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/hangzhou-kangji-medical-instrument-co-ltd" target="_blank" data-smartkarma-citation="entities:28938:1" rel="noopener">Hangzhou Kangji Medical Instrument Co., Ltd. (9997 HK)</a> disclosed a preconditional privatisation from a consortium at HK$9.25, a 9.9% premium to last close and a 21.7% premium to the undisturbed price. </li>
<li>The precondition relates to SAMR approval. The key condition will be approval by at least 75% disinterested shareholders (&lt;10% of all disinterested shareholders' rejection). The offer is final. </li>
<li>The scheme vote risk is medium-to-high due to an unattractive offer, a blocking stake below the substantial disclosure threshold, unfavourable AGM voting patterns, and emerging retail opposition.</li>
</ul>



Hangzhou Kangji Medical Instrument Co., Ltd. (9997 HK) disclosed a preconditional privatisation from a consortium at HK$9.25, a 9.9% premium to last close and a 21.7% premium to the undisturbed price. 
The precondition relates to SAMR approval. The key condition will be approval by at least 75% disinterested shareholders (&lt;10% of all disinterested shareholders' rejection). The offer is final. 
The scheme vote risk is medium-to-high due to an unattractive offer, a blocking stake below the substantial disclosure threshold, unfavourable AGM voting patterns, and emerging retail opposition.


Kangji Medical (9997 HK): Consortium’s Light Preconditional Scheme Offer

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Index Rebalance

<ul>
<li>A methodology change for the Hang Seng Biotech Index (HSHKBIO Index) will result in 20 deletions at the close of trading on 5 September.</li>
<li>Estimated one-way turnover at the rebalance is 9.5% resulting in a round-trip trade of HK$1.3bn (US$162m). Passive trackers need to sell between 0.05-1x ADV in the deletes.</li>
<li>The forecast deletes have underperformed the other index constituents since the start of the year but there has been little movement since the announcement of the methodology change.</li>
</ul>


A methodology change for the Hang Seng Biotech Index (HSHKBIO Index) will result in 20 deletions at the close of trading on 5 September.
Estimated one-way turnover at the rebalance is 9.5% resulting in a round-trip trade of HK$1.3bn (US$162m). Passive trackers need to sell between 0.05-1x ADV in the deletes.
The forecast deletes have underperformed the other index constituents since the start of the year but there has been little movement since the announcement of the methodology change.


Hang Seng Biotech Index Rebalance Preview: Methodology Change Leads to 20 Deletions

Asia Pac ECM and Index Rebal, Shenton Research

Ke Yan, CFA, FRM

Asia Pac ECM and Index Rebal

Asia Pac IPO & Placement Research, China Biotech

DZT Research

DZT Research is an independent Asia Pacific equity specialist. Our quantitative research covers index rebalancing flows, alongside exchange data analytics accross Asia Pacific. On the equity capital markets side, we focus on Asia Pacific ECM, especially biotech and TMT. Our lead analyst is frequently cited by international media.

Quantitative Analysis

<ul>
<li>We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of August 8th.</li>
<li>The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.</li>
<li>We highlight flows for Tencent, Kuaishou, Alibaba, Meituan, Li Auto, China Mobile.</li>
</ul>


We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of August 8th.
The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.
We highlight flows for Tencent, Kuaishou, Alibaba, Meituan, Li Auto, China Mobile.


HK Connect Flows Weekly (Aug 8th): Tencent, Kuaishou, Alibaba, Meituan, Li Auto, China Mobile

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Capital Markets

<ul>
<li>A key point of the press conference held by the NHSA is that the selection in centralized procurement of medical devices will no longer be based on the lowest price.</li>
<li>Investors have high hopes for the licensing cooperation of IBI363. Our guess is a 50:50 licensing deal with MNC is expected, so as to maximize the value/potential of the drug.</li>
<li>Considering Li Ge's rich experience in capital operation, WuXi AppTec’s Placement implies its H-share is already at high level.Investors can consider taking profits, as share price adjustment may be coming.</li>
</ul>


A key point of the press conference held by the NHSA is that the selection in centralized procurement of medical devices will no longer be based on the lowest price.
Investors have high hopes for the licensing cooperation of IBI363. Our guess is a 50:50 licensing deal with MNC is expected, so as to maximize the value/potential of the drug.
Considering Li Ge's rich experience in capital operation, WuXi AppTec’s Placement implies its H-share is already at high level.Investors can consider taking profits, as share price adjustment may be coming.


