In today’s briefing:
- SF Holding H Share Listing: AH Discount Views
- Xingda (1899 HK): A Surprising Result as Offer Declared Unconditional
- Merger Arb Mondays (18 Nov) – Henlius, GAPack, Xingda, Seven & I, Fuji Soft, NEC Networks, Macromill
- Ping An Healthcare and Technology (1833 HK) – Privatization Ahead?
- Xingda (1899 HK): Go Figure As Offer Turns Unconditional
- Pony AI IPO – Autonomous Valuation
- Oriental Watch (398 HK) H1 FY25 and Mgmt Meeting: Resilient 14% Yield Despite Tough Environment
- CiDi IPO Preview: Uniquely Positioned For Growth In Autonomous Mining and Logistics Trucks
SF Holding H Share Listing: AH Discount Views
- S.F. Holding (002352 CH), the largest Asian integrated logistics service provider, is premarketing an H Share listing to raise US$1.0-1.5 billion, according to press reports.
- In SF Holding H Share Listing: Updates Point to Improving Fundamentals, we noted that SF is in good health, with a return to growth, rising margins, and strong cash generation.
- In this note, we examine the likely discount SF Holding will offer its H Shares compared to the A Shares.
Xingda (1899 HK): A Surprising Result as Offer Declared Unconditional
- On its first closing date on 15 November, Xingda International (1899 HK) declared the Chairman’s offer unconditional as the offeror and concert parties represented 60.76% of outstanding shares.
- The result was surprising. The IFA opined that the offer was not fair or reasonable, and the independent Board recommended that the shareholder not accept it.
- The CCASS movements suggest that the offer was declared unconditional mainly because friends and family supported the Chairman’s offer. The gross/annualised spread is 1.6%/92.6%.
Merger Arb Mondays (18 Nov) – Henlius, GAPack, Xingda, Seven & I, Fuji Soft, NEC Networks, Macromill
- We summarise the latest spreads and newsflow of merger arb situations we cover across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Philippines, Thailand and Chinese ADRs.
- Highest spreads: Renewable Japan (9522 JP), Shanghai Henlius Biotech (2696 HK), Macromill, Inc (3978 JP), Seven & I Holdings (3382 JP), Canvest Environmental Protection Group (1381 HK).
- Lowest spreads: Nec Networks & System Integr (1973 JP), Net One Systems (7518 JP), Avarga Ltd (AVARGA SP), T Gaia Corp (3738 JP), Nishimoto (9260 JP), Elematec Corp (2715 JP).
Ping An Healthcare and Technology (1833 HK) – Privatization Ahead?
- PAGD’s business model is problematic, leading to continuous shrinking revenue scale. As PAGD will entirely lose competitiveness in the future, the management wants to find a suitable way to “exit”.
- Privatizing PAGD at low price and integrating it into the Ping An Group’s system is a good choice. In other words, Ping An hopes other shareholders to choose cash dividends.
- Due to high tax, Hong Kong Stock Connect investors would prefer to sell in advance. Arbitrageurs can wait until stock price drops then make decisions based on new conversion price.
Xingda (1899 HK): Go Figure As Offer Turns Unconditional
- Back on the 24 September, tyre component manufacturer Xingda International (1899 HK) announced a zero-premium $1.30/share cash Offer from Liu Jinlan, chairman and executive director.
- Liu and concert parties held 37.03%, and the Offer was conditional on a 50% acceptance hurdle. The IFA concluded the Offer was not fair.
- Surprisingly, 23.73% of shares out have tendered, and the Offer is now unconditional in all respects. The Offer will remain open to acceptances until the 29th November.
Pony AI IPO – Autonomous Valuation
- Pony AI (PONY US), an autonomous mobility solutions provider, is looking to raise up to US$195m 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.
- We have looked at the company’s past performance in our previous notes. In this note, we will talk about the IPO valuations.
Oriental Watch (398 HK) H1 FY25 and Mgmt Meeting: Resilient 14% Yield Despite Tough Environment
- Oriental Watch reported H1 FY25 revenues/profits down 2.6%/-13.7 % YoY despite the tough retail sales environment, especially in HK (25% of revenues).
- The company declared a 24.6 HKD cents dividend, equivalent to a 14% dividend yield annualized on the current price.
- With 62% of the market capitalization in cash, a 7x PE, and a 14% dividend yield (assuming a consistent 100% payout), this is a name to look at.
CiDi IPO Preview: Uniquely Positioned For Growth In Autonomous Mining and Logistics Trucks
- CiDi, a China’s leading provider of AD technology for commercial vehicles, will tap equity markets in Hong Kong for growth capital.
- The autonomous driving company with focus on autonomous mining and logistics trucks, V2X technologies, and high-performance perception solutions, filed its IPO prospectus.
- I like CiDi’s leadership position in autonomous mining industry, hyper-growth trajectory and differentiated full-stack autonomous mining solution.
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