Analyst

Steve Zhou, CFA

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/onewo-inc" target="_blank" data-smartkarma-citation="entities:36204:1" rel="noopener">Onewo (2602 HK)</a>, a leading China property management company with the controlling shareholder being <a href="https://www.smartkarma.com/entities/china-vanke-co-ltd-h" target="_blank" data-smartkarma-citation="entities:18368:1" rel="noopener">China Vanke (H) (2202 HK)</a>, announced a major share repurchase mandate last night.</li>
<li>The company intends to repurchase its shares in the open market up to HKD5.8bn, which is around 20% of the current market cap. </li>
<li>The company is trading at 13x 2024E PE on around 15% net profit growth in 2024E, and at 5% forward dividend yield. </li>
</ul>



Onewo (2602 HK), a leading China property management company with the controlling shareholder being China Vanke (H) (2202 HK), announced a major share repurchase mandate last night.
The company intends to repurchase its shares in the open market up to HKD5.8bn, which is around 20% of the current market cap. 
The company is trading at 13x 2024E PE on around 15% net profit growth in 2024E, and at 5% forward dividend yield. 


Onewo (2602 HK):  Major Share Repurchase Mandate Announced (Up To HKD5.8bn, 20% Of Current MKT CAP)

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>
<a href="https://www.smartkarma.com/entities/onewo-inc" target="_blank" data-smartkarma-citation="entities:36204:1" rel="noopener">Onewo (2602 HK)</a> has announced the full conversion of 1.05bn Domestic Shares and Unlisted Foreign Shares to H-shares. The increased market cap will help in HSCI inclusion.</li>
<li>
<a href="https://www.smartkarma.com/entities/onewo-inc" target="_blank" data-smartkarma-citation="entities:36204:1" rel="noopener">Onewo (2602 HK)</a> should be added to the HSCI in March and will be added to Southbound Stock Connect soon after index inclusion.</li>
<li>
<a href="https://www.smartkarma.com/entities/onewo-inc" target="_blank" data-smartkarma-citation="entities:36204:1" rel="noopener">Onewo (2602 HK)</a> has drastically underperformed its peers since listing and the HSCI inclusion could mark a turning point for the stock.</li>
</ul>



Onewo (2602 HK) has announced the full conversion of 1.05bn Domestic Shares and Unlisted Foreign Shares to H-shares. The increased market cap will help in HSCI inclusion.

Onewo (2602 HK) should be added to the HSCI in March and will be added to Southbound Stock Connect soon after index inclusion.

Onewo (2602 HK) has drastically underperformed its peers since listing and the HSCI inclusion could mark a turning point for the stock.


Onewo (2602 HK) - Full Circulation & HSCI Inclusion

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

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.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/onewo-inc" target="_blank" data-smartkarma-citation="entities:36204:1" rel="noopener">Onewo (2602 HK)</a> (OST) had raised around US$730m in its Hong Kong IPO in Sep 2022. Its one-year lockup is set to expire soon.</li>
<li>OST is a property management service provider in China, primarily owned by <a href="https://www.smartkarma.com/entities/china-vanke-co-ltd-h" target="_blank" data-smartkarma-citation="entities:18368:1" rel="noopener">China Vanke (H) (2202 HK)</a>.</li>
<li>In this note, we will talk about the lock-up dynamics and updates since our last note.</li>
</ul>



Onewo (2602 HK) (OST) had raised around US$730m in its Hong Kong IPO in Sep 2022. Its one-year lockup is set to expire soon.
OST is a property management service provider in China, primarily owned by China Vanke (H) (2202 HK).
In this note, we will talk about the lock-up dynamics and updates since our last note.


Onewo IPO Lock-Up - US$1bn+ Lockup Release, Parent Could Still Sell

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>Onewo’s 1H23 results missed the market expectation but declared an interim dividend for the first time after IPO.</li><li>The Company’s Onewo Town strategy is becoming more convincing evidenced by better margin.</li><li>We think the controversial topic of bidding contract with capital investment is actually a good strategy given the reasons explained below. </li></ul>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.

