Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Index Rebalance

Orient Overseas (International) / Index Rebalance

<ul>
<li>The review period for the March review of the HSCI ends on 31 December. There are expected to be a lot more inclusions than deletions at the review.</li>
<li>There are quite a few stocks that should be included following their listing over the last couple of months while others are now potential inclusions after passing the velocity test.</li>
<li>Quite a few of the potential deletions from the HSCI and Stock Connect have large holdings via Southbound Stock Connect and these stock could see some selling.</li>
</ul>


The review period for the March review of the HSCI ends on 31 December. There are expected to be a lot more inclusions than deletions at the review.
There are quite a few stocks that should be included following their listing over the last couple of months while others are now potential inclusions after passing the velocity test.
Quite a few of the potential deletions from the HSCI and Stock Connect have large holdings via Southbound Stock Connect and these stock could see some selling.


HSCI Index Rebalance and Stock Connect: More Inclusions than Exclusions in March

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Equity Capital Markets

NetEase Cloud Music / Equity Capital Markets

<ul>
<li>In <a href="https://www.smartkarma.com/insights/cloud-village-netease-music-ipo-not-yet-a-sound-investment" target="_blank" data-smartkarma-citation="insights:61441" rel="noopener">Cloud Village (NetEase Music) IPO: Not yet a Sound Investment</a>, we stated that the 9M21 update is underwhelming with slowing growth and a marginal decline in losses. </li>
<li>In <a href="https://www.smartkarma.com/insights/cloud-village-netease-music-ipo-valuation-insights" target="_blank" data-smartkarma-citation="insights:61537" rel="noopener">Cloud Village (NetEase Music) IPO: Valuation Insights</a>, we noted that the IPO price is unattractive.  </li>
<li>It priced its IPO at HK$205 and closed <a href="https://inews.hket.com/article/3121049/%E3%80%90%E6%96%B0%E8%82%A1IPO%E3%80%91%E7%B6%B2%E6%98%93%E9%9B%B2%E9%9F%B3%E6%A8%829899%E6%9A%97%E7%9B%A4%E6%94%B6%E8%B7%8C2-%E3%80%80%E4%B8%80%E6%89%8B%E5%B8%B3%E9%9D%A2%E7%B4%84%E8%9D%95200%E5%85%83?mtc=40001&amp;srkw=IPO%E6%9C%80%E5%BF%AB%E6%9C%80%E9%BD%8A" target="_blank" rel="noopener">-2% lower</a> in the grey market. Our base-case DCF value of HK$186.88 per share is a 9% downside to the IPO price.  </li>
</ul>


In Cloud Village (NetEase Music) IPO: Not yet a Sound Investment, we stated that the 9M21 update is underwhelming with slowing growth and a marginal decline in losses. 
In Cloud Village (NetEase Music) IPO: Valuation Insights, we noted that the IPO price is unattractive.  
It priced its IPO at HK$205 and closed -2% lower in the grey market. Our base-case DCF value of HK$186.88 per share is a 9% downside to the IPO price.  


Cloud Village (NetEase Music) IPO: Trading Debut

Equity Analyst, LightStream Research

Shifara Samsudeen, FCMA, CGMA

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

<ul>
<li>Cloud Village raised net proceeds of HK$3,124m (US$406.1m) at HK$205 per share, which is the midpoint of the IPO price range of HK$190-220 per share.</li>
<li>At the IPO price of HK$205 per share, CV will have a market capitalisation of HK$42.6bn and a post-money EV of HK$34.5bn.</li>
<li>The HK offer and the international offer were oversubscribed by 8.92x and 1.7x respectively. Cornerstone investment accounted for 83.15% of the total shares offered at the IPO.</li>
</ul>


Cloud Village raised net proceeds of HK$3,124m (US$406.1m) at HK$205 per share, which is the midpoint of the IPO price range of HK$190-220 per share.
At the IPO price of HK$205 per share, CV will have a market capitalisation of HK$42.6bn and a post-money EV of HK$34.5bn.
The HK offer and the international offer were oversubscribed by 8.92x and 1.7x respectively. Cornerstone investment accounted for 83.15% of the total shares offered at the IPO.


Cloud Village IPO: Thoughts on First Day Trading

APAC IPOs & Placements, Aequitas Research

Clarence Chu

APAC IPOs & Placements

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.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/gushengtang-cayman-ltd" target="_blank" data-smartkarma-citation="entities:33503:1" rel="noopener">Gushengtang (GUS HK)</a> is looking to raise up to US$104m in its Hong Kong IPO. </li>
<li>While there isn’t anything fundamentally wrong with the deal, valuation is at a premium, despite having margins towards the bottom end of its peer set.</li>
<li>Pre-IPO investors, from Mar 2021, would have made gains on listing as well and could remain an overhang post-listing.</li>
</ul>



Gushengtang (GUS HK) is looking to raise up to US$104m in its Hong Kong IPO. 
While there isn’t anything fundamentally wrong with the deal, valuation is at a premium, despite having margins towards the bottom end of its peer set.
Pre-IPO investors, from Mar 2021, would have made gains on listing as well and could remain an overhang post-listing.


Gushengtang IPO - Wide Valuation Gap from Peers

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

<ul>
<li>Cloud Village Inc. (CVI), also known as NetEase Music, raised around US$420m in its Hong Kong IPO.</li>
<li>The company has obtained investments from Baidu and Alibaba, along with other investors.</li>
<li>In this note, we will talk about the trading dynamics.</li>
</ul>


Cloud Village Inc. (CVI), also known as NetEase Music, raised around US$420m in its Hong Kong IPO.
The company has obtained investments from Baidu and Alibaba, along with other investors.
In this note, we will talk about the trading dynamics.


Cloud Village (NetEase Music) IPO Trading - One of the Lowest Insti Subscriptions Yet

China

NetEase Cloud Music operates as one of China's leading online music platforms, offering music streaming, membership subscriptions, digital music sales, and social entertainment services including live streaming and online karaoke. It provides an interactive content community for music enthusiasts with personalized recommendations. The company is headquartered in Hangzhou, China, and was launched in 2013.

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NetEase Cloud Music (9899 HK)

HSCI Index Rebalance and Stock Connect: More Inclusions than Exclusions in March

We expect there will be a lot more inclusions than exclusions at the March rebalance of the HSCI. The changes to the index will result in changes...

Brian Freitas

Cloud Village (NetEase Music) IPO: Trading Debut

Cloud Village will commence trading on Thursday, 2 December. Our base-case DCF value of HK$186.88 per share is a 9% downside to the IPO price of...

Arun George

Cloud Village IPO: Thoughts on First Day Trading

CV raised net proceeds of HK$3,124m (US$406.1m) at HK$205 per share, which is the midpoint of the IPO price range. CV's IPO is overvalued and we...

Shifara Samsudeen, FCMA, CGMA

Gushengtang IPO - Wide Valuation Gap from Peers

Gushengtang (GUS HK) is looking to raise up to US$104m in its Hong Kong IPO. Valuation comes in at a premium, despite having margins towards the...

Clarence Chu

Cloud Village (NetEase Music) IPO Trading - One of the Lowest Insti Subscriptions Yet

Cloud Village Inc. (CVI), also known as NetEase Music, raised around US$420m in its Hong Kong IPO. In this note, we will talk about the trading...

Sumeet Singh

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