Overseas Chinese Equities, Aequitas Research

Ming Lu

Overseas Chinese Equities

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 Bottom-Up

<ul>
<li>The de facto total revenue increased by 10% YoY excluding two disposed shopping malls.</li>
<li>We believe Alibaba will win the price war for food deliveries, because competitors’ earnings were even worse.</li>
<li>The stock surged by 13% in NYSE after the result release, but we still believe it has an upside of 48% for next twelve months.</li>
</ul>


The de facto total revenue increased by 10% YoY excluding two disposed shopping malls.
We believe Alibaba will win the price war for food deliveries, because competitors’ earnings were even worse.
The stock surged by 13% in NYSE after the result release, but we still believe it has an upside of 48% for next twelve months.


Alibaba (BABA, 9988HK): June Quarter, Actually 2-Digit Growth, To Win Price War

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/lifestyle-china-group-ltd" target="_blank" data-smartkarma-citation="entities:26090:1" rel="noopener">Lifestyle China (2136 HK)</a>’s IFA opines that Mr Thomas Lau’s HK$0.98 privatisation offer is fair and reasonable. The vote is on 20 February. </li>
<li>The IFA analysis is flawed. The revised and final offer is light compared to precedent transactions, peer multiples and historical trading ranges.</li>
<li>The high AGM minority participation rates remain a vote risk, mainly as retail seems firmly against the offer. The 14.0% gross spread is high but justified. </li>
</ul>



Lifestyle China (2136 HK)’s IFA opines that Mr Thomas Lau’s HK$0.98 privatisation offer is fair and reasonable. The vote is on 20 February. 
The IFA analysis is flawed. The revised and final offer is light compared to precedent transactions, peer multiples and historical trading ranges.
The high AGM minority participation rates remain a vote risk, mainly as retail seems firmly against the offer. The 14.0% gross spread is high but justified. 


Lifestyle China (2136 HK): Expectations of a Deal Break with a Vote on 20 February

<ul>
<li>
<a href="https://www.smartkarma.com/entities/lifestyle-china-group-ltd" target="_blank" data-smartkarma-citation="entities:26090:1" rel="noopener">Lifestyle China (2136 HK)</a> disclosed a revised offer from Mr Thomas Lau at HK$0.98 per share, a 7.3% premium to the previous HK$0.913 offer. The offer has been declared final. </li>
<li>The bump was unsurprising. Crucially, the shares have traded above the revised offer on 20 of the 25 trading days since the previous offer was announced. </li>
<li>The revised offer remains light, and minorities remain unimpressed. The high AGM minority participation rates remain a vote risk. Head for the exit as the shares are trading at terms. </li>
</ul>



Lifestyle China (2136 HK) disclosed a revised offer from Mr Thomas Lau at HK$0.98 per share, a 7.3% premium to the previous HK$0.913 offer. The offer has been declared final. 
The bump was unsurprising. Crucially, the shares have traded above the revised offer on 20 of the 25 trading days since the previous offer was announced. 
The revised offer remains light, and minorities remain unimpressed. The high AGM minority participation rates remain a vote risk. Head for the exit as the shares are trading at terms. 


Lifestyle China (2136 HK): Thomas Lau Bumps, but the Offer Remains Light

<ul>
<li>
<a href="https://www.smartkarma.com/entities/lifestyle-china-group-ltd" target="_blank" data-smartkarma-citation="entities:26090:1" rel="noopener">Lifestyle China (2136 HK)</a> disclosed a Cayman scheme privatisation offer from Mr Thomas Lau at HK$0.913 per share, a 21.7% premium to the last close price of HK$0.75. </li>
<li>The offer is unattractive compared to precedent transactions, peer multiples, and historical trading ranges. It has not been declared final. </li>
<li>While no shareholder holds a blocking stake, the high AGM minority participation rates and emerging retail opposition suggest a high chance of a deal break. Therefore, a bump is probable.</li>
</ul>



Lifestyle China (2136 HK) disclosed a Cayman scheme privatisation offer from Mr Thomas Lau at HK$0.913 per share, a 21.7% premium to the last close price of HK$0.75. 
The offer is unattractive compared to precedent transactions, peer multiples, and historical trading ranges. It has not been declared final. 
While no shareholder holds a blocking stake, the high AGM minority participation rates and emerging retail opposition suggest a high chance of a deal break. Therefore, a bump is probable.


Lifestyle China (2136 HK): Thomas Lau’s Low-Balled Scheme Offer

<ul>
<li>
<a href="https://www.smartkarma.com/entities/lifestyle-china-group-ltd" target="_blank" data-smartkarma-citation="entities:26090:1" rel="noopener">Lifestyle China (2136 HK)</a> is on a trading halt pending the release of an announcement under the Hong Kong Code on Takeovers and Mergers. </li>
<li>Mr Thomas Lau (Chairman and CEO) is likely following up on the privatisation of <a href="https://www.smartkarma.com/entities/lifestyle-international-holdings-ltd" target="_blank" data-smartkarma-citation="entities:112:1" rel="noopener">Lifestyle International Holdings (1212 HK)</a> with the privatisation of Lifestyle China.  </li>
<li>We use three methods to triangulate the likely offer price, suggesting a range of HK$1.00-1.45 per share, with an average of HK$1.23 (a 63.3% premium to the last close).</li>
</ul>



Lifestyle China (2136 HK) is on a trading halt pending the release of an announcement under the Hong Kong Code on Takeovers and Mergers. 
Mr Thomas Lau (Chairman and CEO) is likely following up on the privatisation of Lifestyle International Holdings (1212 HK) with the privatisation of Lifestyle China.  
We use three methods to triangulate the likely offer price, suggesting a range of HK$1.00-1.45 per share, with an average of HK$1.23 (a 63.3% premium to the last close).


Lifestyle China (2136 HK): Chairman/CEO to Launch Privatisation Offer?

China

Intime Retail is a leading department store chain and mall operator in China, focusing on integrating online and offline shopping experiences and offering a wide range of retail goods and services. The company was founded in 1998 and is headquartered in Hangzhou, China.

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Intime Retail (1612890D HK)

Alibaba (BABA, 9988HK): June Quarter, Actually 2-Digit Growth, To Win Price War

The de facto total revenue increased by 10% YoY excluding two disposed shopping malls. We believe Alibaba will win the price war for food...

Ming Lu

Lifestyle China (2136 HK): Expectations of a Deal Break with a Vote on 20 February

As expected, the scheme vote failed. The minority participation rate was high at 43.28%. The results showed that 17.25% of disinterested...

Arun George

Lifestyle China (2136 HK): Thomas Lau Bumps, but the Offer Remains Light

The revised offer remains light. The high AGM minority participation rates remain a vote risk. Head for the exit as the shares are trading at the...

Arun George

Lifestyle China (2136 HK): Thomas Lau’s Low-Balled Scheme Offer

While no shareholder holds a blocking stake, the high AGM minority participation rates and emerging retail opposition suggest a high chance of a...

Arun George

Lifestyle China (2136 HK): Chairman/CEO to Launch Privatisation Offer?

We use three methods to triangulate the likely offer price, suggesting a range of HK$1.00-1.45 per share, with an average of HK$1.23 (a 63.3%...

Arun George

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