Overseas Chinese Equities, Aequitas Research

Ming Lu

Overseas Chinese Equities

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 Bottom-Up

<ul>
<li>In China, travelers grew by 13% YoY in 4Q24 and 15% in 2024, according to the National Bureau of Statistics.</li>
<li>We expect total revenue will grow by 19% YoY in 4Q24 and 2024.</li>
<li>We are confident in the company’s financial performance, but the stock price is overvalued.</li>
</ul>


In China, travelers grew by 13% YoY in 4Q24 and 15% in 2024, according to the National Bureau of Statistics.
We expect total revenue will grow by 19% YoY in 4Q24 and 2024.
We are confident in the company’s financial performance, but the stock price is overvalued.


Trip.com (TCOM) 4Q24 Preview: Rising with Travelers, But High in Stock Price

Covering IPOs, Healthcare and Technology Stocks

Andrei Zakharov

Equity Capital Markets

<ul>
<li>Klook Technology Limited, travel and leisure booking platform company with leadership position in APAC intra-regional travel, aims to raise up to $500M in US IPO.</li>
<li>The company is expected to IPO in December. Goldman Sachs, J.P. Morgan and Morgan Stanley are leading the offering and Klook will list its ADSs on the NYSE.</li>
<li>My IPO valuation analysis coalesces around initial valuation range between $2.5B and $3.5B for Klook Technology Limited upcoming offering.</li>
</ul>


Klook Technology Limited, travel and leisure booking platform company with leadership position in APAC intra-regional travel, aims to raise up to $500M in US IPO.
The company is expected to IPO in December. Goldman Sachs, J.P. Morgan and Morgan Stanley are leading the offering and Klook will list its ADSs on the NYSE.
My IPO valuation analysis coalesces around initial valuation range between $2.5B and $3.5B for Klook Technology Limited upcoming offering.


Klook IPO (NYSE: KLK): Fair Valuation Would Be Significantly Above Last Reported Valuation

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>We expect TCOM to report C4Q24 revenue 1.8% lower than consensus, mainly due to lukewarm outbound travel. But we see domestic and inbound remained robust heading into CNY. </li>
<li>Given strong data flow heading into CNY, we continue to be positive on domestic travel while outbound suffering a further setback...</li>
<li>We keep the stock as BUY rating and keep TP at US$74/ADS.</li>
</ul>


We expect TCOM to report C4Q24 revenue 1.8% lower than consensus, mainly due to lukewarm outbound travel. But we see domestic and inbound remained robust heading into CNY. 
Given strong data flow heading into CNY, we continue to be positive on domestic travel while outbound suffering a further setback...
We keep the stock as BUY rating and keep TP at US$74/ADS.


[Trip.com (TCOM US, BUY, TP US$74) Preview]: C4Q24: Thailand Kidnapping Strengthens Domestic

Quantitative Equity Analyst, DMA

Charlotte van Tiddens, CFA

Quantitative Equity Analyst

Technology-First Company

DMA is a technology-first company that provides an end-to-end SaaS solution to institutional investors. DMA enables regulated entities like asset managers, wealth managers, investment managers and financial advisors to connect their front and back office, break silos and reduce headcount.

Event-Driven

<ul>
<li>On the 17th of January, we published an insight flagging an opportunity to put on a pairs trade long Naspers, short Prosus.</li>
<li>Since the start of the year, Naspers' underperformance relative to Prosus was, in our view, overdone.</li>
<li>Naspers has outperformed Prosus by 3.98% over the last 8 trading days. We suggest closing out at current levels.</li>
</ul>


On the 17th of January, we published an insight flagging an opportunity to put on a pairs trade long Naspers, short Prosus.
Since the start of the year, Naspers' underperformance relative to Prosus was, in our view, overdone.
Naspers has outperformed Prosus by 3.98% over the last 8 trading days. We suggest closing out at current levels.


