China Archives | Page 9 of 199 | Smartkarma

• New World announced FY25 results, market reaction was initially negative, due to losses to shareholders.  Stock was down 10% post open but rebounded quickly to recover all the losses
• However, we think the market has neglected the other positives: strong contract sales, resilient IP earnings, improved total debt, stabilized gearing and lower borrow cost
• Market is forward-looking, we think NWD, as a leveraged play, will benefit the most in rate cut cycle.  At current valuation (0.12x PB) – we continue to stay bullish

• Despite its 96% price appreciation since our initiation, United Laboratories is still trading on a 8.7 FPE, and a 5.5 EV/EVITDA.
• A US FDA GLP-1 approval and a potential $ 1.8bn deal with Novo Nordisk demonstrates its successful diabetes and obesity strategy.
• With over 80 drugs in the pipeline to be delivered over the next five years, we believe that TUL is about to experience a very material increase in topline growth.

• Cosin Solar Technology Co (SUPCOZ CH) is looking to raise about US$100m in its upcoming Hong Kong IPO. The deal will be run by China Securities International.
• Cosin Solar Technology Co. (CST) is a Chinese company specializing in concentrated solar power (CSP) solutions, particularly molten salt tower systems. 
• The company’s main business lies in providing the collector system and other core sub-systems essential for constructing large-scale CSP plants.

• Innovent Biologics is a rapidly growing Chinese biopharmaceutical firm transitioning towards profitability, driven by a strong portfolio of commercialized drugs, notably the PD-1 inhibitor TYVYT® (sintilimab).
• The company possesses a deep and diversified pipeline spanning oncology, metabolic diseases, autoimmune disorders, and ophthalmology, positioning it for sustained long-term growth beyond its current core products.
• While exhibiting impressive revenue growth and improving financials, the company faces significant risks from intense domestic competition, government-led drug price negotiations (NRDL), and a high valuation that may already price in future success.

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• Sunny Optical is a global leader in optical components, holding substantial market shares in key segments like vehicle and handset lens sets, positioning it to capitalize on long-term growth in automotive autonomy and smartphone premiumization.
• The company exhibits a strong financial profile, characterized by a healthy net cash position, which provides resilience and flexibility. However, it has faced significant headwinds recently, with key financial metrics showing negative growth over the last three years.
• Key risks include high customer concentration with major tech companies, intense industry competition, and the rapid pace of technological change, which creates uncertainty and could impact future profitability.

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• Accelink is a leading Chinese optical components manufacturer, well-positioned to capitalize on secular growth trends in data centers, 5G, and AI-driven network upgrades. Strong revenue growth and market momentum are key positives.
• Significant concern arises from the company’s consistently negative cash flow generation. Despite a strong top-line growth track record, operating and free cash flow have deteriorated significantly over the last several years, indicating potential issues with working capital management or profitability of its growth.
• The company trades at a premium valuation compared to the provided peer average, with a P/E ratio over 60x. This elevated valuation, combined with margin pressure and severe cash flow issues, suggests the market may be pricing in a level of growth and profitability that could be challenging to achieve.

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• FS adopts a unique light-asset business model of “R&D design + outsourcing production + direct sales platform”, which leads to higher profit margin than traditional channel sales vendors.
• FS once failed in A-Share IPO and received penalty in 2025. Internal control defects are the “Achilles heel”, which makes us worry whether FS has the problem of “inflating revenue”. 
• Although FS has positive performance growth, the uncertainty of Sino-US relations and exchange rate risks may put pressure on profitability. Valuation of FS could be lower than peers. 

• Innovent Biologics Inc (1801 HK) has announced 1H25 result, with total revenue increasing 51% YoY. The company recorded its maiden net profit of RMB834M on a reported basis.
• Despite an overcrowded PD-1 inhibitor market in China, core oncology product, Tyvyt maintained good growth momentum. Tyvyt is under NDA review for its ninth and tenth indications.
• In June, Innovent received approval for mazdutide, first-in-class chronic weight management drug in China. In 2H25, mazdutide is expected to receive approval for a second indication in type 2 diabetes.

• Lee’s Pharmaceutical is an integrated biopharmaceutical company focused on the Chinese market, with a dual strategy of developing proprietary drugs and licensing international products.
• The company demonstrated a significant financial turnaround in the most recent fiscal year, with substantial growth in revenue and net income, reversing a trend of long-term decline.
• Despite a recent recovery, the company faces high uncertainty due to a history of volatile earnings and significant long-term declines in key metrics like net income and market capitalization, balanced against a currently attractive valuation.

