• The processing status of the Adani Wilmar draft prospectus is back to “under process” as at 24 Sep.
• This is a positive as it suggests the listing of Adani Wilmar is back on track.
• We see the potential listing of Adani Wilmar and better 2H results as potential catalysts for the stock. Reiterate ADD on Wilmar (SGX:F34) with unchanged target price of S$6.15.

Wilmar’s IPO Plan for Adani Wilmar Back to “under Process”

• Wilmar International announced that the Securities and Exchange Board of India (SEBI) has updated its website on the Processing Status of Draft Offer Documents (as at 24 Sep 2021 to reflect that the status of the draft red herring prospectus submitted by Adani Wilmar Limited (AWL), a 50.50 joint venture company between the Adani group and the Wilmar group, in relation to AWL’s proposed Initial Public Offering (IPO) on BSE Limited and National Stock Exchange of India Limited, is now “under process”
• To recap, Wilmar had on 20 Aug announced that SEBI’s website listed the current processing status of the draft herring prospectus in relation to the proposed Adani Wilmar IPO as “issuance of observation kept in abeyance”.

Positive News for Wilmar

• We view this as a positive development as it suggests that the listing of gain of US$1.6bn to US$2.5bn (or S$0.33 to S$0.52 per Wilmar share).

Reiterate ADD on Wilmar

• Reiterate ADD, with an SOP-based liquid entry into its 90%-owned Yihai Kerry Arawana (YKA), listed on the Shenzhen bourse.

• Downside risks are inability to pass on higher commodity prices to consumers and the listing of AWL falling through.

Source: CGS-CIMB Research - 28 Sep 2021