HK/China Equity Long-Short

Osbert Tang, CFA

Thematic (Sector/Industry)

<ul>
<li>CSRC's Market Value Management Guidelines will indirectly benefit the H-share stocks with their A-share counterparts with a P/B of below 1x.  </li>
<li>Chinese banks dominated the list with below-book A-shares. <a href="https://www.smartkarma.com/entities/china-everbright-bank-co-ltd" target="_blank" data-smartkarma-citation="entities:16221:1" rel="noopener">China Everbright Bank (6818 HK)</a>, <a href="https://www.smartkarma.com/entities/china-citic-bank-corp-ltd-ea6c25fd-4b20-45cb-a4a6-df7a60136f03" target="_blank" data-smartkarma-citation="entities:653:1" rel="noopener">China Citic Bank H (998 HK)</a>, and <a href="https://www.smartkarma.com/entities/industrial-and-commercial-bank-of-china-limited" target="_blank" data-smartkarma-citation="entities:1119:1" rel="noopener">ICBC (H) (1398 HK)</a> are the prime beneficiaries.</li>
<li>Infrastructure construction companies <a href="https://www.smartkarma.com/entities/china-railway-construction-corp-limited" target="_blank" data-smartkarma-citation="entities:263:1" rel="noopener">China Railway Cons Corp (1186 HK)</a>, <a href="https://www.smartkarma.com/entities/china-railway-group-ltd-h" target="_blank" data-smartkarma-citation="entities:264:1" rel="noopener">China Railway Group H (390 HK)</a>, and <a href="https://www.smartkarma.com/entities/china-communications-construction-co-ltd" target="_blank" data-smartkarma-citation="entities:265:1" rel="noopener">China Comm Cons (1800 HK)</a> are also well-positioned to gain.</li>
</ul>


CSRC's Market Value Management Guidelines will indirectly benefit the H-share stocks with their A-share counterparts with a P/B of below 1x.  
Chinese banks dominated the list with below-book A-shares. China Everbright Bank (6818 HK), China Citic Bank H (998 HK), and ICBC (H) (1398 HK) are the prime beneficiaries.
Infrastructure construction companies China Railway Cons Corp (1186 HK), China Railway Group H (390 HK), and China Comm Cons (1800 HK) are also well-positioned to gain.


China & HK Strategy: Names to Watch for Market Value Management

Asia Pac IPO & Placement Research, China biotech, Aequitas Research

Ke Yan, CFA, FRM

Asia Pac IPO & Placement Research, China biotech

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.

Quantitative Analysis

<ul>
<li>We analyse the changes of A-H premium on 150 stocks over the last week. The average A-H premium was 102.8% as of Dec 6th.</li>
<li>The average A-H premium changed by -0.5ppt week-on-week, led by utilities, consumer discretionary, health care and offset by consumer staples, real estate, materials.</li>
<li>We highlight weekly changes in A-H premium for ZOOMLION, CanSinoBIO, GAC Group, Asymchem.</li>
</ul>


We analyse the changes of A-H premium on 150 stocks over the last week. The average A-H premium was 102.8% as of Dec 6th.
The average A-H premium changed by -0.5ppt week-on-week, led by utilities, consumer discretionary, health care and offset by consumer staples, real estate, materials.
We highlight weekly changes in A-H premium for ZOOMLION, CanSinoBIO, GAC Group, Asymchem.


A-H Premium Weekly (Dec 6th):ZOOMLION, CanSinoBIO, GAC Group, Asymchem

Articles from Caixin Global, Caixin Global

Caixin Global

Articles from Caixin Global

Caixin is a media group dedicated to providing financial and business news through periodicals, online content, mobile apps, conferences, books and TV/video programs. Caixin aims to blaze a trail that helps traditional media prosper in the new media age through integrated multimedia platforms.

News from Caixin

<ul><li>Chinese clean-energy companies should increasingly look to Southeast Asia for its abundant resources and growing electric-vehicle (EV) market, experts said, as their prospects in Europe dim amid tighter regulations.</li><li>Chinese companies’ overseas expansion was a key focus at the 2024 ESG and Sustainable Business Ecosystem Conference in Beijing on Friday, where entrepreneurs, investors, scholars and industry experts also explored how artificial intelligence (AI) could help China meet its dual-carbon goals, among other issues.</li><li>“Southeast Asia … has both demographic dividends and rich natural resources,” said Zheng Wendan of Singapore advisory firm Alliance For Good, at the environmental, social and governance (ESG) event, organized by Beijing-based tech firm For Good and the China Business Journal.</li></ul>

Chinese clean-energy companies should increasingly look to Southeast Asia for its abundant resources and growing electric-vehicle (EV) market, experts said, as their prospects in Europe dim amid tighter regulations.Chinese companies’ overseas expansion was a key focus at the 2024 ESG and Sustainable Business Ecosystem Conference in Beijing on Friday, where entrepreneurs, investors, scholars and industry experts also explored how artificial intelligence (AI) could help China meet its dual-carbon goals, among other issues.“Southeast Asia … has both demographic dividends and rich natural resources,” said Zheng Wendan of Singapore advisory firm Alliance For Good, at the environmental, social and governance (ESG) event, organized by Beijing-based tech firm For Good and the China Business Journal.

