Equity Analyst, LightStream Research

Shifara Samsudeen, ACMA, CGMA

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Equity Capital Markets

Joinn Laboratories China  Lt / Equity Capital Markets

<p><a href="https://www.smartkarma.com/entities/joinn-laboratories-china-co-a" target="_blank" data-smartkarma-citation="entities:28273:1" rel="noopener">Joinn Laboratories China Co-A (603127 CH)</a> , the pioneer of commercial GLP laboratories in China has filed for a secondary listing to list its shares on the Hong Kong Stock Exchange. The company plans to issue 43.3m shares at an indicative IPO price range of HK$133-151 per share. At the above indicative price range, the company will raise net proceeds of HK$4.8-5.5bn (approx. US$625-710m). Joinn Laboratories shares are currently trading at RMB161.35 per share on the Shenzhen Stock Exchange (approx. HK$137 per share at an exchange rate of 0.83RMB/HK$).</p><p>The company intends to use the above proceeds on expanding the service capacity of its Suzhou facilities, strengthen its operations in the US (Biomere), further strengthening and expanding its facility network and service capabilities and broaden and deepen the company’s integrated CRO service offerings.</p><p>In our previous insight on the company’s IPO, we discussed Joinn Laboratories’ business model, segments and financials. Refer the extract below from our previous insight:</p><div class="content-highlight"><p><em>China’s CRO market is expanding rapidly and Joinn Laboratories stands to benefit from being the market leader in China’s non-clinical drug safety assessment services industry. The company’s revenues have seen strong growth over the past 2-3 years and the company has taken several initiatives to expand its revenue base through the launch of new services and also expanding into overseas markets. Although the company’s gross margin has declined slightly, due to expanding revenues from non-drug safety assessment services, we expect the company’s GPM to improve in the medium-term with clinical trials and related services achieving more scale. We will discuss the company’s valuation and risks in a follow-up insight</em></p></div>

Joinn Laboratories China Co-A (603127 CH) , the pioneer of commercial GLP laboratories in China has filed for a secondary listing to list its shares on the Hong Kong Stock Exchange. The company plans to issue 43.3m shares at an indicative IPO price range of HK$133-151 per share. At the above indicative price range, the company will raise net proceeds of HK$4.8-5.5bn (approx. US$625-710m). Joinn Laboratories shares are currently trading at RMB161.35 per share on the Shenzhen Stock Exchange (approx. HK$137 per share at an exchange rate of 0.83RMB/HK$).The company intends to use the above proceeds on expanding the service capacity of its Suzhou facilities, strengthen its operations in the US (Biomere), further strengthening and expanding its facility network and service capabilities and broaden and deepen the company’s integrated CRO service offerings.In our previous insight on the company’s IPO, we discussed Joinn Laboratories’ business model, segments and financials. Refer the extract below from our previous insight:China’s CRO market is expanding rapidly and Joinn Laboratories stands to benefit from being the market leader in China’s non-clinical drug safety assessment services industry. The company’s revenues have seen strong growth over the past 2-3 years and the company has taken several initiatives to expand its revenue base through the launch of new services and also expanding into overseas markets. Although the company’s gross margin has declined slightly, due to expanding revenues from non-drug safety assessment services, we expect the company’s GPM to improve in the medium-term with clinical trials and related services achieving more scale. We will discuss the company’s valuation and risks in a follow-up insight

JOINN Laboratories IPO: Attractive Valuation; Overseas Expansion Should Open Up Room for LT Growth

Sciclone Pharmaceuticals / Equity Capital Markets

<p><a href="https://www.smartkarma.com/entities/sciclone-pharmaceuticals-holdings-limited" target="_blank" data-smartkarma-citation="entities:17351:1" rel="noopener">Sciclone Pharmaceuticals (1863447D HK)</a> , a biopharmaceutical company with an integrated platform for product development and commercialisation has filed for an IPO on the Hong Kong Stock Exchange to raise about US$500m.</p><p>The company focuses on oncology and severe infection as its key focus areas, two of the largest and fastest growing therapeutic areas in China. The company already has been generating revenues from the sale of its proprietary product Zadaxin, and at the same time, it also makes revenues from the sale of in-licensed products as well as from promotion products on behalf of its business partners in China.</p><p>Though Zadaxin possesses the first mover advantage as the first branded thymalfasin drug in China, we remain concerned about the future prospects for Zadaxin if it is chosen for volume-based procurement catalog in China.</p>

Sciclone Pharmaceuticals (1863447D HK) , a biopharmaceutical company with an integrated platform for product development and commercialisation has filed for an IPO on the Hong Kong Stock Exchange to raise about US$500m.The company focuses on oncology and severe infection as its key focus areas, two of the largest and fastest growing therapeutic areas in China. The company already has been generating revenues from the sale of its proprietary product Zadaxin, and at the same time, it also makes revenues from the sale of in-licensed products as well as from promotion products on behalf of its business partners in China.Though Zadaxin possesses the first mover advantage as the first branded thymalfasin drug in China, we remain concerned about the future prospects for Zadaxin if it is chosen for volume-based procurement catalog in China.

