Daily Brief China: Irc Ltd, WuXi XDC Cayman , Li Auto , Chenqi Technology Limited, MGM China Holdings and more

• Irc Ltd (1029 HK) has announced a mandatory conditional offer from Nikolai Levitskii (Chairman) at HK$0.118 per share, a 32.6% premium to the undisturbed price (1 November). 
• The offer is conditional on the offeror and concert parties representing more than 50% of voting rights.  The offeror currently represents 30.61% of outstanding shares.
• The offer looks light vs long-term trading ranges. The minimum acceptance threshold implies a minority acceptance rate of 27.9% (36.8% if MIC Invest does not tender), which is not onerous.

• Wuxi plans to issue 178.4m shares at an indicative IPO price range of HK$19.9-20.6 per share and will raise net proceeds of US$479m at the midpoint of the IPO price.
• The company’s revenues have seen robust growth during the last 3-years driven by growth in ADC outsourcing market while margins have continued to decline.
• We have valued WuXi XDC Cayman (1877628D HK) using a DCF valuation which offers price per share of HK$23.44, 15.7% higher than the midpoint of the IPO price of HK$20.25.

• Two days before Huawei and Chery releasing their Luxeed S7 sedan to rival Model 3, LI unveiled the technical details of its MPV entry MEGA; 
• We see MEGA taking a meaningful market share from BYD’s Denza D9, GM’s GL8, GAC’s Trumpchi M8, all selling ~10K a month. We raise MEGA’s 2024 shipment to 57K;
• We raise LI’s TP from US$40 to US$47 and maintain BUY.

• Nikolai Levitskii, Russian iron-ore play IRC Ltd (1029 HK)‘s chairman and largest shareholder, has acquired 4.72% of shares out, lifting his stake above 30%, triggering an MGO. 
• The Offer price of HK$0.118/share, a 32.58% to last close, is the same price paid for the stake increase. 
• The Offer is conditional on Levitskii holding more than 50% of shares out. His intention is to maintain IRC’s listing. 

• Chenqi Technology Limited (CT HK) is looking to raise US$300m in its upcoming Hong Kong IPO. 
• Chenqi Technology (Chenqi) is a mobility technology and service company in China, founded by the GAC Group and Tencent. 
• Chenqi has grown its GTV fast on the back of network expansion. However, Dida’s inability to list and Chinese regulators’ scrutiny on Didi would likely dent sentiment surrounding Chenqi. 

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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