Pan-Asia Index Flows & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Pan-Asia Index Flows & Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Event-Driven

<ul>
<li>The HSTECH Index tracks the performance of the top 30 technology companies listed in Hong Kong that have high business exposure to certain technology themes.</li>
<li>The index changes for HSTECH index for the March 2024 index rebal event will be announced on 16th February 2024. </li>
<li>In this insight, we take a final look at the expected index changes and our latest flow expectations.</li>
</ul>


The HSTECH Index tracks the performance of the top 30 technology companies listed in Hong Kong that have high business exposure to certain technology themes.
The index changes for HSTECH index for the March 2024 index rebal event will be announced on 16th February 2024. 
In this insight, we take a final look at the expected index changes and our latest flow expectations.


Quiddity HSTECH Mar 24 Flow Expectations: US$415mn One-Way if the Low-Conviction Change Takes Place

<ul>
<li>The HSCEI serves as a benchmark to reflect the overall performance of the top 50 "Mainland China" securities listed in Hong Kong.</li>
<li>The index changes for HSCEI index for the March 2024 index rebal event will be announced on 16th February 2024. </li>
<li>In this insight, I have shown how my flow expectations have changed since I published my last HSCEI insight on 6th December 2023.</li>
</ul>


The HSCEI serves as a benchmark to reflect the overall performance of the top 50 "Mainland China" securities listed in Hong Kong.
The index changes for HSCEI index for the March 2024 index rebal event will be announced on 16th February 2024. 
In this insight, I have shown how my flow expectations have changed since I published my last HSCEI insight on 6th December 2023.


Quiddity HSCEI Mar 24 Flow Expectations: Zhongsheng (881 HK) Downtrend Could Continue

Blue Lotus Non US Internet research, Blue Lotus Research Institute

Ying Pan

Blue Lotus Non US Internet research

China growth and global non-US Internet equities

Blue Lotus Research Institute

Blue Lotus Research is a Hong Kong Type 4 Licensed investment advisory firm focusing on Chinese growth equities and global non-US Internet equities

Thematic (Sector/Industry)

<ul>
<li>JD/BABA/PDD : JD increases salaries for customer service staff (-)</li>
<li>700 HK: News has surfaced indicating that Tencent is in the process of developing a mobile game adaptation of "Elden Ring." (+) </li>
<li>700 HK/LKNCY: Tencent's &lt;Dream Star&gt; has collaborated with Luckin Coffee for a co-branding initiative (+)</li>
</ul>


JD/BABA/PDD : JD increases salaries for customer service staff (-)
700 HK: News has surfaced indicating that Tencent is in the process of developing a mobile game adaptation of "Elden Ring." (+) 
700 HK/LKNCY: Tencent's &lt;Dream Star&gt; has collaborated with Luckin Coffee for a co-branding initiative (+)


[Blue Lotus Daily - TMT Update]:JD/BABA/PDD/700 HK/LKNCY

Asian Equities Analyst, Logistics & Transport, Tracking Traffic

Daniel Hellberg

Asian Equities Analyst, Logistics & Transport

Tracking Traffic

Focusing on Asian logistics, transportation, and travel companies

Equity Capital Markets

Cainiao Smart Logistics Network / Equity Capital Markets

<ul>
<li>CaiNiao's revenue growth remained strong, up +24% Y/Y in December quarter</li>
<li>EBITA turned positive from loss in prior year period, but margin &lt; FYQ2</li>
<li>Overall, an impressive set of results that distinguishes CaiNiao from express peers</li>
</ul>


CaiNiao's revenue growth remained strong, up +24% Y/Y in December quarter
EBITA turned positive from loss in prior year period, but margin &lt; FYQ2
Overall, an impressive set of results that distinguishes CaiNiao from express peers


CaiNiao's FYQ3: Solid Revenue Growth & EBITA Margin Improvement Distinguish It From Express Peers

Greater China Equity Long/Short Analyst

Eric Chen

<ul>
<li>We argued in last follow-up note that property woes and challenging macro situation would keep pressuring China online marketplaces’ valuation despite their improving profitability and cashflow.</li>
<li>The sector’s brutal de-rating since last 4Q has been pricing in a dire growth outlook and it is closer to the end of tunnel in our view.</li>
<li>We expect a lackluster 4Q23 results season for the sector in general but also less share price volatility given extremely depressed valuation. Stay positive over 12-month time horizon.</li>
</ul>


We argued in last follow-up note that property woes and challenging macro situation would keep pressuring China online marketplaces’ valuation despite their improving profitability and cashflow.
The sector’s brutal de-rating since last 4Q has been pricing in a dire growth outlook and it is closer to the end of tunnel in our view.
We expect a lackluster 4Q23 results season for the sector in general but also less share price volatility given extremely depressed valuation. Stay positive over 12-month time horizon.


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 (9988 HK)

Quiddity HSTECH Mar 24 Flow Expectations: US$415mn One-Way if the Low-Conviction Change Takes Place

I see US$415mn one-way index flows assuming Tongcheng Travel (780 HK) gets added and GDS Holdings (9698 HK) gets deleted. However, I see these as...

Janaghan Jeyakumar, CFA

Quiddity HSCEI Mar 24 Flow Expectations: Zhongsheng (881 HK) Downtrend Could Continue

I estimate one-way flow to be US$235mn which translates to a turnover of ~2%. However, these estimates are based on the low-conviction assumption...

Janaghan Jeyakumar, CFA

[Blue Lotus Daily - TMT Update]:JD/BABA/PDD/700 HK/LKNCY

JD increases salaries for customer service staff; Tencent developing mobile game adaptation of "Elden Ring"; Tencent's collaborates with Luckin...

Blue Lotus Research Institute

CaiNiao's FYQ3: Solid Revenue Growth & EBITA Margin Improvement Distinguish It From Express Peers

CaiNiao results from FYQ3 were impressive, with revenue and EBITA margin both up sharply compared to the same period in the previous fiscal year.

Tracking Traffic

China Online Marketplaces: 4Q23 Preview

The sector's brutal de-rating since last 4Q already priced in a dire outlook. While we expect lackluster 4Q results season in general, we believe...

Eric Chen

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Quiddity HSTECH Mar 24 Flow Expectations: US$415mn One-Way if the Low-Conviction Change Takes Place

I see US$415mn one-way index flows assuming Tongcheng Travel (780 HK) gets added and GDS Holdings (9698 HK) gets deleted. However, I see these as...

Janaghan Jeyakumar, CFA

Quiddity HSCEI Mar 24 Flow Expectations: Zhongsheng (881 HK) Downtrend Could Continue

I estimate one-way flow to be US$235mn which translates to a turnover of ~2%. However, these estimates are based on the low-conviction assumption...

Janaghan Jeyakumar, CFA

[Blue Lotus Daily - TMT Update]:JD/BABA/PDD/700 HK/LKNCY

​JD increases salaries for customer service staff; Tencent developing mobile game adaptation of "Elden Ring"; Tencent's collaborates with Luckin...

Blue Lotus Research Institute

CaiNiao's FYQ3: Solid Revenue Growth & EBITA Margin Improvement Distinguish It From Express Peers

CaiNiao results from FYQ3 were impressive, with revenue and EBITA margin both up sharply compared to the same period in the previous fiscal year.

Tracking Traffic

China Online Marketplaces: 4Q23 Preview

The sector's brutal de-rating since last 4Q already priced in a dire outlook. While we expect lackluster 4Q results season in general, we believe...

Eric Chen

JD increases salaries for customer service staff; Tencent developing mobile game adaptation of "Elden Ring"; Tencent's collaborates with Luckin...