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

Event-Driven

Zhejiang Leapmotor Technologie / Event-Driven

<ul>
<li>We see three new listings as potential inclusions to the HSCI in December. One is already in Stock Connect, one will be added to Stock Connect while one will not.</li>
<li>Given the large market moves, there will be many changes to the HSCI in March 2023. Quite a few stocks could remain in the HSCI but drop out of Connect.</li>
<li>Some of the potential deletions/ Stock Connect drops have large Southbound holdings and some of these positions could be pared back over the next few months.</li>
</ul>


We see three new listings as potential inclusions to the HSCI in December. One is already in Stock Connect, one will be added to Stock Connect while one will not.
Given the large market moves, there will be many changes to the HSCI in March 2023. Quite a few stocks could remain in the HSCI but drop out of Connect.
Some of the potential deletions/ Stock Connect drops have large Southbound holdings and some of these positions could be pared back over the next few months.


HSCI Index Rebalance and Stock Connect: Potential Changes in December & March (There's a Lot!)

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, 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

Legend Biotech Corp / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/legend-biotech-corp" target="_blank" data-smartkarma-citation="entities:28963:1" rel="noopener">Legend Biotech Corp (LEGN US)</a>, a non-wholly owned subsidiary of Hong Kong-listed <a href="https://www.smartkarma.com/entities/genscript-biotech-corp" target="_blank" data-smartkarma-citation="entities:21041:1" rel="noopener">Genscript Biotech (1548 HK)</a>, is planning to raise up to US$250m in its follow-on offering.</li>
<li>The company last raised cash in Dec 2021 in a similar sized deal, which ended up doing very well after a sharp share price correction.</li>
<li>In this note, we will talk about the deal dynamics and  run the deal through our ECM framework.</li>
</ul>



Legend Biotech Corp (LEGN US), a non-wholly owned subsidiary of Hong Kong-listed Genscript Biotech (1548 HK), is planning to raise up to US$250m in its follow-on offering.
The company last raised cash in Dec 2021 in a similar sized deal, which ended up doing very well after a sharp share price correction.
In this note, we will talk about the deal dynamics and  run the deal through our ECM framework.


Legend Biotech Follow-On - A Little Opportunistic. Last Deal Did Well, After a Large Correction

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Bottom-Up

Innovent Biologics Inc / Equity Bottom-Up

<ul>
<li>Innovent is expected to transform from a biotech to a biopharma. From the present point of view, the Company is a better comprehensive choice of certainty, elasticity and safety.  </li>
<li>With high R&amp;D efficiency, strong sales capability, top talent teams, and mindset keeping pace with the times, investors could consider to replace Hengrui with Innovent in the portfolio.  </li>
<li>Innovent’s valuation anchor is HK$40 billion, below which it's undervalued. Its market value could reach about RMB80 billion to RMB120 billion, based on sales of RMB10 billion to RMB15 billion. </li>
</ul>


Innovent is expected to transform from a biotech to a biopharma. From the present point of view, the Company is a better comprehensive choice of certainty, elasticity and safety.  
With high R&amp;D efficiency, strong sales capability, top talent teams, and mindset keeping pace with the times, investors could consider to replace Hengrui with Innovent in the portfolio.  
Innovent’s valuation anchor is HK$40 billion, below which it's undervalued. Its market value could reach about RMB80 billion to RMB120 billion, based on sales of RMB10 billion to RMB15 billion. 


Innovent Biologics Inc (1801.HK) - Innovent Is Not Optional but Necessary in Portfolio

Thematic (Sector/Industry)

<ul>
<li>
<a href="https://www.smartkarma.com/entities/eli-lilly-co" target="_blank" data-smartkarma-citation="entities:19419:1" rel="noopener">Eli Lilly'</a>s development strategy is worth learning from, which explains the investment logic of a lot of “smart money” and can also be used for reference by domestic pharmaceutical companies.</li>
<li>For CGT, before detail policies on how to properly commercialize CGT in China released, CXO with related R&amp;D capabilities could be a better investment option at the current stage.</li>
<li>The overall sleep situation of Chinese people is not optimistic, leading to the rapid development of China's sleep economy. Meanwhile, we also recommend that investors pay attention to sleep quality.</li>
</ul>



Eli Lilly's development strategy is worth learning from, which explains the investment logic of a lot of “smart money” and can also be used for reference by domestic pharmaceutical companies.
For CGT, before detail policies on how to properly commercialize CGT in China released, CXO with related R&amp;D capabilities could be a better investment option at the current stage.
The overall sleep situation of Chinese people is not optimistic, leading to the rapid development of China's sleep economy. Meanwhile, we also recommend that investors pay attention to sleep quality.


China Healthcare Weekly (Mar.25)- Viable Business Model for Pharma, CXO for CGT, China Sleep Economy

Hansoh Pharmaceutical Group  / Equity Bottom-Up

<ul>
<li>We analyzed the key products and pipeline of <a href="https://www.smartkarma.com/entities/hansoh-pharmaceutical-group" target="_blank" data-smartkarma-citation="entities:23675:1" rel="noopener">Hansoh Pharmaceutical (3692 HK)</a>, which are uninspiring.</li>
<li>Investors could trade this stock when its valuation is at very low level or the valuation of entire sector is in upward trend by taking advantage of the positive momentum.</li>
<li>The cooperation with OliX Pharmaceuticals on siRNA could be a highlight, but the question is would you like to bet on it?</li>
</ul>


We analyzed the key products and pipeline of Hansoh Pharmaceutical (3692 HK), which are uninspiring.
Investors could trade this stock when its valuation is at very low level or the valuation of entire sector is in upward trend by taking advantage of the positive momentum.
The cooperation with OliX Pharmaceuticals on siRNA could be a highlight, but the question is would you like to bet on it?


Hansoh Pharmaceutical (3692.HK) - Lackluster Pipeline, so Bet on SiRNA?

China

Ascentage Pharma Group International operates as a clinical-stage biotechnology company. The Company develops novel therapies for cancers, hepatitis B virus, age-related diseases, and more. Ascentage Pharma Group International conducts businesses in China, the United States, and other countries.

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Ascentage Pharma Group Corp (6855 HK)

HSCI Index Rebalance and Stock Connect: Potential Changes in December & March (There's a Lot!)

There could be 3 adds in December while there will be MANY more changes in March. The adds should outnumber the deletes, but there will be many...

Brian Freitas

Legend Biotech Follow-On - A Little Opportunistic. Last Deal Did Well, After a Large Correction

Legend Biotech Corp (LEGN US), a non-wholly owned subsidiary of Hong Kong-listed Genscript Biotech (1548 HK), is planning to raise up to US$250m in...

Sumeet Singh

Innovent Biologics Inc (1801.HK) - Innovent Is Not Optional but Necessary in Portfolio

Innovent would transform from a biotech to biopharma. It is a better comprehensive choice of certainty, elasticity and safety than Hengrui. Its...

Xinyao (Criss) Wang

China Healthcare Weekly (Mar.25)- Viable Business Model for Pharma, CXO for CGT, China Sleep Economy

The strategy of Eli Lilly could be a good reference for domestic pharmaceutical companies.CXO for CGT is a better investment option.The sleep...

Xinyao (Criss) Wang

Hansoh Pharmaceutical (3692.HK) - Lackluster Pipeline, so Bet on SiRNA?

This article mainly analyzed Hansoh Pharmaceutical in terms of the business, the key products, the pipeline, the concerns, the insights on...

Xinyao (Criss) Wang

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