China

• Technology platform play Ingdan (400 HK) is moving ahead, again, with the spin-off and listing of 72.42%-held Shenzhen Comtech in the PRC. 
• The listing – should it go ahead, as the previous attempt was abandoned – is expected to involve the issuance of new shares. Ingdan will maintain a stake in Comtech. 
• Comtech accounted for 95% of Ingdan’s revs in the 1H25. Expect the market to heavily discount Ingdan’s stub ops, and Ingdan’s NAV post spin-off. 

• Solid Q3 and 9M FY25 Financial Delivery: Despite challenging market conditions in China, Haier Smart Home (6690 HK) delivered solid third-quarter results reinforcing company’s strategic positioning and operational execution.
• Operational Efficiency and Mix Upgrade: The company continued to benefit from digitalised manufacturing, supply-chain optimisation, and higher contribution from high-end segments, supporting EBITDA and net profit resilience despite macro softness
• Strategic Focus Driving Sustainable Growth:Emphasis on Smart Home ecosystem expansion, global penetration, and disciplined capital allocation reinforce its competitive positioning and sets the foundation for sustained earnings momentum into FY26.

• Busy Ming Group, a founder-led food and beverage chain retailer in China with strong presence in third- and lower-tier cities, filed the updated Application Proof in October.
• In the six months ended Jun-25, the company’s revenue was ~RMB28,124m, representing a year-over-year growth of ~87%. LTM net profit was ~RMB2,025m.
• Busy Ming Group enjoys superior growth profile coupled with improving gross profit margins. The company ended Aug-25 with RMB3,393m net cash on the balance sheet.  

• Suzhou Novosense Microelectron (688052 CH), an analog chips producer, aims to raise around US$500m in its H-share listing.
• According to Frost & Sullivan, in terms of revenue from analog chips in 2024, SNM ranked fifth among Chinese analog chip companies in the Chinese analog chip market.
• In this note, we look at its past performance and other deal dynamics that might impact the listing.

• JD Industrial Technology is now looking to raise about US$500m in its upcoming HK IPO.
• JDI is a leading industrial supply chain technology and service provider in China in terms of GMV in each year during the Track Record Period, according to CIC.
• We have looked at the company background and refiling updates in our previous notes. In this note, we will talk about the refiling updates.

• Artificial Intelligent Interconnection Technology (AII HK)  (AIIT) is looking to raise about US$200m in its upcoming Hong Kong IPO. The deal will be run by CITIC and CCB International.
• Artificial Intelligent Interconnection Technology (AIIT) is a provider of AI technology, products, and spatial intelligence solutions in China, with a particular strength in high-precision AI-based urban traffic management.
• Its solutions combine hardware, software, and scenario-derived datasets to deliver full-stack AI systems that improve traffic efficiency, safety, and the management of public spaces.

• Vanke Property Overseas serves as the international asset management and property development arm for its parent, China Vanke, focusing on prime global cities but facing significant headwinds from the broader Chinese real estate crisis.
• The company’s financial performance shows a concerning trend, with a sharp decline into a net loss in the latest reported year despite revenue growth, alongside collapsing margins and a reduced dividend, reflecting severe market pressures.
• Valuation appears distressed, with a very low price-to-book ratio; however, high uncertainty in the Chinese and Hong Kong property markets, coupled with negative profitability and growth trends, suggests significant risks for investors.

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• FAK inhibitors’ R&D is not smooth.The breakthrough in FAK clinical protocol lies in the possibility of finding new application scenarios, such as the potential for combination with various anticancer drugs.
• If ifebemtinib can be successfully approved for 2-3 core indications (e.g. PROC, NSCLC) and enter medical insurance smoothly, its sales peak in the China market may reach RMB2-3 billion.
• Post-Money valuation after Series C Financing was USD306 million. The issuance valuation of InxMed may be given a certain premium on top of Series C valuation, such as US$350-500 million.

• In F2Q26, pro forma revenue increased by 18% YoY excluding two disposals.
• It was successful that the company rebranded its food delivery business.
• However, the rebranding brought significant sales and marketing expenses in F2Q26.

