Asia Pac IPO & Placement Research, China biotech, Aequitas Research

Ke Yan, CFA, FRM

Asia Pac IPO & Placement Research, China biotech

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.

Quantitative Analysis

<ul>
<li>We analyze the weekly Shanghai/Shenzhen northbound Connect flows with our data engine for holding position as of April 14th.</li>
<li>We estimate the weekly inflows to be US$770.1 million, led by materials, industrials, utilities sectors, and offset by financials, consumer staples.</li>
<li>We highlight flows for Kweichow Moutai, Ping An Insurance, Wuxi Apptec.</li>
</ul>


We analyze the weekly Shanghai/Shenzhen northbound Connect flows with our data engine for holding position as of April 14th.
We estimate the weekly inflows to be US$770.1 million, led by materials, industrials, utilities sectors, and offset by financials, consumer staples.
We highlight flows for Kweichow Moutai, Ping An Insurance, Wuxi Apptec.


Northbound Flows (Apr 14th): Kweichow Moutai, Ping An Insurance, Wuxi Apptec

China/Asia TMT

Shawn Yang

China growth and global non-US Internet equities

Blue Lotus Research Institute

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

Equity Bottom-Up

<ul>
<li>SFH reported largely inline C4Q22 results with total revenue and net income slightly missed our est. by 1% and 4%. </li>
<li>However, into 2023, we suggest that the trend could reverse due to pricing pressure from eCommerce merchants and service upgrade of Tongda companies.</li>
<li>Maintain SELL and TP of RMB48 due to pricing pressure and diminishing service differentiation. </li>
</ul>


SFH reported largely inline C4Q22 results with total revenue and net income slightly missed our est. by 1% and 4%. 
However, into 2023, we suggest that the trend could reverse due to pricing pressure from eCommerce merchants and service upgrade of Tongda companies.
Maintain SELL and TP of RMB48 due to pricing pressure and diminishing service differentiation. 


[S.F. Holding (2352 SZ) Earning Review]: Facing Threat from Pricing and Peers’ Service Upgrade

Asian Equities Analyst, Logistics & Transport, Tracking Traffic

Daniel Hellberg

Asian Equities Analyst, Logistics & Transport

Tracking Traffic

Focusing on Asian logistics, transportation, and travel companies

Thematic (Sector/Industry)

<ul>
<li>Combined January-February express industry parcel volume was up just 4.6% Y/Y, and ASPs were down -1.8% Y/Y</li>
<li>Listed express companies' parcel volume and government-reported online tangible goods sales in the first two months of 2023 also both up a modest ~5% Y/Y</li>
<li>In a year when one express player hopes to list its shares, it's unclear who will be willing to concede market share. We expect price competition to intensify in 2023.</li>
</ul>


Combined January-February express industry parcel volume was up just 4.6% Y/Y, and ASPs were down -1.8% Y/Y
Listed express companies' parcel volume and government-reported online tangible goods sales in the first two months of 2023 also both up a modest ~5% Y/Y
In a year when one express player hopes to list its shares, it's unclear who will be willing to concede market share. We expect price competition to intensify in 2023.


TRACKING TRAFFIC: Chinese Express / No Signs of a Sharp Recovery in Jan-Feb Data

<ul>
<li>
<a href="https://www.smartkarma.com/entities/zto-express" target="_blank" data-smartkarma-citation="entities:23628:1" rel="noopener">ZTO Express (ZTO US)</a> met consensus Q422 EPS estimate despite a miss on Revenue</li>
<li>Management expects to exceed industry volume growth (around +10%) in 2023</li>
<li>Likely obstacles to a sharp earnings recovery are: ASP momentum, "new-old" competition, and a lack of demonstrated cost control</li>
</ul>



ZTO Express (ZTO US) met consensus Q422 EPS estimate despite a miss on Revenue
Management expects to exceed industry volume growth (around +10%) in 2023
Likely obstacles to a sharp earnings recovery are: ASP momentum, "new-old" competition, and a lack of demonstrated cost control


ZTO Express Q4/2022 Results & Guidance:  Moderate Growth in '23, but Also Obstacles

<ul>
<li>The pricing trend is expected to experience higher sequential decline 1) parcel pricing is at a high point; 2) alleviated cost pressure; 3) delivery companies try to capture parcel volume. </li>
<li>The collaboration with PDD’s Temu could provide J&amp;T a source of international order volume. For its potential IPO, J&amp;T’s overseas operation gives more room of imagination than its domestic business.</li>
<li>We downgrade SFH to SELL with TP of RMB48 due to Fengwang’s unpromising outlook .Our top pick of the Logistics sector remains ZTO. We are a buyer to JD logistics.</li>
</ul>


The pricing trend is expected to experience higher sequential decline 1) parcel pricing is at a high point; 2) alleviated cost pressure; 3) delivery companies try to capture parcel volume. 
The collaboration with PDD’s Temu could provide J&amp;T a source of international order volume. For its potential IPO, J&amp;T’s overseas operation gives more room of imagination than its domestic business.
We downgrade SFH to SELL with TP of RMB48 due to Fengwang’s unpromising outlook .Our top pick of the Logistics sector remains ZTO. We are a buyer to JD logistics.


China Logistics Sector Update & Downgrade S.F. Holding (2352.CH) To SELL: Pricing Pressure in 1H

China

S.F. Holding Co., Ltd operates as a holding company. The Company, through its subsidiaries, provides logistics, order tracking, supply chain management, and warehousing services. S.F. Holding operates worldwide.

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S.F. Holding (002352 CH)

Northbound Flows (Apr 14th): Kweichow Moutai, Ping An Insurance, Wuxi Apptec

We analyzed northbound Shanghai/Shenzhen connect flows in the past week and highlight flows for Kweichow Moutai, Ping An Insurance, Wuxi Apptec.

Ke Yan, CFA, FRM

[S.F. Holding (2352 SZ) Earning Review]: Facing Threat from Pricing and Peers’ Service Upgrade

There will still be pricing pressure from eCommerce merchants and service upgrade of Tongda companies. Maintain SELL and TP of RMB48 due to pricing...

Blue Lotus Research Institute

TRACKING TRAFFIC: Chinese Express / No Signs of a Sharp Recovery in Jan-Feb Data

So far in 2023, parcel volume has recovered only moderately. We believe the industry may again see price deterioration after a brief respite in 2022.

Tracking Traffic

ZTO Express Q4/2022 Results & Guidance: Moderate Growth in '23, but Also Obstacles

ZTO guides strong volume growth and potentially better unit economics in '23, but we expect price pressure to return, and the company needs to rein...

Daniel Hellberg

China Logistics Sector Update & Downgrade S.F. Holding (2352.CH) To SELL: Pricing Pressure in 1H

We downgrade S.F. Holding to SELL due to Fengwang’s unpromising outlook under competitive pricing environment. Our top pick of the Logistics sector...

Blue Lotus Research Institute

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