External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

Thematic (Sector/Industry)

<div><div><div><div><ul><li>We expect global smartphone market to remain sluggish into 4Q22E, given weak consumer demand, macro uncertainties and lack of major spec upgrade.</li><li>We estimate global/China smartphone market to decline 9%/15% YoY in FY22E. Recent reported data revealed that China smartphone sell-in/sell- through declined 31%/10% YoY in Jul (vs +9%/-8% in Jun), and global smartphone sell-through dropped 16.5% YoY in Jul (vs -16.1% in Jun).</li><li>For 4Q22E, we believe the only bright spot is iPhone supply chain restocking, and we prefer related names such as Luxshare for iPhone/Watch/AirPods OEM, Goertek for share gain in Watch/ AirPods, and FIT Hon Teng/Tongda for iPhone shipment upside. </li></ul></div></div></div></div><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

We expect global smartphone market to remain sluggish into 4Q22E, given weak consumer demand, macro uncertainties and lack of major spec upgrade.We estimate global/China smartphone market to decline 9%/15% YoY in FY22E. Recent reported data revealed that China smartphone sell-in/sell- through declined 31%/10% YoY in Jul (vs +9%/-8% in Jun), and global smartphone sell-through dropped 16.5% YoY in Jul (vs -16.1% in Jun).For 4Q22E, we believe the only bright spot is iPhone supply chain restocking, and we prefer related names such as Luxshare for iPhone/Watch/AirPods OEM, Goertek for share gain in Watch/ AirPods, and FIT Hon Teng/Tongda for iPhone shipment upside. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

China Technology - China Smartphone: No Signs of Recovery in 4Q22E

Equity Bottom-Up

<ul><li>1H22 in-line; Solid smartphone/system products/EV mobility offset networking weakness</li><li>“3+3 Strategy” to bear fruit with strong product pipeline. Mgmt. believed solid growth and margin expansion in 1H22 was a result of successful execution of “3+3 strategy”. </li><li>Attractive risk/reward; Maintain BUY with TP of HK$1.78 (53% upside). Our TP of HK$1.78 is based on 10x FY22E P/E (1-sd below 5-year hist. avg.).</li></ul><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

1H22 in-line; Solid smartphone/system products/EV mobility offset networking weakness“3+3 Strategy” to bear fruit with strong product pipeline. Mgmt. believed solid growth and margin expansion in 1H22 was a result of successful execution of “3+3 strategy”. Attractive risk/reward; Maintain BUY with TP of HK$1.78 (53% upside). Our TP of HK$1.78 is based on 10x FY22E P/E (1-sd below 5-year hist. avg.).Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

FIT Hon Teng (6088 HK) – Strong 1H22 In-Line; Positive Outlook on “3+3 Strategy"

Research on Tech Companies

Evelyn Zhang

<p>USTR requested comments on potential exclusions of products of China subject to tariffs.</p>
<p>The largest exemption categories include Electrical equipment, electronic, mechanical equipment.</p>
<p>The household appliances have over 50% dependence on Chinese imports. </p>
<p>This article combines the four tariff lists and identifies the goods most reliant on China, and consequently, potential beneficiaries of this Sino-US trade relaxation.</p>

USTR requested comments on potential exclusions of products of China subject to tariffs.
The largest exemption categories include Electrical equipment, electronic, mechanical equipment.
The household appliances have over 50% dependence on Chinese imports. 
This article combines the four tariff lists and identifies the goods most reliant on China, and consequently, potential beneficiaries of this Sino-US trade relaxation.

