China/Asia TMT

Shawn Yang

China growth and global non-US Internet equities

Blue Lotus Research Institute

Blue Lotus Research is a Hong Kong Type 4 Licensed investment advisory firm focusing on Chinese growth equities and global non-US Internet equities

Thematic (Sector/Industry)

<ul>
<li>We expect online gaming has a better performance: 1) improved content supply and 2) strong user demand for social interactions in top games like Tencent’s HOK and NetEase’s Egg Party.</li>
<li>We suggest that eCommerce and advertising have relatively weak performances in January because offline consumption enjoyed faster rebound and attracted users away from online platforms.</li>
<li>We are more positive about Tencent in C1Q23, and we expect that major ads platforms like Kuaishou, Baidu, Bili, iQIYI, and Weibo will have the fastest YoY growth in C2Q23.</li>
</ul>


We expect online gaming has a better performance: 1) improved content supply and 2) strong user demand for social interactions in top games like Tencent’s HOK and NetEase’s Egg Party.
We suggest that eCommerce and advertising have relatively weak performances in January because offline consumption enjoyed faster rebound and attracted users away from online platforms.
We are more positive about Tencent in C1Q23, and we expect that major ads platforms like Kuaishou, Baidu, Bili, iQIYI, and Weibo will have the fastest YoY growth in C2Q23.


China Internet CNY Holiday Update: Gaming Performed Better than Ads and ECom

Pan-Asia Index Flows & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Pan-Asia Index Flows & Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Event-Driven

Tencent Music Entertainment Group / Event-Driven

<ul>
<li>In this insight, we take a look at the potential index changes and the resultant capping flows for the <a href="https://www.smartkarma.com/entities/hang-seng-tech-index" target="_blank" data-smartkarma-citation="entities:31367:1" rel="noopener">Hang Seng Tech Index (HSTECH INDEX)</a> in March 2023.</li>
<li>According to our estimation, there could be two changes for the HSTECH in March 2023 and there could be one-way index flows of US$365mn.</li>
<li>The final index changes along with indicative capping and index weights could be published in Mid/Late-February 2023 and implemented in early-March 2023.</li>
</ul>


In this insight, we take a look at the potential index changes and the resultant capping flows for the Hang Seng Tech Index (HSTECH INDEX) in March 2023.
According to our estimation, there could be two changes for the HSTECH in March 2023 and there could be one-way index flows of US$365mn.
The final index changes along with indicative capping and index weights could be published in Mid/Late-February 2023 and implemented in early-March 2023.


Quiddity Flow Expectations HSTECH Mar 23: Two Index Changes Possible

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 analyze the weekly Hong Kong Connect flows with our data engine for holding position as of January 20th.</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 China Mobile, Tencent, Meituan, China Construction Bank, Hong Kong Exchanges And Clearing.</li>
</ul>


We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of January 20th.
The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.
We highlight flows for China Mobile, Tencent, Meituan, China Construction Bank, Hong Kong Exchanges And Clearing.


Hong Kong Connect Flows (Jan 20th): China Mobile, Tencent, Meituan, CCB, HKEX

Greater China Equity Long/Short Analyst

Eric Chen

Equity Bottom-Up

Alibaba Group Holding  / Equity Bottom-Up

<ul>
<li>Bullish sentiments doubled BABA share price post 20th Party congress, as investors look beyond a soft December quarter and focus on re-opening prospects and flashing regulatory green lights.</li>
<li>Expect single-Digit GMV growth, more disciplined OPEX and hence margin recovery to generate RMB180 billion non-GAAP net profit for BABA by FY25. Materializing fundamental recovery will support continued re-rating.</li>
<li>That said, we also see headwinds to multiple expansion and expect 18-20x PER (among lowest in sector) for FY25, implying 21%/28% compounded annual return over FY23-25.</li>
</ul>


Bullish sentiments doubled BABA share price post 20th Party congress, as investors look beyond a soft December quarter and focus on re-opening prospects and flashing regulatory green lights.
Expect single-Digit GMV growth, more disciplined OPEX and hence margin recovery to generate RMB180 billion non-GAAP net profit for BABA by FY25. Materializing fundamental recovery will support continued re-rating.
That said, we also see headwinds to multiple expansion and expect 18-20x PER (among lowest in sector) for FY25, implying 21%/28% compounded annual return over FY23-25.


Alibaba (BABA US): What Is Next After Strong Rally?

<ul>
<li>We analyzed the latest HK SFC report for aggregate short position as of Jan 13th.</li>
<li>Top short increases and decreases were tabulated for one week and four week period. </li>
<li>We highlight short changes in Ping An, Li Ning, Icbc, Jiumaojiu.</li>
</ul>


We analyzed the latest HK SFC report for aggregate short position as of Jan 13th.
Top short increases and decreases were tabulated for one week and four week period. 
We highlight short changes in Ping An, Li Ning, Icbc, Jiumaojiu.


HK Short Interest Weekly: Ping An, Li Ning, Icbc, Jiumaojiu

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)

China Internet CNY Holiday Update: Gaming Performed Better than Ads and ECom

Our recent channel check indicates that online gaming has a better performance than online ads and eCommerce during the Chinese New Year holiday....

Blue Lotus Research Institute

Quiddity Flow Expectations HSTECH Mar 23: Two Index Changes Possible

I see Tencent Music Entertainment (1698 HK) and Weibo Corp (9898 HK) as ADDs and Ming Yuan Cloud Group (909 HK) and AAC Technologies Holdings (2018...

Janaghan Jeyakumar, CFA

Hong Kong Connect Flows (Jan 20th): China Mobile, Tencent, Meituan, CCB, HKEX

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

Ke Yan, CFA, FRM

Alibaba (BABA US): What Is Next After Strong Rally?

We believe that materializing fundamental recovery to support continued re-rating of BABA after sentiment-driven rally. We expect over 20% CAGR...

Eric Chen

HK Short Interest Weekly: Ping An, Li Ning, Icbc, Jiumaojiu

We analyzed the latest HK SFC report for aggregate short position as of Jan 13th and highlight short interest changes in Ping An, Li Ning, Icbc,...

Ke Yan, CFA, FRM

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