In today’s briefing:
- MIXUE IPO – Decent Cornerstone, past Sentiment Overhang
- MIXUE Group (2097 HK) IPO: The Bull Case
- Mixue Group IPO: Value For Money Pricing and Attractive Valuations
- [Baidu, Inc. (BIDU US, SELL, TP US$80) TP Change]: AI Monetization by How Much & At What Cost?
- Genuine Biotech (真实生物) Pre-IPO Tearsheet
- Lucror Analytics – Morning Views Asia
- Asia Real Estate Tracker (21-Feb-2025): Brookfield sells Sydney complex for $210M
- Major Top for the U.S. Dollar (DXY) = Risk-On; Bullish Outlook Despite Near-Term Downside Risk
- CaiNiao Q3FY: Revenue Declines Y/Y, Margins, Too | X-Border Logistics Pricing Under Intense Pressure
MIXUE IPO – Decent Cornerstone, past Sentiment Overhang
- Mixue Group is now looking to raise around US$450m in its upcoming Hong Kong IPO.
- MIXUE Group (MIXUE) is a freshly-made drinks company providing affordable products to consumers, including freshly-made fruit drinks, tea, ice cream and coffee, typically priced at around one USD per item.
- We have covered various aspects of the deal in our previous notes. In this note, we will talk about the IPO pricing.
MIXUE Group (2097 HK) IPO: The Bull Case
- Mixue Group (MIX HK), a world-leading manufacturer of freshly made drinks, is seeking to raise US$445 million through an HKEx IPO.
- According to CIC, Mixue is the largest freshly made drinks company in China and worldwide, according to the number of stores as of September 30, 2024.
- The bull case rests on a strong brand, leading market share, peer-leading revenue growth, top-tier profitability and cash generation.
Mixue Group IPO: Value For Money Pricing and Attractive Valuations
- Mixue Group (MIX HK) is offering 17.06 million shares at HK$202.50 apiece to raise HK$3.45 billion ($444 million) in its initial public offering in Hong Kong
- Mixue’s IPO was launched today morning and will close on Wednesday 26th February. The stock is due to list on HK bourses on 3rd March.
- Mixue, China’s value-for-money freshly made beverage leader, has priced its IPO shares attractively given its robust growth track record and long term competitive strengths.
[Baidu, Inc. (BIDU US, SELL, TP US$80) TP Change]: AI Monetization by How Much & At What Cost?
- BIDU reported C4Q24 top line, non-GAAP op. profit and GAAP net income in-line, (22%) and (7.0%) vs. our est. and (3.7%), (24%) and in line vs. cons.
- While monetization on a largely in-house app repertoire can ensure AI revenue to start kicking in in C2H25, we are concerned on the size of this revenue,
- We maintain our SELL but raise TP to US$80 to reflect a short-term trading opportunity around AI monetization.
Genuine Biotech (真实生物) Pre-IPO Tearsheet
- Genuine Biotech is looking to raise at least US$100 million via a Hong Kong listing.
- Genuine Biotech has commercialized product and is expanding indication of its core product from HIV to cancer.
- The company’s founder has experience of R&D in the relevant area in leading NMCs.
Lucror Analytics – Morning Views Asia
- In the US, the Conference Board leading economic index fell 0.3% (-0.1% e / 0.1% revised p) to 101.5 in January.
- Overall, the index recorded a 0.9% decline in the six months ended January 2025, which was lower than the 1.7% drop over the preceding six months.
- Separately, initial jobless claims for the week ended February 15th edged up to 219 k (215 k e / 214 k revised p).
Asia Real Estate Tracker (21-Feb-2025): Brookfield sells Sydney complex for $210M
- Brookfield has sold a Sydney logistics complex for $210M to Ontario Teachers’, KIC, and Gateway.
- CapitaLand Investment has closed a $130M private credit fund in Korea.
- Sun Hung Kai has bought a $77M residential plot, the cheapest land sale in 11 years in Hong Kong.
Major Top for the U.S. Dollar (DXY) = Risk-On; Bullish Outlook Despite Near-Term Downside Risk
- Our outlook remains bullish on global equities (MSCI ACWI). We’ve been bullish since early-November 2023, save for a two month period from late-July to late-September 2024 when we were neutral.
- We also believe the U.S. dollar (DXY) and Treasury yields have put in major tops, which is a crucial risk-on signal for global equities.
- With more and more countries breaking out, we remain bullish as long as ACWI-US is above $116, S&P 500 is above 5770-5850, and EURO STOXX 50 is above 5030.
CaiNiao Q3FY: Revenue Declines Y/Y, Margins, Too | X-Border Logistics Pricing Under Intense Pressure
- In the December quarter, CaiNiao’s revenue declined -1% Y/Y; EBITA margin fell, too
- CaiNiao’s revenue growth has de-coupled from the growth of Alibaba’s international segment
- We believe price pressure on Chinese X-border logistics exceeds pressure within X-border retail
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