China

• This Insight analyses JD.com (9618 HK) option strategies traded over the last five trading days on the Hong Kong Exchange. Strategy highlights and volatility context are provided.
• Bearish strategies dominate trading activity, outnumbering bullish ones by more than 3:1, with long volatility structures and calendar/diagonal spreads being prevalent.
• Long tail events: Several strategies follow a pattern of minimal upfront cost (0.1% premium), targeting a significant payout in case of large price movements within a short timeframe. 

• The largest ETF inflows in the region have been in Taiwan as investors rush into indices that have higher dividend yields.
• China had large inflows last year as markets floundered. With markets trading in a range over the last 6 months, those flows have reversed in Q1 this year.
• Australia has seen net inflows this year, while there have been net outflows from Hong Kong, India and Japan focused ETFs.

• Innovent Biologics Inc (1801 HK) has announced 2024 result, with total revenue increasing a whopping 52% YoY to RMB9,422M and net loss narrowing 91% YoY to RMB933M.
• On adjusted basis, the company reported maiden net profit of RMB332M compared with loss of RMB515M in 2023. Innovent is expected to become profitable on reported basis this year.
• Innovent aims to achieve RMB 20B product revenue in 2027, implying a CAGR of 34% and advance five pipeline assets to the global/multi-regional Phase 3 clinical trial stage by 2030. 

• Hygeia Healthcare Group (6078 HK) reported revenue growth of 9% YoY to RMB4,446 million, mainly driven by a 11% YoY growth in hospital business.
• Hygeia’s gross profit margin contracted 170bps YoY to 29.9%. Net profit decreased 13% on higher finance cost despite of income tax expenses being lower.
• Accelerated organic growth and strengthening of margins are crucial to boost valuation.

• MNSO reported C4Q24 rev.1.6%/2.0%, and non-GAAP EBIT 3.4%/2.0% below our est./cons.. What concerns us more is the quality of the growth;
• In our view, MNSO’s slow same-store-sales-growth (SSSG), overseas investment, and Yonghui’s integration haven’t fully reflected in the price;
• We cut the TP to US$16 and maintain the SELL rating to reflect slower profit growth. The stock trades at 14x 25E P/E vs. a 12% 3 Yr. NI CAGR

• Horizon Robotics, a leading provider of integrated computing solutions for ADAS and AD for consumer vehicles, went public in October of 2024 in Hong Kong.
• The Chinese technology company priced its IPO at HK$3.99 per share and raised ~HK$5.4B or $696M. The offering was multiple times oversubscribed.
• The company’s market cap peaked at ~$18B in February and exceeded valuation of Mobileye Global. I expect a near-term selling pressure as IPO lock-up expires in April.

• Neta Auto, the Chinese electric vehicle (EV) startup, is teetering on the brink of collapse after a funding crisis brought production to a standstill and triggered mass layoffs, leaving its parent company scrambling for a financial lifeline amid rising debt.
• Hozon New Energy Automobile Co. Ltd., which produces EVs under the Neta brand, revealed in February that its much-anticipated Series E funding round had unraveled.
• Originally scheduled to close by Feb. 28 with a planned injection of 4 billion to 4.5 billion yuan ($550 million to $620 million), the deal never materialized.

• Kuaishou reported C4Q24 revenue, IFRS operating profit, and IFRS net income slightly below our estimates and consensus. Margin outperformed.
• Advertising and e-commerce revenue growth temporarily slowed from due to Kuaishou’s offering traffic subsidies to the internal merchants, reducing incentive to advertise, but will translate to revenues later;
• We cut TP from HK$72 to HK$70 to reflect lowered margin outlook due to AI-related capex and R&D expenses

• In the US, the third estimate of Q4/24 annualised US GDP inched up to 2.4% q-o-q (from 2.3% in the second estimate), mainly reflecting a downward revision to imports.
• Separately, February pending home sales rose 2.0% m-o-m (1.0% e / -4.6% p), rebounding slightly from a record low but remaining well below historical levels.
• The UST curve twisted steeper yesterday, with long-end yields rising to a one-month-high amid concerns over the impact of tariffs on US growth and inflation. 