Onewo’s 1H23 results missed the market expectation but declared an interim dividend for the first time after IPO.The Company’s Onewo Town strategy is becoming more convincing evidenced by better margin.We think the controversial topic of bidding contract with capital investment is actually a good strategy given the reasons explained below. 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.

Onewo (2602 HK) – 1H23 Earnings Missed.

Thematic (Sector/Industry)

<ul><li>China’s destocking scheme showed encouraging progress, with Guangzhou announcing to purchase developers’ unsold inventory at cost prices, which could serve as an example for other cities. We think the scheme currently may only benefit SOEs/semi-SOEs as LGFVs may need to divest their financing function at first.</li><li>A number of regions actively implemented mortgage rate related policies after 17 May, and we think there is still room for further adjustment in Beijing, Shanghai and Shenzhen.</li><li>Noticeable recovery on property sales was shown with the daily transaction volume post-517 policy for new/second hand home increasing by 23%/21% compared to pre-517 policy. </li></ul>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.

China’s destocking scheme showed encouraging progress, with Guangzhou announcing to purchase developers’ unsold inventory at cost prices, which could serve as an example for other cities. We think the scheme currently may only benefit SOEs/semi-SOEs as LGFVs may need to divest their financing function at first.A number of regions actively implemented mortgage rate related policies after 17 May, and we think there is still room for further adjustment in Beijing, Shanghai and Shenzhen.Noticeable recovery on property sales was shown with the daily transaction volume post-517 policy for new/second hand home increasing by 23%/21% compared to pre-517 policy. 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.

Property - Encouraging Signs on Both Policy Implementation and Property Sales, Reiterate Buy

China

Yuexiu Property Company Ltd., through its subsidiaries, develops, manages and invests in properties. The Company also invests in a Real Estate Investment Trusts.

Seazen Holdings Co., Ltd. operates as a real estate development company. The Company develops residential buildings, office buildings, commercial buildings, infrastructure facilities, and more. Seazen Holdings also provides market research, information consulting, and other services.

Shanghai Lujiazui Finance & Trade Zone Development Co., Ltd. operates in land development, property management, and infrastructure facilities construction within the Lujiazui Finance and Trade Zone.  The Company also undertakes building and renovation projects.

Shanghai Lujiazui Finance & Trade Zone (600663 CH)

Country Garden Services Holdings Company Limited provides real estate development services. The Company develops residential apartments, multi-functional complex buildings, government and public facilities, industrial parks, highway service stations, and schools. Country Garden Services Holdings serves clients in China.

Poly Property Services Co., Ltd. provides property services. The Company offers property management, property projects pre-consultation, post-delivery evaluation and analysis, professional equipment and facilities maintenance, housekeeping, and other services. Poly Property Services provides services in China.

Shoucheng Holdings Limited operates as an investment management company. The Company provides car parking asset operation and management and urban renewal oriented fund management services. Shoucheng Holdings mainly conducts businesses in Hong Kong.

Red Star Macalline Group Corporation Ltd. operates home decoration and furniture stores. The Company engages in leasing floor areas, providing consultation and management services, sales of merchandise, strategy consultation, home design consultation, and construction service. Red Star Macalline Group Corporation conducts businesses in China.

Midea Real Estate Holding Limited operates as a holding company. The Company, through its subsidiaries, provides property management, property sales, property development, and other services.

Shanghai Shibei Hi-Tech Co.,Ltd. operates real estate businesses. The Company provides housing renovation, housing loans, real estate brokerage, property management, and other services. Shanghai Shibei Hi-Tech also operates investment management, enterprise management, and other businesses.

Beijing North Star Company Limited develops, leases, and invests in properties. The Company operates shopping centers, hotels, restaurants, and recreation businesses.  The Company also provides property management.

Cushman & Wakefield plc operates as a commercial real estate company. The Company develops commercial properties, as well as provides property leasing, facilities management, tenant representation, and valuation services. Cushman & Wakefield serves clients worldwide.

