HK/China Equity Long-Short

Osbert Tang, CFA

Equity Capital Markets

Zhongji InnoLight / Equity Capital Markets

<ul>
<li>The IPO of <a href="https://www.smartkarma.com/entities/zhongji-innolight" target="_blank" data-smartkarma-citation="entities:55331:1" rel="noopener">Zhongji InnoLight (3308 HK)</a>, a leading global provider of optical interconnect solutions, which seeks HK$54.5bn, is the largest since 2019.</li>
<li>Its FY25-28F EPS CAGR will reach 89.8%, underpinned by the jump in revenue and expansion in margin. Its 1Q26 net profit has already surged by 262.3%.</li>
<li>The IPO is priced at a 17.7% HA discount. At a HK$1.2trn market capitalisation, pegging it to its A-share will give a price of HK$1,227, or a 21.5% upside.</li>
</ul>


The IPO of Zhongji InnoLight (3308 HK), a leading global provider of optical interconnect solutions, which seeks HK$54.5bn, is the largest since 2019.
Its FY25-28F EPS CAGR will reach 89.8%, underpinned by the jump in revenue and expansion in margin. Its 1Q26 net profit has already surged by 262.3%.
The IPO is priced at a 17.7% HA discount. At a HK$1.2trn market capitalisation, pegging it to its A-share will give a price of HK$1,227, or a 21.5% upside.


Zhongji InnoLight (3308 HK) IPO: Assessing the Valuation

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

Shenton Research

Shenton 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.

<ul>
<li>Zhongji Innolight, a global supplier of optical transceivers, launched its IPO to raise USD 7,021m through an A+H listing. GS, CICC, MS, and GF are the deal sponsors.</li>
<li>In this note, we look at the deal terms and provide our thoughts on valuation for the company.</li>
<li>We analyze reference A+H transactions, cornerstone and sponsor performance and assess the risk-reward of the deal.</li>
</ul>


Zhongji Innolight, a global supplier of optical transceivers, launched its IPO to raise USD 7,021m through an A+H listing. GS, CICC, MS, and GF are the deal sponsors.
In this note, we look at the deal terms and provide our thoughts on valuation for the company.
We analyze reference A+H transactions, cornerstone and sponsor performance and assess the risk-reward of the deal.


Zhongji Innolight (中际旭创) A+H IPO: Analysis of Deal Terms

Zhongji Innolight   / Equity Capital Markets

<ul>
<li>Zhongji Innolight, a global optical interconnect player, passed hearing for an A+H listing. GS, CICC, MS, and GF are the joint sponsors.</li>
<li>We look at the company's core segments: high-speed and mid-to-low-speed optical transceivers.</li>
<li>We discussed our preliminary thoughts on the company's valuation based on A-H premium.</li>
</ul>


Zhongji Innolight, a global optical interconnect player, passed hearing for an A+H listing. GS, CICC, MS, and GF are the joint sponsors.
We look at the company's core segments: high-speed and mid-to-low-speed optical transceivers.
We discussed our preliminary thoughts on the company's valuation based on A-H premium.


Zhongji Innolight (中际旭创) A+H Pre-IPO: Early Thoughts

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 analyse the changes of A-H premium on 195 stocks over the last week. The average A-H premium was 83.0% as of Jul 17th.</li>
<li>The average A-H premium changed by -1.9ppt week-on-week, led by real estate, consumer staples, energy.</li>
<li>We highlight weekly changes in A-H premium for Hua Hong Semi, Innocare, Yofc, China Life, Zijin Mining.</li>
</ul>


We analyse the changes of A-H premium on 195 stocks over the last week. The average A-H premium was 83.0% as of Jul 17th.
The average A-H premium changed by -1.9ppt week-on-week, led by real estate, consumer staples, energy.
We highlight weekly changes in A-H premium for Hua Hong Semi, Innocare, Yofc, China Life, Zijin Mining.


