Blue Lotus Research Institute

Andy Fu

China growth and global non-US Internet equities

Blue Lotus Research is a Hong Kong Type 4 Licensed investment advisory firm focusing on Chinese growth equities and global non-US Internet equities

Thematic (Sector/Industry)

<ul>
<li>Minister of MOHURD (Ministry of Housing and Urban Development) said on October 16th that MOHURD planned to renovate 1mn more shanty houses via 100% cash exchange by year end;</li>
<li>We estimate this would inject Rmb0.5-1tn to the hands of shanty town residents. If all these money are putt into the property market, it can drive up transaction by 3-7%;</li>
<li>However, property transaction showed existing home sales growth slowed in September and new home sales remained in negative. The real estate market is in dire need of further stimulus.</li>
</ul>


Minister of MOHURD (Ministry of Housing and Urban Development) said on October 16th that MOHURD planned to renovate 1mn more shanty houses via 100% cash exchange by year end;
We estimate this would inject Rmb0.5-1tn to the hands of shanty town residents. If all these money are putt into the property market, it can drive up transaction by 3-7%;
However, property transaction showed existing home sales growth slowed in September and new home sales remained in negative. The real estate market is in dire need of further stimulus.


Blue Lotus China New Economy Research, Blue Lotus Research Institute

Eric Wen

Blue Lotus China New Economy Research

<ul>
<li>It has become evident that Chinese economy needs stimulus. But why is it not happening? The latest by NDRC and MOF suggests US rate and presidential election are the keys;</li>
<li>What has come forward in the forms of local government debt swap and bank reserve injection is similar to fueling a liquid-fueled missile. Once it starts, it can't roll back;</li>
<li>The biggest swing factor from US presidential election is the Trump Tariff, which can cut China's GDP growth by half. The fueling hopefully can handle impact of such magnitude.</li>
</ul>


It has become evident that Chinese economy needs stimulus. But why is it not happening? The latest by NDRC and MOF suggests US rate and presidential election are the keys;
What has come forward in the forms of local government debt swap and bank reserve injection is similar to fueling a liquid-fueled missile. Once it starts, it can't roll back;
The biggest swing factor from US presidential election is the Trump Tariff, which can cut China's GDP growth by half. The fueling hopefully can handle impact of such magnitude.


What Is Chinese Government Waiting for to Stimulate Its Economy?

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

Index Rebalance

<ul>
<li>The WisdomTree Emerging Markets ex-State-Owned Enterprises Index measures the performance of emerging markets stocks that are not state-owned enterprises.</li>
<li>The changes at the October rebalance were announced after market close on 4 October with implementation scheduled at the close on 16 October.</li>
<li>There are 154 adds and 80 deletes for the index with an estimated round-trip trade of US$300m.</li>
</ul>


The WisdomTree Emerging Markets ex-State-Owned Enterprises Index measures the performance of emerging markets stocks that are not state-owned enterprises.
The changes at the October rebalance were announced after market close on 4 October with implementation scheduled at the close on 16 October.
There are 154 adds and 80 deletes for the index with an estimated round-trip trade of US$300m.


WisdomTree Emerging Markets Ex-State-Owned Enterprises Index Rebalance: US$300m Round-Trip Trade

<ul>
<li>BEKE US/BZ US/ATAT US/3690 HK/TCOM US:September Politburo Meeting Unusually Discusses Economic Topics, bodes well for catering and tourism consumption, Employment, and Real Estate(+)</li>
<li>2618 HK/002352 CH: JD and Alibaba reconcile, JD Logistics to launch on Taobao and Alipay to launch on JD.com (+/-)</li>
<li>NIO US: NIO Lowers Battery Swap Service Fees to Encourage Frequent Battery Swaps(-)</li>
</ul>


BEKE US/BZ US/ATAT US/3690 HK/TCOM US:September Politburo Meeting Unusually Discusses Economic Topics, bodes well for catering and tourism consumption, Employment, and Real Estate(+)
2618 HK/002352 CH: JD and Alibaba reconcile, JD Logistics to launch on Taobao and Alipay to launch on JD.com (+/-)
NIO US: NIO Lowers Battery Swap Service Fees to Encourage Frequent Battery Swaps(-)


[Blue Lotus Daily]:BEKE US/BZ US/ATAT US/3690 HK/TCOM US/2618 HK/002352 CH/NIO US/XPEV US/1211 HK

