Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, 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.

Equity Capital Markets

EDDA Healthcare and Technology / Equity Capital Markets

EDDA Healthcare and Technology Holding Limited (EDDA), offers innovative intelligent solutions to enable precision surgery. It aims to raise up to US$300m in its Hong Kong IPO.EDDA provides a precision surgery solution portfolio, consisting of surgical robots series IQQA-Guide, and a portfolio of precision surgery planning software, including IQQA-3D. It has also established a 3D precision surgery digital solution cloud platform in China (IQQA Cloud Platform) which integrates functions of IQQA-3D and enables physicians to collaborate remotely in real time.Through IQQA-3D and IQQA Cloud Platform, it has assisted in over 70,000 precision surgeries in China across 60 of the top 100 hospitals. Its precision surgery planning software is also registered in the United states. It is the largest player in China’s precision surgical planning market for thoracic and abdominal applications, with over a one-third market share, in terms of surgical cases completed in 2020, according to Frost &amp; Sullivan.

EDDA Healthcare and Technology Holding Limited (EDDA), offers innovative intelligent solutions to enable precision surgery. It aims to raise up to US$300m in its Hong Kong IPO.EDDA provides a precision surgery solution portfolio, consisting of surgical robots series IQQA-Guide, and a portfolio of precision surgery planning software, including IQQA-3D. It has also established a 3D precision surgery digital solution cloud platform in China (IQQA Cloud Platform) which integrates functions of IQQA-3D and enables physicians to collaborate remotely in real time.Through IQQA-3D and IQQA Cloud Platform, it has assisted in over 70,000 precision surgeries in China across 60 of the top 100 hospitals. Its precision surgery planning software is also registered in the United states. It is the largest player in China’s precision surgical planning market for thoracic and abdominal applications, with over a one-third market share, in terms of surgical cases completed in 2020, according to Frost &amp; Sullivan.

EDDA Healthcare Pre-IPO - RoboDoc - Has Been Around for a While but Is Just Getting the Robo Going

Silver Point

Thomas J. Monaco

Silver Point is a boutique research firm that focuses on the broader financial services sector, with a particular focus on troubled institutions globally. 

Asia Ex Japan

Thematic (Sector/Industry)

*Document 15: Recently the China Bank and Insurance Regulatory Commission (CBIRC) issued guidance to both banks and insurers on implicit debt of local government financing vehicles (LGFV) via Document 15 – tightening the screws even further;  and*No Let Up In Sight: Coupled with the structural reforms of an increase in risk-based capital minimums for certain state banks, the partial bank Wealth Management Product (WMP) resolution, and the recent reserve requirement ratio (RRR) reduction, these tightening measures should act to contain some of the out of control financial risk within the mainland Chinese financial system.

*Document 15: Recently the China Bank and Insurance Regulatory Commission (CBIRC) issued guidance to both banks and insurers on implicit debt of local government financing vehicles (LGFV) via Document 15 – tightening the screws even further;  and*No Let Up In Sight: Coupled with the structural reforms of an increase in risk-based capital minimums for certain state banks, the partial bank Wealth Management Product (WMP) resolution, and the recent reserve requirement ratio (RRR) reduction, these tightening measures should act to contain some of the out of control financial risk within the mainland Chinese financial system.

Equity Bottom-Up

ZhongAn Online P&C Insurance C / Equity Bottom-Up

*June Premium: ZhongAn Online P&amp;C Insurance (6060.HK) [ZhongAn] reported June 2021 premium growth of 49% YoY, ending 1H21 with gross written premium (GWP) growth of 45% YOY. Two factors contributed to the overall growth: 1) COVID-19 recovery; and 2) the low base in 2020; and*Bottom-line Challenges Remain: The fact of the matter is that ZhongAn’s bottom-line remains challenged. Auto and Consumer Finance have decelerating and declining turnover growth given the continued COVID-19 business disruptions. While YOY combined ratio improved, the improvement came largely from credit insurance whose loss ratio declined from 97% in 2019 to 63%. Given the continued credit insurance headaches at PICC P&amp;C (2328.HK) and Ping An Insurance, we have a difficult time believing that little old ZhongAn has figured out the secret sauce to credit insurance risk.

*June Premium: ZhongAn Online P&amp;C Insurance (6060.HK) [ZhongAn] reported June 2021 premium growth of 49% YoY, ending 1H21 with gross written premium (GWP) growth of 45% YOY. Two factors contributed to the overall growth: 1) COVID-19 recovery; and 2) the low base in 2020; and*Bottom-line Challenges Remain: The fact of the matter is that ZhongAn’s bottom-line remains challenged. Auto and Consumer Finance have decelerating and declining turnover growth given the continued COVID-19 business disruptions. While YOY combined ratio improved, the improvement came largely from credit insurance whose loss ratio declined from 97% in 2019 to 63%. Given the continued credit insurance headaches at PICC P&amp;C (2328.HK) and Ping An Insurance, we have a difficult time believing that little old ZhongAn has figured out the secret sauce to credit insurance risk.

