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

Thematic (Sector/Industry)

<ul>
<li>NTES: Justice Mobile launches 2nd round of closed beta test (-)</li>
<li>PDD: PDD announces RMB 4bn in subsidies for annual May 5th Shopping Festival (+)</li>
<li>LKNCY/2150HK/ATAT: Labor Day holiday Tourism consumption recovered to pre-covid level in labor day holiday, and catering sector is leading the retail recovery trend.(+)</li>
</ul>


NTES: Justice Mobile launches 2nd round of closed beta test (-)
PDD: PDD announces RMB 4bn in subsidies for annual May 5th Shopping Festival (+)
LKNCY/2150HK/ATAT: Labor Day holiday Tourism consumption recovered to pre-covid level in labor day holiday, and catering sector is leading the retail recovery trend.(+)


China TMT Update (May 5-Pt1): NTES/PDD/LKNCY/2150HK/ATAT：Justice Mobile Launches 2nd Round Test

<ul>
<li>3690.HK: Meituan food delivery drivers in Shanwei go on strike over low wages (-)</li>
<li>2150HK: Lelecha confirm to launch franchise model, targeting at Mid and South-west China(+)</li>
<li>700 HK / TME : WeChat tests in-app music function(+)</li>
</ul>


3690.HK: Meituan food delivery drivers in Shanwei go on strike over low wages (-)
2150HK: Lelecha confirm to launch franchise model, targeting at Mid and South-west China(+)
700 HK / TME : WeChat tests in-app music function(+)


China TMT Update(Apr.25) - 3690.HK/2150.HK/700.HK/TME: Meituan Riders in Shanwei Go on Strike

Equity Bottom-Up

<ul>
<li>Nayuki reported C2H22 top line 0.9% below our estimate but 18% below consensus，due to deteriorating cost ratios; </li>
<li>Company chose to drastically expand store count by ~600 in 2023. Our concern is that Nayuki stores now are drastically different from its past.</li>
<li>The company is abandoning its premium teahouse position, which begets unknown consequences in our opinion; We keep the TP unchanged at HK 3.1 and maintain SELL.</li>
</ul>


Nayuki reported C2H22 top line 0.9% below our estimate but 18% below consensus，due to deteriorating cost ratios; 
Company chose to drastically expand store count by ~600 in 2023. Our concern is that Nayuki stores now are drastically different from its past.
The company is abandoning its premium teahouse position, which begets unknown consequences in our opinion; We keep the TP unchanged at HK 3.1 and maintain SELL.


[Nayuki Holding (2150 HK) Target Price Change]: Business Model Change Has Risky Consequence

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 Hong Kong Connect flows with our data engine for holding position as of March 24th.</li>
<li>The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.</li>
<li>We estimate that the total inflows were USD3.3bn last week and highlight flows for Meituan, Tencent, Bilibili.</li>
</ul>


We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of March 24th.
The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.
We estimate that the total inflows were USD3.3bn last week and highlight flows for Meituan, Tencent, Bilibili.


Hong Kong Connect Flows (Mar 24th): Meituan, Tencent, Bilibili

<ul>
<li>Even though we are long-term optimistic on the rise of Chinese consumer brands, we believe short-term optimism is misplaced. </li>
<li>Two themes: (1) structural changes led by China’s transition to an older and more affluent society, (2) substitution and globalization that can break the ceiling for valuation;</li>
<li>Our TOP PICKS are Li Auto, Atour, Luckin, FUTU, BEKE and Miniso</li>
</ul>


Even though we are long-term optimistic on the rise of Chinese consumer brands, we believe short-term optimism is misplaced. 
Two themes: (1) structural changes led by China’s transition to an older and more affluent society, (2) substitution and globalization that can break the ceiling for valuation;
Our TOP PICKS are Li Auto, Atour, Luckin, FUTU, BEKE and Miniso


[Consumer Brands Deep Dive]:Structural and Substitution Drive Chinese Consumer

Hong Kong

Nayuki Holdings Limited operates as a holding compnay. The Company, through its subsidiaries, produces and retails tea and bakery products. Nayuki serves customers in China.

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Nayuki Holdings (2150 HK)

China TMT Update (May 5-Pt1): NTES/PDD/LKNCY/2150HK/ATAT：Justice Mobile Launches 2nd Round Test

Labor Day holiday Tourism consumption recovered.(+) NTES: Justice Mobile launches 2nd round of closed beta test (-) PDD: PDD announces RMB 4bn in...

Blue Lotus Research Institute

China TMT Update(Apr.25) - 3690.HK/2150.HK/700.HK/TME: Meituan Riders in Shanwei Go on Strike

3690.HK: Meituan food delivery drivers in Shanwei go on strike (-); 2150HK: Lelecha confirm to launch franchise model (+); 700HK/TME: WeChat tests...

Blue Lotus Research Institute

[Nayuki Holding (2150 HK) Target Price Change]: Business Model Change Has Risky Consequence

Company chose to drastically expand store count by ~600 in 2023. Our concern is that Nayuki stores now are drastically different from its past. We...

Blue Lotus Research Institute

Hong Kong Connect Flows (Mar 24th): Meituan, Tencent, Bilibili

We analyzed the Hong Kong Connect Scheme for last week and highlight flows for Meituan (3690 HK), Tencent (700 HK), and Bilibili (9626 HK).

Ke Yan, CFA, FRM

[Consumer Brands Deep Dive]:Structural and Substitution Drive Chinese Consumer

Chinese underconsumption is only half true. It only occurs in categories associated with development stages; Our TOP PICKS are Li Auto, Atour,...

Blue Lotus Research Institute

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