Asia Pac IPO & Placement Research, China biotech, Aequitas Research

Ke Yan, CFA, FRM

Asia Pac IPO & Placement Research, China biotech

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.

Quantitative Analysis

In our Discover SZ/SH Connect series, we aim to help our investors understand the flow of northbound trades via the Shanghai Connect and Shenzhen Connect, as analyzed by our proprietary data engine. We will discuss the stocks that experienced the most inflow and outflow by offshore investors in the past seven days.We split the stocks eligible for the northbound trade into three groups: those with a market capitalization of above USD 5 billion, and those with a market capitalization between USD 1 billion and USD 5 billion.We note that offshore investors were buying all GICS sectors, and had a strong preference for Consumer Staples, Financials and Consumer Discretionary names. We estimate that total inflow into A-share market via northbound trade amounted to USD 8.5 bn in January.Stocks with strong inflows (by quantum) were <a href="https://www.smartkarma.com/entities/1553" target="_blank" data-smartkarma-citation="entities:1553:1">Kweichow Moutai Co Ltd A (600519 CH)</a>, <a href="https://www.smartkarma.com/entities/7622" target="_blank" data-smartkarma-citation="entities:7622:1">Gree Electric Appliances Inc Of Zhuhai (000651 CH)</a>, and <a href="https://www.smartkarma.com/entities/16185" target="_blank" data-smartkarma-citation="entities:16185:1">Midea Group Co Ltd A (000333 CH)</a>. Please read this note together with <a href="https://www.smartkarma.com/insights/discover-sz-sh-connect-foreigners-were-buying-industries-and-financials-in-december" target="_blank">our coverage for December flow</a> and our coverage for <a href="https://www.smartkarma.com/insights/hk-connect-discovery-january-snapshot" target="_blank">January northbound flow</a>.

In our Discover SZ/SH Connect series, we aim to help our investors understand the flow of northbound trades via the Shanghai Connect and Shenzhen Connect, as analyzed by our proprietary data engine. We will discuss the stocks that experienced the most inflow and outflow by offshore investors in the past seven days.We split the stocks eligible for the northbound trade into three groups: those with a market capitalization of above USD 5 billion, and those with a market capitalization between USD 1 billion and USD 5 billion.We note that offshore investors were buying all GICS sectors, and had a strong preference for Consumer Staples, Financials and Consumer Discretionary names. We estimate that total inflow into A-share market via northbound trade amounted to USD 8.5 bn in January.Stocks with strong inflows (by quantum) were Kweichow Moutai Co Ltd A (600519 CH), Gree Electric Appliances Inc Of Zhuhai (000651 CH), and Midea Group Co Ltd A (000333 CH). Please read this note together with our coverage for December flow and our coverage for January northbound flow. 

Shanghai/Shenzhen Connect - $8.5 Bn of Inflow in January (Kweichow Moutai, Gree, Midea)

Quantamental Researcher, JD Finance Quantamental Research

Ben Li

Quantamental Researcher

JD Finance Quantamental Research

JD Finance Big Data Quantamental Research is a data and insight provider of proprietary online eCommerce data, under the arm of big data analytics team in JD Finance. JD Finance is an affiliate of US listed JD, a leading eCommerce player in China. It is one of the largest fintech companies in China, with business spanning across consumer loans, fund distribution, and quantitative strategy research. 

Thematic (Sector/Industry)

