Asia Pac ECM and Index Rebal, Shenton Research

Ke Yan, CFA, FRM

Asia Pac ECM and Index Rebal

Asia Pac IPO & Placement Research, China Biotech

DZT Research

DZT Research is an independent Asia Pacific equity specialist. Our quantitative research covers index rebalancing flows, alongside exchange data analytics accross Asia Pacific. On the equity capital markets side, we focus on Asia Pacific ECM, especially biotech and TMT. Our lead analyst is frequently cited by international media.

Quantitative Analysis

<ul>
<li>We analyse the changes of A-H premium on 180 stocks over the last week. The average A-H premium was 68.3% as of Apr 10th.</li>
<li>The average A-H premium changed by -1.8ppt week-on-week, led by financials, materials, information technology and offset by communication services, real estate.</li>
<li>We highlight weekly changes in A-H premium for ABC, Weichai Power, CICC, ICBC.</li>
</ul>


We analyse the changes of A-H premium on 180 stocks over the last week. The average A-H premium was 68.3% as of Apr 10th.
The average A-H premium changed by -1.8ppt week-on-week, led by financials, materials, information technology and offset by communication services, real estate.
We highlight weekly changes in A-H premium for ABC, Weichai Power, CICC, ICBC.


A-H Premium Weekly (Apr 10th): ABC, Weichai Power, CICC, ICBC

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>In early Feb2020, the #1 shareholder of HK-based elderly home care provider <a href="https://www.smartkarma.com/entities/pine-care-group-ltd" target="_blank" data-smartkarma-citation="entities:28845:1" rel="noopener">Pine Care Group (1989 HK)</a> sold a 52% stake at HK$1.647, keeping 14.99%. That triggered an Unconditional MGO. </li>
<li>In Aug2022, much of the shareholder consortium which bought in 2020 agreed to sell 56.15% at HK$0.89/share to local privately-held developer Chinachem. That will trigger another Unconditional MGO.</li>
<li>The business has suffered under covid, but it is not clear why the business would be better now. Revenues will spike when Causeway Bay opens, but.... Sell. </li>
</ul>


In early Feb2020, the #1 shareholder of HK-based elderly home care provider Pine Care Group (1989 HK) sold a 52% stake at HK$1.647, keeping 14.99%. That triggered an Unconditional MGO. 
In Aug2022, much of the shareholder consortium which bought in 2020 agreed to sell 56.15% at HK$0.89/share to local privately-held developer Chinachem. That will trigger another Unconditional MGO.
The business has suffered under covid, but it is not clear why the business would be better now. Revenues will spike when Causeway Bay opens, but.... Sell. 


Pine Care Group - Another MGO, Still Wrong Price Making One Wonder...

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Bottom-Up

<ul>
<li>Although Pine Care’s revenue kept growing in recent years, its net loss widened, with declining profitability. Single customer risk, high debt and cash flow pressure are also hidden dangers.</li>
<li>The elderly care service is characterized by high investment, long payback period, high risk, low profit margin/rate of return, strong public welfare attributes, etc. So, Pine Care’s outlook is challenging.</li>
<li>We recommend investors to view Chinachem’s acquisition of Pine Care rationally, unless Pine Care could demonstrate some positive signals in Mainland business, which is the key for future valuation expansion.  </li>
</ul>


Although Pine Care’s revenue kept growing in recent years, its net loss widened, with declining profitability. Single customer risk, high debt and cash flow pressure are also hidden dangers.
The elderly care service is characterized by high investment, long payback period, high risk, low profit margin/rate of return, strong public welfare attributes, etc. So, Pine Care’s outlook is challenging.
We recommend investors to view Chinachem’s acquisition of Pine Care rationally, unless Pine Care could demonstrate some positive signals in Mainland business, which is the key for future valuation expansion.  


Pine Care Group (1989.HK) - Hard to Make Profits Due to Industry Characteristics; Here Is What to Do

Global Healthcare Analyst

Tina Banerjee

<ul>
<li>Hong Kong’s leading property developer, Chinachem Group agreed to acquire a 56.15% stake in <a href="https://www.smartkarma.com/entities/pine-care-group-ltd" target="_blank" data-smartkarma-citation="entities:28845:1" rel="noopener">Pine Care Group (1989 HK)</a> for HKD451.2 million ($57.5 million) from its controlling shareholders.</li>
<li>Post-Acquisition, Chinachem will launch an unconditional mandatory offer for the remaining shares, which it does not hold at HKD0.89 per share, same as the purchase price.</li>
<li>Considering delisting risk, limited upside potential of the shares after a huge run-up, and muted growth outlook of the company, investors should tender their holdings.  </li>
</ul>


Hong Kong’s leading property developer, Chinachem Group agreed to acquire a 56.15% stake in Pine Care Group (1989 HK) for HKD451.2 million ($57.5 million) from its controlling shareholders.
Post-Acquisition, Chinachem will launch an unconditional mandatory offer for the remaining shares, which it does not hold at HKD0.89 per share, same as the purchase price.
Considering delisting risk, limited upside potential of the shares after a huge run-up, and muted growth outlook of the company, investors should tender their holdings.  


Pine Care Group (1989 HK): Chinachem Takeover Offers a Good Exit Opportunity for Investors

Quality-first, Business-perspective, Long-term, Urbem (HK) Limited

Urbem Capital

Quality-first, Business-perspective, Long-term

<ul>
<li>The aging population is among the most unarguable mega-trends in today's world and can act as both a powerful headwind and a tailwind (for some industries);</li>
<li>In the past, I have touched upon some businesses benefiting drastically from the demographic tailwind, but admittedly, most of them are well recognized, and hence, expensive;</li>
<li>In this episode, I would like to discuss one more name monetizing the aging population in the Far East;</li>
<li>While being lesser-known, Kato Holdings appears to be a decent candidate to beat my 20% hurdle rate and become a multi-bagger in the foreseeable future.</li>
</ul>


The aging population is among the most unarguable mega-trends in today's world and can act as both a powerful headwind and a tailwind (for some industries);
In the past, I have touched upon some businesses benefiting drastically from the demographic tailwind, but admittedly, most of them are well recognized, and hence, expensive;
In this episode, I would like to discuss one more name monetizing the aging population in the Far East;
While being lesser-known, Kato Holdings appears to be a decent candidate to beat my 20% hurdle rate and become a multi-bagger in the foreseeable future.


One Hidden Gem Monetizing The Aging Population

Hong Kong

Pine Care Group is a Hong Kong-based company primarily engaged in providing senior care services through its residential care homes for the elderly. The company offers professional nursing, caretaking, nutritional management, medical services, psychological and social care, and individualized care plans. Pine Care Group was founded in 1989 and is headquartered in Hong Kong.

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Pine Care Group (1989 HK)

A-H Premium Weekly (Apr 10th): ABC, Weichai Power, CICC, ICBC

We analyzed A-H premium changes in the past week and highlight A-H premium changes for ABC, Weichai Power, CICC, ICBC. We analyse the changes of A...

Ke Yan, CFA, FRM

Pine Care Group - Another MGO, Still Wrong Price Making One Wonder...

Pine Care Group is undergoing its second change of ownership/control in 3yrs as the Tang family sells out to Chinachem (the Wang family). It's...

Travis Lundy