• JD Industrial Technology (2231713D CH), a leading industrial supply chain technology and service provider in China, is seeking to raise US$500 million.
• JDI is the largest industrial supply chain technology and service provider in China in terms of GMV, customer coverage and SKU offerings in 2024, according to CIC.
• The investment case is bearish due to weak market share gains, declining product revenue growth, margin pressures, declining cash generation and factoring of receivables. 

• CICC (3908 HK)‘s announced merger with Dongxing Securities (601198 CH) and Cinda Securities (601059 CH) will elevate it to the 3rd largest HK-listed Chinese securities company.
• Based on our assumptions, its EPS will be diluted by 7.1%, BPS enhanced by 12.2%, and ROE lowered by 1pp for FY26, before accounting for synergy.
• Its presence in Fujian (+616.7%), Liaoning (+500%), and Beijing (+100%) will be significantly enlarged. Additionally, it will open up potential benefits from optimisation.

• Vertically integrated Inner Mongolia smelter with second-quartile cost positioning, expanding renewables and alumina self-sufficiency, and entering overseas low-carbon production via its Saudi project.
• FY24 margins inflected sharply; mid-cycle valuation implies material upside with strong sensitivity to aluminium pricing and structural demand drivers including AI datacentres, EVs, and grid expansion.
• Base-Case Target Price HK$18.6 (24% upside); bull-case HK$22.1; bear-case HK$16.9, supported by integrated operations and medium-term EBITDA expansion potential.

• Yum China Holdings Inc., a licensee of Yum!
• Brands in China, presented mixed results in the third quarter of 2025.
• On a positive note, Yum China reported a record $400 million in adjusted operating profit, marking an 8% increase year-over-year.

• Lemo can replicate on a large scale through offline outlets to reduce operating costs.But this model is characterized by heavy assets, with a single profit model of limited risk resistance.
• Insufficient rigid demand is a major challenge for the industry.The declining revenue growth reflects the ineffective business expansion of Lemo, and the Company may have already encountered a growth ceiling. 
• Valuation of Lemo would be lower than peers due to the concerns of business expansion and slowing revenue. For example, 12-15x P/E may provide more safety margin for investors.

• Zhihu is a leading online content community in China, evolving from a Q&A-inspired platform to a comprehensive content ecosystem. Its primary revenue streams include paid memberships, marketing services, and vocational training.
• The company is increasingly focusing on leveraging artificial intelligence to enhance content creation, distribution, and monetization. Recent developments include the launch of an AI-powered search feature called ‘Zhida’ to provide direct answers by synthesizing existing content.
• While facing challenges in achieving consistent profitability and navigating a competitive and regulated market, Zhihu has demonstrated progress in narrowing its non-GAAP operating losses and is aiming for full-year non-GAAP breakeven.

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• Alibaba will announce Q2 earnings on after the market close (HK time) November 25.
• Earnings implied jump pricing is similar to the last release, but recent downside skew in past Q2 moves highlights why traders may focus more on potential weakness.
• Recent market patterns, including muted reactions to beats and sharp responses to misses, add weight to risks around Baba’s earnings day move.

• Meitu’s business model is not threatened by new AI image generation models. Long-term positioning remains intact. Last-mile workflows, a seventeen-year aesthetic dataset, and stable founder-led execution sustainable clear Moats.
• Overseas markets offer materially higher pay-ratios and ARPU. Productivity and e-commerce tools drive the mix shift toward high-margin growth. Both support multi-year revenue compounding independent of AI capex cycles.
• Recent Correction due to AI substitution fears drove the multiple to ~27x, placing PEG below 1x on 30% CAGR. Long-term buy with 100% upside and potential for strong re-rating.

• The company’s decision to de-emphasize Freight Brokerage Services undermined Q3 results
• The rest of the company’s reporting segments performed well in all respects
• Look for opportunity to buy YMM shares at US$9/ADS or better

• CSPC Pharmaceutical Group (1093 HK) 9M25 revenue dropped 12% YoY as finished drugs witnessed decrease on VBP and NRDL inclusion. Bulk products and license fees compensated to an extent.
• Pressure on revenue will continue to be felt. Newly launched products, pipeline strength and out licensing opportunities would help ward off the effects of lower revenues from finished drugs.
• CSPC Pharmaceutical aims to expand into the high-end market to achieve competitive differentiation and thereby command higher prices. Pivotal data read outs awaited.

