Asia Pac IPO & Placement Research, China biotech, Aequitas Research

Ke Yan, CFA, FRM

Asia Pac IPO & Placement Research, China biotech

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.

Quantitative Analysis

<ul>
<li>We analyse the changes of A-H premium on 146 stocks over the last week. The average A-H premium was 117.4% as of Sep 29th.</li>
<li>The average A-H premium changed by 1.5ppt week on week, led by health care, industrials, consumer discretionary and offset by consumer staples, utilities, real estate.</li>
<li>We highlight weekly changes in A-H premium for Beigene, China Vanke, Guangzhou Automobile Group, Wuapptec Co Ltd.</li>
</ul>


We analyse the changes of A-H premium on 146 stocks over the last week. The average A-H premium was 117.4% as of Sep 29th.
The average A-H premium changed by 1.5ppt week on week, led by health care, industrials, consumer discretionary and offset by consumer staples, utilities, real estate.
We highlight weekly changes in A-H premium for Beigene, China Vanke, Guangzhou Automobile Group, Wuapptec Co Ltd.


A-H Premium Weekly (Sep 29th): Beigene, China Vanke, Guangzhou Automobile, Wuapptec, Byd

<ul>
<li>We analyzed the latest HK SFC report for aggregate short position as of Sep 22nd.</li>
<li>Top short increases and decreases were tabulated for one week and four week period. </li>
<li>We highlight short changes in Tencent, Baba, CCB, China Mobile, AIA, Innovent Bio, Beigene.</li>
</ul>


We analyzed the latest HK SFC report for aggregate short position as of Sep 22nd.
Top short increases and decreases were tabulated for one week and four week period. 
We highlight short changes in Tencent, Baba, CCB, China Mobile, AIA, Innovent Bio, Beigene.


HK Short Interest Weekly: Tencent, Baba, CCB, China Mobile, AIA, Innovent Bio, Beigene

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Bottom-Up

<ul>
<li>RemeGen’s 23H1 results were unsatisfactory. We also have concerns about its future sales performance. The core reason behind is the disorganized pipeline layout, leading to inefficient sales system/high cost.</li>
<li>RemeGen's core technologies are mostly in-licensed from third parties. At first, RemeGen just hoped to develop drugs/build pipeline through these technologies, without considering the potential challenges of commercialization ahead.</li>
<li>The anti-corruption campaign could negatively affected RemeGen's 23H2 performance. The Company could fail to meet management's guidance for 2023. We lowered our valuation of RemeGen to RMB12 billion-18 billion.</li>
</ul>


RemeGen’s 23H1 results were unsatisfactory. We also have concerns about its future sales performance. The core reason behind is the disorganized pipeline layout, leading to inefficient sales system/high cost.
RemeGen's core technologies are mostly in-licensed from third parties. At first, RemeGen just hoped to develop drugs/build pipeline through these technologies, without considering the potential challenges of commercialization ahead.
The anti-corruption campaign could negatively affected RemeGen's 23H2 performance. The Company could fail to meet management's guidance for 2023. We lowered our valuation of RemeGen to RMB12 billion-18 billion.


Remegen (9995.HK/688331.CH) 23H1 - This Is Why RemeGen’s Commercialization Performance Is so Weak

<ul>
<li>Novartis' return of PD-1 to BeiGene may actually have nothing to do with TIGIT project. Long-term strategic adjustment and decreasing value of tislelizumab to Novartis could be the core reasons.</li>
<li>Abandoning PD-1 is a simple decision for Novartis, but not for BeiGene, who will do its best to promote FDA approval for tislelizumab, aiming to expand internationalization and stabilize valuation.</li>
<li>We advise investors not to focus too much on whether or not tislelizumab will eventually get FDA approval,because the actual peak sales tislelizumab can contribute to BeiGene could be disappointing.</li>
</ul>


Novartis' return of PD-1 to BeiGene may actually have nothing to do with TIGIT project. Long-term strategic adjustment and decreasing value of tislelizumab to Novartis could be the core reasons.
Abandoning PD-1 is a simple decision for Novartis, but not for BeiGene, who will do its best to promote FDA approval for tislelizumab, aiming to expand internationalization and stabilize valuation.
We advise investors not to focus too much on whether or not tislelizumab will eventually get FDA approval,because the actual peak sales tislelizumab can contribute to BeiGene could be disappointing.


BeiGene (6160.HK/BGNE.US) - The Truth Behind Novartis' Divorce Decision on PD-1

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

Brilliance China Automotive / Index Rebalance

<ul>
<li>It was a busy Friday with a bunch of indices rebalancing at the close and big volumes trading on a lot of stocks.</li>
<li>
<a href="https://www.smartkarma.com/entities/brilliance-china-automotive" target="_blank" data-smartkarma-citation="entities:469:1" rel="noopener">Brilliance China Automotive (1114 HK)</a> had a good week with the stock rallying on Thursday and Friday on huge volumes amid expectations of upcoming passive buying.</li>
<li>A quiet week for ETFs with mainland China ETFs seeing some outflows after the huge inflows over the last couple of months.</li>
</ul>


It was a busy Friday with a bunch of indices rebalancing at the close and big volumes trading on a lot of stocks.

Brilliance China Automotive (1114 HK) had a good week with the stock rallying on Thursday and Friday on huge volumes amid expectations of upcoming passive buying.
A quiet week for ETFs with mainland China ETFs seeing some outflows after the huge inflows over the last couple of months.


Index Rebalance & ETF Flow Recap: HSCEI, HSTECH, CSI500, STAR50, FnGuide Top10

China

BeiGene, Ltd. operates as a commercial stage biopharmaceutical company. The Company focuses on discovery, development, and commercialization of molecularly targeted and immuno-oncology drugs for the treatment of cancer. BeiGene serves patients worldwide.

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BeiGene (6160 HK)

A-H Premium Weekly (Sep 29th): Beigene, China Vanke, Guangzhou Automobile, Wuapptec, Byd

We analyzed A-H premium changes in the past week and highlight A-H premium changes for Beigene, China Vanke, Guangzhou Automobile, Wuapptec, Byd.

Ke Yan, CFA, FRM

HK Short Interest Weekly: Tencent, Baba, CCB, China Mobile, AIA, Innovent Bio, Beigene

We analyzed the latest HK SFC report for aggregate short position as of Sep 22nd and highlight short interest changes in Tencent, Baba, CCB, China...

Ke Yan, CFA, FRM

Remegen (9995.HK/688331.CH) 23H1 - This Is Why RemeGen’s Commercialization Performance Is so Weak

RemeGen's share price performed well recently. But we think it could be a good time for investors to consider offload - The Company is actually...

Xinyao (Criss) Wang

BeiGene (6160.HK/BGNE.US) - The Truth Behind Novartis' Divorce Decision on PD-1

Novartis returns PD-1 to BeiGene. The logic behind is not as simple as it seems. Although BeiGene will do its best to promote FDA approval of PD-1,...

Xinyao (Criss) Wang

Index Rebalance & ETF Flow Recap: HSCEI, HSTECH, CSI500, STAR50, FnGuide Top10

This recap highlights Insights covering Asian index rebalances (announcements/ forecasts/ IPO Fast Entry/ M&A driven changes). We also highlight...

Brian Freitas

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