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.

Equity Bottom-Up

<ul>
<li>China just announced game approval for May batch. The number of games approved is in-line with the pace of approval in recent month.</li>
<li>Pace of China game approval stays flattish, at a much slower pace than pre-tightening.</li>
<li>Both Tencent and Netease received approval for one game. We saw a pattern of approval rotation for the duo.</li>
</ul>


China just announced game approval for May batch. The number of games approved is in-line with the pace of approval in recent month.
Pace of China game approval stays flattish, at a much slower pace than pre-tightening.
Both Tencent and Netease received approval for one game. We saw a pattern of approval rotation for the duo.


Tencent/Netease: Game Approval Rotation in May

Overseas Chinese Equities, Aequitas Research

Ming Lu

Overseas Chinese Equities

<ul>
<li>The revenue growth rates of all business lines accelerated in 1Q23.</li>
<li>Operating losses shrank to RMB1.3 bn in 1Q23, less than RMB3 bn in two previous quarters.</li>
<li>We believe the stock has an upside of 66% for the yearend 2023.</li>
</ul>


The revenue growth rates of all business lines accelerated in 1Q23.
Operating losses shrank to RMB1.3 bn in 1Q23, less than RMB3 bn in two previous quarters.
We believe the stock has an upside of 66% for the yearend 2023.


Kuaishou (1024 HK): 1Q23, All Business Lines Accelerated

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.

<ul>
<li>
<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> ’s 1Q2023 earnings were above consensus estimates with the company reporting positive adj. EBITDA and adj. net profit during the quarter.</li>
<li>Operating profit margin of the domestic business further improved while the company managed to significantly reduce operating losses of the overseas business during the quarter.</li>
<li>Kuaishou also announced a small share buyback worth of HK$4bn which further affirms the company’s improving fundamentals and should help attract investors.</li>
</ul>



Kuaishou Technology (1024 HK) ’s 1Q2023 earnings were above consensus estimates with the company reporting positive adj. EBITDA and adj. net profit during the quarter.
Operating profit margin of the domestic business further improved while the company managed to significantly reduce operating losses of the overseas business during the quarter.
Kuaishou also announced a small share buyback worth of HK$4bn which further affirms the company’s improving fundamentals and should help attract investors.


Kuaishou 1Q2023: Upbeat Quarter with a Small Share Buyback

Greater China Equity Long/Short Analyst

Eric Chen

Alibaba Group Holding  / Equity Bottom-Up

<ul>
<li>Weaknesses of BABA stock and China tech sector in general post their strong earnings recovery for March quarter suggest market’s concerns centering around growth outlook.</li>
<li>BABA fundamental has tracked well to our projection since last November. P/E multiple contraction - which priced in too much pessimism - prevented our bullish call from materializing, for now.</li>
<li>We stick to our thesis that March quarter results set stage for BABA re-rating on sustained recovery, well-executed overhaul effectively unlocking value and investors’ renewed appetite for China assets.</li>
</ul>


Weaknesses of BABA stock and China tech sector in general post their strong earnings recovery for March quarter suggest market’s concerns centering around growth outlook.
BABA fundamental has tracked well to our projection since last November. P/E multiple contraction - which priced in too much pessimism - prevented our bullish call from materializing, for now.
We stick to our thesis that March quarter results set stage for BABA re-rating on sustained recovery, well-executed overhaul effectively unlocking value and investors’ renewed appetite for China assets.


Alibaba (BABA US): What It Takes for Re-Rating

Quantitative Analysis

<ul>
<li>We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of May 19th.</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 highlight flows for Tencent, China Construction Bank, China Mobile, Li Auto.</li>
</ul>


We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of May 19th.
The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.
We highlight flows for Tencent, China Construction Bank, China Mobile, Li Auto.


Hong Kong Connect Flows (May 19th): Tencent, China Construction Bank, China Mobile, Li Auto

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)

Tencent/Netease: Game Approval Rotation in May

We analyzed the game approval for May. Both Tencent and Netease received approval for one game. We see pattern of approval rotation between key...

Ke Yan, CFA, FRM

Kuaishou (1024 HK): 1Q23, All Business Lines Accelerated

The revenue growth rates of all business lines accelerated in 1Q23. Operating losses shrank. We believe the stock has an upside of 66% for the...

Ming Lu

Alibaba (BABA US): What It Takes for Re-Rating

Despite markets' focus on near-term growth weakness, we stick to our bullish call on BABA on sustained recovery, well-executed reorganization...

Eric Chen

Hong Kong Connect Flows (May 19th): Tencent, China Construction Bank, China Mobile, Li Auto

We analyzed southbound Hong Kong connect flows in the past week and highlight flows for Tencent, China Construction Bank, China Mobile, Li Auto.

Ke Yan, CFA, FRM

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Tencent/Netease: Game Approval Rotation in May

We analyzed the game approval for May. Both Tencent and Netease received approval for one game. We see pattern of approval rotation between key...

Ke Yan, CFA, FRM

Kuaishou (1024 HK): 1Q23, All Business Lines Accelerated

The revenue growth rates of all business lines accelerated in 1Q23. Operating losses shrank. We believe the stock has an upside of 66% for the...

Ming Lu

Kuaishou 1Q2023: Upbeat Quarter with a Small Share Buyback

IQ2023 earnings beat consensus with adj. EBITDA and an adj. net profit for the quarter. Domestic biz's OPM further improved and overseas losses...

Shifara Samsudeen, ACMA, CGMA

Alibaba (BABA US): What It Takes for Re-Rating

Despite markets' focus on near-term growth weakness, we stick to our bullish call on BABA on sustained recovery, well-executed reorganization...

Eric Chen

Hong Kong Connect Flows (May 19th): Tencent, China Construction Bank, China Mobile, Li Auto

We analyzed southbound Hong Kong connect flows in the past week and highlight flows for Tencent, China Construction Bank, China Mobile, Li Auto.

Ke Yan, CFA, FRM