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 announced game approval for the December batch. The number of games approved remained at a higher level than 2023.</li>
<li>The pace of China game approval appears to have accelerated to the same level as pre-tightening. There have been 47% more games approved in 2024 compared to 2023.</li>
<li>Of the companies that we are monitoring, Netease got one approval.</li>
</ul>


China announced game approval for the December batch. The number of games approved remained at a higher level than 2023.
The pace of China game approval appears to have accelerated to the same level as pre-tightening. There have been 47% more games approved in 2024 compared to 2023.
Of the companies that we are monitoring, Netease got one approval.


Tencent/Netease: Game Approval Trending up but Only One Approval for Netease

Independent research on the U.S. markets, Baptista Research

Baptista Research

Independent research on the U.S. markets

Baptista Research is an independent financial research house focused on the U.S. markets. We provide equity research as well as credit research reports on the top-listed U.S. companies with most of our focus on technology, consumer goods and services, automobiles, industrials, oil and gas, pharma, and healthcare. Our research has served more than 3000 institutional investors including mutual funds, hedge funds, banks, family offices, and various buy-side firms. We operate a research subscription service where institutions, as well as retail investors, can have priority access to all our research. We also have a wide distribution of our research reports across some of the top global financial platforms. Apart from equity research and credit research, we also provide advisory services with respect to mergers & acquisitions (M&A), private equity/ venture capital fundraising, valuation reports, and investment management services for corporates.
Baptista Research is owned and managed by Ishan Majumdar, an ex-Venture Capitalist/ Investment Banker, a Chartered Accountant, and a Masters’ degree holder in Management from HEC Paris. Ishan has nearly a decade of experience in Mergers and Acquisitions, Leveraged Buyouts (LBOs), Venture Capital Investing, Corporate Strategy, and Valuation in front-office roles at the likes of BNP Paribas CIB, Credit Agricole CIB, Groupe Danone, and TIW Private Equity. He has worked on and closed multiple acquisition deals, leveraged buyouts, and start-up investment transactions.

<ul><li>NetEase's recent quarterly earnings report demonstrates a mixed performance characterized by both promising growth areas and some challenges.</li><li>The company's overall financial health remains strong, supported by diversified business operations in gaming, education, music, and other innovative ventures.</li><li>In the gaming segment, NetEase achieved solid results, with total online games net revenue reaching approximately RMB 20 billion, indicating substantial year-over-year and quarter-over-quarter growth in PC games.</li></ul>

NetEase's recent quarterly earnings report demonstrates a mixed performance characterized by both promising growth areas and some challenges.The company's overall financial health remains strong, supported by diversified business operations in gaming, education, music, and other innovative ventures.In the gaming segment, NetEase achieved solid results, with total online games net revenue reaching approximately RMB 20 billion, indicating substantial year-over-year and quarter-over-quarter growth in PC games.

NetEase Inc.: The Expansion of Gaming Portfolio & Global Reach & Other Major Drivers

Blue Lotus Non US Internet research, Blue Lotus Research Institute

Ying Pan

Blue Lotus Non US Internet research

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

<ul>
<li>NetEase reported C3Q24 revenue, GAAP operating profit and GAAP net income in line, (3.6%) and (5.3%) vs. our estimates, and in line, (4.4%) and (5.0%) vs. consensus. </li>
<li>Mobile game revenue decline is less a concern due to imminent pipeline launches, but PC game’s significantly beat is a positive surprise. </li>
<li>We raised the TP to US$118 for the better outlook of new game launches.</li>
</ul>


NetEase reported C3Q24 revenue, GAAP operating profit and GAAP net income in line, (3.6%) and (5.3%) vs. our estimates, and in line, (4.4%) and (5.0%) vs. consensus. 
Mobile game revenue decline is less a concern due to imminent pipeline launches, but PC game’s significantly beat is a positive surprise. 
We raised the TP to US$118 for the better outlook of new game launches.


[NetEase, Inc. (NTES US, BUY, TP US$118) TP Change]: Growth Rebounds Ahead from Both PC and Mobile

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>NetEase announced 3Q24 financial results: total revenue declined by 4% YoY to RMB26.2bn, largely in line with Bloomberg consensus estimate; operating profit was down by 5% YoY to RMB7.15bn, in line with consensus estimate of RMB7.22bn.</li><li>3Q24 revenue was down YoY, mainly due to the high-base effect and softer-than-expected performance of certain new game titles.</li><li>Looking ahead, we expect the launch of Marvel Rivals and Where Winds Meet in December will be the key catalysts to watch, the performance of which shall be the key drivers of NetEase valuation and revenue growth in FY25E. </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>

NetEase announced 3Q24 financial results: total revenue declined by 4% YoY to RMB26.2bn, largely in line with Bloomberg consensus estimate; operating profit was down by 5% YoY to RMB7.15bn, in line with consensus estimate of RMB7.22bn.3Q24 revenue was down YoY, mainly due to the high-base effect and softer-than-expected performance of certain new game titles.Looking ahead, we expect the launch of Marvel Rivals and Where Winds Meet in December will be the key catalysts to watch, the performance of which shall be the key drivers of NetEase valuation and revenue growth in FY25E. 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.

NetEase (NTES US) - Inline 3Q24 Results; Eyes on New Game Launch in December

<ul>
<li>We expect NTES to report C3Q24 revenue, GAAP operating profit and GAAP net income in (3.8%), in-line and in-line vs. consensus. </li>
<li>Main reason for the revenue miss was product aging in &lt;Justice Mobile&gt; and &lt;Eggy Party&gt; offsetting &lt;Naraka Mobile&gt;;</li>
<li>We cut TP from US$122 to US$110 to reflect the downward pressure from product aging to sustain, but maintaining a BUY rating due to the promising pipeline. </li>
</ul>


We expect NTES to report C3Q24 revenue, GAAP operating profit and GAAP net income in (3.8%), in-line and in-line vs. consensus. 
Main reason for the revenue miss was product aging in &lt;Justice Mobile&gt; and &lt;Eggy Party&gt; offsetting &lt;Naraka Mobile&gt;;
We cut TP from US$122 to US$110 to reflect the downward pressure from product aging to sustain, but maintaining a BUY rating due to the promising pipeline. 


[NetEase, Inc. (NTES US, BUY, TP US$110) TP Change]: C3Q24 Preview: Revenue Miss but Is Temporary

China

NetEase, Inc. is an Internet technology company that develops applications, services and other Internet technologies in China. The Company's core businesses consist of email service, web portal and online entertainment, including online gaming services. NetEase also offers online advertising, search, mobile applications and e-commerce.

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NetEase Inc (NTES US)

NetEase Inc.: The Expansion of Gaming Portfolio & Global Reach & Other Major Drivers

NetEase's recent quarterly earnings report demonstrates a mixed performance characterized by both promising growth areas and some challenges. The...

Baptista Research