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

<ul>
<li>We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of July 7th.</li>
<li>The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.</li>
<li>We analyzed southbound Hong Kong connect flows in the past week and highlight flows for  China Mobile, ICBC, ABC, Tencent, HSBC, BYD.</li>
</ul>


We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of July 7th.
The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.
We analyzed southbound Hong Kong connect flows in the past week and highlight flows for  China Mobile, ICBC, ABC, Tencent, HSBC, BYD.


Hong Kong Connect Flows (Jul 7th): China Mobile, ICBC, ABC, Tencent, HSBC, BYD

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.

Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/jingdong-property-inc" target="_blank" data-smartkarma-citation="entities:36871:1" rel="noopener">JD Property (JDP HK)</a>/JDP, a leading modern infrastructure provider in Asia, has filed for a US$1 billion HKEx IPO. <a href="https://www.smartkarma.com/entities/jd-com-inc-adr" target="_blank" data-smartkarma-citation="entities:446:1" rel="noopener">JD.com Inc (ADR) (JD US)</a> owns a 74.96% stake.</li>
<li>In <em><strong><a href="https://www.smartkarma.com/insights/jd-property-ipo-the-bull-case" target="_blank" data-smartkarma-citation="insights:104496" rel="noopener">JD Property IPO: The Bull Case</a></strong></em>, we highlighted the key elements of the bull case. In this note, we outline the bear case.</li>
<li>The key elements of the bear case rest on the low Fund AUM mix, declining fee rate, EBITDA flattered by FV changes, EBITDA lagging revenue growth, and high cash burn.</li>
</ul>



JD Property (JDP HK)/JDP, a leading modern infrastructure provider in Asia, has filed for a US$1 billion HKEx IPO. JD.com Inc (ADR) (JD US) owns a 74.96% stake.
In JD Property IPO: The Bull Case, we highlighted the key elements of the bull case. In this note, we outline the bear case.
The key elements of the bear case rest on the low Fund AUM mix, declining fee rate, EBITDA flattered by FV changes, EBITDA lagging revenue growth, and high cash burn.


<ul>
<li>
<a href="https://www.smartkarma.com/entities/jingdong-property-inc" target="_blank" data-smartkarma-citation="entities:36871:1" rel="noopener">JD Property (JDP HK)</a>/JDP, a leading modern infrastructure provider in Asia, has filed for a US$1 billion HKEx IPO. <a href="https://www.smartkarma.com/entities/jd-com-inc-adr" target="_blank" data-smartkarma-citation="entities:446:1" rel="noopener">JD.com Inc (ADR) (JD US)</a> owns a 74.96% stake.</li>
<li>JDP is the third and second largest modern infrastructure provider in Asia and China, respectively, in terms of GFA, according to JLL.</li>
<li>The key elements of the bull case rest on large addressable markets, market share gains, reducing dependence on JD Group, core business’ accelerating organic growth and improving margin.</li>
</ul>



JD Property (JDP HK)/JDP, a leading modern infrastructure provider in Asia, has filed for a US$1 billion HKEx IPO. JD.com Inc (ADR) (JD US) owns a 74.96% stake.
JDP is the third and second largest modern infrastructure provider in Asia and China, respectively, in terms of GFA, according to JLL.
The key elements of the bull case rest on large addressable markets, market share gains, reducing dependence on JD Group, core business’ accelerating organic growth and improving margin.


Event-Driven

<ul>
<li>On 20 April, <a href="https://www.smartkarma.com/entities/yuexiu-property-co-ltd" target="_blank" data-smartkarma-citation="entities:18097:1" rel="noopener">Yuexiu Property (123 HK)</a> announced plans to raise US$1.1 billion through 30 rights shares for every 100 existing shares rights offering, with a rights price of HK$9.00.</li>
<li>Since the announcement of the rights issue, Yuexiu shares have declined by -23.6% to the undisturbed price and by -18.2% compared to the TERP of HK$11.74 per share.</li>
<li>The shares went ex-rights on 2 May and the rights start trading on 15 May. <a href="https://www.smartkarma.com/entities/link-reit" target="_blank" data-smartkarma-citation="entities:872:1" rel="noopener">Link REIT (823 HK)</a>’s trading over its rights period provides the playbook for Yuexiu’s trading.</li>
</ul>


On 20 April, Yuexiu Property (123 HK) announced plans to raise US$1.1 billion through 30 rights shares for every 100 existing shares rights offering, with a rights price of HK$9.00.
Since the announcement of the rights issue, Yuexiu shares have declined by -23.6% to the undisturbed price and by -18.2% compared to the TERP of HK$11.74 per share.
The shares went ex-rights on 2 May and the rights start trading on 15 May. Link REIT (823 HK)’s trading over its rights period provides the playbook for Yuexiu’s trading.


Yuexiu Property (123 HK): Rights Trade Playbook

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>On Thursday morning, <a href="https://www.smartkarma.com/entities/yuexiu-property-co-ltd" target="_blank" data-smartkarma-citation="entities:18097:1" rel="noopener">Yuexiu Property (123 HK)</a> halted trading in its shares and then later in the day announced a rights offering. Shares fell hard but gained back a little.</li>
<li>The rights offering lowers BVPS by about 11.3% so the current price is "about right" for the fundamentals if the price the day before the news was right.</li>
<li>There are, however, flow dynamics which are of interest. There almost always are.</li>
</ul>


On Thursday morning, Yuexiu Property (123 HK) halted trading in its shares and then later in the day announced a rights offering. Shares fell hard but gained back a little.
The rights offering lowers BVPS by about 11.3% so the current price is "about right" for the fundamentals if the price the day before the news was right.
There are, however, flow dynamics which are of interest. There almost always are.


