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

Beijing Airdoc Technology / Equity Capital Markets

<div><p><a href="https://www.smartkarma.com/entities/beijing-airdoc-technology-co-ltd" target="_blank" data-smartkarma-citation="entities:33524:1" rel="noopener">Beijing Airdoc Technology (2251 HK)</a><span> is a global market leader and pioneer in providing AI-empowered retina-based early detection, auxiliary diagnosis and health risk assessment solutions. The core product is Airdoc-AIFUNDUS which is an AI-based Software-as-a-Medical Device (SaMD) that uses deep learning algorithms to accurately detect and diagnose chronic diseases from retinal images. Airdoc-AIFUNDUS (1.0), the first version of the core product, was commercialised at the start of 2021. </span></p></div><div><p>At the proposed IPO price range of HK$75.10-81.30 per share, Airdoc will have a market cap of HK$7,778-8,420 million ($1.0-1.1 billion). At the mid-point of the IPO price range, the net proceeds are HK$1,632.7 million ($210 million).</p></div><div><p>Eight cornerstone investors will purchase $69.5 million worth of the offer shares (31.0% of the offer shares at the mid-point of the IPO price range). Three out of the eight cornerstones are existing investors. They are LAV Group, Lake Bleu Capital and OrbiMed. The remaining cornerstones which are not existing shareholders are CloudAlpha Capital, GF Fund, IvyRock Funds, LMR Fund and WT Funds.</p></div><div><p>In <a href="https://www.smartkarma.com/insights/airdoc-technology-ipo-initiation-seeing-the-light" target="_blank" data-smartkarma-citation="insights:58501" rel="noopener">Airdoc Technology IPO Initiation: Seeing the Light</a>, we opined that, unlike most healthcare IPO hopefuls, Airdoc has recently commercially launched a version of its core product. With industry-leading sensitivity and specificity achieved in multi-centre clinical trials, Airdoc-AIFUNDUS has the potential to succeed in a competitive market. We concluded that Airdoc is worth a closer look.</p></div><div><div><div class="content-highlight"><p>Our valuation analysis suggests that the IPO price range is attractive. We also note that the mid-point of the IPO price range is a modest 5.7% discount to the last valuation round (Series D to raise $38 million on 30 April 2021).  </p></div></div></div>

Beijing Airdoc Technology (2251 HK) is a global market leader and pioneer in providing AI-empowered retina-based early detection, auxiliary diagnosis and health risk assessment solutions. The core product is Airdoc-AIFUNDUS which is an AI-based Software-as-a-Medical Device (SaMD) that uses deep learning algorithms to accurately detect and diagnose chronic diseases from retinal images. Airdoc-AIFUNDUS (1.0), the first version of the core product, was commercialised at the start of 2021. At the proposed IPO price range of HK$75.10-81.30 per share, Airdoc will have a market cap of HK$7,778-8,420 million ($1.0-1.1 billion). At the mid-point of the IPO price range, the net proceeds are HK$1,632.7 million ($210 million).Eight cornerstone investors will purchase $69.5 million worth of the offer shares (31.0% of the offer shares at the mid-point of the IPO price range). Three out of the eight cornerstones are existing investors. They are LAV Group, Lake Bleu Capital and OrbiMed. The remaining cornerstones which are not existing shareholders are CloudAlpha Capital, GF Fund, IvyRock Funds, LMR Fund and WT Funds.In Airdoc Technology IPO Initiation: Seeing the Light, we opined that, unlike most healthcare IPO hopefuls, Airdoc has recently commercially launched a version of its core product. With industry-leading sensitivity and specificity achieved in multi-centre clinical trials, Airdoc-AIFUNDUS has the potential to succeed in a competitive market. We concluded that Airdoc is worth a closer look.Our valuation analysis suggests that the IPO price range is attractive. We also note that the mid-point of the IPO price range is a modest 5.7% discount to the last valuation round (Series D to raise $38 million on 30 April 2021).  

