Emerging Market Links + The Week Ahead (April 10, 2023)
India, Turkey & Brazil trip reports. Tencent's golden share problem, Mexico's auto parts industry in the EV age, Robeco discusses investment strategy for Asia and the week ahead for emerging markets.
A couple of good trip report style pieces covering India, Turkey and Brazil have recently been published along with a piece about Tencent’s golden share problem that may expose it to more intervention (golden shares are a way for the Chinese government to exert more control over the country’s internet firms).
There are two good podcasts to listen to albeit the one covering China with the Navis Jockey Fund was long winded. I have summarized some key points about some specific stocks - including a little known small cap providing AI driven credit solutions to Chinese banks.
In the second podcast, the Robeco's head of fixed income and their head of equities for Asia discuss their investment approach for the region. This podcast has a full transcript and is worth listening to.
Finally, you may not have heard, but Elon Musk declared war on Substack over Substack Notes - which apparently is NOT even ready for most writers-readers yet. Why Substack announced Notes without having it ready for everyone to use is a mystery to me! Now we CANNOT embed most Tweets into Substack posts nor share Substack links on Twitter - definitely harming writers who don’t also have at-least a basic website up like I do (http://www.emergingmarketskeptic.com/) where they can cross post. Feel free to share this Substack if you find it useful:
TO BE HONEST: I have always found Twitter to be next to useless for generating content traffic - unless you have paid for followers and know all the tricks to gaming the algorithm. HOWEVER, if and when Substack makes Notes available, it could be a very useful tool to put out short content with a chart on individual emerging market stocks and ideas WITHOUT flooding email boxes (as NOBODY wants their email boxes flooded at random times…) and being drowned out by all the other Twitter noise.
I have finally tried Substack’s existing short Thread feature, see: South African Dividend Stock List Infographic. But there is no way to just have a Thread appear on the App and Substack Feed, but NOT flood email inboxes. I will find a way to make more use of the Thread feature (without flooding email boxes).
Suggested Reading
$ = behind a paywall
Five takes on multi-asset investing in post-pandemic China (Schroders)
India – Insight trip (March 2023) (Alquity) PDF File
NOTE: Nicely formatted report. Lemon Tree Hotels (NSE: LEMONTREE / BOM: 541233) (India's largest chain in the mid-priced hotels sector and third largest overall) is also discussed.
Our Senior Investment Analyst, Daniel Billis, has recently returned from India where he met with approximately 40 companies in Mumbai, Chennai, and Delhi. His aim was to gain insight into the post-Covid economy and assess its current state.
On the ground in Brazil (East Capital)
NOTE: From February. No specific stocks mentioned.
We spent the last few days in São Paulo where we met over 20 companies across a diverse range of sectors from blade manufacturers for wind turbines to fintechs to emergency response specialists. We have five key takeaways which will drive our portfolio allocation decisions in Brazil going forward.
1. Brazil is a truly unique country blessed with abundant natural resources (fertile land, rain, sun, wind, metals and fossil fuels), a smart and educated workforce and an enormous range of listed companies.
2. Local investor sentiment is staggeringly poor.
3. Agri stocks in focus.
4. Fintechs undressed.
5. Caveat emptor. (Lojas Americanas accounting scandals)
Mexico’s $100-billion auto parts industry is reinventing itself for the EV era (Rest of World)
Mexico is the world’s fourth-largest exporter of auto parts. Thousands of parts manufacturers have emerged in the country to support the massive auto conglomerates that build their cars there — companies like GM, Ford, Kia, Audi, and Hyundai. In 2022, Mexico’s auto parts manufacturing was valued at $106.7 billion; for comparison, Mexico’s completed vehicle exports were estimated at $165 billion in the same year. Auto parts manufacturing employs roughly one million people, with over 12% being directly involved in the production of combustion engines — the jobs most likely to be immediately affected by the EV transition.
