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

AirPower Technologies / Equity Capital Markets

<ul>
<li>AirPower Technologies (1679085D HK) is looking to raise US$1bn in its upcoming Hong Kong IPO.</li>
<li>Airpower Technologies is an industrial gases solution provider with a nationwide footprint in China. </li>
<li>In this note, we will talk about the company's past performance.</li>
</ul>


AirPower Technologies (1679085D HK) is looking to raise US$1bn in its upcoming Hong Kong IPO.
Airpower Technologies is an industrial gases solution provider with a nationwide footprint in China. 
In this note, we will talk about the company's past performance.


Airpower Technologies Pre-IPO - Steady Topline Growth but Lacks Pricing Power

HK/China Equity Long-Short

Osbert Tang, CFA

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/china-gas-holdings-ltd" target="_blank" data-smartkarma-citation="entities:14315:1" rel="noopener">China Gas Holdings (384 HK)</a> posted weak 1H FY22 result with a 18.6% contraction in core profit, driven primarily by lower new connections and weaker dollar margin for gas sales. </li>
<li>Full-Year guidance on new connections has revised to 3m (vs. 5m) and dollar margin will further contract by HK$0.04-0.06/cu.m. in 2H FY22. Progress on LPG Smart MicroGrid has slowed. </li>
<li>The Shiyan gas explosion looks to have a more long-lasting effect than expected. Also, the need to divert management attention to safety enforcement also weighed on China Gas.</li>
</ul>



China Gas Holdings (384 HK) posted weak 1H FY22 result with a 18.6% contraction in core profit, driven primarily by lower new connections and weaker dollar margin for gas sales. 
Full-Year guidance on new connections has revised to 3m (vs. 5m) and dollar margin will further contract by HK$0.04-0.06/cu.m. in 2H FY22. Progress on LPG Smart MicroGrid has slowed. 
The Shiyan gas explosion looks to have a more long-lasting effect than expected. Also, the need to divert management attention to safety enforcement also weighed on China Gas.


China Gas Holdings (384 HK): Post-Result Call Takeaways, Looks like Not yet Reached the Bottom

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

The last time I wrote about <a href="https://www.smartkarma.com/entities/kunlun-energy-co-ltd" target="_blank" data-smartkarma-citation="entities:10054:1" rel="noopener">Kunlun Energy (135 HK)</a> was in early June 2021 when I discussed the little extra trick one might use to maximise dividend payout. It worked. But I was bullish.At that time, my conclusion was...<blockquote>I am still VERY bullish on Kunlun Energy vs a basket of the three listed HK peers, and at this point, a dollar-neutral position is probably appropriate. </blockquote>The stock was a little wishy-washy the day the Special Dividend went ex- - for whatever reason I do not know - then rallied sharply but since 4 June, though the stock itself rallied 30% from that post ex-div rally to early September, the sharp rise in gas input costs caused the shares to fall back to their post-div rally point last week. However the stock has continued to outperform peers - outperforming a basket of three liquid HK-listed city gas peers by 37.9% since I last wrote (the dots). <section class="figure"><section class="figure"><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/237/339/original/Screenshot+2021-10-25+at+6.55.32+PM.png?1635159349" class="editor-image img-responsive" data-smartkarma-image-id="237339"></figure></section>But despite that performance... </section>I am still VERY bullish on Kunlun Energy vs a basket of the three listed HK peers, and at this point, EITHER a dollar-neutral position OR an outright long is appropriate. More below the fold.

The last time I wrote about Kunlun Energy (135 HK) was in early June 2021 when I discussed the little extra trick one might use to maximise dividend payout. It worked. But I was bullish.At that time, my conclusion was...I am still VERY bullish on Kunlun Energy vs a basket of the three listed HK peers, and at this point, a dollar-neutral position is probably appropriate. The stock was a little wishy-washy the day the Special Dividend went ex- - for whatever reason I do not know - then rallied sharply but since 4 June, though the stock itself rallied 30% from that post ex-div rally to early September, the sharp rise in gas input costs caused the shares to fall back to their post-div rally point last week. However the stock has continued to outperform peers - outperforming a basket of three liquid HK-listed city gas peers by 37.9% since I last wrote (the dots). But despite that performance... I am still VERY bullish on Kunlun Energy vs a basket of the three listed HK peers, and at this point, EITHER a dollar-neutral position OR an outright long is appropriate. More below the fold. 

