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>Anta top line outperformed competitors, both overseas and domestic brands, in China.</li>
<li>We believe all margins will be stable and EPS will rise by 41% in 2024.</li>
<li>However, we believe Anta is overvalued at the current price.</li>
</ul>


Anta top line outperformed competitors, both overseas and domestic brands, in China.
We believe all margins will be stable and EPS will rise by 41% in 2024.
However, we believe Anta is overvalued at the current price.


Anta Sports (2020 HK): Healthy in Financials, Leader in Market, But High in Price

Asian Hedge Fund Manager, Long Short Equity, Macro

David Mudd

<ul>
<li>Hong Kong is showing strong market momentum as consumer staples, consumer discretionary, healthcare and tech surge on increased momentum.</li>
<li><a href="https://www.smartkarma.com/entities/xtep-international-holdings" target="_blank" data-smartkarma-citation="entities:18118:1" rel="noopener">Xtep International (1368 HK)</a> had a good 1H24 and benefited from better consumer sentiment. Analysts are upgrading <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) on an improved outlook.</a></li>
<li>Goldman Sachs upgraded their rating on <a href="https://www.smartkarma.com/entities/bilibili-inc-83a27302-cd7d-4e6a-a1de-bcf93eb022c3" target="_blank" data-smartkarma-citation="entities:32215:1" rel="noopener">Bilibili (9626 HK)</a> , <a href="https://www.smartkarma.com/entities/bilibili-inc" target="_blank" data-smartkarma-citation="entities:26793:1" rel="noopener">Bilibili (BILI US)</a> to a BUY with improving user MAU/DAU measures and the success of its newly launched game.</li>
</ul>


Hong Kong is showing strong market momentum as consumer staples, consumer discretionary, healthcare and tech surge on increased momentum.
Xtep International (1368 HK) had a good 1H24 and benefited from better consumer sentiment. Analysts are upgrading Tongcheng Travel Holdings (780 HK) on an improved outlook.
Goldman Sachs upgraded their rating on Bilibili (9626 HK) , Bilibili (BILI US) to a BUY with improving user MAU/DAU measures and the success of its newly launched game.


BUY/SELL/HOLD: Hong Kong Stock Updates (September 28)

External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

<ul><li>The sportswear industry is still under immense pressure.</li><li>However, we are still confident in the mid to long run. Going into 2H24E, we still believe Xtep can continue its outperformance, supported by: 1) successful new products, 2) robust e-commerce sales and platform expansion, 3) relatively more wholesale business nature, 4) robust growth from the Saucony brand and 5) reduced losses after the sales of K&amp;P.</li><li>The stock’s valuation is fairly attractive, at 10x FY24E P/E and 14% FY24E yield.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

The sportswear industry is still under immense pressure.However, we are still confident in the mid to long run. Going into 2H24E, we still believe Xtep can continue its outperformance, supported by: 1) successful new products, 2) robust e-commerce sales and platform expansion, 3) relatively more wholesale business nature, 4) robust growth from the Saucony brand and 5) reduced losses after the sales of K&amp;P.The stock’s valuation is fairly attractive, at 10x FY24E P/E and 14% FY24E yield.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Xtep (1368 HK) - Better Margins Despite Cautious Sales Growth

<ul><li>The sportswear industry remains under great pressure, but we believe Xtep is still one of a few brands that can mildly outperform and improve sequentially in 2H24E, because of: 1) successful new product launches such as the 360X</li><li>2) robust e-commerce sales growth (esp. the Douyin platform)</li><li>3) wholesale business nature (therefore drags from operating deleverage is limited)</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

The sportswear industry remains under great pressure, but we believe Xtep is still one of a few brands that can mildly outperform and improve sequentially in 2H24E, because of: 1) successful new product launches such as the 360X2) robust e-commerce sales growth (esp. the Douyin platform)3) wholesale business nature (therefore drags from operating deleverage is limited)Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Xtep (1368 HK) - Cautiously Optimistic After a Resilient 2Q24

Hua Hong Semiconductor / Equity Bottom-Up

<ul>
<li>After hitting a low point in Q4 2023, Research on Hong Kong companies has been slow to pick up reflecting the ongoing skepticism from investors. </li>
<li>Reports on the large China tech companies dominated the top ten companies covered over the last couple of years and in the first half of 2024.</li>
<li>As China continues to dominate and make news in the global EV market, research in that sector has picked up.</li>
</ul>


After hitting a low point in Q4 2023, Research on Hong Kong companies has been slow to pick up reflecting the ongoing skepticism from investors. 
Reports on the large China tech companies dominated the top ten companies covered over the last couple of years and in the first half of 2024.
As China continues to dominate and make news in the global EV market, research in that sector has picked up.


BUY/SELL/HOLD: China/Hong Kong Stock Updates (July 8th)

China

Xtep International Holdings Limited designs, develops, manufactures, markets, and sells sportswear, including footwear, apparel, and accessories for adults and children. The company operates a multi-brand portfolio, featuring its core Xtep brand alongside international brands such as Saucony and Merrell. It was founded in 1987 and is headquartered in Xiamen, Fujian, China.

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Xtep (1368 HK)

Anta Sports (2020 HK): Healthy in Financials, Leader in Market, But High in Price

Anta outperformed competitors, both overseas and domestic brands, in China. We believe all margins will be stable and EPS will rise by 41% in 2024....

Ming Lu

BUY/SELL/HOLD: Hong Kong Stock Updates (September 28)

Hong Kong market continues to re-rate on the back of PBOC stimulus. XTEP and Tongcheng benefit from improved consumer sentiment and earnings...

David Mudd

Xtep (1368 HK) - Better Margins Despite Cautious Sales Growth

We have adjusted our FY24E/ 25E/ 26E net profit by 0%/ -4%/ -3% to factor in slightly slower sales growth but a much better GP margin.

CMB International

Xtep (1368 HK) - Cautiously Optimistic After a Resilient 2Q24

The sportswear industry remains under great pressure, but we believe Xtep is still one of a few brands that can mildly outperform and improve...

CMB International

BUY/SELL/HOLD: China/Hong Kong Stock Updates (July 8th)

Tech NEV companies continue to dominate the research landscape for Hong Kong coverage. Bosideng, China Water Affairs, Topsports, BYD and Xiaomi...

David Mudd

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