<ul>
<li>Online sales of the overall home appliance sector during the "6.18" promotional event went up by 37% vs 2017.</li>
<li>Premiumization prevails among key major home appliance categories with the exception of flat-panel TV and water heater; trading up can also be found within most small kitchen appliance categories.</li>
<li>Vacuum cleaner and robot vacuum are the growth drivers in small home appliance sector, while sales of air purifier declined vs year ago.</li>
</ul>
Related Tickers: <a href="https://www.smartkarma.com/entities/7622" target="_blank" data-smartkarma-citation="entities:7622:1">Gree Electric Appliances Inc Of Zhuhai (000651 CH)</a>, <a href="https://www.smartkarma.com/entities/16185" target="_blank" data-smartkarma-citation="entities:16185:1">Midea Group Co Ltd A (000333 CH)</a>,  <a href="https://www.smartkarma.com/entities/20107" target="_blank" data-smartkarma-citation="entities:20107:1">Hisense Kelon Elec Hld H (921 HK)</a>, <a href="https://www.smartkarma.com/entities/7196" target="_blank" data-smartkarma-citation="entities:7196:1">Qingdao Haier Co Ltd A (600690 CH)</a>, <a href="https://www.smartkarma.com/entities/13735" target="_blank" data-smartkarma-citation="entities:13735:1">Skyworth Digital Co Ltd A (000810 CH)</a>, <a href="https://www.smartkarma.com/entities/15654" target="_blank" data-smartkarma-citation="entities:15654:1">TCL Multimedia Technology (1070 HK)</a>, <a href="https://www.smartkarma.com/entities/17702" target="_blank" data-smartkarma-citation="entities:17702:1">Sichuan Changhong Electric Co., Ltd. (600839 CH)</a>, <a href="https://www.smartkarma.com/entities/10371" target="_blank" data-smartkarma-citation="entities:10371:1">Hangzhou Robam Appliances A (002508 CH)</a>, <a href="https://www.smartkarma.com/entities/8754" target="_blank" data-smartkarma-citation="entities:8754:1">Vatti Corporation Ltd A (002035 CH)</a>, <a href="https://www.smartkarma.com/entities/18645" target="_blank" data-smartkarma-citation="entities:18645:1">Smith (A.O.) Corp (AOS US)</a>, <a href="https://www.smartkarma.com/entities/1303" target="_blank" data-smartkarma-citation="entities:1303:1">Rinnai Corp (5947 JP)</a>, <a href="https://www.smartkarma.com/entities/12267" target="_blank" data-smartkarma-citation="entities:12267:1">Zhejiang Supor Co Ltd (002032 CH)</a>, <a href="https://www.smartkarma.com/entities/3332" target="_blank" data-smartkarma-citation="entities:3332:1">Joyoung Co Ltd A (002242 CH)</a>, <a href="https://www.smartkarma.com/entities/24832" target="_blank" data-smartkarma-citation="entities:24832:1">KingClean Electric Co Ltd (603355 CH)</a>, <a href="https://www.smartkarma.com/entities/27196" target="_blank" data-smartkarma-citation="entities:27196:1">Ecovacs Robotics Co Ltd (603486 CH)</a>
Please feel free to contact us for specific data requests.


Online sales of the overall home appliance sector during the "6.18" promotional event went up by 37% vs 2017.
Premiumization prevails among key major home appliance categories with the exception of flat-panel TV and water heater; trading up can also be found within most small kitchen appliance categories.
Vacuum cleaner and robot vacuum are the growth drivers in small home appliance sector, while sales of air purifier declined vs year ago.

Related Tickers: Gree Electric Appliances Inc Of Zhuhai (000651 CH), Midea Group Co Ltd A (000333 CH),  Hisense Kelon Elec Hld H (921 HK), Qingdao Haier Co Ltd A (600690 CH), Skyworth Digital Co Ltd A (000810 CH), TCL Multimedia Technology (1070 HK), Sichuan Changhong Electric Co., Ltd. (600839 CH), Hangzhou Robam Appliances A (002508 CH), Vatti Corporation Ltd A (002035 CH), Smith (A.O.) Corp (AOS US), Rinnai Corp (5947 JP), Zhejiang Supor Co Ltd (002032 CH), Joyoung Co Ltd A (002242 CH), KingClean Electric Co Ltd (603355 CH), Ecovacs Robotics Co Ltd (603486 CH)
Please feel free to contact us for specific data requests.

