IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/shanghai-henlius-biotech-inc" target="_blank" data-smartkarma-citation="entities:27888:1" rel="noopener">Shanghai Henlius Biotech (2696 HK)</a> entered a trading halt “pending the release of an announcement pursuant to the Code on Takeovers and Mergers.” The likely bidder is Fosun Pharma.</li>
<li>A merger by absorption would require approval by at least 75% independent H Shareholders (&lt;10% of all independent H Shareholders rejection). There could also be a 90% minimum acceptance condition. </li>
<li>The shares are 62% below the IPO price. However, shareholders with blocking stakes would welcome an offer suggesting a 30-40% takeover premium would be sufficient.</li>
</ul>



Shanghai Henlius Biotech (2696 HK) entered a trading halt “pending the release of an announcement pursuant to the Code on Takeovers and Mergers.” The likely bidder is Fosun Pharma.
A merger by absorption would require approval by at least 75% independent H Shareholders (&lt;10% of all independent H Shareholders rejection). There could also be a 90% minimum acceptance condition. 
The shares are 62% below the IPO price. However, shareholders with blocking stakes would welcome an offer suggesting a 30-40% takeover premium would be sufficient.


Henlius (2696 HK): Privatisation by Fosun Pharma?

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>Biopharmaceutical outfit <a href="https://www.smartkarma.com/entities/shanghai-henlius-biotech-inc" target="_blank" data-smartkarma-citation="entities:27888:1" rel="noopener">Shanghai Henlius Biotech (2696 HK)</a> is <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2024/0523/2024052300005.pdf" target="_blank" rel="noopener">currently suspended</a> pursuant to the Takeovers Code.</li>
<li>
<a href="https://www.smartkarma.com/entities/shanghai-fosun-pharmaceutical-group" target="_blank" data-smartkarma-citation="entities:8045" rel="noopener">Shanghai Fosun Pharmaceutical (Group) (2196 HK)</a> holds ~60% in Henlius, mostly via domestic shares. Co-founders and Qatar Authority hold ~28% and 8% the H shares respectively.</li>
<li>IF an Offer were to unfold, it would be the third in this space in the past two months, after Offers for <a href="https://www.smartkarma.com/entities/sciclone-pharmaceuticals-holdings-limited" target="_blank" data-smartkarma-citation="entities:17351:1" rel="noopener">Sciclone (6600 HK)</a> and <a href="https://www.smartkarma.com/entities/yichang-hec-changjiang-pharmaceutical" target="_blank" data-smartkarma-citation="entities:21040:1" rel="noopener">Yichang HEC (1558 HK)</a>,</li>
</ul>


Biopharmaceutical outfit Shanghai Henlius Biotech (2696 HK) is currently suspended pursuant to the Takeovers Code.

Shanghai Fosun Pharmaceutical (Group) (2196 HK) holds ~60% in Henlius, mostly via domestic shares. Co-founders and Qatar Authority hold ~28% and 8% the H shares respectively.
IF an Offer were to unfold, it would be the third in this space in the past two months, after Offers for Sciclone (6600 HK) and Yichang HEC (1558 HK),


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

Shanghai Henlius Biotech  / Equity Bottom-Up

<ul><li>Strong sales maintained in 1Q24. Henlius Biotech (Henlius) recorded total revenue of RMB1.349bn in 1Q24, up 35% YoY.</li><li>Of this, HANQUYOU’s sales in China was RMB671mn (+25% YoY, -4% QoQ), which accounted for 23% of our previous FY24 estimate.</li><li>In 1Q24, serplulimab (PD-1) experienced robust growth, +34% YoY or +31% QoQ to RMB334mn, accounting for 23% of our previous FY24 estimate. </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.

Strong sales maintained in 1Q24. Henlius Biotech (Henlius) recorded total revenue of RMB1.349bn in 1Q24, up 35% YoY.Of this, HANQUYOU’s sales in China was RMB671mn (+25% YoY, -4% QoQ), which accounted for 23% of our previous FY24 estimate.In 1Q24, serplulimab (PD-1) experienced robust growth, +34% YoY or +31% QoQ to RMB334mn, accounting for 23% of our previous FY24 estimate. 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.

