IFRASIA INTERNATIONAL FINANCING REVIEW ASIA MARCH 13 2021 ISSUE 1178 www.ifre.com Coupang delivers roaring NYSE debut stoked by lots of unfulfilled orders US Treasury yield spike derails IRFC but Asian credit shows resilience NYSE pariah China Telecom plans A-share homecoming in Shanghai INSIDE: OUTLOOK FOR ASIAN CREDIT ROUNDTABLE LOANS BONDS EQUITIES PEOPLE & MARKETS Leveraged finance Indian infrastructure Powdered milk Orion Credit steps makes a comeback issuers turn to maker shelves up pace of lending in Australia as orphan SPVs to Indonesian IPO on after OMERS pandemic eases sidestep yield cap valuation concerns capital infusion 07 08 08 12 B&RYHULQGG LOOKING FOR A WIDER VIEW OF THE GLOBAL SYNDICATED LOAN MARKET? LOOK TO LPC LPC is the premier global provider of information on the syndicated loan markets. Our first-to- the-market news and comprehensive real-time and historical data help industry players stay informed about market trends and facilitate trading and investment decisions. LPC’s publications, end-of-day valuations, online news, analysis, and interactive databases are used every day by banks, asset managers, law firms, regulators, corporations and others to drive valuation, syndication, trading, research and portfolio management activities. CONNECT TO THE GLOBAL SYNDICATED LOAN MARKET WITH LPC. www.loanpricing.com [email protected] Upfront OPINION INTERNATIONAL FINANCING REVIEW ASIA Impossible India benign of market conditions. %VENûCOMPANIESûWITHû53ûDOLLARûBONDSûTOûRElNANCEûnû ndia has always made it hard for the capital markets. If like Delhi International Airport – have been forced to a once-in-a-lifetime public health crisis and a banking use complicated offshore pass-through structures to get I sector that is running dangerously low on capital cannot themselves out of a tight spot. change that, it's hard to see what will. It is time India's regulators learned to appreciate the India's securities regulator sprung another surprise on BENElTSûOFûTHEûCAPITALûMARKETS ûANDûDESIGNEDûSMARTERû the local bond market on Wednesday with a rule change policies to allow Indian companies to access funding SOûOUTRAGEOUSûTHATûITûPROMPTEDûAûREBUKEûFROMûTHEûlNANCEû without building up undue risks. These blunt policies ministry within 24 hours – a nanosecond in Indian HAVEûOUTLIVEDûTHEIRûUSEFULNESSûANDûTHEûlNANCIALLYûILLITERATEû bureaucracy. regulatory lurches do nothing but damage to the country. Sebi's proposals, due to take effect from April 1, call for mutual funds to value all perpetuals as if they were 100- year bonds. The watchdog makes no distinction between The right formula corporate perpetuals and bank hybrids, and no allowance for put options, coupon step-ups or any other investor- he latest failed IPO in Indonesia is another boost friendly features. to the case for SPACs. After all, if a conventional More to the point, India does not have a 100-year T consumer business can't raise US$500m, what hope BENCHMARKûnûASûTHEûlNANCEûMINISTRYûSWIFTLYûPOINTEDûOUT do the country's tech unicorns have? Making it almost impossible for mutual funds to hold The postponement of Sanghiang Perkasa's local listing is a BIGûBLOWûFORûTHEû)NDONESIANû3TOCKû%XCHANGE A local consumer giant with a strong line in nutritional supplements and milk formula, Sanghiang was unable to India should be making it hit a valuation high enough to justify spinning off from easier for companies to access parent Kalbe Farma, already the 18th biggest stock in Jakarta. the capital markets to support Indonesia's domestic investor base is simply not big ENOUGHûTOûSUPPORTûAûMAJORûmOAT ûANDûINTERNATIONALûINVESTORSû the economy – not harder. demand big discounts for the low liquidity. Kalbe, for instance, trades around US$7m a day. It's no wonder that the likes of Gojek, Tokopedia and perpetual bonds is an inconvenience for the corporate Traveloka have been linked with blank-cheque mergers that sector, where the structure has never really taken off, but would offer them a quick and easy route to the US capital potentially a big problem for India's banks. markets. Around US$5bn of bank hybrids are currently held by At this stage in Indonesia's development, it is hard to mutual funds, which are likely to dump them en masse if make an argument against that. The local market is not the rule remains in place. That will push up funding costs deep enough for a capital-intensive – and inherently risky – across the capital markets, and add to the challenge of tech business, and there is no shortage of SPACs that would recapitalising India's creaking banking system at a time be only too happy to combine with an Indonesian unicorn. when the country desperately needs its lenders to support When it comes to IPOs, South-East Asia's capital markets the economy. repeatedly