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• In today’s Morning Views publication we comment on developments of the following high yield issuers: Yuexiu REIT, Vedanta Resources, Nickel Industries
• The UST curve twisted slightly steeper yesterday, with the front-end continuing to be supported by the prospect of Fed rate cuts against the backdrop of a looming US government shutdown.
• The yield on the 2Y UST fell 1 bp to 3.61%, while that on the 10Y UST was up 1 bp at 4.15%. Equities climbed for the third day, with the S&P 500 and Nasdaq up 0.4% and 0.3%, respectively.

• Impact Therapeutics, a China-based near-commercial-stage biopharma company, is looking to raise at least USD 100 million via a Hong Kong listing. GS and CICC are the joint sponsors
• In this note, we look at the company’s core products, senaparib/IMP4297, and key products IMP1734 and IMP9064.
• We also look at the company’s pre-IPO investors and management team.

• Videotimes adopts a “domestic production + overseas sales” model. The Company competes for market share by relying largely on Amazon channel and price cuts, with overall revenue showing upward trend.
• Due to Sino-US tariff war and the risk of US dollar depreciation, future performance decline seems inevitable. Our forecast for 2025 is revenue/net profit could be down 4.8% YoY/21% YoY.
• Valuation of Videotimes could be lower than peer. A comfortable range is P/E of 10-15x. However, if 2025 performance decline is confirmed, valuation may be revised down to 6-10x P/E.

• Melco International Development (200 HK) is now trading at a premium to NAV for the first time since announcing a one-for-two rights issue.
• Preceding my comments on Melco are the current setup/unwind tables for Asia-Pacific Holdcos.
• These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation >20%.

• Zijin Mining Group is a leading global mining company with a significant presence in gold, copper, and zinc production. The company is strategically focused on expanding its international footprint through acquisitions and organic growth, particularly in gold and copper.
• The company is capitalizing on high commodity prices, especially for gold, to fuel its growth and is undertaking a significant corporate action by spinning off its international gold assets into a separately listed entity, Zijin Gold, in Hong Kong to attract global investors.
• While demonstrating strong financial performance and production growth, the company faces challenges related to geopolitical risks, resource nationalism, and the inherent volatility of commodity markets. A key focus for the future is balancing its aggressive expansion with sustainable and responsible mining practices.

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• US as the world’s largest service economy means artificial general intelligence (AGI) saves cost by replacing knowledge workers. 
• China’s AI monetization is today 1/3 of US but will improve to 1/2 by 2030. 
• We reiterate our TOP PICKS of Alibaba, HESAI, CATL and Kuaishou. BIDU stays as SELL.

• Minmetals Land (230 HK) entered a trading halt “pending the release of an announcement in relation to certain inside information and pursuant to the Hong Kong Code on Takeovers and Mergers.“
• It is likely that the controlling shareholder (China Minmetals), representing 61.88% of outstanding shares, is seeking to launch a privatisation through a Bermuda scheme. 
• With a 40% surge in its share price on Monday, Minmetals is trading at a significant premium to book, suggesting limited upside. I estimate a potential offer range of HK$0.54-HK$0.69.

• Taste Gourmet is a fast-growing, multi-brand restaurant operator in Hong Kong, demonstrating a remarkable growth trajectory with a 3-year net income CAGR of 53.6%.
• The company is an attractive income play, offering a high dividend yield of approximately 8.6%, supported by robust free cash flow generation.
• Valuation appears compelling at a significant discount to peers, with a potential rerating catalyst from its proposed migration from the GEM to the Main Board of the Hong Kong Stock Exchange.

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• For Sep 2025, nine new transactions (firm and non-binding) were discussed on Smartkarma (by the Quiddity team) with an overall announced deal size of only ~US$3bn.
• The average premium for the new transactions announced (or first discussed) in September was ~56%, with a year-to-date average of ~48%.
• The average premiums for transactions in 2024 (129 transactions), 2023 (117), 2022 (106), 2021 (165), 2020 (158), and 2019 (145 ) were 43%, 39%, 41%, 33%, 31%, and 31%.

• Melco International Development is a holding company whose primary asset is its majority stake in Melco Resorts & Entertainment (MLCO), a leading operator of integrated casino resorts with a strong presence in Macau and expanding operations in the Philippines and Cyprus.
• The company is experiencing a significant financial turnaround, with revenues and cash flows rebounding strongly from pandemic-era lows. This recovery is driven by the resurgence of tourism and gaming demand in Macau, particularly in the high-margin premium mass market segment.
• Despite strong operational performance and growth, valuation appears stretched. The parent company (200 HK) trades at a premium to its Net Asset Value (NAV), a reversal of its historical discount, suggesting the market may have already priced in the near-term recovery.

