In today’s briefing:
- ECM Weekly (4th Dec 2022) – Skymark, Daiei, Sunshine, Lygend, Weilong, NRI, Zomato, Goto, Bobcat
- EQD | Volatility Update: Weekly Review of Vol Changes and Best Trades
- EQD | Tencent (700 HK): We Identify Three Derivative Trades into Year-End
- Hong Kong CEO & Director Dealings (2 Dec): Perfect Medical, Hong Kong Aerospace, ESR Group, Tian An
- China Healthcare Weekly (Dec.2)- VBP Correction, Sales Ability Overweigh R&D, Expectation Difference
- High Conviction Idea: Yili
ECM Weekly (4th Dec 2022) – Skymark, Daiei, Sunshine, Lygend, Weilong, NRI, Zomato, Goto, Bobcat
- Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
- On the IPO front, the two Japanese IPO set the ball rolling for the year end rush, with a few more lined up in Hong Kong along with Sunshine.
- There were a few largish selldowns in Japan and India and given Hong Kong’s recent performace, it will see some deals soon as well.
EQD | Volatility Update: Weekly Review of Vol Changes and Best Trades
- Weekly summary of vol changes and moves across Global Markets
- Analysing ATM volatility and skew changes over the last 5 days
- We suggest a few trades to take advantage of the implied vol surfaces
EQD | Tencent (700 HK): We Identify Three Derivative Trades into Year-End
- Stock has recovered from an October low but may be running out of steam
- Realised vol has been high and implied vols have not fallen as much as other equity assets
- We suggest three trade ideas into year-end to take advantage of the vol surface and spot level
Hong Kong CEO & Director Dealings (2 Dec): Perfect Medical, Hong Kong Aerospace, ESR Group, Tian An
- The data in this insight is collated from the “shareholding disclosure” link on the HKEx website.
- Often there is a corresponding HKEx announcement on the increase – or decrease – in the shareholding by directors. However, such disclosures are by no means an absolute.
- These insights may flag those companies where shares have been pledged. Stocks mentioned include: Perfect Medical Health (1830 HK), Hong Kong Aerospace Technology (1725 HK), and ESR Group (1821 HK).
China Healthcare Weekly (Dec.2)- VBP Correction, Sales Ability Overweigh R&D, Expectation Difference
- The renewal results of coronary stent centralized procurement reflected that the government’s attitude towards the price reduction in VBP has changed, who tend to correct the excessively low price.
- Investors’d better not to have such a misconception that they only attach importance to R&D rather than commercialization. Only if sales ability is verified can enterprises have better valuation premium.
- Investors are advised to find the targets that are in “sector resonance” but also has “difference in expectations”. Ecology of innovative drug has changed, such as Remegen (688331 CH).
High Conviction Idea: Yili
- Yili is the largest dairy company in China with established entry barriers of brand and products.
- Yili aims to join the world’s top three dairy enterprises by 2025 and strives to seize first place by 2030.
- Management announced the plan of a revenue CAGR of ~10% y/y between 2021 and 2025 and margin improvement of 50bps each year.
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