Hong Kong

Hui Xian Real Estate Investment Trust is a real estate investment trust. The trust's sole real estate investment interest at the time of its listing is its investment interest in the Oriental Plaza in Beijing.

Sunlight Real Estate Investment Trust is a real estate investment trust that invests in a portfolio of office and retail properties throughout Hong Kong.

Spring Real Estate Investment Trust is a real estate investment trust formed primarily to own and invest in high quality income-producing real estate in Asia.

Prosperity REIT is a real estate investment trust formed primarily to own and invest in commercial properties, with exposure to the office and industrial office sectors in Hong Kong.

Regal Real Estate Investment Trust is a real estate investment trust that invests in hotel properties.

Regal Real Estate Investment Trust (1881 HK)

China Merchants Commercial Real Estate Investment Trust operates as a Hong Kong collective investment scheme. The Company invests primarilyin income-generating properties and uses the income to provide stable returns to itsunitholders. China Merchants Commercial Real Estate Investment Trust provides services in Hong Kong.

China Merchants Commercial REIT (1503 HK)

C C Land Holdings Limited, through its subsidiaries, develops and invests in properties in Western China. The company also manufactures and trades packaging products and luggage, and invests in treasuries as well.

Poly Property Group Co., Ltd. develops, invests in, and manages properties in China.  The Company develops mid- to high-end residential and commercial projects in first-tier and second-tier provincial capitals in Central and Southwestern China.

Tian An China Investments Co Ltd, through its subsidiaries, develops and manages properties, and provides agency services.  The Company also sells construction materials.

K Wah International Holdings Limited is principally involved in property development and investment in Hong Kong, Mainland China and Singapore. The Company also holds an interest in Galaxy Entertainment Group.

Frasers Hospitality Trust operates as a real estate investment trust. The Trust owns, operates and invests in hotels and serviced residences.

Universal Health Realty Income Trust is a real estate investment trust that invests in healthcare and human service related facilities, including acute care hospitals, behavioral healthcare facilities, rehabilitation hospitals, sub-acute care facilities, surgery centers, childcare centers and medical office buildings.

Universal Health Realty Income Trust (UHT US)

Charter Hall Social Infrastructure REIT operates as a real estate investment trust. The Company invests in social infrastructure properties, as well as provides assets and capital management services. Charter Hall Social Infrastructure serves clients in Australia and New Zealand.

Charter Hall Social Infrastructure REIT (CQE AU)

Summit Hotel Properties, Inc. is a real estate investment trust.  The trust invests in hotels in the United States that do not serve food and beverages and serve the middle and upscale markets.  Most of the hotels are franchised from brand name hotel companies.

Whitestone REIT is a real estate investment trust.  The Trust invests in and operates retail, industrial and office properties.

Global One Real Estate Investment Corp., Ltd. is a real estate investment trust (REIT) that invests in income producing properties.  The Company mainly invests in office buildings in metropolitan, Chubu, and Kinki areas.

Global One Real Estate Investment Corp (8958 JP)

Hankyu Hanshin REIT, Inc. is a real estate investment trust (REIT). The Company invests in real estate properties such as commercial and office buildings.

Axis Real Estate Investment Trust is a real estate investment trust that owns and invests in a portfolio of commercial, office and office/retail real estate located in Malaysia. The portfolio includes Axis Business Park, Menara Axis, Crystal Plaza, Infinite Centre and Axis Plaza.

Gladstone Commercial Corporation was created to invest in and own net leased industrial and commercial real estate property and making long-term industrial and commercial mortgage loans.  The company is actively seeking and evaluating properties for potential acquisition or mortgage financing.

Property for Industry Limited is a property company that invests in New Zealand industrial properties. The Company's property portfolio includes sites in Auckland, Hamilton, Tauranga, Wellington and Christchurch.

Yuexiu Real Estate Investment Trust invests in a diverse portfolio of income producing properties which are used primarily for office, retail, and other commercial purposes in China.

Yuexiu Real Estate Investment Trust (405 HK)

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Yuexiu Real Estate Investment Trust (405 HK)

Hong Kong Connect Flows (Jul 7th): China Mobile, ICBC, ABC, Tencent, HSBC, BYD

We analyzed the Hong Kong Connect Scheme for last week and highlight flows for China Mobile, ICBC, ABC, Tencent, HSBC, BYD.

Ke Yan, CFA, FRM

JD Property IPO: The Bear Case

The key elements of the bear case rest on the low Fund AUM mix, declining fee rate, EBITDA flattered by FV changes, EBITDA lagging the revenue...

Arun George

JD Property IPO: The Bull Case

The key elements of the bull case rest on large addressable markets, market share gains, reducing dependence on JD Group, core business’...

Arun George

Yuexiu Property (123 HK): Rights Trade Playbook

Yuexiu shares have declined by -18.2% compared to the TERP of HK$11.74 per share. Link REIT’s trading over its rights period provides the playbook...

Arun George

Yuexiu Property (123 HK) Rights Offering

Yuexiu Property is conducting a rights offer. The stock has fallen the amount it "needs" to in order to account for BVPS dilution. Next, there...

Travis Lundy

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