Equity Analyst, LightStream Research

Shifara Samsudeen, ACMA, CGMA

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

Sipai Health Technology / Equity Bottom-Up

<ul>
<li>Sipai Health Tech’s shares have been up more than 35% since its HKEx IPO in December 2022. Shares were priced at HK$18.6 a piece and are trading close to HK$33.55.</li>
<li>The company’s largest business segment commands very lower margins while high-margin insurance business is facing stiff competition with negligible contribution to consolidated earnings.</li>
<li>Closest peer Beijing Yuanxin Tech has applied for an IPO and Yuanxin’s deteriorating performance could have partly driven the current rally in Sipai’s share price since its IPO.</li>
</ul>


Sipai Health Tech’s shares have been up more than 35% since its HKEx IPO in December 2022. Shares were priced at HK$18.6 a piece and are trading close to HK$33.55.
The company’s largest business segment commands very lower margins while high-margin insurance business is facing stiff competition with negligible contribution to consolidated earnings.
Closest peer Beijing Yuanxin Tech has applied for an IPO and Yuanxin’s deteriorating performance could have partly driven the current rally in Sipai’s share price since its IPO.


Sipai Health Tech: Market Overreacts to a Mediocre Business

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

<ul>
<li>The sustainability/stability of Sipai’s performance and growth potential are worrying. Sipai doesn’t have a business with core competitiveness as its foundation, thus leading to potential problems in its business model.</li>
<li>It is useless to have fast revenue growth because Sipai’s profitability is very weak, which is actually closely related to its business characteristics. Sipai is far from being breakeven.</li>
<li>Sipai is overvalued. Such high valuation is not reasonable based on our analysis. We are conservative about Sipai's outlook and we think there are much better investment opportunities.</li>
</ul>


The sustainability/stability of Sipai’s performance and growth potential are worrying. Sipai doesn’t have a business with core competitiveness as its foundation, thus leading to potential problems in its business model.
It is useless to have fast revenue growth because Sipai’s profitability is very weak, which is actually closely related to its business characteristics. Sipai is far from being breakeven.
Sipai is overvalued. Such high valuation is not reasonable based on our analysis. We are conservative about Sipai's outlook and we think there are much better investment opportunities.


Sipai Health Technology (314.HK) - Unjustified Valuation and Problematic Business Model

JD Health International  / Equity Bottom-Up

<ul>
<li>JD Health reported 2H2022 results. 2H revenue increased 55.5% YoY to RMB26.5bn (RMB24.2bn) while fall in GPM and an increase in fulfilment costs led to operating losses during the period.</li>
<li>Product revenues (JD Pharmacy) continues to account for a majority of JD Health’s revenues that generate lower GPM compared to Marketplace and other revenues.</li>
<li>JD Health’s share price has moved up over the last few months but further decline in GPM  could pull the share price down suggesting it could be a Good Short.</li>
</ul>


JD Health reported 2H2022 results. 2H revenue increased 55.5% YoY to RMB26.5bn (RMB24.2bn) while fall in GPM and an increase in fulfilment costs led to operating losses during the period.
Product revenues (JD Pharmacy) continues to account for a majority of JD Health’s revenues that generate lower GPM compared to Marketplace and other revenues.
JD Health’s share price has moved up over the last few months but further decline in GPM  could pull the share price down suggesting it could be a Good Short.


JD Health: Lower Margin Direct Sales Biz Weighs Down Profitability

APAC IPOs & Placements, Aequitas Research

Ethan Aw

APAC IPOs & Placements

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.

Equity Capital Markets

Survival Technologies / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/survival-technologies" target="_blank" data-smartkarma-citation="entities:36720:1" rel="noopener">Survival Technologies (1279515D IN)</a> is looking to raise around US$121m in its upcoming India IPO. </li>
<li>Survival Technologies (ST) is a contract research and manufacturing services (CRAMS) focused speciality chemical manufacturer in India. </li>
<li>ST has seen its profitability grow and margins expand during the track record period. However, the company seems to have had a number of run-ins with the authorities.</li>
</ul>



Survival Technologies (1279515D IN) is looking to raise around US$121m in its upcoming India IPO. 
Survival Technologies (ST) is a contract research and manufacturing services (CRAMS) focused speciality chemical manufacturer in India. 
ST has seen its profitability grow and margins expand during the track record period. However, the company seems to have had a number of run-ins with the authorities.


Survival Technologies Pre-IPO - Growth Has Been Strong but Could Be Better

Ping An Healthcare and Technology / Equity Bottom-Up

<ul>
<li>PAGD intends to switch from 2C model to 2B model and to reduce losses ASAP at the expense of revenue scale, so as to prove its profitability to the market. </li>
<li>B-End corporate customers with high quality and sufficient budget are limited. Once the growth of B-end corporate customers meets a bottleneck, its performance may face another decline.</li>
<li>Despite the improving financial performance in 2022, we still think that we need to further observe the effect of strategic transformation and future performance of PAGD before making judgments.</li>
</ul>


PAGD intends to switch from 2C model to 2B model and to reduce losses ASAP at the expense of revenue scale, so as to prove its profitability to the market. 
B-End corporate customers with high quality and sufficient budget are limited. Once the growth of B-end corporate customers meets a bottleneck, its performance may face another decline.
Despite the improving financial performance in 2022, we still think that we need to further observe the effect of strategic transformation and future performance of PAGD before making judgments.


Ping An Healthcare and Technology Company Limited (1833.HK)- To Turn Things Around or to Fail Again?

China

Alibaba Health Information Technology Limited is an integrated healthcare information and content service provider. The Company uses product identification, authentication, and tracking system data for its healthcare information.

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Alibaba Health Information Tec (241 HK)

Sipai Health Tech: Market Overreacts to a Mediocre Business

Sipai's shares have rallied more than 35% since its IPO. Largest biz segment commands very lower GPM and high-margin insurance biz's contribution...

Shifara Samsudeen, ACMA, CGMA

Sipai Health Technology (314.HK) - Unjustified Valuation and Problematic Business Model

The sustainability/stability of Sipai’s performance/growth potential is worrying. Weak profitability make Sipai hard to be breakeven.High valuation...

Xinyao (Criss) Wang

JD Health: Lower Margin Direct Sales Biz Weighs Down Profitability

JDH's GPM has been on a declining trend due to lower margin direct sales biz . Online marketplace and healthcare services are key driver of...

Shifara Samsudeen, ACMA, CGMA

Survival Technologies Pre-IPO - Growth Has Been Strong but Could Be Better

Survival Technologies (1279515D IN) is looking to raise around US$121m in its upcoming India IPO. It has seen its profitability grow and margins...

Ethan Aw

Ping An Healthcare and Technology Company Limited (1833.HK)- To Turn Things Around or to Fail Again?

PAGD's intention to improve profitability at the expense of revenue scale is obvious. Switching from 2C to 2B model is a double-edged sword....

Xinyao (Criss) Wang

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