Category

Hong Kong

Brief Hong Kong: HK Connect Ideas: Nine Weeks of Inflows, Sino Biopharm, Yadea, Anta, Aoyuan (2019-07-12) and more

By | Daily Briefs, Hong Kong

In this briefing:

  1. HK Connect Ideas: Nine Weeks of Inflows, Sino Biopharm, Yadea, Anta, Aoyuan (2019-07-12)
  2. Are Risky Assets Overvalued?
  3. Trade War/Hong Kong/Shipbuilding/Rubbish
  4. Taking Off: Vietnamese Exports Are Rocking and Rolling
  5. Hong Kong Short Reporting – Insights from 5 July Data

1. HK Connect Ideas: Nine Weeks of Inflows, Sino Biopharm, Yadea, Anta, Aoyuan (2019-07-12)

China vanke co., ltd. %282202 hk%29 daily southbound inflow2019 07 15%2010 27 23

In our weekly HK Connect Snippet series, we aim to help our investors understand the flow of southbound trades via the Hong Kong Connect, as analyzed by our proprietary data engine, and highlight interesting observations. 

We split the stocks eligible for the Hong Kong Connect trade into three groups: HSCEI component stocks, stocks with a market capitalization between USD 1 billion and USD 5 billion, and stocks with a market capitalization between USD 500 million and USD 1 billion.

In this insight, we would like to highlight the nine consecutive weeks of inflows from mainland China to Hong Kong stocks. We highlight the inflows into China Vanke Co Ltd (H) (2202 HK), Tencent Holdings (700 HK)Sino Biopharmaceutical (1177 HK), and outflows from Future Land Development Holdings (1030 HK), Sunac China Holdings (1918 HK), and WH Group (288 HK). In addition, we would highlight the trading opportunities on Meituan Dianping (3690 HK) and Xiaomi Corp (1810 HK)‘s likely inclusion into Hong Kong Connect this month. In the mid cap space, we highlighted Kingdee International Software (268 HK), China Aoyuan Property (3883 HK), Yadea Group Holdings (1585 HK) and Anta Sports Products (2020 HK).

2. Are Risky Assets Overvalued?

Cape to long term average log cape to average chartbuilder 2

US stocks are significantly overvalued and we should expect lower than average returns going forward, unless there is going to be a substantial increase in earnings growth.

In the credit space, corporate bonds are expensive, and leveraged loans unattractive.

As risky assets become less attractive and expensive, that leaves investors mostly with Government Bonds.

3. Trade War/Hong Kong/Shipbuilding/Rubbish

China News That Matters

  • Trump complains about Chinese shopping
  • Hong Kong crisis – deal “dead”, but not withdrawn
  • When we could be diving for pearls
  • Where there’s muck, there’s brass

In my weekly digest China News That Matters, I will give you selected summaries, sourced from a variety of local Chinese-language and international news outlets, and highlight why I think the news is significant. These posts are meant to neither be bullish nor bearish, but help you separate the signal from the noise.

4. Taking Off: Vietnamese Exports Are Rocking and Rolling

Asia%20exports%201

Whisper it quietly but not all Asian exporters are struggling. In the first six months of 2019 the dollar value of exports from Korea dropped 8.5% YoY. Taiwanese exports were down 3.6% YoY . Meanwhile, Chinese exports, the country at the heart of the trade war, were down just 0.1% YoY.  

5. Hong Kong Short Reporting – Insights from 5 July Data

We analyse the latest SFC data released today on short position reporting in Hong Kong for the week ended 5 July.

Total short notional in Hong Kong increased from US$58.12bn to US$59.63bn over the week. This is an increase of 2.6% vs a 0.8% gain for the HSI.

The largest notional increase in short positions were Zhongsheng Group (881 HK), Tencent Holdings (700 HK), Geely Auto (175 HK),Ping An Insurance (H) (2318 HK) and Xiaomi Corp (1810 HK) while the largest decreases in short notional were Meituan Dianping (3690 HK), ICBC (H) (1398 HK) and Semiconductor Manufacturing (981 HK).

Short positions increased in Anta Sports Products (2020 HK) on the back of a short seller report and Future Land Development Holdings (1030 HK) on news of the Chairman’s arrest, while Kingsoft Corp (3888 HK) remained the most shorted stock as a percentage of market cap.

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Brief Hong Kong: Are Risky Assets Overvalued? and more

By | Daily Briefs, Hong Kong

In this briefing:

  1. Are Risky Assets Overvalued?
  2. Trade War/Hong Kong/Shipbuilding/Rubbish
  3. Taking Off: Vietnamese Exports Are Rocking and Rolling
  4. Hong Kong Short Reporting – Insights from 5 July Data
  5. The Legacy: The Electoral Fudge that Is Hong Kong

1. Are Risky Assets Overvalued?

Fredgraph

US stocks are significantly overvalued and we should expect lower than average returns going forward, unless there is going to be a substantial increase in earnings growth.

In the credit space, corporate bonds are expensive, and leveraged loans unattractive.

As risky assets become less attractive and expensive, that leaves investors mostly with Government Bonds.

2. Trade War/Hong Kong/Shipbuilding/Rubbish

China News That Matters

  • Trump complains about Chinese shopping
  • Hong Kong crisis – deal “dead”, but not withdrawn
  • When we could be diving for pearls
  • Where there’s muck, there’s brass

In my weekly digest China News That Matters, I will give you selected summaries, sourced from a variety of local Chinese-language and international news outlets, and highlight why I think the news is significant. These posts are meant to neither be bullish nor bearish, but help you separate the signal from the noise.

3. Taking Off: Vietnamese Exports Are Rocking and Rolling

Asia%20exports%201

Whisper it quietly but not all Asian exporters are struggling. In the first six months of 2019 the dollar value of exports from Korea dropped 8.5% YoY. Taiwanese exports were down 3.6% YoY . Meanwhile, Chinese exports, the country at the heart of the trade war, were down just 0.1% YoY.  

4. Hong Kong Short Reporting – Insights from 5 July Data

We analyse the latest SFC data released today on short position reporting in Hong Kong for the week ended 5 July.

Total short notional in Hong Kong increased from US$58.12bn to US$59.63bn over the week. This is an increase of 2.6% vs a 0.8% gain for the HSI.

The largest notional increase in short positions were Zhongsheng Group (881 HK), Tencent Holdings (700 HK), Geely Auto (175 HK),Ping An Insurance (H) (2318 HK) and Xiaomi Corp (1810 HK) while the largest decreases in short notional were Meituan Dianping (3690 HK), ICBC (H) (1398 HK) and Semiconductor Manufacturing (981 HK).

Short positions increased in Anta Sports Products (2020 HK) on the back of a short seller report and Future Land Development Holdings (1030 HK) on news of the Chairman’s arrest, while Kingsoft Corp (3888 HK) remained the most shorted stock as a percentage of market cap.

5. The Legacy: The Electoral Fudge that Is Hong Kong

Ftl%203

Hong Kong is headline news for all the wrong reasons these days. An out-of-touch, appointed government of civil servants (all of the business people approached to serve in high office after the last chief executive “election” refused positions) has been forced to withdraw a bill – the Extradition Law – that no-one in Hong Kong wanted and no-one in Beijing demanded. It is an utter mess but the inevitable consequence of having the head of government elected by 1200 appointees who have no interest in anything except ingratiating themselves with their masters in Beijing and whose choice of candidates is defined by pliability, not ability. 

Get Straight to the Source on Smartkarma

Smartkarma supports the world’s leading investors with high-quality, timely, and actionable Insights. Subscribe now for unlimited access, or request a demo below.