Airdoc Technology IPO: Valuation Insights

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

<p>Hong Kong SFC reported aggregate short position as of Sep 17. The aggregate short value for equities decreased by $2,689m (-3.9%) WoW but increased by $2,234m (+3.5%) over the preceding four weeks.</p><p>Most shorted stocks by aggregate short value of positions are Ping An Insurance (Group) Company Of China, Ltd./2318 HK($3,288m, -11.6% WoW), China Merchants Bank Co., Ltd./3968 HK($2,378m, -13.4% WoW), Zhongsheng Group Holdings Limited/881 HK($1,846m, -5.8% WoW), Anta Sports Products Limited/2020 HK($1,503m, -8.7% WoW), Meituan/3690 HK($1,496m, -15.0% WoW).</p><section class="figure"><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/232/084/original/Hong_Kong_Market_Short_Position_Value_%28line%29_and_1W_Changes_%28bar%29_%28%24m%292021-09-27+18_20_37.png?1632738370" class="editor-image img-responsive" data-smartkarma-image-id="232084"></figure></section>

Hong Kong SFC reported aggregate short position as of Sep 17. The aggregate short value for equities decreased by $2,689m (-3.9%) WoW but increased by $2,234m (+3.5%) over the preceding four weeks.Most shorted stocks by aggregate short value of positions are Ping An Insurance (Group) Company Of China, Ltd./2318 HK($3,288m, -11.6% WoW), China Merchants Bank Co., Ltd./3968 HK($2,378m, -13.4% WoW), Zhongsheng Group Holdings Limited/881 HK($1,846m, -5.8% WoW), Anta Sports Products Limited/2020 HK($1,503m, -8.7% WoW), Meituan/3690 HK($1,496m, -15.0% WoW).

HK Short Interest: Short Spiked for BeiGene

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.

Dingdang Health Technology Gro / Equity Capital Markets

<p><a href="https://www.smartkarma.com/entities/dingdang-health-technology-group-ltd" target="_blank" data-smartkarma-citation="entities:33528:1" rel="noopener">Dingdang Health Technology Group (DDH HK)</a>, China’s largest product and service provider in the on-demand digital pharmacy industry has filed for an IPO to list its shares on the Hong Kong Stock Exchange. According to news media outlets, the company plans to raise about US$250-300m through the IPO.</p><p>The ongoing regulatory overhaul in the Chinese tech sector and NMPA’s draft measures to increase supervision and regulate the country’s online pharmaceutical sales have impacted JD Health and other players in the market. WeDoctor who also offers online healthcare services in China filed for a HKEx listing in April this year and the company has not been able to progress yet with its planned IPO.</p><p>In this insight, we take a look at DingDang Health’s business model, segments, revenues, margins and the outlook on the company.  </p>

Dingdang Health Technology Group (DDH HK), China’s largest product and service provider in the on-demand digital pharmacy industry has filed for an IPO to list its shares on the Hong Kong Stock Exchange. According to news media outlets, the company plans to raise about US$250-300m through the IPO.The ongoing regulatory overhaul in the Chinese tech sector and NMPA’s draft measures to increase supervision and regulate the country’s online pharmaceutical sales have impacted JD Health and other players in the market. WeDoctor who also offers online healthcare services in China filed for a HKEx listing in April this year and the company has not been able to progress yet with its planned IPO.In this insight, we take a look at DingDang Health’s business model, segments, revenues, margins and the outlook on the company.  

DingDang Health IPO: Solid Business Model and Strong Financials; Regulatory Environment Concerning

