Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Jiayuan Services Holdings Limited / Event-Driven

<ul>
<li>On the 21 May, <a href="https://www.smartkarma.com/entities/jinke-property-group-co-ltd" target="_blank" data-smartkarma-citation="entities:13291:1" rel="noopener">Jinke Property (000656 CH)</a> announced the forced sale of shares by its controlling shareholder. One day later, <a href="https://www.smartkarma.com/entities/jiayuan-international-group" target="_blank" data-smartkarma-citation="entities:22631:1" rel="noopener">Jiayuan International (2768 HK)</a> announced a similar event. </li>
<li>Jinke's 52.3%-owned <a href="https://www.smartkarma.com/entities/jinke-smart-services-group-co" target="_blank" data-smartkarma-citation="entities:29214:1" rel="noopener">Jinke Smart (9666 HK)</a> has now announced an agreement to acquire Jiayuan International's 73.56% stake in property service play <a href="https://www.smartkarma.com/entities/jiayuan-services-holdings-limited" target="_blank" data-smartkarma-citation="entities:29205:1" rel="noopener">Jiayuan Services Holdings (1153 HK)</a>. No price was announced.</li>
<li>In the past month, Jinke Property is down 24%, Jinke Smart 23%, Jiayuan International 54% and Jiayuan Services 80%. Jiayuan International and Jiayuan Services remain suspended.</li>
</ul>


On the 21 May, Jinke Property (000656 CH) announced the forced sale of shares by its controlling shareholder. One day later, Jiayuan International (2768 HK) announced a similar event. 
Jinke's 52.3%-owned Jinke Smart (9666 HK) has now announced an agreement to acquire Jiayuan International's 73.56% stake in property service play Jiayuan Services Holdings (1153 HK). No price was announced.
In the past month, Jinke Property is down 24%, Jinke Smart 23%, Jiayuan International 54% and Jiayuan Services 80%. Jiayuan International and Jiayuan Services remain suspended.


Jinke & Jiayuan: Pledged Shares And Leveraged Property Developers

APAC IPOs & Placements, Aequitas Research

Clarence Chu

APAC 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

Jinmao Property Services / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/jinmao-property-services" target="_blank" data-smartkarma-citation="entities:34170:1" rel="noopener">Jinmao Property Services (816 HK)</a> raised around US$105m in its Hong Kong IPO. </li>
<li>In our view, the firm doesn’t deserve to trade at a premium to peers given its weaker margins and slower growth in FY20. </li>
<li>In this note, we will look at the trading dynamics and current valuation.</li>
</ul>



Jinmao Property Services (816 HK) raised around US$105m in its Hong Kong IPO. 
In our view, the firm doesn’t deserve to trade at a premium to peers given its weaker margins and slower growth in FY20. 
In this note, we will look at the trading dynamics and current valuation.


Jinmao Property Services IPO Trading - Expect a Modest Debut with Low Liquidity

<ul>
<li>
<a href="https://www.smartkarma.com/entities/jinmao-property-services" target="_blank" data-smartkarma-citation="entities:34170:1" rel="noopener">Jinmao Property Services (JM HK)</a> is looking to raise around US$105m in its Hong Kong IPO.</li>
<li>At listing, it is asking for a steep premium and 82% of the deal size has already been taken up by cornerstones, not leaving a whole lot for other investors.</li>
<li>In this note, we will look at deal dynamics, assumptions, and share our thoughts on valuation.</li>
</ul>



Jinmao Property Services (JM HK) is looking to raise around US$105m in its Hong Kong IPO.
At listing, it is asking for a steep premium and 82% of the deal size has already been taken up by cornerstones, not leaving a whole lot for other investors.
In this note, we will look at deal dynamics, assumptions, and share our thoughts on valuation.


Jinmao Property Services IPO - Premium Asking Valuation and Cornerstones Took up 80% of Deal

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

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Quantitative Analysis

<ul>
<li>Stocks in the China Property Services industry have taken a beating over the last year on heightened regulatory fears, placements and potential stake sales by their large property developer holders.</li>
<li>The Hang Seng Property Service and Management Index (HSPSM) has underperformed the Hang Seng Mainland Property Index (HSMPI) over the last 3 months and there could be some recovery.</li>
<li>We take a look at some pair trades that could provide outperformance in the short-term with a lower level of risk.</li>
</ul>


Stocks in the China Property Services industry have taken a beating over the last year on heightened regulatory fears, placements and potential stake sales by their large property developer holders.
The Hang Seng Property Service and Management Index (HSPSM) has underperformed the Hang Seng Mainland Property Index (HSMPI) over the last 3 months and there could be some recovery.
We take a look at some pair trades that could provide outperformance in the short-term with a lower level of risk.


China Property Services: Pair Trades in a Beaten Down Industry

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.