• NIO (9866 HK) is looking to raise around US$450m via a primary placement in Hong Kong.
• The shares haven’t done much this year or ever since they were listed.
• In this note, we will talk about the placement and run the deal through our ECM framework.

• Given the slew of A/H offerings in the Hong Kong IPO pipeline, in this note, we talk about the overall A/H premiums currently.
• We also had a quick look at the past A/H listing performance, including subscription rates and A/H premiums at the time of listing.
• Overall, most of the A/H listings haven’t done much in the near term, with a few exceptions.

• Copper pricing reporter Han Lu, sulfuric acid reporter Ong Jialun, and China content reporter Lucy Tang share insights on copper market trends and trade flows
• China copper concentrates assessments have hit negative levels in 2025 due to tight supply and growing demand from China and India
• Smelters are running at production losses due to low TCRC but continue to buy in the market to meet output targets and maintain production levels

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

• Jiangsu Hengrui Medicine (600276 CH) and Merck entered into an exclusive license agreement for HRS-5346, an investigational oral small-molecule drug. The collaboration positions Merck to challenge two other pharma giants.
• Hengrui has granted Merck exclusive rights to develop, manufacture, and commercialize HRS-5346 worldwide for an upfront payment of $200M. Hengrui is also eligible to receive milestone payments up to $1.77B.
• Hengrui reported strong 19% YoY revenue growth during 9MFY25 to RMB 20B, while profits rose 6% YoY to RMB 5B. The company will report full-year 2024 result on March 31.

• Rava has enlisted Blackstone MDs to spearhead growth in Japan, highlighting their intent to expand operations in the region.
• GreenFort and Gaw have partnered to explore land lease opportunities in Australia, with a focus on showcasing their collaboration on MTD TV.
• SC Capital, based in Singapore, has successfully closed their sixth APAC fund at $900M, demonstrating their commitment to making opportunistic investments in the region.

• Meituan reported C4Q24 revenue in-line, and non-IFRS OP miss 7.9%/1.9% vs. our estimate/consensus, due to extra Opex on purchasing GPU, while core biz profitability improved.
• We see membership initiatives and enhancing O2O penetration as the main catalyst in 2025, and the downside risk on competition, social security, and overseas investment are limited.
• We rise TP to HK$196 to factor in the promising OP growth trajectory and keep as TOP BUY in China e-commerce.

• Health and Happiness’ (H&H) FY 2024 results were soft, as the company continued to report weaker earnings and margins from the Baby Nutrition & Care (BNC) business in Mainland China.
• The weakness was only partly offset by continued growth in the Adult Nutrition & Care (ANC) and Pet Nutrition & Care (PNC) segments.
• Positively, management guided for the infant milk formula business in Mainland China to improve during H1/25 (after a 25% revenue decline in FY 2024), supported by completion of the transition to new Guobiao regulatory standards as well as continued market share gains.

• ENN Energy (2688 HK) announced a pre-conditional privatisation from ENN Natural Gas (600803 CH)/ENN-NG comprising HK$24.50 cash per share + 2.9427 ENN-NG H Shares per ENN share.
• The appraised offer value is HK$80.00 (HK$82.35, including the 2024 dividend), which is a tad optimistic. My calculations suggest a realistic offer value range of HK$71.47-76.32. 
• The offer is final. The precondition satisfaction is low-risk. A high AGM minority participation is a risk, but the scheme vote should pass as the offer terms are reasonable.   

• Janaghan Jeyakumar, CFA put out June rebal predictions on HSCEI, HSTECH, and Hang Seng Internet & Infotech on 17-Mar-25 (and 7 mainland indices 19-21 March) and…
• …the Quiddity team put out its regular predictions of all 7 major HS indices and 11 mainland indices, but on 21-March after the close, the Hang Seng team updated methodology.
• They changed the way float is calculated for Secondary Listings in Hang Seng indices. It affects only a few names, but this adds US$2.7bn of buying to three names.

• This Insight analyses Alibaba Group Holding (9988 HK) multi-leg option strategies traded over the last five trading days on the Hong Kong Exchange. Strategy highlights and volatility context are provided.
• These traders tailor structures to risk budgets and take calculated bets. With implied volatility below its median and below realized volatility, all strategies reviewed are long volatility.
• Almost 20% of all strategies are Calendar or Diagonal Spreads. Diagonal spreads can even earn premium in the current volatility environment. A live strategy is examined.

