Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

MSCI Emerging Markets Index / Technical Analysis

<p style="text-align: justify;">Emerging markets (EEM-US) are breaking above major $46.30 resistance to hit highs not seen since June 2018. Additionally, RS on EEM-US is near 1-year highs -- a positive risk-on signal. Stocks doing business in <strong>China, India, Taiwan</strong>, and <strong>South Korea </strong>continue to be a major focus when it comes to individual stock recommendations.</p>

Emerging markets (EEM-US) are breaking above major $46.30 resistance to hit highs not seen since June 2018. Additionally, RS on EEM-US is near 1-year highs -- a positive risk-on signal. Stocks doing business in China, India, Taiwan, and South Korea continue to be a major focus when it comes to individual stock recommendations.

<p>While a more cautious outlook is appropriate, as long as $77 holds (the September lows) we are constructive and would be buyers on a pullback. A move below $77 would start to get very concerning, and would leave $75 and the 200-day MA as last-ditch support. Considering the recent pullback we want to be sticking with areas that have continued to outperform in spite of recent broad market weakness. For that we look to the following leadership Sectors: <strong>Technology, Consumer Discretionary, Manufacturing, Materials, and Transportation</strong></p>

While a more cautious outlook is appropriate, as long as $77 holds (the September lows) we are constructive and would be buyers on a pullback. A move below $77 would start to get very concerning, and would leave $75 and the 200-day MA as last-ditch support. Considering the recent pullback we want to be sticking with areas that have continued to outperform in spite of recent broad market weakness. For that we look to the following leadership Sectors: Technology, Consumer Discretionary, Manufacturing, Materials, and Transportation

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.

Equity Capital Markets

Haier Smart Home / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/haier-smart-home-co-ltd" target="_blank" data-smartkarma-citation="entities:7196:1" rel="noopener">Haier Smart Home (600690 CH)</a> has filed for an IPO on the Hong Kong Stock Exchange and simultaneously plans to privatise <a href="https://www.smartkarma.com/entities/haier-electronics-group-co" target="_blank" data-smartkarma-citation="entities:4877:1" rel="noopener">Haier Electronics Group Co (1169 HK)</a> . However, the success of the IPO is dependent on Privatisation materialising.</li>
<li>We have covered Haier Smart Homes (HSH) in detail in our previous reports where we concluded that we were positive on the company’s growth prospects.</li>
</ul><blockquote>
<p><em>We remain positive on the company’s growth prospects given its well diversified product portfolio, large exposure to growing overseas markets and the ability to generate synergies through its acquisitions which should help the company expand its margins</em></p>
<p><em>- Previous Insight</em></p>
</blockquote><ul>
<li>Since we have already discussed about the company’s businesses and the outlook for each segment in detail in our previous insights, we intend to provide an update on the company’s recent financial performance and any changes to the company’s business outlook since we last wrote on the company.</li>
<li>Read our previous insights on the company:</li>
</ul><p><a href="https://www.smartkarma.com/insights/haier-sh-diversified-product-mix-overseas-exposure-and-synergies-to-support-a-higher-valuation" target="_blank" rel="noopener">https://www.smartkarma.com/insights/haier-sh-diversified-product-mix-overseas-exposure-and-synergies-to-support-a-higher-valuation</a>.</p><p><a href="https://www.smartkarma.com/insights/haier-sh-emerging-markets-refrigerator-growth-cushions-slowdown-in-china-and-developed-markets" target="_blank" rel="noopener">https://www.smartkarma.com/insights/haier-sh-emerging-markets-refrigerator-growth-cushions-slowdown-in-china-and-developed-markets</a></p><p><a href="https://www.smartkarma.com/insights/haier-sh-part-ii-lower-exposure-to-declining-ac-market-while-synergies-help-margin-expansion" target="_blank" rel="noopener">https://www.smartkarma.com/insights/haier-sh-part-ii-lower-exposure-to-declining-ac-market-while-synergies-help-margin-expansion</a>.</p>



Haier Smart Home (600690 CH) has filed for an IPO on the Hong Kong Stock Exchange and simultaneously plans to privatise Haier Electronics Group Co (1169 HK) . However, the success of the IPO is dependent on Privatisation materialising.
We have covered Haier Smart Homes (HSH) in detail in our previous reports where we concluded that we were positive on the company’s growth prospects.