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Event-Driven

<p>The Hang Seng Indexes Company Limited (HSIL) announced the results of its review of the Hang Seng Family of Indexes post market close on 21 May. The constituent changes will be effective after the close of trading on 4 June.</p><p>For the <a href="https://www.smartkarma.com/entities/hang-seng-tech-index" target="_blank" data-smartkarma-citation="entities:31367:1" rel="noopener">Hang Seng Tech Index (HSTECH INDEX)</a>, there are 2 inclusions and 3 exclusions. This brings the number of index constituents back down to 30.</p><p>The inclusions are Autohome (2518 HK) and <a href="https://www.smartkarma.com/entities/bilibili-inc-83a27302-cd7d-4e6a-a1de-bcf93eb022c3" target="_blank" data-smartkarma-citation="entities:32215:1" rel="noopener">Bilibili Inc (9626 HK)</a> while the deletions are <a href="https://www.smartkarma.com/entities/zte-corp-h" target="_blank" data-smartkarma-citation="entities:6922:1" rel="noopener">ZTE Corp H (763 HK)</a>, <a href="https://www.smartkarma.com/entities/fit-hon-teng-ltd" target="_blank" data-smartkarma-citation="entities:22868:1" rel="noopener">Fit Hon Teng (6088 HK)</a> and <a href="https://www.smartkarma.com/entities/archosaur-games" target="_blank" data-smartkarma-citation="entities:28948:1" rel="noopener">Archosaur Games (9990 HK)</a>.</p><p>The inclusion of Autohome (2518 HK) is a surprise and so is the corresponding deletion of <a href="https://www.smartkarma.com/entities/fit-hon-teng-ltd" target="_blank" data-smartkarma-citation="entities:22868:1" rel="noopener">Fit Hon Teng (6088 HK)</a>. With a large impact on both names, these are the ones to watch for. </p><p>One-way turnover is estimated at 5.61% and will result in a one-way trade of HK$1.41bn.</p><p>There are 10 trading days to implementation of the changes. The largest passive flows will go to <a href="https://www.smartkarma.com/entities/bilibili-inc-83a27302-cd7d-4e6a-a1de-bcf93eb022c3" target="_blank" data-smartkarma-citation="entities:32215:1" rel="noopener">Bilibili Inc (9626 HK)</a>, <a href="https://www.smartkarma.com/entities/beijing-kuaishou-technology-co-ltd" target="_blank" data-smartkarma-citation="entities:29725:1" rel="noopener">Kuaishou Technology (1024 HK)</a>, <a href="https://www.smartkarma.com/entities/meituan-dianping" target="_blank" data-smartkarma-citation="entities:26970:1" rel="noopener">Meituan (3690 HK)</a> and <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent (700 HK)</a> while there will be outflows from <a href="https://www.smartkarma.com/entities/xiaomi-corp" target="_blank" data-smartkarma-citation="entities:24409:1" rel="noopener">Xiaomi Corp (1810 HK)</a>, <a href="https://www.smartkarma.com/entities/zte-corp-h" target="_blank" data-smartkarma-citation="entities:6922:1" rel="noopener">ZTE Corp H (763 HK)</a>, <a href="https://www.smartkarma.com/entities/alibaba-group" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba Group (9988 HK)</a> and <a href="https://www.smartkarma.com/entities/jd-health-international-inc" target="_blank" data-smartkarma-citation="entities:29677:1" rel="noopener">JD Health (6618 HK)</a>.</p>

The Hang Seng Indexes Company Limited (HSIL) announced the results of its review of the Hang Seng Family of Indexes post market close on 21 May. The constituent changes will be effective after the close of trading on 4 June.For the Hang Seng Tech Index (HSTECH INDEX), there are 2 inclusions and 3 exclusions. This brings the number of index constituents back down to 30.The inclusions are Autohome (2518 HK) and Bilibili Inc (9626 HK) while the deletions are ZTE Corp H (763 HK), Fit Hon Teng (6088 HK) and Archosaur Games (9990 HK).The inclusion of Autohome (2518 HK) is a surprise and so is the corresponding deletion of Fit Hon Teng (6088 HK). With a large impact on both names, these are the ones to watch for. One-way turnover is estimated at 5.61% and will result in a one-way trade of HK$1.41bn.There are 10 trading days to implementation of the changes. The largest passive flows will go to Bilibili Inc (9626 HK), Kuaishou Technology (1024 HK), Meituan (3690 HK) and Tencent (700 HK) while there will be outflows from Xiaomi Corp (1810 HK), ZTE Corp H (763 HK), Alibaba Group (9988 HK) and JD Health (6618 HK).

