Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

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<p>This week in StubWorld ...</p>
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<p>Cashed-up <a href="https://www.smartkarma.com/entities/ck-hutchison-holdings-ltd" target="_blank" data-smartkarma-citation="entities:132:1" rel="noopener">CK Hutchison Holdings (1 HK)</a> is in the market every day as its shares trade around all-time lows on an implied stub and simple ratio basis.</p>
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<p>Preceding my comments on CKH are the weekly setup/unwind tables for Asia-Pacific Holdcos.</p>
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<p>These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.</p>
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This week in StubWorld ...




Cashed-up CK Hutchison Holdings (1 HK) is in the market every day as its shares trade around all-time lows on an implied stub and simple ratio basis.




Preceding my comments on CKH are the weekly setup/unwind tables for Asia-Pacific Holdcos.


These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.


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

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<li>We analyze statistics on top repurchases over one week, one month, one quarter and one year periods ended on Aug 23rd based on HKEx daily reports.</li>
<li>In the past 7 days, the top 3 companies that repurchased the most shares from the market were Tencent (700 HK), AIA (1299 HK), Samsonite International (1910 HK).</li>
<li>In the past 30 days, the top 3 companies that repurchased the most shares from the market were AIA (1299 HK), Tencent (700 HK), Meituan (3690 HK).</li>
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We analyze statistics on top repurchases over one week, one month, one quarter and one year periods ended on Aug 23rd based on HKEx daily reports.
In the past 7 days, the top 3 companies that repurchased the most shares from the market were Tencent (700 HK), AIA (1299 HK), Samsonite International (1910 HK).
In the past 30 days, the top 3 companies that repurchased the most shares from the market were AIA (1299 HK), Tencent (700 HK), Meituan (3690 HK).


Hong Kong Buybacks Weekly (Aug 23rd): Tencent, Aia, Samsonite International

Equity Bottom-Up

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<li>China announced game approval for the Jan batch. The number of games approved has increased compared to recent months.</li>
<li>The pace of China game approval appears to be accelerating, to the same level as pre-tightening.</li>
<li>Tencent gets one game approved but we don't see that the acceleration of game approval benefits big names proportionally.</li>
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China announced game approval for the Jan batch. The number of games approved has increased compared to recent months.
The pace of China game approval appears to be accelerating, to the same level as pre-tightening.
Tencent gets one game approved but we don't see that the acceleration of game approval benefits big names proportionally.


Tencent/Netease: Game Approval Accelerates, but Not for Big Names

Blue Lotus China New Economy Research, Blue Lotus Research Institute

Eric Wen

Blue Lotus China New Economy Research

China growth and global non-US Internet equities

Blue Lotus Research Institute

Blue Lotus Research is a Hong Kong Type 4 Licensed investment advisory firm focusing on Chinese growth equities and global non-US Internet equities

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<li>US-Led tech chain may push for AI phone features, which itself is a great strategy to pull the tech industry out of doldrums. It will pressure Huawei, in our opinion;</li>
<li>We believe there are other stories unfolding in the AI era, including availability of AI killer apps, the rivalry between super apps and OS vendors, and the growing China/Ex-China chasm.</li>
<li>Our Top Pick is Tencent and Kuaishou. We maintain Xiaomi at SELL.</li>
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US-Led tech chain may push for AI phone features, which itself is a great strategy to pull the tech industry out of doldrums. It will pressure Huawei, in our opinion;
We believe there are other stories unfolding in the AI era, including availability of AI killer apps, the rivalry between super apps and OS vendors, and the growing China/Ex-China chasm.
Our Top Pick is Tencent and Kuaishou. We maintain Xiaomi at SELL.


[Blue Lotus Hardware Sector Update]: What Does AI Phone Bring to the Tech Competition?

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.