Gaining expertise in parts manufacturing for electrical motors will be a challenge, according to German Carmona Paredes, who teaches mechanics and energy at the Engineering School in Mexico’s National Autonomous University (UNAM). He is worried that the local industry will struggle to adapt to the high tech required by EVs. “The biggest challenge for Mexico has to do with batteries, electronics, and electrical motors,” he told Rest of World, noting a large percentage of these components are chiefly made in China and are exported to Mexico just for assembly.
Don't navigate on headline news when investing in Asia-Pacific (Robeco) 26:40 Min Podcast w/ Transcript
Robeco’s Thu Ha Chow, Head of Fixed Income Asia, and Joshua Crabb, Head of Asia-Pacific Equities, discuss their approach to the region. Key takeaways:
But even if you think that supply chains are going to get broken, et cetera, that is going to be a boom. If there's less in China, there's going to be more in Indonesia, there's going to be more in Vietnam.
…we've had a lot of risk within SVB in the US and then Credit Suisse here in Europe, is just a reminder, actually, there is risk in all markets. And as Josh mentioned, the risk within Asia is actually much more honed in, and we talk a lot more about those and we should have been talking about these other risks elsewhere. So I think that's a positive, that the risks are well flagged and people know what they are navigating them.
If you go and start a factory in China today, you basically build a factory, try and get some staff from your nearest competitor at a higher price and you operate. When you go and build one in Indonesia or Vietnam, you're literally going into probably an urban area that needs to be cleared, roads need to be built, a power station needs to be built, housing needs to be put in. Then you go and hire someone who's probably been working in the informal economy. They get a job with a regular paycheck. They can then take that to the bank, They can borrow money. So the multiplier effects in these economies are very, very dramatic. Keep in mind, 1 in 2 people in Indonesia do not have a bank account.
…when we consider the nature or the uncertainty around things like geopolitics, I think that’s [index investing approach] a risky way of doing things, because what's large now may not be as large in the future. I was looking at one of the countries in the region literally just then and looking at who the richest top ten were and how much that has changed over the last 20 years, and the industries they're involved in. So I do think that is quite dangerous.
And that volatility provides good opportunities for entering into that. And you have to be bottom up. You have to kind of do the homework. It's just not a one size fits all.
… this is a profit opportunity because the last time we saw valuations this low and the last time we saw a valuation gap this large, when things did bottom up and start to improve, Asia outperformed by over 100%. So you have to think things are a lot different this time around or want to give up on those sort of opportunities. So, as rate hikes come to an end, as stimulus comes through, there's still a lot of lot of the production around the world, a lot of that stimulus money will find its way here at very, very cheap valuations. Don't get too tied up around geopolitics. These things tend, as we all hope, not to get as bad as what people think. But even if they do stay in this sort of stalemate situation, there is the 681 million people in Asia, and I told you about this, the world's largest population in India. That's all part of Asia as well. Don't miss out on this opportunity. And geopolitics can improve. It is possible.
Emerging Market Stock Picks / Stock Research
$ = behind a paywall
Why Tencent’s Golden Share Arrangements Could Be Worse for Investors Than Alibaba’s (China Tech Shorts)
NOTE: There is Tencent (HKG: 0700 / LON: 0LEA / FRA: NNND / OTCMKTS: TCEHY) the holding company and Tencent Music Entertainment Group (NYSE: TME).
While Alibaba Group (NYSE: BABA)'s golden share arrangement was relatively limited, the same is unlikely to be true for Tencent. The company's corporate structure is likely to expose it to a more meaningful intervention.
Is China Still Uninvestable? A conversation with Navis Jockey Fund (SumZero) 52 Minutes
Note: Navis Jockey Fund. This is an update to his interview from 8 months ago (Is China Uninvestable?) and it’s a bit long winded - a reason I don’t like podcasts. Here are some highlights about specific stocks mentioned:
China had to reopen because local governments were running out of money.
Biggest China risk: Xi may still prioritize ideology over pragmatism.
