Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>The SEC has finalised the Holding Foreign Companies Accountable Act rules. Under the current timeframe, the SEC may force the delisting of foreign companies in three years if in contravention.</li>
<li>Amid <a href="https://www.smartkarma.com/entities/didi-chuxing-inc" target="_blank" data-smartkarma-citation="entities:27467:1" rel="noopener">DiDi Global (DIDI US)</a>'s intention to delist from the US, the CSRC refutes it is pushing for VIEs to drop their listings in the United States.</li>
<li>Expect continued volatility as the ~248 US-listed China plays seek to avoid delisting if they don’t comply with auditing rules.</li>
</ul>


The SEC has finalised the Holding Foreign Companies Accountable Act rules. Under the current timeframe, the SEC may force the delisting of foreign companies in three years if in contravention.
Amid DiDi Global (DIDI US)'s intention to delist from the US, the CSRC refutes it is pushing for VIEs to drop their listings in the United States.
Expect continued volatility as the ~248 US-listed China plays seek to avoid delisting if they don’t comply with auditing rules.


Delisting Chinese ADRs: High Foreign-Holding, With No Fixed Abode, Most At Risk

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

<ul>
<li>Kanzhun, an online recruitment platform in China, raised around US$1bn in its US IPO in Jun 2021.</li>
<li>The company is backed by Tencent and pre-IPO financial investors own over 50% of the company.</li>
<li>In this note, we look at the updates since listing and the impact of the upcoming lock-up expiry.</li>
</ul>


Kanzhun, an online recruitment platform in China, raised around US$1bn in its US IPO in Jun 2021.
The company is backed by Tencent and pre-IPO financial investors own over 50% of the company.
In this note, we look at the updates since listing and the impact of the upcoming lock-up expiry.


Kanzhun Lock-Up - Has Held up Remarkably Well with All Pre-IPO Shareholders Well in the Money

Silver Point

Thomas J. Monaco

Silver Point is a boutique research firm that focuses on the broader financial services sector, with a particular focus on troubled institutions globally. 

Asia Ex Japan

Equity Bottom-Up

<ul>
<li>
Management Shake-up: Alibaba Group Holding (BABA.US) [Alibaba] announced that long-time CFO Maggie Wu will be stepping down in April 2022;</li>
<li>
Restructure: Alibaba also announced that it will be reorganizing its international and domestic e-commerce businesses; and</li>
<li>
Further Pressure:Just last month, Alibaba reduced its revenue growth forecast. The formation of a financial holding company will cause earnings to compress while capital requirements increase.</li>
</ul>



Management Shake-up: Alibaba Group Holding (BABA.US) [Alibaba] announced that long-time CFO Maggie Wu will be stepping down in April 2022;

Restructure: Alibaba also announced that it will be reorganizing its international and domestic e-commerce businesses; and

Further Pressure:Just last month, Alibaba reduced its revenue growth forecast. The formation of a financial holding company will cause earnings to compress while capital requirements increase.


Alibaba Group Holding – Palace Intrigue

<ul>
<li>On 2nd Dec 2021, Didi announced that it would look to delist its ADRs from NYSE and it would seek a listing on HKSE.</li>
<li>The stock has been at the center of a regulatory crackdown since its IPO in Jun 2021. </li>
<li>Apart from the delisting and relisting flows, it now also has US$20bn of stock coming up for lock-up expiry.</li>
</ul>


On 2nd Dec 2021, Didi announced that it would look to delist its ADRs from NYSE and it would seek a listing on HKSE.
The stock has been at the center of a regulatory crackdown since its IPO in Jun 2021. 
Apart from the delisting and relisting flows, it now also has US$20bn of stock coming up for lock-up expiry.


DiDi Chuxing: Delisting - Relisting + US$20bn Lockup Expiry = Big Mess

Forensic Analyst

Jason Yap, CFA

Forensic Accounting

<ul>
<li>Didi's announced that it would delist from US and prepare for a public listing in Hongkong</li>
<li>Didi is racing against time to do so due to various factors such as, lock-up expiry, HK Stock Exchange review of listing applications, and potential cybersecurity review for HK issuers</li>
<li>There could be parallels in terms of key risks for other non-dual listed China ADSs</li>
</ul>


Didi's announced that it would delist from US and prepare for a public listing in Hongkong
Didi is racing against time to do so due to various factors such as, lock-up expiry, HK Stock Exchange review of listing applications, and potential cybersecurity review for HK issuers
There could be parallels in terms of key risks for other non-dual listed China ADSs


Didi (Didi US)'s Delisting and Its Implications for Non-Dual Listed China ADS

China

DiDi Chuxing Inc operates passenger transportation platforms. The Company provides mobility solutions, cloud computing, and other application based services. DiDi Chuxing serves customers worldwide.

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DiDi Global (DIDIY US)

Delisting Chinese ADRs: High Foreign-Holding, With No Fixed Abode, Most At Risk

This does not strike me as the time to be bargain hunting. Not when there remains confusion as to how and when delistings will unfold. The focus...

David Blennerhassett

Kanzhun Lock-Up - Has Held up Remarkably Well with All Pre-IPO Shareholders Well in the Money

Kanzhun, an online recruitment platform in China, raised around US$1bn in its US IPO in Jun 2021. In this note, we will talk about the upcoming...

Sumeet Singh

Alibaba Group Holding – Palace Intrigue

ALIBABA: Alibaba announced that long-time CFO Maggie Wu will be stepping down in April 2022, and that it will be reorganizing its international and...

Thomas J. Monaco

DiDi Chuxing: Delisting - Relisting + US$20bn Lockup Expiry = Big Mess

On 2nd Dec 2021, Didi announced that it would look to delist its ADRs from NYSE and it would seek a listing on HKSE. The company also has US$20bn...

Sumeet Singh

Didi (Didi US)'s Delisting and Its Implications for Non-Dual Listed China ADS

As Didi races against time to delist from US, it faces, amongst others, lock-up expiry, HK listing review, and potential cybersecurity review. What...

Jason Yap, CFA

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