Japan/Asia Long-Short, LightStream Research

Mio Kato

Japan/Asia Long-Short

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.

Event-Driven

<ul>
<li>
<a href="https://news.yahoo.com/exclusive-tencent-plans-u-listed-092112568.html" target="_blank" rel="noopener">Tencent is reportedly considering taking Douyu private</a>, potentially in partnership with a PE fund. </li>
<li>Given weak earnings and reports of strategic confusion within management this is not entirely surprising. </li>
<li>While the news is positive for Douyu we would prefer to look one connection away at the implications for the less troubled Huya.</li>
</ul>



Tencent is reportedly considering taking Douyu private, potentially in partnership with a PE fund. 
Given weak earnings and reports of strategic confusion within management this is not entirely surprising. 
While the news is positive for Douyu we would prefer to look one connection away at the implications for the less troubled Huya.


Huya – If Douyu Is Being Taken Private Huya Should Be Too

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

<ul>
<li>Cloud Village Inc. (CVI), also known as NetEase Music, raised around US$420m in its Hong Kong IPO.</li>
<li>The company has obtained investments from Baidu and Alibaba, along with other investors.</li>
<li>In this note, we will talk about the trading dynamics.</li>
</ul>


Cloud Village Inc. (CVI), also known as NetEase Music, raised around US$420m in its Hong Kong IPO.
The company has obtained investments from Baidu and Alibaba, along with other investors.
In this note, we will talk about the trading dynamics.


Cloud Village (NetEase Music) IPO Trading - One of the Lowest Insti Subscriptions Yet

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>
<a href="https://www.smartkarma.com/entities/so-young-international-inc" target="_blank" data-smartkarma-citation="entities:28025:1" rel="noopener">So-Young (SY US)</a> has announced a preliminary non-binding proposal from its chairman, Xing Jin, of $5.30/ADS - a 22.7% premium to last close. </li>
<li>Xing Jin controls 83.9% of the voting power. If a firm Offer unfolds, which should involve a long-form merger, this is effectively done. </li>
<li>The pressure on Chinese stocks in the US to go private or change listing venue by 2024 is still on.</li>
</ul>



So-Young (SY US) has announced a preliminary non-binding proposal from its chairman, Xing Jin, of $5.30/ADS - a 22.7% premium to last close. 
Xing Jin controls 83.9% of the voting power. If a firm Offer unfolds, which should involve a long-form merger, this is effectively done. 
The pressure on Chinese stocks in the US to go private or change listing venue by 2024 is still on.


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.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/cloud-village-inc" target="_blank" data-smartkarma-citation="entities:33412:1" rel="noopener">Cloud Village (CLV HK)</a> is the second-largest online music platform after <a href="https://www.smartkarma.com/entities/tencent-music-entertainment" target="_blank" data-smartkarma-citation="entities:27255:1" rel="noopener">Tencent Music (TME US)</a> in China. It has launched its IPO to raise $400 million at the IPO mid-point.</li>
<li>In <a href="https://www.smartkarma.com/insights/cloud-village-netease-music-ipo-not-yet-a-sound-investment" target="_blank" data-smartkarma-citation="insights:61441" rel="noopener">Cloud Village (NetEase Music) IPO: Not yet a Sound Investment</a>, we stated that the 9M21 update is underwhelming with slowing growth and a marginal decline in losses. </li>
<li>Our valuation analysis suggests that the IPO price is unattractive. We would give the IPO a pass. </li>
</ul>



Cloud Village (CLV HK) is the second-largest online music platform after Tencent Music (TME US) in China. It has launched its IPO to raise $400 million at the IPO mid-point.
In Cloud Village (NetEase Music) IPO: Not yet a Sound Investment, we stated that the 9M21 update is underwhelming with slowing growth and a marginal decline in losses. 
Our valuation analysis suggests that the IPO price is unattractive. We would give the IPO a pass. 


Cloud Village (NetEase Music) IPO: Valuation Insights

Equity Analyst, LightStream Research

Shifara Samsudeen, ACMA, CGMA

Equity Analyst

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/bilibili-inc" target="_blank" data-smartkarma-citation="entities:26793:1" rel="noopener">Bilibili Inc (BILI US)</a> reported 3Q2021 results which saw revenues increase 61.4% YoY to RMB5.2bn while operating losses for the quarter increased to 36.1% of revenues vs 33.6% in 3Q2020. </li>
<li>Mobile games revenue declined YoY for the first time in 2Q2021, however, the segment has resumed growth with a 9.1% YoY increase in third quarter.</li>
<li>Except for mobile games, the other three segments saw strong growth in top line with advertising revenues growing more than 100% during the quarter</li>
</ul>



Bilibili Inc (BILI US) reported 3Q2021 results which saw revenues increase 61.4% YoY to RMB5.2bn while operating losses for the quarter increased to 36.1% of revenues vs 33.6% in 3Q2020. 
Mobile games revenue declined YoY for the first time in 2Q2021, however, the segment has resumed growth with a 9.1% YoY increase in third quarter.
Except for mobile games, the other three segments saw strong growth in top line with advertising revenues growing more than 100% during the quarter


Bilibili: Mobile Games Resumes Growth; Losses Widening in 3Q Is in Line with Peers

United States

TrueCar, Inc. develops and publishes an online automotive information and communication platform. The Company provides data and price reports for cars both online and over the phone for consumers and a communications platform for automobile dealers to communicate with consumers. TrueCar serves customers throughout the United States.

