ASIA-PACIFIC
CHINA
SUNNY OPTICAL SHINES ON DEBUT!ûDEBUTû53MûOFFERINGûOFûlVE
YEARû
bonds from SUNNY OPTICAL TECHNOLOGY (GROUP)
was multiple times subscribed, pointing to
the massive bid from global investors for
Chinese tech issues.
The smartphone camera modules and lens
maker, whose stock is up 170% in the past 12
months and hit a record last November, drew
orders of US$9.1bn from 329 investors,
giving the leads enough momentum to price
the bonds last Wednesday at Treasuries plus
150bp, 35bp inside initial guidance.
4HEûCOMPANYûUNVEILEDûAû$ûSMARTPHONEû
camera in November that uses facial
recognition technology and adds animoji
FEATURESûTOûPHOTOSû!CCELERATEDû$ûADOPTIONû
in Android smartphones is seen driving
earnings this year.
The bonds were chased in secondary trade
and were spotted at a tighter Treasuries plus
134bp–137bp bid. A fund manager saw
brokers like Haitong Securities offering bids
WHENûlNALûGUIDANCEûWASûANNOUNCEDûATû
Treasuries plus 142bp–146bp, highlighting
the hot demand.
Sunny’s sharp gains in the secondary
suggest that rare debut names in coveted
industries have room to narrow pricing
aggressively. The bonds trade inside those
with similar tenors and ratings from
established China issuers.
#HINAû3TATEû#ONSTRUCTIONSûlVE
YEARû
bonds, rated Baa2/BBB+ (Moody’s/Fitch),
were spotted at Treasuries plus 132bp–
128bp, according to Tradeweb. Sunny’s new
notes have initial ratings of Baa2 (stable)
from Moody’s.
The robust performance comes a week
after Tencent Holdings drew orders in
excess of US$40bn at one stage for a US$5bn
four-tranche issue, which repriced its curve.
h)TûALSOûOFFERSûGOODûDIVERSIlCATIONûFROMû
local government funding vehicles, real-
estate companies and state-owned
enterprises,” said one banker on the issue.
For Sunny’s maiden issue, bankers used
Tianqi Lithium’s Baa3 rated US$300m
.OVEMBERûSûASûAûBASEûTOûlNDûFAIRûVALUE û
estimated at around Treasuries plus 155bp–
160bp. Tianqi, which makes lithium batteries
and has a similar operation scale and high
customer concentration risk like Sunny, had
its latest bonds trading around Z plus 170bp.
Not only did Sunny come inside those
estimates, but it also came close to Huawei’s
3.125% 2022s, which Nomura considers a
stronger credit. Huawei’s notes were trading
around Treasuries plus 109bp–103bp,
according to Tradeweb.
/FûTHEûlNALûBOOK û!SIAûACCOUNTEDûFORûû
and the EMEA for the rest. In terms of
investor types, fund managers were
allocated the largest portion of 72%, while
insurers and sovereign wealth funds
received 13%, banks got 12%, and private
banks and others got 3%.
Proceeds will be used for capital
expenditure, working capital, debt
RElNANCINGûANDûOTHERûGENERALûCORPORATEû
purposes. Moody’s expects the company’s
debt leverage to rise to about 1.3x in 2018
from about 0.7x in 2017, as it pre-funds this
year’s capacity expansion. Sunny has
maintained a net cash position since 2007,
but the rating is constrained on the low
visibility of product demand.
Citigroup and UBS were joint global
coordinators on the issue, as well as joint
bookrunners and joint lead managers with
BNP Paribas.JINJIANG PRINTS DEBUT EURO BONDSJINJIANG INTERNATIONAL HOLDING priced a debut
€500m 0.817% three-year senior unsecured
credit-enhanced bond at mid-swaps plus
77bp, well below 95bp area initial guidance.