HSTECH Index Rebalance: Back to 30 with 2 Adds and 3 Deletes

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

<p>Since inception of our IPO research in 2015, the Aequitas Research team has covered over 361 IPOs, which raised over US$100m each, across Asia Pacific (excluding Korea and China A-shares) and the US (Asia linked listings).</p><p>For this insight, we used data from our IPO framework, the prospectus, company filings and market data to analyse 244 IPOs across Developed and Emerging Asia Pacific (excluding Korea and China A-shares) that took place over 2016-18. Our results are split across two insights.</p><p>In this insight we looked at the country and GICS level IPO performance over 2016-18. We also analysed the variance between the first week and three month performance to decide whether buying orphans is better than sticking to winners. Some of our key findings include:</p><ul><li>Overall IPOs have provided an average 4.8% return at the end of the first week, some geographies like India and Thailand have clearly outperformed with average returns of over 10%.</li><li>IPOs in Hong Kong despite topping the list with the most number of deals, provided only 2.4% average returns.</li><li>In terms of sectors, Financial and Real Estate sectors have been the biggest capital guzzlers in the region. While Healthcare has been the consistent underperformer across geographies over the first few months.</li><li>Incremental returns are higher from holding on to winners than from trying to bet on losers turning around, both in terms of the percentage of such cases and in terms of the average returns overall.</li></ul><p>In our second insight, we’ll analyse the best and worst bookrunners by country, corporate governance impact on listing performance, earnings and liquidity analysis. Our key findings include:</p><ul><li>Some of the biggest names in Investment Banking, one American bank in particular, has by far the lousiest record of providing investor returns from IPOs in this region</li><li>IPOs without any corporate governance issues outperformed the ones with a few issues by 9% on the first day and over the first month. Deals with related party issues and cash/dividend payout prior to listing, performed the worst on average.</li><li>Sales estimates at the time of IPO appear to be a lot more reliable than the net income estimates. The latter has a bias towards being revised downwards much more so than the sales estimates. Target price changes seem to mirror share price movements and were largely out of sync with earnings revisions.</li><li>In terms of volume traded as percentage of shares offered, deals that did well on an average trade 2.5x more than deals that were under water. India had the highest proportion of shares being flipped owing to the high allocation to retail and HNIs while Australia had the lowest liquidity.</li></ul><p>This report has been prepared by the entire Aequitas Research Team:  <a href="https://www.smartkarma.com/profiles/9" target="_blank" data-smartkarma-citation="accounts:9">Ke Yan, CFA, FRM</a>, <a href="https://www.smartkarma.com/profiles/673" target="_blank" data-smartkarma-citation="accounts:673">Zhen Zhou, Toh</a> and  <a href="https://www.smartkarma.com/profiles/4" target="_blank" data-smartkarma-citation="accounts:4">Sumeet Singh</a>.</p>

Since inception of our IPO research in 2015, the Aequitas Research team has covered over 361 IPOs, which raised over US$100m each, across Asia Pacific (excluding Korea and China A-shares) and the US (Asia linked listings).For this insight, we used data from our IPO framework, the prospectus, company filings and market data to analyse 244 IPOs across Developed and Emerging Asia Pacific (excluding Korea and China A-shares) that took place over 2016-18. Our results are split across two insights.In this insight we looked at the country and GICS level IPO performance over 2016-18. We also analysed the variance between the first week and three month performance to decide whether buying orphans is better than sticking to winners. Some of our key findings include:Overall IPOs have provided an average 4.8% return at the end of the first week, some geographies like India and Thailand have clearly outperformed with average returns of over 10%.IPOs in Hong Kong despite topping the list with the most number of deals, provided only 2.4% average returns.In terms of sectors, Financial and Real Estate sectors have been the biggest capital guzzlers in the region. While Healthcare has been the consistent underperformer across geographies over the first few months.Incremental returns are higher from holding on to winners than from trying to bet on losers turning around, both in terms of the percentage of such cases and in terms of the average returns overall.In our second insight, we’ll analyse the best and worst bookrunners by country, corporate governance impact on listing performance, earnings and liquidity analysis. Our key findings include:Some of the biggest names in Investment Banking, one American bank in particular, has by far the lousiest record of providing investor returns from IPOs in this regionIPOs without any corporate governance issues outperformed the ones with a few issues by 9% on the first day and over the first month. Deals with related party issues and cash/dividend payout prior to listing, performed the worst on average.Sales estimates at the time of IPO appear to be a lot more reliable than the net income estimates. The latter has a bias towards being revised downwards much more so than the sales estimates. Target price changes seem to mirror share price movements and were largely out of sync with earnings revisions.In terms of volume traded as percentage of shares offered, deals that did well on an average trade 2.5x more than deals that were under water. India had the highest proportion of shares being flipped owing to the high allocation to retail and HNIs while Australia had the lowest liquidity.This report has been prepared by the entire Aequitas Research Team:  Ke Yan, CFA, FRM, Zhen Zhou, Toh and  Sumeet Singh.

IPO Analytics: Cut Your Losses and Let Your Profits Run, Holds True for IPOs

Taiwan

FIT Hon Teng Limited manufactures and distributes electrical components. The Company produces backplane connectors, memory cards, sockets, terminal blocks, and other products. FIT Hon Teng markets its products throughout Taiwan.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

FIT Hon Teng (6088 HK)

China Technology - China Smartphone: No Signs of Recovery in 4Q22E

We expect global smartphone market to remain sluggish into 4Q22E, given weak consumer demand, macro uncertainties and lack of major spec upgrade.

CMB International