ASEAN Insight Provider, CrossASEAN Research

Angus Mackintosh

ASEAN Insight Provider

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

Equity Bottom-Up

<p>Shopee, the e-commerce arm of <a href="https://www.smartkarma.com/entities/sea-ltd" target="_blank" data-smartkarma-citation="entities:8509:1" rel="noopener">Sea Ltd (SE US)</a> has quietly launched ShopeeFood in Indonesia. This could potentially pose a threat to both <a href="https://www.smartkarma.com/entities/gojek" target="_blank" data-smartkarma-citation="entities:25976:1" rel="noopener">Gojek (1379371D IJ)</a> and <a href="https://www.smartkarma.com/entities/grabtaxi-holdings-pte-ltd" target="_blank" data-smartkarma-citation="entities:26950:1" rel="noopener">Grab (0967655D SP)</a>, which currently dominate the food delivery market between them. </p>
<p>The two incumbent players do have a head start and an edge on logistics. ShopeePay's success in digital payments shows the company's ability to grab share quickly, suggesting that the firm’s new food delivery unit could be a force to be reckoned with.</p>
<p>There will also be synergies with ShopeePay, which could potentially provide discounts and cashback but overall it will help to increase the stickiness of the Shopee App.</p>
<p>The total gross merchandise value of the food delivery market in Indonesia reportedly amounted to US$3.7bn in 2020. If we were to assume that the market can grow by +15% in 2021 to US$4.2bn and Shopee could take 25% of the market then it could be worth US$1bn in GMV to Shopee.</p>
<p>Shopee certainly has the financial capacity to hire drivers, with the ShopeeFood Driver app, which is available on the google store already has over 100,000 downloads. Onboarding big and small will be key</p>
<p>Shopee’s biggest advantage over competitors remains its strength in terms of funding, given that it generates huge amounts of cash through its gaming business. <a href="https://www.smartkarma.com/entities/sea-ltd" target="_blank" data-smartkarma-citation="entities:8509:1" rel="noopener">Sea Ltd (SE US)</a> could now decide to channel resources into Shopee Food to grow that business rapidly.</p>
<p>It is early days for Shopee Food but it has the potential to be another revenue driver for the company, which will underpin future growth and hence its premium valuations. <a href="https://www.smartkarma.com/entities/sea-ltd" target="_blank" data-smartkarma-citation="entities:8509:1" rel="noopener">Sea Ltd (SE US)</a> trades on 13.3x FY21E EV/Sales and 9.5x FY22E EV/sales, with estimated sales growth of +78.8% and +38.4% for FY21E and FY22E respectively. </p>
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Shopee, the e-commerce arm of Sea Ltd (SE US) has quietly launched ShopeeFood in Indonesia. This could potentially pose a threat to both Gojek (1379371D IJ) and Grab (0967655D SP), which currently dominate the food delivery market between them. 
The two incumbent players do have a head start and an edge on logistics. ShopeePay's success in digital payments shows the company's ability to grab share quickly, suggesting that the firm’s new food delivery unit could be a force to be reckoned with.
There will also be synergies with ShopeePay, which could potentially provide discounts and cashback but overall it will help to increase the stickiness of the Shopee App.
The total gross merchandise value of the food delivery market in Indonesia reportedly amounted to US$3.7bn in 2020. If we were to assume that the market can grow by +15% in 2021 to US$4.2bn and Shopee could take 25% of the market then it could be worth US$1bn in GMV to Shopee.
Shopee certainly has the financial capacity to hire drivers, with the ShopeeFood Driver app, which is available on the google store already has over 100,000 downloads. Onboarding big and small will be key
Shopee’s biggest advantage over competitors remains its strength in terms of funding, given that it generates huge amounts of cash through its gaming business. Sea Ltd (SE US) could now decide to channel resources into Shopee Food to grow that business rapidly.
It is early days for Shopee Food but it has the potential to be another revenue driver for the company, which will underpin future growth and hence its premium valuations. Sea Ltd (SE US) trades on 13.3x FY21E EV/Sales and 9.5x FY22E EV/sales, with estimated sales growth of +78.8% and +38.4% for FY21E and FY22E respectively. 







Sea Ltd (SE US) - The Stickiness of Shopee Food

Chart based progressive global trading strategies, Chart Partners

Thomas Schroeder

Chart based progressive global trading strategies

Chart Partners

Chart Partners objective is to discover medium-term cycle turns and profit opportunities before they unfold, within structural trends while preserving capital with clear degrees of risk. We have real return ideas. 