China Healthcare Weekly (Aug.3)-Medical Device Valuation Repair,Deal on IBI363,WuXi AppTec Placement

<ul>
<li>We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of July 18th.</li>
<li>The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.</li>
<li>We highlight flows for Meituan, CCB, Alibaba, Ping An Insurance, Akeso, Tencent, Xiaomi, Pop Mart Intl, ABC, Xpeng.</li>
</ul>


We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of July 18th.
The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.
We highlight flows for Meituan, CCB, Alibaba, Ping An Insurance, Akeso, Tencent, Xiaomi, Pop Mart Intl, ABC, Xpeng.


HK Connect Flows Weekly (Jul 18th): Meituan, CCB, Alibaba, Ping An Insurance, Akeso, Tencent, Xiaomi

China

Specializes in the research, development, manufacture, and sale of artificial joint prostheses & their associated surgical instruments and applications

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AK Medical Holdings Limited (1789 HK)

Kangji Medical (9997 HK): Consortium’s Light Preconditional Scheme Offer

The scheme vote risk is medium-to-high due to an unattractive offer, a blocking stake below the substantial disclosure threshold, unfavourable AGM...

Arun George

Hang Seng Biotech Index Rebalance Preview: Methodology Change Leads to 20 Deletions

A methodology change could lead to 20 deletions in Sep. Estimated one-way turnover at the rebalance is 9.5% resulting in a round-trip trade of...

Brian Freitas

HK Connect Flows Weekly (Aug 8th): Tencent, Kuaishou, Alibaba, Meituan, Li Auto, China Mobile

We analyzed southbound Hong Kong connect flows in the past week and highlighted flows for Tencent, Kuaishou, Alibaba, Meituan, Li Auto, China Mobile.

Ke Yan, CFA, FRM

China Healthcare Weekly (Aug.3)-Medical Device Valuation Repair,Deal on IBI363,WuXi AppTec Placement

NHSA shifts focus from lowest price to quality in medical device VBP, indicating valuation repair.IBI363 license deal with MNC is expected. WuXi...

Xinyao (Criss) Wang

HK Connect Flows Weekly (Jul 18th): Meituan, CCB, Alibaba, Ping An Insurance, Akeso, Tencent, Xiaomi

We analyzed the Hong Kong Connect Scheme for last week and highlighted flows for Meituan, CCB, Alibaba, Ping An Insurance, Akeso, Tencent, Xiaomi,...

Ke Yan, CFA, FRM

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Kangji Medical (9997 HK): Consortium’s Light Preconditional Scheme Offer

The scheme vote risk is medium-to-high due to an unattractive offer, a blocking stake below the substantial disclosure threshold, unfavourable AGM...

Arun George

Hang Seng Biotech Index Rebalance Preview: Methodology Change Leads to 20 Deletions

A methodology change could lead to 20 deletions in Sep. Estimated one-way turnover at the rebalance is 9.5% resulting in a round-trip trade of...

Brian Freitas

HK Connect Flows Weekly (Aug 8th): Tencent, Kuaishou, Alibaba, Meituan, Li Auto, China Mobile

We analyzed southbound Hong Kong connect flows in the past week and highlighted flows for Tencent, Kuaishou, Alibaba, Meituan, Li Auto, China Mobile.

Ke Yan, CFA, FRM

China Healthcare Weekly (Aug.3)-Medical Device Valuation Repair,Deal on IBI363,WuXi AppTec Placement

​NHSA shifts focus from lowest price to quality in medical device VBP, indicating valuation repair.IBI363 license deal with MNC is expected. WuXi...

Xinyao (Criss) Wang

HK Connect Flows Weekly (Jul 18th): Meituan, CCB, Alibaba, Ping An Insurance, Akeso, Tencent, Xiaomi

We analyzed the Hong Kong Connect Scheme for last week and highlighted flows for Meituan, CCB, Alibaba, Ping An Insurance, Akeso, Tencent, Xiaomi,...

Ke Yan, CFA, FRM

NHSA shifts focus from lowest price to quality in medical device VBP, indicating valuation repair.IBI363 license deal with MNC is expected. WuXi...