Brief Hong Kong: Trade War/Hong Kong/Shipbuilding/Rubbish and more

By | Daily Briefs, Hong Kong

In this briefing:

  1. Trade War/Hong Kong/Shipbuilding/Rubbish
  2. Taking Off: Vietnamese Exports Are Rocking and Rolling
  3. Hong Kong Short Reporting – Insights from 5 July Data
  4. The Legacy: The Electoral Fudge that Is Hong Kong
  5. TOT Biopharm (东曜药业) IPO: An Unimpressive Pipeline

1. Trade War/Hong Kong/Shipbuilding/Rubbish

China News That Matters

  • Trump complains about Chinese shopping
  • Hong Kong crisis – deal “dead”, but not withdrawn
  • When we could be diving for pearls
  • Where there’s muck, there’s brass

In my weekly digest China News That Matters, I will give you selected summaries, sourced from a variety of local Chinese-language and international news outlets, and highlight why I think the news is significant. These posts are meant to neither be bullish nor bearish, but help you separate the signal from the noise.

2. Taking Off: Vietnamese Exports Are Rocking and Rolling

Asia%20exports%201

Whisper it quietly but not all Asian exporters are struggling. In the first six months of 2019 the dollar value of exports from Korea dropped 8.5% YoY. Taiwanese exports were down 3.6% YoY . Meanwhile, Chinese exports, the country at the heart of the trade war, were down just 0.1% YoY.  

3. Hong Kong Short Reporting – Insights from 5 July Data

We analyse the latest SFC data released today on short position reporting in Hong Kong for the week ended 5 July.

Total short notional in Hong Kong increased from US$58.12bn to US$59.63bn over the week. This is an increase of 2.6% vs a 0.8% gain for the HSI.

The largest notional increase in short positions were Zhongsheng Group (881 HK), Tencent Holdings (700 HK), Geely Auto (175 HK),Ping An Insurance (H) (2318 HK) and Xiaomi Corp (1810 HK) while the largest decreases in short notional were Meituan Dianping (3690 HK), ICBC (H) (1398 HK) and Semiconductor Manufacturing (981 HK).

Short positions increased in Anta Sports Products (2020 HK) on the back of a short seller report and Future Land Development Holdings (1030 HK) on news of the Chairman’s arrest, while Kingsoft Corp (3888 HK) remained the most shorted stock as a percentage of market cap.

4. The Legacy: The Electoral Fudge that Is Hong Kong

Ftl%202

Hong Kong is headline news for all the wrong reasons these days. An out-of-touch, appointed government of civil servants (all of the business people approached to serve in high office after the last chief executive “election” refused positions) has been forced to withdraw a bill – the Extradition Law – that no-one in Hong Kong wanted and no-one in Beijing demanded. It is an utter mess but the inevitable consequence of having the head of government elected by 1200 appointees who have no interest in anything except ingratiating themselves with their masters in Beijing and whose choice of candidates is defined by pliability, not ability. 

5. TOT Biopharm (东曜药业) IPO: An Unimpressive Pipeline

Product%20pipeline2

TOT Biopharm, a China-based clinical-stage biopharmaceutical company, plans to raise at least USD 100 million from its listing on the Hong Kong Stock Exchange. In this insight, we will look at the company’s product pipeline, and the company’s shareholders and management team. 

With only one Avastin biosimilar in the near-commercial stage clinical trial, we think the company’s portfolio and the experience of the management team are not impressive. 

Get Straight to the Source on Smartkarma

Smartkarma supports the world’s leading investors with high-quality, timely, and actionable Insights. Subscribe now for unlimited access, or request a demo below.



Brief Hong Kong: Bank of China – An SOE Bank that Is Not Immune and more

By | Daily Briefs, Hong Kong

In this briefing:

  1. Bank of China – An SOE Bank that Is Not Immune
  2. Hong Kong /Trade War/Huawei/Stimulus/Stink Bugs
  3. Budweiser Brewing Company APAC IPO: A Solid PHIP Update
  4. ECM Weekly (15 Jun 2019) – Budweiser Brewing Co, Jinxin Fertility, Wanda Sports, Hansoh Pharma

1. Bank of China – An SOE Bank that Is Not Immune

1

Rural banks come to mind. Medium-sized banks as well. But it is not one of the large four SOE banks that we to feel will have some of the highest impairment cost growth. Yet, Bank Of China (601988 CH) ranks second of the largest 10 listed China banks for impairment cost growth in 1Q19 YoY at a staggering 76%. And this can continue through 2Q19 and through 2019. The reason is simple: BOC’s impairment costs remain far lower than large peer banks. With the profit warning from Bank Of East Asia (23 HK; BEA) due to worsening China credit metrics, worsening industrial output data (just out) and the full effects of US-China trade war yet to hit, BOC may have to play catch-up with peers. This is also apparent with its HK subsidiary, where credit costs are lower than most all peer banks at just 10bps of loans in 2018; BEA was 2.4x higher. See valuation, fundamental and momentum (VFM) research done by our Smartkarma colleague Paul Hollingworth on BOC and BEA in the past.

2. Hong Kong /Trade War/Huawei/Stimulus/Stink Bugs

China News That Matters

  • Do you hear the people sing?
  • The deadline is in my head
  • A wealth of data on people, governments and companies
  • So stimulating: Beijing pushes funding for big infrastructure
  • Stink Bug vs Armyworm, amid food inflation battle 

In my weekly digest China News That Matters, I will give you selected summaries, sourced from a variety of local Chinese-language and international news outlets, and highlight why I think the news is significant. These posts are meant to neither be bullish nor bearish, but help you separate the signal from the noise.

3. Budweiser Brewing Company APAC IPO: A Solid PHIP Update

Volume

Budweiser Hong Kong Holding (0338867D HK)/Budweiser APAC is Anheuser Busch Inbev Sa/Nv (ABI BB)’s Asian business and is the largest beer company by retail sales value based in the Asia Pacific, according to GlobalData. On Thursday, Budweiser APAC received HKEX approval for a Hong Kong IPO to raise $5-10 billion, according to press reports.

In our IPO initiation note, we concluded that Budweiser APAC fundamentals are strong. The PHIP update which outlines 1Q19 financials reinforces our view).

4. ECM Weekly (15 Jun 2019) – Budweiser Brewing Co, Jinxin Fertility, Wanda Sports, Hansoh Pharma

Upcoming

Aequitas Research puts out a weekly update on the deals that have been covered by Smartkarma Insight Providers recently, along with updates for upcoming IPOs.

This week’s Hong Kong IPO listings breathed life into the exchange as China Tobacco International (HK) (6055 HK) and Hansoh Pharmaceutical (3692 HK)‘s performed exceptionally well on debut, closing 40% and 36% above their respective IPO price for the week.

That said, not all IPOs had a good debut. China East Education (667 HK)‘s IPO flopped despite being the biggest education IPO in Hong Kong this year and was reported earlier that its books were covered on the second day of bookbuild.

Tai Hing (6811 HK)‘s IPO also took a hit, opening 17% below its IPO price. As per our valuation note, we thought that the IPO would only have been attractive from a valuation perspective at the bottom end of its IPO price range, hence, Wednesday’s low debut price presented a good opportunity to accumulate a position for near-term recovery.

Jinxin Fertility Co Ltd (1951 HK) is looking to close its books early. The IPO boasts Orbimed, Hillhouse, and Ally Bridge among its cornerstone investors. The three investors had also participated in Hansoh Pharma’s IPO which performed exceptionally well. Another potential IPO that is moving fast is Alibaba Group Holding (BABA US) which is said to have filed for Hong Kong listing which could raise up to US$20bn. 

On the other hand, ESR Cayman (ESR HK) pulled its Hong Kong IPO citing market condition as the reason. This was not totally unexpected as Sumeet Singh pointed out in his valuation note, ESR Cayman IPO – Richly Valued, that while it is a good company, implied valuation looks a tad too expensive and deal dynamics did not inspire confidence. Hopefully, the IPO will relaunch at a more sensible valuation.

In other countries, Thailand seems to be the most active of all. Asset World Corporation, owned by Charoen Sirivadhanabhakdi, will be looking to IPO in the second half of the year while Index Living Mall, a furniture and home-decoration retailer, is looking to list in the third quarter of 2019.

Accuracy Rate:

Our overall accuracy rate is 72.3% for IPOs and 63.8% for Placements 

(Performance measurement criteria is explained at the end of the note)

New IPO filings this week

  • Shenzhen Leoking (Hong Kong, US$100m)

Below is a snippet of our IPO tool showing upcoming events for the next week. The IPO tool is designed to provide readers with timely information on all IPO related events (Book open/closing, listing, initiation, lock-up expiry, etc) for all the deals that we have worked on. You can access the tool here or through the tools menu.