• The proposed privatisation price for ENN Energy (2688 HK) appears reasonable, which is estimated to be 1.73x P/B and 11.5x PER on a 12-month forward basis. 
• The valuations are both at a good premium over the average since 2024. ENN Energy is also being put at the top of the sector’s PER range. 
• Scheme shareholders will hold new H-shares of ENN Natural Gas (600803 CH), which historically has a more volatile earnings record, but its A-share has been doing well. 

• As reported by Travis Lundy , the Hang Seng Index (HSI INDEX) Committee changed the way float is calculated for Secondary Listings in Hang Seng indices.
• This action is expected to add US$2.7bn of buying to some names- read Travis Lundy’s insight for more details on this.
• The HSI INDEX is currently down 3 weeks, and quite OVERSOLD, buying the dip, at this point makes a lot of sense.

• ENN Natural Gas has made a pre-conditional proposal to privatise ENN Energy (2688 HK). For each ENN share, shareholders will receive 2.9427 ENN Natural Gas shares and HK$24.5 in cash.
• The ENN Natural Gas H-shares will be listed on the HKEX. The value received by ENN Energy shareholders depends on ENN Natural Gas stock performance and the H-share discount.
• The ENN Natural Gas (600803 CH) H-shares are likely to replace ENN Energy (2688 HK) in global indices and the Hang Seng Index (HSI INDEX). 

• Chinese EV giant BYD has kicked off 2025 with an aggressive push that’s shaking up the global electric vehicle landscape.
• From launching EVs that can charge in just five minutes to a soaring share price and record sales, BYD is not just catching up with Tesla — it’s pulling ahead on nearly every front.
• In recent weeks, BYD’s stock surged to a record high following the announcement of its ultra-fast-charging Super e-Platform.

• PDD Holdings, Inc. presented its financial results for the fourth quarter and full fiscal year of 2024, showcasing a strategy focused on high-quality development and ecosystem advancement.
• The company reported stable financial performance in the last quarter, closing with a revenue increase to RMB 110.6 billion, a 24% year-over year gain.
• For the entire year, revenues climbed 59% to a total of RMB 393.8 billion, marking a moderation from previous growth rates.

• While Shenzhen International (152 HK)‘s FY24 result is at the low end of the positive profit alert range, its 2H24 net profit has still grown by 22.7%. 
• Better outlook at Shenzhen Expressway (548 HK) and margin improvement for logistics hubs will drive FY25. Upside will come from further gains at South China Logistics Park. 
• SZI’s valuations of 5.9x PER, 8.4% yield, and 0.5x P/B for FY25F are attractive. As more deals are sealed to realise its asset value, its P/B discount will narrow.

• China Construction Bank H (939 HK) / China Construction Bank (601939 CH) is scheduled to report its annual 2024 financial results on 28 March 2025, 17:00-18:15, Beijing time.
• Expected Price Movement: Option implied movement and historically recorded movement both indicate muted price action after earnings.
• Dividend Outlook: CCB has switched to semi-annual dividends, with current yields at 6.4% for H shares and 4.7% for A shares. The bank has a history of dividend increases.

• There have been 14 new listings on the Main Board of the HKEX in Q1. One listing is a transfer from the GEM Board and one is a De-SPAC.
• Of the 14 stocks, we see Mixue Group (2097 HK), Guming Holdings (1364 HK) and Bloks Group (1850960D CH) as potential HSCI inclusions in June.
• There are no lock-up expiries in the stocks ahead of inclusion in Southbound Stock Connect and the low float could take the stocks higher ahead of the index inclusion announcement.

• Kuaishou (KS)’ operating margin improved to 10% in 2024 versus 4% in 2023.
• Online marketing revenue increased by 20% and GMV increased by 17% in 2024.
• We conclude an upside of 104% for the next twelve months.

