China: NIO Inc, Edvantage Group, Bilibili Inc, China Infrastructure & Logistics Group , Kwg Property Holding and more

• NIO announced that it would look to list in the HK by way of introduction with trading set to begin on 10th March 2022.
• Unlike a secondary or a dual primary listing, there will be no new capital raised and there will be no secondary shares sold either.
• In this note we take a quick look at the deal dynamics.

• Edvantage Group (382 HK), a play on higher education and vocation in China, now trades at 4.9x FY22e/3.8x FY23e. Concerns over the regulatory overhang are overdone, although they do exist.
• With a 30% payout ratio, the stock now trades at dividend yields of 6.1% FY22e/7.9% FY23e, assuming an EPS CAGR of 30% from FY21-23e. 
• The company continues to execute positively in its release in Q1 FY22 with a 62% increase in gross profits YoY, and it has low gearing at 21.7%  net debt/equity. 

• The paying user base continued growing in 4Q21 and has space to grow further.
• Game revenue recovered for the second quarter, as the games launched last year began to earn money.
• BILI’s advertising revenue grew significantly faster than the market size of Chinese online advertising.

• On the 10 January, China Infrastructure & Logistics Group (1719 HK) (“CILG”) has announced a possible MGO from Hubei Ports. The Composite Doc is now out. The Offer is open.
• This transaction is an unconditional mandatory cash offer at HK$1.45/share.
• The first – and likely, last close – is the 25 March.  The Offeror intends to maintain CILG’s listing.

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.

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