Investment Advisors, JL Warren Capital

Junheng Li

Investment Advisors

JL Warren Capital

JL Warren Capital LLC is a leading independent equity research firm focused on Chinese companies and listed multinationals in China. We employ a bottom-up research approach that takes great care to avoid the acquisition of material non-public information. Through investigative due diligence including channel surveys and interviews, our research helps clients to pinpoint the dislocations in the market.

Thematic (Sector/Industry)

Rounds of Tightening Squeezing Online Cash Loan PlatformsOn November 22 after the market close, the International Financial News by People's Daily, reported that new rounds of tightening are coming to the online microlenders in China.   According to the paper, new regulations have four major components:<ul><li>No new P2P licenses will be granted, sending a message to the industry that the regulators are investigating the irregularity and ramifications of online lending practices.</li></ul><ul><li>Banks and bank holding companies are not allowed to hold cash loan assets underwritten by online platforms, as those assets are deemed as too risky.</li></ul><ul><li>The industry is to consolidate after irregular players are eradicated. Post reform, the industry will be dominated by financial institutions that are regulated by the CBRC and the mega internet players such as JD, Baidu and Tencent etc. </li></ul><ul><li>Cash loan securitization is strictly forbidden, as securitization amplifies risks and disincentives investors to perform due diligence on assets that they buy.  </li></ul>

Rounds of Tightening Squeezing Online Cash Loan PlatformsOn November 22 after the market close, the International Financial News by People's Daily, reported that new rounds of tightening are coming to the online microlenders in China.   According to the paper, new regulations have four major components:No new P2P licenses will be granted, sending a message to the industry that the regulators are investigating the irregularity and ramifications of online lending practices.Banks and bank holding companies are not allowed to hold cash loan assets underwritten by online platforms, as those assets are deemed as too risky.The industry is to consolidate after irregular players are eradicated. Post reform, the industry will be dominated by financial institutions that are regulated by the CBRC and the mega internet players such as JD, Baidu and Tencent etc. Cash loan securitization is strictly forbidden, as securitization amplifies risks and disincentives investors to perform due diligence on assets that they buy.     

China's Debt Focus and Implication on Online Consumer Loan Industry

Public Relations and Social Media Manager, Dechert LLP

Peggy Heffner

Public Relations and Social Media Manager

Dechert is a global specialist law firm

Dechert LLP

Dechert is a global specialist law firm.
Focused on sectors with the greatest complexities, legal intricacies and highest regulatory demands, we excel in delivering practical commercial judgment and deep legal expertise for high-stakes matters.

Our work is widely recognized. We have 20 standout practices noted by Chambers Global, including global-wide rankings for arbitration, corporate investigations, anti-corruption, investment funds and life sciences. Named Antitrust Team of the Year, Chambers USA commends our “accomplished group” as “routinely sought after to handle some of the most significant litigation and transactions in the antitrust world.” 

In an increasingly challenging environment, clients look to us to serve them in ways that are faster, sharper and leaner without compromising excellence. We developed a first-of-its kind legal project management department, which uses technology, people and processes to drive efficiency and deliver value for our clients.

We are innovators. Dechert ranked #7 in the Financial Times’ Top North American Innovative Law Firms. Financial Times also recognizes us among the Top European Innovative Law Firms and highly commends World Compass, our marketing compliance service, which offers investment firms advice in more than 100 jurisdictions.

<div class="content-highlight">The private credit industry is on track to reach around $1 trillion in assets under management (AUM) by 2020, according to ACC and Preqin data. The historic compound annual growth rate of 20% of the industry has seen the sector increase in size 14-fold since 2000, reaching over $600 billion by the end of 2016.</div><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/035/038/original/Screen%20Shot%202017-10-05%20at%208.47.05%20AM.png?1507168161" class="editor-image img-responsive" data-smartkarma-image-id="35038"></figure>The 2017 research comes as the private credit industry reaches an important inflection point.Whilst previous editions of Financing the Economy focused on how the industry, already prominent in the US, established itself around the world as a credible alternative to traditional sources of finance, the past 12 months have seen it cement its place in the lending landscape globally.

The private credit industry is on track to reach around $1 trillion in assets under management (AUM) by 2020, according to ACC and Preqin data. The historic compound annual growth rate of 20% of the industry has seen the sector increase in size 14-fold since 2000, reaching over $600 billion by the end of 2016.The 2017 research comes as the private credit industry reaches an important inflection point.Whilst previous editions of Financing the Economy focused on how the industry, already prominent in the US, established itself around the world as a credible alternative to traditional sources of finance, the past 12 months have seen it cement its place in the lending landscape globally.

