In today’s briefing:
- KWEB Index Rebalance: HealthyWay In; East Buy Out
- China Healthcare Weekly (Jun.1)-Akeso/Summit’s Disappointing Ph3 Readout,Valuation Outlook of Biokin
- Haw Par (HPAR SP) —2025 Update
- IHH Healthcare (IHH MK): Sustained Demand, Higher ARPOB Drive 1Q; Expansion Key for Future Growth
- Pre-IPO Softcare – Strong Performance Growth Momentum Would Continue
KWEB Index Rebalance: HealthyWay In; East Buy Out
- The June rebalance of the KraneShares CSI China Internet ETF (KWEB US) will take place at the close of trading on 13 June.
- HealthyWay (2587 HK) will be added to the ETF while East Buy Holding (1797 HK) will be deleted. The passive trading will offer an opportunity to exit positions.
- There is a huge lock-up expiry in HealthyWay (2587 HK) on 30 June and the stock could drop ahead of that. Then it could drop some more after lock-up expiry.
China Healthcare Weekly (Jun.1)-Akeso/Summit’s Disappointing Ph3 Readout,Valuation Outlook of Biokin
- CR Sanjiu plans to transfer 49.8967% equity of Sanjiu (Anguo) and pay more attention to the quality of external M&As. China Resources+Tasly+KPC will be the core drivers of future performance.
- Akeso’s first global phase 3 readout for ivonescimab was disappointing, which cast shadow on the final FDA approval. We shared our views on the outlook and valuation ahead.
- The failure of HER3-DXd cast shadow over the outlook of HER3. We think Biokin is overvalued. Its valuation should be lower than Akeso and Kelun Bio.
Haw Par (HPAR SP) —2025 Update
Haw Par Corporation is a conglomerate owned by Singapore’s Wee family. It’s most famous for selling Tiger Balm — an ointment used for quick pain relief. But it also owns large stakes in commercial bank UOB and property developer UOL.
The business has continued to recover from COVID-19, when pharmacies had to close and tourism ground to a halt. Tiger Balm revenues are now back to their pre-COVID levels.
I get to an intrinsic value of SG$17.0 per share — well above the current share price of SG$11.8. And that’s assuming a 25% conglomerate discount.
IHH Healthcare (IHH MK): Sustained Demand, Higher ARPOB Drive 1Q; Expansion Key for Future Growth
- IHH Healthcare (IHH MK) delivered 1QFY25 revenue of RM 6.3B, up 6%, driven by sustained demand, favorable patient mix of more acute patient, and higher revenue per in-patient.
- Hospital and Healthcare’s Q1FY25 EBITDA remained flat as higher revenues were offset by higher staff cost and start-up cost of newly opened Acibadem Kartal Hospital.
- Turkiye & Europe and Malaysia show strength. Margins remains under pressure in major markets.
Pre-IPO Softcare – Strong Performance Growth Momentum Would Continue
- Softcare has established its core competitiveness of “low price + localization”, and has achieved success in Africa. Softcare hopes to replicate its business model in Africa to other markets.
- Emerging Markets have seen sustained growth in market penetration of baby/feminine hygiene products. We’re optimistic about Softcare’s future performance growth due to “demographic dividend + consumption upgrade” in Emerging Markets.
- Softcare has strong fundamentals and promising outlook. We think valuation of Softcare should be higher than Hengan International Group (1044 HK) due to higher profit margin and future growth potential.
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