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

JD Health International  / Equity Capital Markets

<div><p><a href="https://www.smartkarma.com/entities/jd-health-international" target="_blank" data-smartkarma-citation="entities:29677:1" rel="noopener">JD Health (6618 HK)</a> is the largest online healthcare platform and the largest online retail pharmacy by revenue in China in 2019, according to Frost &amp; Sullivan. JD Health will commence trading on Tuesday, 8 December. JD Health priced its IPO at HK$70.58 and <a href="http://www.aastocks.com/en/stocks/news/aafn-con/NOW.1061472/ipo-news" target="_blank" rel="noopener">opened 19% higher</a> at HK$84.00 in the grey market and last stood at $89.05, up 26%.</p></div><div>
<p>In <a href="https://www.smartkarma.com/insights/jd-health-ipo-initiation-e-ppointments" target="_blank" data-smartkarma-citation="insights:45106" rel="noopener">JD Health IPO Initiation: E-Ppointments</a>, we opined that JD Health’s fundamentals suggest that it is an attractive play on China’s online healthcare platform industry. In <a href="https://www.smartkarma.com/insights/jd-health-ipo-phip-new-data-points-and-peer-comparison" target="_blank" data-smartkarma-citation="insights:45377" rel="noopener">JD Health IPO: PHIP New Data Points and Peer Comparison</a>, we stated that the new data points disclosed in the PHIP along with our peer analysis reinforce our view that JD Health has attractive fundamentals. In <a href="https://www.smartkarma.com/insights/jd-health-ipo-valuation-insights" target="_blank" data-smartkarma-citation="insights:45703" rel="noopener">JD Health IPO: Valuation Insights</a>, we noted that IPO price range is attractive.</p>
<div class="content-highlight"><p>Our base-case DCF derived price target of HK$78.79 per share. As DCF-based target prices are subject to a wide range of variability, we present a sensitivity table to help investors gauge where target prices could head. Our DCF sensitivity analysis shows that the IPO price continues to provide good upside potential. </p></div>
</div>

JD Health (6618 HK) is the largest online healthcare platform and the largest online retail pharmacy by revenue in China in 2019, according to Frost &amp; Sullivan. JD Health will commence trading on Tuesday, 8 December. JD Health priced its IPO at HK$70.58 and opened 19% higher at HK$84.00 in the grey market and last stood at $89.05, up 26%.
In JD Health IPO Initiation: E-Ppointments, we opined that JD Health’s fundamentals suggest that it is an attractive play on China’s online healthcare platform industry. In JD Health IPO: PHIP New Data Points and Peer Comparison, we stated that the new data points disclosed in the PHIP along with our peer analysis reinforce our view that JD Health has attractive fundamentals. In JD Health IPO: Valuation Insights, we noted that IPO price range is attractive.
Our base-case DCF derived price target of HK$78.79 per share. As DCF-based target prices are subject to a wide range of variability, we present a sensitivity table to help investors gauge where target prices could head. Our DCF sensitivity analysis shows that the IPO price continues to provide good upside potential. 


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.

Equity Bottom-Up

Alibaba Health Information Tec / Equity Bottom-Up

<ul>
<li>The National Radio and Television Administration forbids juveniles from paying broadcasters.</li>
<li>It was widely rumored that both Alibaba (BABA) and Tencent (700 HK) stopped negotiating the acquisition of iQiyi (IQ).</li>
<li>The National Medical Products Administration formally allow prescription drug to be sold online.</li>
</ul>


The National Radio and Television Administration forbids juveniles from paying broadcasters.
It was widely rumored that both Alibaba (BABA) and Tencent (700 HK) stopped negotiating the acquisition of iQiyi (IQ).
The National Medical Products Administration formally allow prescription drug to be sold online.


