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

Zylox-Tonbridge Medical Technology / Equity Capital Markets

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<a href="https://www.smartkarma.com/entities/zylox-tonbridge-medical-technology-co-ltd" target="_blank" data-smartkarma-citation="entities:32974:1" rel="noopener">Zylox-Tonbridge Medical Technology (2190 HK)</a> is a China-based neuro- and peripheral-vascular interventional medical device manufacturer. The product portfolio consists of a total of eight approved products in China and overseas. Its two core products which are launched in China are Thrombite Clot Retriever Device (Thrombite CRD) and Ultrafree Drug Coated PTA Balloon Catheter (Ultrafree DCB). 
Zylox-Tonbridge has launched an HKEx IPO to raise net proceeds of $300 million at the mid-point of the IPO price range of HK$39.80-42.70 per share. Twelve cornerstone investors will subscribe for $145 million worth of the offer shares (45.47% of the offer shares at the mid-point). Pricing will be finalised on 25 June and the shares will list on 5 July.
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In <a href="https://www.smartkarma.com/insights/zylox-tonbridge-ipo-living-on" target="_blank" data-smartkarma-citation="insights:53469" rel="noopener">Zylox-Tonbridge IPO: Living On</a>, we opined that Zylox-Tonbridge is on the cusp of delivering on a sizeable addressable market opportunity as its two core products (Thrombite CRD and Ultrafree DCB) were only recently commercialised in China. While Thrombite CRD and Ultrafree DCB will account for most of the revenue over the short term, Zylox-Tonbridge has a strong near-term commercialisation pipeline, which further de-risks the story. We concluded that Zylox-Tonbridge’s product portfolio is attractive.
<div class="content-highlight">Our base-case DCF valuation is HK$48.56 per share, which is an 18% upside to the mid-point of the IPO price range of HK$39.80-42.70 per share. Consequently, we would participate in the IPO. </div>
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Zylox-Tonbridge Medical Technology (2190 HK) is a China-based neuro- and peripheral-vascular interventional medical device manufacturer. The product portfolio consists of a total of eight approved products in China and overseas. Its two core products which are launched in China are Thrombite Clot Retriever Device (Thrombite CRD) and Ultrafree Drug Coated PTA Balloon Catheter (Ultrafree DCB). 
Zylox-Tonbridge has launched an HKEx IPO to raise net proceeds of $300 million at the mid-point of the IPO price range of HK$39.80-42.70 per share. Twelve cornerstone investors will subscribe for $145 million worth of the offer shares (45.47% of the offer shares at the mid-point). Pricing will be finalised on 25 June and the shares will list on 5 July.

In Zylox-Tonbridge IPO: Living On, we opined that Zylox-Tonbridge is on the cusp of delivering on a sizeable addressable market opportunity as its two core products (Thrombite CRD and Ultrafree DCB) were only recently commercialised in China. While Thrombite CRD and Ultrafree DCB will account for most of the revenue over the short term, Zylox-Tonbridge has a strong near-term commercialisation pipeline, which further de-risks the story. We concluded that Zylox-Tonbridge’s product portfolio is attractive.
Our base-case DCF valuation is HK$48.56 per share, which is an 18% upside to the mid-point of the IPO price range of HK$39.80-42.70 per share. Consequently, we would participate in the IPO. 


<a href="https://www.smartkarma.com/entities/zylox-tonbridge-medical-technology-co-ltd" target="_blank" data-smartkarma-citation="entities:32974:1" rel="noopener">Zylox-Tonbridge Medical Technology (2190 HK)</a> is a China-based neuro- and peripheral-vascular interventional medical device manufacturer. The product portfolio consists of a total of eight approved products in China and overseas. Its two core products which are launched in China are Thrombite Clot Retriever Device (Thrombite CRD) and Ultrafree Drug Coated PTA Balloon Catheter (Ultrafree DCB). Zylox-Tonbridge has launched an HKEx IPO to raise net proceeds of HK$2,314.0 million ($300 million) at the mid-point of the IPO price range of HK$39.80-42.70 per share. Twelve cornerstone investors will subscribe for $145 million worth of the offer shares (45.47% of the offer shares at the mid-point of the IPO price range). The cornerstone investors include new investors such as Hillhouse, Fidelity International, Boyu Capital, Snow Lake Fund, Athos Capital, Sage Partners and IvyRock. The neuro-interventional medical device market in China is expected to grow from RMB4.9 billion in 2019 to RMB37.1 billion in 2030 at a CAGR of 20.2% from 2019 to 2030, according to Frost &amp; Sullivan. The growth is underpinned by the increasing prevalence and treatment rate, the substitution of imported devices by domestic device, increasing patient affordability, improving accessibility of treatments and favourable policy support.<div class="content-highlight">Zylox-Tonbridge is on the cusp of delivering on this market opportunity as its two core products (Thrombite CRD and Ultrafree DCB) were only recently commercialised in China. While Thrombite CRD and Ultrafree DCB will account for most of the revenue over the short term, Zylox-Tonbridge has a strong near-term commercialisation pipeline, which further de-risks the story. Overall, we believe that Zylox-Tonbridge’s product portfolio is attractive. We will discuss the valuation in the next note. </div>

