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 31st.</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 highlight flows for Tencent, Meituan, Bilibili, Lenovo, Kingsoft, China Construction Bank.</li>
</ul>


We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of March 31st.
The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.
We highlight flows for Tencent, Meituan, Bilibili, Lenovo, Kingsoft, China Construction Bank.


Hong Kong Connect Flows (Mar 31st): Tencent, Meituan, Bilibili, Lenovo, Kingsoft, CCB

External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

Equity Bottom-Up

<ul><li>In FY22, RemeGen recorded revenue of RMB768mn, including RMB738mn product sales from RC18 and RC48, compared to RMB131mn product sales in FY21.</li><li>The Company improved its product gross profit margin from 48.9% in 2021 to 63.4% in 2022.</li><li>The SG&amp;A expenses in FY22 were RMB713mn, +47.7% YoY, due to the significant expansion in salesforce and increasing marketing activities following the approvals of RC18 and RC48 in 1H21.</li></ul><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

In FY22, RemeGen recorded revenue of RMB768mn, including RMB738mn product sales from RC18 and RC48, compared to RMB131mn product sales in FY21.The Company improved its product gross profit margin from 48.9% in 2021 to 63.4% in 2022.The SG&amp;A expenses in FY22 were RMB713mn, +47.7% YoY, due to the significant expansion in salesforce and increasing marketing activities following the approvals of RC18 and RC48 in 1H21.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

RemeGen (9995 HK) – Wide clinical studies to unlock global potential

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

<ul>
<li>RemeGen reported C2H22 top line in-line with our estimate but 9.4% below consensus. Gross margin, however, beat our estimate by 21ppt. Net-net, non-IFRS operating income missed our expectation by 15%; </li>
<li>The result highlighted RemeGen’s investment case hinging on successful license out. Product revenue itself cannot carry the company to profitability; </li>
<li>With WACC of 17%, we have already provisioned for the license out absence. But we still cut TP by HK$6 to reflect the increasing spending going forward.</li>
</ul>


RemeGen reported C2H22 top line in-line with our estimate but 9.4% below consensus. Gross margin, however, beat our estimate by 21ppt. Net-net, non-IFRS operating income missed our expectation by 15%; 
The result highlighted RemeGen’s investment case hinging on successful license out. Product revenue itself cannot carry the company to profitability; 
With WACC of 17%, we have already provisioned for the license out absence. But we still cut TP by HK$6 to reflect the increasing spending going forward.


[RemeGen (9995 HK) Target Price Change]: Provision for License Out Absence Is Adequate

<ul>
<li>Kelun-Biotech, a China-based integrated innovative biopharmaceutical company, plans to raise up to US$ 300m via a Hong Kong listing.</li>
<li>In this note, we examine the company's two core products, namely SKB264, a TROP2-ADC, and A166, a HER2-ADC. We also look at the company's management and pre-IPO investors.</li>
<li>We think the company is worth investors attention with promising candidates. Its pre-IPO investor line-up is decent.</li>
</ul>


Kelun-Biotech, a China-based integrated innovative biopharmaceutical company, plans to raise up to US$ 300m via a Hong Kong listing.
In this note, we examine the company's two core products, namely SKB264, a TROP2-ADC, and A166, a HER2-ADC. We also look at the company's management and pre-IPO investors.
We think the company is worth investors attention with promising candidates. Its pre-IPO investor line-up is decent.


Kelun-Biotech (科伦博泰) Pre-IPO: Candidates Are Differentiated and Promising

<ul>
<li>We analyse the changes of A-H premium on 143 stocks over the last week. The average A-H premium was 115.1% as of Mar 10th.</li>
<li>The average A-H premium changed by 3.2ppt week on week, led by health care, communication services, information technology.</li>
<li>We highlight weekly changes in A-H premium for China Shenhua, PetroChina, China Southern, ZTE, CRRC, CICC.</li>
</ul>


We analyse the changes of A-H premium on 143 stocks over the last week. The average A-H premium was 115.1% as of Mar 10th.
The average A-H premium changed by 3.2ppt week on week, led by health care, communication services, information technology.
We highlight weekly changes in A-H premium for China Shenhua, PetroChina, China Southern, ZTE, CRRC, CICC.


A-H Premium Weekly (Mar 10th): China Shenhua, PetroChina, China Southern, ZTE, CRRC, CICC

China

RemeGen Co., Ltd. operates biotechnology businesses. The Company develops therapeutic antibody drugs such as antibody drug conjugates (ADC), antibody fusion proteins, monoclonal antibodies and double antibodies. RemeGen provides solutions autoimmune diseases, tumor diseases, and ophthalmic diseases.

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Remegen (9995 HK)

Hong Kong Connect Flows (Mar 31st): Tencent, Meituan, Bilibili, Lenovo, Kingsoft, CCB

We analyzed southbound Hong Kong connect flows in the past week and highlight flows for Tencent, Meituan, Bilibili, Lenovo, Kingsoft, China...

Ke Yan, CFA, FRM

RemeGen (9995 HK) – Wide clinical studies to unlock global potential

In FY22, RemeGen recorded revenue of RMB768mn, including RMB738mn product sales from RC18 and RC48, compared to RMB131mn product sales in FY21.

CMB International

[RemeGen (9995 HK) Target Price Change]: Provision for License Out Absence Is Adequate

With WACC of 17%, we have already provisioned for the license out absence. But we still cut TP by HK$6 to reflect the increasing spending going...

Blue Lotus Research Institute

Kelun-Biotech (科伦博泰) Pre-IPO: Candidates Are Differentiated and Promising

We think the Kelun-Biotech's core products are promising, both with more favorable efficacy and safety profile compared to respective benchmark...

Ke Yan, CFA, FRM

A-H Premium Weekly (Mar 10th): China Shenhua, PetroChina, China Southern, ZTE, CRRC, CICC

We analyzed A-H premium changes in the past week and highlight A-H premium changes for China Shenhua, PetroChina, China Southern, ZTE, CRRC, CICC.

Ke Yan, CFA, FRM

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