Markets are dynamic and trading systems must reflect this. It is crucial to determine underlying correlations and lead-lag relationships within global markets and the impact on linked instruments. Our weekly Chartonics product gives you short-term trading strategies that can be applied within the medium and longer term macro trends that are mapped out in our strategy updates. 

Our methodology fuses global market variables and isolates drivers in trends. We specialize in FX, index trade in NY and Asia with a focus on Asian stocks. 

Technical Analysis

Alibaba Group Holding  / Technical Analysis

<p><a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd" target="_blank" data-smartkarma-citation="entities:787:1" rel="noopener">Alibaba Group (BABA US)</a> still has some basing work to complete before a fresh rally cycle can unfold. Current bearish flat sets a heavy tone to press below trendline support (a brief affair) and sets up a long with price and RSI buy levels aligning.</p><p>We outline a micro short trade if we tick up to 240 below the 245 pivot resistance.</p><p>The directional trade is to get long on a break below trendline support (220) near the 205 price level while aligning the RSI low target.</p>

Alibaba Group (BABA US) still has some basing work to complete before a fresh rally cycle can unfold. Current bearish flat sets a heavy tone to press below trendline support (a brief affair) and sets up a long with price and RSI buy levels aligning.We outline a micro short trade if we tick up to 240 below the 245 pivot resistance.The directional trade is to get long on a break below trendline support (220) near the 205 price level while aligning the RSI low target.

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 class="">
<li>Xiaomi plans to produce electric vehicle.</li>
<li>The court forces Douyu to compensate Huya for broadcaster poaching.</li>
<li>Tencent Music and Vipshop launch share repurchase programs.</li>
</ul>
<p><strong>Our coverage on Chinese equities:</strong></p>
<p>E-commerce: Alibaba (9988 HK, BABA US), Meituan (3690 HK), JD.com (9618 HK, JD US), JD Health (6618 HK), KE (BEKE US).</p>
<p>Online Entertainment: Tencent (700 HK), Kuaishou (1024 HK), NetEase (9999 HK, NTES US), Bilibili (BILI US), Tencent Music (TME).</p>
<p>Others: Xiaomi (1810 HK).</p>


Xiaomi plans to produce electric vehicle.
The court forces Douyu to compensate Huya for broadcaster poaching.
Tencent Music and Vipshop launch share repurchase programs.

Our coverage on Chinese equities:
E-commerce: Alibaba (9988 HK, BABA US), Meituan (3690 HK), JD.com (9618 HK, JD US), JD Health (6618 HK), KE (BEKE US).
Online Entertainment: Tencent (700 HK), Kuaishou (1024 HK), NetEase (9999 HK, NTES US), Bilibili (BILI US), Tencent Music (TME).
Others: Xiaomi (1810 HK).

China Internet Weekly (Apr 5): Xiaomi Plans Electric Vehicle, Huya Gets Compensation from Douyu

Global Emerging Market Equities, Propitious Research

Wium Malan, CFA

Global Emerging Market Equities

<p>Over the past two weeks, there have been two significant negative catalytic events (SEC moved forward on the road to a potential US delisting and missed margin calls by Archegos Capital Management created a forced seller) which has placed significant pressure on the Baidu share price, listed in the US <a href="https://www.smartkarma.com/entities/baidu-inc" target="_blank" data-smartkarma-citation="entities:179:1" rel="noopener">Baidu (BIDU US)</a> and Hong Kong <a href="https://www.smartkarma.com/entities/baidu-inc-a55ca720-5968-48f0-8194-ac94390d065c" target="_blank" data-smartkarma-citation="entities:32212:1" rel="noopener">Baidu (9888 HK)</a>.  </p>
<p>In this insight, I analyse the impact of recent share price movements on Baidu’s valuation and what that implies for the Core Search and Non-marketing Core operations. </p>

Over the past two weeks, there have been two significant negative catalytic events (SEC moved forward on the road to a potential US delisting and missed margin calls by Archegos Capital Management created a forced seller) which has placed significant pressure on the Baidu share price, listed in the US Baidu (BIDU US) and Hong Kong Baidu (9888 HK).  
In this insight, I analyse the impact of recent share price movements on Baidu’s valuation and what that implies for the Core Search and Non-marketing Core operations. 

