In today’s briefing:
- A/H Premium Tracker (To 25 July 2025): “Beautiful Skew” Raging Onward
- GF Securities (1776 HK): Global Index Inclusion as Sector Rallies
- HK Connect SOUTHBOUND Flows (To 25 July 2025); Multi-Month High Volumes, Net Buying of Financials
- Laopu Gold (6181 HK): Strong Earnings, Soft Share Price – What’s Driving the Disconnect?
- Anta (2020 HK): Company Estimates Higher Growth Due to Acquisition
- Eastroc Beverage Group – High Growth in 25H1 Continues but Concerns Begin to Emerge
- Jiangsu Hengrui Pharmaceuticals (1276 HK): Is HRS-9821 Licensing Deal with GSK Good Enough?
A/H Premium Tracker (To 25 July 2025): “Beautiful Skew” Raging Onward
- AH premia down again among liquid names but “beautiful skew” of wide premia converging more than narrow premia continues bigly. It still pays well to be long wide H discounts.
- This is the most significant 60-day AH pair average H outperformance in five years, maybe ever. Remarkable.
- The data tables below update on a daily basis in the Tools section of Smartkarma. The SOUTHBOUND Flow Monitor and AH Monitor are both there free for SK readers.
GF Securities (1776 HK): Global Index Inclusion as Sector Rallies
- Following a rally in the stock over the last 4 months, GF Securities (H) (1776 HK) could be added to a global index in August.
- GF Securities (H) (1776 HK)‘ peers have also rallied over the same time frame and the stock trades in line with its peers on various valuation metrics.
- Positioning in the stock is in line with its peers and shorts have continued to increase as the stock price has moved higher.
HK Connect SOUTHBOUND Flows (To 25 July 2025); Multi-Month High Volumes, Net Buying of Financials
- Gross SOUTHBOUND volumes US$20+bn a day this past 5-day week. Best in months. Net buying strong at +US$800mm a day.
- Among the top buys as a percentage of volume, Non-bank FINANCIALS stood out, dramatically. Tech-y CONSUMER DISCRETIONARY was sold. SOEs stand out on the sell side. Again.
- The data tables below update on a daily basis in the Tools section of Smartkarma. The SOUTHBOUND Flow Monitor and AH Monitor are both there free for SK readers.
Laopu Gold (6181 HK): Strong Earnings, Soft Share Price – What’s Driving the Disconnect?
- Laopu Gold (6181 HK)’s stock has fallen nearly 30% since its July 8 peak and declined another 4% yesterday despite an upbeat 1H2025 profit update.
- The company’s positive profit alert reported revenues and profits up more than 2.5x year-on-year, exceeding market expectations.
- The ongoing share price weakness despite strong results likely reflects a combination of technical factors, such as lock-up related selling, and broader fundamental concerns.
Anta (2020 HK): Company Estimates Higher Growth Due to Acquisition
- Anta expects “other brands” revenue will increase by “60-65%” YoY in 1H25.
- We believe Anta finished the consolidation of Jack Wolfskin within June.
- We conclude the stock will have an upside of 28% for the next twelve months.
Eastroc Beverage Group – High Growth in 25H1 Continues but Concerns Begin to Emerge
- Both revenue and net profit of Eastroc maintain a high-speed growth trend in 25H1, which is impressive against the backdrop of the overall stabilization of the food and beverage industry.
- The mid-term dividend payout ratio is high, which is relatively rare among growth-oriented food and beverage companies. Valuation of Eastroc should be higher than Nongfu Spring, China Resources Beverage.
- However, inflation may drive up raw material prices. Eastroc’s profit may face pressure once products sales fail to grow as fast as expected.We updated our forecast for next three years
Jiangsu Hengrui Pharmaceuticals (1276 HK): Is HRS-9821 Licensing Deal with GSK Good Enough?
- Jiangsu Hengrui Pharmaceuticals (1276 HK) entered into agreements with GSK, granting an exclusive worldwide right of HRS-9821, a small molecule, PDE3/PDE4 inhibitor in clinical development for the treatment of COPD.
- The only similar products available worldwide is Verona Pharma’s Ohtuvayre (ensifentrine) which was approved for marketing by the FDA in June 2024 for maintenance therapy of COPD.
- The COPD segment has seen increased activity over the last one year in terms of drug approvals, acquisitions, and licensing agreements. This reiterates the growing potential of the COPD market.
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