20 (CNI) +2.70% -1.96% +7.58%
IPOX China Cp. (IPXUCHCP) +3.09% +3.18% +11.41%
Hang Seng Enprs. (HSCEI) +3.56% +2.68% +6.75%
Why choose IPOX to close the IPO/spin-off asset allocation gap?
§ Proven: Real-time performance over market cycles

§ Scalable and Stable: Clearly defined Philosophy

§ Patented: Portfolio Construction Technology

§ Best in Practice: Investment Management Mandates

· Significant IPOs Traded (Week: 11/19/2012):

Company Ticker Return/IPO
Alon USA Partners LP ALDW US 14.38%
CIFI Holdings Group Co Ltd 884 HK -1.50%
Hudson's Bay Co HBC CN -1.18%
YY Inc YY US 7.81%

9 global IPOs started trading last week, with the average (median) IPO gaining a strong +18.12% (+9.33%). The most significant deal belonged to the IPO of Canada's department store operator, 2.4% yielder Hudson's Bay (HBC CN). After pricing its IPO at the low end, Chinese Social networker YY Inc. (YY US) became the 2nd China tech IPO YTD listing in the U.S. The weak debut of real estate developer CIFI Holdings (884 HK) underlines the selective nature of the H.K. IPO market.

· Upcoming global IPOs (Week: 11/26/2012):

Company Code Date Lead
Tsui Wah Holdings 1314 HK 11/26 DB
MegaFon OAO N/A LN 11/28 CITI, CS, MS
Future Land Dvlpmt. 1030 HK 11/29 ML
PICC Inc. 1339 HK 11/30 All Major

Focus is on IPOs in H.K. and London: Pricing of the USDbn 4bn IPO of mainland insurer PICC Group (1339 HK) is set for Nov. 30 with a Dec. 7th listing implying a week's worth of market risk. The company has opted for a Hong Kong H-share IPO first and is set to be substantially oversubscribed at the low/mid-end of the HKD 3.42- 4.02 range. Incumbent Financial AIA Group (1299 HK) rose +17.13% upon its listing debut in 10/2010. Russia's 2nd largest mobile phone firm, MegaFon (OAO), seeks to raise USD 2bn, valuing the firm between USDbn 11.2-14.0, in line with incumbents. Given its low growth nature and the disappointing performance of recent IPO Telefonica Deutschland (O2D GR), we expect the deal to price at the low end at most. Restaurant Group Tsui Wah Holdings (1314 HK) and real estate developer Future Land Development (1030 HK) are set to extend the list of this years of small-cap H.K. IPOs.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.