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>WisdomTree has dropped ESG considerations while selecting stocks for the EMXSOE, CHXSOE and WTEMXC indices.</li>
<li>That results in a lot of inclusions and fewer deletions across indices that will be implemented at the close on 15 March.</li>
<li>The round-trip trade across the indices will exceed US$500m with <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent (700 HK)</a> as the largest buy.</li>
</ul>


WisdomTree has dropped ESG considerations while selecting stocks for the EMXSOE, CHXSOE and WTEMXC indices.
That results in a lot of inclusions and fewer deletions across indices that will be implemented at the close on 15 March.
The round-trip trade across the indices will exceed US$500m with Tencent (700 HK) as the largest buy.


WisdomTree Indexes Special Rebalance: ESG Considerations Dropped

Blue Lotus Non US Internet research, Blue Lotus Research Institute

Ying Pan

Blue Lotus Non US Internet 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

Equity Bottom-Up

<ul>
<li>We expect Tencent to report C4Q23 revenue, IFRS op. profit and IFRS net income in line, (3.3%) and (4.9%) vs. consensus.</li>
<li>The robust topline growth was mainly contributed by fast growing WeChat VA (Video Account) and strong performances of &lt;Dream Star&gt; in December.</li>
<li>We cut our TP to HK$362 to reflect operating margin decline caused by increased sales and marketing. </li>
</ul>


We expect Tencent to report C4Q23 revenue, IFRS op. profit and IFRS net income in line, (3.3%) and (4.9%) vs. consensus.
The robust topline growth was mainly contributed by fast growing WeChat VA (Video Account) and strong performances of &lt;Dream Star&gt; in December.
We cut our TP to HK$362 to reflect operating margin decline caused by increased sales and marketing. 


[Tencent (700 HK, BUY, TP HK$362) TP Change]: Core Business Is Robust While VA Is Expanding Fast

<ul>
<li>On February 15, OpenAI, Google and Amazon launched respective AI advances in video LLM (SORA), long text (Gemini 1.5), and text-to-speech (BASE) abilities. The evolution speed of AI inspired awe;</li>
<li>We estimate rival equivalent of SORA, delivered over cloud, will appear in 4-6 months of time but on-device version will take years.</li>
<li>We suggest 2C AI applications, especially video, will be the prime beneficiary</li>
</ul>


On February 15, OpenAI, Google and Amazon launched respective AI advances in video LLM (SORA), long text (Gemini 1.5), and text-to-speech (BASE) abilities. The evolution speed of AI inspired awe;
We estimate rival equivalent of SORA, delivered over cloud, will appear in 4-6 months of time but on-device version will take years.
We suggest 2C AI applications, especially video, will be the prime beneficiary


[Blue Lotus Technology Sector Update]: LLM Advances Give China and US Both Opportunities

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.

<ul>
<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>
</ul>


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

<ul>
<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>
</ul>


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?

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)

WisdomTree Indexes Special Rebalance: ESG Considerations Dropped

WisdomTree has dropped ESG considerations while selecting stocks for the EMXSOE, CHXSOE and WTEMXC indices. The round-trip trade will be over...

Brian Freitas

[Tencent (700 HK, BUY, TP HK$362) TP Change]: Core Business Is Robust While VA Is Expanding Fast

Tencent's strong revenue growth driven by WeChat VA and <dream star>, but operating margin decline leads to lower price target of HK$362.</dream>

Blue Lotus Research Institute

[Blue Lotus Technology Sector Update]: LLM Advances Give China and US Both Opportunities

OpenAI, Google and Amazon launched respective AI advances in video LLM (SORA), long text (Gemini 1.5), and text-to-speech (BASE) abilities.We...

Blue Lotus Research Institute

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

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

WisdomTree Indexes Special Rebalance: ESG Considerations Dropped

WisdomTree has dropped ESG considerations while selecting stocks for the EMXSOE, CHXSOE and WTEMXC indices. The round-trip trade will be over...

Brian Freitas

[Tencent (700 HK, BUY, TP HK$362) TP Change]: Core Business Is Robust While VA Is Expanding Fast

​Tencent's strong revenue growth driven by WeChat VA and <dream star>, but operating margin decline leads to lower price target of HK$362.</dream>

Blue Lotus Research Institute

[Blue Lotus Technology Sector Update]: LLM Advances Give China and US Both Opportunities

OpenAI, Google and Amazon launched respective AI advances in video LLM (SORA), long text (Gemini 1.5), and text-to-speech (BASE) abilities.We...

Blue Lotus Research Institute

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's strong revenue growth driven by WeChat VA and <dream star>, but operating margin decline leads to lower price target of HK$362.</dream>

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...