The Chinese tourism and leisure group
ATTRACTEDûlNALûORDERSûINûEXCESSûOFûõBNû
from over 80 accounts.
h$EMANDûFORûTHEûDEALûWASûVERYûSTRONGû
with many big European institutional
investors participating,” a syndicate banker
from a Chinese bank on the deal said.
Another banker familiar with the
TRANSACTIONûSAIDûTHEûlNALûSPREADûWASûhTOTALLYû
bonkers to the layman but to the poor euro
investor a gift from up on high.”
The bonds were spotted 7bp tighter in the
secondary.
EMEA took 60% of the bonds and Asia 40%.
In terms of investor types, 47% were fundmanagers, 41% were bank treasuries, a
combined 10% were insurers, pension funds
ANDûOFlCIALûINSTITUTIONS ûANDûûWEREûPRIVATEû
banks and others.
Wholly owned subsidiary Triceratops
Capital is the issuer of the Reg S notes,
which has a keepwell deed from Jinjiang
International. Payments of the principal and
the interest will be backed with a euro-
denominated standby letter of credit from
ICBC, Shanghai branch.
The notes have an expected A1 rating
from Moody’s.
Proceeds will be used for repayment or
RElNANCINGûOFûOFFSHOREûDEBTûANDûTOû
supplement working capital.
ICBC, BNP Paribas and Credit Agricole were
joint global coordinators and joint
bookrunners with HSBC, Standard Chartered
and Agricultural Bank of China Hong Kong branch.JUYANG HIRES FOR DOLLAR ISSUESI CHUAN PROVINCE JUYANG GROUP, rated B2/B
(Moody’s/Fitch), has mandated three banks
to arrange investor meetings and a call in
Hong Kong from January 17 ahead of a
proposed offering of US dollar notes.
CCB International and Guotai Junan International
have been hired as joint global coordinators.
They are joint lead managers and joint
bookrunners with Oceanwide Securities.
A proposed Reg S-only offering of senior
unsecured US dollar notes may follow. The
notes will be issued in the name of Zhong Yi
Holdings with a guarantee from Si Chuan
0ROVINCEû*U9ANGû'ROUP
The notes are expected to score ratings of
B3 from Moody’s and B from Fitch.
3Iû#HUANû0ROVINCEû*U9ANGû'ROUPûISûAû
Chinese developer and owner of hotels and
real-estate properties in southern Sichuan
province.GCL NEW ENERGY GOES FOR DOLLARSGCL NEW ENERGY HOLDINGS, rated Ba2/BB–
(Moody’s/S&P), has hired banks for a
proposed issue of US dollar Reg S senior
unsecured bonds.
Bank of America Merrill Lynch, Haitong
International, Credit Suisse, Standard Chartered
and CLSA are joint global coordinators on
the issue, as well as joint lead managers and
joint bookrunners with Orient Securities (Hong
Kong), VTB Capital and SPDB International.
The Chinese solar-power company began
meeting investors in Hong Kong, Singapore
and London from last Thursday.
The notes are expected to be rated Ba3/B+
(Moody’s/S&P).
Proceeds will be used for business
DEVELOPMENT ûTOûREPAYûlNANCIALûBORROWINGS û
including a Credit Suisse term loan, and for
other general corporate purposes.ALL INTL EMERGING MARKETS BONDS
BOOKRUNNERS: 1/1/2018 TO DATE
Asia-Pacific
Managing No of Total Share
bank or group issues US$(m) (%)
1 HSBC 15 1,525.87 6.8
2 Deutsche Bank 9 1,322.99 5.9
3 Citigroup 10 1,317.37 5.9
4 Bank of China 11 1,277.90 5.7
5 BNP Paribas 7 1,164.69 5.2
6 UBS 9 1,078.87 4.8
7 Morgan Stanley 5 1,038.59 4.6
8 Credit Suisse 6 971.99 4.3
9 Goldman Sachs 6 904.58 4.0
10 Standard Chartered 10 897.79 4.0
Total 38 22,417.54
Excluding equity-related debt.
Source: Thomson Reuters SDC code: L4