Kunlun Energy - People Still Don't Get It So Gas It Up Some More

We touched base with <a href="https://www.smartkarma.com/entities/kunlun-energy-co-ltd" target="_blank" data-smartkarma-citation="entities:10054:1" rel="noopener">Kunlun Energy (135 HK)</a> to seek answers on five questions that we think are of significant interests to investors. These include topics on the impact of the rally in LNG price, mechanism for retail gas price adjustment, outlook for dollar margin, impact on the terminal and processing segment, gas volume availability and the future of the E&amp;P segment. These questions are all well answered by Kunlun's management.Overall, based on our discussions, the impact of higher LNG price on Kunlun's profitability and dollar margin should be manageable. It has secured enough gas sources and there should not be worries on shortage. We also anticipate the earnings volatility caused by the upstream E&amp;P business will be sharply lower in two to three years' time; and with better earnings stability and quality, Kunlun should continue to see re-rating.

We touched base with Kunlun Energy (135 HK) to seek answers on five questions that we think are of significant interests to investors. These include topics on the impact of the rally in LNG price, mechanism for retail gas price adjustment, outlook for dollar margin, impact on the terminal and processing segment, gas volume availability and the future of the E&amp;P segment. These questions are all well answered by Kunlun's management.Overall, based on our discussions, the impact of higher LNG price on Kunlun's profitability and dollar margin should be manageable. It has secured enough gas sources and there should not be worries on shortage. We also anticipate the earnings volatility caused by the upstream E&amp;P business will be sharply lower in two to three years' time; and with better earnings stability and quality, Kunlun should continue to see re-rating.

Kunlun Energy (135 HK): Five Questions to Management Get Answered

<a href="https://www.smartkarma.com/entities/kunlun-energy-co-ltd" target="_blank" data-smartkarma-citation="entities:10054:1" rel="noopener">Kunlun Energy (135 HK)</a> disclosed that it has reached agreement to dispose of its 25% stake in the K&amp;K oilfields in Azerbaijan. Although the transaction is relatively small given that it does not pass the 5% threshold of the listing rule, we still think such a small move has big positive meaning. In our view, the disposal marks an important step in its plan to exit the volatile Exploration &amp; Production segment which dragged on its valuation; and the market should welcome this.The current high oil price environment is good for Kunlun from both an operational and a transactional point of view. We estimate that at crude oil price of US$75/bbl, the E&amp;P segment may bring in an addition of at least Rmb300-400m of pre-tax profit in 2H21. Despite the good share price movement YTD (+73% including dividends), it is still trading on just 11x PER for FY21, the cheapest among its key peers. The removal of a volatile E&amp;P segment from its business portfolio should narrow Kunlun's discount, in our view.

Kunlun Energy (135 HK) disclosed that it has reached agreement to dispose of its 25% stake in the K&amp;K oilfields in Azerbaijan. Although the transaction is relatively small given that it does not pass the 5% threshold of the listing rule, we still think such a small move has big positive meaning. In our view, the disposal marks an important step in its plan to exit the volatile Exploration &amp; Production segment which dragged on its valuation; and the market should welcome this.The current high oil price environment is good for Kunlun from both an operational and a transactional point of view. We estimate that at crude oil price of US$75/bbl, the E&amp;P segment may bring in an addition of at least Rmb300-400m of pre-tax profit in 2H21. Despite the good share price movement YTD (+73% including dividends), it is still trading on just 11x PER for FY21, the cheapest among its key peers. The removal of a volatile E&amp;P segment from its business portfolio should narrow Kunlun's discount, in our view. 

Kunlun Energy (135 HK): Small Move, Big Meaning

Hong Kong

China Resources Gas Group Ltd distributes natural gas and petroleum gas in the cities of Chengdu, Fuyang, Huaibei, Linhai, Suzhou and Wuxi in the PRC. The Company also operates compressed natural gas filling stations in Chengdu, Nanjing and Wuxi. The group also is involved in bottled liquefied petroleum gas distribution in cities of Fuyang, Suzhou and Wuxi.

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CR Gas (1193 HK)

Airpower Technologies Pre-IPO - Steady Topline Growth but Lacks Pricing Power

AirPower Technologies (1679085D HK) is looking to raise US$1bn in its upcoming Hong Kong IPO. In this note, we look at the company's past performance.

Sumeet Singh

China Gas Holdings (384 HK): Post-Result Call Takeaways, Looks like Not yet Reached the Bottom

Weaker-than-expected result for 1H FY22 is negative and management turned more cautious on outlook for 2H FY22, pointing to lower new connections...

Osbert Tang, CFA

Kunlun Energy - People Still Don't Get It So Gas It Up Some More

There are a few ways to look at Kunlun Energy vs Peers. Traditional measures show Kunlun as dreadfully cheap vs peers. The traditional measures are...

Travis Lundy

Kunlun Energy (135 HK): Five Questions to Management Get Answered

The impact of higher LNG price on the dollar margin and profitability of Kunlun's city gas projects should be manageable. Earnings volatility from...

Osbert Tang, CFA

Kunlun Energy (135 HK): Small Move, Big Meaning

The disposal of the Azerbaijan oilfields, though a small transaction, has significant implication. Kunlun will increasingly become a pure gas...

Osbert Tang, CFA

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