HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Bottom-Up

Ping An Healthcare and Technology / Equity Bottom-Up

<ul>
<li>The “turning point” occurs as share price of innovative drug sector is pulling back. Many companies would see valuations halved - potentially more than once.The decline is far from over.</li>
<li>The current main goal of biotech is to turn losses into profits ASAP. If it fails to make a profit, it may not be recognized by the market.</li>
<li>Due to the concerns on <a href="https://www.smartkarma.com/entities/ping-an-healthcare-and-technology-company-limited" target="_blank" data-smartkarma-citation="entities:27008:1" rel="noopener">Ping An Healthcare and Technology (1833 HK)'s </a>business model, peak revenue scale could be just RMB8 billion. In other words, Ping An Healthcare is overvalued.</li>
</ul>


The “turning point” occurs as share price of innovative drug sector is pulling back. Many companies would see valuations halved - potentially more than once.The decline is far from over.
The current main goal of biotech is to turn losses into profits ASAP. If it fails to make a profit, it may not be recognized by the market.
Due to the concerns on Ping An Healthcare and Technology (1833 HK)'s business model, peak revenue scale could be just RMB8 billion. In other words, Ping An Healthcare is overvalued.


China Healthcare Weekly (Oct.19)-Bubble of HK Biotech Is Bursting, Ping An Good Doctor Is Overvalued

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

Sany Heavy Industry / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/sany-heavy-industry-co-ltd" target="_blank" data-smartkarma-citation="entities:20183:1" rel="noopener">Sany Heavy Industry (600031 CH)</a>, aims to raise around US$1.5bn in its H-share listing.</li>
<li>Sany Heavy Industry was the world’s third largest and China’s largest construction machinery company in terms of construction machinery’s cumulative revenue from 2020 to 2024, according to Frost &amp; Sullivan.</li>
<li>We have looked at the company’s past performance in our earlier note. In this note, we talk about the updates and likely A/H premium.</li>
</ul>



Sany Heavy Industry (600031 CH), aims to raise around US$1.5bn in its H-share listing.
Sany Heavy Industry was the world’s third largest and China’s largest construction machinery company in terms of construction machinery’s cumulative revenue from 2020 to 2024, according to Frost &amp; Sullivan.
We have looked at the company’s past performance in our earlier note. In this note, we talk about the updates and likely A/H premium.


Sany Heavy Industries A/H Listing - PHIP Updates and Thoughts on A/H Premium

Shanghai MediTrust Health Technology Group / Equity Capital Markets

Shanghai MediTrust Health Technology Group

<ul>
<li>The essence of MediTrust’s business model is building an ecosystem of "Internet/AI + drugs + medical services + insurance". The core competitiveness lies in the network effect of medical payments.</li>
<li>Smart Pharma Solution overly relies on pharmaceutical companies' promotion budgets and is susceptible to the impact of industry policies. Smart Insurance Solution is facing the industry dilemma of poor profitability.</li>
<li>Post-Money valuation after Series C+ financing is RMB11.68bn. Based on 2024 revenue of RMB2.035bn, P/S is 5.7x. We think valuation of MediTrust should be lower than <a href="https://www.smartkarma.com/entities/ping-an-healthcare-and-technology-company-limited" target="_blank" data-smartkarma-citation="entities:27008:1" rel="noopener">Ping An Good Doctor</a>
</li>
</ul>


The essence of MediTrust’s business model is building an ecosystem of "Internet/AI + drugs + medical services + insurance". The core competitiveness lies in the network effect of medical payments.
Smart Pharma Solution overly relies on pharmaceutical companies' promotion budgets and is susceptible to the impact of industry policies. Smart Insurance Solution is facing the industry dilemma of poor profitability.
Post-Money valuation after Series C+ financing is RMB11.68bn. Based on 2024 revenue of RMB2.035bn, P/S is 5.7x. We think valuation of MediTrust should be lower than Ping An Good Doctor



Pre-IPO Shanghai MediTrust Health Technology Group - The Business Model and the Concerns Behind

HK/China Equity Long-Short

Osbert Tang, CFA

Thematic (Sector/Industry)

<ul>
<li>Following Trump's threats on tariffs and pull-out of meeting with Xi, the 5% collapse in the HSI futures implies a heavy sell-off in HK when the market reopens.</li>
<li>The stocks with the best YTD performance and significant strengths in the last month are the prime candidates most vulnerable to the initial collapse. </li>
<li>
<a href="https://www.smartkarma.com/entities/semiconductor-manufacturing-international-corp-smic" target="_blank" data-smartkarma-citation="entities:14231:1" rel="noopener">Semiconductor Manufacturing International Corp (SMIC) (981 HK)</a>, <a href="https://www.smartkarma.com/entities/kuaishou-technology" target="_blank" data-smartkarma-citation="entities:29725:1" rel="noopener">Kuaishou Technology (1024 HK)</a>, <a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd-d7b798e2-202d-4e01-9a1e-799e2ae8f0c7" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba (9988 HK)</a>, and <a href="https://www.smartkarma.com/entities/hua-hong-semiconductor-ltd" target="_blank" data-smartkarma-citation="entities:7201:1" rel="noopener">Hua Hong Semiconductor (1347 HK)</a> are badly exposed.</li>
</ul>