China Internet Weekly (30Nov2020): Approve Online Rx Drug, Ban Juveniles from Paying Broadcasters

APAC IPOs & Placements

Zhen Zhou, Toh

<p><a href="https://www.smartkarma.com/entities/jd-health-international" target="_blank" data-smartkarma-citation="entities:29677:1" rel="noopener">JD Health (6618 HK)</a> (JDH) is looking to raise up to US$3.47bn in its upcoming Hong Kong IPO </p><p>JDH’s retail pharmacy and online healthcare services form a strong, closed loop, end-to-end healthcare ecosystem that is well-positioned to benefit from the digitalization of China’s healthcare system. It has an extensive network of online and offline pharmacies which is expanding into offering more online healthcare services. Revenue has been strong in the past three years and it has accelerated further due to COVID-19. </p><p>In this note, we will take a look at Ali Health’s 1H FY2020 results and the prospects of fast track/ early inclusion into various indices.</p><div><p>Our previous coverage of the IPO:</p></div><div><ul style="list-style-type: disc;">
<li>
<a href="https://www.smartkarma.com/insights/jd-health-pre-ipo-well-positioned-to-ride-china-s-healthcare-digitalization" target="_blank" data-smartkarma-citation="insights:43711" rel="noopener">JD Health (京东健康) Pre-IPO - Well-Positioned to Ride China’s Healthcare Digitalization</a> </li>
<li>
<a href="https://www.smartkarma.com/insights/jd-health-pre-ipo-peer-comparison-it-s-a-close-fight-and-competition-is-intensifying" target="_blank" data-smartkarma-citation="insights:45062" rel="noopener">JD Health (京东健康) Pre-IPO - Peer Comparison - It's a Close Fight and Competition Is Intensifying</a> </li>
<li>
<a href="https://www.smartkarma.com/insights/jd-health-pre-ipo-assumptions-and-valuations" target="_blank" data-smartkarma-citation="insights:45266" rel="noopener">JD Health (京东健康) Pre-IPO - Assumptions and Valuations</a> </li>
<li>
<a href="https://www.smartkarma.com/insights/jd-health-pre-ipo-updates-from-phip-fine-tuning-forecasts" target="_blank" data-smartkarma-citation="insights:45368" rel="noopener">JD Health (京东健康) Pre-IPO - Updates from PHIP - Fine-Tuning Forecasts</a> </li>
<li>
<a href="https://www.smartkarma.com/insights/jd-health-ipo-paying-to-ride-the-early-innings-of-healthcare-transformation" target="_blank" data-smartkarma-citation="insights:45695" rel="noopener">JD Health (京东健康) IPO - Paying to Ride the Early Innings of Healthcare Transformation</a> </li>
</ul></div>

JD Health (6618 HK) (JDH) is looking to raise up to US$3.47bn in its upcoming Hong Kong IPO JDH’s retail pharmacy and online healthcare services form a strong, closed loop, end-to-end healthcare ecosystem that is well-positioned to benefit from the digitalization of China’s healthcare system. It has an extensive network of online and offline pharmacies which is expanding into offering more online healthcare services. Revenue has been strong in the past three years and it has accelerated further due to COVID-19. In this note, we will take a look at Ali Health’s 1H FY2020 results and the prospects of fast track/ early inclusion into various indices.Our previous coverage of the IPO:

JD Health (京东健康) Pre-IPO - Well-Positioned to Ride China’s Healthcare Digitalization 

JD Health (京东健康) Pre-IPO - Peer Comparison - It's a Close Fight and Competition Is Intensifying 

JD Health (京东健康) Pre-IPO - Assumptions and Valuations 

JD Health (京东健康) Pre-IPO - Updates from PHIP - Fine-Tuning Forecasts 

JD Health (京东健康) IPO - Paying to Ride the Early Innings of Healthcare Transformation 


JD Health (京东健康) IPO - Ali Health 1H Results Read Through and Index Inclusions

Founder

Kemp Dolliver, CFA

Cherrystone Hill Research

<p>Healthcare’s presence in Asian capital markets has increased substantially over the last four years on the heels of substantial investments in private markets (VC/PE). Policy reforms and changes in listing rules, most notably in China, have led to an explosion of market cap creation for the sector as the universe of companies has expanded to include innovative companies, most notably pre-revenue biopharmaceutical companies. At the same time, substantial investments in digital healthcare, fueled by the COVID-19 pandemic, adds a new source of listed companies. This Insight focuses on leading unlisted healthcare companies in China, India, and ASEAN that have raised substantial amounts of capital and appear to be candidates for listing.   </p>

Healthcare’s presence in Asian capital markets has increased substantially over the last four years on the heels of substantial investments in private markets (VC/PE). Policy reforms and changes in listing rules, most notably in China, have led to an explosion of market cap creation for the sector as the universe of companies has expanded to include innovative companies, most notably pre-revenue biopharmaceutical companies. At the same time, substantial investments in digital healthcare, fueled by the COVID-19 pandemic, adds a new source of listed companies. This Insight focuses on leading unlisted healthcare companies in China, India, and ASEAN that have raised substantial amounts of capital and appear to be candidates for listing.   

