China: Henderson Land Development, Tongwei Co Ltd A, China Longyuan Power, Calb, WM Motor Technology Co Ltd, ABM Investama, OrbusNeich Medical Group, Bharat Petroleum Corp and more

• Samty Residential Investment and LOTTE Reit are inclusions while Hang Lung Properties, Henderson Land Development and New World Development are deletions for the FTSE EPRA Nareit Developed Asia Index.
• There is a large impact on all stocks, but the flow is much higher on the deletions and the stocks could drop and underperform their peers.
• Ichigo Inc (2337 JP) is a surprise non-inclusion and could trade lower today providing an opportunity to buy the stock while waiting for a late inclusion announcement.

• Anhui Conch Cement, China Citic Bank and Tongwei will replace Chongqing Zhifei Biological, Gree Electric Appliances and PetroChina in the FTSE China A50 Index at the close on 17 June.
• All changes are as we expected, but there are still trades to do off the back of the announced changes.
• Estimated one-way index turnover at the rebalance is 2.83% and will result in a one-way trade of CNY1,436m. There is negligible impact of the funding trade on the other stocks.

• China Longyuan Power (916 HK) and China Railway Group Ltd H (390 HK) will replace Smoore International (6969 HK) and Sunny Optical (2382 HK) in the FTSE China 50 Index.
• The adds, deletes, float changes and capping changes will result in one-way turnover estimated at 4.23% and in a one-way trade of HK$2,091m at the close on 17 June.
• Short interest has been increasing gradually on China Railway Group Ltd H (390 HK) while it has spiked on Smoore International (6969 HK). 

• CALB aims to raise around US$1.5bn in its Hong Kong IPO.
• CALB undertakes design, R&D, production and sales of EV batteries and Energy Storage Systems (ESS) products. 
• In this note, we will talk about the not so positive aspects of the deal.

• WM Motor Technology Co Ltd (WMT CH), an EV manufacturer, has filed for a US$1 billion IPO on the HKEx. It recently raised US$595.7 million at a US$7 billion valuation.
• In line with industry trends and listed Chinese peers, WM Motor rapidly grew its vehicle deliveries in 2021. Price increases and a good roadmap support future growth. 
• WM Motor is sub-scale vs peers pointing to an uncertain path to profitability. As the era of being rewarded for growth at any cost is over, the timing feels off.

This month, we provide an update on developments related to the Indonesian bankruptcy regime since November 2017.

The Asia Monthly focuses on providing updates on recent events, information on new issues and spread movements, as well as summarising our top picks, and discussing specific areas of interest in the “In-Focus” section. The Asia Monthly is intended to broaden investors’ understanding of the Asian USD high-yield market.

• OrbusNeich Medical Group (NEICHZ HK) has a rich pipeline with a leadership position in the PCI balloon markets.
• Its global business layout would also help the Company “hedge” the negative domestic policy impact or regulation changes.
• However, the fierce competition, market pattern, industry characteristics, centralized procurement and other concerns should not be neglected.

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

• Bharat Petroleum Corp
• Central China Securities
• Tata Motors ADR