Overseas Chinese Equities, Aequitas Research

Ming Lu

Overseas Chinese Equities

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 Bottom-Up

Tencent is not an overheated company riding on the home quarantine. On the contrary, we believe  the competitors to all Tencent's business lines are in trouble. These provide Tencent another opportunity of upside.
The 6-year P/E Band suggests an upside of 24% for the end of 2021 and a price target. We upgraded Tencent to "buy" after the release of the 3Q20 result. Now we raise our price target from HK$660 to HK$700.

Tencent is not an overheated company riding on the home quarantine. On the contrary, we believe  the competitors to all Tencent's business lines are in trouble. These provide Tencent another opportunity of upside.
The 6-year P/E Band suggests an upside of 24% for the end of 2021 and a price target. We upgraded Tencent to "buy" after the release of the 3Q20 result. Now we raise our price target from HK$660 to HK$700.

2021 High Conviction: Long Tencent as All Competitors Are in Trouble

Asian Equities Analyst, Logistics & Transport, Tracking Traffic

Daniel Hellberg

Asian Equities Analyst, Logistics & Transport

Tracking Traffic

Focusing on Asian logistics, transportation, and travel companies

In this new monthly research product we introduce three Long / Short pair trade ideas in Chinese travel, Chinese express and logistics, and global container shipping. 
These pair trade ideas are based mainly on expected fundamental change in each segment over the next 6-12 months. We'll focus on Asia, but occasionally we may place non-Asian names on either side of our pair ideas. Besides examining key secular and cyclical trends in each segment, we will consider relative valuations, and we'll strive to identify key catalysts and risks for each stock. 
Broadly, the idea behind this new product is to identify and own companies we expect to profitably gain share or to reap outsized benefits from important secular and cyclical trends, then short names in the same segment that stand to lose the most to the 'winners' we select. 
We'll be back in about a month with our first updates on these three proposed pairs!

In this new monthly research product we introduce three Long / Short pair trade ideas in Chinese travel, Chinese express and logistics, and global container shipping. 
These pair trade ideas are based mainly on expected fundamental change in each segment over the next 6-12 months. We'll focus on Asia, but occasionally we may place non-Asian names on either side of our pair ideas. Besides examining key secular and cyclical trends in each segment, we will consider relative valuations, and we'll strive to identify key catalysts and risks for each stock. 
Broadly, the idea behind this new product is to identify and own companies we expect to profitably gain share or to reap outsized benefits from important secular and cyclical trends, then short names in the same segment that stand to lose the most to the 'winners' we select. 
We'll be back in about a month with our first updates on these three proposed pairs!

TRACKING TRAFFIC/Three Suggested Pair Trades in Travel, Express & Shipping

<ul class="">
<li>Alibaba (BABA) is selling BigBasket.com to Tata Group.</li>
<li>It is rumored that Alibaba (BABA) will dismiss the Xiami Music team.</li>
<li>Xiaomi (1810 HK) issued 1 billion shares at the price of HK$23.70.</li>
<li>Trip.com (TCOM)’s revenue decreased by 48% yoy in 3Q20.</li>
</ul>


Alibaba (BABA) is selling BigBasket.com to Tata Group.
It is rumored that Alibaba (BABA) will dismiss the Xiami Music team.
Xiaomi (1810 HK) issued 1 billion shares at the price of HK$23.70.
Trip.com (TCOM)’s revenue decreased by 48% yoy in 3Q20.


China Internet Weekly (7Dec2020): Alibaba Withdrawing from India and Domestic Music Market

Alpha-Centric ESG Research

Kyle Rudden

In <a href="https://www.smartkarma.com/insights/delisting-deceitful-chinese-companies-act-not-a-slam-dunk-and-has-more-bark-than-bite-if-it-passes" target="_blank" data-smartkarma-citation="insights:40025" rel="noopener">"Delisting Deceitful Chinese Companies Act" Not a Slam Dunk and Has More Bark Than Bite if It Passes</a>, I made three "predictions." First, the U.S. House of Representatives would not get around to voting on the "delisting act" before the end of the Congressional session. Second, if the House does vote, it would likely pass the bill. Third, if the bill passes, it would have more bark than bite.As a bloke called Meat Loaf once sung, "two out of three ain't bad."On Wednesday, the House voted and passed Senate Bill 945, titled the "Holding Foreign Companies Accountable Act." That the House managed to vote amidst the dual chaos of a raging pandemic and an unhinged President – so close to adjourning this 116th Congress – is a surprise. That it voted to pass S945 is not at all surprising, however, given widespread bi-partisan support for the bill.The real epiphany comes from additional details provided during House testimony just prior to the vote. Not many, but those details that were disclosed (plus the tone in which they were articulated) shed light on how S945 will be implemented and enforced by the SEC, and why foreign issuers and investors should duly-cautious but not overly-concerned. And why this "delisting bill" is ...... more bark than bite.This Insight presents an updated analysis of S945 (general and China/Hong Kong-specific aspects), shares new details provided by Representative Brad Sherman, offers an opinion on the SEC's likely approach to writing and enforcing S945 rules, analyses China/Hong Kong stocks most at risk under S945, and stocks affected by the France/Belgium angle (similar to China/Hong Kong).

