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

<ul>
<li>
<a href="https://www.smartkarma.com/entities/vinfast" target="_blank" data-smartkarma-citation="entities:36550:1" rel="noopener">VinFast (1905332D VN)</a>, a Vietnamese EV manufacturer and a majority-owned affiliate of <a href="https://www.smartkarma.com/entities/vingroup-jsc" target="_blank" data-smartkarma-citation="entities:13213:1" rel="noopener">Vingroup Jsc (VIC VN)</a>, has filed for a US$1.0 billion IPO to list on Nasdaq.</li>
<li>In <em><strong><a href="https://www.smartkarma.com/insights/vinfast-auto-ipo-the-bull-case" target="_blank" data-smartkarma-citation="insights:85901" rel="noopener">VinFast Auto IPO: The Bull Case</a>,</strong></em> we highlighted the key elements of the bull case. In this note, we outline the bear case.  </li>
<li>The key elements of the bear case are a lack of brand recognition, questionable ability to generate profits, the precarious state of financing and liability exposure to ICE vehicles.</li>
</ul>



VinFast (1905332D VN), a Vietnamese EV manufacturer and a majority-owned affiliate of Vingroup Jsc (VIC VN), has filed for a US$1.0 billion IPO to list on Nasdaq.
In VinFast Auto IPO: The Bull Case, we highlighted the key elements of the bull case. In this note, we outline the bear case.  
The key elements of the bear case are a lack of brand recognition, questionable ability to generate profits, the precarious state of financing and liability exposure to ICE vehicles.


<ul>
<li>
<a href="https://www.smartkarma.com/entities/vinfast" target="_blank" data-smartkarma-citation="entities:36550:1" rel="noopener">VinFast (1905332D VN)</a>, a Vietnamese EV (electric vehicle) manufacturer and a majority-owned affiliate of <a href="https://www.smartkarma.com/entities/vingroup-jsc" target="_blank" data-smartkarma-citation="entities:13213:1" rel="noopener">Vingroup Jsc (VIC VN)</a>, has filed for a US$1.0 billion IPO to list on Nasdaq.</li>
<li>VinFast is in the middle of a transition from an ICE to a pure-play EV manufacturer. VF 8, its second EV SUV, will be delivered in the US in 4Q22. </li>
<li>The key elements of the bull case rest on a credible EV roadmap, speed-to-market, solid consumer interest and models with attractive range-to-price ratios and total cost of ownership.</li>
</ul>



VinFast (1905332D VN), a Vietnamese EV (electric vehicle) manufacturer and a majority-owned affiliate of Vingroup Jsc (VIC VN), has filed for a US$1.0 billion IPO to list on Nasdaq.
VinFast is in the middle of a transition from an ICE to a pure-play EV manufacturer. VF 8, its second EV SUV, will be delivered in the US in 4Q22. 
The key elements of the bull case rest on a credible EV roadmap, speed-to-market, solid consumer interest and models with attractive range-to-price ratios and total cost of ownership.


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>The December rebalance of the <a href="https://www.smartkarma.com/entities/hong-kong-hang-seng-index" target="_blank" data-smartkarma-citation="entities:22899:1" rel="noopener">HSI INDEX</a>, <a href="https://www.smartkarma.com/entities/hang-seng-china-enterprises-index" target="_blank" data-smartkarma-citation="entities:22900:1" rel="noopener">HSCEI INDEX</a> and <a href="https://www.smartkarma.com/entities/hang-seng-tech-index" target="_blank" data-smartkarma-citation="entities:31367:1" rel="noopener">HSTECH INDEX</a> takes place at the close today. One-way flow is estimated at HK$8.4bn.</li>
<li>There are 3 adds for the <a href="https://www.smartkarma.com/entities/hong-kong-hang-seng-index" target="_blank" data-smartkarma-citation="entities:22899:1" rel="noopener">HSI INDEX</a> and 4 adds/ 4 deletes for the <a href="https://www.smartkarma.com/entities/hang-seng-china-enterprises-index" target="_blank" data-smartkarma-citation="entities:22900:1" rel="noopener">HSCEI INDEX</a>. There are float changes for a few stocks as well as capping changes. </li>
<li>There is excess volume on most adds/deletes post announcement and short interest has also picked up significantly.</li>
</ul>


The December rebalance of the HSI INDEX, HSCEI INDEX and HSTECH INDEX takes place at the close today. One-way flow is estimated at HK$8.4bn.
There are 3 adds for the HSI INDEX and 4 adds/ 4 deletes for the HSCEI INDEX. There are float changes for a few stocks as well as capping changes. 
There is excess volume on most adds/deletes post announcement and short interest has also picked up significantly.


