Equity Analyst, LightStream Research

Oshadhi Kumarasiri

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Equity Bottom-Up

<p><a href="https://www.smartkarma.com/entities/pinduoduo-inc" target="_blank" data-smartkarma-citation="entities:27250:1" rel="noopener">Pinduoduo (PDD US)</a> is a Chinese e-commerce company that pioneered concepts like social e-commerce and team purchase. The company has experienced tremendous success since inception in 2015. Pinduoduo's success is driven mainly by active buyer growth as LTM active buyers rose 980% to 731m over the last 3 years. Meanwhile, the company’s share price rose 931% from the IPO price to $196.0 per ADS since listing on Nasdaq in July 2018 at $19.0 per ADS.</p>

Pinduoduo (PDD US) is a Chinese e-commerce company that pioneered concepts like social e-commerce and team purchase. The company has experienced tremendous success since inception in 2015. Pinduoduo's success is driven mainly by active buyer growth as LTM active buyers rose 980% to 731m over the last 3 years. Meanwhile, the company’s share price rose 931% from the IPO price to $196.0 per ADS since listing on Nasdaq in July 2018 at $19.0 per ADS.

Pinduoduo: Unlikely to Meet 4Q20 Consensus

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Quantitative Analysis

<div><p>The Asia Short Interest weekly looks at moves in market wide short interest and highlights movements in stock specific short interest across Hong Kong, Japan, Korea and Taiwan using the last available data published by the relevant authorities.</p></div><div><p>Hong Kong saw shorts rise on <a href="https://www.smartkarma.com/entities/lenovo-group-ltd" target="_blank" data-smartkarma-citation="entities:13359:1" rel="noopener">Lenovo (992 HK)</a>, <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent Holdings (700 HK)</a>, <a href="https://www.smartkarma.com/entities/aia-group-ltd" target="_blank" data-smartkarma-citation="entities:14895:1" rel="noopener">AIA Group Ltd (1299 HK)</a> and <a href="https://www.smartkarma.com/entities/nongfu-spring" target="_blank" data-smartkarma-citation="entities:28955:1" rel="noopener">Nongfu Spring (9633 HK)</a> while there was short covering on <a href="https://www.smartkarma.com/entities/ping-an-insurance-grp-co-of-china-ltd" target="_blank" data-smartkarma-citation="entities:12880:1" rel="noopener">Ping An Insurance (H) (2318 HK)</a>, <a href="https://www.smartkarma.com/entities/alibaba-group" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba Group (9988 HK)</a>, <a href="https://www.smartkarma.com/entities/wuxi-apptec" target="_blank" data-smartkarma-citation="entities:23679:1" rel="noopener">Wuxi Biologics (2269 HK)</a>, <a href="https://www.smartkarma.com/entities/jinxin-fertility-group-ltd" target="_blank" data-smartkarma-citation="entities:28003:1" rel="noopener">Jinxin Fertility Co Ltd (1951 HK)</a> and <a href="https://www.smartkarma.com/entities/jd-com-inc" target="_blank" data-smartkarma-citation="entities:29043:1" rel="noopener">JD.com Inc. (9618 HK)</a>. Shorts increased on Real Estate, Communication Services and Information Technology, while decreasing on Consumer Discretionary, Health Care and Financials.</p></div><div><p>In Japan, stocks that saw the most shorts were <a href="https://www.smartkarma.com/entities/toshiba-corp" target="_blank" data-smartkarma-citation="entities:637:1" rel="noopener">Toshiba Corp (6502 JP)</a>, <a href="https://www.smartkarma.com/entities/freee-kk" target="_blank" data-smartkarma-citation="entities:28424:1" rel="noopener">freee (4478 JP)</a>, <a href="https://www.smartkarma.com/entities/anritsu-corp" target="_blank" data-smartkarma-citation="entities:3700:1" rel="noopener">Anritsu Corp (6754 JP)</a> and <a