• Xiao Noodles’ advantage doesn’t come from a single product, but from a set of replicable systematic capabilities.However, investors are concerned growth is driven by capital rather than endogenous healthy growth.
• Valuation would be lower than those mature brands that have proven profitability in the short term, but would be higher than the companies that are still exploring profit paths.
• Comfortable valuation could be P/E of 15-20x, which indicates arbitrage space. But in long term, business model will be difficult to sustain if there’s no breakthrough in profit margin performance.  

• HK$100bn a day of gross SOUTHBOUND activity with US$600mm+ of net buying on average. Net flows continue to be impressive. SOEs/Energy/Financials dominate.
• Watch for news on the Dual Counter (RMB) Trading eligibility for SOUTHBOUND near-term. That could up the pace of things.
• The data tables below update on a daily basis in the Tools section of Smartkarma. The Southbound Flow Monitor and AH Pairs Monitor are both there – free – for all SK readers.

• China Hongqiao, Innovent Biologics and Yum China replace ENN Energy, Haidilao International and New Oriental Education in the Hang Seng China Enterprises Index (HSCEI INDEX) in December. All changes are in line.
• Estimated one-way turnover at the rebalance is 4.6% resulting in a round-trip trade of HK$6.3bn (US$811m). The final capping will use the close of trading on 2 December.
• Innovent Biologics is also an add to the Hang Seng Index (HSI INDEX). The passive buying will absorb some stock from the recent placement in China Hongqiao. 

• Following two periods of profitability, Innovent Biologics Inc (1801 HK) will be added to the Hang Seng Index (HSI INDEX) at the close on 5 December.
• Innovent Biologics Inc (1801 HK) is also an add to the Hang Seng China Enterprises Index (HSCEI INDEX) in December, so this inclusion increases the flow and impact.
• Estimated one-way turnover is 2.3% and the estimated round-trip trade is HK$9.2bn (US$1.2bn). Big capping outflows for Alibaba (9988 HK) at the December rebalance.

• I 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: Smart Share Global (EM US), Dongfeng Motor (489 HK), AUB Group Limited (AUB AU), ENN Energy (2688 HK), Digital Holdings Inc (2389 JP), Jinke Smart Services (9666 HK). 
• Lowest spreads: Bright Smart Securities (1428 HK), Mandom Corp (4917 JP), Pacific Industrial (7250 JP), Toyota Industries (6201 JP), Seven West Media (SWM AU), Star Micronics (7718 JP). 

• Context: Over the past five trading days, Xiaomi (1810 HK) multi-leg option strategies showcased a variety of approaches. Strategy highlights are provided.
• Highlights: 55% of strategies exhibit a bullish bias, with diagonal spreads accounting for 25% of all trades.
• Why read: This breakdown of complex option strategies sheds light on market sentiment and positioning. Detailed examples provide actionable insights that could inspire similar strategies,

• We think Wharf REIC, which owns luxury malls in Hong Kong, is undergoing a structural de-rating, on the back of macro headwinds, currency impact and company fundamentals
• Southbound consumption into Hong Kong has weakened deeply, catalyzed by a punitive USD-pegged Hong Kong Dollar (HKD) and a collapsing Japanese Yen (JPY)
• In latest interim results, Wharf REIC reported HK$5.1 billion revaluation deficit and a HK$2.4 billion net loss, representing negative rental reversions crystallizing into lower asset values.

• Hs underperformed As on average by 1.88% within the liquid AH pair universe. Defensive Hs outperform As. Others not.
• Nine new recos last week. The one labelled saw H underperform A by 2%. Ouch. 15+ new trades this week.
• The data tables below update on a daily basis in the Tools section of Smartkarma. The Southbound Flow Monitor and AH Pairs Monitor are both there – free – for all SK readers.

• A tactical snapshot of the Asian indices and stocks we cover.
• Many Asian stocks we track are flashing very oversold signals—creating tactical long setups worth considering.
• We find no overbought stocks or indices in Asia at present. US equities are aligned with this view, this is a global market pullback, probably about to end.

