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 analyse the changes of A-H premium on 150 stocks over the last week. The average A-H premium was 98.8% as of Nov 8th.</li>
<li>The average A-H premium changed by -0.1ppt week-on-week, led by utilities, real estate, financials and offset by consumer staples, information technology, energy.</li>
<li>We highlight weekly changes in A-H premium for BAIYUNSHAN PH, SMIC, PICC, CHINA LIFE, FDZJ.</li>
</ul>


We analyse the changes of A-H premium on 150 stocks over the last week. The average A-H premium was 98.8% as of Nov 8th.
The average A-H premium changed by -0.1ppt week-on-week, led by utilities, real estate, financials and offset by consumer staples, information technology, energy.
We highlight weekly changes in A-H premium for BAIYUNSHAN PH, SMIC, PICC, CHINA LIFE, FDZJ.


A-H Premium Weekly (Nov 8th):Baiyunshan, SMIC, PICC, CHINA LIFE, FDZJ

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>SOUTHBOUND gross trading activity bounced sharply. Net buying increased sharply too. 9 names traded more than US$1bn. The top 3 names saw US$8.6bn of buying. </li>
<li>The trend continues to net sales of ETFs and high div SOEs. net buying is very, very broad-based. </li>
<li>I expect HK-listed tech to continue getting bought. It is something of a safe haven against Trump tariffs as they don't compete in the US much.</li>
</ul>


SOUTHBOUND gross trading activity bounced sharply. Net buying increased sharply too. 9 names traded more than US$1bn. The top 3 names saw US$8.6bn of buying. 
The trend continues to net sales of ETFs and high div SOEs. net buying is very, very broad-based. 
I expect HK-listed tech to continue getting bought. It is something of a safe haven against Trump tariffs as they don't compete in the US much.


HK Connect SOUTHBOUND Flows (To 8 Nov 2024); High-Div SOEs Sold, Tech Bought... Again

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

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

<ul>
<li>There could be 17 changes at the December rebalance with the Industrials and Materials sectors could gaining 2 spots each and the Information Technology sector losing 3 spots.</li>
<li>Estimated one-way turnover of 3% at the December rebalance leading to a one-way trade of CNY 30.2bn (US$4.3bn). There are 14 stocks with over 2x ADV to trade.</li>
<li>The forecast adds have outperformed the forecast deletes over the last month despite rising markets and a wall of money flowing into <a href="https://www.smartkarma.com/entities/shanghai-shenzhen-csi-300-index" target="_blank" data-smartkarma-citation="entities:22906:1" rel="noopener">Shanghai Shenzhen CSI 300 Index (SHSZ300 INDEX)</a> ETFs.</li>
</ul>


There could be 17 changes at the December rebalance with the Industrials and Materials sectors could gaining 2 spots each and the Information Technology sector losing 3 spots.
Estimated one-way turnover of 3% at the December rebalance leading to a one-way trade of CNY 30.2bn (US$4.3bn). There are 14 stocks with over 2x ADV to trade.
The forecast adds have outperformed the forecast deletes over the last month despite rising markets and a wall of money flowing into Shanghai Shenzhen CSI 300 Index (SHSZ300 INDEX) ETFs.


CSI300 Index Rebalance Preview: Rising Markets and ETF Creations Take Round-Trip Trade to US$8.5bn

Pan-Asia Index Flows & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Pan-Asia Index Flows & Special Situations

<ul>
<li>SSE 50 and SSE 180, respectively, aim to represent the performance of the 50 and 180 largest and most liquid A-share stocks listed on the Shanghai Stock Exchange.</li>
<li>The reference period is for the December 2024 index rebal event is now complete. In this insight, we have presented our final list of expected ADDs and DELs.</li>
<li><em>While our SSE 50 expected ADDs/DELs list remains unchanged, there have been multiple last-minute changes to our SSE 180 expected ADDs/DELs list.</em></li>
</ul>


SSE 50 and SSE 180, respectively, aim to represent the performance of the 50 and 180 largest and most liquid A-share stocks listed on the Shanghai Stock Exchange.
The reference period is for the December 2024 index rebal event is now complete. In this insight, we have presented our final list of expected ADDs and DELs.
While our SSE 50 expected ADDs/DELs list remains unchanged, there have been multiple last-minute changes to our SSE 180 expected ADDs/DELs list.


