In today’s briefing:
- Ohayo Japan | Equities Bounce Despite Failed Trump-Zelensky Negotiations
- “Buy the Worst” HSI Strategy: Initial Win Against HSI This Year
- Why Going Global Is Crucial for China’s Petrochemical Producers
- Japan Morning Connection: Japan Set to Rebound Led by Tech and Defence
- Cards Flip: Ola’s Market Share Falls; India Electric Two-Wheeler Sales Trend – February 2025
- [Blue Lotus Non-US Internet Weekly, 9/52]: DeepSeek (DS) New Research Paper Showed 85% Profit Margin
- China Property Developers In Distress – Weekly News & Announcements Tracker | Feb 21- 27, 2025
- [Blue Lotus China New Consumer Weekly, 9/52] New Home Sales Also Turned Positive YoY
- CHMP Meeting Update: 4 New Medicines Recommended For Approval, Reinstates Previous Leqembi Decision
Ohayo Japan | Equities Bounce Despite Failed Trump-Zelensky Negotiations
- U.S. stocks bounced back after brief declines triggered by failed Trump-Zelensky negotiations. The S&P closed up 1.6%
- Aeon will acquire the remaining shares of its listed subsidiaries Aeon Mall and Aeon Delight, addressing investor concerns about parent-subsidiary listings
- Recruit Holdings will buy back up to ¥450bn of its shares; Daiichi Sankyo will buy back up to ¥50bn of its shares, or 0.9% of total issued shares
“Buy the Worst” HSI Strategy: Initial Win Against HSI This Year
- Our “Buy the Worst” strategy has outperformed the HSI by 1.7pp in the first two months. Meanwhile, the basket of best-performing constituents have underperformed 1.9pp.
- More news on stimulating consumptions should be positive to Budweiser Brewing APAC (1876 HK), Chow Tai Fook Jewellery (1929 HK), and even Hang Lung Properties (101 HK).
- Trip.com Group (9961 HK) has been weighed down by weaker profitability on higher costs. Earnings risks may negatively affect Meituan (3690 HK) and China Hongqiao (1378 HK).
Why Going Global Is Crucial for China’s Petrochemical Producers
- China’s petrochemical companies should speed up their overseas expansions, with a focus on building up capacity to withstand fierce domestic competition and rising trade barriers, an industry group leader said.
- “Internationalization has become a strategic choice for China’s petrochemical industry as it confronts global trade tensions and supply chain restructuring,” Fu Xiangsheng, vice chairman of the China Petroleum and Chemical Industry Federation, said at a press conference last week.
- Fu explained that escalating geopolitical tensions, coupled with major powers’ efforts to “decouple” from China are threatening global supply chain security.
Japan Morning Connection: Japan Set to Rebound Led by Tech and Defence
- US broke the Tech rout on Friday while the Trump/Zelensky spat points to higher EU defense spending.
- ON Semi is reported to be making a play for Allegro signalling a potential liquidity event for Sanken.
- JP SPE was heavily sold on Fri so expect a sharp rebound to start.
Cards Flip: Ola’s Market Share Falls; India Electric Two-Wheeler Sales Trend – February 2025
- India’s E-2W market witnessed a major shakeup in Feb-2025.Ola Electric (OLAELEC IN)‘s sales nosedived,causing the company to fall from the No. 1 position in January to No. 4 in February.
- Bajaj Auto Ltd (BJAUT IN) led the market with 21,335 units, followed by TVS Motor (TVSL IN) at 18,743 units and Ather Energy (1207922D IN) at 11,788 units.
- Market continues to be highly competitive,with top three players vying for leadership. Increasing consumer adoption,new product launches, and potential IPOs from key companies indicate dynamic year ahead for E-2W industry.
[Blue Lotus Non-US Internet Weekly, 9/52]: DeepSeek (DS) New Research Paper Showed 85% Profit Margin
- DeepSeek’s (DS) own traffic declined as rivals launching white-label DS service but DS published research paper showing unmatched profit margin of 85%;
- JD’s take out initiative update: We think JD is serious but its effort will be in vain. We think JD.com knows it too.
- Shopee and Lazada colluded to raise commission in SE Asia, benefiting both with no loss of market share.
China Property Developers In Distress – Weekly News & Announcements Tracker | Feb 21- 27, 2025
- This note is a weekly (select weeks on SK) curated selection of Chinese news articles and company announcements focused on developers in distress
- We look for their deals, updates, specific project progress news (‘local signals’), as well as relevant local research commentaries about the market
- We do not verify the underlying data or provide any opinion, we only select and summarize the information; See direct links to the sources
[Blue Lotus China New Consumer Weekly, 9/52] New Home Sales Also Turned Positive YoY
- Following existing home last week, new home sales also posted positive YoY growth.
- LI is getting ready for its major battle of the year with BEV launch. It is focused, but we doubt it is enough;
- MNSO guided down its C4Q24 and we believe it will miss 2025 as well. Offline grocery is under constant assault by O2O and online e-commerce.
CHMP Meeting Update: 4 New Medicines Recommended For Approval, Reinstates Previous Leqembi Decision
- EMA’s human medicines committee (CHMP) recommended three new medicines for approval and adopted positive opinion for one generic medicine at its February 2025 meeting.
- The committee recommended extending the therapeutic indications of 16 existing medicines, including two cystic fibrosis medicines, KAFTRIO and KALYDECO and oncology drugs CALQUENCE, DARZALEX, ENHERTU, and RINVOQ .
- The CHMP concluded that its opinion recommending a marketing authorization for Eisai’s Alzheimer’s disease drug Leqembi does not need to be updated.
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