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 138 stocks over the last week.</li>
<li>Consumer staple, consumer discretionary and heathcare led the 3.0ppt weekly A-H premium decline. </li>
<li>We highlight names including Shenzhen HepaLink, Shandong Xinhua Pharm, and Shanghai Haohai Biological Technology.</li>
</ul>


We analyse the changes of A/H premium on 138 stocks over the last week.
Consumer staple, consumer discretionary and heathcare led the 3.0ppt weekly A-H premium decline. 
We highlight names including Shenzhen HepaLink, Shandong Xinhua Pharm, and Shanghai Haohai Biological Technology.


A-H Premium Weekly: Healthcare Led Premium Decline

HK/China Equity Long-Short

Osbert Tang, CFA

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/china-longyuan-power-group-corp-ltd" target="_blank" data-smartkarma-citation="entities:14215:1" rel="noopener">China Longyuan Power Group Corp (916 HK)</a> is expected to see an exciting year on the back of faster capacity growth, increase in utilisation hours and higher average tariff.</li>
<li>Potential asset injection from its parent CHN Energy remains a wild card. It may grow its capacity by an average of 30% over the next three years if materialises.</li>
<li>Lower funding costs and the return to A-share are positive to Longyuan's expansion. We think consensus forecasts for next 2 years are too low and represent potential upside surprises.</li>
</ul>



China Longyuan Power Group Corp (916 HK) is expected to see an exciting year on the back of faster capacity growth, increase in utilisation hours and higher average tariff.
Potential asset injection from its parent CHN Energy remains a wild card. It may grow its capacity by an average of 30% over the next three years if materialises.
Lower funding costs and the return to A-share are positive to Longyuan's expansion. We think consensus forecasts for next 2 years are too low and represent potential upside surprises.


China Longyuan (916 HK): It Deserves the Premium

Xinjiang Goldwind Science & Technology / Equity Bottom-Up

<ul>
<li>FY21 result of <a href="https://www.smartkarma.com/entities/xinjiang-goldwind-science-technology-h" target="_blank" data-smartkarma-citation="entities:10112:1" rel="noopener">Xinjiang Goldwind (2208 HK)</a> is healthy, though behind expectations due to impairments. We see them not recurrent into FY22, and this should be positive to earnings.  </li>
<li>Management sees some margin decline for WTG segment but the expectation of over 30% volume growth should offset the impact. Orderbook is secured at 16,874.4MW.</li>
<li>Growth in power servicing is the bright sport with target revenue growth for 50%. Goldwind also plans to also add 0.5-1GW of generating capacity annually at wind farm development segment.</li>
</ul>


FY21 result of Xinjiang Goldwind (2208 HK) is healthy, though behind expectations due to impairments. We see them not recurrent into FY22, and this should be positive to earnings.  
Management sees some margin decline for WTG segment but the expectation of over 30% volume growth should offset the impact. Orderbook is secured at 16,874.4MW.
Growth in power servicing is the bright sport with target revenue growth for 50%. Goldwind also plans to also add 0.5-1GW of generating capacity annually at wind farm development segment.


Xinjiang Goldwind (2208 HK): Positive Messages from Post-FY21 Call

China Power International / Equity Bottom-Up

<ul>
<li>2H21 is bad for <a href="https://www.smartkarma.com/entities/china-power-international" target="_blank" data-smartkarma-citation="entities:15548:1" rel="noopener">China Power International (2380 HK)</a> as coal price surged. But the positive news is that its wind and solar segments logged a 50.6% full-year profit growth.</li>
<li>There is good progress on transformation and it has 7GW of clean energy capacity to come on stream in FY22. This is equivalent to 46% of the existing capacity.</li>
<li>CPI said coal-fired plants are marginally profitable in Jan-Feb; meanwhile, hydropower will do better in this year. Overall, these set the stage for a turnaround.</li>
</ul>


2H21 is bad for China Power International (2380 HK) as coal price surged. But the positive news is that its wind and solar segments logged a 50.6% full-year profit growth.
There is good progress on transformation and it has 7GW of clean energy capacity to come on stream in FY22. This is equivalent to 46% of the existing capacity.
CPI said coal-fired plants are marginally profitable in Jan-Feb; meanwhile, hydropower will do better in this year. Overall, these set the stage for a turnaround.


China Power International (2380 HK): Transformation to Soon Bear Fruits

China Three Gorges Renewables / Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/china-three-gorges-renewables" target="_blank" data-smartkarma-citation="entities:28950:1" rel="noopener">China Three Gorges Renewables (600905 CH)</a> (CTGR) has an splendid FY21 as it pre-announced result with a range of 46.5-53.1% growth in recurring profit, fuelled by generation and disposal gains. </li>
<li>The first full-year contribution of many projects commissioned in 4Q21, which boosted a 28.4% QoQ surge in power generation, should underpin FY22 earnings - consensus forecast is expecting 41% growth.</li>
<li>YTD, CTGR's share price performed in line with Shanghai Composite Index (-6.1%), but its strong EPS CAGR of 22% for FY21-23 provides room for it to outperformed in medium term. </li>
</ul>



China Three Gorges Renewables (600905 CH) (CTGR) has an splendid FY21 as it pre-announced result with a range of 46.5-53.1% growth in recurring profit, fuelled by generation and disposal gains. 
The first full-year contribution of many projects commissioned in 4Q21, which boosted a 28.4% QoQ surge in power generation, should underpin FY22 earnings - consensus forecast is expecting 41% growth.
YTD, CTGR's share price performed in line with Shanghai Composite Index (-6.1%), but its strong EPS CAGR of 22% for FY21-23 provides room for it to outperformed in medium term. 


China Three Gorges Renewables (600905 CH): Good, and Better Is Coming

China

China Suntien Green Energy Corp Ltd operates a wind farm and a natural gas business. The Company intends to build wind power projects and develop natural gas projects throughout China.

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China Suntien Green Energy (956 HK)

A-H Premium Weekly: Healthcare Led Premium Decline

A-H premium declined by 3.0ppt last week, led by consumer staple, consumer discretionary and heathcare. We highlight names including Shenzhen...

Ke Yan, CFA, FRM

China Longyuan (916 HK): It Deserves the Premium

FY22 will be an exciting year - higher utilisation, improvement in tariff, faster capacity growth and potential asset injection. All these factors...

Osbert Tang, CFA

Xinjiang Goldwind (2208 HK): Positive Messages from Post-FY21 Call

WTG is set for a 30% growth in capacity delivery in FY22, offsetting the impact of lower margin. Both power servicing and wind farm development...

Osbert Tang, CFA

China Power International (2380 HK): Transformation to Soon Bear Fruits

CPI is making good progress in transformation into a clean energy play. Profitability will improve in FY22, providing room for valuations to catch...

Osbert Tang, CFA

China Three Gorges Renewables (600905 CH): Good, and Better Is Coming

CTGR's pre-announced FY21 result beats market expectations, and FY22 beyond will be fuelled by more new capacity completion, particularly from...

Osbert Tang, CFA

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