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• Pateo Connect is a prominent provider of smart cockpit solutions in China’s rapidly growing New Energy Vehicle (NEV) market, demonstrating robust revenue growth driven by the adoption of high-end products.
• The company faces substantial profitability hurdles, characterized by persistent net losses and gross margins that are the lowest among its peers, signaling a challenging competitive position.
• The investment profile is high-risk, marked by a concentrated customer base, increased financial leverage, and a premium valuation for its upcoming IPO that appears stretched relative to its growth and margin outlook.

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• Asian USD high-yield bonds have outperformed on an improving sentiment toward emerging market credits.
• China 5-year CDS has declined 14 bps since June and we expect non-property Chinese credits to have more capital inflow on  the hunt for a better yield.
• We are in favor of Chinese high-yield credits with recurring revenue and operate in more defensive industries such as consumer non-discretionary, utilities, and pharmaceuticals.

• The essence of KEYING’s business model is a “middle man” and relies on making money through price difference in the process of sales of goods, but “de-intermediation” is a trend.
• The pain point is most retail solution providers are unlikely to become industry giants due to excessive investment/lack the say in core technologies/products.The underlying logic of the industry is changing.
• As the platform traffic dividend disappears and the trend of brand self-built teams intensifies, KEYING’s bargaining power is weakening.Valuation should be lower than peers due to weaker performance growth rate/profitability.  

• Melco International Development (200 HK) is now trading at a premium to NAV for the first time since announcing a one-for-two rights issue.
• Preceding my comments on Melco are the current setup/unwind tables for Asia-Pacific Holdcos.
• These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation >20%.

• Zijin Mining Group is a leading global mining company with a significant presence in gold, copper, and zinc production. The company is strategically focused on expanding its international footprint through acquisitions and organic growth, particularly in gold and copper.
• The company is capitalizing on high commodity prices, especially for gold, to fuel its growth and is undertaking a significant corporate action by spinning off its international gold assets into a separately listed entity, Zijin Gold, in Hong Kong to attract global investors.
• While demonstrating strong financial performance and production growth, the company faces challenges related to geopolitical risks, resource nationalism, and the inherent volatility of commodity markets. A key focus for the future is balancing its aggressive expansion with sustainable and responsible mining practices.

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• US as the world’s largest service economy means artificial general intelligence (AGI) saves cost by replacing knowledge workers. 
• China’s AI monetization is today 1/3 of US but will improve to 1/2 by 2030. 
• We reiterate our TOP PICKS of Alibaba, HESAI, CATL and Kuaishou. BIDU stays as SELL.

• Minmetals Land (230 HK) entered a trading halt “pending the release of an announcement in relation to certain inside information and pursuant to the Hong Kong Code on Takeovers and Mergers.“
• It is likely that the controlling shareholder (China Minmetals), representing 61.88% of outstanding shares, is seeking to launch a privatisation through a Bermuda scheme. 
• With a 40% surge in its share price on Monday, Minmetals is trading at a significant premium to book, suggesting limited upside. I estimate a potential offer range of HK$0.54-HK$0.69.

• Taste Gourmet is a fast-growing, multi-brand restaurant operator in Hong Kong, demonstrating a remarkable growth trajectory with a 3-year net income CAGR of 53.6%.
• The company is an attractive income play, offering a high dividend yield of approximately 8.6%, supported by robust free cash flow generation.
• Valuation appears compelling at a significant discount to peers, with a potential rerating catalyst from its proposed migration from the GEM to the Main Board of the Hong Kong Stock Exchange.

This content is AI-generated and displayed for general informational purposes only. Please verify independently before use.

• For Sep 2025, nine new transactions (firm and non-binding) were discussed on Smartkarma (by the Quiddity team) with an overall announced deal size of only ~US$3bn.
• The average premium for the new transactions announced (or first discussed) in September was ~56%, with a year-to-date average of ~48%.
• The average premiums for transactions in 2024 (129 transactions), 2023 (117), 2022 (106), 2021 (165), 2020 (158), and 2019 (145 ) were 43%, 39%, 41%, 33%, 31%, and 31%.

