HK/China Equity Long-Short

Osbert Tang, CFA

Equity Capital Markets

<ul>
<li>With an aim to raise HK$8.2bn of net proceeds, <a href="https://www.smartkarma.com/entities/lingyi-itech-guangdong-company" target="_blank" data-smartkarma-citation="entities:50139:1" rel="noopener">Lingyi iTech (1688 HK)</a>'s H-share IPO is a sizeable one and should attract interest. </li>
<li>Earnings record for this high-precision intelligent manufacturing platform is volatile, but should improve in FY27-28. 1Q26 profit drop is distorted by huge exchange losses.  </li>
<li>Priced at 44.6% discount to its A-share and 27.7x PER, the IPO is inexpensive. Assuming a discount of 26.9%, the fair price (HK$13.43) implies a 32% upside.</li>
</ul>


With an aim to raise HK$8.2bn of net proceeds, Lingyi iTech (1688 HK)'s H-share IPO is a sizeable one and should attract interest. 
Earnings record for this high-precision intelligent manufacturing platform is volatile, but should improve in FY27-28. 1Q26 profit drop is distorted by huge exchange losses.  
Priced at 44.6% discount to its A-share and 27.7x PER, the IPO is inexpensive. Assuming a discount of 26.9%, the fair price (HK$13.43) implies a 32% upside.


Lingyi ITech (1688 HK) IPO: Deserves a Narrower Discount

Asia Pac ECM and Index Rebal, Shenton Research

Ke Yan, CFA, FRM

Asia Pac ECM and Index Rebal

Asia Pac IPO & Placement Research, China Biotech

DZT Research

DZT Research is an independent Asia Pacific equity specialist. Our quantitative research covers index rebalancing flows, alongside exchange data analytics accross Asia Pacific. On the equity capital markets side, we focus on Asia Pacific ECM, especially biotech and TMT. Our lead analyst is frequently cited by international media.

Quantitative Analysis

<ul>
<li>We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of June 12th.</li>
<li>The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.</li>
<li>We highlight flows for Tencent, Kingboard, Knowledge Atlas, Alibaba, Smic, Yangtze Optical Fibre And-H, Kingboard Laminates, China Hongqiao, Ke, Kingdee.</li>
</ul>


We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of June 12th.
The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.
We highlight flows for Tencent, Kingboard, Knowledge Atlas, Alibaba, Smic, Yangtze Optical Fibre And-H, Kingboard Laminates, China Hongqiao, Ke, Kingdee.


HK Connect Flows Weekly (Jun 12th): Tencent, Kingboard, Knowledge Atlas, Alibaba, Smic, Ke, Kingdee

Dajin Heavy Industry / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/dajin-heavy-industry" target="_blank" data-smartkarma-citation="entities:50156:1" rel="noopener">Dajin Heavy Industry (1081 HK)</a>'s IPO at HK$66.40 to raise HK$5.6bn is sizable. Its leadership position in providing core offshore wind power equipment globally is a strength.</li>
<li>The market consensus suggests solid growth prospects, with a 3-year earnings CAGR of 44.8%. Its 1Q26 result has showcased its momentum - net profit surged 88.2%.</li>
<li>The IPO price equals a 21.8% discount to A-share <a href="https://www.smartkarma.com/entities/dajin-heavy-industry-corp-a" target="_blank" data-smartkarma-citation="entities:13598:1" rel="noopener">Dajin Heavy A (002487 CH)</a>, which is not attractive enough. Various valuation scenarios point to single-digit upside only.   </li>
</ul>



Dajin Heavy Industry (1081 HK)'s IPO at HK$66.40 to raise HK$5.6bn is sizable. Its leadership position in providing core offshore wind power equipment globally is a strength.
The market consensus suggests solid growth prospects, with a 3-year earnings CAGR of 44.8%. Its 1Q26 result has showcased its momentum - net profit surged 88.2%.
The IPO price equals a 21.8% discount to A-share Dajin Heavy A (002487 CH), which is not attractive enough. Various valuation scenarios point to single-digit upside only.   


Dajin Heavy Industry (1081 HK) IPO: Not Going to Miss Much

<ul>
<li>We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of May 22nd.</li>
<li>The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.</li>
<li>We highlight flows for Alibaba, China Life, China Mobile, PICC P&amp;C, SMIC, Tencent, Geely Automobile, Xiaomi, Meituan, AIA.</li>
</ul>


We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of May 22nd.
The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.
We highlight flows for Alibaba, China Life, China Mobile, PICC P&amp;C, SMIC, Tencent, Geely Automobile, Xiaomi, Meituan, AIA.


