Overseas Chinese Equities, Aequitas Research

Ming Lu

A veteran with 19-year experience in equity research.

Geographical coverage:
* Companies operating in China, but listed in Hong Kong and the U.S.
* Previously China A-share (listed in mainland China).

Equity sector coverage:
* Chinese App / Internet-based consumption in China, e.g., Alibaba, Tencent, etc.
* Previously covered education, transportation, telecom, power, bank, advertisement, hotel, etc.

Research methods:
* Generally bottom-up.
* Talk to related people on the ground.  Talk to readers and independent writers for analyzing a news portal.  Talk to parents and teachers for analyzing a tutoring school. 
* Visit stores and show photos as evidence in notes.
* Do technical analysis when finding a short-seller attacking an equity.

Languages:
* English
* Mandarin Chinese (Official language of China)
* Shanghainese (Language of Shanghai, the most developed city in China)
* Cantonese (Language of Hong Kong and Canton Province, one of the most developed provinces in China)

Overseas Chinese Equities

Tencent Music (TME): 3Q21, Entertainment Revenue Decreased for First Time

Tencent Music (TME): 4Q21, Revenue Down for First Time

Tencent Music (TME): Upgrade to Buy for First Time After Plunge

Tencent Music (TME): 1Q21, New CEO Cares Financial Data, But Not Operating Data, Buy

Tencent Music (TME): Penalty Not Fatal, But Music Market Bad Enough

Battle Lines Drawn As BABA Builds Out First/Last-Mile Capacity; But Who Will Fund 75+ Bn CNY CapEx?

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Bottom-Up

<ul>
<li>The real main business, social entertainment, grew by only 7.4% YoY.</li>
<li>The paying user base continued shrinking.</li>
<li>Compared to Kuaishou, we believe the stock has a downside of 22%.</li>
<li>About the minor business, music, please see <a href="https://www.smartkarma.com/insights/tencent-music-tme-penalty-not-fatal-but-music-market-bad-enough" target="_blank" data-smartkarma-citation="insights:55447" rel="noopener">Tencent Music (TME): Penalty Not Fatal, But Music Market Bad Enough</a>.</li>
</ul>


The real main business, social entertainment, grew by only 7.4% YoY.
The paying user base continued shrinking.
Compared to Kuaishou, we believe the stock has a downside of 22%.
About the minor business, music, please see Tencent Music (TME): Penalty Not Fatal, But Music Market Bad Enough.


Tencent Music (TME): 2Q21, Slow Main Business