SciClone Pharmaceutical IPO: Future Prospects for Zadaxin Troubling

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.

Basecare Medical Device / Equity Capital Markets

<div><p><a href="https://www.smartkarma.com/entities/basecare-medical-device-co-l" target="_blank" data-smartkarma-citation="entities:31086:1" rel="noopener">Basecare Medical Device (2170 HK)</a> has developed a portfolio of genetic test kits that cover all key stages of the reproductive cycle. The initial focus of the product portfolio was on helping couples address infertility problems and increase their chances of having a healthy baby through IVF (in vitro fertilization) procedures. Basecare will commence trading on Monday, 08 February. Basecare priced its IPO at HK$27.36 and <a href="http://www.aastocks.com/en/stocks/news/aafn-con/NOW.1074764/ipo-news" target="_blank" rel="noopener">closed 14% up at HK$31.20</a> in the grey market.</p></div><div><p>In <a href="https://www.smartkarma.com/insights/suzhou-basecare-medical-ipo-initiation-improving-ivf" target="_blank" data-smartkarma-citation="insights:47352" rel="noopener">Suzhou Basecare Medical IPO Initiation: Improving IVF</a>, we stated that with a large addressable market opportunity and Basecare’s early mover advantage, we believe that Basecare’s fundamentals are attractive. In <a href="https://www.smartkarma.com/insights/suzhou-basecare-medical-ipo-valuation-insights" target="_blank" data-smartkarma-citation="insights:47473" rel="noopener">Suzhou Basecare Medical IPO: Valuation Insights</a>, we noted that the IPO price range is attractive.</p></div><div><div><div class="content-highlight"><p>Updating for the final IPO net raise, our base-case DCF derived price target of HK$33.07 per share. As DCF-based target prices are subject to a wide range of variability, we present a sensitivity table to help investors gauge where target prices could head. Our DCF sensitivity analysis shows that the IPO price is attractive.</p></div></div></div>

Basecare Medical Device (2170 HK) has developed a portfolio of genetic test kits that cover all key stages of the reproductive cycle. The initial focus of the product portfolio was on helping couples address infertility problems and increase their chances of having a healthy baby through IVF (in vitro fertilization) procedures. Basecare will commence trading on Monday, 08 February. Basecare priced its IPO at HK$27.36 and closed 14% up at HK$31.20 in the grey market.In Suzhou Basecare Medical IPO Initiation: Improving IVF, we stated that with a large addressable market opportunity and Basecare’s early mover advantage, we believe that Basecare’s fundamentals are attractive. In Suzhou Basecare Medical IPO: Valuation Insights, we noted that the IPO price range is attractive.Updating for the final IPO net raise, our base-case DCF derived price target of HK$33.07 per share. As DCF-based target prices are subject to a wide range of variability, we present a sensitivity table to help investors gauge where target prices could head. Our DCF sensitivity analysis shows that the IPO price is attractive.

Suzhou Basecare Medical IPO: Trading Debut

New Horizon Health  / Equity Capital Markets

<p><a href="https://www.smartkarma.com/entities/new-horizon-health-limited" target="_blank" data-smartkarma-citation="entities:31039:1" rel="noopener">New Horizon Health (NHH HK)</a>  operates in the Chinese colorectal cancer screening market. The company’s proprietary cancer screening product, ColoClear is the first and only molecular cancer screening test approved by the NMPA.</p><p>In addition to the company’s proprietary screening test, ColoClear, the company also has Pupu Tube, a non-invasive, stool-based FIT test, which is the first self-conducted FIT screening product approved by the NMPA in China.</p><p>The company has filed for an IPO to list its shares on the Hong Stock Exchange and according to the Bloomberg, the company plans to raise about US$300m.</p><p>In our previous insight on the company’s IPO, we discuss the company’s business, its product pipeline and outlook. In this follow-up insight, we have highlighted and discussed some of the key new data points from the company’s Post Hearing Information Pack (PHIP).</p>