Following Trump's threats on tariffs and pull-out of meeting with Xi, the 5% collapse in the HSI futures implies a heavy sell-off in HK when the market reopens.
The stocks with the best YTD performance and significant strengths in the last month are the prime candidates most vulnerable to the initial collapse. 

Semiconductor Manufacturing International Corp (SMIC) (981 HK), Kuaishou Technology (1024 HK), Alibaba (9988 HK), and Hua Hong Semiconductor (1347 HK) are badly exposed.


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 Sep 26th.</li>
<li>Top short increases and decreases were tabulated for one week and four week period.</li>
<li>We highlight short changes in CSPC Pharma, HSBC, Wuxi Apptec, China Mobile.</li>
</ul>


We analyzed the latest HK SFC report for aggregate short position as of Sep 26th.
Top short increases and decreases were tabulated for one week and four week period.
We highlight short changes in CSPC Pharma, HSBC, Wuxi Apptec, China Mobile.


HK Short Interest Weekly: CSPC Pharma, HSBC, Wuxi Apptec, China Mobile

China

Alibaba Health Information Technology Limited is an integrated healthcare information and content service provider. The Company uses product identification, authentication, and tracking system data for its healthcare information.

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Alibaba Health Information Tec (241 HK)

China Healthcare Weekly (Oct.19)-Bubble of HK Biotech Is Bursting, Ping An Good Doctor Is Overvalued

Innovative drug sector facing share price decline, companies at risk of halved valuations multiple times.The main goal of biotech is to turn...

Xinyao (Criss) Wang

Sany Heavy Industries A/H Listing - PHIP Updates and Thoughts on A/H Premium

Sany Heavy Industry (600031 CH), aims to raise around US$1.5bn in its H-share listing. In this note, we talk about its recent updates and likely A...

Sumeet Singh

Pre-IPO Shanghai MediTrust Health Technology Group - The Business Model and the Concerns Behind

MediTrust's business model focuses on building an ecosystem with core competitiveness in the network effect of medical payments.But the business...

Xinyao (Criss) Wang

HK Strategy: Who Will Suffer the Most?

Trump's tariff threats and market uncertainty lead to a potential heavy sell-off in HK, with top-performing stocks like SMIC, Kuaishou, Alibaba,...

Osbert Tang, CFA

HK Short Interest Weekly: CSPC Pharma, HSBC, Wuxi Apptec, China Mobile

We analyzed the latest HK SFC report for aggregate short position as of Sep 26th and highlight short interest changes in CSPC Pharma, HSBC, Wuxi...

Ke Yan, CFA, FRM

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

China Healthcare Weekly (Oct.19)-Bubble of HK Biotech Is Bursting, Ping An Good Doctor Is Overvalued

​Innovative drug sector facing share price decline, companies at risk of halved valuations multiple times.The main goal of biotech is to turn...

Xinyao (Criss) Wang

Sany Heavy Industries A/H Listing - PHIP Updates and Thoughts on A/H Premium

Sany Heavy Industry (600031 CH), aims to raise around US$1.5bn in its H-share listing. In this note, we talk about its recent updates and likely A...

Sumeet Singh

Pre-IPO Shanghai MediTrust Health Technology Group - The Business Model and the Concerns Behind

​MediTrust's business model focuses on building an ecosystem with core competitiveness in the network effect of medical payments.But the business...

Xinyao (Criss) Wang

HK Strategy: Who Will Suffer the Most?

​Trump's tariff threats and market uncertainty lead to a potential heavy sell-off in HK, with top-performing stocks like SMIC, Kuaishou, Alibaba,...

Osbert Tang, CFA

HK Short Interest Weekly: CSPC Pharma, HSBC, Wuxi Apptec, China Mobile

We analyzed the latest HK SFC report for aggregate short position as of Sep 26th and highlight short interest changes in CSPC Pharma, HSBC, Wuxi...

Ke Yan, CFA, FRM

Innovative drug sector facing share price decline, companies at risk of halved valuations multiple times.The main goal of biotech is to turn...

MediTrust's business model focuses on building an ecosystem with core competitiveness in the network effect of medical payments.But the business...

Trump's tariff threats and market uncertainty lead to a potential heavy sell-off in HK, with top-performing stocks like SMIC, Kuaishou, Alibaba,...