Daily Brief China: Agile Property Holdings, Gree Electric Appliances, Leapmotor, Yankuang Energy Group, Chongqing Hongjiu Fruit, ABM Investama, Azure Power Global Ltd, First Pacific Co and more

The Chinese Property Weekly focuses on providing updates in the Chinese real-estate sector, including recent regulatory and company developments, top and bottom performers, rating actions, as well as a list of bond maturities in the next 30 days.

The Chinese Property Weekly focuses on providing updates in the Chinese real-estate sector, including recent regulatory and company developments, top and bottom performers, rating actions, as well as a list of bond maturities in the next 30 days.

• Inside is a recap of movements in the last week relating to the Hong Kong Stock Exchange -Shanghai and Shenzhen Northbound Connect facilities, broken down by company and industry
• Overall, net inflow over the past week was ~US$0.7bn, split between Shanghai (US$0.3bn) and Shenzhen (US$0.4bn).
• The largest inflows were into Gree Electric Appliances (000651 CH) and CATL (300750 CH). The largest outflows were in Industrial Bank (601166 CH) and China Merchants Bank (600036 CH).

• Leapmotor (2007699D HK), a Chinese EV manufacturer, is pre-marketing a US$1.5 billion HKEx IPO, according to press reports.
• We previously discussed the IPO in Leapmotor IPO: The Bull Case, Leapmotor IPO: The Bear Case and Leapmotor IPO: Look Before You Leap. 
• In this note, we present our forecasts and take the first look at Leapmotor’s potential valuation range. 

• Inside is a recap of movements in the last week relating to the Shanghai and Shenzhen-Hong Kong Stock Connect facilities, broken down by company and industry.
• Overall, the net outflow over the past week was ~US$0.1bn, split (-US$0.4bn) for Shanghai and (+US$0.3bn) for Shenzhen.
• The largest inflows were into CNOOC Ltd (883 HK) and Yankuang Energy Group (1171 HK). The largest outflows were in Meituan (3690 HK) and Kuaishou Technology (1024 HK).

• Chongqing Hongjiu Fruit (6689 HK) raised around US$71m in its Hong Kong IPO.
• CHJF’s subscription rates were lackluster with weak coverage on the institutional tranche and the retail portion being undersubscribed.
• However, after applying a discount to the local peer average, we think there still remains some upside for investors given its higher revenue and profitability growth.

The Asia Monthly focuses on providing updates on recent events, information on new issues and spread movements, as well as summarising our top picks. The Asia Monthly is intended to broaden investors’ understanding of the Asian USD high-yield market.

Lucror Analytics Weekly Wraps provide an overview of all Morning Views comments and reports published by our analyst team in the past week, and also showcase a list of the most-read reports.

In this Insight:

1. ABM Investama
2. China Jinmao Holdings
3. Lifestyle International Holdings
4. Geely Auto
5. First Pacific Co

and more…

In our view, First Pacific’s H1/22 results were robust. All investee companies performed well, with the two key assets (Indofood and Philippine Long Distance Telephony) delivering record high revenue and earnings. Indofood’s guidance for H2 is positive, with a significant increase in margins as higher raw material costs are passed through. While leverage increased slightly due to lower share prices of investee companies, we believe it is still at an acceptable level due to the general market volatility. Liquidity at the holdco is adequate, given the good debt maturity profile. The financial risk profile remains stable, with no real improvement as excess cash flows are mainly returned to shareholders. That said, if the situation deteriorates, such distributions can be delayed/postponed to repair the balance sheet.