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

WuXi XDC Cayman  / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/wuxi-xdc-cayman-inc" target="_blank" data-smartkarma-citation="entities:39917:1" rel="noopener">WuXi XDC Cayman Inc (1877628D HK)</a>, a leading contract research, development and manufacturing organization (CRDMO), is pre-marketing an HKEx IPO to raise US$500 million, according to press reports.   </li>
<li>WuXi XDC ranked No. 2 globally and No. 1 in China among CRDMO for antibody-drug conjugates and other bioconjugates in terms of revenue in 2022, according to Frost &amp; Sullivan.</li>
<li>The bull case rests on large addressable markets, market share gains, fast-paced revenue growth, strong revenue visibility, a solid balance sheet and ambitious capacity expansion plans.</li>
</ul>



WuXi XDC Cayman Inc (1877628D HK), a leading contract research, development and manufacturing organization (CRDMO), is pre-marketing an HKEx IPO to raise US$500 million, according to press reports.   
WuXi XDC ranked No. 2 globally and No. 1 in China among CRDMO for antibody-drug conjugates and other bioconjugates in terms of revenue in 2022, according to Frost &amp; Sullivan.
The bull case rests on large addressable markets, market share gains, fast-paced revenue growth, strong revenue visibility, a solid balance sheet and ambitious capacity expansion plans.


HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Bottom-Up

<ul>
<li>The market’s reaction to WuXi AppTec's 23H1 report was positive due to some improvements in performance, but we don’t think WuXi AppTec has reversed its predicament completely if look closely.</li>
<li>We deep dive the challenges/risks in macro environment faced by US/Europe. The orders WuXi AppTec received from MNCs can’t guarantee future growth momentum if the US cannot achieve "soft landing".</li>
<li>We advise investors not to be blinded by the high growth of CXO in the past since the prosperity of CXO industry may face continuous downward pressure in the future.</li>
</ul>


The market’s reaction to WuXi AppTec's 23H1 report was positive due to some improvements in performance, but we don’t think WuXi AppTec has reversed its predicament completely if look closely.
We deep dive the challenges/risks in macro environment faced by US/Europe. The orders WuXi AppTec received from MNCs can’t guarantee future growth momentum if the US cannot achieve "soft landing".
We advise investors not to be blinded by the high growth of CXO in the past since the prosperity of CXO industry may face continuous downward pressure in the future.


WuXi AppTec (2359.HK/603259.CH) 23H1 - Is It Time to Start Being Optimistic?

<ul>
<li>It seems that Mr Market was not satisfactory with WuXi AppTec’s 2022H1 performance. If excluding COVID-19 projects (which are regarded as a one-time increment), the performance growth was not high.</li>
<li>Considering that the CXO preliminary bid winning has declined largely in the US, domestic CXO would not begin to gradually reflect the slowdown of newly added orders until Q4.</li>
<li>We are concerned about WuXi AppTec's performance in 2023. As an old generation CXO, it's hard to achieve V-shaped rebound. So, 2022 is a good time to offload the Company.</li>
</ul>


It seems that Mr Market was not satisfactory with WuXi AppTec’s 2022H1 performance. If excluding COVID-19 projects (which are regarded as a one-time increment), the performance growth was not high.
Considering that the CXO preliminary bid winning has declined largely in the US, domestic CXO would not begin to gradually reflect the slowdown of newly added orders until Q4.
We are concerned about WuXi AppTec's performance in 2023. As an old generation CXO, it's hard to achieve V-shaped rebound. So, 2022 is a good time to offload the Company.