<ul><li>We expect Tencent will continue to deliver quality earnings growth in 4Q23E and 2024E, supported by its operating leverage capacity, improving competitive positions in core business segments and incremental contribution from Weixin ecosystem innovation.</li><li>We expect non-IFRS NPM to rise from 21% in FY22 to 28% in FY25E, on favourable revenue mix shift to higher margin business (e.g. Weixin Video Account and mini games) and opex control.</li><li>Despite the potential slowdown in games revenue growth due to seasonality of monetization (especially in 4Q23), we are upbeat on Tencent’s long-term leadership in domestic games market and capability to address overseas games market. </li></ul><p><em>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.</em></p>

We expect Tencent will continue to deliver quality earnings growth in 4Q23E and 2024E, supported by its operating leverage capacity, improving competitive positions in core business segments and incremental contribution from Weixin ecosystem innovation.We expect non-IFRS NPM to rise from 21% in FY22 to 28% in FY25E, on favourable revenue mix shift to higher margin business (e.g. Weixin Video Account and mini games) and opex control.Despite the potential slowdown in games revenue growth due to seasonality of monetization (especially in 4Q23), we are upbeat on Tencent’s long-term leadership in domestic games market and capability to address overseas games market. 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.

Tencent (700 HK) - Weixin Monetization Shows Continuous Progression

China

Tencent Holdings Limited operates as an investment holding company. The Company, through its subsidiaries, provides Internet and mobile value-added services (VAS), online advertising, and e-commerce transactions. Tencent Holdings offers services to users worldwide.

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Tencent Holdings (ADR) (TCEHY US)

StubWorld: CK Hutch's Ongoing Buybacks

CKH looks cheap here priced at 6.8x/0.4x forward PE/PBR, together with a 50% discount to NAV. Expect buybacks to continue. Recommend an outright...

David Blennerhassett

Hong Kong Buybacks Weekly (Aug 23rd): Tencent, Aia, Samsonite International

We analyzed the Hong Kong buyback data in the past week and highlight the top 3 companies that repurchased the most shares were Tencent (700 HK),...

Ke Yan, CFA, FRM

Tencent/Netease: Game Approval Accelerates, but Not for Big Names

China's game approval process is picking up pace, with an increased number of games approved, but big names like Tencent are not benefiting...

Ke Yan, CFA, FRM

[Blue Lotus Hardware Sector Update]: What Does AI Phone Bring to the Tech Competition?

US-led tech chain may drive AI phone features, boosting the industry and pressuring Huawei. Other AI trends include killer apps, super app...

Blue Lotus Research Institute

Tencent (700 HK) - Weixin Monetization Shows Continuous Progression

We expect Tencent will continue to deliver quality earnings growth in 4Q23E and 2024E, supported by its operating leverage capacity, improving...

CMB International

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StubWorld: CK Hutch's Ongoing Buybacks

CKH looks cheap here priced at 6.8x/0.4x forward PE/PBR, together with a 50% discount to NAV. Expect buybacks to continue. Recommend an outright...

David Blennerhassett

Hong Kong Buybacks Weekly (Aug 23rd): Tencent, Aia, Samsonite International

We analyzed the Hong Kong buyback data in the past week and highlight the top 3 companies that repurchased the most shares were Tencent (700 HK),...

Ke Yan, CFA, FRM

Tencent/Netease: Game Approval Accelerates, but Not for Big Names

​China's game approval process is picking up pace, with an increased number of games approved, but big names like Tencent are not benefiting...

Ke Yan, CFA, FRM

[Blue Lotus Hardware Sector Update]: What Does AI Phone Bring to the Tech Competition?

​US-led tech chain may drive AI phone features, boosting the industry and pressuring Huawei. Other AI trends include killer apps, super app...

Blue Lotus Research Institute

Tencent (700 HK) - Weixin Monetization Shows Continuous Progression

We expect Tencent will continue to deliver quality earnings growth in 4Q23E and 2024E, supported by its operating leverage capacity, improving...

CMB International

China's game approval process is picking up pace, with an increased number of games approved, but big names like Tencent are not benefiting...

US-led tech chain may drive AI phone features, boosting the industry and pressuring Huawei. Other AI trends include killer apps, super app...