Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>There are people who'll take profit in <a href="https://www.smartkarma.com/entities/seven-i-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:1041:1" rel="noopener">Seven &amp; I (3382 JP)</a> because of path dependency til year-end. It will drag out a while: buy the dips, trim on pops.</li>
<li>Just like in <a href="https://www.smartkarma.com/entities/lufax-holding-ltd-b751749a-8feb-4b4d-85a7-d99ac0308fe7" target="_blank" data-smartkarma-citation="entities:40067:1" rel="noopener">Lufax Holding (6623 HK)</a>'s special dividend, expect Ping An to boost its holding in <a href="https://www.smartkarma.com/entities/ping-an-healthcare-and-technology-company-limited" target="_blank" data-smartkarma-citation="entities:27008:1" rel="noopener">Ping An Healthcare and Technology (1833 HK)</a> via the stealthy scrip dividend option. </li>
<li>The landscape for <a href="https://www.smartkarma.com/entities/nec-networks-system-integr" target="_blank" data-smartkarma-citation="entities:16396:1" rel="noopener">Nec Networks &amp; System Integr (1973 JP)</a> has FULLY changed. The details now matter quite a bit. NEC has two basic choices. Neither are that palatable.  </li>
</ul>


There are people who'll take profit in Seven &amp; I (3382 JP) because of path dependency til year-end. It will drag out a while: buy the dips, trim on pops.
Just like in Lufax Holding (6623 HK)'s special dividend, expect Ping An to boost its holding in Ping An Healthcare and Technology (1833 HK) via the stealthy scrip dividend option. 
The landscape for Nec Networks &amp; System Integr (1973 JP) has FULLY changed. The details now matter quite a bit. NEC has two basic choices. Neither are that palatable.  


Last Week in Event SPACE: Seven & I, PA Gooddoctor, Nec Networks, Genscript/Legend, ASM PT, Hanwha

<ul>
<li>On the 6th October, <a href="https://www.smartkarma.com/entities/sihuan-pharmaceutical-hldgs" target="_blank" data-smartkarma-citation="entities:33:1" rel="noopener">Sihuan Pharmaceutical Hldgs (460 HK)</a> announced a HK$500mn, 12-month buyback programme. Shares jumped 31% on the news, but have since given all that gain back.</li>
<li>Sihuan Pharma has now announced an intention to spin-off non-wholly-owned subsidiary Xuanzhu Biopharm on the HKEx. </li>
<li>Concurrent with the spin-off news. Sihuan Pharma acquired 6.9% in Xuanzhu Biopharm for RMB596mn, implying a full value of ~RMB8.5bn (~HK$9.2bn). This compares to Sihuan Pharma's market cap of HK$6.6bn. </li>
</ul>


On the 6th October, Sihuan Pharmaceutical Hldgs (460 HK) announced a HK$500mn, 12-month buyback programme. Shares jumped 31% on the news, but have since given all that gain back.
Sihuan Pharma has now announced an intention to spin-off non-wholly-owned subsidiary Xuanzhu Biopharm on the HKEx. 
Concurrent with the spin-off news. Sihuan Pharma acquired 6.9% in Xuanzhu Biopharm for RMB596mn, implying a full value of ~RMB8.5bn (~HK$9.2bn). This compares to Sihuan Pharma's market cap of HK$6.6bn. 


Sihuan Pharmaceutical (460 HK): Buybacks, Now A Spin-Off

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Bottom-Up

<ul>
<li>Investors always have expectations for Chinese CXOs, believing that BIOSECURE Act will not pass and Chinese CXOs will bottom out. We can understand this, but we have to be rational.</li>
<li>Selling the operations that have been negatively affected is a reasonable choice, which helps stabilize WuXi’s business/market expectations. But this does not necessarily mean the geopolitical conflict will end here.</li>
<li>Without persuasive long-term logic, share price of Sihuan would still underperform. Despite strong performance of Chinese stocks, we advise investors to do short-term trading on <a href="https://www.smartkarma.com/entities/sihuan-pharmaceutical-hldgs" target="_blank" data-smartkarma-citation="entities:33:1" rel="noopener">Sihuan Pharmaceutical Hldgs (460 HK)</a>.</li>
</ul>


