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

Thematic (Sector/Industry)

<ul>
<li>NTES/700 HK: Tencent's &lt;Dream Star&gt; didn't perform as well as NetEase's &lt;Eggy Party&gt; during the Spring Festival.(+/-)</li>
<li>PDD/AMZN/SHEIN: Temu search queries pass SHEIN after running Super Bowl ads (+/-/-)</li>
<li>ZTO/1519 HK/PDD/BABA: Parcel volume delivery increased ~31% during the Spring Festival period (+)</li>
</ul>


NTES/700 HK: Tencent's &lt;Dream Star&gt; didn't perform as well as NetEase's &lt;Eggy Party&gt; during the Spring Festival.(+/-)
PDD/AMZN/SHEIN: Temu search queries pass SHEIN after running Super Bowl ads (+/-/-)
ZTO/1519 HK/PDD/BABA: Parcel volume delivery increased ~31% during the Spring Festival period (+)


[Blue Lotus Daily - TMT Update]: NTES/700 HK/PDD/AMZN/SHEIN/ZTO/1519 HK/PDD/BABA

Equity Bottom-Up

<ul>
<li>On February 15, OpenAI, Google and Amazon launched respective AI advances in video LLM (SORA), long text (Gemini 1.5), and text-to-speech (BASE) abilities. The evolution speed of AI inspired awe;</li>
<li>We estimate rival equivalent of SORA, delivered over cloud, will appear in 4-6 months of time but on-device version will take years.</li>
<li>We suggest 2C AI applications, especially video, will be the prime beneficiary</li>
</ul>


On February 15, OpenAI, Google and Amazon launched respective AI advances in video LLM (SORA), long text (Gemini 1.5), and text-to-speech (BASE) abilities. The evolution speed of AI inspired awe;
We estimate rival equivalent of SORA, delivered over cloud, will appear in 4-6 months of time but on-device version will take years.
We suggest 2C AI applications, especially video, will be the prime beneficiary


[Blue Lotus Technology Sector Update]: LLM Advances Give China and US Both Opportunities

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>There will be 3 changes for the Hang Seng Internet &amp; Information Technology Index (HSIII) at the March rebalance. There are some surprises.</li>
<li>Estimated one-way turnover at the rebalance is 5.6% resulting in a round-trip trade of HK$3.26bn (US$416m). 6 stocks will have over 1x ADV to trade.</li>
<li>There is huge short interest on <a href="https://www.smartkarma.com/entities/east-buy-holding-ltd" target="_blank" data-smartkarma-citation="entities:27796:1" rel="noopener">East Buy Holding (1797 HK)</a> and there could be some short covering ahead of the inclusion of the stock in the index.</li>
</ul>


There will be 3 changes for the Hang Seng Internet &amp; Information Technology Index (HSIII) at the March rebalance. There are some surprises.
Estimated one-way turnover at the rebalance is 5.6% resulting in a round-trip trade of HK$3.26bn (US$416m). 6 stocks will have over 1x ADV to trade.
There is huge short interest on East Buy Holding (1797 HK) and there could be some short covering ahead of the inclusion of the stock in the index.


Hang Seng Internet & IT Index Rebalance: Three Changes & One Big Surprise

Tongcheng Travel Holdings  / Event-Driven

<ul>
<li>As expected, <a href="https://www.smartkarma.com/entities/tongcheng-travel-holdings-ltd" target="_blank" data-smartkarma-citation="entities:27363:1" rel="noopener">Tongcheng Travel Holdings (780 HK)</a> will replace <a href="https://www.smartkarma.com/entities/gds-holdings-ltd" target="_blank" data-smartkarma-citation="entities:32157:1" rel="noopener">GDS Holdings (9698 HK)</a> in 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> at the close on 1 March.</li>
<li>Estimated one-way turnover is 3.9% leading to a round-trip trade of HK$7.74bn (US$988m). There is nearly 14x ADV to buy in <a href="https://www.smartkarma.com/entities/tongcheng-travel-holdings-ltd" target="_blank" data-smartkarma-citation="entities:27363:1" rel="noopener">Tongcheng Travel Holdings (780 HK)</a>. </li>
<li>Positioning in <a href="https://www.smartkarma.com/entities/tongcheng-travel-holdings-ltd" target="_blank" data-smartkarma-citation="entities:27363:1" rel="noopener">Tongcheng Travel (780 HK)</a> does not appear to be very high, while positioning in <a href="https://www.smartkarma.com/entities/gds-holdings-ltd" target="_blank" data-smartkarma-citation="entities:32157:1" rel="noopener">GDS Holdings (9698 HK)</a> is very high with a couple of deletions coming up.</li>
</ul>


As expected, Tongcheng Travel Holdings (780 HK) will replace GDS Holdings (9698 HK) in the Hang Seng TECH Index (HSTECH INDEX) at the close on 1 March.
Estimated one-way turnover is 3.9% leading to a round-trip trade of HK$7.74bn (US$988m). There is nearly 14x ADV to buy in Tongcheng Travel Holdings (780 HK). 
Positioning in Tongcheng Travel (780 HK) does not appear to be very high, while positioning in GDS Holdings (9698 HK) is very high with a couple of deletions coming up.


