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 analyse the changes of A-H premium on 148 stocks over the last week. The average A-H premium was 108.9% as of Sep 27th.</li>
<li>The average A-H premium changed by -1.5ppt week-on-week, led by real estate, consumer discretionary, information technology and offset by consumer staples, communication services, energy.</li>
<li>We highlight weekly changes in A-H premium for China Eastern, China Southern Airlines, Tsingtao, HPI, RemeGen.</li>
</ul>


We analyse the changes of A-H premium on 148 stocks over the last week. The average A-H premium was 108.9% as of Sep 27th.
The average A-H premium changed by -1.5ppt week-on-week, led by real estate, consumer discretionary, information technology and offset by consumer staples, communication services, energy.
We highlight weekly changes in A-H premium for China Eastern, China Southern Airlines, Tsingtao, HPI, RemeGen.


A-H Premium Weekly (Sep 27th):China Eastern, China Southern Airlines, Tsingtao, HPI, RemeGen

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Bottom-Up

<ul>
<li>Although RemeGen’s 23Q1-Q3 sales was better-than-expected, the Company is difficult to achieve management's performance guidance for 2023. Since RemeGen’s commercialization logic has “undeniable flaws”, net loss would be further widened.</li>
<li>Cash balance of RemeGen was just RMB600 million by 23Q3, which is not enough to cover its high R&amp;D/SG&amp;A expenses. If RemeGen cannot secure sufficient financing timely, risks are significant.</li>
<li>The current valuation and investors’ expectations for RemeGen largely rely on the potential license-out deal of RC18. However, we remain caution until RC18 has sufficient evidence to win head-to-head trial.</li>
</ul>


Although RemeGen’s 23Q1-Q3 sales was better-than-expected, the Company is difficult to achieve management's performance guidance for 2023. Since RemeGen’s commercialization logic has “undeniable flaws”, net loss would be further widened.
Cash balance of RemeGen was just RMB600 million by 23Q3, which is not enough to cover its high R&amp;D/SG&amp;A expenses. If RemeGen cannot secure sufficient financing timely, risks are significant.
The current valuation and investors’ expectations for RemeGen largely rely on the potential license-out deal of RC18. However, we remain caution until RC18 has sufficient evidence to win head-to-head trial.


Remegen (9995.HK/688331.CH) - The Survival Problem Is Becoming Imminent

<ul>
<li>We analyse the changes of A-H premium on 148 stocks over the last week. The average A-H premium was 111.2% as of Sep 20th.</li>
<li>The average A-H premium changed by -0.3ppt week-on-week, led by consumer discretionary, communication services, materials and offset by consumer staples, health care.</li>
<li>We highlight weekly changes in A-H premium for RemeGen, JOINN, Shenzhen Expressway, Anhui Expressway, GAC Group, Ganfeng Lithium.</li>
</ul>


We analyse the changes of A-H premium on 148 stocks over the last week. The average A-H premium was 111.2% as of Sep 20th.
The average A-H premium changed by -0.3ppt week-on-week, led by consumer discretionary, communication services, materials and offset by consumer staples, health care.
We highlight weekly changes in A-H premium for RemeGen, JOINN, Shenzhen Expressway, Anhui Expressway, GAC Group, Ganfeng Lithium.


A-H Premium Weekly (Sep 20th):RemeGen, JOINN, Shenzhen Expressway, Anhui Expressway, GAC Group

Equity Capital Markets

Duality Biotherapeutics / Equity Capital Markets

<ul>
<li>Duality Biotherapeutics, a China-based clinical-stage biotechnology company, plans to raise up to US$300m via a Hong Kong listing.</li>
<li>In this note, we examine the company's two core products, namely DB-1313 (HER2 ADC) and DB-1311 (B7-H3 ADC). We think the company's products are not yet convincing.</li>
<li>While the management has expertise as biotech investors, biotech-related operational experience seems to be lacking.</li>
</ul>


Duality Biotherapeutics, a China-based clinical-stage biotechnology company, plans to raise up to US$300m via a Hong Kong listing.
In this note, we examine the company's two core products, namely DB-1313 (HER2 ADC) and DB-1311 (B7-H3 ADC). We think the company's products are not yet convincing.
While the management has expertise as biotech investors, biotech-related operational experience seems to be lacking.


Duality Biotherapeutics (映恩生物) Pre-IPO: Too Early, Too Ambitious

<ul>
<li>We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of August 30th.</li>
<li>The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.</li>
<li>We highlight flows for Tencent (700 HK), Xiaomi Corporation (1810 HK).</li>
</ul>


We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of August 30th.
The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.
We highlight flows for Tencent (700 HK), Xiaomi Corporation (1810 HK).


Hong Kong Connect Flows (Aug 30th): Tencent, Xiaomi Corporation

China

RemeGen Co., Ltd. operates biotechnology businesses. The Company develops therapeutic antibody drugs such as antibody drug conjugates (ADC), antibody fusion proteins, monoclonal antibodies and double antibodies. RemeGen provides solutions autoimmune diseases, tumor diseases, and ophthalmic diseases.

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Remegen (9995 HK)

A-H Premium Weekly (Sep 27th):China Eastern, China Southern Airlines, Tsingtao, HPI, RemeGen

We analyzed A-H premium changes in the past week and highlight A-H premium changes for China Eastern, China Southern Airlines, Tsingtao, HPI, RemeGen.

Ke Yan, CFA, FRM

Remegen (9995.HK/688331.CH) - The Survival Problem Is Becoming Imminent

Due to “undeniable flaw” in commercialization logic, RemeGen has to face high cost/low efficiency, leading to increasing net loss.RemeGen is short...

Xinyao (Criss) Wang

A-H Premium Weekly (Sep 20th):RemeGen, JOINN, Shenzhen Expressway, Anhui Expressway, GAC Group

We analyzed A-H premium changes in the past week and highlight A-H premium changes for RemeGen, JOINN, Shenzhen Expressway, Anhui Expressway, GAC...

Ke Yan, CFA, FRM

Duality Biotherapeutics (映恩生物) Pre-IPO: Too Early, Too Ambitious

Duality biotherapeutics is looking to raise USD 300m in a Hong Kong listing. We look at its core products and key products, as well as its investor...

Ke Yan, CFA, FRM

Hong Kong Connect Flows (Aug 30th): Tencent, Xiaomi Corporation

We analyzed southbound Hong Kong connect flows in the past week and highlighted flows for Tencent (700 HK), Xiaomi Corporation (1810 HK).

Ke Yan, CFA, FRM

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