In today’s briefing:
- Sany Heavy Industries A/H IPO Pricing – Thoughts on Valuations
- Remegen (9995 HK): Index Inclusion as Sector Starts to Drop
- Sany Heavy Industry IPO in Hong Kong
- Zijin Gold (2259 HK) 25Q3 – Updates on Forecast/Valuation and Potential Risks Behind
- Sany Heavy Industry IPO: Valuation Assessment
- JST Group IPO Trading: Strong Insti and Retail Demand
- Geely (175 HK): Possible to Beat BYD – Contrast of September Deliveries
- Bama Tea (BAMA HK) IPO: Franchise Driven Branded Volume Play Model Will Compensate Foregone Margins
- Binhui Biopharm (滨会生物) Pre-IPO Quick Take: High Innovation but Niche Indications
- Cross-Market Outlook: US Vs Asia — Who’s Overbought, Who’s Oversold?
Sany Heavy Industries A/H IPO Pricing – Thoughts on Valuations
- Sany Heavy Industry (600031 CH) aims to raise around US$1.6bn in its H-share listing.
- Sany Heavy Industry was the world’s third largest and China’s largest construction machinery company in terms of construction machinery’s cumulative revenue from 2020 to 2024, according to Frost & Sullivan.
- We have looked at the past performance and likely A/H premium in our previous note. In this note, we talk about the IPO pricing.
Remegen (9995 HK): Index Inclusion as Sector Starts to Drop
- After a huge upward move earlier this year, Remegen (9995 HK)‘s stock has started to drop as the sector starts to give back some of its gains.
- Despite the recent correction, Remegen (9995 HK) should be added to a global index in November and that could help the stock outperform its peers.
- There appears to be a lot of positioning in the stock, but we see a similar trend across stocks in the industry.
Sany Heavy Industry IPO in Hong Kong
- Sany Heavy Industry is getting ready for an IPO listing in Hong Kong. It is targeting up to HK$12.36 billion (US$1.59 billion) by offering 580.42 million shares in this listing.
- The IPO price of Sany Heavy is set between HK$20.30 and HK$21.30, with the final price to be determined on Friday.
- Sany Heavy is the largest construction machinery manufacturer in China and third largest globally. Its main products include excavators, concrete equipment, hoisting and piling machines, and road construction equipment.
Zijin Gold (2259 HK) 25Q3 – Updates on Forecast/Valuation and Potential Risks Behind
- Zijin Gold showed strong growth momentum in 25Q1-Q3, mainly driven by high gold prices and the two major acquisitions of the Ghana Akyem Gold Mine and Kazakhstan Raygorodok Gold Mine.
- Based on 25Q1-Q3 results, we updated our forecast of Zijin Gold, with net profit to reach US$1.5 billion/US$2.3 billion/US$3.5 billion in 2025/2026/2027, respectively.Theoretically speaking, valuation still has positive upside potential.
- However, our greatest concern is not the fundamental factors but the selling caused by liquidity crisis, which may lead to a synchronous correction of Zijin when the global market declines.
Sany Heavy Industry IPO: Valuation Assessment
- Sany Heavy Industry (600031 CH)‘s IPO price range is set at HK$20.3-21.3, aiming at raising HK$11.9bn based on the mid-point IPO price.
- Key strengths are excellent growth potential globally, a leading market position, excellent R&D capability, and a solid financial track record.
- Sany Heavy’s fair valuation is a 5-10% discount to its A-share, in our view, implying an H-share price of HK$22.06-23.29, leaving limited upside from the IPO level.
JST Group IPO Trading: Strong Insti and Retail Demand
- JST Group (6687 HK) raised around US$270m in its HK IPO.
- It is China’s largest and most popular e-commerce SaaS ERP provider.
- We have covered various aspects of the deal in our previous note. In this note, we will talk about the demand and trading dynamics.
Geely (175 HK): Possible to Beat BYD – Contrast of September Deliveries
- BYD is still the largest sedan maker in China, but its deliveries began to decline.
- Geely is the second largest car maker, but its deliveries surged dramatically.
- We believe Geely is the most promising company when the sedan market gets concentrated.
Bama Tea (BAMA HK) IPO: Franchise Driven Branded Volume Play Model Will Compensate Foregone Margins
- Bama Tea (BAMA HK) launched its Hongkong IPO aiming to raise up to HK$368M. The company plans to sell 9M shares at HK$45-$50 per share.
- Bama Tea is a provider of tea leaf products in China, covering all six major types of tea leaves in China and non-tea-leaf products such as tea-ware and tea snacks.
- Amidst the highly fragmented tea consumption market Bama Tea relies on a volume play model with its branded offerings. We would recommend the investors to subscribe to the issue.
Binhui Biopharm (滨会生物) Pre-IPO Quick Take: High Innovation but Niche Indications
- Binhui, a China-based clinical-stage biopharma company, is looking to raise at least USD 100 million via a Hong Kong listing. Huatai, CMB, and BOCI are the joint sponsors.
- In this note, we look at the company’s core product, BS001, and key products BS006 and BR003.
- We also look at the company’s pre-IPO investors and management team.
Cross-Market Outlook: US Vs Asia — Who’s Overbought, Who’s Oversold?
- A look at our probabilistic tactical models for US and Asian Equities: comparing which stocks are overbought and which ones are oversold.
- Between the US Stocks we track, all seems to have room to rally, short-term, and Amazon (AMZN US) is actually oversold (buy opportunity).
- The Asian Stocks we track instead show a less homogeneous picture, but several Asian stocks are incredibly overbought. Same as Gold.
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