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.

Event-Driven

Several news media outlets reported on Thursday (08th April 2021) that the Chinese mobile games and Video streaming platform <a href="https://www.smartkarma.com/entities/bilibili-inc" target="_blank" data-smartkarma-citation="entities:26793:1" rel="noopener">Bilibili Inc (BILI US)</a> is in talks to buy a 24% stake in Yoozoo Games.Yoozoo Games based in China is engaged in the development, distribution, publishing and operation of mobile games and internet games.In addition to acquiring a 24% stake in Yoozoo Games, Bilibili is said to be in talks to acquire Yoozoo’s headquarters building in Shanghai and also take over nearly RMB700m in debt that is left by the company’s late founder.A majority of Bilibili’s users are aged below 35 years and the company aims to make use of these young users to tap into the video games market. Bilibili itself offers mobile games that accounted for about 29% of total revenues in 4Q2020. Mobile games used to account for a majority of the company’s revenues, however, with strong growth in revenue from value-added services, the segment’s revenue contribution has declined to about 30%.

Several news media outlets reported on Thursday (08th April 2021) that the Chinese mobile games and Video streaming platform Bilibili Inc (BILI US) is in talks to buy a 24% stake in Yoozoo Games.Yoozoo Games based in China is engaged in the development, distribution, publishing and operation of mobile games and internet games.In addition to acquiring a 24% stake in Yoozoo Games, Bilibili is said to be in talks to acquire Yoozoo’s headquarters building in Shanghai and also take over nearly RMB700m in debt that is left by the company’s late founder.A majority of Bilibili’s users are aged below 35 years and the company aims to make use of these young users to tap into the video games market. Bilibili itself offers mobile games that accounted for about 29% of total revenues in 4Q2020. Mobile games used to account for a majority of the company’s revenues, however, with strong growth in revenue from value-added services, the segment’s revenue contribution has declined to about 30%.

Bilibili in Talks to Buy 24% Stake in Yoozoo Games to Enhance and Strengthen Content Offerings

Research on Tech Companies

Evelyn Zhang

Thematic (Sector/Industry)

The recent fall in price of many so called “China concept shares” of US listed Chinese companies, has largely been triggered by the passing of the "Holding Foreign Company Accountability Act" (HFCAA).A flock of US listed Chinese companies have since decided to relist in HKSE due to a few reasons:<ol>
<li>The HFCAA causing conflicting compliance requirements with Chinese regulations.</li>
<li>Fear among investors of forced delisting in the US.</li>
<li>HKEX deregulation allowing more Chinese companies to be listed.</li>
<li>The valuation in HK is in sync with the U.S. stock market.</li>
<li>HK attracting more Chinese funds to operate in HKEX.</li>
</ol>

The recent fall in price of many so called “China concept shares” of US listed Chinese companies, has largely been triggered by the passing of the "Holding Foreign Company Accountability Act" (HFCAA).A flock of US listed Chinese companies have since decided to relist in HKSE due to a few reasons:
The HFCAA causing conflicting compliance requirements with Chinese regulations.
Fear among investors of forced delisting in the US.
HKEX deregulation allowing more Chinese companies to be listed.
The valuation in HK is in sync with the U.S. stock market.
HK attracting more Chinese funds to operate in HKEX.


Exit the Dragon – the Mass Exodus of US Listed Chinese Companies

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

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Trip.com plans to raise around US$1.2bn in its secondary listing in Hong Kong. We have looked at the background of the deal in our earlier note, <a href="https://www.smartkarma.com/insights/trip-com-secondary-listing-probably-needs-to-correct" target="_blank" rel="noopener">Trip.com Secondary Listing - Probably Needs to Correct</a>.
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<div>
In this note, we’ll take a look at the final deal terms and talk about the impact of the raising.
</div>


Trip.com plans to raise around US$1.2bn in its secondary listing in Hong Kong. We have looked at the background of the deal in our earlier note, Trip.com Secondary Listing - Probably Needs to Correct.


In this note, we’ll take a look at the final deal terms and talk about the impact of the raising.


Trip.com Secondary Listing Quick Take - Doing the Bare Minimum - Needs Some More Correction

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.

<a href="https://www.smartkarma.com/entities/trip-com-group-ltd" target="_blank" data-smartkarma-citation="entities:180:1" rel="noopener">Trip.com (TCOM US)</a> is a leading one-stop travel platform that currently operates through four leading travel brands which are Ctrip, Qunar, Trip.com and Skyscanner. Trip.com passed its Hong Kong listing committee hearing and could raise up to $1-2 billion through a secondary listing, according to press reports. Trip.com is braving choppy markets and waning investor enthusiasm on secondary listings/IPOs. The recent Hong Kong secondary listings of <a href="https://www.smartkarma.com/entities/autohome-inc-adr" target="_blank" data-smartkarma-citation="entities:20234:1" rel="noopener">Autohome Inc (Adr) (ATHM US)</a> and <a href="https://www.smartkarma.com/entities/bilibili-inc" target="_blank" data-smartkarma-citation="entities:26793:1" rel="noopener">Bilibili Inc (BILI US)</a> are trading 3% and 8% above their H-share listing price, respectively. <a href="https://www.smartkarma.com/entities/baidu-inc" target="_blank" data-smartkarma-citation="entities:179:1" rel="noopener">Baidu (BIDU US)</a> is trading -13% below its H-share listing price largely due to the fallout from the fire sale at Archegos Capital.   <div class="content-highlight">Trip.com is a play on the expected reopening and recovery of travel in 2021 due to the global rollout of vaccines. In the post-pandemic world, Trip.com aims to cement its market share gains through strengthening its supply chain (such as short-distance travel), higher conversion via content investment (such as live streaming) and rising penetration in lower-tier cities (&gt;40% of new mobile app users in 2020 were from lower-tier cities). We think that Trip.com is an attractive play on travel recovery at the last close price. </div>

