Equity Analyst

Steve Zhou, CFA

Equity Bottom-Up

<ul>
<li>According to public news today afternoon during trading hours, the founder and biggest shareholder of <a href="https://www.smartkarma.com/entities/li-ning-co-ltd" target="_blank" data-smartkarma-citation="entities:6047:1" rel="noopener">Li Ning (2331 HK)</a>, Mr. Li Ning, is mulling privatizing the public company. </li>
<li>Mr. Li Ning has shown the opposite intention over the last few years, with several major sell-down of stake.</li>
<li>The company is trading at 16x 2024 PE, with visibility being quite low.  </li>
</ul>


According to public news today afternoon during trading hours, the founder and biggest shareholder of Li Ning (2331 HK), Mr. Li Ning, is mulling privatizing the public company. 
Mr. Li Ning has shown the opposite intention over the last few years, with several major sell-down of stake.
The company is trading at 16x 2024 PE, with visibility being quite low.  


Li Ning (2331 HK):  Update On The Name Given Potential Privatization News

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>Reuters <a href="https://www.reuters.com/markets/asia/chinas-champion-gymnast-li-ning-considers-taking-company-private-sources-say-2024-03-12/" target="_blank" rel="noopener">reported</a> that due to the steep share price declines, Mr Li Ning is considering leading a consortium to privatise <a href="https://www.smartkarma.com/entities/li-ning-co-ltd" target="_blank" data-smartkarma-citation="entities:6047:1" rel="noopener">Li Ning (2331 HK)</a>. </li>
<li>The shares have been weighed down by concerns about channel inventory, steep retail discounts, and unauthorised distributor sales. To counter this, Li Ning aims to achieve RMB50bn sales by 2028.</li>
<li>The probability of an offer is low as funding the scheme consideration could prove challenging. Nevertheless, the downside is low as Li Ning trades at an undemanding valuation. </li>
</ul>


Reuters reported that due to the steep share price declines, Mr Li Ning is considering leading a consortium to privatise Li Ning (2331 HK). 
The shares have been weighed down by concerns about channel inventory, steep retail discounts, and unauthorised distributor sales. To counter this, Li Ning aims to achieve RMB50bn sales by 2028.
The probability of an offer is low as funding the scheme consideration could prove challenging. Nevertheless, the downside is low as Li Ning trades at an undemanding valuation. 


Li Ning (2331 HK): Evaluating a Potential Privatisation

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>As the Hong Kong bourse languishes, recent Hong Kong privatisation include mainland Chinese firms such as <a href="https://www.smartkarma.com/entities/vinda-international-holdings-limited" target="_blank" data-smartkarma-citation="entities:475:1" rel="noopener">Vinda International (3331 HK)</a> and <a href="https://www.smartkarma.com/entities/china-traditional-chinese-medicine" target="_blank" data-smartkarma-citation="entities:351:1" rel="noopener">China Traditional Chinese Medicine (570 HK)</a> . </li>
<li>Reportedly (Reuters) <a href="https://www.smartkarma.com/entities/li-ning-co-ltd" target="_blank" data-smartkarma-citation="entities:6047:1" rel="noopener">Li Ning (2331 HK)</a> is now in the crosshairs.  Shares are up 7.8% as I type.</li>
<li>Olympic champion Li Ning holds ~10.5% in his self-named company, which was recently in the news after acquiring a HK$2.2bn commercial building from <a href="https://www.smartkarma.com/entities/henderson-land-development-co" target="_blank" data-smartkarma-citation="entities:376:1" rel="noopener">Henderson Land (12 HK) </a> as its headquarters.</li>
</ul>


As the Hong Kong bourse languishes, recent Hong Kong privatisation include mainland Chinese firms such as Vinda International (3331 HK) and China Traditional Chinese Medicine (570 HK) . 
Reportedly (Reuters) Li Ning (2331 HK) is now in the crosshairs.  Shares are up 7.8% as I type.
Olympic champion Li Ning holds ~10.5% in his self-named company, which was recently in the news after acquiring a HK$2.2bn commercial building from Henderson Land (12 HK)  as its headquarters.


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

<ul>
<li>
<a href="https://www.smartkarma.com/entities/giant-biogene-holding-co-ltd" target="_blank" data-smartkarma-citation="entities:35950:1" rel="noopener">Giant Biogene (2367 HK)</a> aims to raise up to US$205m via a top-up placement.</li>
<li>We have followed the company since listing and its recent performance has been great. Although it doesn’t seem to need the cash.</li>
<li>In this note, we will run the deal through our ECM framework and talk about the recent updates.</li>
</ul>



Giant Biogene (2367 HK) aims to raise up to US$205m via a top-up placement.
We have followed the company since listing and its recent performance has been great. Although it doesn’t seem to need the cash.
In this note, we will run the deal through our ECM framework and talk about the recent updates.


Giant Biogene Placement - Has Been Doing Well but Doesn’t Need the Cash

<ul>
<li>The data in this insight is collated from the "shareholding disclosure" link on the HKEx website</li>
<li>Often there is a corresponding HKEx announcement on the increase - or decrease - in the shareholding by directors. Or pledging. However, such disclosures are by no means an absolute.</li>
<li>The key stocks mentioned in this regular insight is <a href="https://www.smartkarma.com/entities/li-ning-co-ltd" target="_blank" data-smartkarma-citation="entities:6047:1" rel="noopener">Li Ning (2331 HK)</a> and <a href="https://www.smartkarma.com/entities/meitu-inc" target="_blank" data-smartkarma-citation="entities:23573:1" rel="noopener">Meitu Inc (1357 HK)</a>.</li>
</ul>


The data in this insight is collated from the "shareholding disclosure" link on the HKEx website
Often there is a corresponding HKEx announcement on the increase - or decrease - in the shareholding by directors. Or pledging. However, such disclosures are by no means an absolute.
The key stocks mentioned in this regular insight is Li Ning (2331 HK) and Meitu Inc (1357 HK).


HK CEO & Director Dealings (29 Dec 2023): Li Ning, Meitu

China

Li Ning Company Limited researches, designs, manufactures, distributes, and retails sports footwear, apparel and accessories for sport and leisure use.

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Li Ning (2331 HK)

Li Ning (2331 HK): Update On The Name Given Potential Privatization News

FY2023 results out last week, which showed net profit down 22% yoy in 2023 (-43% yoy in 2H23), and sales up 7% yoy (+1% yoy in 2H23). The company...

Steve Zhou, CFA

Li Ning (2331 HK): Evaluating a Potential Privatisation

The probability of an offer is low as funding the scheme consideration could prove challenging. Nevertheless, the downside is low as Li Ning trades...

Arun George

Li Ning (2331 HK): Value Trap Play?

IF you are an arbitrageur, I might dip my toe in here. IF you are a long only investor, I'd probably be buying around here. But neither are strong...

David Blennerhassett

Giant Biogene Placement - Has Been Doing Well but Doesn’t Need the Cash

Giant Biogene (2367 HK) aims to raise up to US$205m via a top-up placement. In this note, we talk about the deal dynamics and run the deal through...

Sumeet Singh

HK CEO & Director Dealings (29 Dec 2023): Li Ning, Meitu

The data in this insight is collated from the "shareholding disclosure" link on the HKEx website. These insights also flag those companies where...

David Blennerhassett

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