Tucows Inc. provides wholesale digital products to Internet service providers and Web hosting companies.  The Company distributes electronic business services and applications on the Internet.  The Company provides wholesale domain name registration.

Quotient Technology Inc. operates a promotion platform. The Company offers online printable, social, and mobile coupons in apparel, automotive, beverages, books, entertainment, food, healthcare, household, office supplies, pet, photography, professional services, and restaurants.

DHI Group, Inc. is a provider that specialize in career sites and career fairs for high growth vertical sectors. The Company provides services to help recruiters, consultants and businesses hire and train highly qualified professionals.

Travelzoo Inc. provides online marketing solutions to the travel industry.  The Company publishes deals from travel, entertainment, and local companies. Travelzoo researches, evaluates, and tests numerous deals and recommends deals whose accuracy and availability can be confirmed.

Brightcove Inc. provides video hosting and publishing services. The Company operates a video platform whose services include uploading and encoding, content management, players and styling, delivery, and live streaming. Brightcove offers its services globally.

Veritone, Inc. operates as a cloud-based artificial intelligence media technology company. The Company develops a cloud-based ecosystem that enables real-time audio and video processing, audience analytics, search, retrieval, replay, and share capabilities. Veritone offers visual and audio discovery applications.

LivePerson, Inc. provides technology that facilitates real-time sales and customer service for companies doing business on the Internet.  The Company, an application service provider, offers its real-time interaction technology as an outsourced service.  The LivePerson service enables its clients to communicate directly with Internet users via text-based chat.

Marchex, Inc. provides Internet advertising services.  The Company offers call-based advertising and related services, pay-per-click advertising and related services and proprietary traffic sources.  Marchex also offers a suite of marketing products to resellers.  The Company serves business customers of all sizes.

comScore Inc provides data-based Internet infrastructure services to the Internet electronic economy.

Xiamen 35.com Technology Co., Ltd. researches and develops application software, provides corporate email hosting services, electronic business homepage building services.  The Company also provides domain name, office automation system (OA), and customer relationship management system (CRM).

Trade-Van Information Services Co., Ltd. provides custom filing services for importers and exporters through EDI (Electronic Data Interchange).  The Company's services include EDI, interactive EDI, file transfer, electronic mail, database inquiry, and archiving.

ACCESS CO., LTD. develops browser software for the Internet.  The Company designs custom browsers for manufacturers of electronics such as cellular phones, portable e-mail devices, handheld PCs, video game consoles, and car navigation systems.

ADDCN Technology Co., Ltd. operates an Internet trading platform and online apparel retail businesses. The Company's platforms trades in virtual treasures, housing for tenants and buyers, car sales and apparel retail.

Serko Ltd operates as an online corporate travel booking and expense management company.

MiX Telematics Limited is a leading global provider of fleet and mobile asset management solutions delivered as SaaS to customers in various countries. The company's products and services provide enterprise fleets, small fleets and consumers with solutions for safety, efficiency and security.

MarkLines Co., Ltd. is specialized in offering information about automobile industry on the Internet.  The Company also offers consulting and temporary staffing services.

Softbank Technology Corp. provides electronic commerce (EC) related services. The Company mainly provides Internet systems integration, web site management, marketing consulting, and technical support services.

Feelingk Co., Ltd. provides end-to-end solutions for the wireless Internet system.  The Company's products includes WAP gateway, Short Messaging Service Center (SMSC), and Push Proxy Gateway (PPG).  Feelingk provides wireless solution to major mobile telecom service providers such as SK and LG telecom.

Carta Holdings, Inc. provides on-line information retrieval services on a contract or fee basis.

HUYA Inc. operates as a game live streaming platform. The Company offers interactive video broadcast services including e-sports, music, reality show, entertainment genres, talent shows, and anime and outdoor activities. HUYA serves customers in China.

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HUYA (HUYA US)

Huya – If Douyu Is Being Taken Private Huya Should Be Too

Tencent is reportedly considering taking Douyu private. While the news is positive for Douyu we would prefer to look one connection away at the...

Mio Kato

Cloud Village (NetEase Music) IPO Trading - One of the Lowest Insti Subscriptions Yet

Cloud Village Inc. (CVI), also known as NetEase Music, raised around US$420m in its Hong Kong IPO. In this note, we will talk about the trading...

Sumeet Singh

So-Young's Low-Balled Proposal

How the regulator assesses such a deal, and the timing thereon, is indeterminate. But So-Young is very beaten up. Buying around here is probably...

David Blennerhassett

Cloud Village (NetEase Music) IPO: Valuation Insights

Cloud Village has launched its IPO to raise $400 million at the IPO mid-point. Our valuation analysis suggests that the IPO price is unattractive....

Arun George

Bilibili: Mobile Games Resumes Growth; Losses Widening in 3Q Is in Line with Peers

Bilibili's operating losses widened during 3Q2021. We have observed that Huya's profit margins declined during the quarter while Douyu's paying...

Shifara Samsudeen, ACMA, CGMA

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