<ul><li>Air Conditioner y/y growth further accelerated in October, sales went up by 129%</li><li>Sales of Flat-panel TV picked up; share of leading traditional TV companies reached a new high</li><li>ASPs of all four major home appliance sectors increased by more than 10% vs year ago, driven by both price increase and consumption upgrade</li><li>The slowdown in the real estate market will likely have a negative impact on Air Conditioner sales in 2018</li></ul>Related tickers: <a href="https://www.smartkarma.com/entities/7622" target="_blank" data-smartkarma-citation="entities:7622:1">Gree Electric Appliances Inc Of Zhuhai (000651 CH)</a>, <a href="https://www.smartkarma.com/entities/16185" target="_blank" data-smartkarma-citation="entities:16185:1">Midea Group Co Ltd A (000333 CH)</a>, <a href="https://www.smartkarma.com/entities/20107" target="_blank" data-smartkarma-citation="entities:20107:1">Hisense Kelon Elec Hld H (921 HK)</a>, <a href="https://www.smartkarma.com/entities/7196" target="_blank" data-smartkarma-citation="entities:7196:1">Qingdao Haier Co Ltd A (600690 CH)</a>, <a href="https://www.smartkarma.com/entities/26046" target="_blank" data-smartkarma-citation="entities:26046:1">Wuxi Little Swan Co Ltd (000418 CH)</a>, <a href="https://www.smartkarma.com/entities/19424" target="_blank" data-smartkarma-citation="entities:19424:1">Hisense Electric Co Ltd A (600060 CH)</a>, <a href="https://www.smartkarma.com/entities/13735" target="_blank" data-smartkarma-citation="entities:13735:1">Skyworth Digital Co Ltd A (000810 CH)</a>, <a href="https://www.smartkarma.com/entities/15654" target="_blank" data-smartkarma-citation="entities:15654:1">TCL Multimedia Technology (1070 HK)</a>, <a href="https://www.smartkarma.com/entities/17702" target="_blank" data-smartkarma-citation="entities:17702:1">Sichuan Changhong Electric Co., Ltd. (600839 CH)</a>Please feel free to contact us for specific data requests.

Air Conditioner y/y growth further accelerated in October, sales went up by 129%Sales of Flat-panel TV picked up; share of leading traditional TV companies reached a new highASPs of all four major home appliance sectors increased by more than 10% vs year ago, driven by both price increase and consumption upgradeThe slowdown in the real estate market will likely have a negative impact on Air Conditioner sales in 2018Related tickers: Gree Electric Appliances Inc Of Zhuhai (000651 CH), Midea Group Co Ltd A (000333 CH), Hisense Kelon Elec Hld H (921 HK), Qingdao Haier Co Ltd A (600690 CH), Wuxi Little Swan Co Ltd (000418 CH), Hisense Electric Co Ltd A (600060 CH), Skyworth Digital Co Ltd A (000810 CH), TCL Multimedia Technology (1070 HK), Sichuan Changhong Electric Co., Ltd. (600839 CH)Please feel free to contact us for specific data requests.

Pre-Singles Day Online Major Home Appliance Sales in China – AC Maintained the Strong Performance

Leading Independent Investment Research, Morningstar, Inc.

Morningstar

Leading Independent Investment Research

Morningstar, Inc.

Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. We offer an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors. 

Morningstar provides data on more than 500,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 16 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries, with more than $180 billion in assets under advisement or management as of June 30, 2015. We have operations in 27 countries.

Download the Morningstar Fact Sheet : http://corporate.morningstar.com/US/documents/MarketingFactSheets/AboutMorningstarFactsheet.pdf