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

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

<div><p>The Asia Short Interest weekly looks at moves in market wide short interest and highlights movements in stock specific short interest across Hong Kong, Japan, Korea and Taiwan using the last available data published by the relevant authorities.</p></div><div><p>Hong Kong saw shorts rise on <a href="https://www.smartkarma.com/entities/meituan-dianping" target="_blank" data-smartkarma-citation="entities:26970:1" rel="noopener">Meituan (3690 HK)</a>, <a href="https://www.smartkarma.com/entities/li-ning-co-ltd" target="_blank" data-smartkarma-citation="entities:6047:1" rel="noopener">Li Ning (2331 HK)</a>, <a href="https://www.smartkarma.com/entities/china-merchants-bank-co-ltd-3388a037-4214-4997-b45d-520518cfdb57" target="_blank" data-smartkarma-citation="entities:10987:1" rel="noopener">China Merchants Bank H (3968 HK)</a>, <a href="https://www.smartkarma.com/entities/dongyue-group-ltd" target="_blank" data-smartkarma-citation="entities:20429:1" rel="noopener">Dongyue Group (189 HK)</a> and <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> while there was short covering on <a href="https://www.smartkarma.com/entities/alibaba-group" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba Group (9988 HK)</a>, <a href="https://www.smartkarma.com/entities/ping-an-insurance-grp-co-of-china-ltd" target="_blank" data-smartkarma-citation="entities:12880:1" rel="noopener">Ping An Insurance (H) (2318 HK)</a>, <a href="https://www.smartkarma.com/entities/sunny-optical-tech" target="_blank" data-smartkarma-citation="entities:13363:1" rel="noopener">Sunny Optical (2382 HK)</a>, <a href="https://www.smartkarma.com/entities/xiaomi-corp" target="_blank" data-smartkarma-citation="entities:24409:1" rel="noopener">Xiaomi Corp (1810 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>. Shorts increased in the Communication Services and Materials sectors while decreasing in the Financials, Information Technology and Health Care sectors.</p></div><div><p>In Japan, stocks increased on <a href="https://www.smartkarma.com/entities/pan-pacific-international-holdings-corporation" target="_blank" data-smartkarma-citation="entities:13475:1" rel="noopener">Pan Pacific International Holdings (7532 JP)</a>, <a href="https://www.smartkarma.com/entities/sekisui-house-ltd" target="_blank" data-smartkarma-citation="entities:4508:1" rel="noopener">Sekisui House (1928 JP)</a>, <a href="https://www.smartkarma.com/entities/toshiba-corp" target="_blank" data-smartkarma-citation="entities:637:1" rel="noopener">Toshiba Corp (6502 JP)</a>, <a href="https://www.smartkarma.com/entities/toyo-seikan-group-holdings-l" target="_blank" data-smartkarma-citation="entities:11858:1" rel="noopener">Toyo Seikan Group Holdings L (5901 JP)</a> and <a href="https://www.smartkarma.com/entities/canon-inc" target="_blank" data-smartkarma-citation="entities:1:1" rel="noopener">Canon Inc (7751 JP)</a> while there was short covering on <a href="https://www.smartkarma.com/entities/money-forward-inc" target="_blank" data-smartkarma-citation="entities:25919:1" rel="noopener">Money Forward (3994 JP)</a>, <a href="https://www.smartkarma.com/entities/eneos-holdings-inc" target="_blank" data-smartkarma-citation="entities:638:1" rel="noopener">ENEOS Holdings (5020 JP)</a>, <a href="https://www.smartkarma.com/entities/sbi-holdings-inc" target="_blank" data-smartkarma-citation="entities:10928:1" rel="noopener">SBI Holdings (8473 JP)</a>, <a href="https://www.smartkarma.com/entities/yamaha-corp" target="_blank" data-smartkarma-citation="entities:17841:1" rel="noopener">Yamaha Corp (7951 JP)</a> and <a href="https://www.smartkarma.com/entities/lasalle-logiport-reit" target="_blank" data-smartkarma-citation="entities:22658:1" rel="noopener">Lasalle Logiport REIT (3466 JP)</a>. Shorts increased in most sectors led by the Consumer Discretionary, Industrials, Real Estate, Information Technology and Materials stocks.</p></div><div><p>In Korea, shorts increased on <a href="https://www.smartkarma.com/entities/amorepacific-corp" target="_blank" data-smartkarma-citation="entities:20854:1" rel="noopener">Amorepacific Corp (090430 KS)</a>, <a href="https://www.smartkarma.com/entities/kakao-corp" target="_blank" data-smartkarma-citation="entities:15002:1" rel="noopener">Kakao Corp (035720 KS)</a>, <a href="https://www.smartkarma.com/entities/hmm-co-ltd" target="_blank" data-smartkarma-citation="entities:13494:1" rel="noopener">HMM Co., Ltd. (011200 KS)</a>, <a href="https://www.smartkarma.com/entities/lg-electronics-inc" target="_blank" data-smartkarma-citation="entities:8814:1" rel="noopener">LG Electronics (066570 KS)</a> and <a href="https://www.smartkarma.com/entities/shinpoong-pharmaceutical-co-ltd" target="_blank" data-smartkarma-citation="entities:7296:1" rel="noopener">Shinpoong Pharmaceutical (019170 KS)</a>   while shorts were covered on <a href="https://www.smartkarma.com/entities/samsung-electronics-co-ltd" target="_blank" data-smartkarma-citation="entities:191:1" rel="noopener">Samsung Electronics (005930 KS)</a>, <a href="https://www.smartkarma.com/entities/hanwha-solutions" target="_blank" data-smartkarma-citation="entities:8656:1" rel="noopener">Hanwha Solutions (009830 KS)</a>, <a href="https://www.smartkarma.com/entities/kt-corp" target="_blank" data-smartkarma-citation="entities:1112:1" rel="noopener">KT Corp (030200 KS)</a>, <a href="https://www.smartkarma.com/entities/lg-chem-ltd" target="_blank" data-smartkarma-citation="entities:3583:1" rel="noopener">LG Chem Ltd (051910 KS)</a> and <a href="https://www.smartkarma.com/entities/ncsoft-corp" target="_blank" data-smartkarma-citation="entities:5169:1" rel="noopener">NCSOFT Corp (036570 KS)</a>.</p></div><div><p>In Taiwan, shorts increased on <a href="https://www.smartkarma.com/entities/wan-hai-lines-ltd" target="_blank" data-smartkarma-citation="entities:14262:1" rel="noopener">Wan Hai Lines (2615 TT)</a>, <a href="https://www.smartkarma.com/entities/taiwan-semiconductor-manufacturing-company" target="_blank" data-smartkarma-citation="entities:11230:1" rel="noopener">TSMC (2330 TT)</a>, <a href="https://www.smartkarma.com/entities/fubon-financial-holding-co" target="_blank" data-smartkarma-citation="entities:11869:1" rel="noopener">Fubon Financial Holding Co (2881 TT)</a>, <a href="https://www.smartkarma.com/entities/mediatek-inc" target="_blank" data-smartkarma-citation="entities:772:1" rel="noopener">Mediatek Inc (2454 TT)</a> and <a href="https://www.smartkarma.com/entities/novatek-microelectronics-corp" target="_blank" data-smartkarma-citation="entities:10904:1" rel="noopener">Novatek Microelectronics Corp (3034 TT)</a>     while shorts covered on <a href="https://www.smartkarma.com/entities/united-microelectronics-corp" target="_blank" data-smartkarma-citation="entities:6450:1" rel="noopener">United Microelectronics Corp (2303 TT)</a>, <a href="https://www.smartkarma.com/entities/catcher-technology-co-ltd" target="_blank" data-smartkarma-citation="entities:4957:1" rel="noopener">Catcher Technology (2474 TT)</a>, <a href="https://www.smartkarma.com/entities/focaltech-systems-co-ltd" target="_blank" data-smartkarma-citation="entities:11240:1" rel="noopener">Focaltech Systems (3545 TT)</a>, <a href="https://www.smartkarma.com/entities/nuvoton-technology-corp" target="_blank" data-smartkarma-citation="entities:15913:1" rel="noopener">Nuvoton Technology (4919 TT)</a> and <a href="https://www.smartkarma.com/entities/chailease-holding-co-ltd" target="_blank" data-smartkarma-citation="entities:6579:1" rel="noopener">Chailease Holding (5871 TT)</a>.</p></div>