WuXi AppTec (603259.CH/2359.HK) 2022H1 - The Concerns Behind and the Outlook

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 143 stocks over the last week. The average A-H premium was 115.0% as of Jul 28th.</li>
<li>The average A-H premium changed by 0.8ppt week on week, led by information technology, communication services, energy and offset by health care, consumer staples.</li>
<li>We highlight weekly changes in A-H premium for China Vanke, CITIC Sec, China Pacific, BYD, CMOC, GF Sec, CICC.</li>
</ul>


We analyse the changes of A-H premium on 143 stocks over the last week. The average A-H premium was 115.0% as of Jul 28th.
The average A-H premium changed by 0.8ppt week on week, led by information technology, communication services, energy and offset by health care, consumer staples.
We highlight weekly changes in A-H premium for China Vanke, CITIC Sec, China Pacific, BYD, CMOC, GF Sec, CICC.


A-H Premium Weekly (Jul 28th): China Vanke, CITIC Sec, China Pacific, BYD, CMOC, GF Sec, CICC

<ul>
<li>We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of July 21st.</li>
<li>The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.</li>
<li>We estimate the inflows to be USD 2.1billion and highlight flows for Tencent, Hsbc.</li>
</ul>


We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of July 21st.
The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.
We estimate the inflows to be USD 2.1billion and highlight flows for Tencent, Hsbc.


Hong Kong Connect Flows (Jul 21st): Tencent, HSBC

China

Maccura Biotechnology Co., Ltd. specializes in the research, development, manufacturing, sales, and service of in-vitro diagnostic products. The Company provides biochemistry, immunity, rapid detection, blood, molecular diagnosis, pathology, raw materials, and more. Maccura Biotechnology conducts business in China.

Guangzhou Boji Medical & Biotechnological Co., Ltd. is an outsourcing drug research and development company. The Company provides pharmaceutical companies the ability to conduct its researches and developments at lower cost levels and offers support to bring drugs and devices to the Chinese market quicker.

Guangzhou Improve Medical Instruments Co., Ltd. researches, develops, and manufactures medical instruments. The Company's products include evacuated blood collection system, microbe specimen collection and transport, clinical testing reagent, equipment for clinical specimen testing & processing, etc.

Viva Biotech Holdings operates as a drug discovery platform. The Company provides target protein expression, structure researching, hit screening, drug candidate determination, and other services. Viva Biotech Holdings serves customers worldwide.

Austar Lifesciences Limited provides integrated engineering solutions with services and products for pharmaceutical manufacturers and research institutes in China and other emerging countries. The Company also manufactures, sells and distributes pharmaceutical equipment and life science consumables.

Sihuan Pharmaceutical Holdings Group Ltd. researches and develops cardiocerebral vascular drugs in China. The Company drugs address needs in the areas of anti-infective, metabolism, cardiovascular system, oncology and nervous system.

Consun Pharmaceutical Group Limited is a pharmaceutical company engaged in the research, manufacturing and sale of modern Chinese medicines and medical contrast medium in the People's Republic of China.

Hunan Er-kang Pharmaceutical Company Limited develops, produces and sells pharmaceutical products. The Company's main product include pharmaceutical excipients and antibiotic products.

Guizhou Bailing Group Pharmaceutical Co, Ltd. is a pharmaceutical company.  The Company's products include tablets, capsules, syrup, soft capsules, granules, pills, and powder.

Gz Bailing Group Pharm Co., Ltd. (002424 CH)

Zhejiang International Group Co., Ltd. mainly manufactures pharmaceutical products, including medicines, healthcare products, medical instruments, and pharmaceutical raw materials.  The Company also manufactures textile products, develops real estate, and provides technical services.

Standard BioTools Inc. offers technologies that help biomedical researchers develop medicines. The Company offers reliable and repeatable insights in health and disease using its proprietary mass cytometry and microfluidics technologies that help transform scientific discoveries into better patient outcomes.

PureTech Health plc operates as a healthcare company. The Company researches and licenses technology and videogames which are used as a treatment for neurological problems.