• Henlius has made a profit for the second year in a row.However, some investors are not satisfied with the quality of net profit growth in 2024 due to concerns behind.
• The implementation of H Share Full Circulation has a positive impact on financing ability, shareholder returns, market valuation of Henlius.The next goal is to be included in HK Stock Connect
• Lin Lijun’s continuous increase in Henlius holdings is an important reason for shares surge after privatization failure.Lin may keep pushing up share price so as to exit at higher price.

• Bank Of China Ltd (H) (3988 HK) /Bank of China (601988 CH) is scheduled to report its annual 2024 financial results on 26 March 2025, after market close.
• Expected Price Movement: Option implied movement is above the historically recorded movement.
• Implied Volatility, Options Strategies and Dividends: Discussion of implied volatility term structure and option strategies. Dividends are now semi-annual.

• Kunlun Energy (135 HK)‘s net profit grew 7.9% in 2H24, accelerating from 2.6% in 1H24. It is encouraging to see the dividend payout ratio increase by 2pp YoY.
• An increase in the adoption of the residential price linkage system is positive for the dollar margin, while the distortion from E&P expiry will no longer impact earnings. 
• With net cash equals HK$2.56/share, or 31% of the share price, such financial strength is unmatched by peers. Its PER valuations are also inexpensive.

• Duality Biotherapeutics, a China-based clinical-stage biotechnology company, plans to raise up to US$250m via a Hong Kong listing.
• We looked at the latest prospectus and noted it toned down the language and strengthened its team.
• We also compare the clinical readings of its core products with benchmark products.

• In today’s Morning Views publication we comment on developments of the following high yield issuers: China Water Affairs, Xiaomi Corp, Nickel Industries
• In the US, Atlanta Fed President Raphael Bostic said he anticipates only one interest rate cut this year, as he now thinks “we’re going to see inflation be very bumpy and not move dramatically and in a clear way to the 2% target”.
• Mr Bostic currently projects that inflation will return to the central bank’s 2% target at some point in early 2027, in line with the Fed’s projections published last week.

• Warburg Pincus and Wide Creek JV have acquired GreenFort, a Korean logistic asset, marking their second investment in the country.
• Gaw Capital is set to discuss a joint venture with MTD TV for the development of 1,200 homes in an upcoming interview on Wednesday.
• Mitsubishi Estate has sold its stake in a Shinjuku office tower to a J-REIT for $190 million, continuing its strategic real estate transactions.

• 111 chalks up its first annual operating profit despite challenging market.
• Seven years after launching its B2B operations, 111 delivered its first annual operational profit and positive operating cash flow.
• Ironically, this has happened in a year in which China’s healthcare system has been up against significant headwinds. 

• Combined January-February activity indicates demand growth continues to slow down
• Similarly, capacity restoration & load factors on outbound flights appear to have stagnated 
• We expect shares of Chinese airlines to continue to outperform travel platform Trip.com

• Xiaomi Corp (1810 HK) is looking to place 750m shares at a price range of HK$52.8-54.6/share, a 4.2-7.4% discount from last. That could raise up to HK$40.95bn (US$5.27bn).
• There will be limited passive buying near-term. There will be more passive buying at the end of May. Then there will be passive selling early June.
• Shorts will be hurting from the relentless move higher in the stock and there could be short covering if the stock moves lower from these levels.

• Xiaomi Corp (1810 HK) is looking to raise around US$5.3bn via selling 3% additional shares.
• The shares have done exceedingly well this year and are now trading at their all time highs.
• In this note, we will talk about the placement and run the deal through our ECM framework.

• China announced game approval for the March batch. The number of games approved remained at a higher level than 2023.
• The pace of China game approval appears to have accelerated to the same level as pre-tightening. We see pick up in approval rate this month.
• Both Tencent and Netease received approval for one game. In addition, Kingsoft received approval for its legendary Sword Heroes series.

• BYD (1211 HK) posted a record 2024 net profit of 40.25B yuan ($5.55B) as revenue surged 29% to 777B yuan ($107.2B), beating analyst forecasts of $5.47B and $105.6B.
• Notably, BYD’s revenue topped Tesla’s $97.7B reported on Jan. 30. The Chinese automaker is now among the biggest in the world.   
• On March 4, our BYD’s insightcorrectly suggested to BUY the stock below 340 (now trading above 400). This insight will try to determine profit targets for the current rally.

