Daily Brief China: Pony AI, Horizon Robotics, Shui On Land, SITC International, Beijing Biostar Pharmaceuticals Co Ltd, Longfor Properties and more

• Pony AI (PONY US)  an autonomous mobility solutions provider, is looking to raise up to US$300m in its US IPO. 
• As per Frost & Sullivan, Pony AI was among the first companies in China to obtain licenses to operate fully driverless robotaxis in all four Tier-1 cities in China.
• In this note, we talk about the positive aspects of the deal.

• Horizon Robotics (9660 HK) raised around US$800m, including over-allocation, in its Hong Kong IPO. 
• Horizon Robotics (HR) is a provider of advanced driver assistance systems (ADAS) and autonomous driving (AD) solutions for passenger vehicles, empowered by its proprietary software and hardware technologies.
• We have looked at the company’s past performance and valuations in our previous notes. In this note, we will talk about the trading updates.

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
We assess Shui On Land’s ESG as “Adequate”, in line with its Environmental, Social and Governance scores. Controversies are “Immaterial” and Disclosure is “Strong”.

• Together with the just-announced HK$0.40 special DPS, SITC International (1308 HK) has already handed back HK$1.12/share to shareholders YTD, realising a dividend yield of 6.5%.
• Its 3Q24 performance is impressive, with revenue surging 56.6% YoY. Both volume (+13.4%) and average freight rates (+44.1%) have exhibited solid momentum. 
• While the consensus forecasts have been upgraded by 7-11% since the 1H24 result, there appears more room to go. FY24 ROE is now expected to be 32.2%.

• Pony AI, a founder-led global autonomous driving company, filed for an IPO in the United States and may raise up to $300M on the Nasdaq exchange.  
• The technology company operates fully driverless robotaxis (L4) in Beijing, Shanghai, Guangzhou and Shenzhen, Mainland China.
• Pony AI has raised ~$1.4B in equity financing from top-tier investors, including Toyota Motor, HongShan, IDG Capital, 5Y Capital, ClearVue Partners, and Eight Roads Ventures, among others.

• Biostar’s revenue growth decreased obviously in the first five months in 2024. Under the fierce competition and anti-corruption campaign, the expectation for the commercialization performance of Biostar is not high.
• Although Biostar has invested a lot of resources in market exposure, high customer concentration indicates that the Company faces challenges in marketing/customer relationship expansion. Biostar has also encountered overcapacity issues.
• After Series E Financing, Biostar’s post-investment valuation was RMB4.49 billion. But we’re not optimistic about the outlook of Biostar. This valuation could be difficult to achieve in HK stock market.

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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