The Asia Short Interest weekly looks at moves in market wide short interest and highlights movements in stock specific short interest across Hong Kong, Japan, Korea and Taiwan using the last available data published by the relevant authorities.Hong Kong saw shorts rise on Meituan (3690 HK), Li Ning (2331 HK), China Merchants Bank H (3968 HK), Dongyue Group (189 HK) and Kuaishou Technology (1024 HK) while there was short covering on Alibaba Group (9988 HK), Ping An Insurance (H) (2318 HK), Sunny Optical (2382 HK), Xiaomi Corp (1810 HK) and JD Health (6618 HK). Shorts increased in the Communication Services and Materials sectors while decreasing in the Financials, Information Technology and Health Care sectors.In Japan, stocks increased on Pan Pacific International Holdings (7532 JP), Sekisui House (1928 JP), Toshiba Corp (6502 JP), Toyo Seikan Group Holdings L (5901 JP) and Canon Inc (7751 JP) while there was short covering on Money Forward (3994 JP), ENEOS Holdings (5020 JP), SBI Holdings (8473 JP), Yamaha Corp (7951 JP) and Lasalle Logiport REIT (3466 JP). Shorts increased in most sectors led by the Consumer Discretionary, Industrials, Real Estate, Information Technology and Materials stocks.In Korea, shorts increased on Amorepacific Corp (090430 KS), Kakao Corp (035720 KS), HMM Co., Ltd. (011200 KS), LG Electronics (066570 KS) and Shinpoong Pharmaceutical (019170 KS)   while shorts were covered on Samsung Electronics (005930 KS), Hanwha Solutions (009830 KS), KT Corp (030200 KS), LG Chem Ltd (051910 KS) and NCSOFT Corp (036570 KS).In Taiwan, shorts increased on Wan Hai Lines (2615 TT), TSMC (2330 TT), Fubon Financial Holding Co (2881 TT), Mediatek Inc (2454 TT) and Novatek Microelectronics Corp (3034 TT)     while shorts covered on United Microelectronics Corp (2303 TT), Catcher Technology (2474 TT), Focaltech Systems (3545 TT), Nuvoton Technology (4919 TT) and Chailease Holding (5871 TT).

