Daily Brief China: ANE Cayman Inc, WuXi AppTec, 360 Finance, Inc., Shanghai Chicmax Cosmetic, Chery Automobile, Hang Seng Bank, Mininglamp Technology, Softcare, Hang Seng Index, Dongfeng Electronic Tech A and more

• 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: Mayne Pharma (MYX AU), Brainpad Inc (3655 JP), Smart Share Global (EM US), AUB Group Limited (AUB AU), ENN Energy (2688 HK), Dongfeng Motor (489 HK).
• Lowest spreads: Bright Smart Securities (1428 HK), Mandom Corp (4917 JP), Pacific Industrial (7250 JP), Seven West Media (SWM AU), Humm Group (HUM AU), Toyota Industries (6201 JP). 

• The 11th national VBP officially started last week. The average price reduction of the selected products is 53%. Due to the “anchor price” mechanism, VBP is becoming increasingly rational.
• The purchasing power of the global pharmaceutical industry on Chinese assets is still far from saturated that we have reason to expect more transactions to come to Chinese pharmaceutical companies.
• Based on WuXi AppTec’s 25Q3 results, CDMO business has emerged from fundamental turning point following the recovery of overseas biotech industry, but the inflection point of CRO is lagging behind.

• QFIN shares are down ~19% MTD on regulatory concerns in China’s consumer finance sector, though the proposed credit-risk sharing rules may only modestly impact near-term RoE (1–3ppt).
• While speculation over a lower NFRA loan yield cap persists, QFIN’s current yield profile suggests limited sensitivity; any tangible financial impact will depend on actual regulation rollout.
• QFIN’s 0.9x P/B reflects overly bearish loss expectations. Even under a bear case with a 5ppt RoE reduction, the stock offers 56% upside, implying a fair value of $34.

• The data in this insight is collated from the “shareholding disclosure” link on the HKEx website.
• Often there is a corresponding HKEx announcement on the increase – or decrease – in the shareholding by directors. 
• However, such disclosures are by no means an absolute. These insights also flag those companies where shares have been pledged, both recently and ongoing.

• Chery’s revenue growth rate plunged below 5% YoY in 3Q25 from 28% YoY in 2Q25.
• Chery’s domestic retail sales volume began to decline in September 2025.
• The company is still the number five largest car maker in China.

• For Oct 2025, 15 new transactions (firm and non-binding) were discussed on Smartkarma (by the Quiddity team) with an overall announced deal size of ~US$33bn.
• The average premium for the new transactions announced (or first discussed) in October was ~54%, with a year-to-date average of ~49%.
• The average premiums for transactions in 2024 (129 transactions), 2023 (117), 2022 (106), 2021 (165), 2020 (158), and 2019 (145 ) were 43%, 39%, 41%, 33%, 31%, and 31%.

• Mininglamp Technology (1912140D HK) raised around US$131m in its Hong Kong IPO.
• Mininglamp Technology (formerly known as Leading Smart Holdings), is a data intelligence software provider in China, specializing in transforming enterprises’ marketing and operational decision-making.
• We have looked at the company’s background and pricing in our earlier note, in this note we talk about the trading dynamics.

• The rise of Softcare is in line with the logic of “Chinese supply chain going global”.It has solved channel/cost problems through localized production, quickly captured market share with low-price tactic.
• Our forecast benefiting from market penetration/capacity expansion, revenue growth could be 15% YoY in 2025.In 2026-2027, as competition intensifies, revenue growth may slow down to 12% YoY, 10% YoY respectively.
• Given that Softcare’s main market is in Africa, which is characterized by high growth and high risk, a forecasted P/E of 8-12x for 2025 could be a comfortable valuation range.

• Implied volatility rose across most markets in October, and a continuing trend in vol premium warrants attention.  
• November has historically produced strong price returns and positive volatility premiums across global markets.
• Implied volatility displays clustering across markets, with two distinct groupings beginning to take shape.

• Dongfeng Electronic Technology (DETC) is a core automotive components supplier within the state-owned Dongfeng Motor Group, heavily reliant on intra-group sales. This relationship provides stable demand but also concentrates risk and limits exposure to the broader, faster-growing segments of the Chinese auto market.
• The company’s financial performance has been challenged, with multi-year declines in revenue, net income, and earnings per share. This reflects significant headwinds in the commercial vehicle sector and increasing competition, pressuring margins and profitability.
• While currently focused on traditional vehicle components, DETC’s future hinges on its ability to pivot towards the New Energy Vehicle (NEV) and intelligent vehicle segments. Strategic initiatives and R&D in areas like electric drive systems and smart cockpits are critical but face intense competition from established and emerging players.

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