• Melco International Development is a holding company whose primary asset is its majority stake in Melco Resorts & Entertainment (MLCO), a leading operator of integrated casino resorts with a strong presence in Macau and expanding operations in the Philippines and Cyprus.
• The company is experiencing a significant financial turnaround, with revenues and cash flows rebounding strongly from pandemic-era lows. This recovery is driven by the resurgence of tourism and gaming demand in Macau, particularly in the high-margin premium mass market segment.
• Despite strong operational performance and growth, valuation appears stretched. The parent company (200 HK) trades at a premium to its Net Asset Value (NAV), a reversal of its historical discount, suggesting the market may have already priced in the near-term recovery.

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• Pateo Connect is a prominent provider of smart cockpit solutions in China’s rapidly growing New Energy Vehicle (NEV) market, demonstrating robust revenue growth driven by the adoption of high-end products.
• The company faces substantial profitability hurdles, characterized by persistent net losses and gross margins that are the lowest among its peers, signaling a challenging competitive position.
• The investment profile is high-risk, marked by a concentrated customer base, increased financial leverage, and a premium valuation for its upcoming IPO that appears stretched relative to its growth and margin outlook.

This content is AI-generated and displayed for general informational purposes only. Please verify independently before use.

• Asian USD high-yield bonds have outperformed on an improving sentiment toward emerging market credits.
• China 5-year CDS has declined 14 bps since June and we expect non-property Chinese credits to have more capital inflow on  the hunt for a better yield.
• We are in favor of Chinese high-yield credits with recurring revenue and operate in more defensive industries such as consumer non-discretionary, utilities, and pharmaceuticals.

• The essence of KEYING’s business model is a “middle man” and relies on making money through price difference in the process of sales of goods, but “de-intermediation” is a trend.
• The pain point is most retail solution providers are unlikely to become industry giants due to excessive investment/lack the say in core technologies/products.The underlying logic of the industry is changing.
• As the platform traffic dividend disappears and the trend of brand self-built teams intensifies, KEYING’s bargaining power is weakening.Valuation should be lower than peers due to weaker performance growth rate/profitability.  

• Zijin Gold (2259 HK) priced its IPO at HK$71.59 per share to raise gross proceeds of approximately US$3.2 billion. The shares will begin trading on September 30.
• The IPO was discussed in Zijin Gold IPO: The Investment Case and Zijin Gold IPO (2259 HK): Valuation Insights.
• The market sentiment of the peers has increased since the IPO launch. My analysis suggests that the IPO price range is attractive.

• In MINISO (9896 HK)’s (Possible) TOP TOY Spin-Off Is Priced In, based on (then) available figures and applying a holding company discount, post spin-off, MINISO’s upside appeared limited.
• A listing application form has now been submitted to the HKEx, providing greater detail of TOP TOY’s finances, figures vastly different to those in MINISO’s recent segment accounts. 
• The Labubu craze has resulted in a ~200% increase in Pop Mart (9992 HK)’s shares YTD. TOP TOY will be wanting to cash in on this exuberance. 

• Based on DCF model, valuation is about US$28.4 billion. We think this is the valuation bottom line. Conservative investors can take profits at this valuation level.
• Valuation has the potential to reach US$34-42bn (or 18-22x P/E ) if based on 2025 forecast.Optimistic investors can choose to wait for stock price to fall within this valuation range. 
• Considering better profitability/shareholder resources, Zijin Gold has more advantage than Shandong Gold Mining. Therefore, market value of Zijin Gold will widen the gap with Shandong Gold Mining in the future.

• Riding on strong investor demand, Zijin Gold (2259 HK)  has exercised its over-allotment option, boosting the total IPO size to USD 3.7 billion from USD 3.2 billion previously.
• As Hong Kong’s only pure-play gold miner with global exposure, Zijin Gold may command a premium, though any sharp price gains still depend on sustained gold price strength.
• Investors should define their medium- to-long-term gold price thresholds to shape a clear post-IPO strategy for Zijin Gold.

• Zijin Gold (2259 HK) raised around US$3.2bn in its Hong Kong IPO.
• It is a global leading gold mining company formed by combining all of the gold mines of Zijin Mining, located outside of China.
• We have covered various aspects of the deal in our previous note. In this note, we will talk about the demand and trading dynamics.

Key points (machine generated)

• Didi’s stock price is stable at $4.90, adhering to management guidance for eight months.
• Concerns about autonomous driving in China arise due to low labor costs and a deflationary environment, impacting regulatory responses.
• Didi is well-positioned for partnerships with AV companies, while Tesla faces regulatory challenges in operating a ride-hailing service in China.

