HK/China Equity Long-Short

Osbert Tang, CFA

Equity Bottom-Up

China National Building Material / Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/china-national-building-ma-h" target="_blank" data-smartkarma-citation="entities:184:1" rel="noopener">China National Building Material (3323 HK)</a>'s proposed H-share buyback has been approved. We continue to support existing shareholders to tender their holdings to accept the offer. </li>
<li>The buyback will enhance FY25 and FY26 EPS by 4.8% and 8.2%, respectively. Its book value will increase by 11% compared to without a buyback.</li>
<li>The post-buyback FY25 PER of 9.6x is at a premium to the sector median of 7.6x. The proposal has led to significant outperformance, and we anticipate downside risks on completion. </li>
</ul>



China National Building Material (3323 HK)'s proposed H-share buyback has been approved. We continue to support existing shareholders to tender their holdings to accept the offer. 
The buyback will enhance FY25 and FY26 EPS by 4.8% and 8.2%, respectively. Its book value will increase by 11% compared to without a buyback.
The post-buyback FY25 PER of 9.6x is at a premium to the sector median of 7.6x. The proposal has led to significant outperformance, and we anticipate downside risks on completion. 


China National Building Material (3323 HK): Buyback Approved and Implications

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

China National Building Material / Event-Driven

<ul>
<li>On the 6th December 2024, <strong><a href="https://www.smartkarma.com/entities/china-national-building-ma-h" target="_blank" data-smartkarma-citation="entities:184:1" rel="noopener">China National Building Material (3323 HK)</a></strong> (CNBM), China's leading building materials company, offered to buy back 841,749,304 H-shares at HK$4.03/share, a 15.1% premium to undisturbed.</li>
<li>This elevated CNBM's parent's stake to 50.01% of total shares from 45.02% currently, necessitating  a whitewash waiver so the parent would not be obliged to make a full blown offer.  </li>
<li>Independent H-shareholder overwhelmingly approved the waiver yesterday, the 19th February. Tendering closes on the 5th March. Minimum pro-ration is 19.24%. I'm estimating at least 35%. The Offer is now unconditional.</li>
</ul>


On the 6th December 2024, China National Building Material (3323 HK) (CNBM), China's leading building materials company, offered to buy back 841,749,304 H-shares at HK$4.03/share, a 15.1% premium to undisturbed.
This elevated CNBM's parent's stake to 50.01% of total shares from 45.02% currently, necessitating  a whitewash waiver so the parent would not be obliged to make a full blown offer.  
Independent H-shareholder overwhelmingly approved the waiver yesterday, the 19th February. Tendering closes on the 5th March. Minimum pro-ration is 19.24%. I'm estimating at least 35%. The Offer is now unconditional.


CNBM (3323 HK): Whitewash Waiver Secured. Next Is The Proration

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

<ul>
<li>The IFA opines that the <a href="https://www.smartkarma.com/entities/china-national-building-ma-h" target="_blank" data-smartkarma-citation="entities:184:1" rel="noopener">China National Building Material (3323 HK)</a> share buyback, which will acquire a maximum of 841.7 million H Shares at HK$4.03, is fair and reasonable.</li>
<li>The share buyback seems designed to enable the CNBM parent company to bypass the creeper rule and squeeze the shorts. </li>
<li>The fortuitous material derating of peers has helped make the buyback attractive. Therefore, the votes should pass, and the minimum acceptance condition should be met. </li>
</ul>


The IFA opines that the China National Building Material (3323 HK) share buyback, which will acquire a maximum of 841.7 million H Shares at HK$4.03, is fair and reasonable.
The share buyback seems designed to enable the CNBM parent company to bypass the creeper rule and squeeze the shorts. 
The fortuitous material derating of peers has helped make the buyback attractive. Therefore, the votes should pass, and the minimum acceptance condition should be met. 


China National Building Material (3323 HK): H Share Buyback Vote on 19 February

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 analyze statistics on top repurchases over one week, one month, one quarter and one year periods ended on Dec 12th based on HKEx daily reports.</li>
<li>In the past 7 days, the top 3 companies that repurchased the most shares from the market were Tencent (700 HK), Xiaomi (1810 HK), Cosco Shipping (1919 HK).</li>
<li>In the past 30 days, the top 3 companies that repurchased the most shares from the market were Tencent (700 HK), Xiaomi (1810 HK), Cosco Shipping (1919 HK).</li>
</ul>


We analyze statistics on top repurchases over one week, one month, one quarter and one year periods ended on Dec 12th based on HKEx daily reports.
In the past 7 days, the top 3 companies that repurchased the most shares from the market were Tencent (700 HK), Xiaomi (1810 HK), Cosco Shipping (1919 HK).
In the past 30 days, the top 3 companies that repurchased the most shares from the market were Tencent (700 HK), Xiaomi (1810 HK), Cosco Shipping (1919 HK).


Hong Kong Buybacks Weekly (Dec 12th): Tencent, Xiaomi, Cosco Shipping

<ul>
<li>Back on the 6th December, <strong><a href="https://www.smartkarma.com/entities/china-national-building-ma-h" target="_blank" data-smartkarma-citation="entities:184:1" rel="noopener">China National Building Material (3323 HK)</a></strong> (CNBM), China's leading building materials company, offered to buy back 841,749,304 H-shares at HK$4.03/share, a 15.1% premium to undisturbed.</li>
<li>As this elevates CNBM's parent's stake to 50.01% of total shares from 45.02% currently, independent H-shareholder will vote on a whitewash waiver on the 19th February. </li>
<li>Minimum pro-ration is 19.24%. It is likely to be higher. The question is whether to buy, and/or borrow, and tender; or simply short outright.</li>
</ul>


Back on the 6th December, China National Building Material (3323 HK) (CNBM), China's leading building materials company, offered to buy back 841,749,304 H-shares at HK$4.03/share, a 15.1% premium to undisturbed.
As this elevates CNBM's parent's stake to 50.01% of total shares from 45.02% currently, independent H-shareholder will vote on a whitewash waiver on the 19th February. 
Minimum pro-ration is 19.24%. It is likely to be higher. The question is whether to buy, and/or borrow, and tender; or simply short outright.


CNBM (3323 HK): A Closer Look At Proration

China

China National Building Material Company Limited manufactures cement products. The Company produces silica cements, commodity concretes, cement clinkers, and other products. China National Building Material also produces glass fibers, composite materials, and other products.

China National Building Material (3323 HK)

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China National Building Material (3323 HK)