Sichuan Languang Justbon Service Group / Event-Driven

<a href="https://www.smartkarma.com/entities/sichuan-languang-justbon-service-group-co-ltd-h" target="_blank" data-smartkarma-citation="entities:28337:1" rel="noopener">Sichuan Languang Justbon Service Group (2606 HK)</a> has despatched the composite document in relation to <a href="https://www.smartkarma.com/entities/country-garden-services-holdings-company-limited" target="_blank" data-smartkarma-citation="entities:27343:1" rel="noopener">Country Garden Services Holdings (6098 HK)</a> base and enhanced offer. Currently, Country Garden owns 71.17% of the outstanding shares comprising 66.99% of the domestic shares and 71.20% of the H Shares. The base offer is an unconditional mandatory cash offer for all the issued shares is HK$51.0571 per H-share (RMB42.8547 per domestic share. The enhanced share offer, which is payable only if the delisting is approved, is HK$54.3000 per H-share (RMB45.5768 per domestic share). Unsurprisingly, the IFA considers the base and enhanced offer to be fair and reasonable. We broadly agree with the IFA analysis with the exception that the peer multiple comparisons could be improved. The two key conditions for the delisting will be approval by at least 75% independent H-shareholders (&lt;10% of all independent H-shareholders rejection) and the satisfaction of the minimum acceptance condition (90% of H-shares held by independent H-shareholders). Satisfaction of the minimum acceptance condition is the key hurdle. We note the privatisation proposals for <a href="https://www.smartkarma.com/entities/beijing-jingneng-clean-energy-co-ltd" target="_blank" data-smartkarma-citation="entities:16316:1" rel="noopener">Beijing Jingneng Clean Energy (579 HK)</a> and <a href="https://www.smartkarma.com/entities/harbin-electric-co-ltd-h" target="_blank" data-smartkarma-citation="entities:11116:1" rel="noopener">Harbin Electric Co Ltd H (1133 HK)</a> have previously failed due to the inability to meet the 90% minimum acceptance condition.  <div class="content-highlight">Country Garden Services has bought itself some leeway by having the right to extend the closing date from 17 June to not later than 3 September. In theory, the extended time period should provide a greater chance of meeting the 90% threshold. At the last close, the gross spread to the enhanced offer price of HK$54.3000 stands at 4.9%.</div>

Sichuan Languang Justbon Service Group (2606 HK) has despatched the composite document in relation to Country Garden Services Holdings (6098 HK) base and enhanced offer. Currently, Country Garden owns 71.17% of the outstanding shares comprising 66.99% of the domestic shares and 71.20% of the H Shares. The base offer is an unconditional mandatory cash offer for all the issued shares is HK$51.0571 per H-share (RMB42.8547 per domestic share. The enhanced share offer, which is payable only if the delisting is approved, is HK$54.3000 per H-share (RMB45.5768 per domestic share). Unsurprisingly, the IFA considers the base and enhanced offer to be fair and reasonable. We broadly agree with the IFA analysis with the exception that the peer multiple comparisons could be improved. The two key conditions for the delisting will be approval by at least 75% independent H-shareholders (&lt;10% of all independent H-shareholders rejection) and the satisfaction of the minimum acceptance condition (90% of H-shares held by independent H-shareholders). Satisfaction of the minimum acceptance condition is the key hurdle. We note the privatisation proposals for Beijing Jingneng Clean Energy (579 HK) and Harbin Electric Co Ltd H (1133 HK) have previously failed due to the inability to meet the 90% minimum acceptance condition.  Country Garden Services has bought itself some leeway by having the right to extend the closing date from 17 June to not later than 3 September. In theory, the extended time period should provide a greater chance of meeting the 90% threshold. At the last close, the gross spread to the enhanced offer price of HK$54.3000 stands at 4.9%.

Languang Justbon’s Composite Document, IFA Opinion and Extended Closing Date

China

Jinke Smart Services Group Co., Ltd. provides property management services.

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Jinke Smart Services (9666 HK)

Jinke & Jiayuan: Pledged Shares And Leveraged Property Developers

With Jiayuan Services suspended, there is currently no trade. Jinke Smart is trading and is shortable but I don't have a firm opinion. Expect more...

David Blennerhassett

Jinmao Property Services IPO Trading - Expect a Modest Debut with Low Liquidity

Jinmao Property Services (816 HK) raised around US$105m in its Hong Kong IPO. In this note, we will look at the trading dynamics and current...

Clarence Chu

Jinmao Property Services IPO - Premium Asking Valuation and Cornerstones Took up 80% of Deal

Jinmao Property Services (JM HK) is looking to raise around US$105m in its Hong Kong IPO. In this note, we will look at deal dynamics, assumptions,...

Clarence Chu

China Property Services: Pair Trades in a Beaten Down Industry

Stocks from the China Property Management industry have been beaten down over the last year on increased regulation and potential stake sales by...

Brian Freitas

Languang Justbon’s Composite Document, IFA Opinion and Extended Closing Date

Satisfaction of the minimum acceptance condition is the key hurdle. At the last close, the gross spread to the enhanced offer price of HK$54.3000...

Arun George

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