Independent research on the U.S. markets, Baptista Research

Baptista Research

Independent research on the U.S. markets

Baptista Research is an independent financial research house focused on the U.S. markets. We provide equity research as well as credit research reports on the top-listed U.S. companies with most of our focus on technology, consumer goods and services, automobiles, industrials, oil and gas, pharma, and healthcare. Our research has served more than 3000 institutional investors including mutual funds, hedge funds, banks, family offices, and various buy-side firms. We operate a research subscription service where institutions, as well as retail investors, can have priority access to all our research. We also have a wide distribution of our research reports across some of the top global financial platforms. Apart from equity research and credit research, we also provide advisory services with respect to mergers & acquisitions (M&A), private equity/ venture capital fundraising, valuation reports, and investment management services for corporates.
Baptista Research is owned and managed by Ishan Majumdar, an ex-Venture Capitalist/ Investment Banker, a Chartered Accountant, and a Masters’ degree holder in Management from HEC Paris. Ishan has nearly a decade of experience in Mergers and Acquisitions, Leveraged Buyouts (LBOs), Venture Capital Investing, Corporate Strategy, and Valuation in front-office roles at the likes of BNP Paribas CIB, Credit Agricole CIB, Groupe Danone, and TIW Private Equity. He has worked on and closed multiple acquisition deals, leveraged buyouts, and start-up investment transactions.

Equity Bottom-Up

<ul><li>HSBC Holdings plc reported a solid financial performance for the third quarter of 2024, reflecting the effectiveness of its ongoing strategic initiatives.</li><li>Key points from the earnings call highlight the firm’s continued growth, strategic restructuring, and some external influences, creating a nuanced outlook for potential investors.</li><li>On the financial front, HSBC posted a profit before tax of $8.5 billion, marking an 11% increase compared to the same period last year, on a constant currency basis.</li></ul>

HSBC Holdings plc reported a solid financial performance for the third quarter of 2024, reflecting the effectiveness of its ongoing strategic initiatives.Key points from the earnings call highlight the firm’s continued growth, strategic restructuring, and some external influences, creating a nuanced outlook for potential investors.On the financial front, HSBC posted a profit before tax of $8.5 billion, marking an 11% increase compared to the same period last year, on a constant currency basis.

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>Since announcing <a href="https://www.smartkarma.com/entities/hsbc-holdings-plc" target="_blank" data-smartkarma-citation="entities:516:1" rel="noopener">HSBC (5 HK)</a>'s Offer, <a href="https://www.smartkarma.com/entities/hang-seng-bank-ltd" target="_blank" data-smartkarma-citation="entities:24:1" rel="noopener">Hang Seng Bank (11 HK)</a> has traded tight-ish to terms, at a ~3.9% gross spread (including dividends). Or ~10% annualised if a five month offramp.</li>
<li>Annualised spreads for clean liquid deals in Asia-Pac, do tend to widen after day 1. Meaning, the gross spread remains roughly static as investors hit their full quota early on.  </li>
<li>HSBC shareholders are questioning the deal merits. For Hang Seng minorities, this is a great exit. Inside this report, I take a deeper dive into Hong Kong bank takeover precedents.
</li>
</ul>


Since announcing HSBC (5 HK)'s Offer, Hang Seng Bank (11 HK) has traded tight-ish to terms, at a ~3.9% gross spread (including dividends). Or ~10% annualised if a five month offramp.
Annualised spreads for clean liquid deals in Asia-Pac, do tend to widen after day 1. Meaning, the gross spread remains roughly static as investors hit their full quota early on.  
HSBC shareholders are questioning the deal merits. For Hang Seng minorities, this is a great exit. Inside this report, I take a deeper dive into Hong Kong bank takeover precedents.



Hang Seng (11 HK)'s Offer: HSBC Investors Are Not Sold On The Strategic Benefits

Research and consultancy, Tabbush Report

Daniel Tabbush

Research and consultancy

Tabbush Report

We provide research and consultancy on Asian banks. Our focus is on what we call “Asian bank research, without the noise.” We are interested in the most critical swing-factors for banks, the NPL and credit cycle, and where we believe there is a gap between perception and reality. We often focus on the less studied components of bank financial statements.  Our research is highly thematic, sometimes examining unlisted banks and companies as a window on mainstream banks. 