• Transition to AI-Driven Subscriptions Fueling Growth: Meitu is successfully transitioning its business model from advertising to a high-margin, AI-driven subscription service for its photo, video, and design products. This strategic shift is the primary driver behind significant revenue and profit growth, with paying subscribers reaching 15.4 million.
• Strategic Divestment from Cryptocurrency: The company has fully divested its cryptocurrency holdings, realizing a substantial net gain of nearly US$80 million. This move de-risks the balance sheet from the volatility of digital assets and allows management to refocus capital and attention on its core AI imaging business.
• Expanding Global Footprint and Enterprise Solutions: Meitu is aggressively expanding its international user base, which now accounts for 35% of total Monthly Active Users (MAUs). Concurrently, it is leveraging its core AI technology to launch productivity-focused tools for e-commerce and advertising, opening new avenues for enterprise revenue.

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• Context: Over the past five trading days, Tencent (700 HK) multi-leg option strategies showcased a variety of approaches. Strategy highlights are provided.
• Highlights: Market sentiment is evenly balanced between bullish and bearish strategies, with diagonal spreads accounting for 25% of all trades.
• Why read: This breakdown of complex option strategies sheds light on market sentiment and positioning. Detailed examples provide actionable insights that could inspire similar strategies,

• Broad declines set a cautious tone as only a handful of single stocks avoided losses last week amid rising option volumes.
• Market breadth deteriorated sharply, marking the weakest showing of the past year and highlighting the pressure across Hong Kong equities.
• We highlight companies reporting next week in what shapes up as a busy week ahead with Baba and Meituan both reporting.

• As expected, Zhejiang Leapmotor Technologie (9863 HK) will replace ASM Pacific Technology (522 HK) in the Hang Seng TECH Index (HSTECH INDEX) at the December rebalance.
• Estimated one-way turnover is 4.7% and that results in a round-trip trade of HK$27.5bn (US$3.5bn). There is between 8.7-9.8 days of ADV to trade in the two stocks.
• Capping and float changes results in chunky flows to some other stocks and there could be big price moves over the next week.

• In this insight, we present the flows to buy and sell for each of the top 6 Hang Seng Index Family indices based on estimated tracking AUM.
• The indices: Hang Seng Index (HSI), HS Tech Index (HSTECH), HS China Enterprise Index (HSCEI), HS HK Biotech (HSHKBIO), HS Internet & Infotech (HSIII), and HS Healthcare Index (HSHCI).
• By Quiddity calculations based on the 21 November close, there is one-way flow across these six indices of HK$26.14bn (approximately), to trade on 5 December at the close.

• 3SBio plans to spin-off and list Mandi on Hong Kong Stock Exchange. The spin-off will allow Mandi to operate independently, with 3SBio ceasing to hold any interest in it post-listing. 
• Minoxidil is the main performance driver for Mandi. Our forecast is its revenue growth in 2025 would be 15%-20% YoY, with projected revenue range for 2025 of RMB1.538-1.604 billion.
• Considering Mandi ®’s market leadership position and a growth rate higher than the industry average, we estimate its forward P/S at 20-25x. Then, valuation range for Mandi is RMB31-40 billion.

• Given the size of Mandi – relative to 3SBio Inc (1530 HK) – higher market multiples for its in-specie spin-off may have a limited impact on the overall valuation.
• CATL (3750 HK)  raised around US$5.2bn in its H-share listing in May 2025. The last day for their lockup was the 19th November 2025.
• While Grindr (GRND US) Special Committee considers the MBO proposal, chairman James Lu has unusually opted to step down. And sell shares below the NBIO price. 

• Pharma-Play 3SBio Inc (1530 HK) has announced the spin-off and listing of 87.16%-held Mandi (MANDI HK)  on the HKEx. 
• 3SBio will distribute its stake in-specie. There will be a concurrent global offering, the details of which are still to be fleshed out. 
• Mandi (MANDI HK), a ” hair loss and weight management treatments” solutions provider, accounted for 17% of 3SBio’s revs in the 1H25, and 12.5% of profit.

• We initiate our coverage on Health and Happiness International Holding Limited (H&H)’s BTSDF 9.125% 24Jul2028.
• H&H has refinanced USD320m of 2026 notes with the new USD300m of 2028 notes at a 9.125% coupon. The new bonds help extend its debt maturity and lower financing cost.
• The bonds offer diversification and a chance to invest back in China after the fallout in the property sector. We assign an OVERWEIGHT recommendation.

