Overseas Chinese Equities, Aequitas Research

Ming Lu

A veteran with 19-year experience in equity research.

Geographical coverage:
* Companies operating in China, but listed in Hong Kong and the U.S.
* Previously China A-share (listed in mainland China).

Equity sector coverage:
* Chinese App / Internet-based consumption in China, e.g., Alibaba, Tencent, etc.
* Previously covered education, transportation, telecom, power, bank, advertisement, hotel, etc.

Research methods:
* Generally bottom-up.
* Talk to related people on the ground.  Talk to readers and independent writers for analyzing a news portal.  Talk to parents and teachers for analyzing a tutoring school. 
* Visit stores and show photos as evidence in notes.
* Do technical analysis when finding a short-seller attacking an equity.

Languages:
* English
* Mandarin Chinese (Official language of China)
* Shanghainese (Language of Shanghai, the most developed city in China)
* Cantonese (Language of Hong Kong and Canton Province, one of the most developed provinces in China)

Overseas Chinese Equities

TAL Education (TAL): Margin Reached 5-Year High, Too Late to Buy, Downgrade to Hold

TAL Education (TAL): First Loss Since IPO, But Overreacted, Upgrade to Buy

TAL Education (TAL): Has Won Summer Marketing for Last Opportunity on Internet

TAL Education (TAL US) - Chaos in Junior High School Application in Shanghai

TAL Education (TAL): Weak 2Q19 as Expected, But Do Not Short It

New Oriental (EDU): Educator License Not A Concern

EDU & TAL：August Quarter: A Big Gamble and a Small Gamble

Equity Bottom-Up

<ul class="">
<li>We believe that parents of primary school children will bring their children back to tutoring schools when they become aware of the competition in junior high schools.</li>
<li>The expansion of online business and the change towards small classes are improving both the revenue growth and the margins.</li>
<li>We believe that the requirement of educator license is not a concern.</li>
<li>The 5-year P/E band suggests an upside of 44% for the share of TAL Education.</li>
</ul>


We believe that parents of primary school children will bring their children back to tutoring schools when they become aware of the competition in junior high schools.
The expansion of online business and the change towards small classes are improving both the revenue growth and the margins.
We believe that the requirement of educator license is not a concern.
The 5-year P/E band suggests an upside of 44% for the share of TAL Education.


TAL Education (TAL): Online Courses Improved Margin in 3Q19, Parents Returning, 44% Upside