Being independent allows us to look at smaller banks, often overlooked by others. Analysis of BIS bank guidelines in the context of Asia, is also a focal point, while we also analyze global banks operating in the region. We use what we believe is the most comprehensive, reliable financials database, SNL Financial. S&P Capital IQ augments our database, with corporate data and CEIC, with economics. 

Asian bank research, without the noise.

Thematic (Sector/Industry)

<ul>
<li>There is strong and accelerating growth visible in HFD for US banks, even in the very core bucket of C&amp;I loans</li>
<li>Most recent full month shows 10.1% growth YoY for C&amp;I but Other Loans are up 27.3% Yoy in the same month, which is partly C&amp;I</li>
<li>Deposit distribution is improving, toward CASA, US banks can see better NIM, and net interest income, while economy appears from weekly bank data</li>
</ul>


There is strong and accelerating growth visible in HFD for US banks, even in the very core bucket of C&amp;I loans
Most recent full month shows 10.1% growth YoY for C&amp;I but Other Loans are up 27.3% Yoy in the same month, which is partly C&amp;I
Deposit distribution is improving, toward CASA, US banks can see better NIM, and net interest income, while economy appears from weekly bank data


US Banks - C&I Loans +10.1% YoY in Apr From -2.9% in Jan, Strong Read-Through, Banks & Economy

HK/China Equity Long-Short

Osbert Tang, CFA

<ul>
<li>
<a href="https://www.smartkarma.com/entities/sichuan-kelun-biotech-biopharm" target="_blank" data-smartkarma-citation="entities:40071:1" rel="noopener">Sichuan Kelun-Biotech Bio (6990 HK)</a>, <a href="https://www.smartkarma.com/entities/techtronic-industries-co-ltd" target="_blank" data-smartkarma-citation="entities:4561:1" rel="noopener">Techtronic Ind. (669 HK)</a>, <a href="https://www.smartkarma.com/entities/vesync" target="_blank" data-smartkarma-citation="entities:31067:1" rel="noopener">Vesync (2148 HK)</a>, <a href="https://www.smartkarma.com/entities/chervon-holdings-limited" target="_blank" data-smartkarma-citation="entities:35309:1" rel="noopener">Chervon Hldgs (2285 HK)</a>, and <a href="https://www.smartkarma.com/entities/wuxi-apptec-co-ltd-bf4a1265-beef-48b6-b82d-29308426030f" target="_blank" data-smartkarma-citation="entities:27795:1" rel="noopener">WuXi AppTec (2359 HK)</a> have a very high reliance on the US market.</li>
<li>
<a href="https://www.smartkarma.com/entities/vtech-holdings-ltd" target="_blank" data-smartkarma-citation="entities:18812:1" rel="noopener">Vtech Hldgs (303 HK)</a>, <a href="https://www.smartkarma.com/entities/samsonite-international-sa" target="_blank" data-smartkarma-citation="entities:12790:1" rel="noopener">Samsonite (1910 HK)</a>, <a href="https://www.smartkarma.com/entities/haier-smart-home-co-ltd-b3ef445f-0f54-4586-8c58-9073de98d60e" target="_blank" data-smartkarma-citation="entities:31105:1" rel="noopener">Haier Smart Home (6690 HK)</a>, and <a href="https://www.smartkarma.com/entities/tcl-multimedia-technology" target="_blank" data-smartkarma-citation="entities:15654:1" rel="noopener">Tcl Multimedia (1070 HK)</a> ranked lower on the list, but consumer cutbacks will have a bigger impact. </li>
<li>The spillover effect of a US recession to other countries will pressurise companies that have low direct exposure, like <a href="https://www.smartkarma.com/entities/orient-overseas-international" target="_blank" data-smartkarma-citation="entities:801:1" rel="noopener">Orient Overseas International (316 HK)</a> and <a href="https://www.smartkarma.com/entities/prada-s-p-a" target="_blank" data-smartkarma-citation="entities:889:1" rel="noopener">Prada S.P.A. (1913 HK)</a>.</li>
</ul>



Sichuan Kelun-Biotech Bio (6990 HK), Techtronic Ind. (669 HK), Vesync (2148 HK), Chervon Hldgs (2285 HK), and WuXi AppTec (2359 HK) have a very high reliance on the US market.