• Simandou’s planned 120 Mt annual output could supply about 6% of global seaborne ore by 2030, pressuring Australia and Brazil and shifting premium-grade pricing.
• Despite Guinea’s push to diversify buyers, roughly three-quarters of Simandou’s ownership ties back to China, making most tonnage effectively committed to Chinese mills.
• Weak Chinese steel margins and a 12% YoY drop in October output limit near-term uptake, but long-term decarbonisation trends support stronger demand for high-grade feedstock.

• UST yields fell meaningfully yesterday, with the curve bull steepening as market expectations for Fed rate cuts climbed.
• This followed an uptick in the September unemployment rate, despite payrolls data coming in above estimates.
• The yield on the 2Y UST decreased 6 bps to 3.53%, while that on the 10Y UST declined 5 bps to 4.09%. 

• After seven months had elapsed since receiving a preliminary non-binding proposal, Smart Share Global (EM US) announced on the 1st August a firm Offer (an MBO) had been entered into.
• The Offeror consortium, led by Mars Guangyuan Cai, Chairman and CEO, is offering US$1.25/ADS, a 74.8% premium to last close; but ~20% below net cash + short-term investments.
• Hillhouse upped the ante with a US$1.77/ADS NBIO. The share price hasn’t closed below US$1.25/share since; but the reason may not just hinge on Hillhouse firming its Offer.

• Oriental Watch (398 HK) maintained its dividend yield of ~12% (annualized), declaring 20.8 HKD cents of dividend for H1FY26. Cash and Investments were ~ HKD1 billion (60% of market cap).
• The company highlighted that the environment is challenging, given trade wars and tempered HK/Chinese demand. On our conservative numbers, the stock trades at 8.6x FY26PE. 
• Oriental Watch (398 HK)  will maintain its high dividend payout ratio of ~100%. Over the past 8 years, the company paid dividends of 3.8 HKD/share (> the current share price).

• Context: Over the past few trading days, JD.com (9618 HK) multi-leg option strategies showcased a variety of approaches. Strategy highlights are provided.
• Highlights: Strategies tend to have a short-term horizon, with approximately 40% of all strategies employing weekly options. Bearish views dominate with almost 70% of strategies being put spreads.
• Why read: This Insight breaks down complex option strategies and sheds light on market sentiment and positioning. Detailed examples provide actionable insights that could inspire similar strategies,

• Sa Sa International Hldgs (178 HK)‘s 1H FY25/26 profit came in at the top-end of the guidance. Its 3Q sales growth has so far increased 11.3%, a further acceleration.
• Hong Kong and Macau should capture some of the diverted traffic as Sino-Japanese relations soured, while a weaker USD, as rates are cut, should make shopping cheaper.
• With its ROE reaching 10-13% in FY26-28F (the best ones since FY21), its 5-year-low P/B multiple makes the stock a bargain.

• Axbio, a China-based technology company, is looking to raise at least USD 100 million via a Hong Kong listing. CICC and SPDB are the joint sponsors.
• In our previous note, we look at the products and management team briefly. Although there are interesting takes from the prospectus, we are not convinced about its prospects.
• In this note, we took a further look and are of the view that the company is behind the curve of competition despite its incremental innovation in PCR-microarray.

• ZTO Express reported another set of weak results after the US close on November 19
• Although Q3 unit prices rose slightly, unit costs increased by much more, crushing margins
• On both sides of the price-volume tradeoff, ZTO continues to lose profitability | AVOID

• In today’s Morning Views publication we comment on developments of the following high yield issuers: Lenovo
• UST yields rose 2-3 bps across the curve yesterday, as the release of hawkish-leaning October Fed meeting minutes cast doubts over a rate cut in December.
• This was despite a solid auction of 20Y notes. Yields on USTs rose 2 bps each, to 3.59% for the 2Y and 4.14% for the 10Y. Equities halted a four-day slide, after Nvidia reported solid Q3/25-26 results and gave a strong revenue forecast. The S&P 500 and Nasdaq climbed 0.4% and 0.6% to 6,642 and 22,564, respectively.

