HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Equity Bottom-Up

Shanghai United Imaging Health / Equity Bottom-Up

<ul>
<li>Benefiting from changes in pandemic prevention policies and favorable reimbursement policy support, TCM injections market would end its years of continuous decline and enter a period of rapid growth again.</li>
<li>After Novo Nordisk acquires Catalent, China CXOs would be less likely to obtain the global GLP-1 orders. As MNCs rethink supply chain issues, China CXOs would face more challenges.</li>
<li>Against the backdrop of anti-corruption/import substitution, investment logic of United Imaging is solid. However, the biggest issue is high valuation. Fundamentals're difficult to support more than RMB100 billion market value.</li>
</ul>


Benefiting from changes in pandemic prevention policies and favorable reimbursement policy support, TCM injections market would end its years of continuous decline and enter a period of rapid growth again.
After Novo Nordisk acquires Catalent, China CXOs would be less likely to obtain the global GLP-1 orders. As MNCs rethink supply chain issues, China CXOs would face more challenges.
Against the backdrop of anti-corruption/import substitution, investment logic of United Imaging is solid. However, the biggest issue is high valuation. Fundamentals're difficult to support more than RMB100 billion market value.


China Healthcare Weekly (Mar.22)-TCM Injection Revive, China CXO Lag Behind in GLP-1, United Imaging

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>The FRTIB benchmark switch from the EAFE Index to the ACWI IMI ex-USA ex-China ex-Hong Kong Index will result in a round trip trade of around US$56bn.</li>
<li>The changes for the <a href="https://www.smartkarma.com/entities/shanghai-shenzhen-csi-300-inde" target="_blank" data-smartkarma-citation="entities:22906:1" rel="noopener">CSI 300</a>, <a href="https://www.smartkarma.com/entities/csi-smallcap-500-index-shang" target="_blank" data-smartkarma-citation="entities:35347:1" rel="noopener">CSI 500</a>, <a href="https://www.smartkarma.com/entities/sse-science-and-technology-innovation-board-50-index" target="_blank" data-smartkarma-citation="entities:29279:1" rel="noopener">STAR50</a>, <a href="https://www.smartkarma.com/entities/shanghai-stock-exchange-sse-50-a-share-index" target="_blank" data-smartkarma-citation="entities:31073:1" rel="noopener">SSE50</a> and a bunch of other mainland China indices will be announced after market close on Friday.</li>
<li>Relatively quiet week for ETF flows with no major creations or redemptions during the week.</li>
</ul>


The FRTIB benchmark switch from the EAFE Index to the ACWI IMI ex-USA ex-China ex-Hong Kong Index will result in a round trip trade of around US$56bn.
The changes for the CSI 300, CSI 500, STAR50, SSE50 and a bunch of other mainland China indices will be announced after market close on Friday.
Relatively quiet week for ETF flows with no major creations or redemptions during the week.


Index Rebalance & ETF Flow Recap: FRTIB, Japan, CSI300, CSI500, STAR50, WuXi XDC, Asahi

Global Healthcare Analyst

Tina Banerjee

Thematic (Sector/Industry)

<ul>
<li>
<a href="https://www.smartkarma.com/entities/samsung-biologics-co-ltd" target="_blank" data-smartkarma-citation="entities:22932:1" rel="noopener">Samsung Biologics (207940 KS)</a> signed a contract manufacturing agreement worth KRW1.7T ($1.2B) with an Asian pharmaceutical company. <a href="https://www.smartkarma.com/entities/celltrion-inc" target="_blank" data-smartkarma-citation="entities:991:1" rel="noopener">Celltrion Inc (068270 KS)</a> has announced KRW100B ($72M) share buyback, starting October 28.</li>
<li>
<a href="https://www.smartkarma.com/entities/astellas-pharma-inc" target="_blank" data-smartkarma-citation="entities:6091:1" rel="noopener">Astellas Pharma (4503 JP)</a> received FDA approval for Vyloy for gastric cancer. <a href="https://www.smartkarma.com/entities/shionogi-co-ltd" target="_blank" data-smartkarma-citation="entities:19535:1" rel="noopener">Shionogi &amp; Co (4507 JP)</a> received FDA Fast Track designation for its RSV drug candidate, S-337395.</li>
<li>
<a href="https://www.smartkarma.com/entities/zai-lab-ltd-94df40cf-c15e-462f-b3de-8d2d434ae935" target="_blank" data-smartkarma-citation="entities:36261:1" rel="noopener">Zai Lab (9688 HK)</a> announced positive topline data from global Phase 1a/1b study of ZL-1310 in small cell lung cancer. <a href="https://www.smartkarma.com/entities/legend-biotech-corp" target="_blank" data-smartkarma-citation="entities:28963:1" rel="noopener">Legend Biotech Corp (LEGN US)</a> sheds Genscript Biotech as its majority shareholder.</li>
</ul>



Samsung Biologics (207940 KS) signed a contract manufacturing agreement worth KRW1.7T ($1.2B) with an Asian pharmaceutical company. Celltrion Inc (068270 KS) has announced KRW100B ($72M) share buyback, starting October 28.

Astellas Pharma (4503 JP) received FDA approval for Vyloy for gastric cancer. Shionogi &amp; Co (4507 JP) received FDA Fast Track designation for its RSV drug candidate, S-337395.

Zai Lab (9688 HK) announced positive topline data from global Phase 1a/1b study of ZL-1310 in small cell lung cancer. Legend Biotech Corp (LEGN US) sheds Genscript Biotech as its majority shareholder.