Ergomed plc provides clinical research, and drug development and safety services in the United Kingdom and rest of Europe, the Middle East, Africa, North America, Asia, and Australia. The company offers clinical development, trial management services, and pharmacovigilance services for pharmaceutical and generics companies, as well as small and mid-sized drug development companies. It focuses on various therapeutic areas, including oncology, neurology, and immunology, as well as the development of orphan drugs. The company?s clinical development services include study management, site management, study physician support, safety services, regulatory and quality management, clinical data management and biostatistics, and medical writing. It also provides late phase services, such as strategy and study design, medical training, regulatory consultancy, management of ISTs, full study management, publication management, site management, pharmacovigilance, tailored data capture solutions, REMS and RMPs, and medical information services; and co-development services for pharma and biotech companies. In addition, the company is involved in the studies of ultra-rare diseases, including infantile hypophsophatemia, paroxyzmal nocturnal haemoglobinuria, and primary hyperoxaluria; and the provision of the specialized site management model that allows smooth interaction of the sites and patient organizations, and advocacy groups. The company was formerly known as Ergomed Clinical Research Limited and changed its name to Ergomed plc in June 2014. Ergomed Plc was founded in 1997 and is headquartered in Guildford, the United Kingdom.

Quanterix Corporation develops ultra-sensitive detection systems for use in research and in-vitro diagnostics. The Company offers automated immunoassay technology for detection and quantification of biomarkers in in-vitro and companion diagnostics and blood screening. Quanterix provides its products in life science, oncology, and neurology research in the United States.

Pacific Biosciences of California Inc. has developed a novel approach to studying the synthesis and regulation of DNA, RNA and protein.  The Company's system enables real-time analysis of biomolecules with single molecule resolution.

Pacific Biosciences Of California (PACB US)

Shin Nippon Biomedical Laboratories Ltd is a contract research organization. The Company provides pre-clinical testing services in the pharmaceutical industry.

CMIC Holdings Co., Ltd. is a Contract Research Organization (CRO) who provides medical research related services mainly to pharmaceuticals and medical organizations. Its service ranges from strategy and regulatory consulting, clinical monitoring,and data management.

Selvita Spolka Akcyjna operates as a pharmaceutical company. The Company discovers drugs, as well as provides research and development services. Selvita serves customers worldwide.

Genfit is a biopharmaceutical company.  The Company researches treatments for cardiovascular, metabolic and inflammatory diseases, and age-linked neurodegenerative disorders.

Personalis, Inc. provides genomic sequencing and analytics solutions. The Company supports the development of personalized cancer vaccines and other next-generation cancer immunotherapies. Personalis serves customers worldwide.

Joinn Laboratories (China) Co., Ltd. operates as a medicines development company. The Company offers drug development, pharmaceutical analysis, pharmacologic testing, and other related services. Joinn Laboratories (China) also provides pesticide and medical device safety evaluation services.

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Joinn Laboratories China Lt (6127 HK)

WuXi XDC IPO: The Bull Case

The bull case rests on large addressable markets, market share gains, fast-paced revenue growth, strong revenue visibility, a solid balance sheet...

Arun George

WuXi AppTec (2359.HK/603259.CH) 23H1 - Is It Time to Start Being Optimistic?

WuXi AppTec's 23H1 results improved, but there're still risks haven't been fully released. If shareholders continue to reduce their holdings, why...

Xinyao (Criss) Wang

WuXi AppTec (603259.CH/2359.HK) 2022H1 - The Concerns Behind and the Outlook

In this insight last year, we expressed our concerns on WuXi AppTec's performance in 2023, when we think could be the performance low point. So,...

Xinyao (Criss) Wang

A-H Premium Weekly (Jul 28th): China Vanke, CITIC Sec, China Pacific, BYD, CMOC, GF Sec, CICC

We analyzed A-H premium changes in the past week and highlight A-H premium changes for China Vanke, CITIC Sec, China Pacific, BYD, CMOC, GF Sec, CICC.

Ke Yan, CFA, FRM

Hong Kong Connect Flows (Jul 21st): Tencent, HSBC

We analyzed southbound Hong Kong connect flows in the past week and highlight flows for Tencent Holdings Limited and, HSBC.

Ke Yan, CFA, FRM

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