• Hansoh Pharmaceutical Group (3692 HK) reported 33% YoY net profit growth to RMB4.4B on 21% YoY revenue growth to RMB12.3B in 2024. Oncology revenue jumped 32% YoY to RMB8.1B.
• Revenue from innovative drugs zoomed 38% YoY to RMB9.5B and its proportion to total revenue increased to 77.3% in 2024 from 67.9% in 2023.
• In 2024, three key innovative drug candidates entered the phase 3 clinical stage for the first time. Hansoh will continue to focus on R&D of innovative drugs and internationalization strategy.

• Market is seeing an uptick in CNY fixing, potentially halting the DXY bear trend temporarily
• Investors are focused on upcoming tariff event risk on April 2, leading to de-risking behavior
• Various potential scenarios for tariff implementation and FX response, with uncertainty around delivery and impact of tariffs on different sectors and countries

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

• Nanshan Aluminium International Holdings (NAI HK) , raised around US$302m in its Hong Kong IPO.
• It is a leading high-quality alumina manufacturer in Southeast Asia.
• We have looked at the company’s past performance and valuations in our previous notes. In this note, we will talk about the trading dynamics.

• In today’s Morning Views publication we comment on developments of the following high yield issuers: MGM China, Genting Berhad, Road King, Meituan, AAC Technologies
• In the US, Chicago Fed President Austan Goolsbee said that the inflation impact from tariffs could be transitory, if the duties are limited in scope and there is no retaliation from other countries.
• He added that the Fed is taking a wait-and-see approach for now, albeit he believes rates will be lower 12-18 months from now if inflation remains contained in the long run. Separately, New York Fed President John Williams expressed support for the Fed’s rate pause last week, stating that “the current modestly restrictive stance of monetary policy is entirely appropriate given the solid labour market and inflation still running somewhat above our 2% goal”.

• LXJ International Holdings Limited (LXJIH) is looking to raise at least US$100m in its upcoming Hong Kong IPO.
• As a market leader in the Chinese-style QSR market in China, LXJIH was focused on its self-operated restaurant model for expansion but has recently ramped up its franchise business.
• Post-COVID, LXJIH’s margins have bounced but if LXJIH continues to expand its franchise business while converting self-operated restaurants, there might be pressure on revenue growth and margins going forward.

• We believe the stock’s upside is very limited after two buy rating this year.
• In 2024, total revenue grew by 29% and total automobile sales grew by 41%.
• The gross margin of automobile improved more than one percentage point.

• Hang Seng Indexes has announced a change in the FreeFloat-Adjusted Factor (FAF) methodology for Secondary Listings that will be implemented from the next rebalance in June.
• NetEase (9999 HK), Baidu (9888 HK), Trip.com (9961 HK), NIO (9866 HK), New Oriental Education & Techn (9901 HK) and Weibo (9898 HK) benefit; GDS Holdings (9698 HK) loses out.
• The FAF changes along with capping changes will result in a round-trip trade of HK$34.2bn (US$4.4bn) at the June rebalance with the largest turnover for the Hang Seng TECH Index. 

• In 4Q24, Meituan’s revenue growth rate was 20% YoY with all businesses rising.
• The operating margin improved to 8.8% in 4Q24 versus about zero in 4Q23.
• We set an upside of 61% and a price target of HK$270. Buy.

• AH Premia continue to fall. Spread curve torsion was a barbell this week. Narrow and wide spreads see Hs outperform. Middling spreads outperform less.
• To me, warning signs are flashing on spreads. They are at their narrowest in 5yrs and they are volatile, though volatility is coming down.
• Lots of spreads see the HA premium less than 15%. That is historically tight.

• We summarise the latest spreads and newsflow of merger arb situations we cover across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Philippines, Thailand and Chinese ADRs.
• Highest spreads: Seven & I Holdings (3382 JP), OneConnect Financial Technology (OCFT US), Insignia Financial (IFL AU), Smart Share Global (EM US), Soundwill Holdings (878 HK).
• Lowest spreads: Makino Milling Machine Co (6135 JP), Shibaura Electronics (6957 JP), Domain Holdings Australia (DHG AU), Tonami Holdings (9070 JP), PointsBet Holdings (PBH AU).

