Articles from Caixin Global, Caixin Global

Caixin Global

Articles from Caixin Global

Caixin is a media group dedicated to providing financial and business news through periodicals, online content, mobile apps, conferences, books and TV/video programs. Caixin aims to blaze a trail that helps traditional media prosper in the new media age through integrated multimedia platforms.

News from Caixin

Cross Asset Strategy

<ul><li>Covid-19 / China’s Covid caseload hits six-month high as big cities suffer flare-ups</li><li>APEC / China, Japan to move quickly on maritime and air security hotline</li><li>Caixin Summit / China’s growth is ‘too slow,' says top state economist</li></ul>

Covid-19 / China’s Covid caseload hits six-month high as big cities suffer flare-upsAPEC / China, Japan to move quickly on maritime and air security hotlineCaixin Summit / China’s growth is ‘too slow,' says top state economist

CX Daily: China’s Covid Caseload Hits Six-Month High As Big Cities Suffer Flare-Ups

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In Depth: Missfresh implosion highlights bitter business of selling groceries online
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Beijing sanctions more individuals in Taiwan in response to U.S. congressional visits
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Fugitive behind $15 billion Myanmar business hub arrested in Thailand
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In Depth: Missfresh implosion highlights bitter business of selling groceries online


Beijing sanctions more individuals in Taiwan in response to U.S. congressional visits


Fugitive behind $15 billion Myanmar business hub arrested in Thailand



CX Daily: Missfresh Implosion Highlights Bitter Business of Selling Groceries Online

<ul><li>In Depth: China doubles down on infrastructure to spur growth</li><li>Beijing’s top health official sacked for engaging in lucrative private lending</li><li>China’s top court makes it easier for domestic abuse victims to escape abusers</li></ul>

In Depth: China doubles down on infrastructure to spur growthBeijing’s top health official sacked for engaging in lucrative private lendingChina’s top court makes it easier for domestic abuse victims to escape abusers

CX Daily: China Doubles Down on Infrastructure to Spur Growth

Alpha-Centric ESG Research

Kyle Rudden

Well, that sure escalated quickly.Early last week, in the Insight <a href="https://www.smartkarma.com/insights/pre-ipo-esg-analysis-didi-s-exemplary-esg-achievements-eclipsed-by-regulatory-risks-and-uncertainty" target="_blank" data-smartkarma-citation="insights:53687" rel="noopener">Pre-IPO ESG Analysis: DiDi's Exemplary ESG Achievements Eclipsed By Regulatory Risks and Uncertainty</a>, I juxtaposed <a href="https://www.smartkarma.com/entities/didi-chuxing-inc" target="_blank" data-smartkarma-citation="entities:27467:1" rel="noopener">DiDi's (DIDI US)</a> relatively strong ESG results in areas under its control with serious concerns about regulatory risk outside of its direct control.Late last week, days after DiDi's successful US$4.4 billion initial public offering, Chinese regulators ordered the removal of DiDi's business-critical ride-hailing apps from online app markets, until the company rectifies "serious violations" pertaining to collection and use of customer data.DiDi is down 5.3% so far (delayed open today).Regulatory risk was central to my thesis in the first Insight. I hardly anticipated this, but I referred to regulatory risk as real, near-term, tangible investment risk; not just some fuzzy ESG risk. Given that, I felt obliged to follow up. At the same time, however, this news is covered ad nauseam.No sense in beating a dead horse with a broken record.So, I decided to do something different. That statement about regulatory risk being a real tangible investment risk is primarily based on anecdotal evidence – i.e., when regulators flex their muscle, stocks go down, not up. But "anecdotal" isn't good enough.Which is why I took this opportunity to quantify the impacts of adverse regulatory events in China. Specifically, with event studies measuring abnormal returns around major regulatory events across four broad categories. That's what most of this Insight is about. But back to DiDi for a moment.Regulatory risk and uncertainty for DiDi is much worse today than it was last week. Typically, the opposite would be true; a negative event out in the open is better than a possible event lurking in the shadows. But not this time. Barring an immediate change of heart by the PRC, this is bad.Therefore, downgrading to bearish.