• Key 3Q25 takeaways include: 1) trade-in scenarios remain a key driver of transaction volume growth, with building demand for RERE’s programs given rising prices for new devices, as well as the company’s focus on optimizing pricing, elevating user experiences, and stepped-up branding initiatives 2) in addition to the company’s door-to-door fulfillment capabilities, RERE’s growing network of AHS stores continues to drive enhanced accessibility and more favorable economics, with 1,000+ locations now offering multi-category recycling services and 3) a key priority for senior management remains building the AHS brand to raise customer awareness, enhance loyalty, and support engagement, with specific initiatives including partnering with consumer brands and deepening community relationships to position AHS as the leading recycling ecosystem.

• Genes Tech Group Holdings (8257 HK), a turnkey solutions provider, has announced a rare, arm’s-length Offer, by way of a Scheme. 
• The Offeror, privately-held Tinicum, is offering HK$0.245/share (not declared final), a 87% premium to last close, and a four-plus-year high.
• Irrevocables comprising 69.79% of the register are supportive. Super clean deal

• Equity placing strengthens Hongqiao’s balance sheet, cuts refinancing risk, and supports Yunnan’s low-carbon capacity migration.
• FY25–27 forecasts updated: modest EPS dilution offset by lower interest costs and improved cash generation.
• Valuation remains discounted vs global peers despite first-quartile costs, rising renewable mix, and improving aluminium market fundamentals.

• Revenue held up in 3Q25 as credit-driven services offset weakness in platform services, while regulatory and macro pressures continued to drive a strategic shift toward capital-heavy lending.
• Provisions surged due to regulatory-driven business mix changes rather than asset-quality deterioration, pushing cost of risk sharply higher and weighing on profitability.
• Despite lower FY25 guidance and reduced RoE, valuation remains attractive with meaningful upside supported by a higher target P/B and strong total return potential.

• Revenue growth accelerated for third quarter to 14% YoY in 3Q25.
• GMV of live streaming e-commerce grew by 18% YoY in 3Q25.
• The operating margin improved significantly by 4.7 ppt YoY in 3Q25.

• Dominant player in China’s children’s wear market through its highly successful ‘Balabala’ brand, which holds the leading market share.
• The children’s wear segment serves as the primary growth engine, consistently contributing a larger share of revenue and offsetting the slower growth in the more mature adult casual wear segment.
• Financial performance shows a recovery trajectory with revenue and net income growth in recent years, supported by improving margins and a strong dividend yield.

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• APAC Resources is a Hong Kong-listed investment holding company focused on natural resources, with a dual strategy of commodity trading and making strategic investments in mining and energy companies.
• The company exhibits strong top-line and bottom-line growth in the most recent two years, swinging from a significant loss to profitability. However, this performance is coupled with extremely volatile and recently negative operating cash flows, highlighting the cyclicality and risks inherent in its business model.
• Valuation appears attractive with a low price-to-book ratio and a high dividend yield, but this is counterbalanced by high uncertainty and a dependency on volatile global commodity markets, particularly those influenced by China’s demand.

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• CHJ’s business model integrates franchise stores and self-operated stores. Franchising as the main approach is beneficial for achieving rapid expansion, while self-operation as a supplement helps to enhance brand image.
• Due to increasing competition, future growth of CHJ may not be benefit from the high gold prices, but may be under pressure due to rising raw material costs/reduced customer demand.
• We think valuation of CHJ should be lower than Laopu, but could be higher than Zhou Liu Fu (6168 HK) due to CHJ’s higher performance growth in the short term.  

• Jiangsu Hengrui Pharmaceuticals (1276 HK), a China-based pharmaceutical company, raised around US$1.5bn in its H-share listing in May 2025. The lockup on its cornerstone will expire soon.
• JHP Has been ranked as one of the global Top 50 pharmaceutical companies by Pharm Exec for six consecutive years since 2019.
• In this note, we will talk about the lockup dynamics and possible placement.

• In today’s Morning Views publication we comment on developments of the following high yield issuers: Health and Happiness (H&H), West China Cement, China Hongqiao, Xiaomi Corp
• UST yields declined yesterday, led by the front end, following soft data from the ADP’s weekly employment gauge. The UST curve bull steepened, with the yields on the 2Y UST and 10Y UST decreasing 4 bps to 3.57% and 3 bps to 4.11%, respectively. Equities slumped on a sell-off in large tech stocks. The S&P 500 fell for a fourth straight day, dropping 0.8% to 6,617.
• Richmond Fed President Tom Barkin (who is a non-voting member this year) said that the labour market may be weaker than the data suggested, adding that he believes “inflation remains somewhat elevated but isn’t likely to increase much”.

