In today’s briefing:
- HSI, HSCEI, HSTECH, HSIII Index Rebalance: US$5.3bn of Flows Post Capping (Mar 2025)
- StubWorld: Cheung Kong’s Geopolitics
- BYD (1211 HK) Placement: Tactical Buy Opportunity in Key Support Zone
- Ping An Good Doctor (1833 HK) – The Mandatory General Offer and DeepSeek Story May Not Turn the Tide
- It’s Been a Tough Two+ Years for SHEIN & Its Investors, & Things Don’t Get Easier From Here
- Seeking Stability and Certainty in a World of Chaos: Link REIT
- Lucror Analytics – Morning Views Asia
- Zhejiang Sanhua Intelligent Controls A/H Listing – Strong Track Record
HSI, HSCEI, HSTECH, HSIII Index Rebalance: US$5.3bn of Flows Post Capping (Mar 2025)
- The March rebalance of the HSI, HSCEI INDEX, HSTECH and HSIII indices will use today’s closing prices to cap the index constituent weights at 8%/12%. This leads to large flows.
- The gross round-trip trade across all stocks across the four indices is estimated at HK$41.1bn (US$5.3bn). The net round-trip trade is HK$37.3bn (US$4.8bn).
- Meituan , JD.com, Baidu, Horizon Robotics, ICBC, BeiGene, Kuaishou Technology and China Construction Bank are the largest buys. Alibaba, Xiaomi, HSBC, ZhongAn Online and Tencent are the largest sells.
StubWorld: Cheung Kong’s Geopolitics
- CK Hutchison Holdings (1 HK) (CKH) is trading “cheap” as Panama’s Supreme Court agrees to consider a request to nullify CKH’s canal concessions.
- Preceding my comments on CKH, CK Infrastructure Holdings (1038 HK) (coming up cheap on my monitor), and Power Assets Holdings (6 HK) are the current setup/unwind tables for Asia-Pacific Holdcos.
- These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation >20%.
BYD (1211 HK) Placement: Tactical Buy Opportunity in Key Support Zone
- As recently written by Brian Freitas and Sumeet Singh , BYD (1211 HK) is placing new shares on the market at at a price range of HK$333-345/share.
- The stock today dropped to roughly 340 and it’s oversold WEEKLY according to our models. Buying here, at this price, should bear fruit in coming weeks. More details below.
- We cannot yet predict the profit targets because our model needs the WEEKLY Close for this week, to do that. We will update this information when it becomes available.
Ping An Good Doctor (1833 HK) – The Mandatory General Offer and DeepSeek Story May Not Turn the Tide
- Recent surge of share price is driven by the craze for DeepSeek/AI in digital healthcare, not the improvement of fundamentals or effective validation of business model.So, the rally won’t last.
- Although AI is a great story, the extent to which DeepSeek can bring substantial benefits to PAGD remains to be verified. Small revenue scale may lead to low valuation premium.
- PAGD is expected to turn loss into profits in 2024. Short-term valuation should be lower than peers. When PAGD achieve profitability/revenue in large scale, P/B would approach the industry average.
It’s Been a Tough Two+ Years for SHEIN & Its Investors, & Things Don’t Get Easier From Here
- Over the last 25 months, there’s been a steady stream of bad news for DTC platform SHEIN
- The latest challenges: US tariff chaos & Amazon’s launch of its competing platform, Haul
- Tariff changes & growth of Haul could mean SHEIN IPO gets done at fraction of 2023 valuation
Seeking Stability and Certainty in a World of Chaos: Link REIT
- Link REIT, as the largest REIT in Asia, owns a well diversified portfolio which provides visibility and certainty to its future growth
- Given the stable fundamentals in Hong Kong, we think the REIT is over-penalized by the market, which presents an attractive entry point
- Valuation is not demanding, we think it is a good opportunity for long-term investor
Lucror Analytics – Morning Views Asia
- In the US, the ISM manufacturing index edged down to 50.3 (50.7 e / 50.9 p) in February.
- This was on account of a contraction in the new orders and employment components, which were offset somewhat by a sharp increase in the prices paid component.
- Meanwhile, the February (final) S&P manufacturing PMI rose to 52.7 (51.2 p), above the preliminary estimate of 51.6.
Zhejiang Sanhua Intelligent Controls A/H Listing – Strong Track Record
- Zhejiang Sanhua Intellignt Controls Co., Ltd. (002050 CH) (ZSIC), a manufacturer of refrigeration and air-conditioning control components, aims to raise around US$1bn in its H-share listing.
- ZSIC is a market leader in a number of products, with commanding market share both domestically and globally.
- In this note, we look at its past performance and other deal dynamics that might impact the listing.
💡 Before it’s here, it’s on Smartkarma
Sign Up for Free
The Smartkarma Preview Pass is your entry to the Independent Investment Research Network
- ✓ Unlimited Research Summaries
- ✓ Personalised Alerts
- ✓ Custom Watchlists
- ✓ Company Data and News
- ✓ Events & Webinars