Zylox-Tonbridge Medical Technology (2190 HK) is a China-based neuro- and peripheral-vascular interventional medical device manufacturer. The product portfolio consists of a total of eight approved products in China and overseas. Its two core products which are launched in China are Thrombite Clot Retriever Device (Thrombite CRD) and Ultrafree Drug Coated PTA Balloon Catheter (Ultrafree DCB). Zylox-Tonbridge has launched an HKEx IPO to raise net proceeds of HK$2,314.0 million ($300 million) at the mid-point of the IPO price range of HK$39.80-42.70 per share. Twelve cornerstone investors will subscribe for $145 million worth of the offer shares (45.47% of the offer shares at the mid-point of the IPO price range). The cornerstone investors include new investors such as Hillhouse, Fidelity International, Boyu Capital, Snow Lake Fund, Athos Capital, Sage Partners and IvyRock. The neuro-interventional medical device market in China is expected to grow from RMB4.9 billion in 2019 to RMB37.1 billion in 2030 at a CAGR of 20.2% from 2019 to 2030, according to Frost &amp; Sullivan. The growth is underpinned by the increasing prevalence and treatment rate, the substitution of imported devices by domestic device, increasing patient affordability, improving accessibility of treatments and favourable policy support.Zylox-Tonbridge is on the cusp of delivering on this market opportunity as its two core products (Thrombite CRD and Ultrafree DCB) were only recently commercialised in China. While Thrombite CRD and Ultrafree DCB will account for most of the revenue over the short term, Zylox-Tonbridge has a strong near-term commercialisation pipeline, which further de-risks the story. Overall, we believe that Zylox-Tonbridge’s product portfolio is attractive. We will discuss the valuation in the next note. 

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.

Zylox-Tonbridge is a leading China-based neuro- and peripheral-vascular interventional device company. The company launched book building to raise up to USD 330m via a Hong Kong listing.In our previous note, we looked at two key products of the company, namely the Thrombite clot retriever for acute ischemic stroke treatment, and Ultrafree Drug Coated PTA Balloon Catheter for the arterial stenosis or occlusion. The Thrombite clot retriever demonstrated efficacy and safety that is in-line with the benchmark product developed by an international device player, while the reading from head-to-head clinical research of Ultrafree Drug Coated PTA Balloon Cathether appears to be better than its competitor product. The key challenge for the company is the competition in each of its product lines as the company does not have much early bird advantage in the field.In this note, we provide an update for the book building. We will run the deal through our ECM framework and provide an update on the deal.

Zylox-Tonbridge is a leading China-based neuro- and peripheral-vascular interventional device company. The company launched book building to raise up to USD 330m via a Hong Kong listing.In our previous note, we looked at two key products of the company, namely the Thrombite clot retriever for acute ischemic stroke treatment, and Ultrafree Drug Coated PTA Balloon Catheter for the arterial stenosis or occlusion. The Thrombite clot retriever demonstrated efficacy and safety that is in-line with the benchmark product developed by an international device player, while the reading from head-to-head clinical research of Ultrafree Drug Coated PTA Balloon Cathether appears to be better than its competitor product. The key challenge for the company is the competition in each of its product lines as the company does not have much early bird advantage in the field.In this note, we provide an update for the book building. We will run the deal through our ECM framework and provide an update on the deal.

