In today’s briefing:
- China Hongqiao (1378 HK): Index Impact of US$1.2bn Placement
- Hang Seng Index (HSI) Rebalance Preview: Inclusion Candidates for Dec25
- Alibaba (9988 HK / BABA US): Brace for a Big Earnings Move
- China Hongqiao Placement: Good Valuation but Likely Opportunistic, on the Back of Chuangxin Listing
- Chuangxin Pre-IPO: Increasing Exposure to Volatile Alumina; Offered at Premium to Peers
- Jinke Smart (9666 HK): Boyu Changes Up And Now Seeks Delisting
- HK Connect SOUTHBOUND Flows (Wk To 14 Nov 2025) – Strong SOE/Energy/Financials Buying on BABA Sales
- CATL IPO Lockup – US$5.3bn Lockup Release, with H-Shares at Significant Premium to A-Shares
- BYD (1211 HK): Leverage Softening Fundamentals with Short Calls
- Baidu Declares Chip War With Huawei & Nvidia—Is China Backing It?
China Hongqiao (1378 HK): Index Impact of US$1.2bn Placement
- 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.
Hang Seng Index (HSI) Rebalance Preview: Inclusion Candidates for Dec25
- 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 / BABA US): Brace for a Big Earnings Move
- 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 Placement: Good Valuation but Likely Opportunistic, on the Back of Chuangxin Listing
- 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 Pre-IPO: Increasing Exposure to Volatile Alumina; Offered at Premium to Peers
- 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.
Jinke Smart (9666 HK): Boyu Changes Up And Now Seeks Delisting
- 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 Connect SOUTHBOUND Flows (Wk To 14 Nov 2025) – Strong SOE/Energy/Financials Buying on BABA Sales
- 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 IPO Lockup – US$5.3bn Lockup Release, with H-Shares at Significant Premium to A-Shares
- 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.
BYD (1211 HK): Leverage Softening Fundamentals with Short Calls
- 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 Declares Chip War With Huawei & Nvidia—Is China Backing It?
- 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.
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