href="https://www.smartkarma.com/entities/hino-motors-ltd" target="_blank" data-smartkarma-citation="entities:2144:1" rel="noopener">Hino Motors Ltd (7205 JP)</a> while shorts decreased on <a href="https://www.smartkarma.com/entities/itochu-corp" target="_blank" data-smartkarma-citation="entities:18448:1" rel="noopener">Itochu Corp (8001 JP)</a>, <a href="https://www.smartkarma.com/entities/canon-inc" target="_blank" data-smartkarma-citation="entities:1:1" rel="noopener">Canon Inc (7751 JP)</a>, <a href="https://www.smartkarma.com/entities/yaskawa-electric-corp" target="_blank" data-smartkarma-citation="entities:2458:1" rel="noopener">Yaskawa Electric (6506 JP)</a> and <a href="https://www.smartkarma.com/entities/taiyo-yuden-co-ltd" target="_blank" data-smartkarma-citation="entities:9924:1" rel="noopener">Taiyo Yuden (6976 JP)</a>. Sectorally, shorts increased marginally in Information Technology and Consumer Staples, while decreasing in Industrials and Communication Services.</p></div><div><p>In Korea, short increased on <a href="https://www.smartkarma.com/entities/samsung-electronics-co-ltd" target="_blank" data-smartkarma-citation="entities:191:1" rel="noopener">Samsung Electronics (005930 KS)</a>, <a href="https://www.smartkarma.com/entities/naver-corp" target="_blank" data-smartkarma-citation="entities:16029:1" rel="noopener">Naver Corp (035420 KS)</a>, <a href="https://www.smartkarma.com/entities/samsung-sdi-co-ltd" target="_blank" data-smartkarma-citation="entities:503:1" rel="noopener">Samsung SDI (006400 KS)</a> and <a href="https://www.smartkarma.com/entities/kia-motors-corp" target="_blank" data-smartkarma-citation="entities:156:1" rel="noopener">Kia Motors Corp (000270 KS)</a> while shorts decreased on <a href="https://www.smartkarma.com/entities/celltrion-inc" target="_blank" data-smartkarma-citation="entities:991:1" rel="noopener">Celltrion Inc (068270 KS)</a>, <a href="https://www.smartkarma.com/entities/gs-engineering-construct" target="_blank" data-smartkarma-citation="entities:15916:1" rel="noopener">GS Engineering &amp; Construction (006360 KS)</a> and <a href="https://www.smartkarma.com/entities/hana-financial-group" target="_blank" data-smartkarma-citation="entities:12843:1" rel="noopener">Hana Financial (086790 KS)</a>. </p></div><div><p>Stocks in Taiwan that saw the highest increase in shorts were <a href="https://www.smartkarma.com/entities/pegatron-corp" target="_blank" data-smartkarma-citation="entities:12852:1" rel="noopener">Pegatron Corp (4938 TT)</a>, <a href="https://www.smartkarma.com/entities/asmedia-technology-inc" target="_blank" data-smartkarma-citation="entities:15732:1" rel="noopener">Asmedia Technology (5269 TT)</a>, <a href="https://www.smartkarma.com/entities/taiwan-semiconductor-manufacturing-company" target="_blank" data-smartkarma-citation="entities:11230:1" rel="noopener">TSMC (2330 TT)</a> and <a href="https://www.smartkarma.com/entities/largan-precision-co-ltd" target="_blank" data-smartkarma-citation="entities:9126:1" rel="noopener">Largan Precision (3008 TT)</a> while shorts were covered on <a href="https://www.smartkarma.com/entities/united-microelectronics-corp" target="_blank" data-smartkarma-citation="entities:6450:1" rel="noopener">United Microelectronics Corp (2303 TT)</a>, <a href="https://www.smartkarma.com/entities/au-optronics-corp" target="_blank" data-smartkarma-citation="entities:6704:1" rel="noopener">Au Optronics (2409 TT)</a>, <a href="https://www.smartkarma.com/entities/alchip-technologies-ltd" target="_blank" data-smartkarma-citation="entities:20219:1" rel="noopener">Alchip Technologies (3661 TT)</a> and <a href="https://www.smartkarma.com/entities/flexium-interconnect-inc" target="_blank" data-smartkarma-citation="entities:15897:1" rel="noopener">Flexium Interconnect (6269 TT)</a>.</p></div>

