Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Beijing Jingneng Clean Energy / Event-Driven

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<p>Subsequent to a low-turnout at the H-share class meeting last Friday (the 19th February), <a href="https://www.smartkarma.com/entities/beijing-jingneng-clean-energy-co-ltd" target="_blank" data-smartkarma-citation="entities:16316:1" rel="noopener">Beijing Jingneng Clean Energy (579 HK)</a>'s shares declined 6.7% on Monday, followed by 6.3% yesterday, and 3.1% today. All on above-average volume. </p>
<p>Jingneng is now trading at a 25% gross spread to the voluntary conditional offer price of HK$2.70/share. Quite remarkable given deal completion is binary, and there is little in the way of clarity to indicate deal failure is more certain.</p>
<p>Jingneng's undisturbed price back in early July 2020 when a possible Offer was first <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2020/0706/2020070602025.pdf" target="_blank" rel="noopener">floated</a>, was HK$1.58. However, the power mix that Jingneng supplies has sector-by-sector average gains - some considerable - since the deal.</p>
<p>Jingneng has overshot to the downside, and is a buy outright or against a basket of peers.</p>
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<div>More below the fold.</div>
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Subsequent to a low-turnout at the H-share class meeting last Friday (the 19th February), Beijing Jingneng Clean Energy (579 HK)'s shares declined 6.7% on Monday, followed by 6.3% yesterday, and 3.1% today. All on above-average volume. 
Jingneng is now trading at a 25% gross spread to the voluntary conditional offer price of HK$2.70/share. Quite remarkable given deal completion is binary, and there is little in the way of clarity to indicate deal failure is more certain.
Jingneng's undisturbed price back in early July 2020 when a possible Offer was first floated, was HK$1.58. However, the power mix that Jingneng supplies has sector-by-sector average gains - some considerable - since the deal.
Jingneng has overshot to the downside, and is a buy outright or against a basket of peers.






More below the fold.






The accounting research firm, GMT Research

Lisa Mangkornkarn

The accounting research firm

GMT Research

GMT Research provides independent insight into markets, sectors and companies throughout Asia. Our unique method of mining a comprehensive collection of corporate financial statements for key data allows us to evaluate the financial health of a company, sectors and the market at large. We also investigate the application of accounting standards by companies and sectors, shedding light on the quality of reported profits. Armed with this information, we help investment professionals navigate the financial landscape.

Equity Bottom-Up

Beijing Enterprises Water Group / Equity Bottom-Up

<p>Strip away questionable concession accounting and <a href="https://www.smartkarma.com/entities/1660" target="_blank" data-smartkarma-citation="entities:1660">Beijing Enterprises Water Group</a> (BEW) is barely able to generate a profit. Growth has been driven by accounting changes, the treatment of acquisitions, one-off gains and a host of other doubtful items. An inability to generate operating cash inflows would seem to confirm our concerns and suggests the company will have difficulty in servicing HK$28bn (US$3.6bn) of debt,<strong> around half of which is unhedged foreign debt.</strong></p><blockquote><p>BEW is only able to survive…</p></blockquote>

Strip away questionable concession accounting and Beijing Enterprises Water Group (BEW) is barely able to generate a profit. Growth has been driven by accounting changes, the treatment of acquisitions, one-off gains and a host of other doubtful items. An inability to generate operating cash inflows would seem to confirm our concerns and suggests the company will have difficulty in servicing HK$28bn (US$3.6bn) of debt, around half of which is unhedged foreign debt.BEW is only able to survive…

Hong Kong

Shandong Hi-Speed New Energy Group invests in, develops, constructs, operates, and manages photovoltaic power, wind power, and clean heat supply services in the People's Republic of China. The company also provides engineering, procurement, construction, and technical consultancy services for clean energy projects. It was founded in 2000 and is headquartered in Central, Hong Kong.

Shandong Hi-Speed New Energy Group (1250 HK)

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Shandong Hi-Speed New Energy Group (1250 HK)

Beijing Jingneng (579 HK): This Is A Buy

If it does not go through, the downside should be limited. And current valuations are not demanding - 8.8x PER on an LTM basis. I would buy...

David Blennerhassett

BJ ENT WATER: Hiding Behind the Numbers

Strip away questionable concession accounting and Beijing Enterprises Water Group (BEW) is barely able to generate a profit. Growth has been driven...

GMT Research

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