China: Orient Overseas International, Tsingtao Brewery Co Ltd H, Seazen (Formerly Future Land), Alibaba Group, Pinduoduo, Bilibili, Genscript Biotech, AKM Industrial, Calb, Fantasia Holdings Group Co and more

• For Asia Pacific, there are 48 adds/76 deletes for the Standard Indices and 166 adds/147 deletes for the Small Cap Index that will be implemented at the close today.
• The adds have outperformed the deletes on average over the last few weeks/months. A long adds/short deletes trade performed better for Small Caps as compared to the Standard index.
• There are a lot of stocks that will have same-way flow from other index trackers over the next few weeks and there could be a higher impact on these names.

• Fosun aims to raise around US$527m via selling a 3.5% stake in Tsingtao.
• This is not the first selldown by Fosun, we have covered three prior deals in Dec 2020, Apr 2021 and Dec 2021.
• In this note, we will talk about the deal dynamics and run the deal through our ECM framework.

• In this latest installment in a series dating back to March 2018, I’ve analysed 5,500 moves over three years inside CCASS, targeting >5% of shares outstanding of individual stocks. 
• The data continues to bear out the overall underperformance of stocks that exhibit such moves.
• Additionally, the movement of large blocks of shares may illustrate that the beneficial owner of those shares has pledged them as collateral for a loan.

• Alibaba Group (9988 HK)’s 4QFY22 results were yet another disappointment with the company’s revenue growing by 8.9% YoY, a new low after slowing to 9.7% YoY in the previous quarter.
• This was mostly priced-in, considering that 4QFY22 revenue and OP exceeded consensus by 2.3% and 216% respectively.
• However, FY23 and FY24 estimates are still ambitious and there’s a lot of downside risk to consensus from 2QFY22 onwards.

• PDD achieved high growth rates in main businesses and a higher operating margin in 1Q22.
• However, we believe third-party retailers are scared about the logistics problem caused by the lockdown.
• We set a downside of 17% and a price target of US$40.

• BILI dismissed employees in game, e-commerce, and video in May.
• We believe the growth rates of minor businesses will slow down significantly in 1Q22.
• However, the operating margin will improve in 2022 and 2023.

• The CARVYKTI commercialization will bring GenScript increasing revenue and cash flow. Together with the rapid growth of GCT CDMO, it is expected to see gradual improvement in GenScript’s financial performance.
• The complex international relations, geopolitical conflicts and anti-globalization risks could weigh on bullish sentiment in the short term or cause stock prices to fluctuate wildly.
• In the long term, GenScript’s “all-in” on GCT area enables it follow the industry trend closely. So,GenScript have the exponential growth potential in valuation, with possibility of surpassing WuXi Biologics.

• The Scheme Document Document for AKM Industrial (1639 HK), a flexible printed board player, has been despatched.  The Scheme Meeting will be held on the 22nd June. 
• The Offer Price is HK$1.82/share. It will not be increased. No further dividends will be added, 
• Trading tight at a gross/annualised spread of 1.1%/6.4%, assuming payment in early August.

• 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 positive aspects of the deal.

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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