Financing the Economy 2017: The Role of Private Credit Managers in Supporting Economic Growth

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

Equity Capital Markets

<ul>
<li>Ant Group is considering on listing its overseas unit Ant International in Hong Kong. Ant International contributes approximately 20% to Ant Group's total revenue.</li>
<li>Ant International operates four core business lines: Alipay+ (cross-border payment platform), Antom (global merchant acquiring network), WorldFirst (remittance service), and Bettr (digital payment solution).</li>
<li>Given the growing political to delist Chinese stocks from the US exchanges, there could be a greater political pressure on the Chinese government to approve Chinese IPOs in Hong Kong.</li>
</ul>


Ant Group is considering on listing its overseas unit Ant International in Hong Kong. Ant International contributes approximately 20% to Ant Group's total revenue.
Ant International operates four core business lines: Alipay+ (cross-border payment platform), Antom (global merchant acquiring network), WorldFirst (remittance service), and Bettr (digital payment solution).
Given the growing political to delist Chinese stocks from the US exchanges, there could be a greater political pressure on the Chinese government to approve Chinese IPOs in Hong Kong.


Ant Group Considering on Listing Overseas Unit Ant International in Hong Kong

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

Event-Driven

<ul>
<li>
<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 Group Holding (9988 HK)</a> stock has rallied bigly over the last month and has gained 55% over that period.</li>
<li>That has led to <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</a>'s weight in the <a href="https://www.smartkarma.com/entities/hong-kong-hang-seng-index" target="_blank" data-smartkarma-citation="entities:22899:1" rel="noopener">HSI INDEX</a>, <a href="https://www.smartkarma.com/entities/hang-seng-china-enterprises-index" target="_blank" data-smartkarma-citation="entities:22900:1" rel="noopener">HSCEI INDEX</a>, <a href="https://www.smartkarma.com/entities/hang-seng-tech-index" target="_blank" data-smartkarma-citation="entities:31367:1" rel="noopener">HSTECH INDEX</a> and HSIII Index rising above the cap of 8%/12% and passives will sell on 7 March.</li>
<li>We estimate passive trackers will need to sell US$1.2bn of stock due to capping. Shorts have been increasing, and quarterly results will be announced on 20 February.</li>
</ul>



Alibaba Group Holding (9988 HK) stock has rallied bigly over the last month and has gained 55% over that period.
That has led to Alibaba's weight in the HSI INDEX, HSCEI INDEX, HSTECH INDEX and HSIII Index rising above the cap of 8%/12% and passives will sell on 7 March.
We estimate passive trackers will need to sell US$1.2bn of stock due to capping. Shorts have been increasing, and quarterly results will be announced on 20 February.


Alibaba (9988 HK): Results This Week; Over US$1bn Passive Selling in 3 Weeks

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.

<ul>
<li>Antfin will come out of its placement linked lockup for its remaining stake in Zomato soon.</li>
<li>Ant Group had earlier sold some of its stake in Nov 2023 and Mar 2024. It still has over US$800m worth of shares left to sell.</li>
<li>In this note, we talk about the deal dynamics and run the deal through our ECM framework.</li>
</ul>


Antfin will come out of its placement linked lockup for its remaining stake in Zomato soon.
Ant Group had earlier sold some of its stake in Nov 2023 and Mar 2024. It still has over US$800m worth of shares left to sell.
In this note, we talk about the deal dynamics and run the deal through our ECM framework.


Zomato Placement Lockup Expiry - US$800m Overhang

China

Ant Group Co., Ltd. develops online payment platforms. The Company produces credit system and financial services platforms which provide consumers and small businesses with safe and convenient inclusive financial services globally. Ant Group provides its services worldwide.

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Ant Group (6688 HK)

China's Debt Focus and Implication on Online Consumer Loan Industry

Rounds of Tightening Squeezing Online Cash Loan PlatformsOn November 22 after the market close, the International Financial News by People's Daily,...

JL Warren Capital

Financing the Economy 2017: The Role of Private Credit Managers in Supporting Economic Growth

The private credit industry is on track to reach around $1 trillion in assets under management (AUM) by 2020, according to ACC and Preqin data. The...

Dechert LLP

Ant Group Considering on Listing Overseas Unit Ant International in Hong Kong

Ant Group is considering on listing its overseas unit Ant International in Hong Kong. Ant International contributes approximately 20% to Ant...

Douglas Kim

Alibaba (9988 HK): Results This Week; Over US$1bn Passive Selling in 3 Weeks

The huge rally in Alibaba over the last month will lead to capping in the Hang Seng Indexes in March. We estimate passives need to sell US$1.2bn of...

Brian Freitas

Zomato Placement Lockup Expiry - US$800m Overhang

Antfin will come out of its placement linked lockup for its remaining stake in Zomato soon. In this note, we talk about the lockup dynamics.

Sumeet Singh

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