Source: Aequitas Research, Smartkarma

News on Upcoming IPOs

Analysis on Upcoming IPOs

NameInsight
Hong Kong
AB InbevAb InBev Asia Pre-IPO – A Brief History of the Asia Pacific Operations – Eeking Out Growth in China
AB InbevAb InBev Asia Pre-IPO – Quick Note – More like CR Beer Rather than Tsingtao
AB InbevAb InBev Asia Pre-IPO – On Its Way to Potentially Being the Biggest HK IPO This Year
AB Inbev

Budweiser Brewing APAC Pre-IPO – It Will Be a US$5bn+ Raise Owing to Its Clean Balance Sheet

AB Inbev

Budweiser Brewing Company APAC Pre-IPO – Country Performance and Updated Peer Comparison

AB Inbev

Budweiser Brewing Company APAC Pre-IPO – Refining Valuation for the Diverging Growth Prospects

AscentageAscentage Pharma (亚盛医药) IPO: Too Early for an IPO
Ant FinancialAnt Financial IPO Early Thought: Understand Fintech Empire, Growth & Risk Factors
CIMC VehCIMC Vehicle (中集车辆): Market Leader of Semi-Trailers but Little Growth Ahead
ClarityClarity Medical (清晰医疗) IPO: Proxy to HK SMILE Surgery Demand
ByteDance

ByteDance (字节跳动) IPO: How Jinri Toutiao Paves The Way for a Bigger Empire (Part 1)

ByteDance

ByteDance (字节跳动) IPO: Tiktok the No.1 Short Video App for a Good Reason (Part 2)

Helenbergh

Helenbergh (海伦堡) Early Thoughts – The Usual Red Flag – Related Party Transactions

Hut Chi-Med

Hutchison-China Med (和黄医药) H-Share Listing: MNC Partnerships Endorsed Its R&D Capabilities

Jinxin

Jinxin Fertility (锦欣生殖) Pre-IPO: Strong Foothold in Sichuan but Weak Sentiment for Sector

MicuRxMicuRx Pharma (盟科医药) IPO: Betting on Single Drug in the Not so Attractive Antibiotic Segment
SH Henlius

Shanghai Henlius (复宏汉霖) IPO: Not an Impressive Biosimilar Portfolio 

SH Henlius

Shanghai Henlius (复宏汉霖) IPO: Valuation of Four Biosimilars

TubatuTubatu Group Pre-IPO – Performing Better than Qeeka but Growing Much Slower, US$1bn a Stretch
TubatuTubatu Group Pre-IPO – Online -> Online + Offline -> Online -> ?
South Korea
KMH ShillaKMH Shilla Leisure IPO Preview (Part 1) – Highly Profitable Operator of Public Golf Courses in Korea
KMH ShillaKMH Shilla Leisure IPO Preview (Part 2) – Valuation Analysis
Plakor

Plakor IPO Preview (Part 1)

ZinusZinus IPO Preview (Part 1) – An Amazing Comeback Story (#1 Mattress Brand on Amazon)
India
Aakash EduAakash Education Pre-IPO – Fast Growth in an Attractive Sector
Anmol IndAnmol Industries Pre-IPO Quick Take – No Growth, Generous Payments to Founders
Bharat Hotels

Bharat Hotels Pre-IPO – Catching up with Peers 

CMS InfoCMS Info Systems Pre-IPO – When a PE Sells to Another PE… Only One Gets the Timing Right
Crystal CropCrystal Crop Protection Pre-IPO – DRHP Raises More Questions than in Answers
Flemingo Flemingo Travel Retail Pre-IPO – Its a Different Business in Every Country
NSENSE IPO Preview- Not Only Fast..its Risky and Expensive
NSENational Stock Exchange Pre-IPO Review – Bigger, Better, Stronger but a Little Too Fast for Some
MazagonMazagon Dock IPO Preview: A Monopoly Submarine Yard in India with Captive Navy Spending
Mrs. BectorMrs. Bectors Food Specialities Pre-IPO Quick Take – Sales for Its Main Segment Have Been Sta

Lodha

Lodha Developers Pre-IPO – Second Time Lucky but Not Really that Much Affordable
LodhaLodha Developers IPO: Presence in Affordable Segment Saves Lodha the Blushes in a Sluggish Mkt
IndiaMartIndiaMART Pre-IPO – Getting and Retaining Subscribers Seems to Be Difficult
PNB MetPNB Metlife Pre-IPO Quick Take – Doesn’t Stack up Well Versus Its Larger Peers
Malaysia
QSRQSR Brands Pre-IPO – As Healthy as Fast Food
The U.S
DouyuDouyu (斗鱼直播) IPO: Leader At a Cost
DouyuDouyu (斗鱼直播) IPO: Comparison with Huya (Part 2)
MetenMeten International Edu (美联国际教育) Early Thoughts – Unclear Strategies
Wanda SportsWanda Sports (万达体育) Early Thoughts – Convoluted by Contracts and Cyclicality

Get Straight to the Source on Smartkarma

Smartkarma supports the world’s leading investors with high-quality, timely, and actionable Insights. Subscribe now for unlimited access, or request a demo below.



Brief Hong Kong: Taking Off: Vietnamese Exports Are Rocking and Rolling and more

By | Daily Briefs, Hong Kong

In this briefing:

  1. Taking Off: Vietnamese Exports Are Rocking and Rolling
  2. Hong Kong Short Reporting – Insights from 5 July Data
  3. The Legacy: The Electoral Fudge that Is Hong Kong
  4. TOT Biopharm (东曜药业) IPO: An Unimpressive Pipeline
  5. Dalian Port – Rearranging The Deck Chairs

1. Taking Off: Vietnamese Exports Are Rocking and Rolling

Asia%20exports%201

Whisper it quietly but not all Asian exporters are struggling. In the first six months of 2019 the dollar value of exports from Korea dropped 8.5% YoY. Taiwanese exports were down 3.6% YoY . Meanwhile, Chinese exports, the country at the heart of the trade war, were down just 0.1% YoY.  

2. Hong Kong Short Reporting – Insights from 5 July Data

We analyse the latest SFC data released today on short position reporting in Hong Kong for the week ended 5 July.

Total short notional in Hong Kong increased from US$58.12bn to US$59.63bn over the week. This is an increase of 2.6% vs a 0.8% gain for the HSI.

The largest notional increase in short positions were Zhongsheng Group (881 HK), Tencent Holdings (700 HK), Geely Auto (175 HK),Ping An Insurance (H) (2318 HK) and Xiaomi Corp (1810 HK) while the largest decreases in short notional were Meituan Dianping (3690 HK), ICBC (H) (1398 HK) and Semiconductor Manufacturing (981 HK).

Short positions increased in Anta Sports Products (2020 HK) on the back of a short seller report and Future Land Development Holdings (1030 HK) on news of the Chairman’s arrest, while Kingsoft Corp (3888 HK) remained the most shorted stock as a percentage of market cap.

3. The Legacy: The Electoral Fudge that Is Hong Kong

Ftl%202

Hong Kong is headline news for all the wrong reasons these days. An out-of-touch, appointed government of civil servants (all of the business people approached to serve in high office after the last chief executive “election” refused positions) has been forced to withdraw a bill – the Extradition Law – that no-one in Hong Kong wanted and no-one in Beijing demanded. It is an utter mess but the inevitable consequence of having the head of government elected by 1200 appointees who have no interest in anything except ingratiating themselves with their masters in Beijing and whose choice of candidates is defined by pliability, not ability. 

4. TOT Biopharm (东曜药业) IPO: An Unimpressive Pipeline

Product%20pipeline

TOT Biopharm, a China-based clinical-stage biopharmaceutical company, plans to raise at least USD 100 million from its listing on the Hong Kong Stock Exchange. In this insight, we will look at the company’s product pipeline, and the company’s shareholders and management team. 

With only one Avastin biosimilar in the near-commercial stage clinical trial, we think the company’s portfolio and the experience of the management team are not impressive. 