• A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
• ECM developments: DN Solutions (298440 KS) seeks to raise US$1.1 billion in a KRX IPO.
• Event-Driven developments: CK Hutchison Holdings (1 HK), Canvest Environmental Protection Group (1381 HK), ENN Energy (2688 HK), HKBN Ltd (1310 HK), Shandong Fengxiang (9977 HK), Spartan Resources (SPR AU). 

• Given new policy recommendations, it is only a matter of time before HPV vaccination is included in the national immunization program, which is detrimental to HPV vaccine companies.
• MNCs have seen a inflection point in performance growth in 2024 in China. Although VBP/NRDL negotiation are negative factors, is it also due to any consideration to withdraw from China?
• Fosun Pharma has agreed to sell its entire stake in United Family Healthcare to Calcite Gem Investments Group for US$124.1 million. We shared our views about the deal.

• China Merchants Port (144 HK) may potentially play a role in CK Hutchison Holdings (1 HK)‘s port portfolio disposal should the mainland government want to step in. 
• While CMPH’s size is small relative to the port portfolio, its parent China Merchants Group and sister China Merchants Bank H (3968 HK) can easily facilitate such a transaction.
• Having the portfolio in the hands of mainland company is desirable to the Chinese government. Even if CMPH has no role, its 7.6x PER and 6% yield are attractive.

• On the 18th June 2024, PC Partner (1263 HK)‘s board said it was considering an SGX listing, by way of introduction, and applying for the withdrawal of the HKEx listing.
• A 30th August 2024 announcement provided clarity on a step-by-step approach for the HKEx withdrawal. A secondary listing on the SGX was established on the 15th November.
• The next step is to establish a dual-primary listing in Singapore. Then withdraw the HKEx listing. The key driver behind this exercise is ensure the uninterrupted supply of NVIDIAs GPUs.

• Most key P&L items and revenue drivers improved Y/Y and sequentially vs Q324
• Although GTV per transaction dipped slightly, estimated “take rate” improved in Q424
• Strong OpCF obviates need for quick FY25 IPO — but it could still happen this year

• Jiangsu Zenergy Battery Technologies (JSZENERGY CH) (Zenergy) is looking to raise up to US$300m in its upcoming HK IPO.
• Zenergy is an EV and energy storage system battery manufacturer providing integrated battery solutions, encompassing battery cells, modules, packs and battery management systems dedicated to large-scale applications of electrochemical products.
• In this note, we talk about the positive aspects of the deal.

• Tencent reported C4Q24 revenue, IFRS op. profit, and IFRS net income in-line, (5.3%), 6.0% vs. our est. and 2.1%, (12.6%), 5.3% vs. cons. 
• We shifted our game TOP PICK from Tencent to NetEase on January 16 2025, due to pipeline gaps. 
• We reiterate our BUY rating and raise TP to HK$545 on Tencent. We expect game pipeline to fill the gap with the launch of two blockbusters in C3Q25.

• Gross SOUTHBOUND volumes dropped again somewhat but still high at HK$619bn. NET buying by SOUTHBOUND was HK$23bn which is much smaller than the last several weeks.
• The flows here are still striking and net to buy. There has to be institutional buying. And I assume it is to get the earnings yield and div pickup. 
• Included is a summary of important China Stocks-relevant news as I saw it this week.

• Xiaomi Corp (1810 HK) significantly beat Q4 2024 earnings expectations, yet the stock showed minimal price movement with just a 1.0% gain immediately after the announcement.
• Post-Earnings implied volatility declined substantially from 72% pre-earnings to below 53.4% after earnings, confirming pre-announcement predictions of overpriced volatility.
• Straddle positions were actively traded around the earnings event. A case study showcases a profitable short straddle strategy.

• The Hong Kong earnings season enters its final week with at least 17 Hang Seng Index companies reporting their 2024 results and announcing dividends.
• The proportion of companies reporting in the coming week and the week after is significant at an index level, with notable weightings in the HSI, HSCEI, and HS TECH indices.
• Opportunities to profit from price movement around earnings are manifold and include event-focused trading, statistical arbitrage, hedging, and capitalizing on changes in dividends and implied volatility.

