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.

Equity Capital Markets

<ul>
<li>InventisBio, a China-based biotech, is looking to raise at least USD 100 million via a Hong Kong listing. CITIC is the sole sponsor.</li>
<li>In this note, we look at the company's two late-stage core products, taragarestrant and D-2570.</li>
<li>We also look at the company's pre-IPO investors and management team.</li>
</ul>


InventisBio, a China-based biotech, is looking to raise at least USD 100 million via a Hong Kong listing. CITIC is the sole sponsor.
In this note, we look at the company's two late-stage core products, taragarestrant and D-2570.
We also look at the company's pre-IPO investors and management team.


InventisBio (益方生物) A+H: Moderate Innovation in Crowded Spaces

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

Contemporary Amperex Technology / Index Rebalance

Contemporary Amperex Technology (3750 HK)

<ul>
<li>Post market close on Friday, Hang Seng Indexes will announce the changes for the <a href="https://www.smartkarma.com/entities/hong-kong-hang-seng-index" target="_blank" data-smartkarma-citation="entities:22899:1" rel="noopener">Hang Seng Index (HSI INDEX)</a> that will be implemented at the close on 6 March.</li>
<li>We highlight 8 stocks that have a higher probability of being added to the index. With the index committee entitled to a lot of discretion, there will be differences.</li>
<li>
<a href="https://www.smartkarma.com/entities/contemporary-amperex-technology-catl-co-limited" target="_blank" data-smartkarma-citation="entities:45179:1" rel="noopener">CATL (3750 HK)</a>, <a href="https://www.smartkarma.com/entities/yum-china-holdings-inc-0533692c-6dae-4014-baa1-ed0b050638f2" target="_blank" data-smartkarma-citation="entities:29259:1" rel="noopener">Yum China Holdings (9987 HK)</a>, <a href="https://www.smartkarma.com/entities/wuxi-xdc-cayman-inc" target="_blank" data-smartkarma-citation="entities:39917:1" rel="noopener">WuXi XDC Cayman (2268 HK)</a> and <a href="https://www.smartkarma.com/entities/3sbio-inc" target="_blank" data-smartkarma-citation="entities:459:1" rel="noopener">3SBio Inc (1530 HK)</a> have better odds than others of being added to the index.</li>
</ul>


Post market close on Friday, Hang Seng Indexes will announce the changes for the Hang Seng Index (HSI INDEX) that will be implemented at the close on 6 March.
We highlight 8 stocks that have a higher probability of being added to the index. With the index committee entitled to a lot of discretion, there will be differences.

CATL (3750 HK), Yum China Holdings (9987 HK), WuXi XDC Cayman (2268 HK) and 3SBio Inc (1530 HK) have better odds than others of being added to the index.


Hang Seng Index (HSI) Rebalance Preview: Inclusion Candidates for Mar26

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Bottom-Up

China Traditional Chinese Medicine / Equity Bottom-Up

China Traditional Chinese Medicine (570 HK)

<ul>
<li>China TCM released Profit Warning. The Company would shift from a profit into a loss in 2025, mainly due to concentrated TCM granules VBP/intensified market competition, assets impairment, remedial taxes.</li>
<li>Based on news, Taiji will collaborate with CNPGC to promote the resolution of horizontal competition.Such commitment will expire on April 14, 2026. In fact, we've seen some progress last year. </li>
<li>China TCM’s valuation is rarely driven by strong fundamentals, but more by privatization rumors. The catalyst for China TCM’s share price in 2026 is CNPGC’s announcement within three months.</li>
</ul>


China TCM released Profit Warning. The Company would shift from a profit into a loss in 2025, mainly due to concentrated TCM granules VBP/intensified market competition, assets impairment, remedial taxes.
Based on news, Taiji will collaborate with CNPGC to promote the resolution of horizontal competition.Such commitment will expire on April 14, 2026. In fact, we've seen some progress last year. 
China TCM’s valuation is rarely driven by strong fundamentals, but more by privatization rumors. The catalyst for China TCM’s share price in 2026 is CNPGC’s announcement within three months.


China TCM (570.HK) - About the 2025 Profit Warning and the Outlook

Guangdong Rong Tai Pharmaceutical / Equity Capital Markets

Guangdong Rong Tai Pharmaceutical (RTP HK)

<ul>
<li>As a digital circulation platform, Rong Tai’s business essence is a “middleman”, with limited added value and a naturally lower profit margin than that of R&amp;D-oriented pharmaceutical companies.</li>
<li>Rong Tai’s profitability is disappointing. It’s difficult for the Company to bring decent returns to investors. This actually reflects from the side the flaws of Rong Tai's business model/channel resources.</li>
<li>Reasonable valuation is RMB1.6bn, lower than post-money valuation after Series B Financing(RMB2.7bn). If market sentiment is pessimistic at the time of IPO, there could be big downward space for valuation.</li>
</ul>


As a digital circulation platform, Rong Tai’s business essence is a “middleman”, with limited added value and a naturally lower profit margin than that of R&amp;D-oriented pharmaceutical companies.
Rong Tai’s profitability is disappointing. It’s difficult for the Company to bring decent returns to investors. This actually reflects from the side the flaws of Rong Tai's business model/channel resources.
Reasonable valuation is RMB1.6bn, lower than post-money valuation after Series B Financing(RMB2.7bn). If market sentiment is pessimistic at the time of IPO, there could be big downward space for valuation.


