In today’s briefing:
- What Now For BEA After Elliott Walks?
- Kuaishou: Livestreaming E-Commerce Expands and Losses to Narrow; Further Upside Seems Likely
- Macro; Rating Changes; New Issues; Talking Heads; Top Gainers and Losers
- Pre-IPO Shanghai NewMed Medical – Concerns on Fierce Competition and Future Commercialization
What Now For BEA After Elliott Walks?
- Bank of East Asia (23 HK) announced last Friday it intends to buy back 8.43% of shares out from Elliott Investment Management for HK$2.9bn ($373mn), paying HK$11.19/share.
- The share buyback is expected to result in a 6% increase in the consolidated net asset value per share.
- Conditions to the buyback appear straightforward. BEA is trading cheap at 0.3x P/B.
Kuaishou: Livestreaming E-Commerce Expands and Losses to Narrow; Further Upside Seems Likely
- Kuaishou’s share price has climbed more than 20.0% YTD as the company has increased its focus on e-commerce while also narrowing down its costs.
- The company opened its e-commerce store to local merchants in China including food delivery, healthcare, hospitality and entertainment ticketing.
- According to news media outlets, the e-commerce GMV hit RMB650bn (US$102bn) in 2021 from RMB381bn in 2020. This figure is expected to go up to RMB900bn in 2022E.
Macro; Rating Changes; New Issues; Talking Heads; Top Gainers and Losers
US equity markets saw a sharp rally on Friday with the S&P and Nasdaq ending 2.4% and 3.1% higher. Sectoral gains were led by IT and Real Estate, up 4.3% and 3.4% each. US 10Y Treasury yields eased 2bp at 1.79%. European markets recovered with the DAX, CAC and FTSE down 1.3%, 0.8% and 1.2%. Brazil’s Bovespa closed 0.6% higher. In the Middle East, UAE’s ADX was up 0.4% and Saudi TASI closed 0.7% higher on Sunday. Asian markets have opened broadly higher with HSI, STI and Nikkei up 1.3%, 0.5% and 1.5% while Shanghai was down 1%. US IG CDS spreads were 1.3bp wider and HY CDS spreads were 5.1bp tighter, EU Main CDS spreads were 1.7bp wider and Crossover CDS spreads were 5.7bp wider. Asia ex-Japan CDS spreads were 1.6bp wider.
Pre-IPO Shanghai NewMed Medical – Concerns on Fierce Competition and Future Commercialization
- From Shanghai NewMed Medical (NMM HK)’s pipeline, it can be seen that almost all the candidates do not have obvious advantages in development progress in front of the competing products.
- NewMed has little experience in launching and commercializing product candidates, especially as a late-comer. So, the actual commercialization performance could be lower than expected.
- Since there are so many uncertainties as well as the poor market sentiment for new IPOs in HKEX, we are conservative about the outlook of NewMed at the current stage.
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