New Horizon Health (NHH HK)  operates in the Chinese colorectal cancer screening market. The company’s proprietary cancer screening product, ColoClear is the first and only molecular cancer screening test approved by the NMPA.In addition to the company’s proprietary screening test, ColoClear, the company also has Pupu Tube, a non-invasive, stool-based FIT test, which is the first self-conducted FIT screening product approved by the NMPA in China.The company has filed for an IPO to list its shares on the Hong Stock Exchange and according to the Bloomberg, the company plans to raise about US$300m.In our previous insight on the company’s IPO, we discuss the company’s business, its product pipeline and outlook. In this follow-up insight, we have highlighted and discussed some of the key new data points from the company’s Post Hearing Information Pack (PHIP).

Cloopen Group Holding Ltd / Equity Capital Markets

<p><a href="https://www.smartkarma.com/entities/cloopen-group-holding-ltd" target="_blank" data-smartkarma-citation="entities:31315:1" rel="noopener">Cloopen Group Holding Ltd (RAAS US)</a> , the cloud communication solutions provider in China, has filed for an IPO to list its shares in the US. According to the CIC Report, the company was ranked the largest multi-capability cloud-based communication solutions provider in China, as measured by revenues in 2019.</p><p>In our previous insight on the company’s IPO, we examined the company’s business model, its segments and revenues. Refer the extract below from our previous insight:</p><div class="content-highlight"><p><em>The company was ranked the largest multi-capability cloud-based communication provider in China in 2019 and generates a majority of its revenues from large enterprises which accounted for 75.7% of total revenues during 9M2020. The company offers a comprehensive portfolio of cloud-communication services and has the capability to serve a broad range of customers. This we believe places the company in a better position to serve its customers than peers. Cloopen also has acquired several businesses while also has expanded its operations into Japan. The company is also in the process of expanding into regions and countries in Southeast Asia, which we believe will further fuel growth for the company</em></p></div><p>In this follow-up insight, we discuss the company’s cost and margin profile.</p>

Cloopen Group Holding Ltd (RAAS US) , the cloud communication solutions provider in China, has filed for an IPO to list its shares in the US. According to the CIC Report, the company was ranked the largest multi-capability cloud-based communication solutions provider in China, as measured by revenues in 2019.In our previous insight on the company’s IPO, we examined the company’s business model, its segments and revenues. Refer the extract below from our previous insight:The company was ranked the largest multi-capability cloud-based communication provider in China in 2019 and generates a majority of its revenues from large enterprises which accounted for 75.7% of total revenues during 9M2020. The company offers a comprehensive portfolio of cloud-communication services and has the capability to serve a broad range of customers. This we believe places the company in a better position to serve its customers than peers. Cloopen also has acquired several businesses while also has expanded its operations into Japan. The company is also in the process of expanding into regions and countries in Southeast Asia, which we believe will further fuel growth for the companyIn this follow-up insight, we discuss the company’s cost and margin profile.

Cloopen Group IPO: Seems to Follow the Right Path to Profits

China

Suzhou Basecare Medical Corporation Limited operates as a genetic technology researching company. The Company provides a comprehensive clinical solution for reproductive health. Suzhou Basecare Medical also develops and markets innovative medical devices.

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Suzhou Basecare Medical (1862702D CH)

JOINN Laboratories IPO: Attractive Valuation; Overseas Expansion Should Open Up Room for LT Growth

Joinn Laboratories, the pioneer of commercial GLP laboratories in China has filed for a secondary listing to list its shares on the Hong Kong Stock...

Shifara Samsudeen, ACMA, CGMA

SciClone Pharmaceutical IPO: Future Prospects for Zadaxin Troubling

SciClone Pharmaceuticals, a biopharmaceutical company with an integrated platform for product development and commercialisation has filed for an...

Shifara Samsudeen, ACMA, CGMA

Suzhou Basecare Medical IPO: Trading Debut

Basecare priced its IPO at HK$27.36 and closed 14% up at HK$31.20 in the grey market. Our DCF sensitivity analysis shows that the IPO price is...

Arun George

New Horizon Health IPO: PHIP Updates

New Horizon Health operates in the Chinese colorectal cancer screening market. The company has filed for an IPO on the HKEX and plans to raise...

Shifara Samsudeen, ACMA, CGMA

Cloopen Group IPO: Seems to Follow the Right Path to Profits

Cloopen Group, the cloud communication solutions provider in China, has filed for an IPO to list its shares in the US. In this insight, we discuss...

Shifara Samsudeen, ACMA, CGMA

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