In today’s briefing:
- Great Wall Motor (2333 HK) – RMB Dual Counter Trading Starts Today, Watch that A-Share Discount
- Merger Arb Mondays (19 Jun) – Golden Eagle, Hailan, Yitai Coal, Toshiba, Kenedix, Tesserent, Oishi
- BeiGene (6160.HK/BGNE.US) – AbbVie‘s Patent Infringement Allegations Are Not as Simple as Imagined
Great Wall Motor (2333 HK) – RMB Dual Counter Trading Starts Today, Watch that A-Share Discount
- 24 different HK-listed stocks will be tradable in RMB on the HKEX starting 19 June. They make up 35% of HKEX market cap, 40% of total turnover. They are fungible.
- The ultimate goal is to allow mainland investors to trade HK stocks in RMB, but we’re not there yet. Southbound has yet to be approved for the 21 SB-eligible names.
- Only five of the 24 have A-shares, and of those, three (China Mobile, CNOOC, and Great Wall Motor) have wide H-share discounts. Those should be the ones to look at.
Merger Arb Mondays (19 Jun) – Golden Eagle, Hailan, Yitai Coal, Toshiba, Kenedix, Tesserent, Oishi
- We summarise the latest spreads and newsflow of merger arb situations covered by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Philippines, Thailand and Chinese ADRs.
- Highest spreads – 111 Inc (YI US), United Malt Group Ltd (UMG AU), Silk Laser Australia (SLA AU), Estia Health (EHE AU), Chindata Group (CD US), ENM Holdings (128 HK).
- Lowest spreads – Healius (HLS AU), Liontown Resources (LTR AU), Musgrave Minerals (MGV AU), Toyo Construction (1890 JP), Lian Beng (LBG SP), Penguin International (PBS SP).
BeiGene (6160.HK/BGNE.US) – AbbVie‘s Patent Infringement Allegations Are Not as Simple as Imagined
- AbbVie’s patent infringement allegations against BeiGene Ltd (6160 HK) is an attempt to obstruct BeiGene through legal means and save Imbruvica’s sales decline in the market. AbbVie came prepared this time.
- BeiGene has a chance to win the lawsuit if without any political factors.But if BeiGene fails to walk away unscathed, any damages/patent royalty would be detrimental to its financial performance/forecast.
- The real key point in determining BeiGene’s future turnaround is not this lawsuit, but the clinical results of TIGIT project. Even with the correction since May, BeiGene is still expensive.
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