This week the Macau government proposed to the Second Standing Committee of Macau Legislative Assembly to allow smoking only in smoking lounges in casinos effective on Jan. 1, 2019, one year later than our existing expectation. Our current forecasts across our narrow moat coverage universe already factor in a negative mid-single-digit percentage point impact to VIP play in 2018, and postponing that one year is not expected to have any significant impact to our fair value estimates. Our current fair value estimates per share are HKD 17 for <a href="https://www.smartkarma.com/entities/472" target="_blank" data-smartkarma-citation="entities:472:1">MGM China Holdings Ltd (2282 HK)</a>, HKD 36 for <a href="https://www.smartkarma.com/entities/182" target="_blank" data-smartkarma-citation="entities:182:1">Sands China Ltd (1928 HK)</a>, HKD 14 for <a href="https://www.smartkarma.com/entities/473" target="_blank" data-smartkarma-citation="entities:473:1">Wynn Macau Ltd (1128 HK)</a>, USD 17 for <a href="https://www.smartkarma.com/entities/810" target="_blank" data-smartkarma-citation="entities:810:1">Melco Crown Entertainment ADR (MPEL US)</a>, HKD 36 for <a href="https://www.smartkarma.com/entities/806" target="_blank" data-smartkarma-citation="entities:806:1">Galaxy Entertainment Group Limited (27 HK)</a>, HKD 6.6 for <a href="https://www.smartkarma.com/entities/805" target="_blank" data-smartkarma-citation="entities:805:1">SJM Holdings Ltd (880 HK)</a>, $133 for <a href="https://www.smartkarma.com/entities/606" target="_blank" data-smartkarma-citation="entities:606:1">Wynn Resorts Ltd (WYNN US)</a>, $56 for <a href="https://www.smartkarma.com/entities/807" target="_blank" data-smartkarma-citation="entities:807:1">Las Vegas Sands Corp (LVS US)</a>, and $29.50 for <a href="https://www.smartkarma.com/entities/16227" target="_blank" data-smartkarma-citation="entities:16227:1">MGM Resorts International (MGM US)</a>. We continue to see Wynn trading at an attractive margin of safety.The revised bill creates a level playing field for casino operators. We have confirmed with a Macau legislative assembly member that the revised bill outlines that all VIP smoking gaming areas will be closed and that all casinos will be able to establish smoking lounges on both VIP and mass gaming floors. Therefore, under the proposed bill newer casinos will be able to establish smoking lounges in VIP gaming areas, while the older casinos will lose the smoking premium mass and VIP smoking area. As a result, Cotai casinos as a whole stand to gain market share at the expense of Macau peninsula casinos.Analyst: Chelsea Tam

This week the Macau government proposed to the Second Standing Committee of Macau Legislative Assembly to allow smoking only in smoking lounges in casinos effective on Jan. 1, 2019, one year later than our existing expectation. Our current forecasts across our narrow moat coverage universe already factor in a negative mid-single-digit percentage point impact to VIP play in 2018, and postponing that one year is not expected to have any significant impact to our fair value estimates. Our current fair value estimates per share are HKD 17 for MGM China Holdings Ltd (2282 HK), HKD 36 for Sands China Ltd (1928 HK), HKD 14 for Wynn Macau Ltd (1128 HK), USD 17 for Melco Crown Entertainment ADR (MPEL US), HKD 36 for Galaxy Entertainment Group Limited (27 HK), HKD 6.6 for SJM Holdings Ltd (880 HK), $133 for Wynn Resorts Ltd (WYNN US), $56 for Las Vegas Sands Corp (LVS US), and $29.50 for MGM Resorts International (MGM US). We continue to see Wynn trading at an attractive margin of safety.The revised bill creates a level playing field for casino operators. We have confirmed with a Macau legislative assembly member that the revised bill outlines that all VIP smoking gaming areas will be closed and that all casinos will be able to establish smoking lounges on both VIP and mass gaming floors. Therefore, under the proposed bill newer casinos will be able to establish smoking lounges in VIP gaming areas, while the older casinos will lose the smoking premium mass and VIP smoking area. As a result, Cotai casinos as a whole stand to gain market share at the expense of Macau peninsula casinos.Analyst: Chelsea Tam

Expected Macau Smoking Ban Creates a Level Playing Field for Operators

Investing in high growth Asian frontier economies., Asia Frontier Capital

Scott Osheroff

Investing in high growth Asian frontier economies.

Asia Frontier Capital

Asia Frontier Capital Ltd. is a pioneering fund management company based in Hong Kong that specializes in investing in high growth Asian frontier economies by managing the AFC Asia Frontier Fund , AFC Iraq Fund and the AFC Vietnam Fund.

The AFC Asia Frontier Fund invests in public equities of Asian frontier countries that are seeing increasing consumption due to favorable demographic trends, rising incomes and high GDP growth. The fund invests in listed equities of companies that have their principal business activities in Bangladesh, Bhutan, Cambodia, Iraq, Laos, Maldives, Mongolia, Myanmar (Burma), Nepal, Pakistan, Papua New Guinea, Sri Lanka and Vietnam. The AFC Asia Frontier Fund is positioned to take advantage of the continuing economic shifts in these countries and offers high returns combined with significant diversification opportunities. This fund is directed by the founder and CEO of Asia Frontier Capital, Thomas Hugger, who has been investing in frontier markets across Asia and Africa for more than 20 years.

