Overseas Chinese Equities, Aequitas Research

Ming Lu

Overseas Chinese Equities

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.

Equity Bottom-Up

<ul>
<li>Short video continued to accumulate active users in China and the company’s light-version grew the most rapidly.</li>
<li>We believe the revenue growth rate will rise from 2Q23 and the company will have positive operating profit from 2024.</li>
<li>We set the price target at HK$103, which is 44% over the market price.</li>
</ul>


Short video continued to accumulate active users in China and the company’s light-version grew the most rapidly.
We believe the revenue growth rate will rise from 2Q23 and the company will have positive operating profit from 2024.
We set the price target at HK$103, which is 44% over the market price.


Kuaishou (1024 HK): Expanding Market, Will See Higher Growth and Profit

APAC IPOs & Placements, Aequitas Research

Ethan Aw

APAC IPOs & Placements

Equity Capital Markets

<ul>
<li>Wuxi Biologics Holdings is looking to raise up to US$513m by selling about 1.3% of <a href="https://www.smartkarma.com/entities/wuxi-apptec" target="_blank" data-smartkarma-citation="entities:23679:1" rel="noopener">Wuxi Biologics (2269 HK). </a>
</li>
<li>This is the company's 16th placement since it listed in June 2017. </li>
<li>In this note, we will discuss deal dynamics, past deal performance, and share the scores on our ECM framework.</li>
</ul>


Wuxi Biologics Holdings is looking to raise up to US$513m by selling about 1.3% of Wuxi Biologics (2269 HK). 

This is the company's 16th placement since it listed in June 2017. 
In this note, we will discuss deal dynamics, past deal performance, and share the scores on our ECM framework.


Wuxi Biologics Placement - Lesser Discount than Recent Deals but Still Looks Good

Pan-Asia Index Flows & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Pan-Asia Index Flows & Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Event-Driven

<ul>
<li>The <a href="https://www.smartkarma.com/entities/hang-seng-china-enterprises-index" target="_blank" data-smartkarma-citation="entities:22900:1" rel="noopener">Hang Seng China Enterprises Index (HSCEI INDEX)</a> is one of the most widely discussed indices in the Hang Seng Indices family.</li>
<li>The HSCEI serves as a benchmark to reflect the overall performance of "Mainland" Securities listed in Hong Kong.</li>
<li>In this insight, we take a brief look at the selection criteria and the historical price performance of past Rebalance Events.</li>
</ul>


The Hang Seng China Enterprises Index (HSCEI INDEX) is one of the most widely discussed indices in the Hang Seng Indices family.
The HSCEI serves as a benchmark to reflect the overall performance of "Mainland" Securities listed in Hong Kong.
In this insight, we take a brief look at the selection criteria and the historical price performance of past Rebalance Events.


Quiddity Primer for HSCEI Rebalance Events

<ul>
<li>The Chinese government may possibly buy minor shares in Alibaba and Tencent.</li>
<li>JD.com’s long-term competitor, Dangdang, opened a bookstore in JD.com's app.</li>
<li>In 2022, both Tencent Video Account's active user base and time on site reached 80% of We Chat.</li>
</ul>


The Chinese government may possibly buy minor shares in Alibaba and Tencent.
JD.com’s long-term competitor, Dangdang, opened a bookstore in JD.com's app.
In 2022, both Tencent Video Account's active user base and time on site reached 80% of We Chat.


China Internet Weekly (16Jan2023): Alibaba, Tencent, JD.com, ByteDance

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.

Thematic (Sector/Industry)

<ul><li>China online game market revenue decreased by 10% YoY to RMB266bn in 2022 (2021: +6% YoY), as per CNG.</li><li>Apart from high base impact, the main causes were the suspension of game license approval and strengthening minor protection.</li><li>4Q22 China online gaming revenue continued to decline by 2% QoQ and 19% YoY to RMB58bn (3Q22: -19% YoY). </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>

China online game market revenue decreased by 10% YoY to RMB266bn in 2022 (2021: +6% YoY), as per CNG.Apart from high base impact, the main causes were the suspension of game license approval and strengthening minor protection.4Q22 China online gaming revenue continued to decline by 2% QoQ and 19% YoY to RMB58bn (3Q22: -19% YoY). 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.

China Internet – 2022 online game market recap

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 (700 HK)

Kuaishou (1024 HK): Expanding Market, Will See Higher Growth and Profit

Short video continued to accumulate active users in China and the company’s light-version grew the most rapidly. We believe the revenue growth rate...

Ming Lu

Wuxi Biologics Placement - Lesser Discount than Recent Deals but Still Looks Good

Wuxi Biologics Holdings is looking to raise up to US$513m by selling about 1.3% of Wuxi Biologics (2269 HK). This is the company's 16th placement...

Ethan Aw

Quiddity Primer for HSCEI Rebalance Events

We evaluated the price and volume performance of 172 past HSCEI Rebalance cases (ADDs and DELs) from September 2008 to December 2022. We believe...

Janaghan Jeyakumar, CFA

China Internet Weekly (16Jan2023): Alibaba, Tencent, JD.com, ByteDance

Central governmental media encourages non-state-owned companies. JD’s competitor, Dangdang, opens a bookstore on JD.com. Tencent Video Account's...

Ming Lu

China Internet – 2022 online game market recap

China online game market revenue decreased by 10% YoY to RMB266bn in 2022 (2021: +6% YoY), as per CNG. Apart from high base impact, the main causes...

CMB International

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