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

<p>In our weekly HK Connect Flow series, we aim to highlight key stocks and sectors which the mainland investors traded via the southbound Hong Kong Connect, as analyzed by our proprietary data engine.<br><br>Since the opening of Hong Kong Connect scheme in 2014, southbound Chinese money started to play an increasingly important role in the Hong Kong stock market. In a Hong Kong exchange report released in July 2019, the exchange highlighted that flows from mainland China accounted for 12% of the total trading volume in the market and is ahead of the US investors' 10% and UK investors' 7% share respectively. <br><br>We split the stocks eligible for the Hong Kong Connect trade into three groups: HSCEI component stocks, stocks with a market capitalization between USD 1 billion and USD 5 billion, and stocks with a market capitalization between USD 500 million and USD 1 billion.<br><br>In this insight, we will highlight inflows into <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent Holdings (700 HK)</a>, <a href="https://www.smartkarma.com/entities/xiaomi-corp" target="_blank" data-smartkarma-citation="entities:24409:1" rel="noopener">Xiaomi Corp (1810 HK)</a>, <a href="https://www.smartkarma.com/entities/semiconductor-manufacturing-international-corp-smic" target="_blank" data-smartkarma-citation="entities:14231:1" rel="noopener">Semiconductor Manufacturing International Corp (SMIC) (981 HK)</a>, as well as outflows from <a href="https://www.smartkarma.com/entities/smoore-international" target="_blank" data-smartkarma-citation="entities:28241:1" rel="noopener">Smoore International (6969 HK)</a>.</p>

In our weekly HK Connect Flow series, we aim to highlight key stocks and sectors which the mainland investors traded via the southbound Hong Kong Connect, as analyzed by our proprietary data engine.  Since the opening of Hong Kong Connect scheme in 2014, southbound Chinese money started to play an increasingly important role in the Hong Kong stock market. In a Hong Kong exchange report released in July 2019, the exchange highlighted that flows from mainland China accounted for 12% of the total trading volume in the market and is ahead of the US investors' 10% and UK investors' 7% share respectively.   We split the stocks eligible for the Hong Kong Connect trade into three groups: HSCEI component stocks, stocks with a market capitalization between USD 1 billion and USD 5 billion, and stocks with a market capitalization between USD 500 million and USD 1 billion.  In this insight, we will highlight inflows into Tencent Holdings (700 HK), Xiaomi Corp (1810 HK), Semiconductor Manufacturing International Corp (SMIC) (981 HK), as well as outflows from Smoore International (6969 HK).

Hong Kong Connect Flows: Tencent, Xiaomi and SMIC

<p>Hong Kong SFC reported aggregate short position as of Mar 26. Reporting was delayed due to public holiday in Hong Kong. The aggregate short value for equities decreased by $-317m (-0.5%) WoW and decreased by $479m (-0.7%) over the preceding four weeks.</p><p>Most shorted stocks by aggregate short value of positions are Ping An Insurance (Group) Company Of China, Ltd./2318 HK($8,738m, -0.0% WoW), Tencent Holdings Limited/700 HK($2,587m, +7.2% WoW), Zhongsheng Group Holdings Limited/881 HK($1,547m, -4.6% WoW), Byd Company Limited/1211 HK($1,476m, -2.4% WoW), Lenovo Group Limited/992 HK($1,194m, +18.4% WoW).</p><section class="figure"><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/199/443/original/Hong_Kong_Market_Short_Position_Value_%28line%29_and_1W_Changes_%28bar%29_%28%24m%292021-04-08+11_14_28.png?1617852201" class="editor-image img-responsive" data-smartkarma-image-id="199443"></figure></section>

Hong Kong SFC reported aggregate short position as of Mar 26. Reporting was delayed due to public holiday in Hong Kong. The aggregate short value for equities decreased by $-317m (-0.5%) WoW and decreased by $479m (-0.7%) over the preceding four weeks.Most shorted stocks by aggregate short value of positions are Ping An Insurance (Group) Company Of China, Ltd./2318 HK($8,738m, -0.0% WoW), Tencent Holdings Limited/700 HK($2,587m, +7.2% WoW), Zhongsheng Group Holdings Limited/881 HK($1,547m, -4.6% WoW), Byd Company Limited/1211 HK($1,476m, -2.4% WoW), Lenovo Group Limited/992 HK($1,194m, +18.4% WoW).

