Equity Analyst, LightStream Research

Oshadhi Kumarasiri

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Equity Bottom-Up

<ul>
<li>Jack Ma’s internet empire has been in disarray recently. It began when Chinese regulators halted the $35 billion IPO of <a href="https://www.smartkarma.com/entities/alibaba-group" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba Group (9988 HK)</a> spinoff, <a href="https://www.smartkarma.com/entities/ant-financial-services-group" target="_blank" data-smartkarma-citation="entities:24240:1" rel="noopener">Ant Group (6688 HK)</a>, the world's largest financial technology company.</li>
<li>Earlier in the month, China’s top antitrust watchdog, The State Administration for Market Regulation (SAMR), fined Alibaba RMB 500,000 for not making adequate declarations to authorities about past acquisitions.</li>
<li>Last week, SAMR filled an investigation into Alibaba’s suspected monopolistic practices and The People's Bank of China ordered Ant group to formulate a rectification plan and an implementation timetable to comply with new regulatory and anti-monopoly requirements.</li>
</ul>


Jack Ma’s internet empire has been in disarray recently. It began when Chinese regulators halted the $35 billion IPO of Alibaba Group (9988 HK) spinoff, Ant Group (6688 HK), the world's largest financial technology company.
Earlier in the month, China’s top antitrust watchdog, The State Administration for Market Regulation (SAMR), fined Alibaba RMB 500,000 for not making adequate declarations to authorities about past acquisitions.
Last week, SAMR filled an investigation into Alibaba’s suspected monopolistic practices and The People's Bank of China ordered Ant group to formulate a rectification plan and an implementation timetable to comply with new regulatory and anti-monopoly requirements.


Jack Ma in Xi’s Crosshairs: Alibaba Could Be Collateral Damage

Asian Equities Analyst, Logistics & Transport, Tracking Traffic

Daniel Hellberg

Asian Equities Analyst, Logistics & Transport

Tracking Traffic

Focusing on Asian logistics, transportation, and travel companies

Event-Driven

China Logistics Property Holdings / Event-Driven

<section class="figure"><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/180/424/original/BANNER-TTOtherDec20_GreyOrange.png?1609259067" class="editor-image img-responsive" data-smartkarma-image-id="180424"></figure></section><p>On Tuesday <a href="https://www.smartkarma.com/entities/china-logistics-property-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:22799:1" rel="noopener">China Logistics Property Holdings (1589 HK)</a> released a statement that confirmed chatter indicating two major shareholders are considering a sale of their stakes, which total 51.5%.</p><p>In this note we attempt to put the potential sale of controlling stakes in CLPH (or the entire company) into context by looking at the 2017 privatization of <a href="https://www.smartkarma.com/entities/global-logistic-properties-ltd" target="_blank" data-smartkarma-citation="entities:2894:1" rel="noopener">Global Logistic Properties (GLP SP)</a>, still the largest single owner of modern warehouse space in China. </p><p>We also provide a list of potential acquirers of the CLPH stakes, assuming a sale occurs eventually. In our view, there are at least seven companies that feature the financial might and the relationships needed to acquire CLPH's warehouse assets in China. </p><p>CLPH's shares are up about 35% YTD, but compared to GLP's EV/Portfolio and EV/Completed SQM multiples at the time of its privatization, valuations do not appear stretched. We believe suitors eager to add scarce Chinese warehouse assets could bid shares up above HK$5.0. </p>

On Tuesday China Logistics Property Holdings (1589 HK) released a statement that confirmed chatter indicating two major shareholders are considering a sale of their stakes, which total 51.5%.In this note we attempt to put the potential sale of controlling stakes in CLPH (or the entire company) into context by looking at the 2017 privatization of Global Logistic Properties (GLP SP), still the largest single owner of modern warehouse space in China. We also provide a list of potential acquirers of the CLPH stakes, assuming a sale occurs eventually. In our view, there are at least seven companies that feature the financial might and the relationships needed to acquire CLPH's warehouse assets in China. CLPH's shares are up about 35% YTD, but compared to GLP's EV/Portfolio and EV/Completed SQM multiples at the time of its privatization, valuations do not appear stretched. We believe suitors eager to add scarce Chinese warehouse assets could bid shares up above HK$5.0. 

Major Shareholders of CLPH (1589:HK) Selling! Revisiting Narrative & Valuations

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

<p>This week in StubWorld ...</p>
<p>Tech-giants such as <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent Holdings (700 HK)</a> are under the hammer as investors second-guess whether Chinese regulators are targeting only <a href="https://www.smartkarma.com/entities/alibaba-group" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba Group (9988 HK)</a> or a wider anti-trust mandate. </p>
<hr>
<div>
<p>Preceding my comments on <a href="https://www.smartkarma.com/entities/naspers-ltd" target="_blank" data-smartkarma-citation="entities:21085:1" rel="noopener">Naspers (NPN SJ)</a> / <a href="https://www.smartkarma.com/entities/prosus-nv" target="_blank" data-smartkarma-citation="entities:28104:1" rel="noopener">Prosus (PRX NA)</a> / Tencent are the weekly setup/unwind tables for Asia-Pacific Holdcos.</p>
</div>
<div>
<p>These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.</p>
</div>

This week in StubWorld ...
Tech-giants such as Tencent Holdings (700 HK) are under the hammer as investors second-guess whether Chinese regulators are targeting only Alibaba Group (9988 HK) or a wider anti-trust mandate. 


