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 analyze the weekly Shanghai/Shenzhen northbound Connect flows with our data engine for holding position as of May 25th.</li>
<li>We estimate the weekly outflows to be US$2,561.1 million, led by materials, financials, and offset by communication services, utilities, energy.</li>
<li>We highlight flows for CATL, Luxshare Precision Industry, Longi Green, China Merchants Bank, Wuliangye Yibin, Ping An Insurance, Ping An Bank, East Money Information.</li>
</ul>


We analyze the weekly Shanghai/Shenzhen northbound Connect flows with our data engine for holding position as of May 25th.
We estimate the weekly outflows to be US$2,561.1 million, led by materials, financials, and offset by communication services, utilities, energy.
We highlight flows for CATL, Luxshare Precision Industry, Longi Green, China Merchants Bank, Wuliangye Yibin, Ping An Insurance, Ping An Bank, East Money Information.


Northbound Flows (May 25th): CATL, Luxshare Precision, Longi Green, CMB, Wuliangye, East Money

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 are 18 changes for the SSE180 Index that will be implemented at the close of trading on 9 June.</li>
<li>The impact on the stocks is small but this is not a widely tracked index, so there could still be opportunities for some high risk/reward basket trades.</li>
<li>With Northbound Stock Connect eligibility no longer drawing on the SSE180 Index constituents, the index could lose relevance over time.</li>
</ul>


There are 18 changes for the SSE180 Index that will be implemented at the close of trading on 9 June.
The impact on the stocks is small but this is not a widely tracked index, so there could still be opportunities for some high risk/reward basket trades.
With Northbound Stock Connect eligibility no longer drawing on the SSE180 Index constituents, the index could lose relevance over time.


SSE180 Index Rebalance: Small Impact but Not Widely Tracked

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.

Thematic (Sector/Industry)

<ul><li>We untangle the “household excess saving” enigma.</li><li>Instead of a silver bullet, we consider it a status-quo in which consumers are confident enough to spend (or invest) beyond their pre-pandemic budgets by tapping into their savings accumulated during the pandemic, after they first normalize their spending to prepandemic level.</li><li>In other words, we believe the use of “excess saving” would predominantly kick-in upon a full-fledged consumption recovery. </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.

We untangle the “household excess saving” enigma.Instead of a silver bullet, we consider it a status-quo in which consumers are confident enough to spend (or invest) beyond their pre-pandemic budgets by tapping into their savings accumulated during the pandemic, after they first normalize their spending to prepandemic level.In other words, we believe the use of “excess saving” would predominantly kick-in upon a full-fledged consumption recovery. 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 Consumer – From Reopening to Recovery

Equity Bottom-Up

<ul><li>Undoubtedly, Proya is on track to deliver its long-term financial target stipulated in its ESOP.</li><li>On the flip side, however, this could inevitably imply growth momentum to peak-out/ fully-priced in the medium term, especially when the low hanging fruit from livestreaming is gone.</li><li>We think Proya’s multiple re-rating could take a pause from here. </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.

Undoubtedly, Proya is on track to deliver its long-term financial target stipulated in its ESOP.On the flip side, however, this could inevitably imply growth momentum to peak-out/ fully-priced in the medium term, especially when the low hanging fruit from livestreaming is gone.We think Proya’s multiple re-rating could take a pause from here. 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.

Proya Cosmetics (603605 CH) – ESOP & Mgt Sell-Off Signal Growth to Peak-Out

<ul>
<li>We analyze the monthly Shanghai/Shenzhen northbound Connect flows with our data engine.</li>
<li>Inflows into industrials, energy, and utilities were offset by outflows from financials, and information technology.</li>
<li>We highlight flows for COSCO Shipping, Shenzhen Inovance, Zhejiang Jingsheng, Ningbo Tuopu, Wuliangye, Ping An Insurance, Moutai, East Money, CMB, Midea.</li>
</ul>


We analyze the monthly Shanghai/Shenzhen northbound Connect flows with our data engine.
Inflows into industrials, energy, and utilities were offset by outflows from financials, and information technology.
We highlight flows for COSCO Shipping, Shenzhen Inovance, Zhejiang Jingsheng, Ningbo Tuopu, Wuliangye, Ping An Insurance, Moutai, East Money, CMB, Midea.


Northbound Flows Monthly (April): Inflows into Industrials Offset by Outflows from Financials

China

Proya Cosmetics Co., Ltd. operates as a cosmetics products manufacturing company. The Company researches and markets skin care products, make up, body wash, and other related products. Proya Cosmetics markets its products throughout China.

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Proya Cosmetics (603605 CH)

Northbound Flows (May 25th): CATL, Luxshare Precision, Longi Green, CMB, Wuliangye, East Money

We analyzed northbound Shanghai/Shenzhen connect flows in the past week and highlight flows for CATL, Luxshare Precision, Longi Green, China...

Ke Yan, CFA, FRM

SSE180 Index Rebalance: Small Impact but Not Widely Tracked

There are 18 changes for the SSE180 Index in June. The index is not widely tracked and there could be opportunities for long/short basket trades...

Brian Freitas

China Consumer – From Reopening to Recovery

In other words, we believe the use of “excess saving” would predominantly kick-in upon a full-fledged consumption recovery.

CMB International