Global Emerging Market Equities, Propitious Research

Wium Malan, CFA

Global Emerging Market Equities

Independent, Fundamental Quantitative Research

Propitious Research

Fully independent, fundamental and quantitative equity research, focused on companies in the Telecommunication, Media, Technology, Internet and Healthcare sectors in the Global Emerging Markets. Idea generation focused on Quality stocks, trading below their intrinsic Value, with sound Corporate Governance.

Quantitative Analysis

<ul>
<li>During 3Q2024, the 200 largest weighted companies in the GEM index reported average EPS growth of +14.3%y/y, accelerating from the +7.1% reported during 2Q2024.</li>
<li>Overall, 59% of companies delivered positive EPS surprises, and 63% delivered positive Sales surprises, a continuation of the positive trend witnessed in the previous quarter.</li>
<li>Historically, there has been a significant difference in relative share price performance between the largest positive versus negative surprise generators, for 3 months after the reporting date.</li>
</ul>


During 3Q2024, the 200 largest weighted companies in the GEM index reported average EPS growth of +14.3%y/y, accelerating from the +7.1% reported during 2Q2024.
Overall, 59% of companies delivered positive EPS surprises, and 63% delivered positive Sales surprises, a continuation of the positive trend witnessed in the previous quarter.
Historically, there has been a significant difference in relative share price performance between the largest positive versus negative surprise generators, for 3 months after the reporting date.


Global Emerging Markets: Reporting Season Summary, 3Q2024

Index Rebal Trades & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal Trades & Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Index Rebalance

<ul>
<li>The HSTECH Index tracks the performance of the top 30 technology companies listed in Hong Kong that have high business exposure to certain technology themes.</li>
<li>In this insight, we take a look at the final rankings of potential ADDs and potential DELs for the December 2024 index rebal event.</li>
<li>We do not expect any changes for the HSTECH index in December 2024. However, we expect there to be capping flows of US$1,079mn one-way.</li>
</ul>


The HSTECH Index tracks the performance of the top 30 technology companies listed in Hong Kong that have high business exposure to certain technology themes.
In this insight, we take a look at the final rankings of potential ADDs and potential DELs for the December 2024 index rebal event.
We do not expect any changes for the HSTECH index in December 2024. However, we expect there to be capping flows of US$1,079mn one-way.


Quiddity Leaderboard HSTECH Dec 24: Midea Group Question Mark and Final Rankings for Exp ADDs/DELs

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

China Resources Beverage / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/china-resources-beverage" target="_blank" data-smartkarma-citation="entities:41984:1" rel="noopener">China Resources Beverage (CRB HK)</a> is looking to raise up to US$1bn in its upcoming Hong Kong IPO. </li>
<li>China Resources Beverage manufactures and sells packaged drinking water and RTD soft beverages in China.</li>
<li>In our earlier notes, we talked about the company’s past performance and provided our thoughts on valuations. In this note, we will look at updates from its most recent filings.</li>
</ul>



China Resources Beverage (CRB HK) is looking to raise up to US$1bn in its upcoming Hong Kong IPO. 
China Resources Beverage manufactures and sells packaged drinking water and RTD soft beverages in China.
In our earlier notes, we talked about the company’s past performance and provided our thoughts on valuations. In this note, we will look at updates from its most recent filings.


China Resources Beverage Pre-IPO - PHIP Updates - Revenue Slowing, Margins Growing

<ul>
<li>An overview (and output) of our machine learning-driven GEM screening model, which seeks to find the best medium-term long ideas within the top 100 stocks in the MSCI GEM Index.</li>
<li>The model is based on 1) a quantitative multifactor screening model, enhanced by two AI Technology-based approaches; 2) a Deep Neural Network model, and 3) a Recurrent Neural Network model.</li>
<li>Developed over roughly 4 years and implemented in its current state for over 3 years, the model has a solid real-world alpha-generating performance track record, discussed in detail below.</li>
</ul>


An overview (and output) of our machine learning-driven GEM screening model, which seeks to find the best medium-term long ideas within the top 100 stocks in the MSCI GEM Index.
The model is based on 1) a quantitative multifactor screening model, enhanced by two AI Technology-based approaches; 2) a Deep Neural Network model, and 3) a Recurrent Neural Network model.
Developed over roughly 4 years and implemented in its current state for over 3 years, the model has a solid real-world alpha-generating performance track record, discussed in detail below.


Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

<ul>
<li>The review period for the December rebalance of the <a href="https://www.smartkarma.com/entities/hang-seng-tech-index" target="_blank" data-smartkarma-citation="entities:31367:1" rel="noopener">Hang Seng TECH Index (HSTECH INDEX)</a> ended on 30 September.</li>
<li>We do not forecast any constituent changes for the index. Capping changes will lead to a one-way turnover of 2.15% and a round-trip trade of HK$6.1bn (US$785m).</li>
<li>If any stocks have outsized moves on expectations of being added to or deleted from the index, there could be opportunities to enter trades.</li>
</ul>


The review period for the December rebalance of the Hang Seng TECH Index (HSTECH INDEX) ended on 30 September.
We do not forecast any constituent changes for the index. Capping changes will lead to a one-way turnover of 2.15% and a round-trip trade of HK$6.1bn (US$785m).
If any stocks have outsized moves on expectations of being added to or deleted from the index, there could be opportunities to enter trades.


HSTECH Index Rebalance Preview: $800m Round-Trip Trade

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.

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JD.com (9618 HK)

Global Emerging Markets: Reporting Season Summary, 3Q2024

In this quarterly insight, we analyse recent GEM reporting trends by looking at Sales and EPS growth, size and percentage of positive surprises,...

Wium Malan, CFA

Quiddity Leaderboard HSTECH Dec 24: Midea Group Question Mark and Final Rankings for Exp ADDs/DELs

Our current estimate of US$1,079mn one-way capping flow translates to a turnover of 4.4%. The final capping flows will be decided based on the...

Janaghan Jeyakumar, CFA

China Resources Beverage Pre-IPO - PHIP Updates - Revenue Slowing, Margins Growing

China Resources Beverage (CRB HK) is looking to raise up to US$1bn in its upcoming Hong Kong IPO. In this note, we talk about updates from its PHIP...

Sumeet Singh

Screening for GEMs: October 2024

This insight provides an overview of our, machine learning-driven, proprietary GEM screening model, based on a Multifactor model, a Deep Neural...

Wium Malan, CFA

HSTECH Index Rebalance Preview: $800m Round-Trip Trade

We do not forecast any constituent changes for the HSTECH index in December. Capping changes will lead to a one-way turnover of 2.15% and a round...

Brian Freitas

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52-week Range

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P/E

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