Asian Insight Provider - Actionable ideas, CrossASEAN Research

Henry Soediarko

Asian Insight Provider - Actionable ideas

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

Equity Bottom-Up

Crowds at the workplace have started to come back, and vaccination centers are empty, both indicating that the vaccination drive has reached its peak and while outbreak cases are springing up, the Multi Ministry Task Force of the Singapore government has not issued a cautious note for a lockdown again or preference to work-from-home. 
At SGD 1.6/share, Comfortdelgro's share price is still 20% away from the lows in 2018 and 37% away from the pre-COVID-19 level. The recent earnings indicated that it has reached slightly more than 50% of the pre-COVID-19 level and with the reopening on scheduled, it is almost certain that the company's net earnings can go back to the pre-COVID-19 level. The bigger question is when- will it be another quarter or another half year?
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For the long term, bargain hunters long-term investors, and at the risk of sounding like a broken record, <a href="https://www.smartkarma.com/entities/comfortdelgro-corp-ltd" target="_blank" data-smartkarma-citation="entities:497:1" rel="noopener">Comfortdelgro Corp (CD SP)</a> provides the best exposure for ground transport reopening theme especially when Singapore's vaccination rate is one of the highest globally. 
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Crowds at the workplace have started to come back, and vaccination centers are empty, both indicating that the vaccination drive has reached its peak and while outbreak cases are springing up, the Multi Ministry Task Force of the Singapore government has not issued a cautious note for a lockdown again or preference to work-from-home. 
At SGD 1.6/share, Comfortdelgro's share price is still 20% away from the lows in 2018 and 37% away from the pre-COVID-19 level. The recent earnings indicated that it has reached slightly more than 50% of the pre-COVID-19 level and with the reopening on scheduled, it is almost certain that the company's net earnings can go back to the pre-COVID-19 level. The bigger question is when- will it be another quarter or another half year?

For the long term, bargain hunters long-term investors, and at the risk of sounding like a broken record, Comfortdelgro Corp (CD SP) provides the best exposure for ground transport reopening theme especially when Singapore's vaccination rate is one of the highest globally. 


Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Event-Driven

End of the Lock-Up Period (6 Months) - The six months lock-up period for the SK Bioscience comes up in one month on September 18th. There are 2.2 million shares that could be sold once the three months lock-up period ends on September 18th, which represents 2.9% of total outstanding shares. <a href="https://www.smartkarma.com/entities/sk-bioscience-co-ltd" target="_blank" data-smartkarma-citation="entities:31484:1" rel="noopener">SK Bioscience (302440 KS)</a> has been one of the best performing stocks in Korea this year. Since its IPO on 18 March 2021, the stock price is up 393%. The stock has especially been very hot in the past month as its stock price is up 103% in this period. Despite the sharp share price appreciation, the six months lockup period is ending in one month. As more investors see the locked up shares potentially coming out into the market, this could cause some negative pressure on the stock. There has been a big re-spread of COVID-19 in South Korea this year. This has been one of the key positive factors impacting SK Bioscience. Unlike many countries that have been able to reduce the number of COVID-19 cases, South Korea has been the reverse with the total number of cases increasing rapidly this year. The number of daily cases of COVID-19 reached all-time high on 11 August when it reached 2,219 cases in South Korea.

End of the Lock-Up Period (6 Months) - The six months lock-up period for the SK Bioscience comes up in one month on September 18th. There are 2.2 million shares that could be sold once the three months lock-up period ends on September 18th, which represents 2.9% of total outstanding shares. SK Bioscience (302440 KS) has been one of the best performing stocks in Korea this year. Since its IPO on 18 March 2021, the stock price is up 393%. The stock has especially been very hot in the past month as its stock price is up 103% in this period. Despite the sharp share price appreciation, the six months lockup period is ending in one month. As more investors see the locked up shares potentially coming out into the market, this could cause some negative pressure on the stock. There has been a big re-spread of COVID-19 in South Korea this year. This has been one of the key positive factors impacting SK Bioscience. Unlike many countries that have been able to reduce the number of COVID-19 cases, South Korea has been the reverse with the total number of cases increasing rapidly this year. The number of daily cases of COVID-19 reached all-time high on 11 August when it reached 2,219 cases in South Korea.

SK Bioscience: Stock Price Up 393% Since IPO & 6 Months Lockup Period Ending in 1 Month

We aggregate key quotes from earnings, The Transcript

The Transcript

We aggregate key quotes from earnings

Aggregate Key Quotes from Earnings

Thematic (Sector/Industry)

The economy is booming and everyone should enjoy it. The American economy is benefitting from tremendous amounts of pent-up demand and in some of the hardest-hit industries' activity is beginning to tick back up above 2019 levels. Along with that boom, there are clear signs of inflation and concerns about overheating. Even Janet Yellen seemed concerned for a few hours last week.

The economy is booming and everyone should enjoy it. The American economy is benefitting from tremendous amounts of pent-up demand and in some of the hardest-hit industries' activity is beginning to tick back up above 2019 levels. Along with that boom, there are clear signs of inflation and concerns about overheating. Even Janet Yellen seemed concerned for a few hours last week.