HK Short Interest: Short Covers for Smoore Intl After the E-Cig Consultation Paper

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

<div>
<p>Linklogis, a technology solution provider for supply chain finance in China raised around US$1bn in its Hong Kong IPO. Its early investors include Tencent, GIC and Standard Chartered Bank.</p>
</div>
<div>
<p>We have covered various aspects of the deal in our earlier notes,</p>
</div>
<div>
<ul style="list-style-type: disc;">
<li>
<a href="https://www.smartkarma.com/insights/linklogis-pre-ipo-the-positives-fast-growing-blockchain-driven-supply-chain-financier" target="_blank" rel="noopener">Linklogis Pre-IPO - The Positives - Fast Growing Blockchain Driven Supply Chain Financier,</a> </li>
<li><a href="https://www.smartkarma.com/insights/linklogis-pre-ipo-the-negatives-inconsistent-growth-and-margins-well-funded-competitors" target="_blank" rel="noopener">Linklogis Pre-IPO - The Negatives - Inconsistent Growth and Margins, Well Funded Competitors, and</a></li>
<li><a href="https://www.smartkarma.com/insights/linklogis-pre-ipo-earnings-forecast-peer-comparison-and-first-stab-at-valuation" target="_blank" rel="noopener">Linklogis Pre-IPO - Earnings Forecast, Peer Comparison and First Stab at Valuation</a></li>
<li><a href="https://www.smartkarma.com/insights/linklogis-pre-ipo-phip-updates-nothing-to-complain-about" target="_blank" rel="noopener">Linklogis Pre-IPO - PHIP Updates - Nothing to Complain About</a></li>
<li><a href="https://www.smartkarma.com/insights/linklogis-ipo-pricey-for-a-reason" target="_blank" rel="noopener">Linklogis IPO - Pricey for a Reason</a></li>
</ul>
</div>
<div>
<p>In this note, we will talk about deal dynamics and updates since our last note.</p>
</div>


Linklogis, a technology solution provider for supply chain finance in China raised around US$1bn in its Hong Kong IPO. Its early investors include Tencent, GIC and Standard Chartered Bank.


We have covered various aspects of the deal in our earlier notes,




Linklogis Pre-IPO - The Positives - Fast Growing Blockchain Driven Supply Chain Financier, 
Linklogis Pre-IPO - The Negatives - Inconsistent Growth and Margins, Well Funded Competitors, and
Linklogis Pre-IPO - Earnings Forecast, Peer Comparison and First Stab at Valuation
Linklogis Pre-IPO - PHIP Updates - Nothing to Complain About
Linklogis IPO - Pricey for a Reason



In this note, we will talk about deal dynamics and updates since our last note.


Linklogis IPO Trading - Decent but Not Hot Demand

Equity Analyst, LightStream Research

Oshadhi Kumarasiri

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Event-Driven

<p>Investors started dumping Chinese e-vapor stocks following the announcement of <a target="_blank">draft amendments to the Tobacco Monopoly Law</a>, if approved could extend the law's jurisdiction to e-cigarettes. As a result, <a href="https://www.smartkarma.com/entities/rlx-technology-inc" target="_blank" data-smartkarma-citation="entities:31113:1" rel="noopener">RLX Technology Inc (RLX US)</a>’s share price plunged 48% while <a href="https://www.smartkarma.com/entities/smoore-international" target="_blank" data-smartkarma-citation="entities:28241:1" rel="noopener">Smoore International (6969 HK)</a>’s (less dependent on China) fell by 23%. Meanwhile, the lock-up period for RLX’s pre-IPO holders’ expiries on 21<sup>st</sup> July 2021 possibly leading to additional selling pressure in the short term.</p>

Investors started dumping Chinese e-vapor stocks following the announcement of draft amendments to the Tobacco Monopoly Law, if approved could extend the law's jurisdiction to e-cigarettes. As a result, RLX Technology Inc (RLX US)’s share price plunged 48% while Smoore International (6969 HK)’s (less dependent on China) fell by 23%. Meanwhile, the lock-up period for RLX’s pre-IPO holders’ expiries on 21st July 2021 possibly leading to additional selling pressure in the short term.