This article is sourced from an online content aggregator through publicly available sources and is displayed below for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

• Nova Insight (INS HK) is looking to raise at least US$100m in its upcoming Hong Kong IPO. The deal will be run by JP Morgan and HSBC.
• Nova Insight is the largest independent AI technology company in the insurance industry in China.
• As of Dec 31, 2024, Nova’s solutions have been cumulatively adopted by 90 insurance companies, including eight of the top ten insurance companies in China.

• Evergrande is a defunct Chinese property developer that was once the second-largest in China by sales. Its collapse in 2021 triggered a major crisis in the country’s real estate sector.
• The company is currently undergoing liquidation after a Hong Kong court order in January 2024, following its failure to present a viable restructuring plan for its massive debt, which exceeded $300 billion.
• The future for Evergrande‘s stakeholders is highly uncertain, with offshore creditors facing a bleak outlook for recovery. The company’s situation highlights significant corporate governance failures and systemic risks within China’s property market.

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• Netdragon is a prominent player in China’s online gaming and mobile internet sectors, with a growing international presence in the education technology market.
• The company is strategically pivoting towards the integration of Artificial Intelligence (AI) in both its gaming and education segments, aiming to enhance user experience and operational efficiency.
• Despite recent revenue declines and market volatility, Netdragon maintains a strong dividend yield and has an active share buyback program, signaling management’s confidence in its long-term strategy.

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Founded in 1984, Sunny Optical Technology is a leading global integrated optical-component manufacturer. It was the largest global vehicle lens-set producer in 2024 with a market share of 32.3%, the largest global handset lens-set producer (30.8% market share) and the largest global handset camera-module producer (12.1%). The company has been listed on the Hong Kong Stock Exchange since 2007. The largest shareholder is Sun Xu Limited with a 35% stake, while 65% is publicly held. Founder Wang Wenjian and the Sunny Group Employee Offshore Trust own and control Sun Xu Limited.

• Gross SOUTHBOUND volumes just over US$19bn a day this past 5-day week. Big. Quite decent net buying flows too though the market fell. 
• The recommended name last week was short Alibaba (9988 HK) was +4.65% on the week despite HK being down across the board.
• The data tables below update on a daily basis in the Tools section of Smartkarma. The SOUTHBOUND Flow Monitor and AH Pairs Monitor are both there for all SK readers.

• Netdragon Websoft (777 HK) stock has begun to rerate on the back of its deal with with Zhongke Wenge to integrate and launch AI applications outside of China.
• NetDragon will integrate Wenge’s LLM, YaYi, with its education products.  In August 2025, Cherrypicks and Wenge jointly launched AI applications, including social listening and multimodal content creation tools globally.
• NetDragon has consistently enhanced shareholder returns through substantial dividends and since its earnings announcement in August has begun buying back shares in the market.

• “Beautiful Skew” showed up slightly as Hs underperformed their As across the board (every sector, every premium tranche), but more on narrow AH Premia. 
• Last week’s short reco on China Merchants Bank H (3968 HK) saw the H-share underperform its A by 2.54% and it outright fell 3.14%. OK week. 
• The data tables below update on a daily basis in the Tools section of Smartkarma. The SOUTHBOUND Flow Monitor and AH Pairs Monitor are both there – free – for all SK readers.

• Context: Volatility cones provide a straightforward framework to evaluate whether options are trading cheap or rich. This Insight provides volatility analysis for eight prominent Hong Kong stocks
• Highlights: Ping An Insurance (H) (2318 HK)stands out with historically low implied volatility across the term structure. Alibaba (9988 HK)is rich in November and December contracts.
• Why Read: Spot opportunities, assess regime shifts, and manage risk effectively — volatility cones turn complex data into actionable insights for traders and investors.

• Aequitas Research’s weekly update on the IPOs, placements, lockup expiry and other ECM linked events that were covered by the team over the past week.
• On the IPO front, this week saw a few good listings across the region while the spotlight will be on Zijin Gold (2259 HK) in the coming week.
• On the placements front, it was a relatively quiter week, as compared to some of the more recent weekly flows.

• Netdragon is a prominent player in China’s online gaming and mobile internet sectors, with a growing international presence in the education technology market.
• The company is strategically pivoting towards the integration of Artificial Intelligence (AI) in both its gaming and education segments, aiming to enhance user experience and operational efficiency.
• Despite recent revenue declines and market volatility, Netdragon maintains a strong dividend yield and has an active share buyback program, signaling management’s confidence in its long-term strategy.

