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

<ul>
<li>All major Chinese e-commerce companies set up live broadcasting channels on Bilibili at the beginning of Singles’ Day sales.</li>
<li>Kuaishou chairman’s resignation will not change the business strategy, as he stepped down from CEO two years ago.</li>
<li>Baidu begins to sell ChatGPT-like service for CNY49.90 per month.</li>
</ul>


All major Chinese e-commerce companies set up live broadcasting channels on Bilibili at the beginning of Singles’ Day sales.
Kuaishou chairman’s resignation will not change the business strategy, as he stepped down from CEO two years ago.
Baidu begins to sell ChatGPT-like service for CNY49.90 per month.


China Consumption Weekly (6 Nov 2023): Kuaishou, Bilibili, Midea, Baidu, Yum China

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

<ul>
<li>Giant Biogene was listed in Hong Kong IPO in 2022. It has done well since and is now trading 45% above its IPO price, but its still cheap.</li>
<li>GB is a leader in the bioactive ingredient-based professional skin treatment product industry in China.</li>
<li>In this note, we will talk about the company’s past performance and future prospects.</li>
</ul>


Giant Biogene was listed in Hong Kong IPO in 2022. It has done well since and is now trading 45% above its IPO price, but its still cheap.
GB is a leader in the bioactive ingredient-based professional skin treatment product industry in China.
In this note, we will talk about the company’s past performance and future prospects.


2024 High Conviction - Giant Biogene - Growth Rate Keeps Moving Higher

Event-Driven

<ul>
<li>Multiple new agencies have been reporting that <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent (700 HK)</a> plans to trim its investment portfolio over the remainder of the year. </li>
<li>The reports have been coming in since the second half of the year and the company has been duly denying these rumors.</li>
<li>In this note, we look at Tencent’s shareholding in various companies to try and gauge which ones it could sell out of and how.</li>
</ul>


Multiple new agencies have been reporting that Tencent (700 HK) plans to trim its investment portfolio over the remainder of the year. 
The reports have been coming in since the second half of the year and the company has been duly denying these rumors.
In this note, we look at Tencent’s shareholding in various companies to try and gauge which ones it could sell out of and how.


Tencent Investee Selldown - The US$120bn Global Overhang

Forensic Analyst

Jason Yap, CFA

Forensic Accounting

Kuaishou Technology / Forensic Accounting

<a href="https://www.smartkarma.com/entities/beijing-kuaishou-technology-co-ltd" target="_blank" data-smartkarma-citation="entities:29725:1" rel="noopener">Kuaishou Technology (1024 HK)</a> is a video creation and streaming mobile application that has a huge userbase in Mainland China.  For the 3 months ended 31 March 2021, its Monthly Active Users (MAU), Daily Active Users (DAU) and Average Daily Time Spent per User totalled 520 million, 295 million and 99.3 minutes respectively, mainly derived from Mainland China. 
While its valuation has retreated to more reasonable levels in recent months, there are still considerable uncertainties about its revenue and profitability prospects, particularly in the wake of tightening regulations in Mainland China and execution difficulties in overseas expansion.
Further, Kuaishou's catchup story to Bytedance is not playing out as expected due to user growth underperformance and average user time spent peaking in Q1 2021.  We discuss some of the underlying issues in the following sections and highlight key factors to watch in its upcoming Q2 2021 results release (expected on 23 August 2021).

Kuaishou Technology (1024 HK) is a video creation and streaming mobile application that has a huge userbase in Mainland China.  For the 3 months ended 31 March 2021, its Monthly Active Users (MAU), Daily Active Users (DAU) and Average Daily Time Spent per User totalled 520 million, 295 million and 99.3 minutes respectively, mainly derived from Mainland China. 
While its valuation has retreated to more reasonable levels in recent months, there are still considerable uncertainties about its revenue and profitability prospects, particularly in the wake of tightening regulations in Mainland China and execution difficulties in overseas expansion.
Further, Kuaishou's catchup story to Bytedance is not playing out as expected due to user growth underperformance and average user time spent peaking in Q1 2021.  We discuss some of the underlying issues in the following sections and highlight key factors to watch in its upcoming Q2 2021 results release (expected on 23 August 2021). 

Kuaishou - Q2 2021 Preview Through a Forensic Lens

<ul>
<li>We believe Mr. Su’s resignation as chairman is not a concern, because Mr. Cheng, the CEO, has been operating the company for two years.</li>
<li>We believe the 3Q23 YoY growth will be lower, as 2Q23 had a lower comparison base.</li>
<li>We believe the operating margin can be negative in 3Q23 as Q3 is always a weak season, but operating profit will break even for 2023.</li>
</ul>


We believe Mr. Su’s resignation as chairman is not a concern, because Mr. Cheng, the CEO, has been operating the company for two years.
We believe the 3Q23 YoY growth will be lower, as 2Q23 had a lower comparison base.
We believe the operating margin can be negative in 3Q23 as Q3 is always a weak season, but operating profit will break even for 2023.


Kuaishou/KS (1024 HK) Earnings Preview: Unnecessary Concerns About Chairman Change and 3Q23 Results

China

Kuaishou Technology operates as a content community and social platform. The Company helps users create, upload and watch short videos on mobile devices. Kuaishou Technology offers services worldwide.

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Kuaishou Technology (1024 HK)

China Consumption Weekly (6 Nov 2023): Kuaishou, Bilibili, Midea, Baidu, Yum China

All major Chinese e-commerce companies set up live broadcasting channels on Bilibili for Singles’ Day sales. Kuaishou chairman resigned. Baidu...

Ming Lu

2024 High Conviction - Giant Biogene - Growth Rate Keeps Moving Higher

Giant Biogene was listed in Hong Kong IPO in 2022. It has done well since and is now trading 45% above its IPO price, but its still cheap.

Sumeet Singh

Tencent Investee Selldown - The US$120bn Global Overhang

There have been multiple reports that Tencent (700 HK) plans to trim its investment portfolio over the remainder of the year. We look at Tencent's...

Sumeet Singh

Kuaishou - Q2 2021 Preview Through a Forensic Lens

Kuaishou's revenue and profitability prospects remain uncertain, particularly in the wake of stricter regulations and overseas expansion hurdles....

Jason Yap, CFA

Kuaishou/KS (1024 HK) Earnings Preview: Unnecessary Concerns About Chairman Change and 3Q23 Results

Mr. Su’s resigned as chairman, but Mr. Cheng, the CEO, has been operating the company for two years. We believe the coming 3Q23 slowdown is due to...

Ming Lu

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