Investors always have expectations for Chinese CXOs, believing that BIOSECURE Act will not pass and Chinese CXOs will bottom out. We can understand this, but we have to be rational.
Selling the operations that have been negatively affected is a reasonable choice, which helps stabilize WuXi’s business/market expectations. But this does not necessarily mean the geopolitical conflict will end here.
Without persuasive long-term logic, share price of Sihuan would still underperform. Despite strong performance of Chinese stocks, we advise investors to do short-term trading on Sihuan Pharmaceutical Hldgs (460 HK).


China Healthcare Weekly (Oct.6) - WuXi to Sell Assets, Be Rational on China CXO, Sihuan Underperform

Asian Hedge Fund Manager, Long Short Equity, Macro

David Mudd

Budweiser Brewing Company APAC / Equity Bottom-Up

<ul>
<li>Hong Kong market still trades at a substantial discount to Analyst year end price targets.</li>
<li>Budweiser APAC is dependent on China's consumer to lift sales while Anta Sports is targeting increased sales from the upcoming Paris Olympics.</li>
<li>Sunny Optical is seeing substantial growth from it EV segment and Haitian continues to grow its international sales.  Shineway RX is a rare value play in the pharmaceutical sector.</li>
</ul>


Hong Kong market still trades at a substantial discount to Analyst year end price targets.
Budweiser APAC is dependent on China's consumer to lift sales while Anta Sports is targeting increased sales from the upcoming Paris Olympics.
Sunny Optical is seeing substantial growth from it EV segment and Haitian continues to grow its international sales.  Shineway RX is a rare value play in the pharmaceutical sector.


BUY/SELL/HOLD: Hong Kong Stocks Update (July 15)

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.

China Traditional Chinese Medicine / Event-Driven

China Traditional Chinese Medicine (570 HK)

<ul>
<li>On 21 February, <a href="https://www.smartkarma.com/entities/china-traditional-chinese-medicine" target="_blank" data-smartkarma-citation="entities:351:1" rel="noopener">China Traditional Chinese Medicine (570 HK)</a> announced a privatisation offer from the Sinopharm-led consortium at HK$4.60 per share, a 47.4% premium to the undisturbed price.</li>
<li>The wide gross spread (7.0%) reflects risks around the re-rating of peers, the slow pace of satisfying the pre-condition, the completion timetable and Ping An’s blocking stake. </li>
<li>The key risk is the deal close timing due to the slow pace of regulatory approvals, which increases the chance that the vote will held after the August interim.   </li>
</ul>


On 21 February, China Traditional Chinese Medicine (570 HK) announced a privatisation offer from the Sinopharm-led consortium at HK$4.60 per share, a 47.4% premium to the undisturbed price.
The wide gross spread (7.0%) reflects risks around the re-rating of peers, the slow pace of satisfying the pre-condition, the completion timetable and Ping An’s blocking stake. 
The key risk is the deal close timing due to the slow pace of regulatory approvals, which increases the chance that the vote will held after the August interim.   


China Traditional Chinese Medicine (570 HK): Evaluating Deal-Break Risks

China

Sihuan Pharmaceutical is a pharmaceutical and medical aesthetic company engaged in the research, development, manufacturing, and sale of products. It offers drugs across therapeutic areas such as oncology, metabolism, diabetes, and cardiovascular diseases, alongside medical aesthetic solutions. The company was founded in 2001 and is headquartered in Wan Chai, Hong Kong.

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Sihuan Pharmaceutical (460 HK)

Last Week in Event SPACE: Seven & I, PA Gooddoctor, Nec Networks, Genscript/Legend, ASM PT, Hanwha

It’s Sunday! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed during the...

David Blennerhassett