The Howard Hughes Corporation develops real estate. The Company manages master planned communities, shopping malls, and mixed-use developments throughout the United States.

Aroundtown SA operates as a real estate company. The Company manages and invests in commercial and residential real estate assets from strong fundamentals and growth prospects. Aroundtown serves customers in Europe.

Land and Houses Public Company Limited develops real estate projects including single-detached homes, townhouses, and condominiums. The Company builds single and attached homes, primarily on land that it develops and improves. Land and Houses also operates its own architectural, engineering, design and construction teams for customer's specific designs and orders.

Forestar Group Inc. operates as a residential lot development company. The Company acquires entitled real estate and develops it into finished residential lots for sale to homebuilders with a strategic focus on asset turns. Forestar Group serves customers in the United States.

Swire Pacific Limited operates as a holding company. The Company, through its subsidiaries, focuses on real estate, aviation, beverage, industrial, marine services, trading, and industrial businesses. Swire Pacific operates worldwide.

Vincom Retail Joint Stock Company owns and develops shopping malls. The Company offers dining, apparel, gaming, theme park, and entertainment facilities. Vincom Retail serves customers in Vietnam.

Novaland Investment Group Corporation operates as a real estate development and investment company. The Company provides urban, tourism, and industrial real estate development and management services. Novaland Investment Group serves customers in Vietnam.

KATITAS Co., Ltd. provides real estate services. The Company mainly offers second-hand house management, marketing, brokerage, and other related services. KATITAS provides services throughout Japan.

Anywhere Real Estate Inc. operates as a holding company. The Company through its subsidiaries, provides real estate, franchising, brokerage, relocation, and title and settlement services. Anywhere Real Estate offers its services worldwide.

Onewo Inc. operates as a property management service provider. The Company operates and manages residential communities, workspaces, public premises, and others. Onewo provides its services throughout Hong Kong.

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Onewo (2602 HK)

Onewo (2602 HK) - Full Circulation & HSCI Inclusion

Onewo has announced full circulation of H-shares. That should result in HSCI and Stock Connect inclusion in March. Onewo has underperformed its...

Brian Freitas

Onewo IPO Lock-Up - US$1bn+ Lockup Release, Parent Could Still Sell

Onewo (2602 HK) (OST) had raised around US$730m in its Hong Kong IPO in Sep 2022. Its one-year lockup is set to expire soon.

Sumeet Singh

Onewo (2602 HK) – 1H23 Earnings Missed.

We think the controversial topic of bidding contract with capital investment is actually a good strategy given the reasons explained below.

CMB International

Property - Encouraging Signs on Both Policy Implementation and Property Sales, Reiterate Buy

For stocks, we prefer PM companies like CR MixC, Poly Services, Binjiang Services and Onewo, property agents BEKE, and PJM company Greentown Mgmt.

CMB International

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Onewo (2602 HK): Major Share Repurchase Mandate Announced (Up To HKD5.8bn, 20% Of Current MKT CAP)

Onewo (2602 HK), a leading China property management company, announced a major share repurchase mandate last night. The company intends to...

Steve Zhou, CFA

Onewo (2602 HK) - Full Circulation & HSCI Inclusion

Onewo has announced full circulation of H-shares. That should result in HSCI and Stock Connect inclusion in March. Onewo has underperformed its...

Brian Freitas

Onewo IPO Lock-Up - US$1bn+ Lockup Release, Parent Could Still Sell

Onewo (2602 HK) (OST) had raised around US$730m in its Hong Kong IPO in Sep 2022. Its one-year lockup is set to expire soon.

Sumeet Singh

Onewo (2602 HK) – 1H23 Earnings Missed.

We think the controversial topic of bidding contract with capital investment is actually a good strategy given the reasons explained below.

CMB International

Property - Encouraging Signs on Both Policy Implementation and Property Sales, Reiterate Buy

For stocks, we prefer PM companies like CR MixC, Poly Services, Binjiang Services and Onewo, property agents BEKE, and PJM company Greentown Mgmt.

CMB International