Long Smoore/Short RLX: RLX’s Lock-Up Expiry Could Aggravate the Sell-Off

<p>In our weekly HK Connect Flow series, we aim to highlight key stocks and sectors which the mainland investors traded via the southbound Hong Kong Connect, as analyzed by our proprietary data engine.</p><p>Since the opening of Hong Kong Connect scheme in 2014, southbound Chinese money started to play an increasingly important role in the Hong Kong stock market. In a Hong Kong exchange report released in July 2019, the exchange highlighted that flows from mainland China accounted for 12% of the total trading volume in the market and is ahead of the US investors' 10% and UK investors' 7% share respectively. </p><p>We split the stocks eligible for the Hong Kong Connect trade into three groups: HSCEI component stocks, stocks with a market capitalization between USD 1 billion and USD 5 billion, and stocks with a market capitalization between USD 500 million and USD 1 billion.</p><p>In this insight, we will highlight inflows into Tencent Holdings Limited (700 HK), as well as outflows from Meituan (3690 HK), and Smoore International Holdings Limited (6969 HK).</p>

In our weekly HK Connect Flow series, we aim to highlight key stocks and sectors which the mainland investors traded via the southbound Hong Kong Connect, as analyzed by our proprietary data engine.Since the opening of Hong Kong Connect scheme in 2014, southbound Chinese money started to play an increasingly important role in the Hong Kong stock market. In a Hong Kong exchange report released in July 2019, the exchange highlighted that flows from mainland China accounted for 12% of the total trading volume in the market and is ahead of the US investors' 10% and UK investors' 7% share respectively. We split the stocks eligible for the Hong Kong Connect trade into three groups: HSCEI component stocks, stocks with a market capitalization between USD 1 billion and USD 5 billion, and stocks with a market capitalization between USD 500 million and USD 1 billion.In this insight, we will highlight inflows into Tencent Holdings Limited (700 HK), as well as outflows from Meituan (3690 HK), and Smoore International Holdings Limited (6969 HK).

Hong Kong Connect Flows: Tencent/Meituan Flow Divergence

China

Smoore International is a global leader in atomization technology solutions, specializing in the research, design, and manufacturing of vaping devices, components, and heat-not-burn products for corporate clients and under its own brands like Vaporesso and FEELM. The company also develops beauty atomization products. Headquartered in Shenzhen, China, Smoore International was founded in 2009.

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Smoore International (6969 HK)

Hong Kong Connect Flows: Tencent, Xiaomi and SMIC

Southbound money started to flow into Tencent though is relatively small compared to inflows seen in Jan/Feb. We also note that shares held by...

Ke Yan, CFA, FRM

HK Short Interest: Short Covers for Smoore Intl After the E-Cig Consultation Paper

In this note, we highlight short interest of two stocks, Yihai International and Smoore International. The short interest of the latter was covered...

Ke Yan, CFA, FRM

Linklogis IPO Trading - Decent but Not Hot Demand

Linklogis, a technology solution provider for supply chain finance in China raised around US$1bn in its Hong Kong IPO. Its early investors include...

Sumeet Singh

Long Smoore/Short RLX: RLX’s Lock-Up Expiry Could Aggravate the Sell-Off

In the event, regulatory changes force e-cigarettes to become a monopoly, Smoore might even experience growth in the China business through its B2B...

Oshadhi Kumarasiri

Hong Kong Connect Flows: Tencent/Meituan Flow Divergence

We highlight inflows into Tencent Holdings Limited (700 HK), as well as outflows from Meituan (3690 HK), and Smoore International Holdings Limited...

Ke Yan, CFA, FRM

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