Zylox-Tonbridge (归创通桥) IPO: Clear Upside Thanks to Comprehensive Coverage

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Shanghai Hanyu Medical Technology / Equity Capital Markets

On April 14, 2021, <a href="https://www.smartkarma.com/entities/shanghai-hanyu-medical-technology-co-ltd" target="_blank" data-smartkarma-citation="entities:33016:1" rel="noopener">Shanghai Hanyu Medical Technology (SHM HK)</a> submitted its listing application to the main board of the Hong Kong Stock Exchange. According to the data of TianYanCha, the Series D financing was completed in 2020, and in March 2021, Hanyu completed the Series D+ financing, led by Yunfeng Capital. Shortly after about a month, Hanyu officially launch its IPO plan. So how about the company? This insight mainly analyzed the market potential and the product candidates of Hanyu.

On April 14, 2021, Shanghai Hanyu Medical Technology (SHM HK) submitted its listing application to the main board of the Hong Kong Stock Exchange. According to the data of TianYanCha, the Series D financing was completed in 2020, and in March 2021, Hanyu completed the Series D+ financing, led by Yunfeng Capital. Shortly after about a month, Hanyu officially launch its IPO plan. So how about the company? This insight mainly analyzed the market potential and the product candidates of Hanyu.

Pre-IPO Shanghai Hanyu Medical Technology - Insights on the Industry and the Products

Thematic (Sector/Industry)

Industry Viewpoints:<ul>
<li>The 5th national volume-based purchase (VBP) was officially launched.</li>
<li>In 2020, China's pharmaceutical and life sciences industry disclosed 928 deals worth US$43 billion, up about 73% YoY.</li>
<li>The market is quite concerned about whether the healthcare sector would enter a new round of policy regulation period, but we think it may not.</li>
</ul>Company News:News about the updated progress on drugs and medical devices of <a href="https://www.smartkarma.com/entities/jiangsu-hengrui-medicine-co-ltd" target="_blank" data-smartkarma-citation="entities:14128:1" rel="noopener">Jiangsu Hengrui Medicine (600276 CH)</a>, <a href="https://www.smartkarma.com/entities/cspc-pharmaceutical-group-ltd" target="_blank" data-smartkarma-citation="entities:229:1" rel="noopener">CSPC Pharmaceutical Group (1093 HK)</a> and <a href="https://www.smartkarma.com/entities/peijia-medical" target="_blank" data-smartkarma-citation="entities:28862:1" rel="noopener">Peijia Medical (9996 HK).</a>Market Review:Last week, stock price for healthcare sector in A share increased 6.29%, while CSI 300 increased 3.41% over the same period of time.Risk Disclosure:Policy risk, R&amp;D risk, Company risk and COVID-19 risk.

Industry Viewpoints:
The 5th national volume-based purchase (VBP) was officially launched.
In 2020, China's pharmaceutical and life sciences industry disclosed 928 deals worth US$43 billion, up about 73% YoY.
The market is quite concerned about whether the healthcare sector would enter a new round of policy regulation period, but we think it may not.
Company News:News about the updated progress on drugs and medical devices of Jiangsu Hengrui Medicine (600276 CH), CSPC Pharmaceutical Group (1093 HK) and Peijia Medical (9996 HK).Market Review:Last week, stock price for healthcare sector in A share increased 6.29%, while CSI 300 increased 3.41% over the same period of time.Risk Disclosure:Policy risk, R&amp;D risk, Company risk and COVID-19 risk.

China

Peijia Medical Ltd. produces and sells medical devices. The Company develops and sells heart valve disease treatment medical devices and other products. Peijia Medical Technology markets its products throughout China. 

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Peijia Medical (9996 HK)

Zylox-Tonbridge IPO: Valuation Insights

Our base-case DCF valuation is HK$48.56 per share, which is an 18% upside to the mid-point of the IPO price range of HK$39.80-42.70 per share....

Arun George

Zylox-Tonbridge IPO: Living On

Zylox-Tonbridge has launched an HKEx IPO to raise net proceeds of $300 million at the mid-point of the IPO price range. Overall, we believe that...

Arun George

Zylox-Tonbridge (归创通桥) IPO: Clear Upside Thanks to Comprehensive Coverage

With its comprehensive product coverage in the neuro- and peripheral interventional device segment, we think there's a clear valuation upside for...

Ke Yan, CFA, FRM

Pre-IPO Shanghai Hanyu Medical Technology - Insights on the Industry and the Products

This insight mainly analyzed the industry characteristics and market potential of the mitral valve market, the products of both Hanyu and its...

Xinyao (Criss) Wang

China Healthcare Weekly (Apr.23)

This article analyzed the 5th national volume-based purchase, China's pharmaceutical and life sciences deals in 2020, potential policy impact on...

Xinyao (Criss) Wang

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