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>SANYI delivered impressive core net profit growth of 43% YoY in 2Q22.</li><li>The surprise came from a strong recovery of gross margin, which expanded 3.8ppt YoY and 5.8ppt QoQ to 26.9%, the highest level since 3Q21. </li><li>Looking ahead, we expect the decline in freight rate and steel price will continue to drive margin improvement in 2H22E. </li></ul>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.

SANYI delivered impressive core net profit growth of 43% YoY in 2Q22.The surprise came from a strong recovery of gross margin, which expanded 3.8ppt YoY and 5.8ppt QoQ to 26.9%, the highest level since 3Q21. Looking ahead, we expect the decline in freight rate and steel price will continue to drive margin improvement in 2H22E. 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.

SANY International (631 HK) – Beat expectation: 2Q22 core profit +43% YoY on strong margin recovery

HK/China Equity Long-Short

Osbert Tang, CFA

Thematic (Sector/Industry)

<ul>
<li>Construction machinery sales sustained sequential improvement in Jun. Excavator sales -10.1% (-24.2% in May and -47.3% in Apr) and wheel loader sales -5.8% (-27% in May and -40.2% in Apr).  </li>
<li>It is likely to return to positive YoY in the next two months. Aided by a low base for comparison and increase infrastructure spending in 2H22, industry prospects look brighter. </li>
<li>Both <a href="https://www.smartkarma.com/entities/lonking-holdings-ltd" target="_blank" data-smartkarma-citation="entities:3944:1" rel="noopener">Lonking Holdings (3339 HK)</a> and <a href="https://www.smartkarma.com/entities/zoomlion-heavy-industry-h" target="_blank" data-smartkarma-citation="entities:7817:1" rel="noopener">Zoomlion Heavy Industry (1157 HK)</a> are close to inflexion point, though risks remain high before the disappointing 1H22 result. Beyond that, value may emerge. </li>
</ul>


Construction machinery sales sustained sequential improvement in Jun. Excavator sales -10.1% (-24.2% in May and -47.3% in Apr) and wheel loader sales -5.8% (-27% in May and -40.2% in Apr).  
It is likely to return to positive YoY in the next two months. Aided by a low base for comparison and increase infrastructure spending in 2H22, industry prospects look brighter. 
Both Lonking Holdings (3339 HK) and Zoomlion Heavy Industry (1157 HK) are close to inflexion point, though risks remain high before the disappointing 1H22 result. Beyond that, value may emerge. 


China Construction Machinery: Turning to Positive Soon?

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 analyzed the latest HK SFC report for aggregate short position as of May 13th. </li>
<li>Top short increases and decreases were tabulated for one week and four week period. </li>
<li>We highlight short interest changes in Meituan, Kuaishou, Li Auto, Bilibi, and Sany Heavy.</li>
</ul>


We analyzed the latest HK SFC report for aggregate short position as of May 13th. 
Top short increases and decreases were tabulated for one week and four week period. 
We highlight short interest changes in Meituan, Kuaishou, Li Auto, Bilibi, and Sany Heavy.


HK Short Interest: Meituan, Kuaishou, Li Auto, Bilibili, Sany

<ul>
<li>We analyzed the latest HK SFC report for aggregate short position as of May 6th.</li>
<li>Top short increases and decreases were tabulated for one week and four week period. </li>
<li>We highlight week on week short spike in Bilibili, and Sany Heavy. </li>
</ul>


We analyzed the latest HK SFC report for aggregate short position as of May 6th.
Top short increases and decreases were tabulated for one week and four week period. 
We highlight week on week short spike in Bilibili, and Sany Heavy. 


HK Short Interest: Short Spikes for Bilibili, Sany Heavy

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Hitachi Construction Machinery / Event-Driven

<ul>
<li>On Thursday we saw news of a Hitachi sale of half its stake in HCM. Friday the stock traded down hard. Friday night saw news that underwhelmed further. </li>
<li>The deal is big, but it is basically a deal to get Hitachi out as parent. There is no Capital Alliance and there is no Strategic Alliance yet. </li>
<li>There simply is not much there, there yet. And the stock is less liquid than it looks, and that won't get better any time soon.</li>
</ul>


On Thursday we saw news of a Hitachi sale of half its stake in HCM. Friday the stock traded down hard. Friday night saw news that underwhelmed further. 
The deal is big, but it is basically a deal to get Hitachi out as parent. There is no Capital Alliance and there is no Strategic Alliance yet. 
There simply is not much there, there yet. And the stock is less liquid than it looks, and that won't get better any time soon.


Hitachi Construction Machinery Deal To Change "Parent" - There's Not Much There There

China

Sany Heavy Equipment International Holdings Co Ltd. manufactures coal mining equipment, including roadheaders.

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Sany Heavy Equipment (631 HK)

SANY International (631 HK) – Beat expectation: 2Q22 core profit +43% YoY on strong margin recovery

The surprise came from a strong recovery of gross margin, which expanded 3.8ppt YoY and 5.8ppt QoQ to 26.9%, the highest level since 3Q21.

CMB International

China Construction Machinery: Turning to Positive Soon?

The pace of decline in construction machinery sales continued to narrow in Jun, and prospects will further improve in 2H22. Opportunities may...

Osbert Tang, CFA

HK Short Interest: Meituan, Kuaishou, Li Auto, Bilibili, Sany

We highlight short interest changes in Meituan, Kuaishou, Li Auto, Bilibi, and Sany Heavy based on the latest HK SFC short aggregate report.

Ke Yan, CFA, FRM

HK Short Interest: Short Spikes for Bilibili, Sany Heavy

We highlight week on week short spike in Bilibili (9626 HK), and Sany Heavy (631 HK) based on the latest HK SFC Short Aggregate report..

Ke Yan, CFA, FRM

Hitachi Construction Machinery Deal To Change "Parent" - There's Not Much There There

The Hitachi deal to sell a 26% stake in Hitachi Construction Machinery to Itochu and Japan Industrial Partners is deceptive. It is just a trade...

Travis Lundy

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