• Price momentum remains very weak, and spot rates are already below 2024 lows
• Multiple deep-sea carriers have recently guided to a collapse in core earnings in 2025
• USTR / MARAD proposed rule changes could add to US tariff chaos & raise carriers’ costs

• The CSI Medical Index represents the top 50 largest and most-liquid stocks involved in medical devices, medical care, medical informatization, and other medical themes in China.
• In this insight, we take a look at the potential ADDs and DELs leading the race for the semiannual index rebal event in June 2025.
• We expect up to three ADDs and three DELs in June 2025 based on the latest available data (where 90% of the reference period is complete).

• Beike reported C4Q24 revenue beat our estimate/consensus by 8.4%/7.4%, non-GAAP OP miss our estimate/consensus by 37.5%/21.6%, due to front-loading expansion cost.
• We expect Beike to take 2-3ppt of market share in a rebalancing property market in 2025. 
• We keep the stock as BUY and keep TP at US$25.

• The ChiNext index represents the performance of the 100 largest and most liquid A-share stocks listed on the ChiNext Market of the Shenzhen Stock Exchange.
• The ChiNext 50 index is a subset of the ChiNext index and it consists of the top 50 names in the ChiNext index with the highest daily average turnover.
• We see 9 changes for the ChiNext index and 5 changes for the ChiNext 50 index in the next index rebal event in June 2025.

• STAR 50 Index is a tech-focused, blue-chip index in Mainland China which tracks the top 50 largest and most liquid names in the STAR market of the Shanghai Stock Exchange.
• STAR 100 index tracks the next 100 names (51st-150th ranks) and it represents the mid-cap segment of the STAR market.
• In this insight, we take a look at the potential ADDs/DELs for the STAR 50 and STAR 100 indices for the June 2025 index rebal event.

• ENN Energy (2688 HK), a major clean energy distributor based in China, is currently suspended pursuant to the Takeovers Code
• The largest shareholder is ENN Group (34.28% of shares out), an entity controlled by founder Wang Yusuo and his wife, Zhao Baoju. 
• ENN Energy is a US$8.5bn market cap company. It’s possible ENN Group make an Offer. But more likely, I’d expect an Offer from a (larger) third party.

• The largest REIT in Asia, with enough liquidity for most funds. Has a great set of neighborhood malls across Hong Kong enjoying recurring income from food & beverage, restaurants, etc
• Suffered during the COVID-19 pandemic but DPU has started growing again. Rights issue a misstep but the leverage is now acceptable. New Blackrock CIO bodes well for M&A. 
• REIT trades at 7% yield vs 4% historically. Essentially an interest rate bet. Will probably be included in the Stock Connect program soon, expect an announcement on 19 April. 

• PDD’s total revenue grew by 24% YoY in 4Q24, with advertising up by 17% YoY and commission up by 33% YoY.
• The gross margin declined YoY, but we still believe PDD has advantage in the low price market.
• We conclude an upside of 71% and a price target of US$215 for the next twelve months.

• Total revenue increased by 34% and total sales volume increased by 32%.
• The operating margin improved to 4% in 2024, compared to 2% in 2023.
• We conclude an upside of 51% and a price target of HK$28.00. Buy.

• Digital Realty partners with Bersama to enter Indonesia’s data center market, expanding their global presence in the industry.
• Leading firms KKR, Gaw, and Alyssa highlight favorable macroeconomic factors driving growth in Japan’s multi-family sector on MTD TV.
• Singapore’s largest REIT, CapitaLand, undergoes a leadership reshuffle with the appointment of a new CEO to drive strategic initiatives.

• Q424 revenue growth & EBITDA margin both improved noticeably vs Q324 
• Additionally, ZTO gave FY25 parcel volume guidance that implies an acceleration of growth
• But “key” change in revenue mix is crushing cash returns (Q424 OpCF down -28% Y/Y)

• A detailed analysis of the earnings implied jump in Kuaishou options compared to historical outcomes.
• Pre- and post-earnings price movements are examined to assess directional tendencies and magnitude.
• We find that returns heading into and after earnings have shown a strong bias.