HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Bottom-Up

Innovent Biologics Inc / Equity Bottom-Up

<ul>
<li>After COVID-19, China healthcare has been under pressure for a long time. High interest rate environment is unfriendly to companies, but the current situation is not entirely devoid of opportunities.</li>
<li>GLP-1s has reignited investors’ interest in this industry, which will be long-term opportunity and bring alpha. With rich domestic/overseas catalysts ahead, related share price performance is worth looking forward to.</li>
<li>Among the domestic GLP-1s companies, Innovent is our top pick. The "concept validation" of Innovent’s business model has been completed. A qualitative change in the Company is coming soon.  </li>
</ul>


After COVID-19, China healthcare has been under pressure for a long time. High interest rate environment is unfriendly to companies, but the current situation is not entirely devoid of opportunities.
GLP-1s has reignited investors’ interest in this industry, which will be long-term opportunity and bring alpha. With rich domestic/overseas catalysts ahead, related share price performance is worth looking forward to.
Among the domestic GLP-1s companies, Innovent is our top pick. The "concept validation" of Innovent’s business model has been completed. A qualitative change in the Company is coming soon.  


2024 High Conviction – China Healthcare: It's Time to Embrace a New Era

Asia Pac IPO & Placement Research, China biotech, Aequitas Research

Ke Yan, CFA, FRM

Asia Pac IPO & Placement Research, China biotech

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Quantitative Analysis

<ul>
<li>We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of November 17th.</li>
<li>The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.</li>
<li>We highlight Hongkong connect flows for Meituan, Tencent and Xiaomi.</li>
</ul>


We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of November 17th.
The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.
We highlight Hongkong connect flows for Meituan, Tencent and Xiaomi.


Hong Kong Connect Flows (Nov 17th): Meituan, Tencent, Xiaomi

Thematic (Sector/Industry)

<ul>
<li>While we’re optimistic about weight loss drug business, we also need to recognize the "true colors" of relevant companies, which helps us realize "when to participate and when to exit".</li>
<li>We analyzed the negatives/"flaws" of popular companies that favored by capital: <a href="https://www.smartkarma.com/entities/brightgene-bio-medical-technol" target="_blank" data-smartkarma-citation="entities:30356:1" rel="noopener">BrightGene Bio-Medical Technol (688166 CH)</a>, <a href="https://www.smartkarma.com/entities/hybio-pharmaceutical-co-ltd" target="_blank" data-smartkarma-citation="entities:20966:1" rel="noopener">Hybio Pharmaceutical (300199 CH)</a>, <a href="https://www.smartkarma.com/entities/hainan-poly-pharm-co-ltd" target="_blank" data-smartkarma-citation="entities:29739:1" rel="noopener">Hainan Poly Pharm (300630 CH), </a>Sinopep-Allsino, Kawin Technology, Highfine Biotech,etc.</li>
<li>Short-Term stock price rally are mainly driven by sentiment, but future valuation still needs to be supported by performance and fundamentals. Some companies are just conceptual hype in our view.</li>
</ul>


While we’re optimistic about weight loss drug business, we also need to recognize the "true colors" of relevant companies, which helps us realize "when to participate and when to exit".
We analyzed the negatives/"flaws" of popular companies that favored by capital: BrightGene Bio-Medical Technol (688166 CH), Hybio Pharmaceutical (300199 CH), Hainan Poly Pharm (300630 CH), Sinopep-Allsino, Kawin Technology, Highfine Biotech,etc.
Short-Term stock price rally are mainly driven by sentiment, but future valuation still needs to be supported by performance and fundamentals. Some companies are just conceptual hype in our view.


China’s China Weight Loss Drug Market Update – the Negatives and the True Colors

<ul>
<li>Globalization and innovation are two core paths for companies’ development, but with completely different effects.Instead of rushing to go global, it’s better to calm down to focus on R&amp;D first.</li>
<li>Many domestic companies choose Me-Too strategy, which is considered a “shortcut”. However, Me-Too strategy is not always successful. We analyzed different scenarios to help investors better distinguish valuable Me-Too strategies.</li>
<li>There could be a potential short-term correction in healthcare sector. Since trading opportunities remain, rebound would come next, but stock-picking would not be the same as in the past.</li>
</ul>


Globalization and innovation are two core paths for companies’ development, but with completely different effects.Instead of rushing to go global, it’s better to calm down to focus on R&amp;D first.
Many domestic companies choose Me-Too strategy, which is considered a “shortcut”. However, Me-Too strategy is not always successful. We analyzed different scenarios to help investors better distinguish valuable Me-Too strategies.
There could be a potential short-term correction in healthcare sector. Since trading opportunities remain, rebound would come next, but stock-picking would not be the same as in the past.