Quiddity Leaderboard SSE50/180 Dec 24: Multiple Changes to Expectations; ~US$2.3bn Collective Flows

HK/China Equity Long-Short

Osbert Tang, CFA

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/dongfang-electric-corporation-limited" target="_blank" data-smartkarma-citation="entities:1251:1" rel="noopener">Dongfang Electric (1072 HK)</a> showed encouraging QoQ improvements in profit trend, margins, new orders, and operating cash flow in 3Q24, though reported profit was still down in 9M24.</li>
<li>Cost control has contributed to 4.6pp QoQ gross margin expansion. Meanwhile, new order growth has accelerated to 63.8% YoY, from just a teens level in 1Q24 and 2Q24.</li>
<li>Our estimate suggests that backlog is enough to cover 1.9x its annual revenue, enhancing visibility. Its PER, dividend yield and P/B are all standing on attractive levels.</li>
</ul>



Dongfang Electric (1072 HK) showed encouraging QoQ improvements in profit trend, margins, new orders, and operating cash flow in 3Q24, though reported profit was still down in 9M24.
Cost control has contributed to 4.6pp QoQ gross margin expansion. Meanwhile, new order growth has accelerated to 63.8% YoY, from just a teens level in 1Q24 and 2Q24.
Our estimate suggests that backlog is enough to cover 1.9x its annual revenue, enhancing visibility. Its PER, dividend yield and P/B are all standing on attractive levels.


Dongfang Electric (1072 HK): Good Sequential Improvement Masked

China

Shanghai Electric Group Company Limited, through its subsidiaries, designs, manufactures, sells, and services a wide range of products and services in the power equipment, electromechanical equipment, transportation equipment and environmental system industries.

Shanghai Electric Group Company (2727 HK)

Price Gauge
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Shanghai Electric Group Company (2727 HK)

A-H Premium Weekly (Nov 8th):Baiyunshan, SMIC, PICC, CHINA LIFE, FDZJ

We analyzed A-H premium changes in the past week and highlight A-H premium changes for baiyunshan, SMIC, PICC, CHINA LIFE, FDZJ.

Ke Yan, CFA, FRM

HK Connect SOUTHBOUND Flows (To 8 Nov 2024); High-Div SOEs Sold, Tech Bought... Again

SOUTHBOUND was a Very Big Buyer of HK shares last week. Given the movement in ADRs after the close because of no fiscal stim, one should expect...

Travis Lundy

CSI300 Index Rebalance Preview: Rising Markets and ETF Creations Take Round-Trip Trade to US$8.5bn

There could be 17 changes in Dec. Estimated 1-way turnover is 3%; 1-way trade is US$4.3bn. There are 14 stocks with over 2x ADV to trade. The adds...

Brian Freitas

Quiddity Leaderboard SSE50/180 Dec 24: Multiple Changes to Expectations; ~US$2.3bn Collective Flows

We estimate SSE 50 one-way flow to be US$1.98bn and SSE 180 one-way flow to be US$286mn during the December 2024 index rebal event.

Janaghan Jeyakumar, CFA

Dongfang Electric (1072 HK): Good Sequential Improvement Masked

DEC shows positive QoQ improvements in profit trend, margins, new orders, and cash flow in 3Q24, despite a reported profit decline in 9M24. Order...

Osbert Tang, CFA

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

A-H Premium Weekly (Nov 8th):Baiyunshan, SMIC, PICC, CHINA LIFE, FDZJ

We analyzed A-H premium changes in the past week and highlight A-H premium changes for baiyunshan, SMIC, PICC, CHINA LIFE, FDZJ.

Ke Yan, CFA, FRM

HK Connect SOUTHBOUND Flows (To 8 Nov 2024); High-Div SOEs Sold, Tech Bought... Again

SOUTHBOUND was a Very Big Buyer of HK shares last week. Given the movement in ADRs after the close because of no fiscal stim, one should expect...

Travis Lundy

CSI300 Index Rebalance Preview: Rising Markets and ETF Creations Take Round-Trip Trade to US$8.5bn

There could be 17 changes in Dec. Estimated 1-way turnover is 3%; 1-way trade is US$4.3bn. There are 14 stocks with over 2x ADV to trade. The adds...

Brian Freitas

Quiddity Leaderboard SSE50/180 Dec 24: Multiple Changes to Expectations; ~US$2.3bn Collective Flows

We estimate SSE 50 one-way flow to be US$1.98bn and SSE 180 one-way flow to be US$286mn during the December 2024 index rebal event.

Janaghan Jeyakumar, CFA

Dongfang Electric (1072 HK): Good Sequential Improvement Masked

​DEC shows positive QoQ improvements in profit trend, margins, new orders, and cash flow in 3Q24, despite a reported profit decline in 9M24. Order...

Osbert Tang, CFA

DEC shows positive QoQ improvements in profit trend, margins, new orders, and cash flow in 3Q24, despite a reported profit decline in 9M24. Order...