5. Dalian Port – Rearranging The Deck Chairs

Final

Back on the 4 June, Dalian Port (Pda) Co Ltd H (2880 HK) announced a possible Mandatory General Offer (MGO) at $1.0127/share, a 0.27% premium to last close. 

The MGO would be triggered following the rearrangement of various companies under the PRC government, collectively holding 68.37% into Dalian Port (Pda), with the long-term objective of merging the ports in Liaoning province under a single platform.

Dalian Port Corporation (PDA) currently holds 46.8% – via A and H shares – into Dalian Port (Pda). PDA, in turn, is a 100%-held subsidiary of Liaoning Port Group, which in turn is held as to 50.1% by the Liaoning Provincial Government (LPG) (through Liaoning SASAC) and 49.9% by China Merchants Liaoning (CML). 

This % holding into Liaoning Port Group was formulated in a restructuring last November.

LPG intends transferring (deemed the Equity Transfer, or ETA) 1.1% of its stake to CML, giving CML 51% (& effective control) of Liaoning Port Group. 

LPG will then transfer 36.34% and 2.66% of its equity interest in Liaoning Port Group to Dalian SASAC and Yingkou SASAC respectively for nil consideration. Perusing the shareholder charts helps crystalize the process.

The transfer is subject to a number of conditions, but presumably will be rubber-stamped. The long stop date for the conditions is 30 September. 

The new news is that the transfer agreement in respect of the Dalian SASAC equity transfer was executed on 17 June 2019  – it is not clear why Dalian Port (Pda) chose to make this announcement over three weeks after it was completed.

The ETA remains subject to a number of outstanding conditions.

From an arb perspective, there isn’t much skin in the game, but that is deliberate. The intention is to maintain Dalian Port (Pda)’s listing and therefore the low-ball Offer premium. But the development of this integrated port platform is interesting.

Get Straight to the Source on Smartkarma

Smartkarma supports the world’s leading investors with high-quality, timely, and actionable Insights. Subscribe now for unlimited access, or request a demo below.



Brief Hong Kong: Hong Kong /Trade War/Huawei/Stimulus/Stink Bugs and more

By | Daily Briefs, Hong Kong

In this briefing:

  1. Hong Kong /Trade War/Huawei/Stimulus/Stink Bugs
  2. Budweiser Brewing Company APAC IPO: A Solid PHIP Update
  3. ECM Weekly (15 Jun 2019) – Budweiser Brewing Co, Jinxin Fertility, Wanda Sports, Hansoh Pharma

1. Hong Kong /Trade War/Huawei/Stimulus/Stink Bugs

China News That Matters

  • Do you hear the people sing?
  • The deadline is in my head
  • A wealth of data on people, governments and companies
  • So stimulating: Beijing pushes funding for big infrastructure
  • Stink Bug vs Armyworm, amid food inflation battle 

In my weekly digest China News That Matters, I will give you selected summaries, sourced from a variety of local Chinese-language and international news outlets, and highlight why I think the news is significant. These posts are meant to neither be bullish nor bearish, but help you separate the signal from the noise.

2. Budweiser Brewing Company APAC IPO: A Solid PHIP Update

Volume

Budweiser Hong Kong Holding (0338867D HK)/Budweiser APAC is Anheuser Busch Inbev Sa/Nv (ABI BB)’s Asian business and is the largest beer company by retail sales value based in the Asia Pacific, according to GlobalData. On Thursday, Budweiser APAC received HKEX approval for a Hong Kong IPO to raise $5-10 billion, according to press reports.

In our IPO initiation note, we concluded that Budweiser APAC fundamentals are strong. The PHIP update which outlines 1Q19 financials reinforces our view).

3. ECM Weekly (15 Jun 2019) – Budweiser Brewing Co, Jinxin Fertility, Wanda Sports, Hansoh Pharma

Upcoming

Aequitas Research puts out a weekly update on the deals that have been covered by Smartkarma Insight Providers recently, along with updates for upcoming IPOs.

This week’s Hong Kong IPO listings breathed life into the exchange as China Tobacco International (HK) (6055 HK) and Hansoh Pharmaceutical (3692 HK)‘s performed exceptionally well on debut, closing 40% and 36% above their respective IPO price for the week.

That said, not all IPOs had a good debut. China East Education (667 HK)‘s IPO flopped despite being the biggest education IPO in Hong Kong this year and was reported earlier that its books were covered on the second day of bookbuild.

Tai Hing (6811 HK)‘s IPO also took a hit, opening 17% below its IPO price. As per our valuation note, we thought that the IPO would only have been attractive from a valuation perspective at the bottom end of its IPO price range, hence, Wednesday’s low debut price presented a good opportunity to accumulate a position for near-term recovery.

Jinxin Fertility Co Ltd (1951 HK) is looking to close its books early. The IPO boasts Orbimed, Hillhouse, and Ally Bridge among its cornerstone investors. The three investors had also participated in Hansoh Pharma’s IPO which performed exceptionally well. Another potential IPO that is moving fast is Alibaba Group Holding (BABA US) which is said to have filed for Hong Kong listing which could raise up to US$20bn. 

On the other hand, ESR Cayman (ESR HK) pulled its Hong Kong IPO citing market condition as the reason. This was not totally unexpected as Sumeet Singh pointed out in his valuation note, ESR Cayman IPO – Richly Valued, that while it is a good company, implied valuation looks a tad too expensive and deal dynamics did not inspire confidence. Hopefully, the IPO will relaunch at a more sensible valuation.

In other countries, Thailand seems to be the most active of all. Asset World Corporation, owned by Charoen Sirivadhanabhakdi, will be looking to IPO in the second half of the year while Index Living Mall, a furniture and home-decoration retailer, is looking to list in the third quarter of 2019.

Accuracy Rate:

Our overall accuracy rate is 72.3% for IPOs and 63.8% for Placements 

(Performance measurement criteria is explained at the end of the note)

New IPO filings this week

  • Shenzhen Leoking (Hong Kong, US$100m)

Below is a snippet of our IPO tool showing upcoming events for the next week. The IPO tool is designed to provide readers with timely information on all IPO related events (Book open/closing, listing, initiation, lock-up expiry, etc) for all the deals that we have worked on. You can access the tool here or through the tools menu.

Source: Aequitas Research, Smartkarma

News on Upcoming IPOs

Analysis on Upcoming IPOs

NameInsight
Hong Kong
AB InbevAb InBev Asia Pre-IPO – A Brief History of the Asia Pacific Operations – Eeking Out Growth in China
AB InbevAb InBev Asia Pre-IPO – Quick Note – More like CR Beer Rather than Tsingtao
AB InbevAb InBev Asia Pre-IPO – On Its Way to Potentially Being the Biggest HK IPO This Year
AB Inbev

Budweiser Brewing APAC Pre-IPO – It Will Be a US$5bn+ Raise Owing to Its Clean Balance Sheet

AB Inbev

Budweiser Brewing Company APAC Pre-IPO – Country Performance and Updated Peer Comparison

AB Inbev

Budweiser Brewing Company APAC Pre-IPO – Refining Valuation for the Diverging Growth Prospects

AscentageAscentage Pharma (亚盛医药) IPO: Too Early for an IPO
Ant FinancialAnt Financial IPO Early Thought: Understand Fintech Empire, Growth & Risk Factors
CIMC VehCIMC Vehicle (中集车辆): Market Leader of Semi-Trailers but Little Growth Ahead
ClarityClarity Medical (清晰医疗) IPO: Proxy to HK SMILE Surgery Demand
ByteDance

ByteDance (字节跳动) IPO: How Jinri Toutiao Paves The Way for a Bigger Empire (Part 1)

ByteDance

ByteDance (字节跳动) IPO: Tiktok the No.1 Short Video App for a Good Reason (Part 2)

Helenbergh

Helenbergh (海伦堡) Early Thoughts – The Usual Red Flag – Related Party Transactions

Hut Chi-Med

Hutchison-China Med (和黄医药) H-Share Listing: MNC Partnerships Endorsed Its R&D Capabilities

