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PXA - PEXA Group

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So_Cynical

So_Cynical

The Contrarian Averager
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After years of speculation and anticipation PEXA will list in early July, trading is expected to start at around $17 with a market cap of about 3 billion, the IPO seems to be a done deal with few shares available to the retail market, After the listing LNK will hold 47% and CBA 29% so not much of a free float.

PEXA has a digital platform that handles about 80% of all Australian property settlements, the platform is scalable thus has international growth potential much like Afterpay and Xero and a few of the other tech favourites. Given the current exuberance the listing is expected to go of with a bang!

Online Property Settlement & Actionable Insights | PEXA

PEXA offers secure online property settlement, digital solutions & actionable insights to unlock the life-changing potential in property.
www.pexa.com.au www.pexa.com.au
 
Last edited:
Torrens Group Holdings Limited (to be renamed PEXA Group) - 07 July 2021 #

Listing date07 July 2021 #
Company contact details

Online Property Settlement & Actionable Insights | PEXA

PEXA offers secure online property settlement, digital solutions & actionable insights to unlock the life-changing potential in property.
www.pexa.com.au www.pexa.com.au
Principal ActivitiesOperator of digital property settlement platform in Australia
GICS industry groupTBA
Issue Price$17.13
Issue TypeOrdinary Fully Paid Shares
Security codePXA
Capital to be Raised$1,175,000,000
Expected offer close date28/06/2021
UnderwriterFully underwritten. Barrenjoey Advisory Pty Limited, Macquarie Capital (Australia) Limited, Morgan Stanley Australia Securities Limited and UBS AG, Australia Branch (Joint underwriters and Lead Managers)
 
This will be an interesting one. Lists on the ASX 1 July 2021. I think it is mandatory that all conveyancing transactions be done on this platform now, or almost mandatory. My friends got an invitation for the IPO, so I'm left to buy out in the wild.
 
Been a bit of a disappointment thus far, went under IPO price for a bit and now it's only slightly above IPO price.

I still think it's a good long term hold, but maybe the SP of $17 on listing was a bit optimistic.
 
i hold LNK

like most new floats i look at ( except YFZ ) i like to wait a year or two and see how management performs
 
1 Month since the float and PXA is at $16.38, I'm a little surprised at the share price weakness, was fully priced at listing
and was a very big listing, always was one for the long term anyway.
 
Noticed last two high volume bullish bars. Bought a parcel for short term trade but this has potential to be a longer term hold if price can stay above 16.40.

pxa0408.PNG
 
It's been a few more days and we can see that each time price has gone down there's been some buying to get it back to 17.00. I think it won't be long before price rallies and we won't see 17.00 again for a long time. I've got to be a bit cautious as the daily volume is very low. A sizable seller could force price down quite easily.

pxa1008.PNG
 
PEXA has been trading for two months as a listed company; today the company stated it was on track to meet its prospectus forecast for a near-12 per cent increase in revenue this year and narrow its net loss after tax.

The country’s first electronic settlements platform said on Wednesday transaction volumes through its main PEXA Exchange platform were up 53 per cent last month from a year earlier, supporting its forecast of revenue of $246.9 million this year, up from $221 million in the year to June.

The company’s net loss after tax of $11.8 million would likely narrow to $2.5 million. EBITDA earnings would likely fall to $75.6 million from $94.4 million, the company said.
“The positive property market conditions in the second half of FY21 have continued, and as we move into the coming year, we have reaffirmed our prospectus forecasts for FY22,” PEXA chief executive Glenn King said.
Click to expand...
“Our strategy to leverage our position as the operator of Australia’s leading digital property settlements platform is delivering attractive results.”
Click to expand...

At the start of July, PEXA said property market volumes remained strong at the end of FY21 and that transactions in the fourth quarter were more than 4 per cent over predictions in its pre-listing prospectus and more than 48 per cent over the same quarter a year earlier.

PEXA said it was developing strategy to expand into the UK and that market scoping had also begun in New Zealand.
 
Ally Selby (Livewire Markets) : Next up we have PEXA, which was listed on the ASX on 01 July this year. Nathan, I’ll stay on you, is it a buy, hold or sell?

Nathan Hughes (Perpetual) : Again it’s a sell, Ally, but really that is valuation driven. I mean, PEXA is a really unique business. So they’re dominant in the Australian market. They’ve solved a problem for the industry and we think their competitive position here is relatively assured. I don’t think that competition, whilst it’s there, I don’t think it’s going to impact them because of their first-mover advantage and the links that they’ve built with industry participants, be it conveyances or banks and the like. There are some concerns that pricing might be kept under check here, domestically. And also, I think in today’s valuation, you are assuming success offshore, which comes with execution risk, time and considerable investment.

Ally Selby (Livewire Markets) : Mike, its share price has plummeted around 6% since it listed. Is it a buy, hold or sell?

Mike Murray (Australian Ethical) : I don’t disagree with Nathan’s comments about the business, except we have a different view on the opportunity. I’m going to call it a buy. We own the stock. And really it comes back to the fact that stocks like this rarely look attractive on near-term earnings. We’re believers in the long-term opportunity here. And I think the experience with these kinds of platform-style businesses has been, they tend to grow for longer periods of time at higher rates than might be apparent when they first list, so we like this one.
 
Positive property market conditions experienced during 1H22, coupled with deeper penetration in key States delivered 60% of PEXA Exchange’s FY22 Prospectus volumes in the first half.

As a result, PEXA is now expecting to exceed its FY22 Prospectus forecasts, and has upgraded guidance across key financial metrics:

A$ million ................FY22F Updated .......... FY22F
Prospectus Revenue ........ 265.0 – 275.0 ... was 246.9
PEXA Exchange EBITDA ... 140.0 – 150.0 ... was 126.3
Pro Forma EBITDA ............120.0 – 130.0 ... was 107.6
Pro Forma NPATA ................ 70.0 – 80.0 .... was 59.2
Statutory EBITDA ................. 95.0 – 105.0 .... was 75.6
Statutory NPATA ................... 55.0 – 65.0 .... was 37.0
 
Bought 10 grand worth at $ 16.55, bang on closing time .
Will hold on until there's a takeover.
Someone will have a go at it, I believe.
It's a better proposition than Link Group, anyway.
 
Dona Ferentes said:
PXA has had a silent Santa rally. No real news, but at a high since IPO
Click to expand...
and now, with interest rates rising and property sales reportedly taking longer plus sellers playing wait-n-see, it would seem PXA may be struggling.

$15 to $12.50 in the first two weeks of June, and this is the low since listing a year ago.

Not helping is the intervention by the ACCC in a mooted takeover for Link (LNK)
While the regulator is happy to see Dye & Durham acquire Link’s core back-office financial services business, it has concerns about the Canadian company getting Link’s 42.8 per cent stake in property transactions exchange PEXA.
Click to expand...

Dye & Durham owns GlobalX, which is one of the software providers that solicitors use to access PEXA, and SAI Global’s property division. It bought both last year.
 

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