Naspers (NPN) X Prosus (PRX): Time to Close Out Pairs Trade as Discount Falls to 8.9% from 13.7%

HK/China Equity Long-Short

Osbert Tang, CFA

Tongcheng Travel Holdings  / Equity Bottom-Up

<ul>
<li>The upcoming Chinese New Year travel rush is expected to see air passenger volume reach 80m, a 9.8% increase vs. 2019. <a href="https://www.smartkarma.com/entities/tongcheng-travel-holdings-ltd" target="_blank" data-smartkarma-citation="entities:27363:1" rel="noopener">Tongcheng Travel Holdings (780 HK)</a> is a key beneficiary.</li>
<li>In addition to air ticket booking, Tongcheng can gain from demand for related services and products. The focus on lower-tier cities will make it better satisfy their demand. </li>
<li>Its FY24F PER of 15.2x is lower than sector average of 16.4x, yet 3-year EPS CAGR of 30.7% is higher. Its underperformance against <a href="https://www.smartkarma.com/entities/trip-com-group-ltd" target="_blank" data-smartkarma-citation="entities:180:1" rel="noopener">Trip.com (TCOM US)</a> can be reversed.</li>
</ul>


The upcoming Chinese New Year travel rush is expected to see air passenger volume reach 80m, a 9.8% increase vs. 2019. Tongcheng Travel Holdings (780 HK) is a key beneficiary.
In addition to air ticket booking, Tongcheng can gain from demand for related services and products. The focus on lower-tier cities will make it better satisfy their demand. 
Its FY24F PER of 15.2x is lower than sector average of 16.4x, yet 3-year EPS CAGR of 30.7% is higher. Its underperformance against Trip.com (TCOM US) can be reversed.


China

Trip.com Group Ltd. provides online travel agency services. The Company offers mobile applications, hotel reservations, flight ticketing, package tours, corporate travel management, and train ticketing services.

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

Trip.com (TCOM US)

Trip.com (TCOM) 4Q24 Preview: Rising with Travelers, But High in Stock Price

In China, travelers grew by 13% YoY in 4Q24 and 15% in 2024. We expect total revenue will grow by 19% YoY in 4Q24 and 2024. However, the stock...

Ming Lu

Klook IPO (NYSE: KLK): Fair Valuation Would Be Significantly Above Last Reported Valuation

Travel booking platform Klook Technology Limited plans to raise up to $500M in upcoming US IPO. In my insight, I discuss IPO valuation scenarios,...

Andrei Zakharov

[Trip.com (TCOM US, BUY, TP US$74) Preview]: C4Q24: Thailand Kidnapping Strengthens Domestic

TCOM expected to report slightly lower revenue due to weak outbound travel, but domestic and inbound travel remain strong. Positive outlook on...

Blue Lotus Research Institute

Naspers (NPN) X Prosus (PRX): Time to Close Out Pairs Trade as Discount Falls to 8.9% from 13.7%

To those that missed the NPN/PRX pairs trade update, Naspers has outperformed Prosus by 4.1% during the last 9 trading days. We suggest closing out...

DMA

Tongcheng Travel (780 HK): We Are Back

CNY travel rush is expected to boost air passenger volume by 9.8% vs. 2019, benefiting Tongcheng. Its focus on lower-tier cities and strong EPS...

Osbert Tang, CFA

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Trip.com (TCOM) 4Q24 Preview: Rising with Travelers, But High in Stock Price

In China, travelers grew by 13% YoY in 4Q24 and 15% in 2024. We expect total revenue will grow by 19% YoY in 4Q24 and 2024. However, the stock...

Ming Lu

Klook IPO (NYSE: KLK): Fair Valuation Would Be Significantly Above Last Reported Valuation

​Travel booking platform Klook Technology Limited plans to raise up to $500M in upcoming US IPO. In my insight, I discuss IPO valuation scenarios,...

Andrei Zakharov

[Trip.com (TCOM US, BUY, TP US$74) Preview]: C4Q24: Thailand Kidnapping Strengthens Domestic

​TCOM expected to report slightly lower revenue due to weak outbound travel, but domestic and inbound travel remain strong. Positive outlook on...

Blue Lotus Research Institute

Naspers (NPN) X Prosus (PRX): Time to Close Out Pairs Trade as Discount Falls to 8.9% from 13.7%

To those that missed the NPN/PRX pairs trade update, Naspers has outperformed Prosus by 4.1% during the last 9 trading days. We suggest closing out...

DMA

Tongcheng Travel (780 HK): We Are Back

CNY travel rush is expected to boost air passenger volume by 9.8% vs. 2019, benefiting Tongcheng. Its focus on lower-tier cities and strong EPS...

Osbert Tang, CFA

Travel booking platform Klook Technology Limited plans to raise up to $500M in upcoming US IPO. In my insight, I discuss IPO valuation scenarios,...

TCOM expected to report slightly lower revenue due to weak outbound travel, but domestic and inbound travel remain strong. Positive outlook on...