The Asia Short Interest weekly looks at moves in market wide short interest and highlights movements in stock specific short interest across Hong Kong, Japan, Korea and Taiwan using the last available data published by the relevant authorities.Hong Kong saw shorts rise on Lenovo (992 HK), Tencent Holdings (700 HK), AIA Group Ltd (1299 HK) and Nongfu Spring (9633 HK) while there was short covering on Ping An Insurance (H) (2318 HK), Alibaba Group (9988 HK), Wuxi Biologics (2269 HK), Jinxin Fertility Co Ltd (1951 HK) and JD.com Inc. (9618 HK). Shorts increased on Real Estate, Communication Services and Information Technology, while decreasing on Consumer Discretionary, Health Care and Financials.In Japan, stocks that saw the most shorts were Toshiba Corp (6502 JP), freee (4478 JP), Anritsu Corp (6754 JP) and Hino Motors Ltd (7205 JP) while shorts decreased on Itochu Corp (8001 JP), Canon Inc (7751 JP), Yaskawa Electric (6506 JP) and Taiyo Yuden (6976 JP). Sectorally, shorts increased marginally in Information Technology and Consumer Staples, while decreasing in Industrials and Communication Services.In Korea, short increased on Samsung Electronics (005930 KS), Naver Corp (035420 KS), Samsung SDI (006400 KS) and Kia Motors Corp (000270 KS) while shorts decreased on Celltrion Inc (068270 KS), GS Engineering &amp; Construction (006360 KS) and Hana Financial (086790 KS). Stocks in Taiwan that saw the highest increase in shorts were Pegatron Corp (4938 TT), Asmedia Technology (5269 TT), TSMC (2330 TT) and Largan Precision (3008 TT) while shorts were covered on United Microelectronics Corp (2303 TT), Au Optronics (2409 TT), Alchip Technologies (3661 TT) and Flexium Interconnect (6269 TT).

Asia Short Interest: Lenovo, AIA, Nongfu, Wuxi Bio, Toshiba, Freee, Canon, Samsung, Celltrion, TSMC

Overseas Chinese Equities, Aequitas Research

Ming Lu

Overseas Chinese Equities

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.

<ul>
<li>Online karaoke’ active users decreased by 31% and the time on site decreased by 13%<a target="_blank"> in China</a>.</li>
<li>Music per capita time on site plunged sharply by 26% in China.</li>
<li>Monthly active users of TME’s top app shrank.</li>
<li>China Mobile’s music app is freely using TME’s copyrights.</li>
</ul>


Online karaoke’ active users decreased by 31% and the time on site decreased by 13% in China.
Music per capita time on site plunged sharply by 26% in China.
Monthly active users of TME’s top app shrank.
China Mobile’s music app is freely using TME’s copyrights.


Tencent Music (TME): Less Attractive than Other Entertainments

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

Event-Driven

<p>On 22nd March 2018, after market close in Hong Kong one of the largest overnight placements was launched. On that day, <a href="https://www.smartkarma.com/entities/naspers-ltd" target="_blank" data-smartkarma-citation="entities:21085:1" rel="noopener">Naspers (NPN SJ)</a> reluctantly sold US$10bn worth of <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent Holdings (700 HK)</a> shares. </p><p>I say reluctantly because Naspers provided a three year lock-up at the time of the deal. That lock-up will expire next month. </p><p>We have covered the previous placement in our earlier note, <a href="https://www.smartkarma.com/insights/tencent-placement-huge-deal-in-size-small-in-relative-terms-succumbing-to-the-holdco-discount" target="_blank" rel="noopener">Tencent Placement - Huge Deal in Size, Small in Relative Terms - Succumbing to the HoldCo Discount</a>. </p><p>In this note, I’ll talk about the upcoming lock-up expiry, its implications and the updates since then.</p>