A-H Premium Weekly (Jul 17th): Hua Hong Semi, Innocare, Yofc, China Life, Zijin Mining

<ul>
<li>We analyse the changes of A-H premium on 190 stocks over the last week. The average A-H premium was 85.5% as of Jul 10th.</li>
<li>The average A-H premium changed by 0.3ppt week-on-week, led by real estate, information technology, communication services and offset by utilities, health care, consumer discretionary.</li>
<li>We highlight weekly changes in A-H premium for Hua Hong Semi, Smic, Yangtze Optical Fibre And-H, Innocare.</li>
</ul>


We analyse the changes of A-H premium on 190 stocks over the last week. The average A-H premium was 85.5% as of Jul 10th.
The average A-H premium changed by 0.3ppt week-on-week, led by real estate, information technology, communication services and offset by utilities, health care, consumer discretionary.
We highlight weekly changes in A-H premium for Hua Hong Semi, Smic, Yangtze Optical Fibre And-H, Innocare.


A-H Premium Weekly (Jul 10th): Hua Hong Semi, Smic, Yangtze Optical Fibre And-H, Innocare

China

CIG Shanghai Co., Ltd. operates as a communications equipment manufacturing company. The Company develops, manufactures, and sells telecom broadband terminals, wireless network equipment, and smart home gateway products. CIG Shanghai markets its products worldwide.

Price Gauge
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Cig Shanghai (603083 CH)

Zhongji InnoLight (3308 HK) IPO: Assessing the Valuation

Zhongji InnoLight's IPO seeks HK$54.5bn, with strong growth projections. Priced at a 17.7% HA discount, there is potential for 21.5% upside if we...

Osbert Tang, CFA

Zhongji Innolight (中际旭创) A+H IPO: Analysis of Deal Terms

We analyze Zhongji Innolight's USD 7,021m Hong Kong IPO. We look at deal terms, track records of cornerstone investors and sponsors, as well as its...

Ke Yan, CFA, FRM

Zhongji Innolight (中际旭创) A+H Pre-IPO: Early Thoughts

Zhongji Innolight passed hearing for an A+H listing. In this note, we look at the company's business, its industry context and provide our early...

Ke Yan, CFA, FRM

A-H Premium Weekly (Jul 17th): Hua Hong Semi, Innocare, Yofc, China Life, Zijin Mining

We analyzed A-H premium changes in the past week and highlight A-H premium changes for Hua Hong Semi, Innocare, Yofc, China Life, Zijin Mining.

Ke Yan, CFA, FRM

A-H Premium Weekly (Jul 10th): Hua Hong Semi, Smic, Yangtze Optical Fibre And-H, Innocare

We analyzed A-H premium changes in the past week and highlight A-H premium changes for Hua Hong Semi, Smic, Yangtze Optical Fibre And-H, Innocare.

Ke Yan, CFA, FRM

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Zhongji InnoLight (3308 HK) IPO: Assessing the Valuation

​Zhongji InnoLight's IPO seeks HK$54.5bn, with strong growth projections. Priced at a 17.7% HA discount, there is potential for 21.5% upside if we...

Osbert Tang, CFA

Zhongji Innolight (中际旭创) A+H IPO: Analysis of Deal Terms

We analyze Zhongji Innolight's USD 7,021m Hong Kong IPO. We look at deal terms, track records of cornerstone investors and sponsors, as well as its...

Ke Yan, CFA, FRM

Zhongji Innolight (中际旭创) A+H Pre-IPO: Early Thoughts

Zhongji Innolight passed hearing for an A+H listing. In this note, we look at the company's business, its industry context and provide our early...

Ke Yan, CFA, FRM

A-H Premium Weekly (Jul 17th): Hua Hong Semi, Innocare, Yofc, China Life, Zijin Mining

We analyzed A-H premium changes in the past week and highlight A-H premium changes for Hua Hong Semi, Innocare, Yofc, China Life, Zijin Mining.

Ke Yan, CFA, FRM

A-H Premium Weekly (Jul 10th): Hua Hong Semi, Smic, Yangtze Optical Fibre And-H, Innocare

We analyzed A-H premium changes in the past week and highlight A-H premium changes for Hua Hong Semi, Smic, Yangtze Optical Fibre And-H, Innocare.

Ke Yan, CFA, FRM

Zhongji InnoLight's IPO seeks HK$54.5bn, with strong growth projections. Priced at a 17.7% HA discount, there is potential for 21.5% upside if we...