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

<ul>
<li>We analyse the changes of A-H premium on 142 stocks over the last week. The average A-H premium was 127.4% as of Oct 21st.</li>
<li>The average A-H premium changed by -2.8ppt weeok on week, led by consumer staples, consumer discretionary, energy and offset by financials.</li>
<li>We highlight weekly changes in A-H premium for Remegen, Pharmaron, Flat Glass, Shanghai Fudan, GWM, China Life.</li>
</ul>


We analyse the changes of A-H premium on 142 stocks over the last week. The average A-H premium was 127.4% as of Oct 21st.
The average A-H premium changed by -2.8ppt weeok on week, led by consumer staples, consumer discretionary, energy and offset by financials.
We highlight weekly changes in A-H premium for Remegen, Pharmaron, Flat Glass, Shanghai Fudan, GWM, China Life.


A-H Premium Weekly (Oct 21st): Remegen, Pharmaron, Flat Glass, Shanghai Fudan, GWM, China Life

Articles from Caixin Global, Caixin Global

Caixin Global

Articles from Caixin Global

Caixin is a media group dedicated to providing financial and business news through periodicals, online content, mobile apps, conferences, books and TV/video programs. Caixin aims to blaze a trail that helps traditional media prosper in the new media age through integrated multimedia platforms.

News from Caixin

Cross Asset Strategy

<ul><li>In Depth: How China is trying to get debt dodgers to pay up</li><li>Record numbers apply for China’s teachers exam amid bleak job market</li><li>Trending in China: Good samaritans ‘coldly’ told to self-isolate after helping with overturned ambulance</li></ul>

In Depth: How China is trying to get debt dodgers to pay upRecord numbers apply for China’s teachers exam amid bleak job marketTrending in China: Good samaritans ‘coldly’ told to self-isolate after helping with overturned ambulance

CX Daily: How China Is Trying To Get Debt Dodgers To Pay Up

Equity Bottom-Up

<ul><li>Honda Motor Co. Ltd.’s Chinese unit will set up a new joint venture with two Chinese partners to procure electric vehicle batteries from battery giant Contemporary Amperex Technology Co. Ltd. (CATL)</li><li>The joint venture will be 50% owned by Honda Motor (China) Investment Co. Ltd. and 25% each by Dongfeng Motor Corp. Ltd. and Guangzhou Automobile Group Co. Ltd. (GAC)</li><li>Honda’s joint ventures with Dongfeng and Guangzhou Automobile already use CATL batteries in electric cars made in China</li></ul>

Honda Motor Co. Ltd.’s Chinese unit will set up a new joint venture with two Chinese partners to procure electric vehicle batteries from battery giant Contemporary Amperex Technology Co. Ltd. (CATL)The joint venture will be 50% owned by Honda Motor (China) Investment Co. Ltd. and 25% each by Dongfeng Motor Corp. Ltd. and Guangzhou Automobile Group Co. Ltd. (GAC)Honda’s joint ventures with Dongfeng and Guangzhou Automobile already use CATL batteries in electric cars made in China

Honda Sets Up New Venture to Procure Batteries From CATL

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.

Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/calb-co-ltd" target="_blank" data-smartkarma-citation="entities:35985:1" rel="noopener">CALB (CALBLZ CH)</a>, a leading EV battery manufacturer, is seeking to raise US$2.0 billion through an HKEx IPO, according to press reports.</li>
<li>In <a href="https://www.smartkarma.com/insights/calb-ipo-the-bull-case" target="_blank" data-smartkarma-citation="insights:80243" rel="noopener">CALB IPO: The Bull Case</a>, we highlighted the key elements of the bull case. In this note, we outline the bear case.  </li>
<li>The key elements of the bear case rest on its small scale, low profitability and high FCF burn compared to listed peers.   </li>
</ul>



CALB (CALBLZ CH), a leading EV battery manufacturer, is seeking to raise US$2.0 billion through an HKEx IPO, according to press reports.
In CALB IPO: The Bull Case, we highlighted the key elements of the bull case. In this note, we outline the bear case.  
The key elements of the bear case rest on its small scale, low profitability and high FCF burn compared to listed peers.   


Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/byd-co-ltd-h" target="_blank" data-smartkarma-citation="entities:20962:1" rel="noopener">BYD (1211 HK)</a>’s shares declined by -8% on <a href="https://di.hkex.com.hk/di/NSForm2.aspx?fn=CS20220829E00231&amp;amp;sa2=ns&amp;amp;sid=2508&amp;amp;sd=30/08/2021&amp;amp;ed=30/08/2022&amp;amp;sa1=cl&amp;amp;scsd=30/08/2021&amp;amp;sced=30/08/2022&amp;amp;sc=01211&amp;amp;src=Main&amp;amp;lang=EN&amp;amp;tk=ds" target="_blank" rel="noopener">disclosure</a> that <a href="https://www.smartkarma.com/entities/berkshire-hathaway-inc-cl-b" target="_blank" data-smartkarma-citation="entities:8635:1" rel="noopener">Berkshire Hathaway Inc Cl B (BRK/B US)</a> trimmed its stake from 20.04% to 19.92% of outstanding H Shares. </li>
<li>Berkshire will likely follow its <a href="https://www.smartkarma.com/entities/petrochina-co-ltd-h" target="_blank" data-smartkarma-citation="entities:262:1" rel="noopener">PetroChina (857 HK)</a> playbook and materially sell down over the next few months. Buffet stated that the PetroChina exit was “a decision based on valuation.”</li>
<li>Berkshire will apply the same investment discipline to the BYD stake. While the shares are trading at a discount to historical multiples, the Berkshire stake is an overhang.</li>
</ul>



BYD (1211 HK)’s shares declined by -8% on disclosure that Berkshire Hathaway Inc Cl B (BRK/B US) trimmed its stake from 20.04% to 19.92% of outstanding H Shares. 
Berkshire will likely follow its PetroChina (857 HK) playbook and materially sell down over the next few months. Buffet stated that the PetroChina exit was “a decision based on valuation.”
Berkshire will apply the same investment discipline to the BYD stake. While the shares are trading at a discount to historical multiples, the Berkshire stake is an overhang.