• Genuine Biotech is looking to raise at least US$100 million via a Hong Kong listing. The sole sponsor is CICC.
• In our previous note, we briefly looked at the company’s fundamentals.
• In this note, we analyzed the latest changes in the company and the challenges faced by the company.

• The review period for the December rebalance of the CSI Overseas China Internet Index ended 31 October. The changes should be announced 28 November and implemented close on 12 December.
• There could be 6 inclusions for the KraneShares CSI China Internet ETF (KWEB US) in December with most inclusions being high probability.
• Impact on the inclusions varies between 1.3-5 days of ADV. There will be stocks with float increases and some capping changes.

• 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. 

• Xiaomi’s total revenue grew by 22% in 3Q25, which mainly came from the startup vehicle business.
• The company well controls the gross margin of the vehicle business.
• We believe XM has an upside of 60% for the yearend 2025.

• As Brian Freitas recently outlined, the Hang Seng Index (HSI INDEX) changes will be announced November 21st (this Friday) and take effect on December 6th.
• Brian predicted index additions and no deletions. As with all rebalances, inflows, outflows, and adjustments could trigger volatility. Our models, trained on decades of market data, help forecast these moves.
• Currently the HSI INDEX is in a mild WEEKLY correction, after a previous modest 2-week rally. We are still waiting for a meaningful correction, after the recent monster rally.

• In 3Q25, total revenue increased by 16% YoY with hotel booking up by 18% YoY and transportation commission up by 12% YoY.
• Overseas travel continued to recover and consumption shrink does not impact TCOM much.
• We believe the stock has an upside of 29% for the next twelve months.

• Revenue growth in Q3 (+15.5% Y/Y) held up reasonably well for Trip.com
• But core margins continue to deteriorate: Adjusted EBITDA margin down -120 bps Y/Y
• We still feel TCOM shares are pricey, and that earnings growth is unimpressive

• Alebund Pharmaceuticals, a China-based clinical-stage biotech company, is looking to raise at least USD 100 million via a Hong Kong listing. Jefferies, BoA, and HTSC are the joint sponsors.
• In our previous note, we looked at the company’s history and its core product, AP301, and AP306, and its management.
• In this note, we look at the core product AP301’s pivotal Phase 3 data for AP301 presented in ASN2025.

• Jiangsu Lopal Tech is undergoing a significant strategic pivot from its traditional automotive fine chemicals business to the high-growth, yet volatile, lithium iron phosphate (LFP) cathode materials market for electric vehicle (EV) batteries.
• This transition has fueled exceptional revenue growth but has also led to severe profitability challenges, with the company posting significant net losses and negative margins over the past two years, driven by raw material price volatility and intense competition.
• The company’s financial health is under pressure, evidenced by negative operating cash flow in recent periods and a net current liability position. Future success hinges on stabilizing LFP profitability, managing cash flow, and navigating the highly competitive dynamics of the EV supply chain.

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• Anjoy Foods Group (2648 HK)‘s rally since reporting 3Q25 results is prompted by solid revenue and margin recovery. Its HA discount has narrowed 6.1pp from IPO. 
• Sales model and geographical optimisation has driven business outlook. With projected EPS CAGR of 10.4%, it is now in line with the sector momentum.
• Its PEG of 1.4x is below peer’s average of 1.9x. With net cash equalling 15.1% of its share price, it can deliver a decent 5.4% FY26F dividend yield.

• International Entertainment is undergoing a high-stakes transformation, marked by explosive revenue growth driven by its Philippine hotel and gaming operations. However, this growth is coupled with severe and widening net losses and significant cash burn, raising concerns about its path to profitability.
• The company is making a significant capital investment to acquire and renovate a casino in Manila, transitioning from a hotel operator and equipment lessor to a fully integrated resort operator. This move hinges on the continued growth of the Philippine gaming market and the company’s ability to manage a large-scale development.
• Extreme financial distress, evidenced by collapsing margins, negative cash flows, and a history of profit warnings, presents a high-risk profile. The company’s future viability is dependent on a successful operational turnaround and its ability to generate profit from its rapidly growing revenue base.