Preceding my comments on Naspers (NPN SJ) / Prosus (PRX NA) / Tencent are the weekly setup/unwind tables for Asia-Pacific Holdcos.


These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.


StubWorld: Tencent Under Pressure From Antitrust Push

<section class="figure"><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/180/014/original/BANNER-TTOtherDec20_GreyOrange.png?1608832116" class="editor-image img-responsive" data-smartkarma-image-id="180014"></figure></section><p>In November, anti-monopoly regulators announced drafts of new rules that will apply to eCommerce 'platform' businesses. And last week authorities announced an anti-monopoly probe into some of <a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd" target="_blank" data-smartkarma-citation="entities:787:1" rel="noopener">Alibaba Group (BABA US)</a>'s anti-competitive practices. We believe the probe could eventually extend to a range of logistics companies linked to Alibaba. </p><p>The ongoing regulator action against Alibaba's "choose one from two" policy and potential future actions against logistics firms linked to the eCommerce giant will have the same effect: to slow down growth. In the case of the Chinese express companies closely linked to Alibaba, regulators' actions merely add to existing pressures to pursue sector consolidation in 2021.</p><p>We recommend investors check out <a href="https://www.smartkarma.com/entities/best-inc" target="_blank" data-smartkarma-citation="entities:25494:1" rel="noopener">BEST Inc (BEST US)</a> as a potential acquisition target.</p>

In November, anti-monopoly regulators announced drafts of new rules that will apply to eCommerce 'platform' businesses. And last week authorities announced an anti-monopoly probe into some of Alibaba Group (BABA US)'s anti-competitive practices. We believe the probe could eventually extend to a range of logistics companies linked to Alibaba. The ongoing regulator action against Alibaba's "choose one from two" policy and potential future actions against logistics firms linked to the eCommerce giant will have the same effect: to slow down growth. In the case of the Chinese express companies closely linked to Alibaba, regulators' actions merely add to existing pressures to pursue sector consolidation in 2021.We recommend investors check out BEST Inc (BEST US) as a potential acquisition target.

Alibaba Anti-Trust Probe Could Slow Growth of Chinese Express Companies, Add to M&A Pressures

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.

<ul>
<li>The State Administration of Market Regulation (SAMR) formally started the investigation into the anti-monopoly of Alibaba (BABA) and Summoned Ant Group's management again.</li>
<li>JD Digits (JDD) changed CEO in the process of IPO due to the situation its competitor, Ant Group, is facing.</li>
<li>Youzu.com (002174 CN)’s founder was poisoned to death by his subordinate.</li>
<li>Baidu (BIDU) made a poster to call on students and their parents to boycott TikTok.</li>
</ul>


The State Administration of Market Regulation (SAMR) formally started the investigation into the anti-monopoly of Alibaba (BABA) and Summoned Ant Group's management again.
JD Digits (JDD) changed CEO in the process of IPO due to the situation its competitor, Ant Group, is facing.
Youzu.com (002174 CN)’s founder was poisoned to death by his subordinate.
Baidu (BIDU) made a poster to call on students and their parents to boycott TikTok.


China Internet Weekly (28Dec2020): BABA Investigated, Ant Warned, Youzu Founder Poisoned to Death

China

JD.com Inc is an online direct sales company in China.  The Company offers a wide selection of products through its website and mobile applications.  JD.com sells appliances, computers, digital products, communication products, garments, books, and household items to consumers and vendors.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

JD.com (ADR) (JD US)

Jack Ma in Xi’s Crosshairs: Alibaba Could Be Collateral Damage

The growing discord between Jack Ma and the government makes us second guess an investment in any Jack Ma related business regardless of their...

Oshadhi Kumarasiri

Major Shareholders of CLPH (1589:HK) Selling! Revisiting Narrative & Valuations

China Logistics Property Holdings isn't cheap, but the potential sale of controlling stakes in the company could draw strong interest from JD.com...

Tracking Traffic

StubWorld: Tencent Under Pressure From Antitrust Push

Stay long long Naspers vs Tencent. As we approach March, the likelihood that investors realise there could be another large offering increases,...

David Blennerhassett

Alibaba Anti-Trust Probe Could Slow Growth of Chinese Express Companies, Add to M&A Pressures

New scrutiny from regulators on Alibaba could result in increased financial pressures on the logistics firms linked to the eCommerce giant.

Tracking Traffic

China Internet Weekly (28Dec2020): BABA Investigated, Ant Warned, Youzu Founder Poisoned to Death

The State Administration of Market Regulation investigated Alibaba and Summoned Ant Group's management. JD Digits (JDD) changed CEO in the process...

Ming Lu

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)