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.

Event-Driven

<ul>
<li>PCAOB officials concluded their Hong Kong visit last month and PCAOB is due to announce its annual judgment on whether it had adequate access to US listed China companies.</li>
<li>The Hong Kong visit was on the back of the 26th Aug 2022 announcement by PCAOB and CSRC that they had entered into an agreement with US authorities for access.</li>
<li>In this note, we'll talk about the latest developments, possible outcomes and implications.</li>
</ul>


PCAOB officials concluded their Hong Kong visit last month and PCAOB is due to announce its annual judgment on whether it had adequate access to US listed China companies.
The Hong Kong visit was on the back of the 26th Aug 2022 announcement by PCAOB and CSRC that they had entered into an agreement with US authorities for access.
In this note, we'll talk about the latest developments, possible outcomes and implications.


China ADRs Delisting - Friday Could Be Judgment Day for over US$800bn Mcap of Stocks

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Douyu International Holdings / Event-Driven

<ul>
<li>In a particularly altruistic move, live-streaming game platform play <a href="https://www.smartkarma.com/entities/douyu-international-hold-adr" target="_blank" data-smartkarma-citation="entities:28045:1" rel="noopener">Douyu International Holdings (DOYU US)</a>  <a href="https://ir.douyu.com/2024-07-03-DouYu-International-Holdings-Limited-Announces-Special-Cash-Dividend" target="_blank" rel="noopener">announced</a> a special cash dividend of US$9.76/share, vs. a last price of US$12.59.</li>
<li>The cash outlay is roughly US$308mn, and Douyu had cash (as at 1Q24) of <a href="https://ir.douyu.com/2024-06-05-DouYu-International-Holdings-Limited-Reports-First-Quarter-2024-Unaudited-Financial-Results" target="_blank" rel="noopener">US$936.6mn</a>. And no debt.  Founder/chairman/CEO Shaojie Chen (17.2% shareholder) will pocket a tidy ~US$53mn.</li>
<li>An outlier; or should we expect more of the same for other cash-rich US-listed China plays?</li>
</ul>


In a particularly altruistic move, live-streaming game platform play Douyu International Holdings (DOYU US)  announced a special cash dividend of US$9.76/share, vs. a last price of US$12.59.
The cash outlay is roughly US$308mn, and Douyu had cash (as at 1Q24) of US$936.6mn. And no debt.  Founder/chairman/CEO Shaojie Chen (17.2% shareholder) will pocket a tidy ~US$53mn.
An outlier; or should we expect more of the same for other cash-rich US-listed China plays?


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 December rebalance of the <a href="https://www.smartkarma.com/entities/kraneshares-csi-china-internet-etf" target="_blank" data-smartkarma-citation="entities:28208:1" rel="noopener">KraneShares CSI China Internet ETF (KWEB US)</a> will take place at the close of trading on 13 December.</li>
<li>
<a href="https://www.smartkarma.com/entities/cloud-village-inc" target="_blank" data-smartkarma-citation="entities:33412:1" rel="noopener">Cloud Village (9899 HK)</a> is an add while <a href="https://www.smartkarma.com/entities/lufax-holding-ltd" target="_blank" data-smartkarma-citation="entities:29690:1" rel="noopener">Lufax Holding (LU US)</a>, <a href="https://www.smartkarma.com/entities/ping-an-healthcare-and-technology-company-limited" target="_blank" data-smartkarma-citation="entities:27008:1" rel="noopener">Ping An Healthcare and Technology (1833 HK)</a>, <a href="https://www.smartkarma.com/entities/zx-inc" target="_blank" data-smartkarma-citation="entities:36624:1" rel="noopener">ZX (9890 HK)</a> and <a href="https://www.smartkarma.com/entities/ysb-inc" target="_blank" data-smartkarma-citation="entities:35982:1" rel="noopener">YSB (9885 HK)</a> are deletes.</li>
<li>The deletions of <a href="https://www.smartkarma.com/entities/ping-an-healthcare-and-technology-company-limited" target="_blank" data-smartkarma-citation="entities:27008:1" rel="noopener">Ping An Healthcare (1833 HK)</a>, <a href="https://www.smartkarma.com/entities/zx-inc" target="_blank" data-smartkarma-citation="entities:36624:1" rel="noopener">ZX (9890 HK)</a> and <a href="https://www.smartkarma.com/entities/ysb-inc" target="_blank" data-smartkarma-citation="entities:35982:1" rel="noopener">YSB (9885 HK)</a> were forecast and there will be positioning in the stocks. <a href="https://www.smartkarma.com/entities/lufax-holding-ltd" target="_blank" data-smartkarma-citation="entities:29690:1" rel="noopener">Lufax</a> was a close delete.</li>
</ul>


The December rebalance of the KraneShares CSI China Internet ETF (KWEB US) will take place at the close of trading on 13 December.

