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 analyzed the latest HK SFC report for aggregate short position as of Jan 6th.</li>
<li>Top short increases and decreases were tabulated for one week and four week period. </li>
<li>We highlight short changes in Tencent, Baba, Cm Bank, Bidu, Meituan, HSBC, Differ Gp Auto, Li Auto-W.</li>
</ul>


We analyzed the latest HK SFC report for aggregate short position as of Jan 6th.
Top short increases and decreases were tabulated for one week and four week period. 
We highlight short changes in Tencent, Baba, Cm Bank, Bidu, Meituan, HSBC, Differ Gp Auto, Li Auto-W.


HK Short Interest Weekly: Tencent, Baba, CMB, Bidu, Meituan, HSBC, Differ, Li Auto

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

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Event-Driven

<ul>
<li>End December was the end of the review cutoff for a lot of indices that will rebalance within the next couple of months.</li>
<li>
<a href="https://www.smartkarma.com/entities/pexa-group-ltd" target="_blank" data-smartkarma-citation="entities:34716:1" rel="noopener">PEXA Group (PXA AU)</a> replaces <a href="https://www.smartkarma.com/entities/pendal-group-ltd" target="_blank" data-smartkarma-citation="entities:15795:1" rel="noopener">Pendal Group (PDL AU)</a> in the <a href="https://www.smartkarma.com/entities/s-p-asx-200" target="_blank" data-smartkarma-citation="entities:22901:1" rel="noopener">S&amp;P/ASX 200 (AS51 INDEX)</a> at the close on 12 January.</li>
<li>There were big outflows from Hong Kong and China focused ETFs led by <a href="https://www.smartkarma.com/entities/hang-seng-china-enterprises-index-etf" target="_blank" data-smartkarma-citation="entities:25:1" rel="noopener">Hang Seng H Share Index ETF (2828 HK)</a> and <a href="https://www.smartkarma.com/entities/tracker-fund-of-hong-kong-ltd" target="_blank" data-smartkarma-citation="entities:29257:1" rel="noopener">Tracker Fund of Hong Kong Ltd (2800 HK)</a>.</li>
</ul>


End December was the end of the review cutoff for a lot of indices that will rebalance within the next couple of months.

PEXA Group (PXA AU) replaces Pendal Group (PDL AU) in the S&amp;P/ASX 200 (AS51 INDEX) at the close on 12 January.
There were big outflows from Hong Kong and China focused ETFs led by Hang Seng H Share Index ETF (2828 HK) and Tracker Fund of Hong Kong Ltd (2800 HK).


Index Rebalance & ETF Flow Recap: HSCEI, HSTECH, HSI, HSCI, KS200, KQ150, CSI300, SENSEX, LQ45, PSEi

<ul>
<li>We expect at least one change to 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 - though there could be another change as well.</li>
<li>Changes to the index handling for Dual Primary Listings should result in an increase in free float and passive inflows to <a href="https://www.smartkarma.com/entities/li-auto-inc-3dbe6187-544f-40dd-b9f9-72fba9c0110e" target="_blank" data-smartkarma-citation="entities:33811:1" rel="noopener">Li Auto (2015 HK)</a> and <a href="https://www.smartkarma.com/entities/xpeng-inc-4cc65854-d10c-4d20-bf7e-ca0e016715ff" target="_blank" data-smartkarma-citation="entities:33772:1" rel="noopener">XPeng (9868 HK)</a>. </li>
<li>Estimated one-way turnover is 5.83% resulting in a one-way trade of HK$4.87bn and this is mainly driven by float and capping changes.</li>
</ul>


We expect at least one change to the Hang Seng Tech Index (HSTECH INDEX) in March - though there could be another change as well.
Changes to the index handling for Dual Primary Listings should result in an increase in free float and passive inflows to Li Auto (2015 HK) and XPeng (9868 HK). 
Estimated one-way turnover is 5.83% resulting in a one-way trade of HK$4.87bn and this is mainly driven by float and capping changes.


HSTECH Index Rebalance Preview (March): Handling Treatment Changes Lead to High Turnover

<ul>
<li>We expect one change to the <a href="https://www.smartkarma.com/entities/hang-seng-china-enterprises-index" target="_blank" data-smartkarma-citation="entities:22900:1" rel="noopener">Hang Seng China Enterprises Index (HSCEI INDEX)</a> in March, though there is a possibility of a second change.</li>
<li>The change in the index handling treatment for Secondary Listings and Dual Primary Listings will also result in some big float changes resulting in inflows to some stocks.</li>
<li>If there are two changes to the index, estimated one-way turnover is 2.39% resulting in a one-way trade of HK$1,536m.</li>
</ul>


We expect one change to the Hang Seng China Enterprises Index (HSCEI INDEX) in March, though there is a possibility of a second change.
The change in the index handling treatment for Secondary Listings and Dual Primary Listings will also result in some big float changes resulting in inflows to some stocks.
If there are two changes to the index, estimated one-way turnover is 2.39% resulting in a one-way trade of HK$1,536m.


HSCEI Index Rebalance Preview: Handling Treatment & Changes in March

<ul>
<li>We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of December 23rd.</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 that the outflow last week was USD 258m. Tencent, Kuaishou led the outflows.</li>
</ul>


We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of December 23rd.
The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.
We estimate that the outflow last week was USD 258m. Tencent, Kuaishou led the outflows.


Hong Kong Connect Flows (Dec 23rd): Tencent, Kuaishou

China

Li Auto Inc. manufactures automobiles. The Company designs, develops, and sells smart new energy electric sport utility vehicles. Li Auto conducts businesses in China.

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Li Auto (2015 HK)

HK Short Interest Weekly: Tencent, Baba, CMB, Bidu, Meituan, HSBC, Differ, Li Auto

We analyzed the latest HK SFC report for aggregate short position as of Jan 6th and highlight short interest changes in Tencent, Baba, CMB, Bidu,...

Ke Yan, CFA, FRM

Index Rebalance & ETF Flow Recap: HSCEI, HSTECH, HSI, HSCI, KS200, KQ150, CSI300, SENSEX, LQ45, PSEi

This recap highlights Insights covering Asian index rebalances (announcements/ forecasts/ IPO Fast Entry/ M&A driven changes). We also highlight...

Brian Freitas

HSTECH Index Rebalance Preview (March): Handling Treatment Changes Lead to High Turnover

Index handling changes will lead to high turnover driven by increased float on Li Auto and Xpeng. There will be small inflows on the potential adds...

Brian Freitas

HSCEI Index Rebalance Preview: Handling Treatment & Changes in March

There should be at least 1 index change in March, but there could be 2. Changes in index handling treatment will result in free float changes....

Brian Freitas

Hong Kong Connect Flows (Dec 23rd): Tencent, Kuaishou

We analyzed the Hong Kong Connect Scheme for last week and highlight flows for Tencent (700 HK), Kuaishou Technology (1024 HK).

Ke Yan, CFA, FRM

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