IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/jinke-smart-services-group-co" target="_blank" data-smartkarma-citation="entities:29214:1" rel="noopener">Jinke Smart Services (9666 HK)</a> has announced an enhanced offer from Boyu at HK$8.69, a 30.3% premium to the existing base offer of HK$6.67.</li>
<li>The enhanced offer is conditional on the shareholders’ approval of the delisting resolution and the 90% minimum acceptance condition from disinterested shareholders.</li>
<li>The 90% minimum acceptance condition could be challenging, particularly as the peers have re-rated and the enhanced offer is barely above the undisturbed price. </li>
</ul>



Jinke Smart Services (9666 HK) has announced an enhanced offer from Boyu at HK$8.69, a 30.3% premium to the existing base offer of HK$6.67.
The enhanced offer is conditional on the shareholders’ approval of the delisting resolution and the 90% minimum acceptance condition from disinterested shareholders.
The 90% minimum acceptance condition could be challenging, particularly as the peers have re-rated and the enhanced offer is barely above the undisturbed price. 


Jinke Smart Services (9666 HK): Boyu’s Enhanced Offer but with Potentially Problematic Conditions

Asian Hedge Fund Manager, Long Short Equity, Macro

David Mudd

Cross Asset Strategy

<ul>
<li><strong>Japan equity ETF flows have not recovered from the carry trade sell off.  Hong Kong Southbound Connect flows continue to be positive this month.</strong></li>
<li>
<a href="https://www.smartkarma.com/entities/qifu-technology-inc" target="_blank" data-smartkarma-citation="entities:36657:1" rel="noopener"><strong>Qifu Technology (3660 HK)</strong></a><strong> , <a href="https://www.smartkarma.com/entities/q-technology-group-co-ltd" target="_blank" data-smartkarma-citation="entities:79:1" rel="noopener">Q Technology Group (1478 HK)</a> and <a href="https://www.smartkarma.com/entities/jd-logistics-inc" target="_blank" data-smartkarma-citation="entities:31500:1" rel="noopener">JD Logistics (2618 HK)</a> all advanced on strong 2Q earnings announcements. </strong>
</li>
<li>
<a href="https://www.smartkarma.com/entities/tencent-music-entertainment-group" target="_blank" data-smartkarma-citation="entities:36601:1" rel="noopener"><strong>Tencent Music Entertainment Group (1698 HK)</strong></a><strong> disappointed on earnings and monthly user numbers.  <a href="https://www.smartkarma.com/entities/country-garden-services-holdin" target="_blank" data-smartkarma-citation="entities:27343:1" rel="noopener">Country Garden Services (6098 HK)</a> declined in anticipation of a large drop in earnings in 2Q 2024.</strong>
</li>
</ul>


Japan equity ETF flows have not recovered from the carry trade sell off.  Hong Kong Southbound Connect flows continue to be positive this month.

Qifu Technology (3660 HK) , Q Technology Group (1478 HK) and JD Logistics (2618 HK) all advanced on strong 2Q earnings announcements. 


Tencent Music Entertainment Group (1698 HK) disappointed on earnings and monthly user numbers.  Country Garden Services (6098 HK) declined in anticipation of a large drop in earnings in 2Q 2024.



The Heat Is On: News Flow and Sentiment in CHINA / HONG KONG (August 16)

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Index Rebalance

Brilliance China Automotive / Index Rebalance

<ul>
<li>We see 44 potential adds (including plenty of new listings) and 19 potential deletes (on market cap, liquidity and suspension) for the Hang Seng Composite Index in March.</li>
<li>We expect 37 stocks to be added to Southbound Stock Connect following the rebalance while 37 stocks could be deleted from the trading link and become Sell-only. </li>
<li>There are stocks that have a very high percentage of holdings via Stock Connect and there could be some unwinding prior to the stocks becoming Sell-only.</li>
</ul>


We see 44 potential adds (including plenty of new listings) and 19 potential deletes (on market cap, liquidity and suspension) for the Hang Seng Composite Index in March.
We expect 37 stocks to be added to Southbound Stock Connect following the rebalance while 37 stocks could be deleted from the trading link and become Sell-only. 
There are stocks that have a very high percentage of holdings via Stock Connect and there could be some unwinding prior to the stocks becoming Sell-only.


