HK/China Equity Long-Short

Osbert Tang, CFA

Thematic (Sector/Industry)

<ul>
<li>The recent surge in Eurozone sovereign yields, particularly for France, has created pressure on the outlook for some HK-listed companies. </li>
<li>While the 100 largest companies generated an average of only 6% of revenue from Europe, 10 companies derived over 20%.</li>
<li>
<a href="https://www.smartkarma.com/entities/ck-hutchison-holdings-ltd" target="_blank" data-smartkarma-citation="entities:132:1" rel="noopener">CK Hutchison (1 HK)</a> group, <a href="https://www.smartkarma.com/entities/shein-global-holdings-limited" target="_blank" data-smartkarma-citation="entities:55372:1" rel="noopener">SHEIN Global (625 HK)</a>, <a href="https://www.smartkarma.com/entities/xiaomi-corporation-class-b" target="_blank" data-smartkarma-citation="entities:24409:1" rel="noopener">Xiaomi (1810 HK)</a>, <a href="https://www.smartkarma.com/entities/lenovo-group-limited" target="_blank" data-smartkarma-citation="entities:13359:1" rel="noopener">Lenovo (992 HK)</a>, <a href="https://www.smartkarma.com/entities/wuxi-biologics-cayman-inc" target="_blank" data-smartkarma-citation="entities:23679:1" rel="noopener">Wuxi Biologics (2269 HK)</a> group, and <a href="https://www.smartkarma.com/entities/cosco-shipping-holdings-co-ltd-class-h" target="_blank" data-smartkarma-citation="entities:286:1" rel="noopener">COSCO SHIPPING Holdings (1919 HK)</a> are the top. </li>
</ul>


The recent surge in Eurozone sovereign yields, particularly for France, has created pressure on the outlook for some HK-listed companies. 
While the 100 largest companies generated an average of only 6% of revenue from Europe, 10 companies derived over 20%.

CK Hutchison (1 HK) group, SHEIN Global (625 HK), Xiaomi (1810 HK), Lenovo (992 HK), Wuxi Biologics (2269 HK) group, and COSCO SHIPPING Holdings (1919 HK) are the top. 


HK Strategy: Exposure to Europe - Who Are at Risk?

Healthcare Analyst

Wilfred Yuen

<ul>
<li>Arrivent's EGFR inhibitor firmonertinib (licensed from Shanghai-based Allist) failed a global phase 3 in lung cancer; argenx discontinued phase 3 of efgartigimod (ZLAB licensed its China rights) in Sjogren’s disease</li>
<li>Asieris (688176.CH) licensed out cervical precancerous treatment Cevira to Theramex for US$250m; MicuRx (688373.CH) licensed out MRX-23 ADC and STOPIN platform to ClearideBio in multi-asset global deal for US$973m (upfront US$100m).</li>
<li>Other updates/news: Genscript/NVIDIA, SBP's PDE3/4 inhibitor, ZhongSheng Pharma's biweekly GLP-1/GIP</li>
</ul>


Arrivent's EGFR inhibitor firmonertinib (licensed from Shanghai-based Allist) failed a global phase 3 in lung cancer; argenx discontinued phase 3 of efgartigimod (ZLAB licensed its China rights) in Sjogren’s disease
Asieris (688176.CH) licensed out cervical precancerous treatment Cevira to Theramex for US$250m; MicuRx (688373.CH) licensed out MRX-23 ADC and STOPIN platform to ClearideBio in multi-asset global deal for US$973m (upfront US$100m).
Other updates/news: Genscript/NVIDIA, SBP's PDE3/4 inhibitor, ZhongSheng Pharma's biweekly GLP-1/GIP


Global Healthcare Analyst

Tina Banerjee

Equity Capital Markets

GenScript Biotech / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/genscript-biotech-corporation" target="_blank" data-smartkarma-citation="entities:21041:1" rel="noopener">GenScript Biotech (1548 HK)</a> is placing 77M shares at the price of HK$30.50 per placing share. Placing shares represent approximately 3.5% of the total number of issued shares.</li>
<li>The company intends to use the proceeds mainly for expansion of capacity and infrastructure of AI-driven drug discovery platform, including automated high-throughput wet-lab facilities, related equipment, and laboratory upgrades.</li>
<li>GenScript is witnessing accelerating demand for AIDD. During 1H26, AIDD business doubled and maintained rapid growth for a third consecutive half-year reporting period.</li>
</ul>