Jinxin

Jinxin Fertility (锦欣生殖) Pre-IPO: Strong Foothold in Sichuan but Weak Sentiment for Sector

MicuRxMicuRx Pharma (盟科医药) IPO: Betting on Single Drug in the Not so Attractive Antibiotic Segment
SH Henlius

Shanghai Henlius (复宏汉霖) IPO: Not an Impressive Biosimilar Portfolio 

SH Henlius

Shanghai Henlius (复宏汉霖) IPO: Valuation of Four Biosimilars

TubatuTubatu Group Pre-IPO – Performing Better than Qeeka but Growing Much Slower, US$1bn a Stretch
TubatuTubatu Group Pre-IPO – Online -> Online + Offline -> Online -> ?
South Korea
KMH ShillaKMH Shilla Leisure IPO Preview (Part 1) – Highly Profitable Operator of Public Golf Courses in Korea
KMH ShillaKMH Shilla Leisure IPO Preview (Part 2) – Valuation Analysis
Plakor

Plakor IPO Preview (Part 1)

ZinusZinus IPO Preview (Part 1) – An Amazing Comeback Story (#1 Mattress Brand on Amazon)
India
Aakash EduAakash Education Pre-IPO – Fast Growth in an Attractive Sector
Anmol IndAnmol Industries Pre-IPO Quick Take – No Growth, Generous Payments to Founders
Bharat Hotels

Bharat Hotels Pre-IPO – Catching up with Peers 

CMS InfoCMS Info Systems Pre-IPO – When a PE Sells to Another PE… Only One Gets the Timing Right
Crystal CropCrystal Crop Protection Pre-IPO – DRHP Raises More Questions than in Answers
Flemingo Flemingo Travel Retail Pre-IPO – Its a Different Business in Every Country
NSENSE IPO Preview- Not Only Fast..its Risky and Expensive
NSENational Stock Exchange Pre-IPO Review – Bigger, Better, Stronger but a Little Too Fast for Some
MazagonMazagon Dock IPO Preview: A Monopoly Submarine Yard in India with Captive Navy Spending
Mrs. BectorMrs. Bectors Food Specialities Pre-IPO Quick Take – Sales for Its Main Segment Have Been Sta

Lodha

Lodha Developers Pre-IPO – Second Time Lucky but Not Really that Much Affordable
LodhaLodha Developers IPO: Presence in Affordable Segment Saves Lodha the Blushes in a Sluggish Mkt
IndiaMartIndiaMART Pre-IPO – Getting and Retaining Subscribers Seems to Be Difficult
PNB MetPNB Metlife Pre-IPO Quick Take – Doesn’t Stack up Well Versus Its Larger Peers
Malaysia
QSRQSR Brands Pre-IPO – As Healthy as Fast Food
The U.S
DouyuDouyu (斗鱼直播) IPO: Leader At a Cost
DouyuDouyu (斗鱼直播) IPO: Comparison with Huya (Part 2)
MetenMeten International Edu (美联国际教育) Early Thoughts – Unclear Strategies
Wanda SportsWanda Sports (万达体育) Early Thoughts – Convoluted by Contracts and Cyclicality

Get Straight to the Source on Smartkarma

Smartkarma supports the world’s leading investors with high-quality, timely, and actionable Insights. Subscribe now for unlimited access, or request a demo below.



Brief Hong Kong: Budweiser Brewing Company APAC IPO: A Solid PHIP Update and more

By | Daily Briefs, Hong Kong

In this briefing:

  1. Budweiser Brewing Company APAC IPO: A Solid PHIP Update
  2. ECM Weekly (15 Jun 2019) – Budweiser Brewing Co, Jinxin Fertility, Wanda Sports, Hansoh Pharma

1. Budweiser Brewing Company APAC IPO: A Solid PHIP Update

Volume

Budweiser Hong Kong Holding (0338867D HK)/Budweiser APAC is Anheuser Busch Inbev Sa/Nv (ABI BB)’s Asian business and is the largest beer company by retail sales value based in the Asia Pacific, according to GlobalData. On Thursday, Budweiser APAC received HKEX approval for a Hong Kong IPO to raise $5-10 billion, according to press reports.

In our IPO initiation note, we concluded that Budweiser APAC fundamentals are strong. The PHIP update which outlines 1Q19 financials reinforces our view).

2. ECM Weekly (15 Jun 2019) – Budweiser Brewing Co, Jinxin Fertility, Wanda Sports, Hansoh Pharma

Upcoming

Aequitas Research puts out a weekly update on the deals that have been covered by Smartkarma Insight Providers recently, along with updates for upcoming IPOs.

This week’s Hong Kong IPO listings breathed life into the exchange as China Tobacco International (HK) (6055 HK) and Hansoh Pharmaceutical (3692 HK)‘s performed exceptionally well on debut, closing 40% and 36% above their respective IPO price for the week.

That said, not all IPOs had a good debut. China East Education (667 HK)‘s IPO flopped despite being the biggest education IPO in Hong Kong this year and was reported earlier that its books were covered on the second day of bookbuild.

Tai Hing (6811 HK)‘s IPO also took a hit, opening 17% below its IPO price. As per our valuation note, we thought that the IPO would only have been attractive from a valuation perspective at the bottom end of its IPO price range, hence, Wednesday’s low debut price presented a good opportunity to accumulate a position for near-term recovery.

Jinxin Fertility Co Ltd (1951 HK) is looking to close its books early. The IPO boasts Orbimed, Hillhouse, and Ally Bridge among its cornerstone investors. The three investors had also participated in Hansoh Pharma’s IPO which performed exceptionally well. Another potential IPO that is moving fast is Alibaba Group Holding (BABA US) which is said to have filed for Hong Kong listing which could raise up to US$20bn. 

On the other hand, ESR Cayman (ESR HK) pulled its Hong Kong IPO citing market condition as the reason. This was not totally unexpected as Sumeet Singh pointed out in his valuation note, ESR Cayman IPO – Richly Valued, that while it is a good company, implied valuation looks a tad too expensive and deal dynamics did not inspire confidence. Hopefully, the IPO will relaunch at a more sensible valuation.

In other countries, Thailand seems to be the most active of all. Asset World Corporation, owned by Charoen Sirivadhanabhakdi, will be looking to IPO in the second half of the year while Index Living Mall, a furniture and home-decoration retailer, is looking to list in the third quarter of 2019.

Accuracy Rate:

Our overall accuracy rate is 72.3% for IPOs and 63.8% for Placements 

(Performance measurement criteria is explained at the end of the note)

New IPO filings this week

  • Shenzhen Leoking (Hong Kong, US$100m)

Below is a snippet of our IPO tool showing upcoming events for the next week. The IPO tool is designed to provide readers with timely information on all IPO related events (Book open/closing, listing, initiation, lock-up expiry, etc) for all the deals that we have worked on. You can access the tool here or through the tools menu.

Source: Aequitas Research, Smartkarma

News on Upcoming IPOs

Analysis on Upcoming IPOs

NameInsight
Hong Kong
AB InbevAb InBev Asia Pre-IPO – A Brief History of the Asia Pacific Operations – Eeking Out Growth in China
AB InbevAb InBev Asia Pre-IPO – Quick Note – More like CR Beer Rather than Tsingtao
AB InbevAb InBev Asia Pre-IPO – On Its Way to Potentially Being the Biggest HK IPO This Year
AB Inbev

Budweiser Brewing APAC Pre-IPO – It Will Be a US$5bn+ Raise Owing to Its Clean Balance Sheet

AB Inbev

Budweiser Brewing Company APAC Pre-IPO – Country Performance and Updated Peer Comparison

AB Inbev

Budweiser Brewing Company APAC Pre-IPO – Refining Valuation for the Diverging Growth Prospects

AscentageAscentage Pharma (亚盛医药) IPO: Too Early for an IPO
Ant FinancialAnt Financial IPO Early Thought: Understand Fintech Empire, Growth & Risk Factors
CIMC VehCIMC Vehicle (中集车辆): Market Leader of Semi-Trailers but Little Growth Ahead
ClarityClarity Medical (清晰医疗) IPO: Proxy to HK SMILE Surgery Demand
ByteDance