<div>
<p><a href="https://www.smartkarma.com/entities/jd-health-international" target="_blank" data-smartkarma-citation="entities:29677:1" rel="noopener">JD Health (6618 HK)</a> is the largest online healthcare platform and the largest online retail pharmacy by revenue in China in 2019, according to Frost &amp; Sullivan.</p>
<div><p>At the proposed IPO price range of HK$62.80-70.58 per share, JD Health will have a market cap of $25.3-28.5 billion. At the mid-point of the IPO price range, the total proceeds are HK$25,469 million ($3.3 billion). Six cornerstone investors will subscribe for $1.35 billion worth of the offer shares. The cornerstone investors include GIC, Hillhouse Capital and BlackRock. </p></div>
</div><div><div><div class="content-highlight"><p>In <a href="https://www.smartkarma.com/insights/jd-health-ipo-initiation-e-ppointments" target="_blank" data-smartkarma-citation="insights:45106" rel="noopener">JD Health IPO Initiation: E-Ppointments</a>, we opined that JD Health’s fundamentals suggest that it is an attractive play on China’s online healthcare platform industry. In <a href="https://www.smartkarma.com/insights/jd-health-ipo-phip-new-data-points-and-peer-comparison" target="_blank" data-smartkarma-citation="insights:45377" rel="noopener">JD Health IPO: PHIP New Data Points and Peer Comparison</a>, we stated that the new data points disclosed in the PHIP along with our peer analysis reinforce our view that JD Health has attractive fundamentals. Overall, we would participate in the IPO due to an attractive IPO price range.</p></div></div></div>


JD Health (6618 HK) is the largest online healthcare platform and the largest online retail pharmacy by revenue in China in 2019, according to Frost &amp; Sullivan.
At the proposed IPO price range of HK$62.80-70.58 per share, JD Health will have a market cap of $25.3-28.5 billion. At the mid-point of the IPO price range, the total proceeds are HK$25,469 million ($3.3 billion). Six cornerstone investors will subscribe for $1.35 billion worth of the offer shares. The cornerstone investors include GIC, Hillhouse Capital and BlackRock. 
In JD Health IPO Initiation: E-Ppointments, we opined that JD Health’s fundamentals suggest that it is an attractive play on China’s online healthcare platform industry. In JD Health IPO: PHIP New Data Points and Peer Comparison, we stated that the new data points disclosed in the PHIP along with our peer analysis reinforce our view that JD Health has attractive fundamentals. Overall, we would participate in the IPO due to an attractive IPO price range.

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)

JD Health IPO: Trading Debut

JD Health priced its IPO at HK$70.58 and opened 19% higher at HK$84.00 in the grey market. Our DCF sensitivity analysis shows that the IPO price...

Arun George

China Internet Weekly (30Nov2020): Approve Online Rx Drug, Ban Juveniles from Paying Broadcasters

The authorities forbid juveniles from paying broadcasters. The Medical Administration allows prescription drug to be sold online.

Ming Lu

JD Health (京东健康) IPO - Ali Health 1H Results Read Through and Index Inclusions

JD Health's IPO bookbuild will likely close a day early. In this note, we take a look at Ali Health’s 1H FY2020 results and the prospects of early...

Zhen Zhou, Toh

Asian Healthcare - Coming of Age

This Smartkarma Originals Insight highlights 20 leading unlisted healthcare companies in Asia, mainly in digital healthcare and biopharma, that are...

Kemp Dolliver, CFA

JD Health IPO: Valuation Insights

At the proposed IPO price range of HK$62.80-70.58 per share, JD Health will have a market cap of $25.3-28.5 billion. Overall, we would participate...

Arun George

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