<ul>
<li>MNSO US: MINISO Acquires 29.4% Stake in Yonghui Superstores for RMB6.3 Billion, Becoming Its Largest Shareholder(-)</li>
<li>BEKE US:Stimulus monetary policies bodes well for real estate and consumption(+)</li>
<li>BEKE US:Chongqing Agency Decco Real Estate Joins Beike, Bodes Well for Market Share Gains(+)</li>
</ul>


MNSO US: MINISO Acquires 29.4% Stake in Yonghui Superstores for RMB6.3 Billion, Becoming Its Largest Shareholder(-)
BEKE US:Stimulus monetary policies bodes well for real estate and consumption(+)
BEKE US:Chongqing Agency Decco Real Estate Joins Beike, Bodes Well for Market Share Gains(+)


[Blue Lotus Daily]:MNSO US/BEKE US/LKNCY US/XPEV US / LI US/ NIO US/1211 HK/NIO US /1810 HK/

China

KE Holdings Inc. operates as an integrated online and offline platform for housing transactions and services. The Company offers existing and new home sales, home rentals, home renovation, real estate financial solutions, and other services. KE Holdings conducts businesses in China.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
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KE Holdings (BEKE US)

Here Is a Trillion Rmb Stimulus

MOHURD planned urban village renovations with monetized resettlement valued at RMB500bn-RMB1tn, could drive up property transaction value by 3%...

Blue Lotus Research Institute

What Is Chinese Government Waiting for to Stimulate Its Economy?

Chinese economy needs stimulus but it's not happening due to US rate and election uncertainties. Debt swap and reserve injection are getting...

Blue Lotus Research Institute

WisdomTree Emerging Markets Ex-State-Owned Enterprises Index Rebalance: US$300m Round-Trip Trade

There are 154 adds/80 deletes for the WisdomTree Emerging Markets ex-State-Owned Enterprises Index. Round-trip trade is US$300m. There have been...

Brian Freitas

[Blue Lotus Daily]:BEKE US/BZ US/ATAT US/3690 HK/TCOM US/2618 HK/002352 CH/NIO US/XPEV US/1211 HK

Chinese companies discuss economic topics, JD and Alibaba reconcile for cross-platform launches, NIO lowers battery swap fees.

Blue Lotus Research Institute

[Blue Lotus Daily]:MNSO US/BEKE US/LKNCY US/XPEV US / LI US/ NIO US/1211 HK/NIO US /1810 HK/

MINISO acquires majority stake in Yonghui Superstores, Beike benefits from stimulus policies and market share gains with Decco Real Estate...

Blue Lotus Research Institute

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Here Is a Trillion Rmb Stimulus

​MOHURD planned urban village renovations with monetized resettlement valued at RMB500bn-RMB1tn, could drive up property transaction value by 3%...

Blue Lotus Research Institute

What Is Chinese Government Waiting for to Stimulate Its Economy?

​Chinese economy needs stimulus but it's not happening due to US rate and election uncertainties. Debt swap and reserve injection are getting...

Blue Lotus Research Institute

WisdomTree Emerging Markets Ex-State-Owned Enterprises Index Rebalance: US$300m Round-Trip Trade

There are 154 adds/80 deletes for the WisdomTree Emerging Markets ex-State-Owned Enterprises Index. Round-trip trade is US$300m. There have been...

Brian Freitas

[Blue Lotus Daily]:BEKE US/BZ US/ATAT US/3690 HK/TCOM US/2618 HK/002352 CH/NIO US/XPEV US/1211 HK

​Chinese companies discuss economic topics, JD and Alibaba reconcile for cross-platform launches, NIO lowers battery swap fees.

Blue Lotus Research Institute

[Blue Lotus Daily]:MNSO US/BEKE US/LKNCY US/XPEV US / LI US/ NIO US/1211 HK/NIO US /1810 HK/

​MINISO acquires majority stake in Yonghui Superstores, Beike benefits from stimulus policies and market share gains with Decco Real Estate...

Blue Lotus Research Institute

MOHURD planned urban village renovations with monetized resettlement valued at RMB500bn-RMB1tn, could drive up property transaction value by 3%...

Chinese economy needs stimulus but it's not happening due to US rate and election uncertainties. Debt swap and reserve injection are getting...

Chinese companies discuss economic topics, JD and Alibaba reconcile for cross-platform launches, NIO lowers battery swap fees.

MINISO acquires majority stake in Yonghui Superstores, Beike benefits from stimulus policies and market share gains with Decco Real Estate...