ByteDance (字节跳动) IPO: How Jinri Toutiao Paves The Way for a Bigger Empire (Part 1)

ByteDance

ByteDance (字节跳动) IPO: Tiktok the No.1 Short Video App for a Good Reason (Part 2)

Helenbergh

Helenbergh (海伦堡) Early Thoughts – The Usual Red Flag – Related Party Transactions

Hut Chi-Med

Hutchison-China Med (和黄医药) H-Share Listing: MNC Partnerships Endorsed Its R&D Capabilities

Jinxin

Jinxin Fertility (锦欣生殖) Pre-IPO: Strong Foothold in Sichuan but Weak Sentiment for Sector

MicuRxMicuRx Pharma (盟科医药) IPO: Betting on Single Drug in the Not so Attractive Antibiotic Segment
SH Henlius

Shanghai Henlius (复宏汉霖) IPO: Not an Impressive Biosimilar Portfolio 

SH Henlius

Shanghai Henlius (复宏汉霖) IPO: Valuation of Four Biosimilars

TubatuTubatu Group Pre-IPO – Performing Better than Qeeka but Growing Much Slower, US$1bn a Stretch
TubatuTubatu Group Pre-IPO – Online -> Online + Offline -> Online -> ?
South Korea
KMH ShillaKMH Shilla Leisure IPO Preview (Part 1) – Highly Profitable Operator of Public Golf Courses in Korea
KMH ShillaKMH Shilla Leisure IPO Preview (Part 2) – Valuation Analysis
Plakor

Plakor IPO Preview (Part 1)

ZinusZinus IPO Preview (Part 1) – An Amazing Comeback Story (#1 Mattress Brand on Amazon)
India
Aakash EduAakash Education Pre-IPO – Fast Growth in an Attractive Sector
Anmol IndAnmol Industries Pre-IPO Quick Take – No Growth, Generous Payments to Founders
Bharat Hotels

Bharat Hotels Pre-IPO – Catching up with Peers 

CMS InfoCMS Info Systems Pre-IPO – When a PE Sells to Another PE… Only One Gets the Timing Right
Crystal CropCrystal Crop Protection Pre-IPO – DRHP Raises More Questions than in Answers
Flemingo Flemingo Travel Retail Pre-IPO – Its a Different Business in Every Country
NSENSE IPO Preview- Not Only Fast..its Risky and Expensive
NSENational Stock Exchange Pre-IPO Review – Bigger, Better, Stronger but a Little Too Fast for Some
MazagonMazagon Dock IPO Preview: A Monopoly Submarine Yard in India with Captive Navy Spending
Mrs. BectorMrs. Bectors Food Specialities Pre-IPO Quick Take – Sales for Its Main Segment Have Been Sta

Lodha

Lodha Developers Pre-IPO – Second Time Lucky but Not Really that Much Affordable
LodhaLodha Developers IPO: Presence in Affordable Segment Saves Lodha the Blushes in a Sluggish Mkt
IndiaMartIndiaMART Pre-IPO – Getting and Retaining Subscribers Seems to Be Difficult
PNB MetPNB Metlife Pre-IPO Quick Take – Doesn’t Stack up Well Versus Its Larger Peers
Malaysia
QSRQSR Brands Pre-IPO – As Healthy as Fast Food
The U.S
DouyuDouyu (斗鱼直播) IPO: Leader At a Cost
DouyuDouyu (斗鱼直播) IPO: Comparison with Huya (Part 2)
MetenMeten International Edu (美联国际教育) Early Thoughts – Unclear Strategies
Wanda SportsWanda Sports (万达体育) Early Thoughts – Convoluted by Contracts and Cyclicality

Get Straight to the Source on Smartkarma

Smartkarma supports the world’s leading investors with high-quality, timely, and actionable Insights. Subscribe now for unlimited access, or request a demo below.



Brief Hong Kong: Budweiser Brewing Company APAC IPO: A Solid PHIP Update and more

By | Daily Briefs, Hong Kong

In this briefing:

  1. Budweiser Brewing Company APAC IPO: A Solid PHIP Update
  2. ECM Weekly (15 Jun 2019) – Budweiser Brewing Co, Jinxin Fertility, Wanda Sports, Hansoh Pharma
  3. Jinxin Fertility Group IPO: Valuation Reasonable for the Trade-Offs

1. Budweiser Brewing Company APAC IPO: A Solid PHIP Update

Volume

Budweiser Hong Kong Holding (0338867D HK)/Budweiser APAC is Anheuser Busch Inbev Sa/Nv (ABI BB)’s Asian business and is the largest beer company by retail sales value based in the Asia Pacific, according to GlobalData. On Thursday, Budweiser APAC received HKEX approval for a Hong Kong IPO to raise $5-10 billion, according to press reports.

In our IPO initiation note, we concluded that Budweiser APAC fundamentals are strong. The PHIP update which outlines 1Q19 financials reinforces our view).

2. ECM Weekly (15 Jun 2019) – Budweiser Brewing Co, Jinxin Fertility, Wanda Sports, Hansoh Pharma

Upcoming

Aequitas Research puts out a weekly update on the deals that have been covered by Smartkarma Insight Providers recently, along with updates for upcoming IPOs.

This week’s Hong Kong IPO listings breathed life into the exchange as China Tobacco International (HK) (6055 HK) and Hansoh Pharmaceutical (3692 HK)‘s performed exceptionally well on debut, closing 40% and 36% above their respective IPO price for the week.

That said, not all IPOs had a good debut. China East Education (667 HK)‘s IPO flopped despite being the biggest education IPO in Hong Kong this year and was reported earlier that its books were covered on the second day of bookbuild.

Tai Hing (6811 HK)‘s IPO also took a hit, opening 17% below its IPO price. As per our valuation note, we thought that the IPO would only have been attractive from a valuation perspective at the bottom end of its IPO price range, hence, Wednesday’s low debut price presented a good opportunity to accumulate a position for near-term recovery.

Jinxin Fertility Co Ltd (1951 HK) is looking to close its books early. The IPO boasts Orbimed, Hillhouse, and Ally Bridge among its cornerstone investors. The three investors had also participated in Hansoh Pharma’s IPO which performed exceptionally well. Another potential IPO that is moving fast is Alibaba Group Holding (BABA US) which is said to have filed for Hong Kong listing which could raise up to US$20bn. 

On the other hand, ESR Cayman (ESR HK) pulled its Hong Kong IPO citing market condition as the reason. This was not totally unexpected as Sumeet Singh pointed out in his valuation note, ESR Cayman IPO – Richly Valued, that while it is a good company, implied valuation looks a tad too expensive and deal dynamics did not inspire confidence. Hopefully, the IPO will relaunch at a more sensible valuation.

In other countries, Thailand seems to be the most active of all. Asset World Corporation, owned by Charoen Sirivadhanabhakdi, will be looking to IPO in the second half of the year while Index Living Mall, a furniture and home-decoration retailer, is looking to list in the third quarter of 2019.

Accuracy Rate:

Our overall accuracy rate is 72.3% for IPOs and 63.8% for Placements 

(Performance measurement criteria is explained at the end of the note)

New IPO filings this week

  • Shenzhen Leoking (Hong Kong, US$100m)

Below is a snippet of our IPO tool showing upcoming events for the next week. The IPO tool is designed to provide readers with timely information on all IPO related events (Book open/closing, listing, initiation, lock-up expiry, etc) for all the deals that we have worked on. You can access the tool here or through the tools menu.

