Asia L/S Equity PM/Macro/Thematic Idea Generation

Rikki Malik

Cross Asset Strategy

<ul>
<li>Few surprises from the Government Work Report, but investor fatigue has set in.</li>
<li>Groundwork continues to be laid for a boost in consumption as a share of GDP</li>
<li>HK/China bull market to broaden out from the technology sector?</li>
</ul>


Few surprises from the Government Work Report, but investor fatigue has set in.
Groundwork continues to be laid for a boost in consumption as a share of GDP
HK/China bull market to broaden out from the technology sector?


NPC- Consumption Put Top of the Agenda, but Another Case of The “Boy Who Cried Wolf?”

Thematic (Sector/Industry)

<ul>
<li>Continuing review of the sectors we like for the next phase of the HK/China bull market</li>
<li>Expectations are so low that there is  a high probability of upside surprises</li>
<li>An unloved sector that will rerate on any positive catalyst</li>
</ul>


Continuing review of the sectors we like for the next phase of the HK/China bull market
Expectations are so low that there is  a high probability of upside surprises
An unloved sector that will rerate on any positive catalyst


Consumer Stocks - Waiting to Catch a Fire

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

Index Rebalance

<ul>
<li>With the review cutoff done, there could be two changes for the <a href="https://www.smartkarma.com/entities/ishares-china-large-cap-etf" target="_blank" data-smartkarma-citation="entities:766:1" rel="noopener">iShares China Large-Cap (FXI) (FXI US)</a> in March.</li>
<li>
<a href="https://www.smartkarma.com/entities/guotai-junan-securities-co-ltd-5dfaf2c5-76d3-4f34-a77d-118787fd7091" target="_blank" data-smartkarma-citation="entities:23752:1" rel="noopener">Guotai Junan Securities (2611 HK)</a> and <a href="https://www.smartkarma.com/entities/zte-corp-h" target="_blank" data-smartkarma-citation="entities:6922:1" rel="noopener">ZTE Corp H (763 HK)</a> are expected to replace <a href="https://www.smartkarma.com/entities/china-tourism-group-duty-free" target="_blank" data-smartkarma-citation="entities:36229:1" rel="noopener">China Tourism Group Duty Free (1880 HK)</a> and <a href="https://www.smartkarma.com/entities/china-coal-energy-co-h" target="_blank" data-smartkarma-citation="entities:383:1" rel="noopener">China Coal Energy Co H (1898 HK)</a>. </li>
<li>
<a href="https://www.smartkarma.com/entities/zte-corp-h" target="_blank" data-smartkarma-citation="entities:6922:1" rel="noopener">ZTE Corp H (763 HK)</a> has broken out to new highs (possibly on short covering) while <a href="https://www.smartkarma.com/entities/china-coal-energy-co-h" target="_blank" data-smartkarma-citation="entities:383:1" rel="noopener">China Coal Energy Co H (1898 HK)</a> continues to sell off.</li>
</ul>


With the review cutoff done, there could be two changes for the iShares China Large-Cap (FXI) (FXI US) in March.

Guotai Junan Securities (2611 HK) and ZTE Corp H (763 HK) are expected to replace China Tourism Group Duty Free (1880 HK) and China Coal Energy Co H (1898 HK). 

ZTE Corp H (763 HK) has broken out to new highs (possibly on short covering) while China Coal Energy Co H (1898 HK) continues to sell off.


FXI Rebalance Preview: Two Sets of Changes as ZTE Breaks Out, China Coal Dumps

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

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 Capital Markets

Contemporary Amperex Technology (CATL) / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/contemporary-amperex-technolog" target="_blank" data-smartkarma-citation="entities:24404:1" rel="noopener">Contemporary Amperex Technology (CATL)</a>, one of the world’s largest battery solutions providers, aims to raise at least US$5bn in its H-share listing.</li>
<li>CATL is the global leader in new energy vehicle battery solutions, in China and globally, as per SNE Research. Its A-shares have been listed since 2018.</li>
<li>We have looked at the company’s past performance in our earlier notes. In this note, we talk about updates from its most recent filings.</li>
</ul>



Contemporary Amperex Technology (CATL), one of the world’s largest battery solutions providers, aims to raise at least US$5bn in its H-share listing.
CATL is the global leader in new energy vehicle battery solutions, in China and globally, as per SNE Research. Its A-shares have been listed since 2018.
We have looked at the company’s past performance in our earlier notes. In this note, we talk about updates from its most recent filings.