The AFC Iraq Fund was launched on the 26th June 2015 and aims to achieve long-term capital appreciation for investors by capturing value and growth potential in the post conflict high-growth & resource rich Iraq market. The fund emphasises long term investment horizon to truly capture the opportunity in Iraq. The fund's investable universe consists of locally listed companies that have their principal business activities in Iraq as well as foreign listed companies that have the majority of the business in Iraq as a whole including the prosperous Kurdish Region of Iraq (KRI). The AFC Iraq Fund offers access to investments in post conflict recovery potential of Iraq, including the KRI, and/or stability in its territory. The AFC Iraq Fund is managed by Asia Frontier Capital (Iraq) Limited, Cayman Islands under the executive leadership team of Thomas Hugger (CEO & Fund Manager) and Ahmed Tabaqchali (CIO) who have more than 47 years of investment experience as well as an extensive background covering global, emerging, frontier and MENA markets.

The AFC Vietnam Fund invests exclusively in listed Vietnamese equities to capture value in growth companies with a focus on the small to medium size companies. This market segment offers a unique investment opportunity as the valuation gap between large- and small-cap stocks in Vietnam is presently much wider than in comparable neighboring markets and the valuations are significantly depressed versus their regional peers. The fund adopts a fundamental-quantitative approach and employs an in-house earnings model to identify attractive companies where we see high growth opportunities. In conjunction with targeting the maximum upside potential the portfolio has been structured to mitigate corporate government and liquidity risks. The fund invests in a diversified portfolio of 70-90 attractively valued companies to carefully control concentration risk.  This approach allows the fund to sell, or buy, positions without having a significant market impact. The fund is directed under the executive leadership of Thomas Hugger and Andreas Vogelsanger who have more than 50 years combined experience managing investments in frontier markets, Asia and around the world.

For more information about the fund, management team and investment strategy please contact us at info@asiafrontiercapital.com.

In line with our process of being on the ground in the countries we invest in, Scott Osheroff, Analyst at Asia Frontier Capital, traveled to Laos to visit portfolio companies and other companies on our shortlist. The photos in this article are all by AFC.

In line with our process of being on the ground in the countries we invest in, Scott Osheroff, Analyst at Asia Frontier Capital, traveled to Laos to visit portfolio companies and other companies on our shortlist. The photos in this article are all by AFC.

Asia Frontier Capital Travel Report: Laos

China

Gree Electric Appliances, Inc. of Zhuhai manufactures and sells a series of air conditioners.  The different series of air conditioners include window type, split type, floor type, mobile type, mobile split type and ceiling type.  The Company also produces air purifier.

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Gree Electric Appliances (000651 CH)

Shanghai/Shenzhen Connect - $8.5 Bn of Inflow in January (Kweichow Moutai, Gree, Midea)

In our Discover SZ/SH Connect series, we aim to help our investors understand the flow of northbound trades via the Shanghai Connect and Shenzhen...

Ke Yan, CFA, FRM

China "6.18" Home Appliance Online Sales

Online sales of the overall home appliance sector during the "6.18" promotional event went up by 37% vs 2017. Premiumization prevails among key...

Ben Li

Pre-Singles Day Online Major Home Appliance Sales in China – AC Maintained the Strong Performance

Air Conditioner y/y growth further accelerated in October, sales went up by 129% Sales of Flat-panel TV picked up; share of leading traditional TV...

Ben Li

Expected Macau Smoking Ban Creates a Level Playing Field for Operators

This week the Macau government proposed to the Second Standing Committee of Macau Legislative Assembly to allow smoking only in smoking lounges in...

Morningstar, Inc.

Asia Frontier Capital Travel Report: Laos

In line with our process of being on the ground in the countries we invest in, Scott Osheroff, Analyst at Asia Frontier Capital, traveled to Laos...

Asia Frontier Capital

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