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• CF017 is CF PharmTech’s core performance driver. Once CF017 faces policy adjustments or intensified market competition, revenue will be significantly impacted. Its ability to sustain operations will be severely tested.
• Although CF PharmTech has made a profit, problems such as a slowdown in revenue growth and heavy reliance on single product will lead to a valuation discount by the market.
• A reasonable valuation range might be between RMB3-5 billion. If valuation exceeds RMB5 billion, it would seem overly optimistic and require strong support from subsequent performance and solid fundamentals.

• The delivery system is a crucial element that drives the development/iteration of innovative oligonucleotide therapeutics. Ribo has mastered both GalNAc and LNP technologies, whose effectiveness/safety have been verified and recognized.
• The valuation fluctuations not only reflect the market’s prudence towards commercialization prospects of small nucleic acid drugs, but also highlight the balance problem between Ribo’s R&D investment and profit model.
• Since Sirnaomics’ delivery technologies have not been proven or validated scientifically, Ribo’s valuation should be higher than Sirnaomics.Valuation outlook is based on the druggability and commercialization performance of Ribo’s pipelines. 

• Roborock’s margins are expected to bottom-out after a tough four quarters of strategically prioritizing market share at the cost of margins. 3Q-4Q25 will mark the start of new margin cycle.
• Margins stabilizing at the new normal of 12-14% NPM will mean earnings will track revenue growth going forward. Meanwhile, revenues can surprise on the upside with >25% CAGR in medium-term.
• HK-Listing into 2H25/ 1H26 is a strong catalyst which can bring in fresh money, and improve disclosure standards – a key concern. We expect 70% upside in our bull case.

• A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
• ECM developments: Zijin Gold (2259 HK), Tekscend Photomask (429A JP) and Tata Capital Limited (TATACAP IN) IPOs.
• Event-Driven developments: Mandom Corp (4917 JP), Pacific Industrial (7250 JP), Paramount Bed Holdings Co Lt (7817 JP), Soft99 Corp (4464 JP), Changhong Jiahua Holdings (3991 HK). 

• We remain near-term bullish since our 4/22/25 Compass, and our intermediate-term outlook remains bullish as well (as of our 5/14/25 Compass), with Int’l Compass reports all echoing this sentiment.
• Market dynamics remain overwhelmingly risk-on; with plenty of global liquidity, we expect upside to continue into year-end and the early part of 2026.
• Remain Overweight Taiwan, China, Korea, U.S., and Greece. Many buys in these countries, and also Europe and Japan. EURO STOXX 50 on the cusp of major breakout above 5500

• Trump said he will place import taxes on 100% of pharmaceutical drugs, which will begin on Oct.1. Below, we shared our views on this new policy.
• Some companies continue to repurchase/increase their holdings despite the industry’s significant rise this year, indicating that major shareholders truly have confidence in the outlook. We specifically listed these companies.
• The fluctuations in Duality’s stock price are obviously driven by capital after being included in HK Stock Connect. we suggest that investors pay attention to risks as Duality faces correction.

• Zijin Gold IPO will start trading on 30 September. Zijin Gold is aiming to raise US$3.2 billion (HK$24.98 billion) from its IPO, offering 349 million shares at HK$71.59 each.
• Our base case valuation of Zijin Gold is HK$124.7 per share (74.2% higher than the IPO price). We expect a sharply higher pop on the first day of trading.
• If its share price appreciates more than 30-50% or more, we think it is prudent to take some profits off the table (at least 25%-30% of total investment). 

• Pacific Textiles is a major knitted fabric manufacturer facing significant headwinds, evidenced by a multi-year decline in revenue and profitability. The company’s performance is closely tied to the cyclical nature of the global apparel market and the inventory management of its key customers.
• The company maintains a high dividend yield, which may appeal to income-focused investors. However, the sustainability of this payout is questionable given the sharp decline in net income and free cash flow, and the dividend per share has already been reduced.
• Strategically, the company is shifting production capacity to its Vietnam facilities to capitalize on lower costs and changing trade dynamics. This move is crucial for future competitiveness but also entails execution risk and underutilization of its China-based assets.

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• Zijin Mining is a rapidly growing global mining powerhouse, having recently become the world’s third-largest mining company by market capitalization, driven by surging gold and copper prices.
• The company exhibits a strong growth trajectory, underpinned by a successful strategy of aggressive international acquisitions and superior operational capabilities that enable faster mine development.
• Despite robust financial performance and a positive commodity outlook, the company’s valuation appears stretched, with high short interest suggesting significant market skepticism.