Cloud Village (9899 HK) is an add while Lufax Holding (LU US), Ping An Healthcare and Technology (1833 HK), ZX (9890 HK) and YSB (9885 HK) are deletes.
The deletions of Ping An Healthcare (1833 HK), ZX (9890 HK) and YSB (9885 HK) were forecast and there will be positioning in the stocks. Lufax was a close delete.


KWEB Index Rebalance: 1 Add & 4 Deletes in December

Independent Research, Turtles all the way down

Turtles all the way down

Independent Research

Writing short articles about mis-priced boring stocks around the world.

Equity Bottom-Up

<ul>
<li>I am quite sick so I will keep it short.</li>
<li>I am closing Lufax (LU) here and would at least take something off the table for JD holdings (JD) </li>
<li>Honestly Lufax business is too much of a black box, and the forward PE multiple isn’t low enough anymore for my taste.</li>
</ul>


I am quite sick so I will keep it short.
I am closing Lufax (LU) here and would at least take something off the table for JD holdings (JD) 
Honestly Lufax business is too much of a black box, and the forward PE multiple isn’t low enough anymore for my taste.


Asian Hedge Fund Manager, Long Short Equity, Macro

David Mudd

<ul>
<li>ETF flows in the Asian region continued their positive momentum during August with Southbound Connect positive again for the week.</li>
<li>
<a href="https://www.smartkarma.com/entities/stella-international" target="_blank" data-smartkarma-citation="entities:7610:1" rel="noopener">Stella International (1836 HK)</a> will increase its dividends and buybacks after positive earnings surprise. <a href="https://www.smartkarma.com/entities/aia-group-ltd" target="_blank" data-smartkarma-citation="entities:14895:1" rel="noopener">AIA Group Ltd (1299 HK)</a> saw a surge in new policies from mainlanders in HK.
</li>
<li>
<a href="https://www.smartkarma.com/entities/lufax-holding-ltd-b751749a-8feb-4b4d-85a7-d99ac0308fe7" target="_blank" data-smartkarma-citation="entities:40067:1" rel="noopener">Lufax Holding (6623 HK)</a> reported an earnings miss with declining loan volume. <a href="https://www.smartkarma.com/entities/yancoal-australia" target="_blank" data-smartkarma-citation="entities:8427:1" rel="noopener">Yancoal Australia (3668 HK)</a> reported a decline of 57% in earnings which was below analysts' estimates.
</li>
</ul>


ETF flows in the Asian region continued their positive momentum during August with Southbound Connect positive again for the week.

Stella International (1836 HK) will increase its dividends and buybacks after positive earnings surprise. AIA Group Ltd (1299 HK) saw a surge in new policies from mainlanders in HK.


Lufax Holding (6623 HK) reported an earnings miss with declining loan volume. Yancoal Australia (3668 HK) reported a decline of 57% in earnings which was below analysts' estimates.



The Heat Is On: News Flow and Sentiment in CHINA / HONG KONG (August 26)

China

Lufax Holding Ltd operates technology-empowered personal financial services platform. The Company connects financial institutions to facilitate lending and wealth management products tailored to individual customer's needs and risk appetites.

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Lufax Holding (LU US)

China ADRs Delisting - Friday Could Be Judgment Day for over US$800bn Mcap of Stocks

PCAOB officials concluded their Hong Kong visit last month and PCAOB is due to announce its annual judgment on whether it had adequate access to US...

Sumeet Singh

Screening For The Next Douyu (DOYU US)

In an altruistic move, Douyu announced a special dividend of US$9.76/share, vs. a last price of US$12.59. An outlier; or should we expect more of...

David Blennerhassett

KWEB Index Rebalance: 1 Add & 4 Deletes in December

Cloud Village is an add while Lufax, Ping An Health, ZX and YSB are deletes. There will be capping flow for the large caps. Couple of surprises...

Brian Freitas

Chinese Animal Spirits

I am quite sick so I will keep it short. I am closing Lufax (LU) here and would at least take something off the table for JD holdings (JD) ....

Turtles all the way down

The Heat Is On: News Flow and Sentiment in CHINA / HONG KONG (August 26)

ETF flows were again led by China. Stella International reported a surge in earnings and AIA announced new policy growth exceeded expectations....

David Mudd

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