Asia Shorts: Meituan, CMB, Li Ning, Sekisui, Toyo Seikan, Toshiba, Kakao, HMM, LGE, Wan Hai, TSMC

Overseas Chinese Equities, Aequitas Research

Ming Lu

Overseas Chinese Equities

Equity Bottom-Up

JD Health International  / Equity Bottom-Up

<ul class="">
<li>We believe JD Health will follow the accounting of JD.com, which Amazon originated.</li>
<li>We believe service is the main business, although product accounts for a large proportion in the nominal revenue.</li>
<li>The product plays a cornerstone role; therefore, it is fine to value the company by nominal revenue.</li>
<li>Service revenue growth is the important signal for the short-term stock price.</li>
</ul>


We believe JD Health will follow the accounting of JD.com, which Amazon originated.
We believe service is the main business, although product accounts for a large proportion in the nominal revenue.
The product plays a cornerstone role; therefore, it is fine to value the company by nominal revenue.
Service revenue growth is the important signal for the short-term stock price.


JD Health (6618 HK): Be Careful of Amazon Style Accounting

China

JD Health International Inc. operates drug stores. The Company retails Chinese and Western medicines, nutrition products, health care products, and other products. JD Health International markets its products throughout China.

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JD Health International (6618 HK)

Airdoc Technology IPO: Valuation Insights

Our valuation analysis suggests that the IPO price range is attractive. We also note that the mid-point of the IPO price range is a modest 5.7%...

Arun George

HK Short Interest: Short Spiked for BeiGene

We highlight in the latest SFC short aggregate report that the top five stocks by WoW increases in short value are Kuaishou, JD Health, BeiGene,...

Ke Yan, CFA, FRM

DingDang Health IPO: Solid Business Model and Strong Financials; Regulatory Environment Concerning

Though the on-demand digital pharmacy market is forecasted to see robust growth, the ongoing development in the Chinese online pharmaceutical...

Shifara Samsudeen, ACMA, CGMA

Asia Shorts: Meituan, CMB, Li Ning, Sekisui, Toyo Seikan, Toshiba, Kakao, HMM, LGE, Wan Hai, TSMC

The Insight looks at movements in short interest across HK, Japan, Korea and Taiwan stocks and highlights large increases/decreases in shorts to...

Brian Freitas

JD Health (6618 HK): Be Careful of Amazon Style Accounting

We believe JD Health will follow the accounting of JDc.om, which is the originated by Amazon. We believe service is the main business, although...

Ming Lu

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