Source: Aequitas Research, Smartkarma

News on Upcoming IPOs

Analysis on Upcoming IPOs

NameInsight
Hong Kong
AB InbevAb InBev Asia Pre-IPO – A Brief History of the Asia Pacific Operations – Eeking Out Growth in China
AB InbevAb InBev Asia Pre-IPO – Quick Note – More like CR Beer Rather than Tsingtao
AB InbevAb InBev Asia Pre-IPO – On Its Way to Potentially Being the Biggest HK IPO This Year
AB Inbev

Budweiser Brewing APAC Pre-IPO – It Will Be a US$5bn+ Raise Owing to Its Clean Balance Sheet

AB Inbev

Budweiser Brewing Company APAC Pre-IPO – Country Performance and Updated Peer Comparison

AB Inbev

Budweiser Brewing Company APAC Pre-IPO – Refining Valuation for the Diverging Growth Prospects

AscentageAscentage Pharma (亚盛医药) IPO: Too Early for an IPO
Ant FinancialAnt Financial IPO Early Thought: Understand Fintech Empire, Growth & Risk Factors
CIMC VehCIMC Vehicle (中集车辆): Market Leader of Semi-Trailers but Little Growth Ahead
ClarityClarity Medical (清晰医疗) IPO: Proxy to HK SMILE Surgery Demand
ByteDance

ByteDance (字节跳动) IPO: How Jinri Toutiao Paves The Way for a Bigger Empire (Part 1)

ByteDance

ByteDance (字节跳动) IPO: Tiktok the No.1 Short Video App for a Good Reason (Part 2)

Helenbergh

Helenbergh (海伦堡) Early Thoughts – The Usual Red Flag – Related Party Transactions

Hut Chi-Med

Hutchison-China Med (和黄医药) H-Share Listing: MNC Partnerships Endorsed Its R&D Capabilities

Jinxin

Jinxin Fertility (锦欣生殖) Pre-IPO: Strong Foothold in Sichuan but Weak Sentiment for Sector

MicuRxMicuRx Pharma (盟科医药) IPO: Betting on Single Drug in the Not so Attractive Antibiotic Segment
SH Henlius

Shanghai Henlius (复宏汉霖) IPO: Not an Impressive Biosimilar Portfolio 

SH Henlius

Shanghai Henlius (复宏汉霖) IPO: Valuation of Four Biosimilars

TubatuTubatu Group Pre-IPO – Performing Better than Qeeka but Growing Much Slower, US$1bn a Stretch
TubatuTubatu Group Pre-IPO – Online -> Online + Offline -> Online -> ?
South Korea
KMH ShillaKMH Shilla Leisure IPO Preview (Part 1) – Highly Profitable Operator of Public Golf Courses in Korea
KMH ShillaKMH Shilla Leisure IPO Preview (Part 2) – Valuation Analysis
Plakor

Plakor IPO Preview (Part 1)

ZinusZinus IPO Preview (Part 1) – An Amazing Comeback Story (#1 Mattress Brand on Amazon)
India
Aakash EduAakash Education Pre-IPO – Fast Growth in an Attractive Sector
Anmol IndAnmol Industries Pre-IPO Quick Take – No Growth, Generous Payments to Founders
Bharat Hotels

Bharat Hotels Pre-IPO – Catching up with Peers 

CMS InfoCMS Info Systems Pre-IPO – When a PE Sells to Another PE… Only One Gets the Timing Right
Crystal CropCrystal Crop Protection Pre-IPO – DRHP Raises More Questions than in Answers
Flemingo Flemingo Travel Retail Pre-IPO – Its a Different Business in Every Country
NSENSE IPO Preview- Not Only Fast..its Risky and Expensive
NSENational Stock Exchange Pre-IPO Review – Bigger, Better, Stronger but a Little Too Fast for Some
MazagonMazagon Dock IPO Preview: A Monopoly Submarine Yard in India with Captive Navy Spending
Mrs. BectorMrs. Bectors Food Specialities Pre-IPO Quick Take – Sales for Its Main Segment Have Been Sta

Lodha

Lodha Developers Pre-IPO – Second Time Lucky but Not Really that Much Affordable
LodhaLodha Developers IPO: Presence in Affordable Segment Saves Lodha the Blushes in a Sluggish Mkt
IndiaMartIndiaMART Pre-IPO – Getting and Retaining Subscribers Seems to Be Difficult
PNB MetPNB Metlife Pre-IPO Quick Take – Doesn’t Stack up Well Versus Its Larger Peers
Malaysia
QSRQSR Brands Pre-IPO – As Healthy as Fast Food
The U.S
DouyuDouyu (斗鱼直播) IPO: Leader At a Cost
DouyuDouyu (斗鱼直播) IPO: Comparison with Huya (Part 2)
MetenMeten International Edu (美联国际教育) Early Thoughts – Unclear Strategies
Wanda SportsWanda Sports (万达体育) Early Thoughts – Convoluted by Contracts and Cyclicality

3. Jinxin Fertility Group IPO: Valuation Reasonable for the Trade-Offs

Forecast

Jinxin Fertility Co Ltd (1951 HK) is a leading assisted reproductive service (ARS) provider in China and the US. It announced its IPO price range of HK$7.76-8.54 per share. At the mid-point of the IPO price range, Jinxin will raise net proceeds of HK$2.7 billion ($341 million), resulting in a market cap of HK$19.4 billion ($2.5 billion).

In our IPO initiation note, we cautioned that while Jinxin’s investment story has the elements of an attractive growth story, it also has negatives which need to be considered.  Overall, our valuation analysis suggests that the Jinxin IPO is attractive at the proposed IPO price range. 

Get Straight to the Source on Smartkarma

Smartkarma supports the world’s leading investors with high-quality, timely, and actionable Insights. Subscribe now for unlimited access, or request a demo below.



Brief Hong Kong: Budweiser Brewing Company APAC IPO: A Solid PHIP Update and more

By | Daily Briefs, Hong Kong

In this briefing:

  1. Budweiser Brewing Company APAC IPO: A Solid PHIP Update
  2. ECM Weekly (15 Jun 2019) – Budweiser Brewing Co, Jinxin Fertility, Wanda Sports, Hansoh Pharma
  3. Jinxin Fertility Group IPO: Valuation Reasonable for the Trade-Offs
  4. Budweiser Brewing Company APAC Pre-IPO – Refining Valuation for the Diverging Growth Prospects

1. Budweiser Brewing Company APAC IPO: A Solid PHIP Update

Volume

Budweiser Hong Kong Holding (0338867D HK)/Budweiser APAC is Anheuser Busch Inbev Sa/Nv (ABI BB)’s Asian business and is the largest beer company by retail sales value based in the Asia Pacific, according to GlobalData. On Thursday, Budweiser APAC received HKEX approval for a Hong Kong IPO to raise $5-10 billion, according to press reports.

In our IPO initiation note, we concluded that Budweiser APAC fundamentals are strong. The PHIP update which outlines 1Q19 financials reinforces our view).

2. ECM Weekly (15 Jun 2019) – Budweiser Brewing Co, Jinxin Fertility, Wanda Sports, Hansoh Pharma

Upcoming

Aequitas Research puts out a weekly update on the deals that have been covered by Smartkarma Insight Providers recently, along with updates for upcoming IPOs.

This week’s Hong Kong IPO listings breathed life into the exchange as China Tobacco International (HK) (6055 HK) and Hansoh Pharmaceutical (3692 HK)‘s performed exceptionally well on debut, closing 40% and 36% above their respective IPO price for the week.

That said, not all IPOs had a good debut. China East Education (667 HK)‘s IPO flopped despite being the biggest education IPO in Hong Kong this year and was reported earlier that its books were covered on the second day of bookbuild.

Tai Hing (6811 HK)‘s IPO also took a hit, opening 17% below its IPO price. As per our valuation note, we thought that the IPO would only have been attractive from a valuation perspective at the bottom end of its IPO price range, hence, Wednesday’s low debut price presented a good opportunity to accumulate a position for near-term recovery.

Jinxin Fertility Co Ltd (1951 HK) is looking to close its books early. The IPO boasts Orbimed, Hillhouse, and Ally Bridge among its cornerstone investors. The three investors had also participated in Hansoh Pharma’s IPO which performed exceptionally well. Another potential IPO that is moving fast is Alibaba Group Holding (BABA US) which is said to have filed for Hong Kong listing which could raise up to US$20bn. 

On the other hand, ESR Cayman (ESR HK) pulled its Hong Kong IPO citing market condition as the reason. This was not totally unexpected as Sumeet Singh pointed out in his valuation note, ESR Cayman IPO – Richly Valued, that while it is a good company, implied valuation looks a tad too expensive and deal dynamics did not inspire confidence. Hopefully, the IPO will relaunch at a more sensible valuation.

