Blue Lotus China New Economy Research, Blue Lotus Research Institute

Eric Wen

Blue Lotus China New Economy Research

China growth and global non-US Internet equities

Blue Lotus Research Institute

Blue Lotus Research is a Hong Kong Type 4 Licensed investment advisory firm focusing on Chinese growth equities and global non-US Internet equities

Thematic (Sector/Industry)

<ul>
<li>It has become evident that Chinese economy needs stimulus. But why is it not happening? The latest by NDRC and MOF suggests US rate and presidential election are the keys;</li>
<li>What has come forward in the forms of local government debt swap and bank reserve injection is similar to fueling a liquid-fueled missile. Once it starts, it can't roll back;</li>
<li>The biggest swing factor from US presidential election is the Trump Tariff, which can cut China's GDP growth by half. The fueling hopefully can handle impact of such magnitude.</li>
</ul>


It has become evident that Chinese economy needs stimulus. But why is it not happening? The latest by NDRC and MOF suggests US rate and presidential election are the keys;
What has come forward in the forms of local government debt swap and bank reserve injection is similar to fueling a liquid-fueled missile. Once it starts, it can't roll back;
The biggest swing factor from US presidential election is the Trump Tariff, which can cut China's GDP growth by half. The fueling hopefully can handle impact of such magnitude.


What Is Chinese Government Waiting for to Stimulate Its Economy?

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/jd-industrial-technology-ltd" target="_blank" data-smartkarma-citation="entities:36875:1" rel="noopener">JD Industrial Technology</a> is looking to raise about US$1bn in its upcoming HK IPO.</li>
<li>JDI is a leading industrial supply chain technology and service provider in China in terms of GMV in each year during the Track Record Period, according to CIC.</li>
<li>We have looked at the company background and provided our initial thoughts on valuations in our previous notes. In this note, we will talk about the refiling updates.</li>
</ul>



JD Industrial Technology is looking to raise about US$1bn in its upcoming HK IPO.
JDI is a leading industrial supply chain technology and service provider in China in terms of GMV in each year during the Track Record Period, according to CIC.
We have looked at the company background and provided our initial thoughts on valuations in our previous notes. In this note, we will talk about the refiling updates.


JD Industrials Pre-IPO - Refiling Updates - Few Hits, Few Misses

Asia Pac IPO & Placement Research, China biotech, Aequitas Research

Ke Yan, CFA, FRM

Asia Pac IPO & Placement Research, China biotech

Quantitative Analysis

<ul>
<li>We analyzed the latest HK SFC report for aggregate short position as of Oct 4th.</li>
<li>Top short increases and decreases were tabulated for one week and four week period. </li>
<li>We highlight short changes in Meituan, Citic Sec, Hkex, Trip.Com, ICBC, CCB, New World Dev.</li>
</ul>


We analyzed the latest HK SFC report for aggregate short position as of Oct 4th.
Top short increases and decreases were tabulated for one week and four week period. 
We highlight short changes in Meituan, Citic Sec, Hkex, Trip.Com, ICBC, CCB, New World Dev.


HK Short Interest Weekly: Meituan, Citic Sec, Hkex, Trip.Com, ICBC, CCB, New World Dev

External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

Equity Bottom-Up

<ul><li>We expect JD to deliver inline-with-Bloomberg consensus revenue growth and a better-than-expected non-GAAP net profit for 3Q24, aided by efficient cost control, and a YoY increase in revenue contribution from services revenue.</li><li>Amid improving consumption sentiment since September, and benefiting from the implementation of home appliance trade-in program nationwide, JD is marginally shifting its emphasis from ROI and cost control to more on GMV and revenue growth.</li><li>Post the recent market rally, quality and sustainable earnings growth of core business as well as enhancement of shareholder return remain key to driving further upside in JD’s stock price, in our view. </li></ul><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

We expect JD to deliver inline-with-Bloomberg consensus revenue growth and a better-than-expected non-GAAP net profit for 3Q24, aided by efficient cost control, and a YoY increase in revenue contribution from services revenue.Amid improving consumption sentiment since September, and benefiting from the implementation of home appliance trade-in program nationwide, JD is marginally shifting its emphasis from ROI and cost control to more on GMV and revenue growth.Post the recent market rally, quality and sustainable earnings growth of core business as well as enhancement of shareholder return remain key to driving further upside in JD’s stock price, in our view. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