We remain positive on the company’s growth prospects given its well diversified product portfolio, large exposure to growing overseas markets and the ability to generate synergies through its acquisitions which should help the company expand its margins
- Previous Insight

Since we have already discussed about the company’s businesses and the outlook for each segment in detail in our previous insights, we intend to provide an update on the company’s recent financial performance and any changes to the company’s business outlook since we last wrote on the company.
Read our previous insights on the company:
https://www.smartkarma.com/insights/haier-sh-diversified-product-mix-overseas-exposure-and-synergies-to-support-a-higher-valuation.https://www.smartkarma.com/insights/haier-sh-emerging-markets-refrigerator-growth-cushions-slowdown-in-china-and-developed-marketshttps://www.smartkarma.com/insights/haier-sh-part-ii-lower-exposure-to-declining-ac-market-while-synergies-help-margin-expansion.

Haier Smart Homes IPO: Growing Exposure to Emerging Markets and M&A Opportunities to Drive Growth

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Haier Electronics Group Co / Event-Driven

<div>
<p><a href="https://www.smartkarma.com/entities/haier-electronics-group-co" target="_blank" data-smartkarma-citation="entities:4877:1" rel="noopener"></a>On the 31 July, <a href="https://www.smartkarma.com/entities/haier-electronics-group-co" target="_blank" data-smartkarma-citation="entities:4877:1" rel="noopener">Haier Electronics Group Co (1169 HK)</a> (HEG) <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2020/0731/2020073101131.pdf" target="_blank" rel="noopener">announced</a> a pre-conditional Scheme such that HEG shareholder will receive 1.6 new <a href="https://www.smartkarma.com/entities/haier-smart-home-co-ltd" target="_blank" data-smartkarma-citation="entities:7196:1" rel="noopener">Haier Smart Home (600690 CH)</a> (HSH) H shares plus HK$1.95 in cash. </p>
<p>The pre-condition concerned approval from HSH's shareholders and CSRC approval. The pre-conditions were <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2020/0901/2020090103529.pdf" target="_blank" rel="noopener">fulfilled</a> on the 1 September. The next step in this process is for HEG shareholders to vote on the Scheme. The despatch of the Scheme Doc has now been extended to the 30 November, from 4 September previously.</p>
<p> A 632-page Application Proof for the listing of HSH H-shares has now been <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2020/0911/2020091100023.pdf" target="_blank" rel="noopener">lodged</a>. This will be a <a href="https://en-rules.hkex.com.hk/entiresection/2269" target="_blank" rel="noopener">listing by introduction</a>.</p>
<p>The question at the time of the Scheme announcement, as it is now - is where will the HSH (as yet unlisted) H-shares trade with respect to the HSH A-shares? </p>
<p>An independent valuer backed out an indicative value under the Scheme of HK$31.11-HK$31.90 - or $31.51 at the mid-point. However, this was just a valuer's opinion. There is no guarantee this is where the Hs will trade. </p>
</div>
<div>
<p>The market is assigning around a 37% discount (HSH Hs vs. HSH As). Relative to a basket of liquid A/Hs and listed A/H peers, this is a level to get involved.</p>
</div>
<div>
<p>More below the fold.</p>
</div>


On the 31 July, Haier Electronics Group Co (1169 HK) (HEG) announced a pre-conditional Scheme such that HEG shareholder will receive 1.6 new Haier Smart Home (600690 CH) (HSH) H shares plus HK$1.95 in cash. 
The pre-condition concerned approval from HSH's shareholders and CSRC approval. The pre-conditions were fulfilled on the 1 September. The next step in this process is for HEG shareholders to vote on the Scheme. The despatch of the Scheme Doc has now been extended to the 30 November, from 4 September previously.
 A 632-page Application Proof for the listing of HSH H-shares has now been lodged. This will be a listing by introduction.
The question at the time of the Scheme announcement, as it is now - is where will the HSH (as yet unlisted) H-shares trade with respect to the HSH A-shares? 
An independent valuer backed out an indicative value under the Scheme of HK$31.11-HK$31.90 - or $31.51 at the mid-point. However, this was just a valuer's opinion. There is no guarantee this is where the Hs will trade. 


