Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>Friday in US time, the China Securities Regulatory Commission (CSRC), China's MOF, and the US Public Company Accounting Oversight Board (PCAOB) "agreed" on a Statement of Protocol.</li>
<li>This SoP sets the outlines for PCAOB access to inspect/investigate audit papers and accounting firms in China and HK for companies listed in the US.</li>
<li>The releases' difference in language is to be expected - different constituencies - but as PCAOB Chair Williams said, <em>“Now we will find out whether those promises hold up."</em>
</li>
</ul>


Friday in US time, the China Securities Regulatory Commission (CSRC), China's MOF, and the US Public Company Accounting Oversight Board (PCAOB) "agreed" on a Statement of Protocol.
This SoP sets the outlines for PCAOB access to inspect/investigate audit papers and accounting firms in China and HK for companies listed in the US.
The releases' difference in language is to be expected - different constituencies - but as PCAOB Chair Williams said, “Now we will find out whether those promises hold up."



CSRC and PCAOB "Agree" On Audit Terms - Now PCAOB Will Try To Prove a Negative

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

Quantitative Analysis

<ul>
<li>Short notional in Hong Kong is HK$439bn and has been falling over the last 18 months due to a drop in the market.</li>
<li>In terms of short notional to issue market cap, the Information Technology, Materials, Health Care and Consumer Discretionary sectors are up there, with Communication Services, Real Estate the least shorted.</li>
<li>Over the year, the largest shorts in terms of notional have been built on Xiaomi Corp, Meituan, JD.com, AIA Group Ltd, Postal Savings Bank of China, Orient Overseas, Techtronic Industries.</li>
</ul>


Short notional in Hong Kong is HK$439bn and has been falling over the last 18 months due to a drop in the market.
In terms of short notional to issue market cap, the Information Technology, Materials, Health Care and Consumer Discretionary sectors are up there, with Communication Services, Real Estate the least shorted.
Over the year, the largest shorts in terms of notional have been built on Xiaomi Corp, Meituan, JD.com, AIA Group Ltd, Postal Savings Bank of China, Orient Overseas, Techtronic Industries.


Hong Kong: Where Have Shorts Been Building Up?

David Blennerhassett

<ul>
<li>Last week <strong><a href="https://www.smartkarma.com/entities/yum-china-holdings-inc-0533692c-6dae-4014-baa1-ed0b050638f2" target="_blank" data-smartkarma-citation="entities:29259:1" rel="noopener">Yum China Holdings Inc (9987 HK)</a></strong>  <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2022/0815/2022081501554.pdf" target="_blank" rel="noopener">announced</a> it has applied for voluntary conversion to a primary listing on the Hong Kong Stock Exchange.</li>
<li>Should all necessary approvals from the HKEx be satisfied, Yum will become dual primary listed on the New York Stock Exchange and the HKEx.</li>
<li>This regulatory process, facilitated by rules introduced by the HKEx over the past year, enables the de-listing of the ADRs and the smooth transition to a sole HK listing.</li>
</ul>


Last week Yum China Holdings Inc (9987 HK)  announced it has applied for voluntary conversion to a primary listing on the Hong Kong Stock Exchange.
Should all necessary approvals from the HKEx be satisfied, Yum will become dual primary listed on the New York Stock Exchange and the HKEx.
This regulatory process, facilitated by rules introduced by the HKEx over the past year, enables the de-listing of the ADRs and the smooth transition to a sole HK listing.


Yum China Pursues Primary Listing Conversion On The HKEx

<ul>
<li>
<a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent (700 HK)</a>'s reported sale of its <a href="https://www.smartkarma.com/entities/meituan-dianping" target="_blank" data-smartkarma-citation="entities:26970:1" rel="noopener">Meituan (3690 HK)</a> stake led to a selloff on Meituan and on other companies that Tencent has invested in.</li>
<li>There are 10 listed companies where <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent (700 HK)</a>'s holding is over US$1bn. Some stakes are more likely to be sold than others. </li>
<li>A complete stake sale will benefit some companies more than others since they are part of a wider array of indices and that will bring in passive flow.</li>
</ul>



Tencent (700 HK)'s reported sale of its Meituan (3690 HK) stake led to a selloff on Meituan and on other companies that Tencent has invested in.
There are 10 listed companies where Tencent (700 HK)'s holding is over US$1bn. Some stakes are more likely to be sold than others. 
A complete stake sale will benefit some companies more than others since they are part of a wider array of indices and that will bring in passive flow.


Tencent's Potential Sale of Meituan Stake - Read Across to Other Stocks & Index Implications

<ul>
<li>This morning - 26 July - <a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd" target="_blank" data-smartkarma-citation="entities:787:1" rel="noopener">Alibaba (ADR) (BABA US)</a> / <a href="https://www.smartkarma.com/entities/alibaba-group" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba Group (9988 HK)</a> issued an <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2022/0726/2022072600077.pdf" target="_blank" rel="noopener">announcement</a> it would pursue a primary listing on the HKEX.</li>
<li>When Alibaba listed in NY, it was on ADRs. When it listed in HK, it was the shares underlying the ADRs but it was a quickie secondary listing.</li>
<li>It will now seek a dual primary listing as others have. This will make BABA Southbound-eligible and will slightly improve BABA's HSI funding trade prospects in future. </li>
</ul>


This morning - 26 July - Alibaba (ADR) (BABA US) / Alibaba Group (9988 HK) issued an announcement it would pursue a primary listing on the HKEX.
When Alibaba listed in NY, it was on ADRs. When it listed in HK, it was the shares underlying the ADRs but it was a quickie secondary listing.
It will now seek a dual primary listing as others have. This will make BABA Southbound-eligible and will slightly improve BABA's HSI funding trade prospects in future. 


Alibaba to Pursue Dual Primary Listing in HK - Impact on Stock Connect, Indices, Etc

China

Bilibili Inc. provides online entertainment services. The Company offers a platform that covers a wide array of genres and media formats, including videos, live broadcasting, mobile games, animation, and comics. Bilibili serves customers in China.

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

Bilibili (9626 HK)

CSRC and PCAOB "Agree" On Audit Terms - Now PCAOB Will Try To Prove a Negative

The PCAOB and CSRC announced they had signed a Statement of Protocol which allows the PCAOB to move forward with testing whether there will be...

Travis Lundy

Hong Kong: Where Have Shorts Been Building Up?

Short notional in HK has decreased as a result of falling prices. Shorts have been increasing on a lot of stocks over the year. A rally could see...

Brian Freitas

Yum China Pursues Primary Listing Conversion On The HKEx

It is not evident there is an immediate trade. It's a solid bet the next company seeking to upgrade its secondary listing into a dual-primary...

David Blennerhassett

Tencent's Potential Sale of Meituan Stake - Read Across to Other Stocks & Index Implications

A Reuters report that Tencent intended to sell its stake in Meituan led to a selloff across Tencent's investee companies. The impact of passive...

Brian Freitas

Alibaba to Pursue Dual Primary Listing in HK - Impact on Stock Connect, Indices, Etc

Alibaba this morning announced it will seek a Dual Primary Listing on the HKEX. This makes PCAOB-induced US exit easier, and will make the stock...

Travis Lundy

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)