In other countries, Thailand seems to be the most active of all. Asset World Corporation, owned by Charoen Sirivadhanabhakdi, will be looking to IPO in the second half of the year while Index Living Mall, a furniture and home-decoration retailer, is looking to list in the third quarter of 2019.

Accuracy Rate:

Our overall accuracy rate is 72.3% for IPOs and 63.8% for Placements 

(Performance measurement criteria is explained at the end of the note)

New IPO filings this week

  • Shenzhen Leoking (Hong Kong, US$100m)

Below is a snippet of our IPO tool showing upcoming events for the next week. The IPO tool is designed to provide readers with timely information on all IPO related events (Book open/closing, listing, initiation, lock-up expiry, etc) for all the deals that we have worked on. You can access the tool here or through the tools menu.

Source: Aequitas Research, Smartkarma

News on Upcoming IPOs

Analysis on Upcoming IPOs

NameInsight
Hong Kong
AB InbevAb InBev Asia Pre-IPO – A Brief History of the Asia Pacific Operations – Eeking Out Growth in China
AB InbevAb InBev Asia Pre-IPO – Quick Note – More like CR Beer Rather than Tsingtao
AB InbevAb InBev Asia Pre-IPO – On Its Way to Potentially Being the Biggest HK IPO This Year
AB Inbev

Budweiser Brewing APAC Pre-IPO – It Will Be a US$5bn+ Raise Owing to Its Clean Balance Sheet

AB Inbev

Budweiser Brewing Company APAC Pre-IPO – Country Performance and Updated Peer Comparison

AB Inbev

Budweiser Brewing Company APAC Pre-IPO – Refining Valuation for the Diverging Growth Prospects

AscentageAscentage Pharma (亚盛医药) IPO: Too Early for an IPO
Ant FinancialAnt Financial IPO Early Thought: Understand Fintech Empire, Growth & Risk Factors
CIMC VehCIMC Vehicle (中集车辆): Market Leader of Semi-Trailers but Little Growth Ahead
ClarityClarity Medical (清晰医疗) IPO: Proxy to HK SMILE Surgery Demand
ByteDance

ByteDance (字节跳动) IPO: How Jinri Toutiao Paves The Way for a Bigger Empire (Part 1)

ByteDance

ByteDance (字节跳动) IPO: Tiktok the No.1 Short Video App for a Good Reason (Part 2)

Helenbergh

Helenbergh (海伦堡) Early Thoughts – The Usual Red Flag – Related Party Transactions

Hut Chi-Med

Hutchison-China Med (和黄医药) H-Share Listing: MNC Partnerships Endorsed Its R&D Capabilities

Jinxin

Jinxin Fertility (锦欣生殖) Pre-IPO: Strong Foothold in Sichuan but Weak Sentiment for Sector

MicuRxMicuRx Pharma (盟科医药) IPO: Betting on Single Drug in the Not so Attractive Antibiotic Segment
SH Henlius

Shanghai Henlius (复宏汉霖) IPO: Not an Impressive Biosimilar Portfolio 

SH Henlius

Shanghai Henlius (复宏汉霖) IPO: Valuation of Four Biosimilars

TubatuTubatu Group Pre-IPO – Performing Better than Qeeka but Growing Much Slower, US$1bn a Stretch
TubatuTubatu Group Pre-IPO – Online -> Online + Offline -> Online -> ?
South Korea
KMH ShillaKMH Shilla Leisure IPO Preview (Part 1) – Highly Profitable Operator of Public Golf Courses in Korea
KMH ShillaKMH Shilla Leisure IPO Preview (Part 2) – Valuation Analysis
Plakor

Plakor IPO Preview (Part 1)

ZinusZinus IPO Preview (Part 1) – An Amazing Comeback Story (#1 Mattress Brand on Amazon)
India
Aakash EduAakash Education Pre-IPO – Fast Growth in an Attractive Sector
Anmol IndAnmol Industries Pre-IPO Quick Take – No Growth, Generous Payments to Founders
Bharat Hotels

Bharat Hotels Pre-IPO – Catching up with Peers 

CMS InfoCMS Info Systems Pre-IPO – When a PE Sells to Another PE… Only One Gets the Timing Right
Crystal CropCrystal Crop Protection Pre-IPO – DRHP Raises More Questions than in Answers
Flemingo Flemingo Travel Retail Pre-IPO – Its a Different Business in Every Country
NSENSE IPO Preview- Not Only Fast..its Risky and Expensive
NSENational Stock Exchange Pre-IPO Review – Bigger, Better, Stronger but a Little Too Fast for Some
MazagonMazagon Dock IPO Preview: A Monopoly Submarine Yard in India with Captive Navy Spending
Mrs. BectorMrs. Bectors Food Specialities Pre-IPO Quick Take – Sales for Its Main Segment Have Been Sta

Lodha

Lodha Developers Pre-IPO – Second Time Lucky but Not Really that Much Affordable
LodhaLodha Developers IPO: Presence in Affordable Segment Saves Lodha the Blushes in a Sluggish Mkt
IndiaMartIndiaMART Pre-IPO – Getting and Retaining Subscribers Seems to Be Difficult
PNB MetPNB Metlife Pre-IPO Quick Take – Doesn’t Stack up Well Versus Its Larger Peers
Malaysia
QSRQSR Brands Pre-IPO – As Healthy as Fast Food
The U.S
DouyuDouyu (斗鱼直播) IPO: Leader At a Cost
DouyuDouyu (斗鱼直播) IPO: Comparison with Huya (Part 2)
MetenMeten International Edu (美联国际教育) Early Thoughts – Unclear Strategies
Wanda SportsWanda Sports (万达体育) Early Thoughts – Convoluted by Contracts and Cyclicality

3. Jinxin Fertility Group IPO: Valuation Reasonable for the Trade-Offs

Forecast

Jinxin Fertility Co Ltd (1951 HK) is a leading assisted reproductive service (ARS) provider in China and the US. It announced its IPO price range of HK$7.76-8.54 per share. At the mid-point of the IPO price range, Jinxin will raise net proceeds of HK$2.7 billion ($341 million), resulting in a market cap of HK$19.4 billion ($2.5 billion).

In our IPO initiation note, we cautioned that while Jinxin’s investment story has the elements of an attractive growth story, it also has negatives which need to be considered.  Overall, our valuation analysis suggests that the Jinxin IPO is attractive at the proposed IPO price range. 

4. Budweiser Brewing Company APAC Pre-IPO – Refining Valuation for the Diverging Growth Prospects

Valuation

Budweiser Brewing Company APAC (0338867D HK) (ABIAPAC) is looking to raise US$5bn+ in its Hong Kong IPO, which would make it one of the largest Hong Kong IPO’s this year.

I’ve covered the background and financial performance for the Asian operations in my earlier insights: 

In this insight, I’ll talk about the company valuations based on the different growth prospects for its geographic segments. 

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Brief Hong Kong: Budweiser Brewing Company APAC Limited Pre-IPO – Country Performance and Updated Peer Comparison and more

By | Daily Briefs, Hong Kong

In this briefing:

  1. Budweiser Brewing Company APAC Limited Pre-IPO – Country Performance and Updated Peer Comparison

1. Budweiser Brewing Company APAC Limited Pre-IPO – Country Performance and Updated Peer Comparison

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Budweiser Brewing Company APAC (0338867D HK) (ABIAPAC) is looking to raise US$5bn+ in its Hong Kong IPO, which would make it one of the largest Hong Kong IPO’s this year.

I’ve covered the background and financial performance for the Asian operations in my earlier insights: 

In my earlier insight, I had looked at the geographic split as provided by the company in its application proof. In this insight, I’ll piece together data from the parent’s earlier filings to  comment on the country level dynamics. I’ll also provide an updated comparison with its Chinese players based on the above findings.

Get Straight to the Source on Smartkarma

Smartkarma supports the world’s leading investors with high-quality, timely, and actionable Insights. Subscribe now for unlimited access, or request a demo below.