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• As suggested in our previous insight, the Hang Seng Index (HSI INDEX) rally was at risk of pulling back: a small correction began last week.
• The big question now: is this just a minor 1-week pullback (a buy-the-dip opportunity)? or a larger pullback, possibly directed towards 23k?
• This insight discusses the various tactical scenarios, including profit targets for a continuation of the rally from here.

• Horizon Robotics (9660 HK) raised around US$800m in its Oct’24 IPO and another US$600m via a placement in June’25. It’s back again to raise another US$834m via a top-up placement.
• Horizon Robotics (HR) is a provider of advanced driver assistance systems (ADAS) and autonomous driving (AD) solutions for passenger vehicles, empowered by its proprietary software and hardware technologies.
• In this note we talk about the deal dynamics and run the deal through our ECM framework.

• In What’s Up (& Up) With Shandong Hi-Speed (412 HK)?, I thought Shandong Hi-Speed Holdings (412 HK) was a bubble after gaining 190% in the past six months. 
• My guess was that SDHG’s high shareholder concentration was still very much present, and the stock was getting (unjustly) squeezed.
• The SFC concurred on the 18th September, and issued a concentration warning. SDHG’s shares cratered 76% on the 19th September, before recovering 49%. Quite the ride. 

• Otsuka Holdings (4578 JP) aims to raise around US$150m via selling its remaining shares in Microport Scientific (853 HK).
• Otsuka had sold the majority of its stake earlier this year.
• In this note, we will talk about the placement and run the deal through our ECM framework.

• With the pre-cons squared away as per the 3rd September announcement, the key risk to Hangzhou Kangji Medical Instrument (9997 HK)‘s Offer is the Scheme vote. 
• The HK$9.25/share consideration price (declared final), was an uninspiring 9.9% premium to last close. But pitched around a four-year high. And peers are down 10% on average since the Offer.
• A persual of the s329 investigative reports provides a significantly clearer picture on who holds what.

• On the 28th April 2025, PRC-incorporated property management play Jinke Smart Services (9666 HK) announced a possible unconditional MGO take-under at HK$6.67/share.
• At an auction, the Boyu-backed Offeror and Concert Parties, (then) holding 37.86%, bought a 18.05% stake in Jinke, subject to CSDC oversight. Approval was received on the 19th September.
• The Composite Document is now out, and shareholders, should they so choose, can tender. The first close is the 17th October. The Offer may get extended.  I doubt it. 

• Copper & Gold Torque: Zijin has crossed US$100bn market cap as copper tops US$10,300/t and gold nears US$3,770/oz, with shares up ~60% in 3M and ~83% in 12M.
• Spin-Off Catalyst: Zijin Gold International IPO raised US$3.2bn at HK$71.6/sh; on our quality-weighted view, fair value is ~US$38.5bn EV vs ~US$24bn at IPO.
• Valuation Upside: 2027E SOTP points to HK$34.8/sh base (+12%), HK$38–39/sh spot (+25%), and HK$39–41/sh bull (+30%); detailed Zijin Gold valuation in our companion report.

• Alibaba Group has announced an aggressive expansion of its artificial intelligence ambitions, earmarking over $50 billion in new AI and cloud investments over the next three years—an amount greater than its entire spending over the last decade.
• This significant push is aimed at positioning the company at the forefront of Asia’s generative AI and cloud infrastructure race.
• Central to this effort is the launch of its next-generation large language model, Qwen3-Max, following the success of Qwen2.5, which already has over 90,000 derivative models globally.

• China announced game approval for the September batch. The number of games approved remained at a higher level than 2023.
• The pace of China game approval appears to have accelerated to the same level as pre-tightening.
• Both Tencent and Netease received approval for one game in September. 

• NIO is a prominent player in China’s premium electric vehicle (EV) market, distinguished by its strong brand, innovative Battery-as-a-Service (BaaS) model, and focus on user community.
• The company faces significant headwinds, including intense competition in the Chinese EV market, persistent unprofitability, and high cash burn, necessitating reliance on capital markets for funding, as evidenced by a recent US$1 billion equity offering.
• Future success hinges on management’s ability to execute on ambitious targets, such as improving gross margins with new models and achieving profitability, a goal they have missed in the past.