HSTECH Index Rebalance: Tongcheng (780 HK) In; GDS (9698 HK) Out; Round Trip Trade US$1bn

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 Feb 2nd.</li>
<li>Top short increases and decreases were tabulated for one week and four week period. </li>
<li>We highlight short changes in Hscei Etf, Bud Apac, CMB, Tencent, Wuxi Apptec, Wuxi Bio, Lenovo.</li>
</ul>


We analyzed the latest HK SFC report for aggregate short position as of Feb 2nd.
Top short increases and decreases were tabulated for one week and four week period. 
We highlight short changes in Hscei Etf, Bud Apac, CMB, Tencent, Wuxi Apptec, Wuxi Bio, Lenovo.


HK Short Interest Weekly: Hscei Etf, Bud Apac, CMB, Tencent, Wuxi Apptec, Wuxi Bio

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.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
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NetEase Inc (NTES US)

[Blue Lotus Daily - TMT Update]: NTES/700 HK/PDD/AMZN/SHEIN/ZTO/1519 HK/PDD/BABA

NetEase's outperformed Tencent's during Spring Festival; Temu search queries surpass SHEIN after Super Bowl ads; Parcel delivery volume up 31%...

Blue Lotus Research Institute

[Blue Lotus Technology Sector Update]: LLM Advances Give China and US Both Opportunities

OpenAI, Google and Amazon launched respective AI advances in video LLM (SORA), long text (Gemini 1.5), and text-to-speech (BASE) abilities.We...

Blue Lotus Research Institute

Hang Seng Internet & IT Index Rebalance: Three Changes & One Big Surprise

There are 3 changes for the HSIII in March. Estimated one-way turnover at the rebalance is 5.6% resulting in a round-trip trade of HK$3.26bn...

Brian Freitas

HSTECH Index Rebalance: Tongcheng (780 HK) In; GDS (9698 HK) Out; Round Trip Trade US$1bn

Tongcheng Travel replaces GDS Holdings in the HSTECH at the close on 1 March. GDS is also a delete from a global index on 29 Feb, Positioning in...

Brian Freitas

HK Short Interest Weekly: Hscei Etf, Bud Apac, CMB, Tencent, Wuxi Apptec, Wuxi Bio

We analyzed the latest HK SFC report for aggregate short position as of Feb 2nd and highlight short interest changes in Hscei Etf, Bud Apac, CMB,...

Ke Yan, CFA, FRM

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

[Blue Lotus Daily - TMT Update]: NTES/700 HK/PDD/AMZN/SHEIN/ZTO/1519 HK/PDD/BABA

​NetEase's outperformed Tencent's during Spring Festival; Temu search queries surpass SHEIN after Super Bowl ads; Parcel delivery volume up 31%...

Blue Lotus Research Institute

[Blue Lotus Technology Sector Update]: LLM Advances Give China and US Both Opportunities

OpenAI, Google and Amazon launched respective AI advances in video LLM (SORA), long text (Gemini 1.5), and text-to-speech (BASE) abilities.We...

Blue Lotus Research Institute

Hang Seng Internet & IT Index Rebalance: Three Changes & One Big Surprise

There are 3 changes for the HSIII in March. Estimated one-way turnover at the rebalance is 5.6% resulting in a round-trip trade of HK$3.26bn...

Brian Freitas

HSTECH Index Rebalance: Tongcheng (780 HK) In; GDS (9698 HK) Out; Round Trip Trade US$1bn

Tongcheng Travel replaces GDS Holdings in the HSTECH at the close on 1 March. GDS is also a delete from a global index on 29 Feb, Positioning in...

Brian Freitas

HK Short Interest Weekly: Hscei Etf, Bud Apac, CMB, Tencent, Wuxi Apptec, Wuxi Bio

We analyzed the latest HK SFC report for aggregate short position as of Feb 2nd and highlight short interest changes in Hscei Etf, Bud Apac, CMB,...

Ke Yan, CFA, FRM

NetEase's outperformed Tencent's during Spring Festival; Temu search queries surpass SHEIN after Super Bowl ads; Parcel delivery volume up 31%...