Vtech Hldgs (303 HK), Samsonite (1910 HK), Haier Smart Home (6690 HK), and Tcl Multimedia (1070 HK) ranked lower on the list, but consumer cutbacks will have a bigger impact. 
The spillover effect of a US recession to other countries will pressurise companies that have low direct exposure, like Orient Overseas International (316 HK) and Prada S.P.A. (1913 HK).


China & HK Strategy: Who Are the Victims of a US Recession?

Derivatives and Quantitative Strategist

Gaudenz Schneider

Equity Derivatives

<ul>
<li>Box trades are gaining popularity on the Hong Kong Stock Exchange. These arbitrage strategies exploit price discrepancies in options markets for near risk-free profits.</li>
<li>Long box trades involve simultaneously buying bull call spreads and bear put spreads with identical strikes and expiration dates, creating a fixed payoff regardless of the underlying asset's price movement.</li>
<li>Box trades require careful execution consideration of spreads, commissions, margins, and fees, with risks primarily in execution and operations rather than market exposure.</li>
</ul>


Box trades are gaining popularity on the Hong Kong Stock Exchange. These arbitrage strategies exploit price discrepancies in options markets for near risk-free profits.
Long box trades involve simultaneously buying bull call spreads and bear put spreads with identical strikes and expiration dates, creating a fixed payoff regardless of the underlying asset's price movement.
Box trades require careful execution consideration of spreads, commissions, margins, and fees, with risks primarily in execution and operations rather than market exposure.


Box Trades Explained: How Traders Execute Near Risk-Free Arbitrage in Hong Kong's Options Market

United Kingdom

HSBC Holdings plc is the holding company for the HSBC Group. The Company provides a variety of international banking and financial services, including retail and corporate banking, trade, trusteeship, securities, custody, capital markets, treasury, private and investment banking, and insurance.  The Group operates worldwide.

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HSBC Holdings (5 HK)

HSBC Holdings

HSBC Holdings plc reported a solid financial performance for the third quarter of 2024, reflecting the effectiveness of its ongoing strategic...

Baptista Research

Hang Seng (11 HK)'s Offer: HSBC Investors Are Not Sold On The Strategic Benefits

Hang Seng Bank (11 HK) has announced that the Scheme Doc dispatch will be pushed out to the 17 December 2025, a little under a week ahead of my...

David Blennerhassett

US Banks - C&I Loans +10.1% YoY in Apr From -2.9% in Jan, Strong Read-Through, Banks & Economy

HFD for US banks, shows very strong acceleration in C&I loans, and also other loans, which will also include C&I. Data suggests good economic...

Daniel Tabbush

China & HK Strategy: Who Are the Victims of a US Recession?

Reliance on the US market varies among HK-listed companies, with some having high direct exposure to a recession. Those with low direct exposure...

Osbert Tang, CFA

Box Trades Explained: How Traders Execute Near Risk-Free Arbitrage in Hong Kong's Options Market

JD.com (9618 HK) Earnings Call tonight 8:00 pm HKT. After yesterday's 3.06% move up, the ATM strike is now 165. Straddles offer an opportunity to...

Gaudenz Schneider

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

HSBC Holdings

HSBC Holdings plc reported a solid financial performance for the third quarter of 2024, reflecting the effectiveness of its ongoing strategic...

Baptista Research

Hang Seng (11 HK)'s Offer: HSBC Investors Are Not Sold On The Strategic Benefits

Hang Seng Bank (11 HK) has announced that the Scheme Doc dispatch will be pushed out to the 17 December 2025, a little under a week ahead of my...

David Blennerhassett

US Banks - C&I Loans +10.1% YoY in Apr From -2.9% in Jan, Strong Read-Through, Banks & Economy

HFD for US banks, shows very strong acceleration in C&I loans, and also other loans, which will also include C&I. Data suggests good economic...

Daniel Tabbush

China & HK Strategy: Who Are the Victims of a US Recession?

​Reliance on the US market varies among HK-listed companies, with some having high direct exposure to a recession. Those with low direct exposure...

Osbert Tang, CFA

Box Trades Explained: How Traders Execute Near Risk-Free Arbitrage in Hong Kong's Options Market

JD.com (9618 HK) Earnings Call tonight 8:00 pm HKT. After yesterday's 3.06% move up, the ATM strike is now 165. Straddles offer an opportunity to...

Gaudenz Schneider

Reliance on the US market varies among HK-listed companies, with some having high direct exposure to a recession. Those with low direct exposure...