In "Delisting Deceitful Chinese Companies Act" Not a Slam Dunk and Has More Bark Than Bite if It Passes, I made three "predictions." First, the U.S. House of Representatives would not get around to voting on the "delisting act" before the end of the Congressional session. Second, if the House does vote, it would likely pass the bill. Third, if the bill passes, it would have more bark than bite.As a bloke called Meat Loaf once sung, "two out of three ain't bad."On Wednesday, the House voted and passed Senate Bill 945, titled the "Holding Foreign Companies Accountable Act." That the House managed to vote amidst the dual chaos of a raging pandemic and an unhinged President – so close to adjourning this 116th Congress – is a surprise. That it voted to pass S945 is not at all surprising, however, given widespread bi-partisan support for the bill.The real epiphany comes from additional details provided during House testimony just prior to the vote. Not many, but those details that were disclosed (plus the tone in which they were articulated) shed light on how S945 will be implemented and enforced by the SEC, and why foreign issuers and investors should duly-cautious but not overly-concerned. And why this "delisting bill" is ...... more bark than bite.This Insight presents an updated analysis of S945 (general and China/Hong Kong-specific aspects), shares new details provided by Representative Brad Sherman, offers an opinion on the SEC's likely approach to writing and enforcing S945 rules, analyses China/Hong Kong stocks most at risk under S945, and stocks affected by the France/Belgium angle (similar to China/Hong Kong).

House Passes "Delisting Act" Giving SEC 90 Days to Write Its Rules (And Yes, More Bark Than Bite)

Silver Point

Thomas J. Monaco

Silver Point is a boutique research firm that focuses on the broader financial services sector, with a particular focus on troubled institutions globally. 

Asia Ex Japan

*Decent Operating Results: Lufax Holdings (LU.US) [Lufax] reported 3Q20 results of CNY 2.2 bn, declining CNY 929 mn (30.1%) on a linked quarter basis. However, when we exclude the CNY 1.3 bn restructuring charge and gains of CNY 144 mn, Lufax’ operating results amounted to CNY 3.3 bn – increasing CNY 228 mn (7.3%) over the same period;  and*Regulatory Risk Is Prevalant: An evolution of the regulatory environment remains a significant challenge to Lufax, and more likely than not will require further business adjustments and ad pressure to the bottom-line, including: lower interest rate caps;  higher capital requirements; improved risk-taking controls; along with other consumer protection measures. That being said, much of the regulatory uncertainty is more from policy window guidance rather than from new regulations themselves.

*Decent Operating Results: Lufax Holdings (LU.US) [Lufax] reported 3Q20 results of CNY 2.2 bn, declining CNY 929 mn (30.1%) on a linked quarter basis. However, when we exclude the CNY 1.3 bn restructuring charge and gains of CNY 144 mn, Lufax’ operating results amounted to CNY 3.3 bn – increasing CNY 228 mn (7.3%) over the same period;  and*Regulatory Risk Is Prevalant: An evolution of the regulatory environment remains a significant challenge to Lufax, and more likely than not will require further business adjustments and ad pressure to the bottom-line, including: lower interest rate caps;  higher capital requirements; improved risk-taking controls; along with other consumer protection measures. That being said, much of the regulatory uncertainty is more from policy window guidance rather than from new regulations themselves. 

Lufax Holdings – Good Number Right Out Of The Gate

China

Alibaba Group Holding Limited provides online sales services. The Company provides internet infrastructure, electronic commerce, online financial, and internet content services through its subsidiaries. Alibaba Group Holding offers its products and services worldwide.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Alibaba (BABA US)

2021 High Conviction: Long Tencent as All Competitors Are in Trouble

Tencent is not an overheated company riding on the home quarantine. All the competitors to all Tencent's business lines are in trouble. These...

Ming Lu

TRACKING TRAFFIC/Three Suggested Pair Trades in Travel, Express & Shipping

We're introducing a monthly pair trade idea product to go along with our monthly products covering Chinese travel and tourism, Chinese express, and...

Tracking Traffic

China Internet Weekly (7Dec2020): Alibaba Withdrawing from India and Domestic Music Market

Alibaba (BABA) are selling BigBasket.com to Tata Group in India and will dismiss Xiami Music in China. Xiaomi will issue new shares.

Ming Lu

House Passes "Delisting Act" Giving SEC 90 Days to Write Its Rules (And Yes, More Bark Than Bite)

The U.S. House of Representatives passed Senate Bill 945, the "Holding Foreign Companies Accountable Act." New details support the notion that S945...

Kyle Rudden

Lufax Holdings – Good Number Right Out Of The Gate

LUFAX HOLDINGS: Lufax operating results were solid. However, the regulatory environment remains a significant challenge.

Thomas J. Monaco

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)