ZhongAn Online P&C Insurance – Still A Dumpster Fire

*Adding Hubei to the Fold: Until recently AIA Group (1299.HK) [AIA] operated only five mainland Chinese provincial licenses in 30 cities with Beijing being the largest premium contributor for AIA China. With the border between mainland China and Hong Kong completely shutdown from 2020, mainland China became AIA’s largest market, contributing 35% to AIA’s VONB. Hong Kong falling on its face isn’t exactly how anyone envisioned mainland China becoming AIA’s largest business driver. AIA’s latest life insurance license approval from the CBIRC was received for Hubei province, reinforcing mainland China’s strategic importance; and*Suffocating Hong Kong Business: AIA’s core Hong Kong business has been an unmitigated disaster for during COVID-19, as it struggles with mainland Chinese visitors. Further, there is limited clarity on AIA’s legacy agents. It also has to deal with the fledgling Bank of East Asia (23.HK) business that it recently acquired.

*Adding Hubei to the Fold: Until recently AIA Group (1299.HK) [AIA] operated only five mainland Chinese provincial licenses in 30 cities with Beijing being the largest premium contributor for AIA China. With the border between mainland China and Hong Kong completely shutdown from 2020, mainland China became AIA’s largest market, contributing 35% to AIA’s VONB. Hong Kong falling on its face isn’t exactly how anyone envisioned mainland China becoming AIA’s largest business driver. AIA’s latest life insurance license approval from the CBIRC was received for Hubei province, reinforcing mainland China’s strategic importance; and*Suffocating Hong Kong Business: AIA’s core Hong Kong business has been an unmitigated disaster for during COVID-19, as it struggles with mainland Chinese visitors. Further, there is limited clarity on AIA’s legacy agents. It also has to deal with the fledgling Bank of East Asia (23.HK) business that it recently acquired.

AIA Group – Hong Kong In Rearview Mirror

*New IPO Disappoints Right Out Of Gate: Waterdrop (WDH.US) [Waterdrop] provides an online insurance marketplace and related medical crowdfunding platform in mainland China. Waterdrop  reported its first set of earnings results since its IPO, coming in at a negative CNY 370.2 bn for 1Q21, declining CNY 249.4 (206.6%) YOY largely given its higher costs from a channel (third party traffic) and product mix shift to long-term insurance. Both factors have caused operating costs to increase CNY 579.1 bn (75.7%) YOY  - far outpacing revenue growth of CNY 229.6 bn (35.1%) over the period; and  *All Is Not Lost…Yet: First year premium (FYP) did increase 42.7% YOY – led by costly third party FYP which increased 51.6%. Long-term critical illness insurance grew 132% off of a low base, but still well exceeding industry average. Anecdotally, management believes that competitive pressures appear to be abating and that increases in customer acquisition costs is now decelerating. In addition, Waterdrop continues to make progress with: Waterdrop Health; Waterdrop Medicine; and with outpatient services.

*New IPO Disappoints Right Out Of Gate: Waterdrop (WDH.US) [Waterdrop] provides an online insurance marketplace and related medical crowdfunding platform in mainland China. Waterdrop  reported its first set of earnings results since its IPO, coming in at a negative CNY 370.2 bn for 1Q21, declining CNY 249.4 (206.6%) YOY largely given its higher costs from a channel (third party traffic) and product mix shift to long-term insurance. Both factors have caused operating costs to increase CNY 579.1 bn (75.7%) YOY  - far outpacing revenue growth of CNY 229.6 bn (35.1%) over the period; and  *All Is Not Lost…Yet: First year premium (FYP) did increase 42.7% YOY – led by costly third party FYP which increased 51.6%. Long-term critical illness insurance grew 132% off of a low base, but still well exceeding industry average. Anecdotally, management believes that competitive pressures appear to be abating and that increases in customer acquisition costs is now decelerating. In addition, Waterdrop continues to make progress with: Waterdrop Health; Waterdrop Medicine; and with outpatient services.

China

Ping An Insurance (Group) Company of China Limited provides products and services through its five ecosystems in financial services, healthcare, auto services, real estate services and Smart City solutions. The Group's insurance business writes property, casualty, and life insurance products.

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Ping An Insurance Group of (PNGAY US)

EDDA Healthcare Pre-IPO - RoboDoc - Has Been Around for a While but Is Just Getting the Robo Going

EDDA Healthcare and Technology Holding Limited (EDDA), offers innovative intelligent solutions to enable precision surgery. It aims to raise up to...

Sumeet Singh

China Banks – Screws Tighten On LGFVs

CHINA BANKS: Recently the CBIRC issued guidance on implicit LGFV debt via Document 15 – further tightening the screws on mainland China's financial...

Thomas J. Monaco

ZhongAn Online P&C Insurance – Still A Dumpster Fire

ZhongAn Online: ZhongAn reported June 2021 premium growth of 49% YoY. Two factors contributed to the growth: COVID-19 recovery; and low base in...

Thomas J. Monaco

AIA Group – Hong Kong In Rearview Mirror

AIA GROUP: In 2020, mainland China became AIA’s largest market. AIA’s received life insurance license approval for Hubei province, reinforcing...

Thomas J. Monaco

Waterdrop – Water Fall

WATERDROP: Waterdrop reported its first set of earnings results since its IPO, declining 206.6% YOY largely due to higher costs from a channel and...

Thomas J. Monaco

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