Pre-IPO Guangdong Rong Tai Pharmaceutical - Low Profitability Is a Pain Point

<ul>
<li>Post market close on Friday, Hang Seng Indexes will announce the changes for the <a href="https://www.smartkarma.com/entities/hong-kong-hang-seng-index" target="_blank" data-smartkarma-citation="entities:22899:1" rel="noopener">Hang Seng Index (HSI INDEX)</a> that will be implemented at the close on 5 December.</li>
<li>We highlight 6 stocks that have a higher probability of being added to the index. With the index committee entitled to a lot of discretion, there will be differences.</li>
<li>
<a href="https://www.smartkarma.com/entities/contemporary-amperex-technology-catl-co-limited" target="_blank" data-smartkarma-citation="entities:45179:1" rel="noopener">CATL (3750 HK)</a> will have a 6-month trading history by implementation of the index changes and is a high probability inclusion to the index. But cornerstone lock-up ends tomorrow.</li>
</ul>


Post market close on Friday, Hang Seng Indexes will announce the changes for the Hang Seng Index (HSI INDEX) that will be implemented at the close on 5 December.
We highlight 6 stocks that have a higher probability of being added to the index. With the index committee entitled to a lot of discretion, there will be differences.

CATL (3750 HK) will have a 6-month trading history by implementation of the index changes and is a high probability inclusion to the index. But cornerstone lock-up ends tomorrow.


Hang Seng Index (HSI) Rebalance Preview: Inclusion Candidates for Dec25

China

Sinopharm Group is a leading Chinese distributor and retailer of pharmaceutical and healthcare products, medical devices, and a supply chain service provider. The company also engages in the production and sale of pharmaceutical products, chemical reagents, and laboratory supplies. It was incorporated in January 2003 and is headquartered in Shanghai, China.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Sinopharm Group (1099 HK)

InventisBio (益方生物) A+H: Moderate Innovation in Crowded Spaces

China-based biotech InventisBio seeks to raise $100 million through Hong Kong listing with CITIC as sole sponsor. We look at its drug pipelines,...

Ke Yan, CFA, FRM

Hang Seng Index (HSI) Rebalance Preview: Inclusion Candidates for Mar26

We highlight 8 potential adds to the HSI in March. CATL is still a high prob add along with Healthcare names. Estimated turnover is 4.1% and trade...

Brian Freitas

China TCM (570.HK) - About the 2025 Profit Warning and the Outlook

China TCM will shift from a profit into a loss in 2025, mainly due to VBP/impairment. Taiji will collaborate with CNPGC to resolve horizontal...

Xinyao (Criss) Wang

Pre-IPO Guangdong Rong Tai Pharmaceutical - Low Profitability Is a Pain Point

Rong Tai's digital circulation platform operates as a "middleman" with limited added value,leading to low profitability/potential downward...

Xinyao (Criss) Wang

Hang Seng Index (HSI) Rebalance Preview: Inclusion Candidates for Dec25

We highlight 6 potential adds to the HSI in Dec. CATL is a high prob add and has a lock-up expiry tomorrow. Estimated turnover is 1.9% and trade is...

Brian Freitas

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

InventisBio (益方生物) A+H: Moderate Innovation in Crowded Spaces

​China-based biotech InventisBio seeks to raise $100 million through Hong Kong listing with CITIC as sole sponsor. We look at its drug pipelines,...

Ke Yan, CFA, FRM

Hang Seng Index (HSI) Rebalance Preview: Inclusion Candidates for Mar26

We highlight 8 potential adds to the HSI in March. CATL is still a high prob add along with Healthcare names. Estimated turnover is 4.1% and trade...

Brian Freitas

China TCM (570.HK) - About the 2025 Profit Warning and the Outlook

​China TCM will shift from a profit into a loss in 2025, mainly due to VBP/impairment. Taiji will collaborate with CNPGC to resolve horizontal...

Xinyao (Criss) Wang

Pre-IPO Guangdong Rong Tai Pharmaceutical - Low Profitability Is a Pain Point

​Rong Tai's digital circulation platform operates as a "middleman" with limited added value,leading to low profitability/potential downward...

Xinyao (Criss) Wang

Hang Seng Index (HSI) Rebalance Preview: Inclusion Candidates for Dec25

We highlight 6 potential adds to the HSI in Dec. CATL is a high prob add and has a lock-up expiry tomorrow. Estimated turnover is 1.9% and trade is...

Brian Freitas

China-based biotech InventisBio seeks to raise $100 million through Hong Kong listing with CITIC as sole sponsor. We look at its drug pipelines,...

China TCM will shift from a profit into a loss in 2025, mainly due to VBP/impairment. Taiji will collaborate with CNPGC to resolve horizontal...

Rong Tai's digital circulation platform operates as a "middleman" with limited added value,leading to low profitability/potential downward...