HK/China Equity Long-Short

Osbert Tang, CFA

Equity Bottom-Up

China Tourism Group Duty Free / Equity Bottom-Up

<ul>
<li>In the near-term, China's relaxation of COVID-combating measures will boost consumption and demand for cross-province travel. <a href="https://www.smartkarma.com/entities/china-tourism-group-duty-free-corporation-limited" target="_blank" data-smartkarma-citation="entities:36229:1" rel="noopener">China Tourism Group Duty Free Corp Ltd (1880 HK)</a> is a beneficiary.</li>
<li>Hotel bookings in Sanya have surged over the last two days, reflecting positive demand reaction. However, China's full border opening likely in 2023 is a challenge to CDFC.  </li>
<li>Low base in FY22 will drive 45% earnings growth for FY23. However, valuations are not cheap at 33.8x PER for FY23, a significant premium to consumption sector and international peers.</li>
</ul>


In the near-term, China's relaxation of COVID-combating measures will boost consumption and demand for cross-province travel. China Tourism Group Duty Free Corp Ltd (1880 HK) is a beneficiary.
Hotel bookings in Sanya have surged over the last two days, reflecting positive demand reaction. However, China's full border opening likely in 2023 is a challenge to CDFC.  
Low base in FY22 will drive 45% earnings growth for FY23. However, valuations are not cheap at 33.8x PER for FY23, a significant premium to consumption sector and international peers.


CTG Duty Free (1880 HK): Near-Term Positive but It Is Not Cheap at All

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

<ul>
<li>
<a href="https://www.smartkarma.com/entities/giant-biogene-holding-co-ltd" target="_blank" data-smartkarma-citation="entities:35950:1" rel="noopener">Giant Biogene Holding (GBH HK)</a>  aims to raise around US$500m in its Hong Kong IPO.</li>
<li>GB is a leader in the bioactive ingredient-based professional skin treatment product industry in China.</li>
<li>We had looked at the company’s past performance in our previous notes. In this note, we’ll undertake a peer comparison.</li>
</ul>



Giant Biogene Holding (GBH HK)  aims to raise around US$500m in its Hong Kong IPO.
GB is a leader in the bioactive ingredient-based professional skin treatment product industry in China.
We had looked at the company’s past performance in our previous notes. In this note, we’ll undertake a peer comparison.


Giant Biogene Pre-IPO - Peer Comparison - Might Need to Spend a Lot More Online

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Index Rebalance

<ul>
<li>The Hang Seng Index Team announced four changes to the Hang Seng Index, bringing membership to 73 from 69, on its way to 80, but later than originally targeter mid-2022. </li>
<li>Additions are <a href="https://www.smartkarma.com/entities/china-shenhua-energy-co-h" target="_blank" data-smartkarma-citation="entities:382:1" rel="noopener">China Shenhua Energy Co H (1088 HK)</a>, <a href="https://www.smartkarma.com/entities/chow-tai-fook-jewellery-group" target="_blank" data-smartkarma-citation="entities:549:1" rel="noopener">Chow Tai Fook Jewellery (1929 HK)</a>, <a href="https://www.smartkarma.com/entities/hansoh-pharmaceutical-group" target="_blank" data-smartkarma-citation="entities:23675:1" rel="noopener">Hansoh Pharmaceutical (3692 HK)</a>, and <a href="https://www.smartkarma.com/entities/baidu-inc-a55ca720-5968-48f0-8194-ac94390d065c" target="_blank" data-smartkarma-citation="entities:32212:1" rel="noopener">Baidu (9888 HK)</a>. </li>
<li>Official placeholder turnover is about 3.8%. Small changes due to capping updates still to come. China Shenhua and possibly Chow Tai Fook look interesting as trades.</li>
</ul>


The Hang Seng Index Team announced four changes to the Hang Seng Index, bringing membership to 73 from 69, on its way to 80, but later than originally targeter mid-2022. 
Additions are China Shenhua Energy Co H (1088 HK), Chow Tai Fook Jewellery (1929 HK), Hansoh Pharmaceutical (3692 HK), and Baidu (9888 HK). 
Official placeholder turnover is about 3.8%. Small changes due to capping updates still to come. China Shenhua and possibly Chow Tai Fook look interesting as trades.


Hang Seng Index Rebalance - FOUR Names IN, None Out (The March to 80 Continues)

China Tourism Group Duty Free Corp Ltd / Equity Capital Markets

China Tourism Group Duty Free Corp Ltd (601888 CH)

<ul>
<li>China Tourism Group Duty Free Corporation Limited (CDF) aims to raise around US$2.5bn in its H-share listing in Hong Kong.</li>
<li>As per Frost &amp; Sullivan, CDF had 92.3% market share by retail revenue in China duty-free merchandise sales in 2020.</li>
<li>In this note, we talk about the deal pricing and run the deal through our ECM framework.</li>
</ul>


China Tourism Group Duty Free Corporation Limited (CDF) aims to raise around US$2.5bn in its H-share listing in Hong Kong.
As per Frost &amp; Sullivan, CDF had 92.3% market share by retail revenue in China duty-free merchandise sales in 2020.
In this note, we talk about the deal pricing and run the deal through our ECM framework.


China Tourism Group A/H Listing - Discount Is Enticing at the Low-End

<ul>
<li>Giant Biogene (GB) aims to raise around US$500m in its Hong Kong IPO.</li>
<li>GB is a leader in the bioactive ingredient-based professional skin treatment product industry in China.</li>
<li>In this note, we talk about the positive aspects of the deal.</li>
</ul>


Giant Biogene (GB) aims to raise around US$500m in its Hong Kong IPO.
GB is a leader in the bioactive ingredient-based professional skin treatment product industry in China.
In this note, we talk about the positive aspects of the deal.


Giant Biogene Pre-IPO - The Positives - Fast Growth and Juicy Margins

Hong Kong

Topsports International Holdings Limited is a leading sportswear retailer primarily engaged in the trading of sports shoes and apparel, and the distribution of international brands such as Nike, Adidas, and Puma. The company also leases commercial spaces for concessionaire sales and operates in the esports sector. It was founded in 1999 and is headquartered in Kwai Chung, Hong Kong.

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Topsports International (6110 HK)

CTG Duty Free (1880 HK): Near-Term Positive but It Is Not Cheap at All

China's relaxation of COVID control will bring better near-term outlook, as reflected by surge in Sanya's hotel bookings. There are still...

Osbert Tang, CFA

Giant Biogene Pre-IPO - Peer Comparison - Might Need to Spend a Lot More Online

Giant Biogene Holding aims to raise around US$500m in its Hong Kong IPO. In this note, we will undertake a peer comparison.

Sumeet Singh

Hang Seng Index Rebalance - FOUR Names IN, None Out (The March to 80 Continues)

The Hang Seng Index Rebalance has 4 ADDs and zero DELETEs for September on course for 80 names in March-June 2023. The two 'interesting' ADDs to me...

Travis Lundy

China Tourism Group A/H Listing - Discount Is Enticing at the Low-End

China Tourism Group Duty Free Corporation Limited (CDF) aims to raise around US$2.5bn in its H-share listing in Hong Kong. In this note, we talk...

Sumeet Singh

Giant Biogene Pre-IPO - The Positives - Fast Growth and Juicy Margins

Giant Biogene aims to raise around US$500m in its Hong Kong IPO. It is a leader in the recombinant collagen market in China.

Sumeet Singh

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