On 22nd March 2018, after market close in Hong Kong one of the largest overnight placements was launched. On that day, Naspers (NPN SJ) reluctantly sold US$10bn worth of Tencent Holdings (700 HK) shares. I say reluctantly because Naspers provided a three year lock-up at the time of the deal. That lock-up will expire next month. We have covered the previous placement in our earlier note, Tencent Placement - Huge Deal in Size, Small in Relative Terms - Succumbing to the HoldCo Discount. In this note, I’ll talk about the upcoming lock-up expiry, its implications and the updates since then.

Tencent Placement Lock-Up Expiry - US$10bn+ Block and Buyback Linked Holdco Trade

Chief Economist

Diana Choyleva

Enodo Economics

Enodo Economics is an independent macroeconomic forecasting company that untangles complexity, challenges the consensus, and makes sense of the future. Our focus is on China – one of the most misunderstood economies in the world, but one of the most important to figure out.  Enodo’s chief economist, Diana Choyleva, has been analysing China for almost 20 years, while Enodo’s team boasts a combined 140 years’ experience covering China’s economy, politics and markets. 

Macroeconomics

<h2>China News That Matters</h2><ul>
<li>Comedy smashes box office in land of open cinemas</li>
<li>Biden warns of repercussions for Xinjiang</li>
<li>The whole truth, and nothing but the truth?</li>
<li>New wave of China tech IPOs for 2021</li>
</ul><div class="content-remarks"><p>In my weekly digest China News That Matters, I will give you selected summaries, sourced from a variety of local Chinese-language and international news outlets, and highlight why I think the news is significant. These posts are meant to neither be bullish nor bearish, but help you separate the signal from the noise.</p></div>

China News That Matters
Comedy smashes box office in land of open cinemas
Biden warns of repercussions for Xinjiang
The whole truth, and nothing but the truth?
New wave of China tech IPOs for 2021
In my weekly digest China News That Matters, I will give you selected summaries, sourced from a variety of local Chinese-language and international news outlets, and highlight why I think the news is significant. These posts are meant to neither be bullish nor bearish, but help you separate the signal from the noise.

Consumption/ US-China/ Covid-19/ Tech IPOs

China

Alibaba Group Holding Limited provides online sales services. The Company provides internet infrastructure, electronic commerce, online financial, and internet content services through its subsidiaries. Alibaba Group Holding offers its products and services worldwide.

Price Gauge
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Alibaba Group Holding (BABA US)

Pinduoduo: Unlikely to Meet 4Q20 Consensus

During its short tenure on Nasdaq, Pinduoduo has twice failed to meet consensus quarterly revenue estimates and its share price declined by...

Oshadhi Kumarasiri

Asia Short Interest: Lenovo, AIA, Nongfu, Wuxi Bio, Toshiba, Freee, Canon, Samsung, Celltrion, TSMC

The Insight looks at large short interest movements across HK, Japan, Korea and Taiwan stocks and highlights large increases/decreases in shorts to...

Brian Freitas

Tencent Music (TME): Less Attractive than Other Entertainments

Online karaoke and online music plunged in China. Monthly active users of TME’s top app shrank. China Mobile’s music app is freely using TME’s...

Ming Lu

Tencent Placement Lock-Up Expiry - US$10bn+ Block and Buyback Linked Holdco Trade

On 22nd March 2018, after market close, one of the largest overnight placements was launched. On that day, Naspers reluctantly sold US$10bn worth...

Sumeet Singh

Consumption/ US-China/ Covid-19/ Tech IPOs

In my weekly digest, I will give you selected summaries, sourced from a variety of local Chinese-language and international news outlets, and...

Diana Choyleva

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)