In today’s briefing:
- Xtapli Placement – Questionable Timing. An AI Momentum Play, at Best
- Quiddity Leaderboard CSI 300/500 Jun 25: Positive Trade Performance; More to Come
- Mixue Group IPO Preview
- [Baidu, Inc. (BIDU US, SELL, TP US$78) Preview]: Baidu’s Problem Is Deep Rooted and Getting Worse
- Tam Jai Intl (2217 HK): It Seems like Quite Some People Are Unhappy
- Alibaba (9988 HK): How Options Traders Are Navigating the Rally and Volatility. Top Trades.
- Mixue IPO: More than Just Tea. Key Facts, Financials and Analysis
- Quiddity Leaderboard ChiNext & ChiNext 50 Jun25: ~US$1.3bn One-Way; Some Changes to Expectations
- Midea IPO Re-Evaluation
- Asia Real Estate Tracker (18-Feb-2025): ADIA, Hines sell Shanghai Trophy Tower for $1.5B
Xtapli Placement – Questionable Timing. An AI Momentum Play, at Best
- Xtapli is looking to raise around US$242m via a primary placement, after having raised US$145m in Jan 2025.
- QuantumPharm is a R&D platform, utilizing quantum physics-based first-principles calculation, advanced AI, high-performance cloud computing, and scalable and standardized robotic automation to provide drug and material science R&D solutions.
- In this note, we will talk about the placement and run the deal through our ECM framework.
Quiddity Leaderboard CSI 300/500 Jun 25: Positive Trade Performance; More to Come
- CSI 300 represents the 300 largest stocks by market cap and liquidity from the Shanghai and Shenzhen Exchanges. CSI 500 is the next 500 names.
- In this insight, we take a look at the potential ADDs and DELs leading the race for the semiannual index rebal event in June 2025.
- Currently, we see 7 ADDs/DELs for the CSI 300 index and 50 ADDs/DELs for the CSI 500 index.
Mixue Group IPO Preview
- Mixue Group is getting ready to complete its IPO in Hong Kong in the coming weeks. Mixue Group plans to raise about US$500 million from its Hong Kong IPO.
- The company has an excellent income statement with notable growth in sales and profits in the past four years.
- Net margin improved from 15.7% in 2023 and 18.7% in 1Q-3Q 2024, driven by higher sales base and lower major operating costs as a percentage of sales
[Baidu, Inc. (BIDU US, SELL, TP US$78) Preview]: Baidu’s Problem Is Deep Rooted and Getting Worse
- We expect BIDU to post C4Q24 top line,non-GAAP operating profit and GAAP net income (5.1%), (7.7%) and (8.7%) vs. consensus.We expect BIDU to issue C1Q25 top line guidance (1.2%) vs.consensus;
- BIDU’s problem is not only manifested in the loss of the Apple contract,it is also the loss of first mover advantage in both Generative Artificial Intelligence and Autonomous Driving Services.
- Losing traffic advantage, BIDU has become a self-containing app ecosystem but all pillars of this ecosystem is facing intensifying competition. SELL @US$78.
Tam Jai Intl (2217 HK): It Seems like Quite Some People Are Unhappy
- Tam Jai International (2217 HK)‘s privatisation price is lower than we expected, based on 1.37x 12-month forward P/B, against our expectation of 1.63x (the historical average).
- The PER of 21.1x for CY25, a premiuim to sector average of 13.7x, however, looks attractive enough for investors that entered in the last 12 months.
- The 52.6% discount to IPO price (HK$3.33) and huge net cash have made some early investors unhappy. There is already letter from a minority shareholder calling to vote against it.
Alibaba (9988 HK): How Options Traders Are Navigating the Rally and Volatility. Top Trades.
- This Insight analyses Alibaba Group Holding (9988 HK) tailor-made option strategies traded over the last five trading days on the Hong Kong Exchange. Strategy highlights and volatility context are provided.
- These traders tailor structures to risk budgets and take calculated bets. Several large box trades appeared on the ticker.
- Expect more movement on Alibaba Group Holding (9988 HK)‘s Q3 earnings announcement tomorrow, 20 February 2025. Option-implied move at the end of this Insight.
Mixue IPO: More than Just Tea. Key Facts, Financials and Analysis
- Mixue Group, the largest freshly-made drinks company in China, is reportedly set to begin book building for its Hong Kong IPO by end-February, targeting to raise approximately USD 500 million.
- Mixue Group (MIX HK)‘s mass-market pricing strategy and compelling value for money positioning targets price-sensitive consumers, especially in lower-tier cities and among youth, driving high-volume sales.
- Mixue Group (MIX HK) reported robust revenue and profit growth for first nine months of 2024 led by new store openings and margin expansion despite sector slowdown and intensifying competition.
Quiddity Leaderboard ChiNext & ChiNext 50 Jun25: ~US$1.3bn One-Way; Some Changes to Expectations
- The ChiNext index represents the performance of the 100 largest and most liquid A-share stocks listed on the ChiNext Market of the Shenzhen Stock Exchange.
- The ChiNext 50 index is a subset of the ChiNext Index and it consists of the top 50 names in the ChiNext index with the highest daily average turnover.
- We see 10 changes for the ChiNext index and 5 changes for the ChiNext 50 index in the next index rebal event. Collectively, there could be US$1.3bn one-way flows.
Midea IPO Re-Evaluation
- Midea is a sound equity investment which is a market leader in the electronics products with just 12.8 trailing PE.
- China newly launched consumer trade-in policy could become the new driver of Midea’s revenue stream.
- Overseas business expansion could become the new game changer to re-rate the company’s valuation in the longer term.
Asia Real Estate Tracker (18-Feb-2025): ADIA, Hines sell Shanghai Trophy Tower for $1.5B
- ADIA and Hines sell Shanghai Tower for $1.5B to insurer-backed fund, showcasing large-scale real estate transactions.
- Keppel DC REIT sells German data centre at 39% loss from 2019 purchase price, indicating potential challenges in the real estate market.
- TPG offers $65M for Econ Healthcare, Singapore nursing home operator, amidst growing interest in healthcare industry investments.
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