HSCI Index Rebalance Preview and Stock Connect: A Lot of Change

APAC IPOs & Placements

Zhen Zhou, Toh

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

SCE Intelligent Commercial Management / Equity Capital Markets

<div>
<p><a href="https://www.smartkarma.com/entities/sce-intelligent-commercial-management" target="_blank" data-smartkarma-citation="entities:33500:1" rel="noopener">SCE Intelligent Commercial Management (606 HK)</a> (SIM) raised US$238m at HK$3.70 per share, the bottom-end of its IPO price range.</p>
</div>
<div>
<p>SCE Intelligent Management (SIM) is a comprehensive property management service provider that manages commercial and residential properties in China. SIM’s contracted property management portfolio spans across 54 cities, 18 provinces, municipalities and autonomous regions in China. Properties under management include residential properties and commercial properties such as shopping malls and office buildings.</p>
<div>
<p>In this note, we will discuss deal dynamics and update valuation. </p>
</div>
<div>
<p>We covered the IPO earlier in:</p>
<ul>
<li>
<a href="https://www.smartkarma.com/insights/sce-commercial-management-ipo-still-reliant-on-china-sce-exposed-to-lower-tier-cities" target="_blank" data-smartkarma-citation="insights:53386" rel="noopener">SCE Commercial Management (中骏商管服务) IPO - Still Reliant on China SCE, Exposed to Lower Tier Cities</a> </li>
</ul>
</div>
</div>


SCE Intelligent Commercial Management (606 HK) (SIM) raised US$238m at HK$3.70 per share, the bottom-end of its IPO price range.


SCE Intelligent Management (SIM) is a comprehensive property management service provider that manages commercial and residential properties in China. SIM’s contracted property management portfolio spans across 54 cities, 18 provinces, municipalities and autonomous regions in China. Properties under management include residential properties and commercial properties such as shopping malls and office buildings.

In this note, we will discuss deal dynamics and update valuation. 


We covered the IPO earlier in:


SCE Commercial Management (中骏商管服务) IPO - Still Reliant on China SCE, Exposed to Lower Tier Cities 




SCE Commercial Management (中骏商管服务) IPO Trading - One of the Worst HKPO Sub Rate

<div><p><a href="https://www.smartkarma.com/entities/yuexiu-services-group-limited" target="_blank" data-smartkarma-citation="entities:33482:1" rel="noopener">Yuexiu Services (6626 HK)</a> raised US$232m  at HK$4.88 per share, the top-end of its IPO price range.</p></div><div>
<p>Yuexiu Services is an urban operation service provider in China with a focus on the Greater Bay Area. It manages a mix of non-commercial and commercial properties. As of December 2020, the company had 215 properties under management with about 32.6m GFA under management and about 96.1% of these GFA situated in Tier 1, New Tier 1 and Tier 2 cities. </p>
<div><p>In this note, we will discuss deal dynamics and update valuation. </p></div>
<div>
<p>We covered the IPO earlier in:</p>
<ul><li>
<a href="https://www.smartkarma.com/insights/yuexiu-services-ipo-interesting-but-not-outstanding" target="_blank" data-smartkarma-citation="insights:53160" rel="noopener">Yuexiu Services (越秀服务) IPO - Interesting but Not Outstanding</a> </li></ul>
</div>
</div>

Yuexiu Services (6626 HK) raised US$232m  at HK$4.88 per share, the top-end of its IPO price range.
Yuexiu Services is an urban operation service provider in China with a focus on the Greater Bay Area. It manages a mix of non-commercial and commercial properties. As of December 2020, the company had 215 properties under management with about 32.6m GFA under management and about 96.1% of these GFA situated in Tier 1, New Tier 1 and Tier 2 cities. 
In this note, we will discuss deal dynamics and update valuation. 

We covered the IPO earlier in:

Yuexiu Services (越秀服务) IPO - Interesting but Not Outstanding 



Yuexiu Services (越秀服务) IPO Trading - Better HKPO Demand than Central China Mgt and Roiserv

China

Yuexiu Services Group Limited provides property management services. The Company offers building maintenance, security management, and other services. Yuexiu Services Group is located in Hong Kong.

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Yuexiu Services (6626 HK)

Jinke Smart Services (9666 HK): Boyu’s Enhanced Offer but with Potentially Problematic Conditions

The 90% minimum acceptance condition could be challenging, particularly as the peers have re-rated and the enhanced offer is barely above the...

Arun George

The Heat Is On: News Flow and Sentiment in CHINA / HONG KONG (August 16)

Japan ETF flows have been light after the massive outflow from carry trade unwind. Qifu Tech, Q Tech and JDL all had positive earnings announcement...

David Mudd

HSCI Index Rebalance Preview and Stock Connect: A Lot of Change

We forecast 44 adds/19 deletes for the HSCI in March leading to 37 adds/deletes for Southbound Stock Connect. There could be more Connect changes...

Brian Freitas

SCE Commercial Management (中骏商管服务) IPO Trading - One of the Worst HKPO Sub Rate

SCE Intelligent Commercial Management (606 HK) (SIM) raised US$238m at HK$3.70 per share, the bottom-end of its IPO price range.

Zhen Zhou, Toh

Yuexiu Services (越秀服务) IPO Trading - Better HKPO Demand than Central China Mgt and Roiserv

Yuexiu Services (6626 HK) raised US$232m at HK$4.88 per share, the top-end of its price range. Yuexiu Services is an urban operation service...

Zhen Zhou, Toh

Price Gauge

52-week Range

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