In today’s briefing:
- HKBN (1310 HK): Another Sing Tao Article as Speculation Swirls on MBK’s Loan Notes Conversion
- Fengxiang (9977 HK): Privatisation by PAG?
- Canvest (1381 HK): Precondition Satisfied
- Quiddity Leaderboard HSTECH Jun25: US$204mn One-Way; No Index Changes Likely
- Quiddity Leaderboard HSIII Jun25/Sep25: Capping Flows in June and Index Changes in September
- Ping An Insurance (2318 HK): 2024 Earnings, Divergence Between Option-Implied And Historic Move
- Quiddity Leaderboard HSCEI Jun25: Large Price Swings Needed to Trigger Index Changes
- Hong Kong Single Stock Options Weekly (March 10 – 14): Sentiment Shifts, Option Volumes Cool
- WuXi AppTec (2359 HK): In-Line 2024 Performance; Announces Dividend and A Share Buyback Plan
- IRGMA Raises Alarm Over Dumping Of Inferior Gloves Into India
HKBN (1310 HK): Another Sing Tao Article as Speculation Swirls on MBK’s Loan Notes Conversion
- A new Sing Tao Daily article on HKBN Ltd (1310 HK) claims that China Mobile (941 HK)’s offer is a stalemate, and a potential I Squared offer faces regulatory challenges.
- The article is being unduly alarmist. The concerns raised on the China Mobile offer remain premature, and there remains a medium-to-high probability of a competing offer from I Squared.
- Last Friday, MBK converted its vendor loan notes (VLN) into shares, which could signal that an I Squared competing offer is imminent.
Fengxiang (9977 HK): Privatisation by PAG?
- Shandong Fengxiang (9977 HK) entered a trading halt “pending the release of an announcement pursuant to the Code on Takeovers and Mergers.” PAG, the controlling shareholder, likely aims to privatise Fengxiang.
- The offer will likely be structured as a privatisation by merger by absorption requiring approval by at least 75% of independent H Shareholders (<10% of all independent H Shareholders rejection).
- The presence of several substantial shareholders necessitates a reasonable offer. An offer of HK$1.80-2.00 (a 21%—33% premium to the last close) could win over these shareholders’ backing.
Canvest (1381 HK): Precondition Satisfied
- Grandblue Environment Co A (600323 CH) has satisfied the precondition related to its privatisation offer for Canvest Environmental Protection Group (1381 HK).
- The offer remains attractive despite the re-rating of peers since announcing the deal. The vote risk is low as the two shareholders holding blocking stakes will be supportive.
- This is a done deal. At the last close, the gross/annualised spread for a mid-June payment is 3.8%/13.0%.
Quiddity Leaderboard HSTECH Jun25: US$204mn One-Way; No Index Changes Likely
- The HSTECH Index tracks the performance of the top 30 technology companies listed in Hong Kong that have high business exposure to certain technology themes.
- In this insight, we take a look at the rankings of potential ADDs and potential DELs for the June 2025 index rebal event.
- We see zero index changes based on the latest available data but we estimate there to be US$204mn one-way flows due to capping.
Quiddity Leaderboard HSIII Jun25/Sep25: Capping Flows in June and Index Changes in September
- The Hang Seng Internet & IT (HSIII) index represents the top 30 stocks related to internet and information technology businesses listed in Hong Kong (HKEX).
- In this insight, we take a look at our capping flow expectations for the June 2025 index rebal event.
- We have also presented our index change expectations for the next semiannual index review which will take place in September 2025 (regular ADDs/DELs only take place in March and September).
Ping An Insurance (2318 HK): 2024 Earnings, Divergence Between Option-Implied And Historic Move
- Ping An Insurance (2318 HK / 601318 CH) is set to announce Annual 2024 Results on 19 March 2025.
- Option markets are currently pricing in a significantly larger post-announcement price move than historical patterns would suggest.
- Two trade examples for calendar spreads, taking advantage of elevated near-term implied volatility, are presented.
Quiddity Leaderboard HSCEI Jun25: Large Price Swings Needed to Trigger Index Changes
- The HSCEI serves as a benchmark to reflect the overall performance of the top 50 “Mainland China” securities listed in Hong Kong.
- In this insight, we take a look at the rankings of potential ADDs and potential DELs for the June 2025 index rebal event.
- We see no index changes based on the latest available data. However, there will be some flows in June 2025 due to capping.
Hong Kong Single Stock Options Weekly (March 10 – 14): Sentiment Shifts, Option Volumes Cool
- Market sentiment shifted again this week, with participation in stock gains dropping sharply from last week’s levels.
- Option volumes continued to decline from February peaks, though single stocks saw a notable increase in activity on Friday.
- We cover stocks with liquid options that have earnings reports in the coming week.
WuXi AppTec (2359 HK): In-Line 2024 Performance; Announces Dividend and A Share Buyback Plan
- WuXi AppTec (2359 HK) has reported 2024 result, with revenue reaching RMB39.2M, in-line with guidance of RMB38.3–40.5B. Excluding Covid-19 commercial project, 2024 revenue represents 5% YoY growth.
- The company has announced a cash dividend of RMB9.8 and a special dividend of RMB3.5 for every 10 shares. Wuxi AppTech has also proposed RMB 1B buyback plan (for A-shares).
- Based on the current backlog, Wuxi AppTech expects continuing operations revenue to resume double-digit growth of 10–15% YoY in 2025, targeting to deliver a total revenue of RMB41.5–43.0B.
IRGMA Raises Alarm Over Dumping Of Inferior Gloves Into India
- Dumping of gloves from Malaysia, Thailand, Vietnam into India alleged
- IRGMA petitions Indian Government for intervention to stop
- DGTR recommends ADD on imports of titanium dioxide from China
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