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Articles from Caixin Global

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Cross Asset Strategy

<ul><li>Analysis: China’s new electricity spot market rules lay groundwork for unified standard</li><li>Tornadoes / Tornadoes kill 10 in coastal Chinese province</li><li>Shenzhen looks to attract more Hong Kong, Macao visitors — and their cash</li></ul>

Analysis: China’s new electricity spot market rules lay groundwork for unified standardTornadoes / Tornadoes kill 10 in coastal Chinese provinceShenzhen looks to attract more Hong Kong, Macao visitors — and their cash

CX Daily: China’s New Electricity Spot Market Rules Lay Groundwork for Unified Standard

Analyst

Steve

Equity Capital Markets

Midea Group Co Ltd A / Equity Capital Markets

<ul>
<li>Midea Group Co Ltd A (000333 CH) announced on September 18 the approval for H-share listing for a total of not more than 10% of its outstanding shares (before overallotment).</li>
<li>Reasons for the listing include the possible share incentive program for overseas employees and more exposure to foreign investors. </li>
<li>The H-share listing could be a safe bet given the current valuation profile, especially if the discount to A-share is larger than 10%. </li>
</ul>


Midea Group Co Ltd A (000333 CH) announced on September 18 the approval for H-share listing for a total of not more than 10% of its outstanding shares (before overallotment).
Reasons for the listing include the possible share incentive program for overseas employees and more exposure to foreign investors. 
The H-share listing could be a safe bet given the current valuation profile, especially if the discount to A-share is larger than 10%. 


Midea Group (000333 CH):  Potential H-Share Listing Thoughts

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

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/midea-group-co-ltd-a" target="_blank" data-smartkarma-citation="entities:16185:1" rel="noopener">Midea Group Co Ltd A (000333 CH)</a> could raise between HK$35-54bn (US$4.5-6.9bn) in its H-share listing depending on the H-shares discount and exercise of the overallotment option.</li>
<li>The H-shares could get Fast Entry to some global indices depending on the number of shares that are allotted to cornerstone and/or strategic investors.</li>
<li>The H-shares will be added to Southbound Stock Connect following the end of the price stabilisation period. Inclusion in the Hang Seng Composite Index will come later.</li>
</ul>



Midea Group Co Ltd A (000333 CH) could raise between HK$35-54bn (US$4.5-6.9bn) in its H-share listing depending on the H-shares discount and exercise of the overallotment option.
The H-shares could get Fast Entry to some global indices depending on the number of shares that are allotted to cornerstone and/or strategic investors.
The H-shares will be added to Southbound Stock Connect following the end of the price stabilisation period. Inclusion in the Hang Seng Composite Index will come later.


Midea Group (000333 CH): H-Share Listing & Index Implications

HK/China Equity Long-Short

Osbert Tang, CFA

Equity Bottom-Up

<ul>
<li>The weak share price of <a href="https://www.smartkarma.com/entities/haier-smart-home-co-ltd-b3ef445f-0f54-4586-8c58-9073de98d60e" target="_blank" data-smartkarma-citation="entities:31105:1" rel="noopener">Haier Smart Home (6690 HK)</a> looks unjustified given its healthy 1H23 result and solid financial position with net cash equals 11% of share price. </li>
<li>We anticipate product advancement and innovation will allow HSH to gain more market share. Its high-end brand Casarte will sustain as an important driver for earnings performance.</li>
<li>Gross margin looks to have room to expand due to better cost dynamics with digitalisation and AI initiatives. Continued growth in developing overseas market is also positive. </li>
</ul>


The weak share price of Haier Smart Home (6690 HK) looks unjustified given its healthy 1H23 result and solid financial position with net cash equals 11% of share price. 
We anticipate product advancement and innovation will allow HSH to gain more market share. Its high-end brand Casarte will sustain as an important driver for earnings performance.
Gross margin looks to have room to expand due to better cost dynamics with digitalisation and AI initiatives. Continued growth in developing overseas market is also positive. 


Haier Smart Home (6690 HK): Healthy Growth Despite Challenges

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 monthly Shanghai/Shenzhen northbound Connect flows with our data engine.</li>
<li>We estimate the outflows to be $12.8bn in August and consumer staples, and financials sectors led the outflows.</li>
<li>We highlight flows for CATL, Wuxi Wapptec, Fuyao Glass, Foxconn Industrial, CMB, Wuliangye, Mindray, Moutai, Longi Green.</li>
</ul>


We analyze the monthly Shanghai/Shenzhen northbound Connect flows with our data engine.
We estimate the outflows to be $12.8bn in August and consumer staples, and financials sectors led the outflows.
We highlight flows for CATL, Wuxi Wapptec, Fuyao Glass, Foxconn Industrial, CMB, Wuliangye, Mindray, Moutai, Longi Green.


Northbound Flows Monthly (August): $12.8bn Outflows

China

Midea Group CO., LTD manufactures, markets and installs household electrical appliances, compressors and components. Midea also provides services in information technology, corporate investment consultation, software and hardware development, property management and corporate engineering supports. Midea Group provides its products worldwide.

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Midea Group Co Ltd A (000333 CH)

CX Daily: China’s New Electricity Spot Market Rules Lay Groundwork for Unified Standard

Analysis: China’s new electricity spot market rules lay groundwork for unified standard. Tornadoes kill 10 in coastal Chinese province...

Caixin Global

Haier Smart Home (6690 HK): Healthy Growth Despite Challenges

Weak share price seems unwarranted despite strong 1H23 results and solid financial position. Market share growth, high-end brand sustainability,...

Osbert Tang, CFA

Northbound Flows Monthly (August): $12.8bn Outflows

We analyzed the Shanghai/Shenzhen Connect Scheme for August and highlight flows for CATL, Wuxi Wapptec, Fuyao Glass, Foxconn Industrial, CMB,...

Ke Yan, CFA, FRM

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

CX Daily: China’s New Electricity Spot Market Rules Lay Groundwork for Unified Standard

Analysis: China’s new electricity spot market rules lay groundwork for unified standard. Tornadoes kill 10 in coastal Chinese province...

Caixin Global

Midea Group (000333 CH): Potential H-Share Listing Thoughts

Thoughts on the potential H-share listing for Midea Group (000333 CH): could be a good pick up given the current valuation profile especially if A...

Steve

Midea Group (000333 CH): H-Share Listing & Index Implications

Midea Group could raise between HK$35-47bn in its H-shares listing. The discount vs A-shares and cornerstone/strategic allocation will be key in...

Brian Freitas

Haier Smart Home (6690 HK): Healthy Growth Despite Challenges

Weak share price seems unwarranted despite strong 1H23 results and solid financial position. Market share growth, high-end brand sustainability,...

Osbert Tang, CFA

Northbound Flows Monthly (August): $12.8bn Outflows

We analyzed the Shanghai/Shenzhen Connect Scheme for August and highlight flows for CATL, Wuxi Wapptec, Fuyao Glass, Foxconn Industrial, CMB,...

Ke Yan, CFA, FRM