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• Citi warns iron ore’s rally is overstretched, with policy support and supply disruptions priced in, leaving limited upside ahead.
• Managed Money participants are ramping up net long exposure, underscoring renewed bullish sentiment and rising confidence in stronger demand and price gains.
• Iron ore’s momentum is fading as Bollinger Bands and MACD flash bearish signals, with sellers gaining control and downside risks rising.

• Alibaba (9988 HK) launched Qwen3-Max, its largest LLM to date, along with a suite of Qwen3 models and technical upgrades at its annual flagship conference, reinforcing its full-stack AI ambitions.
• The stock has surged nearly 50% month-to-date, fueled by investor optimism over AI-related upside, since the August 29 investor call.
• Investors now await proof that execution and performance will deliver on Alibaba’s bold technical claims and high market expectations.

• Chery Automobile (9973. HK) priced its IPO at HK$30.75 per share to raise gross proceeds of approximately US$1.2 billion. The shares will begin trading on September 25.
• The IPO was discussed in Chery Automobile IPO: The Bull Case, Chery Automobile IPO: The Bear Case and Chery Automobile IPO (9973 HK): Valuation Insights. 
• The market sentiment of the peers has declined since the IPO launch. Chery Auto is fairly valued at the IPO price.

• Baba’s recent surge mirrors past rallies, with recent sideways price action raising a caution flag.
• Metrics from the options market suggest that sentiment that was overheated has begun to turn.
• We explore an alternative hedge that will not cap a continued rally but is less expensive than directly buying Puts in Baba.

• Chery Auto, the second largest Chinese domestic brand passenger vehicle company, priced its IPO at the high end of the range at HK$30.75/share.
• High demand for the stock was predictable. Cornerstone investors collectively agreed to acquire ~$588M worth of Chery Auto shares in this offering.  
• The Chery Auto stock is set to start trading on Thursday. I see modest potential upside vs. IPO offer price as growth is slowing down and margins compressed.

• There are multiple signs of overheating in Baidu trading including accelerating stock and option volumes.  
• Skew has been driven higher by strong demand for up-strike Calls.
• We recommend a hedge that tilts the odds in the holder’s favor while establishing the position at a credit.

• Chery Automobile (9973 HK) raised around US$1.2bn in its Hong Kong IPO.
• Chery Auto is a Chinese passenger vehicle company which designs, develops, manufactures and sells passenger vehicles, including internal combustion engine vehicles and new energy vehicles, both domestically and overseas.
• We have looked at the company’s past performance in our previous notes. In this note, we talk about the trading dynamics.

• The macro-economic backdrop in China is challenging for banks, with soft economic growth driving worsening credit quality and dovish monetary policy pushing interest margins lower
• Nonetheless, China banks balance sheets appear to be relatively robust, and we screen ten large cap banks for contrarian buy opportunities
• We focus on two banks; Ping An Bank and CCB are our buy recommendations for their relatively strong returns and sound credit quality metrics

• Solarspace Technology (2221225D CH) is looking to raise about US$100m in its upcoming Hong Kong IPO. The deal will be run by China Securities International and CITIC Securities.
• Solarspace Technology Co., Ltd. is a global specialized photovoltaic (PV) cell manufacturer with an integrated presence in PV modules. which are the core components that convert sunlight into electricity.
• The company operates in the midstream of the solar value chain, focusing on the research, development, and large-scale production of both N-type and P-type PV cells, and PV modules.

• Allergy prevention and treatment products are core business. Although proportion of allergic children is increasing, it’s not enough to offset the decline in demand caused by the decrease in newborns.
• Due to fierce market competition and inadequate adult FSMP education, the non-infant FSMP market is not easy to operate. The acceleration of registration for FSMP will lead to fierce competition.
• Our 2025 forecast is revenue could be up 20% YoY, reaching RMB1 billion.Valuation of Sainte Nutritional should be higher than peers due to higher profit margin and performance growth rate.

• In today’s Morning Views publication we comment on developments of the following high yield issuers: Seazen Group, Cikarang Listrindo, Nickel Industries, China Vanke
• UST yields declined 2-5 bps across the curve yesterday, driven by solid demand for a 2Y notes auction even as Fed officials gave differing views over future rate cuts. The UST curve bull flattened, with the yield on the 2Y UST dropping 2 bps to 3.59% while that of the 10Y UST decreased 4 bps to 4.11%.
• Equities retreated from record-high levels after Fed Chairman Jerome Powell gave no indications of a rate cut in October during his policy speech. The S&P 500 fell 0.6% to 6,657, while the Nasdaq slumped 0.9% to 22,573.