Berkshire BYD’s Selldown Likely to Follow Its PetroChina Playbook

China

Great Wall Motor Company Limited, through its subsidiaries, manufactures and sells pick-up trucks and sport-utility vehicles (SUVs) in China under branded names. The Company also researches and develops, and manufactures principal automotive parts and components for use in the assembly of pick-up trucks and SUVs.

BAIC BluePark New Energy Technology Co.,Ltd. operates as a passenger car manufacturer. The Company engages in research, development, and marketing of new energy vehicles and power battery system. BAIC BluePark New Energy Technology conducts businesses in China.

BAIC BluePark New Energy Techn (600733 CH)

Anhui Jianghuai Automobile Co., Ltd. manufactures and markets bus and truck chassis, gear boxes, other auto parts, and business automobiles.

NIO Inc. manufactures and sells automobiles. The Company offers electric vehicles and parts, as well as provides battery charging services. NIO serves customers worldwide.

FAW Jiefang Group Co., Ltd, through joint ventures, manufactures and markets cars and auto parts.  The Company produces automobiles, transmission systems, and engines.  FAW Car also provides auto repair and customizing services.

Guangzhou Automobile Group Company, Ltd. manufactures, sells, and services automobiles. The Company is also involved in automobile parts and components, and auto finance and related services for both overseas and domestic markets.

Chongqing Changan Automobile Company Limited develops, manufactures, and markets mini cars, mini sedans, full size sedans, and engines.

Chongqing Changan Automobile Company (200625 CH)

Li Auto Inc. manufactures automobiles. The Company designs, develops, and sells smart new energy electric sport utility vehicles. Li Auto conducts businesses in China.

BAIC Motor Corporation Limited designs, researches, develops, manufactures and sells a variety of passenger vehicles in China.

Dongfeng Motor Group Company Limited, through joint ventures, designs, manufactures, and markets diesel engines, light trucks, automobiles, castings, and related spare parts.

PT Astra International Tbk assembles and distributes automobiles, motorcycles, and their related spare parts.  Through its subsidiaries, the Company also operates in the mining, development of plantations, financial and information technology.

NISSAN MOTOR CO., LTD. manufactures and distributes automobiles and related parts. It also provides financing services. Nissan delivers a comprehensive range of products under various brands. The Company manufactures in Japan, the United States, Mexico, the United Kingdom and many other countries.

Geely Automobile Holdings Limited operates as a passenger vehicles manufacturing company. The Company provides passenger vehicles development, manufacturing, sales, and other services. Geely Automobile Holdings also exports passenger vehicles.

Hero MotoCorp Ltd. designs, manufactures and distributes motorcycles. The Company's products also include motorcycle parts and accessories.

Subaru Corp manufactures passenger cars, buses, motor vehicle parts, and industrial machinery.  The Company also produces aircraft parts and supplies it to defense agency and Boeing Co.  The Company sells its passenger cars under the Subaru brand name.

Yamaha Motor Co., Ltd. manufactures motorcycles.  The Company also produces motor vehicle engines for Toyota Motor Corp. and Ford Motor Co.  Yamaha Motor's specialty products include motor boats, snowmobiles, golf carts, and electric power generators.  Yamaha Motor sells products in Japan, North America, Europe, Asia, and South America.

Isuzu Motors Limited manufactures and markets trucks and automobile parts. The Company's products include pickup trucks, light/heavy duty trucks, medium and large-sized buses, recreational vehicles, and sport utility vehicles.

TVS Motor Company Limited manufactures motorcycles, mopeds, and scooters. The Company provides spark ignition operated outboard motors, combustion spark ignition engines, critical engines, and transmission parts. TVS Motor Company serves customers in India.

Eicher Motors Ltd. manufactures light commercial vehicles which are sold domestically and are also exported to other countries. Eicher Motors also manufactures two-wheelers and automotive gears.

Mazda Motor Corporation manufactures and sells automobiles, trucks, auto parts, and its accessories.  The Company operates its business worldwide.

Guangzhou Automobile Group Company Limited manufactures and sells automobiles. The Company vehicles, motorcycles, and other products. Guangzhou Automobile Group also provides automobile parts manufacturing, automotive business services, automotive finance, and other services.

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Guangzhou Automobile Group (601238 CH)

A-H Premium Weekly (Oct 21st): Remegen, Pharmaron, Flat Glass, Shanghai Fudan, GWM, China Life

We analyzed A-H premium changes in the past week and highlight A-H premium changes for Remegen, Pharmaron, Flat Glass, Shanghai Fudan, GWM, China...

Ke Yan, CFA, FRM

CX Daily: How China Is Trying To Get Debt Dodgers To Pay Up

In Depth: How China is trying to get debt dodgers to pay up. Record numbers apply for China’s teachers exam amid bleak job market

Caixin Global

Honda Sets Up New Venture to Procure Batteries From CATL

Honda Motor Co. Ltd.’s Chinese unit will set up a new joint venture with two Chinese partners to procure electric vehicle batteries from battery...

Caixin Global

CALB IPO: The Bear Case

The key elements of the bear case rest on its small scale, low profitability and high FCF burn compared to listed peers.

Arun George

Berkshire BYD’s Selldown Likely to Follow Its PetroChina Playbook

Berkshire will likely follow its PetroChina playbook and materially sell down over the next few months. While the valuation is undemanding, the...

Arun George

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