HK Connect Flows Weekly (May 22nd): Alibaba, China Life, China Mobile, PICC P&C, SMIC, Tencent

<ul>
<li>We analyse the changes of A-H premium on 180 stocks over the last week. The average A-H premium was 70.1% as of May 8th.</li>
<li>The average A-H premium changed by 0.2ppt week-on-week, led by utilities, energy, communication services and offset by financials.</li>
<li>We highlight weekly changes in A-H premium for Datang Power, Eastroc, Montage Tech, China Life, Midea, Fuyao Glass.</li>
</ul>


We analyse the changes of A-H premium on 180 stocks over the last week. The average A-H premium was 70.1% as of May 8th.
The average A-H premium changed by 0.2ppt week-on-week, led by utilities, energy, communication services and offset by financials.
We highlight weekly changes in A-H premium for Datang Power, Eastroc, Montage Tech, China Life, Midea, Fuyao Glass.


A-H Premium Weekly (May 8th): Datang Power, Eastroc, Montage Tech, China Life, Midea, Fuyao Glass

China

Chifeng Jilong Gold Mining Co., Ltd. is primarily engaged in the exploration, mining, beneficiation, and sale of gold and other non-ferrous metals such as zinc, lead, copper, and molybdenum. The company also operates in polymetallic mining and comprehensive resource recycling, including waste electrical and electronic product dismantling. It is headquartered in Beijing, China, and was founded in 1998.

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Chifeng Jilong Gold Mining (6693 HK)

Lingyi ITech (1688 HK) IPO: Deserves a Narrower Discount

Lingyi iTech's H-share IPO aims to raise HK$8.2bn, with potential for faster earnings growth in FY27 and FY28. It deserves a narrower discount to...

Osbert Tang, CFA

HK Connect Flows Weekly (Jun 12th): Tencent, Kingboard, Knowledge Atlas, Alibaba, Smic, Ke, Kingdee

We analyzed southbound Hong Kong connect flows in the past week and highlighted flows for Tencent (700 HK), Kingboard (148 HK), Knowledge Atlas...

Ke Yan, CFA, FRM

Dajin Heavy Industry (1081 HK) IPO: Not Going to Miss Much

Dajin Heavy's IPO will raise HK$5.6bn at HK$66.40, thanks to its leadership in offshore wind power equipment. Market sees 44.8% 3-year earnings...

Osbert Tang, CFA

HK Connect Flows Weekly (May 22nd): Alibaba, China Life, China Mobile, PICC P&C, SMIC, Tencent

We analyzed southbound Hong Kong connect flows in the past week and highlighted flows for Alibaba, China Life, China Mobile, PICC P&C, SMIC,...

Ke Yan, CFA, FRM

A-H Premium Weekly (May 8th): Datang Power, Eastroc, Montage Tech, China Life, Midea, Fuyao Glass

We analyzed A-H premium changes in the past week and highlight A-H premium changes for Datang Power, Eastroc, Montage Tech, China Life, Midea,...

Ke Yan, CFA, FRM

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Lingyi ITech (1688 HK) IPO: Deserves a Narrower Discount

​Lingyi iTech's H-share IPO aims to raise HK$8.2bn, with potential for faster earnings growth in FY27 and FY28. It deserves a narrower discount to...

Osbert Tang, CFA

HK Connect Flows Weekly (Jun 12th): Tencent, Kingboard, Knowledge Atlas, Alibaba, Smic, Ke, Kingdee

We analyzed southbound Hong Kong connect flows in the past week and highlighted flows for Tencent (700 HK), Kingboard (148 HK), Knowledge Atlas...

Ke Yan, CFA, FRM

Dajin Heavy Industry (1081 HK) IPO: Not Going to Miss Much

​Dajin Heavy's IPO will raise HK$5.6bn at HK$66.40, thanks to its leadership in offshore wind power equipment. Market sees 44.8% 3-year earnings...

Osbert Tang, CFA

HK Connect Flows Weekly (May 22nd): Alibaba, China Life, China Mobile, PICC P&C, SMIC, Tencent

We analyzed southbound Hong Kong connect flows in the past week and highlighted flows for Alibaba, China Life, China Mobile, PICC P&C, SMIC,...

Ke Yan, CFA, FRM

A-H Premium Weekly (May 8th): Datang Power, Eastroc, Montage Tech, China Life, Midea, Fuyao Glass

We analyzed A-H premium changes in the past week and highlight A-H premium changes for Datang Power, Eastroc, Montage Tech, China Life, Midea,...

Ke Yan, CFA, FRM

Lingyi iTech's H-share IPO aims to raise HK$8.2bn, with potential for faster earnings growth in FY27 and FY28. It deserves a narrower discount to...

Dajin Heavy's IPO will raise HK$5.6bn at HK$66.40, thanks to its leadership in offshore wind power equipment. Market sees 44.8% 3-year earnings...