Equity Capital Markets

<ul>
<li>SK Bioscience announced an excellent IPO book building results on 8 March. The IPO price has been confirmed at 65,000 won per share, which is at the top of the IPO price range. At the IPO price of 65,000 won, the company's initial market cap will be 5.0 trillion won.</li>
<li>The total demand ratio of the SK Bioscience IPO was 1,275.5 to 1, which is very high. Of these institutional investors, 96.7% of them thought that the value of the company should be 65,000 won or more. Our base case valuation for the company is a market cap of 11.5 trillion won or 149,000 won per share, which would represent a 129% upside from the IPO price of 65,000 won. </li>
<li>Despite the numerous positives about the SK Bioscience IPO, the biggest near-term and long-term problem of SK Bioscience is whether or not the COVID-19 vaccines of AstraZeneca, NovaVax, and other major global vaccine developers are safe or not.  Since 26 February (when COVID-19 vaccinations started in Korea), there have been <a href="https://blog.naver.com/jijisjungle/222264180891" target="_blank" rel="noopener">11 people</a> that have died in Korea after taking the AstraZeneca COVID-19 vaccines (death rate of 0.003%). For now, the Korean authorities have ruled out any association that may link the deaths of these 11 people with the COVID-19 vaccines.</li>
</ul>


SK Bioscience announced an excellent IPO book building results on 8 March. The IPO price has been confirmed at 65,000 won per share, which is at the top of the IPO price range. At the IPO price of 65,000 won, the company's initial market cap will be 5.0 trillion won.
The total demand ratio of the SK Bioscience IPO was 1,275.5 to 1, which is very high. Of these institutional investors, 96.7% of them thought that the value of the company should be 65,000 won or more. Our base case valuation for the company is a market cap of 11.5 trillion won or 149,000 won per share, which would represent a 129% upside from the IPO price of 65,000 won. 
Despite the numerous positives about the SK Bioscience IPO, the biggest near-term and long-term problem of SK Bioscience is whether or not the COVID-19 vaccines of AstraZeneca, NovaVax, and other major global vaccine developers are safe or not.  Since 26 February (when COVID-19 vaccinations started in Korea), there have been 11 people that have died in Korea after taking the AstraZeneca COVID-19 vaccines (death rate of 0.003%). For now, the Korean authorities have ruled out any association that may link the deaths of these 11 people with the COVID-19 vaccines.


Trading Strategy of SK Bioscience IPO Post Pricing

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

1. Industry viewpoints: <ul>
<li>For a long time, the National Healthcare Security Administration has explicitly mentioned to include the traditional Chinese medicines into volume-based purchase (VBP) and the related policy is now in process.</li>
<li>Vaccine is a hot topic in 2020, so it deserves further discussion.</li>
<li>In terms of future trend, the IVD industry will undergo profound changes in the next five years.</li>
</ul>2. Company news:News about the new agreement and the progress of new drugs from <a href="https://www.smartkarma.com/entities/ascentage-pharma-group-inter" target="_blank" data-smartkarma-citation="entities:27824:1" rel="noopener">Ascentage Pharma Group Corp (6855 HK)</a>, <a href="https://www.smartkarma.com/entities/cspc-pharmaceutical-group-ltd" target="_blank" data-smartkarma-citation="entities:229:1" rel="noopener">CSPC Pharmaceutical Group (1093 HK)</a>, <a href="https://www.smartkarma.com/entities/ascletis-pharma-inc" target="_blank" data-smartkarma-citation="entities:27265:1" rel="noopener">Ascletis Pharma Inc (1672 HK)</a>, and <a href="https://www.smartkarma.com/entities/antengene-corporation-limited" target="_blank" data-smartkarma-citation="entities:29705:1" rel="noopener">Antengene (6996 HK).</a>3. Market review:Last week, stock price for healthcare sector in A share increased 5.98%, while CSI 300 increased 1.71% over the same period of time.4. Risk Disclosure:Policy risk, R&amp;D risk, Company risk and COVID-19 risk.

1. Industry viewpoints: 
For a long time, the National Healthcare Security Administration has explicitly mentioned to include the traditional Chinese medicines into volume-based purchase (VBP) and the related policy is now in process.
Vaccine is a hot topic in 2020, so it deserves further discussion.
In terms of future trend, the IVD industry will undergo profound changes in the next five years.
2. Company news:News about the new agreement and the progress of new drugs from Ascentage Pharma Group Corp (6855 HK), CSPC Pharmaceutical Group (1093 HK), Ascletis Pharma Inc (1672 HK), and Antengene (6996 HK).3. Market review:Last week, stock price for healthcare sector in A share increased 5.98%, while CSI 300 increased 1.71% over the same period of time.4. Risk Disclosure:Policy risk, R&amp;D risk, Company risk and COVID-19 risk.

United States

Moderna, Inc. operates as a biotechnology company. The Company focuses on the discovery and development of messenger RNA therapeutics and vaccines. Moderna develops mRNA medicines for infectious, immuno-oncology, and cardiovascular diseases.

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Moderna (MRNA US)

Comfortdelgro (CD): On-The-Ground Survey

it is almost certain that the company's net earnings can go back to pre-COVID-19 level; the question is when? Will it take another quarter or...

Henry Soediarko

SK Bioscience: Stock Price Up 393% Since IPO & 6 Months Lockup Period Ending in 1 Month

The 6 months lock-up period for the SK Bioscience comes up in one month. As more investors see the locked up shares coming out into the market,...

Douglas Kim

The Transcript 05.10.21: Pent-up Demand

The economy is booming and everyone should enjoy it. The American economy is benefitting from tremendous amounts of pent-up demand and in some of...

The Transcript

Trading Strategy of SK Bioscience IPO Post Pricing

The IPO price of SK Bioscience was confirmed at 65,000 won per share, which is at the top of the IPO price range. The total demand ratio of the SK...

Douglas Kim

China Healthcare Weekly (Dec.4)

This article summarized the updated news in China volume-based purchase policy, industry viewpoints, company news, and capital market review for...

Xinyao (Criss) Wang

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