lose out to their bigger rivals in North Asia or Safeguards for mutual fund investors are sensible, but North America, robbing local investors of the chance to changing the rules at this point is like bolting the doors PARTICIPATEûINûTHEûGROWTHûOFûSOMEûOFûTHEûMOSTûEXCITINGûLOCALû on an empty barn: the writedown of Yes Bank's AT1s last companies. year made the risks of holding loss-absorbing securities The SPAC phenomenon, however, is making it even abundantly clear. harder for South-East Asia to compete. The ongoing Covid-19 crisis also makes the timing Singapore is moving to address that with plans for SPACs impossible to justify. Instead of squeezing bank capital, OFûITSûOWN ûBUTûITSûEXPERIENCEûORûLACKûTHEREOF ûWITHûDUAL India should be making it easier for companies to access class shares shows that a rule change alone is not enough. LOW COST ûlXED RATEûFUNDINGûTOûSUPPORTûTHEûECONOMY In the long run, Indonesia and other ASEAN markets That includes the global capital markets, where India need to reach their own critical mass, to the point that local HASûCOMPLETELYûMISSEDûTHEûCHANCEûTOûBENElTûFROMûAûYEARûOFû champions can list at home or consider a secondary listing, ultra-low monetary policy thanks to a strict cap on credit as has worked well for China. As things stand, however, the spreads that puts offshore debt off limits in all but the most SPAC option has a role to play. International Financing Review Asia March 13 2021 1 B8SIURQWLQGG INTERNATIONAL FINANCING REVIEW ASIA COMPANY INDEX Chongqing Energy Investment Group 22 Kawasaki Kisen Kaisha 37 Shenzhen Royole Technologies 11 ACL Finco 21 Chongqing Sifang New Material 29 Kuaishou Technology 9 Shoko 37 Air Pacific 29 Citicorp Finance India 33 L&T Finance 33 Shui On Development (Holding) 30 ALE Direct Property Trust 19 City Developments 39 Land and Houses Bank 42 SK Bioscience 4 AM/NS Calvert 36 Cliffton 8, 32 Laxmi Organic Industries 34 SoftBank Group 35 Amman Mineral Nusa Tenggara 9 Coconala 37 LG Energy Solutions 5 SOHO (Shanghai) Investment 26 Angel Pond Holdings 27 Colonial First State 7 Liberty Financial 19 Speedcast Holdings III 20 Archi Indonesia 9 Commonwealth Bank of Australia 19 Megvii Technology 6, 28 Speedcast International 20 Asia Commercial Bank 43 Corporacion Andina de Fomento 35 Mercedes-Benz Australia/Pacific 19 SpiderPlus 38 Asian Development Bank 10 Coupang 4 Mercury NZ 38 Sumitomo Electric Finance USA 36 Astra Sedaya Finance 35 CP All 42 Mining Industry Indonesia 34 Sumitomo Mitsui Financial Group 36 Astrea VI Capital 10 Craftsman Automation 34 Mirvac Group Finance 19 Sumitomo Mitsui Trust Bank 35, 36 AU Small Finance Bank 34 Credit Agricole 25 MitraTel 9 Sumitomo Mitsui Trust Holdings 36 Australian Clinical Labs 21 Cyberzone Properties 39 Mitsubishi UFJ Financial Group 36 Sundaram Finance 33 Autohome 27, 28 Daimler 19 Mizuho Financial Group 36 Takamatsu Construction Group 36 Avation 40 Del Monte Philippines 39 Modern Land (China) 24 Temasek Holdings 10 Ayala Land 39 Delhi International Airport 32 Mphasis 33 Times China Holdings 24 BAIC Motor 22 Delhi International Airport Authority 8 National Bank for Agriculture and TMF Holdings 33 Baidu 27 Domain Holdings Australia 22 Rural Development 32 Tokopedia 9 Bangkok Commercial Asset Eclipx Group 19 Nazara Technologies 34 Toronto-Dominion Bank 19 Management 43 Eco World Capital Services 38 Ovo 9 Toyota Leasing Thailand 42 Basecorp Finance 38 Far East Horizon 30 Pepper Group 20 Toyota Motor 36 Basecorp RMBS 2021-1 38 Filinvest Land 39 Pepper I-Prime 2021-1 20 Traveloka 9 Beijing Automotive Group 25 Flexicommercial 19 Pertamina Shipping 9 Trinity Acquisition Corporation 28 Beijing Capital Group 22 Flexicommercial ABS Trust 2021-1 19 PGP Glass Private 32 TRUE 42 Beijing Papaya Mobile Technology 11 Footscray Hospital 21 Piramal Capital Housing Finance 32 Turk Eximbank 39 Beijing Public Housing Center 22 FP Turbo Series 2021-1 19 Polaris Bay Group 28 Victory City International Holdings 30 Beijing SkyOcean Foundation Fuyao Glass Industry Group 28 Property Exchange Australia 7 Visy Packaging Properties 21 Investments 26 GoJek 9 PTT Global Chemical 5, 43 Viz Branz Holdings 40 Belle International Holdings 29 Hongta Securities 28 Quantum Solar Park 38 Vocus Group 7, 21 Belle Sports 29 Hota Industrial Manufacturing 42 REC 33 Waterdrop 29 Bilibili 27 Housing and Development Board 39 RemeGen 28 WestConnex Finance Company 19 Bingo Industries 7 Huali University Group 31 Rizal Commercial Banking Corp 39 WingArc1st 38 Bukalapak 9 Huawei Technologies 25 Sabana Shariah Compliant Industrial Woori Card 41 Chailease International Finance Corp 26 HutchMed (China) 31 Real Estate Investment Trust 40 World Peace Industrial 41 Chailease International Financial India Toll Roads 8 Sakai Ovex 37 WT Microelectronics