Southeast Asia Shines as Chinese Clean-Energy Firms’ Traditional Markets Dim  

Equity Bottom-Up

Xinjiang Goldwind Science & Technology / Equity Bottom-Up

<ul>
<li>With a massive 125% rally YTD, <a href="https://www.smartkarma.com/entities/xinjiang-goldwind-science-technology-h" target="_blank" data-smartkarma-citation="entities:10112:1" rel="noopener">Xinjiang Goldwind Science &amp; Technology (2208 HK)</a> is no longer cheap. Its yield of 3.5% for FY25 cannot stand out as attractive.</li>
<li>Good 9M24 earnings growth is partly due to an extremely low base last year. However, the average bidding price of WTG suppliers is still 50% below that in early 2022. </li>
<li>Net operating cash outflow surged 37.8% YoY, adding pressure to its balance sheet. Its gearing has increased by 7pp over the last nine months.</li>
</ul>


With a massive 125% rally YTD, Xinjiang Goldwind Science &amp; Technology (2208 HK) is no longer cheap. Its yield of 3.5% for FY25 cannot stand out as attractive.
Good 9M24 earnings growth is partly due to an extremely low base last year. However, the average bidding price of WTG suppliers is still 50% below that in early 2022. 
Net operating cash outflow surged 37.8% YoY, adding pressure to its balance sheet. Its gearing has increased by 7pp over the last nine months.


Xinjiang Goldwind (2208 HK): We Should Be More Prudent

<ul>
<li>We analyse the changes of A-H premium on 150 stocks over the last week. The average A-H premium was 103.3% as of Nov 29th.</li>
<li>The average A-H premium changed by -0.2ppt week-on-week, led by information technology, materials, real estate and offset by consumer staples, energy, health care.</li>
<li>We highlight weekly changes in A-H premium for Goldwind, GAC, Cosco Shipping Energy, Flat Glass, Shanghai Electric.</li>
</ul>


We analyse the changes of A-H premium on 150 stocks over the last week. The average A-H premium was 103.3% as of Nov 29th.
The average A-H premium changed by -0.2ppt week-on-week, led by information technology, materials, real estate and offset by consumer staples, energy, health care.
We highlight weekly changes in A-H premium for Goldwind, GAC, Cosco Shipping Energy, Flat Glass, Shanghai Electric.


A-H Premium Weekly (Nov 29th): Goldwind, GAC, Cosco Shipping Energy, Flat Glass, Shanghai Electric

China

Xinjiang Goldwind Science & Technology Co., Ltd. manufactures wind generator sets, provides consulting service in building and operating wind generating plants, builds and operates middle-sized wind generating plants.

Xinjiang Goldwind Science & Technology (002202 CH)

Price Gauge
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Xinjiang Goldwind Science & Technology (002202 CH)

China & HK Strategy: Names to Watch for Market Value Management

SASAC issued "Several opinions on improving and strengthening the market value management of listed companies controlled by central enterprises"...

Osbert Tang, CFA

A-H Premium Weekly (Dec 6th):ZOOMLION, CanSinoBIO, GAC Group, Asymchem

We analyzed A-H premium changes in the past week and highlight A-H premium changes for ZOOMLION, CanSinoBIO, GAC Group, Asymchem.

Ke Yan, CFA, FRM

Southeast Asia Shines as Chinese Clean-Energy Firms’ Traditional Markets Dim

Chinese clean-energy companies should increasingly look to Southeast Asia for its abundant resources and growing electric-vehicle (EV) market,...

Caixin Global

Xinjiang Goldwind (2208 HK): We Should Be More Prudent

Goldwind's impressive YTD rally may not be sustainable as its yield is no longer attractive, with a surge in net operating cash outflow and...

Osbert Tang, CFA

A-H Premium Weekly (Nov 29th): Goldwind, GAC, Cosco Shipping Energy, Flat Glass, Shanghai Electric

We analyzed A-H premium changes in the past week and highlight A-H premium changes for Goldwind, GAC, Cosco Shipping Energy, Flat Glass, Shanghai...

Ke Yan, CFA, FRM

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)