APAC Healthcare Weekly (Oct 27)- Samsung Biologics, Celltrion, Astellas, Otsuka, Legend, and Zai Lab

<ul>
<li>
<a href="https://www.smartkarma.com/entities/varex-imaging-corp" target="_blank" data-smartkarma-citation="entities:28738:1" rel="noopener">Varex Imaging Corp (VREX US)</a> reported 10% YoY drop in revenue and a squeeze in profits as well in Q3FY24, driven by weakness in Medical segment business.</li>
<li>China market softness continues to drag the operating performance of the company. The woes faced in China does not appear to subside quickly in the near foreseeable future.</li>
<li>The company has guided for Q4FY24 sales and EPS in the range of $190-210M and $0.00-0.15, respectively, representing significant drop from year-ago quarter.</li>
</ul>



Varex Imaging Corp (VREX US) reported 10% YoY drop in revenue and a squeeze in profits as well in Q3FY24, driven by weakness in Medical segment business.
China market softness continues to drag the operating performance of the company. The woes faced in China does not appear to subside quickly in the near foreseeable future.
The company has guided for Q4FY24 sales and EPS in the range of $190-210M and $0.00-0.15, respectively, representing significant drop from year-ago quarter.


Varex Imaging Corp (VREX US): No Near-Term Respite Visible From China Headwinds

Global Healthcare Strategist

Vincy Ip

<ul>
<li>Brain disorders, including various neurological and mental diseases, are the hidden danger with the largest social burden among all diseases. </li>
<li>With strong government support across the globe and accelerating private financing, we identify four key areas of investment opportunities in brain science, including neurotherapeutics, neurodiagnostics, neurosurgery, and brain-computer interface (BCI).</li>
<li>Even though the concept of BCI looks promising, its scalability, application, and monetisation potential remain uncertain in the near term and hence the invesmtent risks would be high. </li>
</ul>


Brain disorders, including various neurological and mental diseases, are the hidden danger with the largest social burden among all diseases. 
With strong government support across the globe and accelerating private financing, we identify four key areas of investment opportunities in brain science, including neurotherapeutics, neurodiagnostics, neurosurgery, and brain-computer interface (BCI).
Even though the concept of BCI looks promising, its scalability, application, and monetisation potential remain uncertain in the near term and hence the invesmtent risks would be high. 


Brain Science - An Opportunity or a Trap?

China

Shanghai United Imaging Healthcare Co., Ltd. develops, manufactures, and distributes medical imaging systems and equipment. The Company produces computed tomography scanners, mobile medical devices, molecular imaging instruments, magnetic resonance equipment, and others. Shanghai United Imaging Healthcare also offers equipment leasing services.

Shanghai United Imaging Health (688271 CH)

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Shanghai United Imaging Health (688271 CH)

China Healthcare Weekly (Mar.22)-TCM Injection Revive, China CXO Lag Behind in GLP-1, United Imaging

TCM injection market would end its years of decline and enter a period of rapid growth again. As MNCs rethink supply chain issues, China CXOs would...

Xinyao (Criss) Wang

Index Rebalance & ETF Flow Recap: FRTIB, Japan, CSI300, CSI500, STAR50, WuXi XDC, Asahi

This recap highlights Insights covering Asian index rebalances (announcements/ forecasts/ IPO Fast Entry/ M&A driven changes). We also highlight...

Brian Freitas

APAC Healthcare Weekly (Oct 27)- Samsung Biologics, Celltrion, Astellas, Otsuka, Legend, and Zai Lab

Samsung Biologics secures largest ever contract, Celltrion announced KRW100B buyback, Astellas Pharma got label expansion approval for Vyloy,...

Tina Banerjee

Varex Imaging Corp (VREX US): No Near-Term Respite Visible From China Headwinds

Varex Imaging reports 10% YoY revenue drop in Q3FY24 due to China market softness, which is expected to continue in near-term. Q4FY24 guidance...

Tina Banerjee

Brain Science - An Opportunity or a Trap?

We identify four key areas of investment opportunities in brain science, including neurotherapeutics, neurodiagnostics, neurosurgery, and brain...

Vincy Ip

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

China Healthcare Weekly (Mar.22)-TCM Injection Revive, China CXO Lag Behind in GLP-1, United Imaging

TCM injection market would end its years of decline and enter a period of rapid growth again. As MNCs rethink supply chain issues, China CXOs would...

Xinyao (Criss) Wang

Index Rebalance & ETF Flow Recap: FRTIB, Japan, CSI300, CSI500, STAR50, WuXi XDC, Asahi

This recap highlights Insights covering Asian index rebalances (announcements/ forecasts/ IPO Fast Entry/ M&A driven changes). We also highlight...

Brian Freitas

APAC Healthcare Weekly (Oct 27)- Samsung Biologics, Celltrion, Astellas, Otsuka, Legend, and Zai Lab

Samsung Biologics secures largest ever contract, Celltrion announced KRW100B buyback, Astellas Pharma got label expansion approval for Vyloy,...

Tina Banerjee

Varex Imaging Corp (VREX US): No Near-Term Respite Visible From China Headwinds

​Varex Imaging reports 10% YoY revenue drop in Q3FY24 due to China market softness, which is expected to continue in near-term. Q4FY24 guidance...

Tina Banerjee

Brain Science - An Opportunity or a Trap?

We identify four key areas of investment opportunities in brain science, including neurotherapeutics, neurodiagnostics, neurosurgery, and brain...

Vincy Ip

Varex Imaging reports 10% YoY revenue drop in Q3FY24 due to China market softness, which is expected to continue in near-term. Q4FY24 guidance...