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• China Hongqiao (1378 HK) is looking to raise US$1.2bn via a top-up placement at an indicative price of HK$29.2/share, a 9.6% discount from the last close.
• There will be limited passive buying from global index trackers at the time of settlement of the placement shares. However, there are a couple of potential index inclusions in December.
• Then there will be more passive buying from trackers of a global index, Hang Seng Index (HSI INDEX) and Hang Seng China Enterprises Index (HSCEI INDEX) next year.

• Post market close on Friday, Hang Seng Indexes will announce the changes for the Hang Seng Index (HSI INDEX) that will be implemented at the close on 5 December.
• We highlight 6 stocks that have a higher probability of being added to the index. With the index committee entitled to a lot of discretion, there will be differences.
• CATL (3750 HK) will have a 6-month trading history by implementation of the index changes and is a high probability inclusion to the index. But cornerstone lock-up ends tomorrow.

• Alibaba (9988 HK) / Alibaba (BABA US) will announce quarterly results on Tuesday, November 25, 8:30 p.m. HKT (7:30 a.m. U.S. Eastern Time)
• Options markets anticipate an above average move with a bearish bias in traders’ expectations. Implied volatility is expected to drop significantly after the event.
• Get ready for Alibaba‘s earnings announcement. Potential above-average volatility in Alibaba has the potential to impact the wider market and Chinese benchmark indices.

• China Hongqiao (1378 HK) is looking to raise around US$1.2bn from a primary placement.
• This represents 9.1 days of the stock’s three month ADV, and 2.9% of total shares outstanding.
• In this note, we will talk about the placement and run the deal through our ECM framework.

• Chuangxin Industries (CXI HK) is looking to raise up to US$700m in its upcoming Hong Kong IPO.
• It is focused on alumina refining and aluminum smelting within the upstream of the aluminum industry chain.
• In this note, we examine the IPO dynamics, and look at the firm’s valuation.

• On the 28th April 2025, PRC-incorporated property management play Jinke Smart Services (9666 HK) announced a possible unconditional MGO take-under at HK$6.67/share from a Boyu-backed Offeror.
• The Offeror (and Concert Parties), bought a 18.05% stake in Jinke at auction, lifting their stake >50% triggering the MGO. The Offeror’s intention was to maintain Jinke’s listing. 
• That’s now changed. The Offeror is now seeking Jinke’s delisting at HK$8.69/share; however, as Jinke is PRC incorporated, the privatisation conditions include a Scheme-like vote and a 90% tendering condition. 

• HK$100bn a day of gross SOUTHBOUND activity with US$600mm+ of net buying on average. Net flows continue to be impressive. SOEs/Energy/Financials dominate.
• Watch for news on the Dual Counter (RMB) Trading eligibility for SOUTHBOUND near-term. That could up the pace of things.
• The data tables below update on a daily basis in the Tools section of Smartkarma. The Southbound Flow Monitor and AH Pairs Monitor are both there – free – for all SK readers.

• CATL (3750 HK) raised around US$5.2bn in its H-share listing in May 2025. The lockup on its cornerstone investors is set to expire soon.
• CATL is the global leader in new energy vehicle battery solutions, in China and globally, as per SNE Research.
• In this note, we will talk about the lockup dynamics and possible placement.

• Bearish fundamental views are strengthening: Recent Smartkarma Insights argue BYD (1211 HK) is overvalued, with slowing sales growth and valuation multiples pointing to limited upside.
• Call overwriting offers efficient yield: Implied volatility in the mid-30s enables attractive income generation.
• Strike and expiry selection matter: Short-dated December options provide the best liquidity, while higher strikes balance premium income with room for near-term upside.

• Baidu, Inc. delivered a solid performance in the first quarter of 2025, with its Baidu Core division reporting a 7% year-over-year revenue increase, reaching RMB 25.5 billion.
• This growth was primarily driven by a substantial surge in its AI cloud business, which saw a 42% increase year-over-year, contributing significantly to Baidu Core’s overall revenue.
• A notable development within this business unit is the expansion of the AI cloud’s role in Baidu’s operations, now accounting for 26% of Baidu Core’s revenue, up from 20% in the previous year.