Baidu: Attractive Short Term Entry Point Following SEC Statement and Block Sales

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Equity Capital Markets

Smart Share Global / Equity Capital Markets

<div><p><a href="https://www.smartkarma.com/entities/energy-monster" target="_blank" data-smartkarma-citation="entities:32217:1" rel="noopener">Smart Share Global (EM US)</a> is the largest mobile device charging service provider in China as measured by gross revenues in 2020, according to iResearch. Smart Share is backed by <a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd" target="_blank" data-smartkarma-citation="entities:787:1" rel="noopener">Alibaba Group (BABA US)</a> (16.5% stake), Hillhouse Capital (11.7% stake) and <a href="https://www.smartkarma.com/entities/xiaomi-corp" target="_blank" data-smartkarma-citation="entities:24409:1" rel="noopener">Xiaomi Corp (1810 HK)</a> (7.5% stake). </p></div><div><p>At the mid-point of the proposed IPO price range of $10.50-12.50 per ADS, Smart Share will have a market cap of $2.9 billion. At the mid-point of the IPO price range, the net proceeds are $183.6 million. Smart Share has received indications of interest of $110 million worth of ADSs from insiders - Hillhouse Capital ($50 million), Aspex Master Fund ($50 million) and Xiaomi ($10 million).</p></div><div><div><div class="content-highlight"><p>In <a href="https://www.smartkarma.com/insights/smart-share-global-ipo-initiation-charging-ahead" target="_blank" data-smartkarma-citation="insights:49389" rel="noopener">Smart Share Global IPO Initiation: Charging Ahead</a>, we opined Smart Share is well-positioned to tap into the fast-growing mobile device charging service market. We concluded that Smart Share’s fundamentals are attractive. Our valuation analysis suggests that the IPO price range is attractive. Overall, we would participate in the IPO. </p></div></div></div>

Smart Share Global (EM US) is the largest mobile device charging service provider in China as measured by gross revenues in 2020, according to iResearch. Smart Share is backed by Alibaba Group (BABA US) (16.5% stake), Hillhouse Capital (11.7% stake) and Xiaomi Corp (1810 HK) (7.5% stake). At the mid-point of the proposed IPO price range of $10.50-12.50 per ADS, Smart Share will have a market cap of $2.9 billion. At the mid-point of the IPO price range, the net proceeds are $183.6 million. Smart Share has received indications of interest of $110 million worth of ADSs from insiders - Hillhouse Capital ($50 million), Aspex Master Fund ($50 million) and Xiaomi ($10 million).In Smart Share Global IPO Initiation: Charging Ahead, we opined Smart Share is well-positioned to tap into the fast-growing mobile device charging service market. We concluded that Smart Share’s fundamentals are attractive. Our valuation analysis suggests that the IPO price range is attractive. Overall, we would participate in the IPO. 

Smart Share Global IPO: Valuation Insights

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.

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Alibaba Group Holding (BABA US)

Sea Ltd (SE US) - The Stickiness of Shopee Food

The launch of ShopeeFood in Indonesia potentially represents a threat to Gojek and Grab but also a potential future growth engine for Sea Ltd in...

Angus Mackintosh

BABA Long Entry Target

Alibaba Group (BABA US) still has some basing work to complete. Current bearish flat sets a heavy tone to break trendline support (a brief affair)...

Thomas Schroeder

China Internet Weekly (Apr 5): Xiaomi Plans Electric Vehicle, Huya Gets Compensation from Douyu

Xiaomi plans to produce electric vehicle.The court forces Douyu to compensate Huya for broadcaster poaching.Tencent Music and Vipshop launches...

Ming Lu

Baidu: Attractive Short Term Entry Point Following SEC Statement and Block Sales

In this insight, I analyse the impact of recent share price movements on Baidu’s valuation and what that implies for the Core Search and Non...

Wium Malan, CFA

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52-week Range

Market Cap (USDm)

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Sea Ltd (SE US) - The Stickiness of Shopee Food

The launch of ShopeeFood in Indonesia potentially represents a threat to Gojek and Grab but also a potential future growth engine for Sea Ltd in...

Angus Mackintosh

BABA Long Entry Target

Alibaba Group (BABA US) still has some basing work to complete. Current bearish flat sets a heavy tone to break trendline support (a brief affair)...

Thomas Schroeder

China Internet Weekly (Apr 5): Xiaomi Plans Electric Vehicle, Huya Gets Compensation from Douyu

Xiaomi plans to produce electric vehicle.The court forces Douyu to compensate Huya for broadcaster poaching.Tencent Music and Vipshop launches...

Ming Lu

Baidu: Attractive Short Term Entry Point Following SEC Statement and Block Sales

In this insight, I analyse the impact of recent share price movements on Baidu’s valuation and what that implies for the Core Search and Non...

Wium Malan, CFA

Smart Share Global IPO: Valuation Insights

The net proceeds are $183.6m at the mid-point of the IPO price range. Hillhouse, Apax Master and Xiaomi will subscribe for $110m. Overall, the...

Arun George