China Healthcare Weekly (Nov.3)-Share Price Correction,Valuable Shortcut,Globalization Vs Innovation

External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

<ul><li>Mazdutide (9mg) continues to show its BIC potential with 48-week results. Innovent released the 48-week results of mazdutide (9mg) in Ph2 study in Chinese obesity patients.</li><li>After 48 weeks of treatment, the placebo-adjusted mean percent change in body weight from baseline was -18.6% (-17.8kg) in 59 of the 80 enrolled patients with treatment extended.</li><li>Recall in May 2023, mazdutide (9mg) met the primary endpoint of its Ph2 trial in Chinese obesity patients, showing 15.4% placebo-adjusted weight loss at week 24 (vs 12.0% of tirzepatide 15mg and 8.0% of semaglutide, CMBI report. </li></ul><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

Mazdutide (9mg) continues to show its BIC potential with 48-week results. Innovent released the 48-week results of mazdutide (9mg) in Ph2 study in Chinese obesity patients.After 48 weeks of treatment, the placebo-adjusted mean percent change in body weight from baseline was -18.6% (-17.8kg) in 59 of the 80 enrolled patients with treatment extended.Recall in May 2023, mazdutide (9mg) met the primary endpoint of its Ph2 trial in Chinese obesity patients, showing 15.4% placebo-adjusted weight loss at week 24 (vs 12.0% of tirzepatide 15mg and 8.0% of semaglutide, CMBI report. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

China

Innovent Biologics, Inc. operates as a biopharmaceutical company. The Company develops, manufactures, and distributes monoclonal antibody drug candidates for the treatment of oncology, ophthalmology, autoimmune, cardiovascular, and other diseases. Innovent Biologics serves customers in China.

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Innovent Biologics Inc (1801 HK)

2024 High Conviction – China Healthcare: It's Time to Embrace a New Era

After a period of downturn, China healthcare has found new growth point. GLP-1s is an opportunity that can't be missed and will bring substantial...

Xinyao (Criss) Wang

Hong Kong Connect Flows (Nov 17th): Meituan, Tencent, Xiaomi

We analyzed southbound Hong Kong connect flows in the past week and highlight Hongkong connect flows for Meituan, Tencent and Xiaomi.

Ke Yan, CFA, FRM

China’s China Weight Loss Drug Market Update – the Negatives and the True Colors

Some popular companies are favored by capital on the back of enthusiasm for weight loss drugs, but sometimes it's just "conceptual hype". We need...

Xinyao (Criss) Wang

Innovent Biologics (1801 HK)

Mazdutide (9mg) continues to show its BIC potential with 48-week results. Innovent released the 48-week results of mazdutide (9mg) in Ph2 study in...

CMB International

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

2024 High Conviction – China Healthcare: It's Time to Embrace a New Era

After a period of downturn, China healthcare has found new growth point. GLP-1s is an opportunity that can't be missed and will bring substantial...

Xinyao (Criss) Wang

Hong Kong Connect Flows (Nov 17th): Meituan, Tencent, Xiaomi

We analyzed southbound Hong Kong connect flows in the past week and highlight Hongkong connect flows for Meituan, Tencent and Xiaomi.

Ke Yan, CFA, FRM

China’s China Weight Loss Drug Market Update – the Negatives and the True Colors

Some popular companies are favored by capital on the back of enthusiasm for weight loss drugs, but sometimes it's just "conceptual hype". We need...

Xinyao (Criss) Wang

China Healthcare Weekly (Nov.3)-Share Price Correction,Valuable Shortcut,Globalization Vs Innovation

Success of globalization ultimately relies on strong innovative capabilities. Here's how to distinguish valuable shortcuts - Me-Too strategy....

Xinyao (Criss) Wang

Innovent Biologics (1801 HK)

Mazdutide (9mg) continues to show its BIC potential with 48-week results. Innovent released the 48-week results of mazdutide (9mg) in Ph2 study in...

CMB International