Macrowise, China has decoupled from the US. Low inflation / low rates.
10:30 or so mark - Digs into stocks. Many are cash cows now. Alibaba Group’s (NYSE: BABA) can double or triple pretty quickly. 17:40 - aggressive accounting and lack of disclosures.
JD.com (NASDAQ: JD) sparking a price war in eCommerce by offering subsidies (JD had an advantage with logistics during lockdowns).
19:50 - Baidu (NASDAQ: BIDU) AI leader in China but AI requires high-end semiconductors the US has restrictions on. Online advertising was killed by COVID but should recover.
25:40 - After school tutoring stocks lost 95%. New Oriental Education (NYSE: EDU) very transparent e.g. said they would loose 50% of their business, etc. Now up 4Xs. A live streaming business with former tutors promoting ag-grocery products in English-Chinese has turned into a strong business.
36:00 - Invest in positive cashfow - then investors just need patience.
37:30 - He likes small cap Bairong Inc (HKG: 6608 / FRA: 6B5) - provides AI / digital intelligence to banks for credit purposes. 3X EBITDA. Growth business. Has western VCs.
47:40 big misperceptions on China: 1) Centrally planned economy. 2) CCP narratives and taking it serious e.g. it’s like political correctness.
Turkey – Taking Stock in Times of Change (Undervalued Shares)
Good overview about Turkey, but I had to add all the links below…:
Surprisingly, it's also one of the most liquid emerging markets there is.
Turkish Airlines is the world's most actively traded emerging market stock.
Plus, the Turkish market made impressive gains in 2022 – up 110% in dollar terms!
Turkey has major elections coming up in May 2023, which could be a game changer for the market.Not many investors would know which Turkish companies to buy stock in, other than Turkish Airlines, which nowadays trades under its Turkish name, Türk Hava Yolları (ISIN TRATHYAO91M5 and US90010R1095, IST: THYAO).
One stock that I regularly spot in portfolios of emerging market fund managers is Şişecam Group (ISIN TRASISEW91Q3, IST: SISE), the world's third largest producer of glassware. The company is heavy on exports, which is why it counts as one of the biggest beneficiaries of the devaluing lira.
Koç Holding (ISIN TRAKCHOL91Q8, IST: KCHOL), Turkey's largest industrial and services group that single-handedly controls 6.4% of Turkish GDP. It commands 20% of the market cap of the Istanbul stock exchange.
Anadolu Efes (ISIN TRAAEFES91A9, IST: AEFES), Europe's fifth largest brewer and among the world's tenth largest brewers by production volume.
Arçelik (ISIN TRAARCLK91H5, IST: ARCLK), the leading household appliances producer in Turkey with a domestic market share of >50%, and the third largest white goods player in Europe.
BİM (ISIN TREBIMM00018, IST: BIMAS), the pioneer of discount stores and supermarkets in Turkey.
Coca-Cola İçecek (ISIN TRECOLA00011, IST: CCOLA), the sixth largest Coca Cola bottler in the world (!) in terms of sales volume. The company sells not just in Turkey but also in Pakistan, Kazakhstan, Azerbaijan, Iraq, Jordan, Kyrgyzstan, Syria, Tajikistan and Turkmenistan.
Earnings Calendar
Note: Investing.com has a full calendar for most global stock exchanges BUT you may need an Investing.com account, then hit “Filter,” and select the countries you wish to see company earnings from. Otherwise, purple (below) are upcoming earnings for US listed international stocks (Finviz.com):
Economic Calendar
Click here for the full weekly calendar from Investing.com containing frontier and emerging market economic events or releases (my filter excludes USA, Canada, EU, Australia & NZ).