JD.com (JD US) - Expecting Inline 3Q Revenue Growth with Upside Coming from Bottom Line

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/sun-art-retail-group-ltd" target="_blank" data-smartkarma-citation="entities:401:1" rel="noopener">Sun Art Retail (6808 HK)</a> entered a trading halt under the Code on Takeovers and Mergers. Bloomberg suggests <a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd" target="_blank" data-smartkarma-citation="entities:787:1" rel="noopener">Alibaba Group Holding (BABA US)</a>’s stake is attracting preliminary interest from PE.</li>
<li>Alibaba built its 78.70% stake through two purchases in 2017 (HK$6.50) and 2021 (HK$8.10). An exit would align with the strategy to focus on the core business segments. </li>
<li>The recent Miniso-Yonghui transaction could have prompted PE to act. An offer at book value would imply HK$2.50, a 40% premium to the last close price. </li>
</ul>



Sun Art Retail (6808 HK) entered a trading halt under the Code on Takeovers and Mergers. Bloomberg suggests Alibaba Group Holding (BABA US)’s stake is attracting preliminary interest from PE.
Alibaba built its 78.70% stake through two purchases in 2017 (HK$6.50) and 2021 (HK$8.10). An exit would align with the strategy to focus on the core business segments. 
The recent Miniso-Yonghui transaction could have prompted PE to act. An offer at book value would imply HK$2.50, a 40% premium to the last close price. 


Sun Art Retail (6808 HK): Alibaba’s Stake Draws PE Interest

China

JD.com Inc is an online direct sales company in China.  The Company offers a wide selection of products through its website and mobile applications.  JD.com sells appliances, computers, digital products, communication products, garments, books, and household items to consumers and vendors.

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JD.com (ADR) (JD US)

What Is Chinese Government Waiting for to Stimulate Its Economy?

Chinese economy needs stimulus but it's not happening due to US rate and election uncertainties. Debt swap and reserve injection are getting...

Blue Lotus Research Institute

JD Industrials Pre-IPO - Refiling Updates - Few Hits, Few Misses

JD Industrial Technology is looking to raise about US$1bn in its upcoming HK IPO. We have looked at its past performance in our earlier notes. In...

Sumeet Singh

HK Short Interest Weekly: Meituan, Citic Sec, Hkex, Trip.Com, ICBC, CCB, New World Dev

We analyzed the latest HK SFC report for aggregate short position as of Oct 4th and highlight short interest changes in Meituan, Citic Sec, Hkex,...

Ke Yan, CFA, FRM

JD.com (JD US) - Expecting Inline 3Q Revenue Growth with Upside Coming from Bottom Line

We expect JD to deliver inline-with-Bloomberg consensus revenue growth and a better-than-expected non-GAAP net profit for 3Q24, aided by efficient...

CMB International

Sun Art Retail (6808 HK): Alibaba’s Stake Draws PE Interest

On 27 September, the Board received a pre-conditional voluntary conditional offer from an undisclosed offeror. No terms are disclosed. Alibaba is...

Arun George

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

What Is Chinese Government Waiting for to Stimulate Its Economy?

​Chinese economy needs stimulus but it's not happening due to US rate and election uncertainties. Debt swap and reserve injection are getting...

Blue Lotus Research Institute

JD Industrials Pre-IPO - Refiling Updates - Few Hits, Few Misses

JD Industrial Technology is looking to raise about US$1bn in its upcoming HK IPO. We have looked at its past performance in our earlier notes. In...

Sumeet Singh

HK Short Interest Weekly: Meituan, Citic Sec, Hkex, Trip.Com, ICBC, CCB, New World Dev

We analyzed the latest HK SFC report for aggregate short position as of Oct 4th and highlight short interest changes in Meituan, Citic Sec, Hkex,...

Ke Yan, CFA, FRM

JD.com (JD US) - Expecting Inline 3Q Revenue Growth with Upside Coming from Bottom Line

We expect JD to deliver inline-with-Bloomberg consensus revenue growth and a better-than-expected non-GAAP net profit for 3Q24, aided by efficient...

CMB International

Sun Art Retail (6808 HK): Alibaba’s Stake Draws PE Interest

On 27 September, the Board received a pre-conditional voluntary conditional offer from an undisclosed offeror. No terms are disclosed. Alibaba is...

Arun George

Chinese economy needs stimulus but it's not happening due to US rate and election uncertainties. Debt swap and reserve injection are getting...