GenScript Biotech (1548 HK) is placing 77M shares at the price of HK$30.50 per placing share. Placing shares represent approximately 3.5% of the total number of issued shares.
The company intends to use the proceeds mainly for expansion of capacity and infrastructure of AI-driven drug discovery platform, including automated high-throughput wet-lab facilities, related equipment, and laboratory upgrades.
GenScript is witnessing accelerating demand for AIDD. During 1H26, AIDD business doubled and maintained rapid growth for a third consecutive half-year reporting period.


GenScript Biotech (1548 HK): Placing Shares to Fund AIDD Capex Amid Accelerating Demand

APAC IPOs & Placements, Aequitas Research

Akshat Shah

APAC 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.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/genscript-biotech-corporation" target="_blank" data-smartkarma-citation="entities:21041:1" rel="noopener">GenScript Biotech (1548 HK)</a> is looking to raise up to US$300m from a primary placement. Proceeds are to be used for capacity expansion and platform infrastructure purposes.</li>
<li>Genscript Biotech is a global life-science platform spanning research tools and services, biologics CDMO (ProBio) and industrial synthetic biology, with additional exposure to cell therapy through Legend Biotech.</li>
<li>In this note, we will talk about the placement and run the deal through our ECM framework.</li>
</ul>



GenScript Biotech (1548 HK) is looking to raise up to US$300m from a primary placement. Proceeds are to be used for capacity expansion and platform infrastructure purposes.
Genscript Biotech is a global life-science platform spanning research tools and services, biologics CDMO (ProBio) and industrial synthetic biology, with additional exposure to cell therapy through Legend Biotech.
In this note, we will talk about the placement and run the deal through our ECM framework.


Aequitas: Genscript Biotech Placement - Earnings-Led Inflection; Re-Rating May Limit Upside

Equity Bottom-Up

<ul>
<li>
1H26 results driven by AI orders, with life sciences segment revenue up 26% YoY (or +16% HoH) and adjusted operating profit up 103% YoY to US$94m.</li>
<li>
2026 guidance upgrade: 1) Life science: 25-30% revenue growth (vs. 15-18% prior), with adjusted OPM: 25%+ (vs. 19% prior); 2) Probio: 25-30% fee-for-service revenue growth (vs. 20-25% prior)</li>
<li>
At US$7.2bn mkt cap (vs. TWST: US$7.4bn), our back-of-envelop calculation indicates ~36x 2027E P/E. Genscript holds net cash of US$638m and 45% stake in LEGN. See inside for call takeaways</li>
</ul>



1H26 results driven by AI orders, with life sciences segment revenue up 26% YoY (or +16% HoH) and adjusted operating profit up 103% YoY to US$94m.

2026 guidance upgrade: 1) Life science: 25-30% revenue growth (vs. 15-18% prior), with adjusted OPM: 25%+ (vs. 19% prior); 2) Probio: 25-30% fee-for-service revenue growth (vs. 20-25% prior)

At US$7.2bn mkt cap (vs. TWST: US$7.4bn), our back-of-envelop calculation indicates ~36x 2027E P/E. Genscript holds net cash of US$638m and 45% stake in LEGN. See inside for call takeaways


Genscript (1548.HK): 1H26 Results Driven by AI Orders; Guidance Upgrades on Life-Science and Probio

China

GenScript Biotech is a global biotechnology company providing life science research services and products, including gene synthesis, peptide synthesis, protein production, and antibody development. It also offers biologics contract development and manufacturing (CDMO) services and industrial synthetic biology products. The company was founded in 2002 and is headquartered in Nanjing, China.

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GenScript Biotech (1548 HK)

HK Strategy: Exposure to Europe - Who Are at Risk?

A recent surge in Eurozone sovereign yields will put pressure on some companies. The 100 largest HK companies have only 6% of their revenue from...

Osbert Tang, CFA

China Healthcare Weekly Wrap (5-9 Oct)

Key news this week: 1) Arrivent's ph3 lung cancer study flop, 2) efgartigimod (argenx/ZLAB) discontinued in a ph3 study in Sjogren’s disease, 3)...

Wilfred Yuen