Henlius Biotech (2696 HK) - Strong Product Sales in 1Q

Blue Lotus China New Economy Research, Blue Lotus Research Institute

Eric Wen

Blue Lotus China New Economy Research

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>C1Q24 was marked by liquidity crises in innovative drug and medical device, and depressed margin in digital health. We believe this is a buying opportunity;</li>
<li>PD-1 has recovered nicely in C2H23 and exceeded our expectation made for 2023.We forecast 20% YoY growth in 2024.Further,pipeline maturity has led to new drugs in autoimmune and metabolic drugs;</li>
<li>Biosimilar has proven to be part of the solution to deal with low paying ability of Chinese healthcare and denial of access to the high paying US healthcare market. </li>
</ul>


C1Q24 was marked by liquidity crises in innovative drug and medical device, and depressed margin in digital health. We believe this is a buying opportunity;
PD-1 has recovered nicely in C2H23 and exceeded our expectation made for 2023.We forecast 20% YoY growth in 2024.Further,pipeline maturity has led to new drugs in autoimmune and metabolic drugs;
Biosimilar has proven to be part of the solution to deal with low paying ability of Chinese healthcare and denial of access to the high paying US healthcare market. 


[Blue Lotus Healthcare Sector Update]: Bottom-Fishing at the Bottom of the Business Cycle

<ul><li>Profit turnaround driven by core business operations. Henliu’s FY23 revenue increased 67.8% YoY to RMB5.40bn, driven by strong sales of HANQUYOU (trastuzumab biosimilar) and serplulimab (PD-1).</li><li>HANQUYOU recorded RMB2.74bn revenue in FY23, +58% YoY.</li><li>We think HANQUYOU may be free from VBP risks in 2024 due to relatively moderate competition landscape for Herceptin biosimilars.</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.

Profit turnaround driven by core business operations. Henliu’s FY23 revenue increased 67.8% YoY to RMB5.40bn, driven by strong sales of HANQUYOU (trastuzumab biosimilar) and serplulimab (PD-1).HANQUYOU recorded RMB2.74bn revenue in FY23, +58% YoY.We think HANQUYOU may be free from VBP risks in 2024 due to relatively moderate competition landscape for Herceptin biosimilars.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.

Henlius Biotech (2696 HK) - Anticipating Sustained Profitability

China

Shanghai Henlius Biotech, Inc develops and produces drugs. The Company develops and produces monoclonal antibody biosimilar drugs, bio betters, novel monoclonal antibodys, and other drugs. Shanghai Henlius Biotech throughout China.

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Shanghai Henlius Biotech (2696 HK)

Henlius (2696 HK): Privatisation by Fosun Pharma?

The shares are 62% below the IPO price. However, shareholders with blocking stakes would welcome an offer suggesting a 30-40% takeover premium...

Arun George

Henlius Biotech (2696 HK): Fosun Offer?

IF Fosun wants to take the company private, an Offer Price of $26/share, may get the job done. $30/share would be optically be more preferable.

David Blennerhassett

Henlius Biotech (2696 HK) - Strong Product Sales in 1Q

Strong sales maintained in 1Q24. Henlius Biotech (Henlius) recorded total revenue of RMB1.349bn in 1Q24, up 35% YoY. Of this, HANQUYOU’s sales in...

CMB International

[Blue Lotus Healthcare Sector Update]: Bottom-Fishing at the Bottom of the Business Cycle

Liquidity crises in healthcare innovation present buying opportunity;PD-1 exceeds expectations with 20%YoY growth forecast for 2024;Biosimilars...

Blue Lotus Research Institute

Henlius Biotech (2696 HK) - Anticipating Sustained Profitability

Henliu’s FY23 revenue increased 67.8% YoY to RMB5.40bn, driven by strong sales of HANQUYOU (trastuzumab biosimilar) and serplulimab (PD-1).

CMB International

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52-week Range

Market Cap (USDm)

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Henlius (2696 HK): Privatisation by Fosun Pharma?

The shares are 62% below the IPO price. However, shareholders with blocking stakes would welcome an offer suggesting a 30-40% takeover premium...

Arun George

Henlius Biotech (2696 HK): Fosun Offer?

IF Fosun wants to take the company private, an Offer Price of $26/share, may get the job done. $30/share would be optically be more preferable.

David Blennerhassett

Henlius Biotech (2696 HK) - Strong Product Sales in 1Q

Strong sales maintained in 1Q24. Henlius Biotech (Henlius) recorded total revenue of RMB1.349bn in 1Q24, up 35% YoY. Of this, HANQUYOU’s sales in...

CMB International

[Blue Lotus Healthcare Sector Update]: Bottom-Fishing at the Bottom of the Business Cycle

​Liquidity crises in healthcare innovation present buying opportunity;PD-1 exceeds expectations with 20%YoY growth forecast for 2024;Biosimilars...

Blue Lotus Research Institute

Henlius Biotech (2696 HK) - Anticipating Sustained Profitability

Henliu’s FY23 revenue increased 67.8% YoY to RMB5.40bn, driven by strong sales of HANQUYOU (trastuzumab biosimilar) and serplulimab (PD-1).

CMB International

Liquidity crises in healthcare innovation present buying opportunity;PD-1 exceeds expectations with 20%YoY growth forecast for 2024;Biosimilars...