Election Calendar
Frontier and emerging market highlights (from IFES’s Election Guide calendar):
BulgariaBulgarian National AssemblyApr 2, 2023 (d) Confirmed Oct 2, 2022Paraguay Paraguayan Chamber of Senators Apr 30, 2023 (d) Confirmed Apr 22, 2018
Paraguay Presidency of Paraguay Apr 30, 2023 (d) Confirmed Apr 22, 2018
Paraguay Paraguayan Chamber of Deputies Apr 30, 2023 (d) Confirmed Apr 22, 2018
Thailand Thai House of Representatives May 14, 2023 (t) Confirmed Mar 24, 2019
Turkey Grand National Assembly of Turkey May 14, 2023 (d) Confirmed Jun 24, 2018
Turkey Presidency of Turkey May 14, 2023 (d) Confirmed Jun 24, 2018
Greece Greek Parliament May 21, 2023 (d) Confirmed Jul 7, 2019
Cambodia Cambodian National Assembly Jul 23, 2023 (d) Confirmed Jul 29, 2018
Pakistan Pakistani National Assembly Jul 31, 2023 (t) Date not confirmed Jul 25, 2018
Zimbabwe Presidency of Zimbabwe Jul 31, 2023 (t) Date not confirmed Jul 30, 2018
Zimbabwe Zimbabwean National Assembly Jul 31, 2023 (t) Date not confirmed Jul 30, 2018
Emerging Market IPO Calendar/Pipeline
Frontier and emerging market highlights from IPOScoop.com and Investing.com (NOTE: For the latter, you need to go to Filter and “Select All” countries to see IPOs on non-USA exchanges):
VCI Global Ltd. VCIG, 1.6M Shares, $4.00-6.00, $8.0 mil, 4/6/2023 Postponed
We are a holding company incorporated in the British Virgin Islands on April 29, 2020. We operate and control solely through our subsidiary companies.
We are a multi-disciplinary consulting group with key advisory practices in the areas of business and technology. Each of our segments and practices is staffed with consultants recognized for their wealth of knowledge and established track records of delivering impact. With our core group of experts experienced in corporate finance, capital markets, legal and investor relations, we illuminate our clients’ paths to success by helping them foresee impending challenges and identify business opportunities. We leverage our in-depth expertise to assist clients in creating values by providing profitable business ideas, customizing bold strategic options, offering sector intelligence, and equipping clients with cost-saving solutions for lasting growth.
Since our inception in 2013, we have been delivering our services to companies ranging from small-medium enterprises and government-linked agencies to publicly traded conglomerates across a broad array of industries. Our business operates solely in Malaysia, with clients predominantly from Malaysia, and some engagements with clients from China, Singapore and the United States.
We have segregated our services in the following segments:
Business Strategy Consultancy – We focus on listing solutions, investors relations and boardroom strategies consultancy. We have established a diverse local and international clientele, providing them our services in both local and cross-border listings. Our roles begin from pre-listing diagnosis and planning to the finalization of the entire listing process. To better serve our clients, we extended our services line to include investor relations consultation, where we help our clients effectively handle investors’ expectations and manage communications. Further, we also offer services in attaining effective boardroom strategies for value creation and inclusive growth. Over the years, our consulting services have successfully propelled our clients’ businesses to the next level with strategic options, including mergers and acquisitions, initial public offerings, restructuring and transformation.
Investor Relations Services – In January 2021, our direct subsidiary V Capital Kronos Berhad acquired Imej Jiwa, an investor and public relations consultancy firm, which will allow us to better serve companies seeking to list and trade on public exchanges. Imej Jiwa’s highly-skilled investor relations (“IR”) professionals help companies that are preparing for a successful IPO set up an effective IR team. To date, we are serving more than 40 public-listed Malaysian companies, which represent more than 4% of total Malaysian publicly listed companies. 1 For instance, we have been engaged by Malaysia’s largest home improvement retailer who consummated the biggest IPO in Malaysia since 2017, and the Malaysian leading dairy producer who consummated the second largest IPO in Malaysia since 2017 to provide IR consultancy services. Our IR team builds strategies and communicates effectively to drive stakeholder and media engagement throughout the IPO roadshow and post-IPO process. We are equally committed to sharpen client’s investment narratives and to deliver it to the right investors through the best channel.
