HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Bottom-Up

Shanghai Haohai Biological Tec / Equity Bottom-Up

Shanghai Haohai Biological Tec (688366 CH)

<ul>
<li>The General Office of the State Council issued favorable policy for TCM industry. However, TCM still has to face VBP, therefore <a href="https://www.smartkarma.com/entities/zhangzhou-pientzehuang-pharmaceutical-co-ltd" target="_blank" data-smartkarma-citation="entities:15709:1" rel="noopener">Zhangzhou Pientzehuang Pharmaceutical Co. (600436 CH)</a> and Gushengtang are our top picks..</li>
<li>Pfizer is in talks to acquire Seagen in a deal worth over US$30 billion, but we remain conservative about whether this transaction would ultimately bring expected contributions to Pfizer.</li>
<li>Haohai’s business model fails to bring ideal performance. Increasing competition/declining gross margin cast doubts on the outlook of medical aesthetics business. We’re not optimistic about its potential valuation upside.</li>
</ul>


The General Office of the State Council issued favorable policy for TCM industry. However, TCM still has to face VBP, therefore Zhangzhou Pientzehuang Pharmaceutical Co. (600436 CH) and Gushengtang are our top picks..
Pfizer is in talks to acquire Seagen in a deal worth over US$30 billion, but we remain conservative about whether this transaction would ultimately bring expected contributions to Pfizer.
Haohai’s business model fails to bring ideal performance. Increasing competition/declining gross margin cast doubts on the outlook of medical aesthetics business. We’re not optimistic about its potential valuation upside.


China Healthcare Weekly (March.3) - TCM New Policy, Pfizer to Acquire Seagen, Haohai Biological

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Index Rebalance

Shanghai Fudan Microelectronic / Index Rebalance

Shanghai Fudan Microelectronic (688385 CH)

<ul>
<li>The index committee has continued to use a 6-month minimum listing history leading to five changes to the <a href="https://www.smartkarma.com/entities/sse-science-and-technology-innovation-board-50-index" target="_blank" data-smartkarma-citation="entities:29279:1" rel="noopener">SSE STAR50 (STAR50 INDEX)</a> in March.</li>
<li>One way turnover is estimated at 4.95% and will result in a one-way trade of CNY 4,413m. The estimated impact on the deletes is higher than that on the adds.</li>
<li>The inclusions have outperformed the deletions over multiple time periods. There will be pre-positions on the stocks and those could be unwound over the next week or two.</li>
</ul>


The index committee has continued to use a 6-month minimum listing history leading to five changes to the SSE STAR50 (STAR50 INDEX) in March.
One way turnover is estimated at 4.95% and will result in a one-way trade of CNY 4,413m. The estimated impact on the deletes is higher than that on the adds.
The inclusions have outperformed the deletions over multiple time periods. There will be pre-positions on the stocks and those could be unwound over the next week or two.


STAR50 Index Rebalance: Five Changes as Adds Bigly Outperform Deletes

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 143 stocks over the last week. The average A-H premium was 109.6% as of Feb 17th.</li>
<li>The average A-H premium changed by -2.3ppt week on week, led by consumer discretionary, health care, energy and offset by communication services, consumer staples, materials.</li>
<li>We highlight weekly changes in A-H premium for China Shenhua, PetroChina, GWM, First Tractor.</li>
</ul>


We analyse the changes of A-H premium on 143 stocks over the last week. The average A-H premium was 109.6% as of Feb 17th.
The average A-H premium changed by -2.3ppt week on week, led by consumer discretionary, health care, energy and offset by communication services, consumer staples, materials.
We highlight weekly changes in A-H premium for China Shenhua, PetroChina, GWM, First Tractor.


A-H Premium Weekly (Feb 17th): China Shenhua, PetroChina, GWM, First Tractor

<ul>
<li>We analyse the changes of A-H premium on 143 stocks over the last week. The average A-H premium was 111.9% as of Feb 10th.</li>
<li>The average A-H premium changed by 3.6ppt week on week, led by health care, consumer discretionary, information technology and offset by real estate.</li>
<li>We highlight weekly changes in A-H premium for Great Wall Motor, Huadian, Huaneng, Datang Intl.</li>
</ul>


We analyse the changes of A-H premium on 143 stocks over the last week. The average A-H premium was 111.9% as of Feb 10th.
The average A-H premium changed by 3.6ppt week on week, led by health care, consumer discretionary, information technology and offset by real estate.
We highlight weekly changes in A-H premium for Great Wall Motor, Huadian, Huaneng, Datang Intl.


A-H Premium Weekly (Feb 10th): Premium Compressed for Utilities

<ul>
<li>We analyse the changes of A-H premium on 143 stocks over the last week. The average A-H premium was 109.4% as of Feb 3rd.</li>
<li>The average A-H premium changed by 6.3ppt week on week, led by consumer staples, real estate, materials.</li>
<li>We highlight weekly changes in A-H premium for Great Wall Motor, CICC, Shanghai Haohai, Chalieco, Cosco Ship.</li>
</ul>


We analyse the changes of A-H premium on 143 stocks over the last week. The average A-H premium was 109.4% as of Feb 3rd.
The average A-H premium changed by 6.3ppt week on week, led by consumer staples, real estate, materials.
We highlight weekly changes in A-H premium for Great Wall Motor, CICC, Shanghai Haohai, Chalieco, Cosco Ship.


A-H Premium Weekly (Feb 3rd): Great Wall Motor, CICC, Shanghai Haohai, Chalieco, Cosco Ship

China

Shanghai Haohai Biological Technology Co., Ltd. manufactures absorbable biomedical materials. The Company manufactures and sells intraocular lens, medical sodium hyaluronate, medical chitosan, medical collage sponge, and other products. Shanghai Haohai Biological Technology markets its products worldwide.

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Shanghai Haohai Biological Tec (688366 CH)

China Healthcare Weekly (March.3) - TCM New Policy, Pfizer to Acquire Seagen, Haohai Biological

New favorable policy for TCM industry was released. We analyzed our top picks. Pfizer is in talks to acquire Seagen, but we're conservative about...

Xinyao (Criss) Wang

STAR50 Index Rebalance: Five Changes as Adds Bigly Outperform Deletes

There are 5 changes in March as the index committee stick to a 6-month minimum listing history. The adds have outperformed the deletes by a big...

Brian Freitas

A-H Premium Weekly (Feb 17th): China Shenhua, PetroChina, GWM, First Tractor

We analyzed A-H premium changes in the past week and highlight A-H premium changes for China Shenhua, PetroChina, GWM, First Tractor

Ke Yan, CFA, FRM

A-H Premium Weekly (Feb 10th): Premium Compressed for Utilities

We analyzed A-H premium changes in the past week and highlight A-H premium changes for Great Wall Motor, Huadian, Huaneng, Datang Intl.

Ke Yan, CFA, FRM

A-H Premium Weekly (Feb 3rd): Great Wall Motor, CICC, Shanghai Haohai, Chalieco, Cosco Ship

We analyzed A-H premium changes in the past week and highlight A-H premium changes for Great Wall Motor, CICC, Shanghai Haohai, Chalieco, Cosco Ship.

Ke Yan, CFA, FRM

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52-week Range

Market Cap (USDm)

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