Event-Driven

<ul>
<li>Nearing the end of the review period, we expect two changes for the <a href="https://www.smartkarma.com/entities/ishares-china-large-cap-etf" target="_blank" data-smartkarma-citation="entities:766:1" rel="noopener">iShares China Large-Cap (FXI) (FXI US)</a> ETF in March.</li>
<li>
<a href="https://www.smartkarma.com/entities/guotai-junan-securities-co-ltd-5dfaf2c5-76d3-4f34-a77d-118787fd7091" target="_blank" data-smartkarma-citation="entities:23752:1" rel="noopener">Guotai Junan Securities (2611 HK)</a> is a high probability add while <a href="https://www.smartkarma.com/entities/china-tourism-group-duty-free" target="_blank" data-smartkarma-citation="entities:36229:1" rel="noopener">China Tourism Group Duty Free (1880 HK)</a> is a high probability delete.</li>
<li>
<a href="https://www.smartkarma.com/entities/zte-corp-h" target="_blank" data-smartkarma-citation="entities:6922:1" rel="noopener">ZTE Corp H (763 HK)</a> is a potential inclusion currently and could replace <a href="https://www.smartkarma.com/entities/china-coal-energy-co-h" target="_blank" data-smartkarma-citation="entities:383:1" rel="noopener">China Coal Energy Co H (1898 HK)</a> as long as it stays in inclusion zone.</li>
</ul>


Nearing the end of the review period, we expect two changes for the iShares China Large-Cap (FXI) (FXI US) ETF in March.

Guotai Junan Securities (2611 HK) is a high probability add while China Tourism Group Duty Free (1880 HK) is a high probability delete.

ZTE Corp H (763 HK) is a potential inclusion currently and could replace China Coal Energy Co H (1898 HK) as long as it stays in inclusion zone.


FXI Rebalance Preview: GTJA, ZTE In; CTG, China Coal Out

China

China Tourism Group Duty Free Corporation Limited engages in sales of duty free goods and tax goods. The Company sells tobacco, wine and spirits, perfume, cosmetics, fashion and accessories, watches, jewelry, food, luggage products,and other products. China Tourism Group Duty Free also engages in investment and development of tourism destination commercial complexes.

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China Tourism Group Duty Free (1880 HK)

NPC- Consumption Put Top of the Agenda, but Another Case of The “Boy Who Cried Wolf?”

Investors feeling fatigued despite expected plans for boosting consumption in China, potential broadening of bull market beyond technology sector...

Rikki Malik

Consumer Stocks - Waiting to Catch a Fire

Budweiser Asia Pacific (1876.HK) is up 12% today as earnings are slightly less worse than expected and the dividend is increased. This confirms our...

Rikki Malik

FXI Rebalance Preview: Two Sets of Changes as ZTE Breaks Out, China Coal Dumps

GTJA and ZTE could replace CTG Duty Free and China Coal in the FXI ETF in March. Alibaba and Tencent will be sold on capping, Meituan bought. ZTE...

Brian Freitas

CATL A/H Listing - IPO Filing Updates

Contemporary Amperex Technology (CATL), one of the world’s largest battery solutions providers, aims to raise at least US$5bn in its H-share...

Sumeet Singh

FXI Rebalance Preview: GTJA, ZTE In; CTG, China Coal Out

There could be 2 changes for the FXI in March with Guotai Junan and ZTE replacing CTG and China Coal. There will be capping flows for Alibaba,...

Brian Freitas

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

NPC- Consumption Put Top of the Agenda, but Another Case of The “Boy Who Cried Wolf?”

​Investors feeling fatigued despite expected plans for boosting consumption in China, potential broadening of bull market beyond technology sector...

Rikki Malik

Consumer Stocks - Waiting to Catch a Fire

Budweiser Asia Pacific (1876.HK) is up 12% today as earnings are slightly less worse than expected and the dividend is increased. This confirms our...

Rikki Malik

FXI Rebalance Preview: Two Sets of Changes as ZTE Breaks Out, China Coal Dumps

GTJA and ZTE could replace CTG Duty Free and China Coal in the FXI ETF in March. Alibaba and Tencent will be sold on capping, Meituan bought. ZTE...

Brian Freitas

CATL A/H Listing - IPO Filing Updates

Contemporary Amperex Technology (CATL), one of the world’s largest battery solutions providers, aims to raise at least US$5bn in its H-share...

Sumeet Singh

FXI Rebalance Preview: GTJA, ZTE In; CTG, China Coal Out

There could be 2 changes for the FXI in March with Guotai Junan and ZTE replacing CTG and China Coal. There will be capping flows for Alibaba,...

Brian Freitas

Investors feeling fatigued despite expected plans for boosting consumption in China, potential broadening of bull market beyond technology sector...