Well, that sure escalated quickly.Early last week, in the Insight Pre-IPO ESG Analysis: DiDi's Exemplary ESG Achievements Eclipsed By Regulatory Risks and Uncertainty, I juxtaposed DiDi's (DIDI US) relatively strong ESG results in areas under its control with serious concerns about regulatory risk outside of its direct control.Late last week, days after DiDi's successful US$4.4 billion initial public offering, Chinese regulators ordered the removal of DiDi's business-critical ride-hailing apps from online app markets, until the company rectifies "serious violations" pertaining to collection and use of customer data.DiDi is down 5.3% so far (delayed open today).Regulatory risk was central to my thesis in the first Insight. I hardly anticipated this, but I referred to regulatory risk as real, near-term, tangible investment risk; not just some fuzzy ESG risk. Given that, I felt obliged to follow up. At the same time, however, this news is covered ad nauseam.No sense in beating a dead horse with a broken record.So, I decided to do something different. That statement about regulatory risk being a real tangible investment risk is primarily based on anecdotal evidence – i.e., when regulators flex their muscle, stocks go down, not up. But "anecdotal" isn't good enough.Which is why I took this opportunity to quantify the impacts of adverse regulatory events in China. Specifically, with event studies measuring abnormal returns around major regulatory events across four broad categories. That's what most of this Insight is about. But back to DiDi for a moment.Regulatory risk and uncertainty for DiDi is much worse today than it was last week. Typically, the opposite would be true; a negative event out in the open is better than a possible event lurking in the shadows. But not this time. Barring an immediate change of heart by the PRC, this is bad.Therefore, downgrading to bearish.

PRC Shows DiDi Who's Boss: An Analysis of Adverse Regulatory Events on Stock Prices

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Capital Markets

Xiaocaiyuan International Holding / Equity Capital Markets

Xiaocaiyuan International Holding (XCY HK)

<ul>
<li>Based on effective strategic positioning, Xiaocaiyuan is able to seize the market's demand for cost-effective catering during consumption downgrade and the trend of increasing restaurant chain rate in China.</li>
<li>The key for Xiaocaiyuan to generate increasing profits at low spending-per-consumer is due to its strong supply chain, which will be favored by capital especially when Xiaocaiyuan enters community catering.</li>
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<a href="https://www.smartkarma.com/entities/xiaocaiyuan-international-holding-ltd" target="_blank" data-smartkarma-citation="entities:40688:1" rel="noopener">Xiaocaiyuan International Holding (XCY HK)</a> is better than peers. However, due to poor sentiment in HKEX, it’s not sure if Xiaocaiyuan’s valuation/share price performance could outperform peers as well.</li>
</ul>


Based on effective strategic positioning, Xiaocaiyuan is able to seize the market's demand for cost-effective catering during consumption downgrade and the trend of increasing restaurant chain rate in China.
The key for Xiaocaiyuan to generate increasing profits at low spending-per-consumer is due to its strong supply chain, which will be favored by capital especially when Xiaocaiyuan enters community catering.

Xiaocaiyuan International Holding (XCY HK) is better than peers. However, due to poor sentiment in HKEX, it’s not sure if Xiaocaiyuan’s valuation/share price performance could outperform peers as well.


Pre-IPO Xiaocaiyuan International Holding - A "Dark Horse" In Mass Chinese Cuisine Market

China

Missfresh Limited is an e-commerce company. The Company offers an online platform that sells daily grocery products.

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Missfresh (MF US)

CX Daily: China’s Covid Caseload Hits Six-Month High As Big Cities Suffer Flare-Ups

China’s Covid caseload hits six-month high as big cities suffer flare-ups. China, Japan to move quickly on maritime and air security hotline

Caixin Global

CX Daily: Missfresh Implosion Highlights Bitter Business of Selling Groceries Online

In Depth: Missfresh implosion highlights bitter business of selling groceries online. Beijing sanctions more individuals in Taiwan in response to...

Caixin Global

CX Daily: China Doubles Down on Infrastructure to Spur Growth

In Depth: China doubles down on infrastructure to spur growth. Beijing’s top health official sacked for engaging in lucrative private lending

Caixin Global

PRC Shows DiDi Who's Boss: An Analysis of Adverse Regulatory Events on Stock Prices

Last week, I wrote about DiDi's regulatory risk. This week, it's worse. Hence the downgrade. But this is mostly an analysis of how regulatory...

Kyle Rudden

Pre-IPO Xiaocaiyuan International Holding - A "Dark Horse" In Mass Chinese Cuisine Market

Xiaocaiyuan’s supply chain advantage/development direction/strategic positioning is favored by capital. In terms of potential/fundamentals,...

Xinyao (Criss) Wang

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