Overseas Chinese Equities, Aequitas Research

Ming Lu

Overseas Chinese Equities

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 Bottom-Up

<ul>
<li>The gross margin improved 5 pp (percentage points) YoY and the operating margin improved 7 pp YoY in 2Q24.</li>
<li>In 2Q24, total revenue grew by 12% YoY, with the main business up by 22% YoY.</li>
<li>Three cross-sectional comparisons reach similar stock upsides about 100%. Buy.</li>
</ul>


The gross margin improved 5 pp (percentage points) YoY and the operating margin improved 7 pp YoY in 2Q24.
In 2Q24, total revenue grew by 12% YoY, with the main business up by 22% YoY.
Three cross-sectional comparisons reach similar stock upsides about 100%. Buy.


KS / Kuaishou (1024 HK): 2Q24, Significant Margin Improvement and 100% Stock Upside

<ul>
<li>We believe revenue will grow by 11% YoY and the company will make money for the fifth consecutive quarter in 2Q24.</li>
<li>We believe both adverting and e-commerce revenue will grow strongly in 2Q24.</li>
<li>We set an upside of 140% and a price target at HK$104 for the end of 2025. Buy.</li>
</ul>


We believe revenue will grow by 11% YoY and the company will make money for the fifth consecutive quarter in 2Q24.
We believe both adverting and e-commerce revenue will grow strongly in 2Q24.
We set an upside of 140% and a price target at HK$104 for the end of 2025. Buy.


KS/Kuaishou (1024 HK): 2Q24 Preview, 2-Digit Growth, 5th Profitable Quarter, and Significant Upside

External broker reports(aggregated public sources), CMB International

CMB International

External broker reports(aggregated public sources)

Incorporated in Hong Kong, supported by the mainland and targeting in global market, CMB International Capital Corporation Limited (“CMBI”) is an integrated financial institution providing comprehensive and professional services. As a wholly-owned subsidiary of China Merchants Bank ("CMB"), by leveraging on the Group’s synergy and coordination in domestic and overseas markets, as well as CMB’s strong resources and outstanding social reputation, CMBI and its subsidiaries have been actively implementing diversified business strategies and set up an overall layout of main business segments including Corporate Finance, Asset Management, Wealth Management, Global Markets and Structured Finance, etc. Adhering to the philosophy of “being clients oriented and increasing our own values by the way of creating value for clients”, CMBI endeavors to provide quality and integrated financial services to institutional, corporate and individual customers both domestic and overseas including Hong Kong IPO sponsorship and underwriting, share placement and rights issue for listed companies, financial advisors, bonds issuance services, asset management, direct investment, wealth management, equity sales and trading, etc.

<ul><li>During the 618 promotion of 2024, Kuaishou emphasized more on good products at low price, with simpler approach and extended period.</li><li>Pan shelf-based ecommerce performed well, with orders/paying users +65%/57% YoY.</li><li>We estimate its GMV share from pan shelf-based ecommerce to be &gt;25%, and 2Q24E ecommerce growth would be intact (forecasting GMV/other services revenue +25%/24% YoY). </li></ul><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

During the 618 promotion of 2024, Kuaishou emphasized more on good products at low price, with simpler approach and extended period.Pan shelf-based ecommerce performed well, with orders/paying users +65%/57% YoY.We estimate its GMV share from pan shelf-based ecommerce to be &gt;25%, and 2Q24E ecommerce growth would be intact (forecasting GMV/other services revenue +25%/24% YoY). Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Kuaishou (1024 HK) - Shelf-Based Ecommerce Outperformed in 618

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

<ul>
<li>Giant Biogene was listed in Hong Kong IPO in 2022. It has done well since and is now trading 45% above its IPO price, but its still cheap.</li>
<li>GB is a leader in the bioactive ingredient-based professional skin treatment product industry in China.</li>
<li>In this note, we will talk about the company’s past performance and future prospects.</li>
</ul>


Giant Biogene was listed in Hong Kong IPO in 2022. It has done well since and is now trading 45% above its IPO price, but its still cheap.
GB is a leader in the bioactive ingredient-based professional skin treatment product industry in China.
In this note, we will talk about the company’s past performance and future prospects.


2024 High Conviction - Giant Biogene - Growth Rate Keeps Moving Higher

Event-Driven

<ul>
<li>Multiple new agencies have been reporting that <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent (700 HK)</a> plans to trim its investment portfolio over the remainder of the year. </li>
<li>The reports have been coming in since the second half of the year and the company has been duly denying these rumors.</li>
<li>In this note, we look at Tencent’s shareholding in various companies to try and gauge which ones it could sell out of and how.</li>
</ul>


Multiple new agencies have been reporting that Tencent (700 HK) plans to trim its investment portfolio over the remainder of the year. 
The reports have been coming in since the second half of the year and the company has been duly denying these rumors.
In this note, we look at Tencent’s shareholding in various companies to try and gauge which ones it could sell out of and how.


Tencent Investee Selldown - The US$120bn Global Overhang

China

Kuaishou Technology operates as a content community and social platform. The Company helps users create, upload and watch short videos on mobile devices. Kuaishou Technology offers services worldwide.

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Kuaishou Technology (1024 HK)

KS / Kuaishou (1024 HK): 2Q24, Significant Margin Improvement and 100% Stock Upside

The gross margin improved 5 pp (percentage points) YoY and the operating margin improved 7 pp YoY in 2Q24. In 2Q24, total revenue grew by 12% YoY,...

Ming Lu

KS/Kuaishou (1024 HK): 2Q24 Preview, 2-Digit Growth, 5th Profitable Quarter, and Significant Upside

We believe revenue will grow by 11% YoY and the company will be profitable for the fifth quarter in 2Q24. We believe both adverting and e-commerce...

Ming Lu

Kuaishou (1024 HK) - Shelf-Based Ecommerce Outperformed in 618

During the 618 promotion of 2024, Kuaishou emphasized more on good products at low price, with simpler approach and extended period.

CMB International

2024 High Conviction - Giant Biogene - Growth Rate Keeps Moving Higher

Giant Biogene was listed in Hong Kong IPO in 2022. It has done well since and is now trading 45% above its IPO price, but its still cheap.

Sumeet Singh

Tencent Investee Selldown - The US$120bn Global Overhang

There have been multiple reports that Tencent (700 HK) plans to trim its investment portfolio over the remainder of the year. We look at Tencent's...

Sumeet Singh

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