Hang Seng Indexes: Rebalances Today; Recent Trading Data

China Specialist, Auto and Industrial Specialist

Victoria Li

Thematic (Sector/Industry)

<ul>
<li>Despite the remaining EV subsidies finishing next year, we expect demand to be relatively unimpacted</li>
<li>Battery supply issues should be eased with Covid lockdowns easing and new capacity expansions</li>
<li>&gt;100 new models due for launch in 2023E vs ~70 in 2022 and will keep potential customers and market excited in the sector</li>
</ul>


Despite the remaining EV subsidies finishing next year, we expect demand to be relatively unimpacted
Battery supply issues should be eased with Covid lockdowns easing and new capacity expansions
&gt;100 new models due for launch in 2023E vs ~70 in 2022 and will keep potential customers and market excited in the sector


China NEV Outlook: Life After Subsidies Is Still Beautiful

<ul>
<li>The December rebalance of the HSI, HSCEI and HSTECH indices will use today's closing prices to cap the index constituents at 8%. This will lead to large flows.</li>
<li>The largest inflows will be on <a href="https://www.smartkarma.com/entities/alibaba-group" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba Group</a>, <a href="https://www.smartkarma.com/entities/haier-smart-home-co-ltd-b3ef445f-0f54-4586-8c58-9073de98d60e" target="_blank" data-smartkarma-citation="entities:31105:1" rel="noopener">Haier Smart Home</a>, <a href="https://www.smartkarma.com/entities/beijing-kuaishou-technology-co-ltd" target="_blank" data-smartkarma-citation="entities:29725:1" rel="noopener">Kuaishou Technology</a>, <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</a>, <a href="https://www.smartkarma.com/entities/petrochina-co-ltd-h" target="_blank" data-smartkarma-citation="entities:262:1" rel="noopener">PetroChina</a>, <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent</a>, <a href="https://www.smartkarma.com/entities/jd-com-inc" target="_blank" data-smartkarma-citation="entities:29043:1" rel="noopener">JD.com</a>, <a href="https://www.smartkarma.com/entities/china-resources-mixc-lifestyle-services" target="_blank" data-smartkarma-citation="entities:29285:1" rel="noopener">China Resources Mixc Lifestyle Services</a> and <a href="https://www.smartkarma.com/entities/tingyi-cayman-islands-holding-corp" target="_blank" data-smartkarma-citation="entities:14016:1" rel="noopener">Tingyi Holding</a>.</li>
<li>The largest outflows will be on <a href="https://www.smartkarma.com/entities/semiconductor-manufacturing-international-corp-smic" target="_blank" data-smartkarma-citation="entities:14231:1" rel="noopener">SMIC</a>, <a href="https://www.smartkarma.com/entities/netease" target="_blank" data-smartkarma-citation="entities:29030:1" rel="noopener">NetEase</a>, <a href="https://www.smartkarma.com/entities/aia-group-ltd" target="_blank" data-smartkarma-citation="entities:14895:1" rel="noopener">AIA Group</a>, <a href="https://www.smartkarma.com/entities/hsbc-holdings-plc" target="_blank" data-smartkarma-citation="entities:516:1" rel="noopener">HSBC Holdings</a>, <a href="https://www.smartkarma.com/entities/china-construction-bank-h" target="_blank" data-smartkarma-citation="entities:45:1" rel="noopener">China Construction Bank</a>, <a href="https://www.smartkarma.com/entities/alibaba-health-information-technology-ltd" target="_blank" data-smartkarma-citation="entities:453:1" rel="noopener">Alibaba Health Information Technology</a>, <a href="https://www.smartkarma.com/entities/innovent-biologics-inc" target="_blank" data-smartkarma-citation="entities:27452:1" rel="noopener">Innovent Biologics</a>, <a href="https://www.smartkarma.com/entities/china-mobile-ltd" target="_blank" data-smartkarma-citation="entities:27:1" rel="noopener">China Mobile</a>, <a href="https://www.smartkarma.com/entities/ping-an-insurance-grp-co-of-china-ltd" target="_blank" data-smartkarma-citation="entities:12880:1" rel="noopener">Ping An Insurance</a> and <a href="https://www.smartkarma.com/entities/industrial-and-commercial-bank-of-china-limited" target="_blank" data-smartkarma-citation="entities:1119:1" rel="noopener">ICBC</a>.</li>
</ul>


The December rebalance of the HSI, HSCEI and HSTECH indices will use today's closing prices to cap the index constituents at 8%. This will lead to large flows.
The largest inflows will be on Alibaba Group, Haier Smart Home, Kuaishou Technology, Li Auto, PetroChina, Tencent, JD.com, China Resources Mixc Lifestyle Services and Tingyi Holding.
The largest outflows will be on SMIC, NetEase, AIA Group, HSBC Holdings, China Construction Bank, Alibaba Health Information Technology, Innovent Biologics, China Mobile, Ping An Insurance and ICBC.


HSI, HSCEI, HSTECH: Rebalance Flows Post Capping (Dec 2022)

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)

VinFast Auto IPO: The Bear Case

The key elements of the bear case are a lack of brand recognition, questionable ability to generate profits, the precarious state of financing and...

Arun George

VinFast Auto IPO: The Bull Case

The key elements of the bull case rest on a credible EV roadmap, speed-to-market, solid consumer interest and models with attractive range-to-price...

Arun George

Hang Seng Indexes: Rebalances Today; Recent Trading Data

The December rebalance of the HSI, HSCEI & HSTECH is at the close today. One-way flow is estimated at HK$8.4bn. Volumes and short interest have...

Brian Freitas

China NEV Outlook: Life After Subsidies Is Still Beautiful

Despite the remaining EV subsidies finishing next year, we expect demand to be relatively unimpacted. Battery supply issues should be eased with...

Victoria Li

HSI, HSCEI, HSTECH: Rebalance Flows Post Capping (Dec 2022)

The December rebalance of the HSI, HSCEI, HSTECH indices will use today's close prices for capping. The one-way trade across all stocks across the...

Brian Freitas

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