The market is assigning around a 37% discount (HSH Hs vs. HSH As). Relative to a basket of liquid A/Hs and listed A/H peers, this is a level to get involved.


More below the fold.


China Conch Venture Holdings / Event-Driven

<div>
<p>This week in StubWorld ...</p>
</div>
<div>
<div>
<div class="content-highlight">
<p><a href="https://www.smartkarma.com/entities/china-conch-venture-holdings-ltd" target="_blank" data-smartkarma-citation="entities:19943:1" rel="noopener">China Conch Venture Holdings (586 HK)</a> continues to underperform 17.8%-held <a href="https://www.smartkarma.com/entities/anhui-conch-cement-co-ltd-094855ab-abec-4b71-956b-5bfc85e22fdd" target="_blank" data-smartkarma-citation="entities:389:1" rel="noopener">Anhui Conch Cement Co Ltd A (600585 CH)</a>, with the implied stub at its lowest level since CCV was listed in December 2013.</p>
</div>
</div>
</div>
<div>
<p>Preceding my comments on CCV and <a href="https://www.smartkarma.com/entities/haier-smart-home-co-ltd" target="_blank" data-smartkarma-citation="entities:7196:1" rel="noopener">Haier Smart Home (600690 CH)</a> / <a href="https://www.smartkarma.com/entities/haier-electronics-group-co" target="_blank" data-smartkarma-citation="entities:4877:1" rel="noopener">Haier Electronics Group Co (1169 HK)</a>, are the weekly setup/unwind tables for Asia-Pacific Holdcos.</p>
</div>
<div>
<div>
<div class="content-remarks">
<p>These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.</p>
</div>
</div>
</div>


This week in StubWorld ...




China Conch Venture Holdings (586 HK) continues to underperform 17.8%-held Anhui Conch Cement Co Ltd A (600585 CH), with the implied stub at its lowest level since CCV was listed in December 2013.




Preceding my comments on CCV and Haier Smart Home (600690 CH) / Haier Electronics Group Co (1169 HK), are the weekly setup/unwind tables for Asia-Pacific Holdcos.




These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.




StubWorld: Waste Not, Want Not. China Conch Venture's All-Time Low

Hong Kong

Haier Electronics Group Co Ltd and its subsidiaries are principally engaged in the research, development, manufacture and sale of washing machines and water heaters in the PRC. The Group is also engaged in the integrated channel services  business for other home electric appliance products such as refrigerators, televisions and air-conditioners.

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Haier Electronics Group Co (1169 HK)

Emerging Markets Breaking Out

Emerging markets (EEM-US) are breaking above major $46.30 resistance to hit highs not seen since June 2018. Additionally, RS on EEM-US is near 1...

Vermilion Research

Cautiously Optimistic on Global Equities

We are constructive on global equities and would be buyers on a pullback. A move below $77 would start to get very concerning, and would leave $75...

Vermilion Research

Haier Smart Homes IPO: Growing Exposure to Emerging Markets and M&A Opportunities to Drive Growth

Haier Smart Homes has filed for an IPO on the Hong Kong Stock Exchange and simultaneously plans to privatise Haier Electronics Group. However, the...

Shifara Samsudeen, ACMA, CGMA

Haier (1169 HK): Back To Entry Levels

Haier Electronics Group Co (1169 HK) (HEG) was briefly suspended pursuant to the Takeovers Code on the 19 December 2019, which was followed by...

David Blennerhassett

StubWorld: Waste Not, Want Not. China Conch Venture's All-Time Low

This week in StubWorld ... China Conch Venture Holdings (586 HK) continues to underperform 17.8%-held Anhui Conch Cement Co Ltd A (600585 CH),...

David Blennerhassett

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