Trip.com (TCOM US) is a leading one-stop travel platform that currently operates through four leading travel brands which are Ctrip, Qunar, Trip.com and Skyscanner. Trip.com passed its Hong Kong listing committee hearing and could raise up to $1-2 billion through a secondary listing, according to press reports. Trip.com is braving choppy markets and waning investor enthusiasm on secondary listings/IPOs. The recent Hong Kong secondary listings of Autohome Inc (Adr) (ATHM US) and Bilibili Inc (BILI US) are trading 3% and 8% above their H-share listing price, respectively. Baidu (BIDU US) is trading -13% below its H-share listing price largely due to the fallout from the fire sale at Archegos Capital.   Trip.com is a play on the expected reopening and recovery of travel in 2021 due to the global rollout of vaccines. In the post-pandemic world, Trip.com aims to cement its market share gains through strengthening its supply chain (such as short-distance travel), higher conversion via content investment (such as live streaming) and rising penetration in lower-tier cities (&gt;40% of new mobile app users in 2020 were from lower-tier cities). We think that Trip.com is an attractive play on travel recovery at the last close price. 

Trip.com Secondary Listing: No Heads in the Clouds

Equity Bottom-Up

<a href="https://www.smartkarma.com/entities/tencent-music-entertainment" target="_blank" data-smartkarma-citation="entities:27255:1" rel="noopener">Tencent Music (TME US)</a>  announced on Sunday (28th March 2021) that its board of directors has authorised a share repurchase program to buyback US$1bn of its Class A ordinary shares in the form of American Depository Shares (ADS).In our previous insights on TME, we discussed the company’s business model, segments, financials and valuation. Read our previous insights:<a href="https://www.smartkarma.com/insights/tme-secondary-listing-monetisation-efforts-in-social-entertainment-should-boost-top-line-growth" target="_blank" data-smartkarma-citation="insights:48830" rel="noopener">TME Secondary Listing: Monetisation Efforts in Social Entertainment Should Boost Top Line Growth</a> <a href="https://www.smartkarma.com/insights/tencent-music-secondary-unlikely-for-margins-to-expand-but-should-remain-stable-at-current-level" target="_blank" data-smartkarma-citation="insights:49034" rel="noopener">Tencent Music Secondary: Unlikely for Margins to Expand but Should Remain Stable at Current Level</a> <a href="https://www.smartkarma.com/insights/tme-4q-results-strong-finish-to-2020-further-strengthens-partnerships-and-focus-on-new-initiatives" target="_blank" data-smartkarma-citation="insights:49558" rel="noopener">TME 4Q Results: Strong Finish to 2020, Further Strengthens Partnerships and Focus on New Initiatives</a>

Tencent Music (TME US)  announced on Sunday (28th March 2021) that its board of directors has authorised a share repurchase program to buyback US$1bn of its Class A ordinary shares in the form of American Depository Shares (ADS).In our previous insights on TME, we discussed the company’s business model, segments, financials and valuation. Read our previous insights:TME Secondary Listing: Monetisation Efforts in Social Entertainment Should Boost Top Line Growth Tencent Music Secondary: Unlikely for Margins to Expand but Should Remain Stable at Current Level TME 4Q Results: Strong Finish to 2020, Further Strengthens Partnerships and Focus on New Initiatives 

Tencent Music Announces US$1bn Buyback After Shares Dip Double-Digit

China

Bilibili Inc. provides online entertainment services. The Company offers a platform that covers a wide array of genres and media formats, including videos, live broadcasting, mobile games, animation, and comics. Bilibili serves customers in China.

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Bilibili (BILI US)

Bilibili in Talks to Buy 24% Stake in Yoozoo Games to Enhance and Strengthen Content Offerings

We believe the stake acquisition of Yoozoo will strengthen Bilibili’s mobile games content which should help the company expand its paid user base.

Shifara Samsudeen, ACMA, CGMA

Exit the Dragon – the Mass Exodus of US Listed Chinese Companies

Is US-China financial decoupling affecting the US stock market? What's the future of US listed Chinese companies l? How can investors in China...

Evelyn Zhang

Trip.com Secondary Listing Quick Take - Doing the Bare Minimum - Needs Some More Correction

Trip.com plans to raise around US$1.2bn in its secondary listing in Hong Kong. In this note, we’ll take a look at the final deal terms and talk...

Sumeet Singh

Trip.com Secondary Listing: No Heads in the Clouds

Trip.com passed its HKEx listing hearing to raise up to $1-2bn through a secondary listing. We think that Trip.com is an attractive play on travel...

Arun George

Tencent Music Announces US$1bn Buyback After Shares Dip Double-Digit

We would recommend making an entry at the current multiple as we believe the announced buyback will likely help share price to move up in the short...

Shifara Samsudeen, ACMA, CGMA

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