Boardroom Strategy Services – We leverage our multiple practices and our connections with professionals across an array of industries to complement clients’ businesses by offering a holistic approach to achieve sustainable growth with high return on capital. Given the exponentially rising expectations from investors, unprecedented economic disruptions, and fragmentation of traditional markets, we believe more companies need carefully planned strategies to stay ahead of the trend and the competition through restructuring or transformation. We help our clients make the right moves by being involved in boardroom discussions and advising them on strategic options, particularly when it comes to exploring opportunities in offshoring, partnering, merger and acquisitions (“M&A”), deals outsourcing and initial public offerings. We have recently been engaged to consult on boardroom strategies for one of the largest hospitality groups in Malaysia as well as company that is a pioneer in human resources technology provider in Malaysia.
Technology Consultancy Services & Solutions – Our technology consultancy services and solutions keep our clients ahead of major technology and industry trends, including next-generation digital transformation, software development, blockchain solutions and the industry restructuring brought upon by the convergence of these technologies.
Note: Revenue and net income figures are in U.S. dollars (converted from the Malaysian Ringgit) for the 12 months that ended June 30, 2022.
(Note: VCI Global added Sutter Securities as a joint book-runner – joining Boustead Securities – in its F-1/A filing dated March 10, 2023. VCI Global cut its IPO almost in half in an F-1/A filing dated March 1, 2023, by reducing the number of shares to 1.6 million – down from 3.0 million shares – and keeping the price range at $4.00 to $6.00 to raise $8.0 million. That cut represents a 47 percent reduction in the amount of IPO proceeds – to $8.0 million, down from $15.0 million under the previous terms. VCI Global filed its F-1 on Nov. 1, 2022.)
Top KingWin Ltd. TCJH, 3.0M Shares, $4.00-5.00, $14.0 mil, 4/10/2023 Week of
Top KingWin offers financial advisory and other services to small and medium-sized enterprises (SMEs) in China. (Incorporated in the Cayman Islands)
We provide a number of important business services in China to young and emerging companies including (i) corporate business training services, which mainly focus on advanced knowledge and new perspectives on the capital markets, (ii) corporate consulting services, which mainly focus on various aspects of fundraising, and (iii) advisory and transaction services. Our main clients are entrepreneurs and executives in small and medium enterprises (“SMEs”) in China.
Corporate business training, corporate consulting, and advisory and transaction services constituted approximately 7%, 23% and 70% of our business, respectively, during the nine months ended Sept. 30, 2022.
Supported by the rapid economic growth and friendly business policies in China, the number of SMEs in China has significantly increased from 2016 to 2021. According to Frost & Sullivan, an independent market research firm, from 2016 to 2021, the number of SMEs in China increased from 13.9 million to 26.8 million with a compound annual growth rate (“CAGR”) of 14.0%. Frost & Sullivan expects the number of SMEs in China will steadily increase at 9.8% CAGR from 2021 to 2026. We believe that the increasing number of SMEs provide a solid foundation for the future development of our business.
With the increase in the number of companies entering the China market, most industries in China are becoming more competitive. Therefore founders, senior management teams and key employees of companies have an increasing awareness for professional business education in order to enhance their professional knowledge, boost their company’s strategic growth and allow the company to stay competitive in today’s economy.
China’s economy is shifting from traditional real estate investment and manufacturing to new economy industries such as internet-driven or technology-driven industries. Currently, the new economy industry has been a vital driving force in the growth of the economy in China. According to Frost & Sullivan, from 2016 to 2021, the market size of new economy industries by revenue in China experienced significant growth with 28.2% CAGR, which was much higher than the synchronized growth rate of 8.9% in China’s nominal GDP, attaining $4.0 trillion (RMB25.2 trillion) by the end of 2021. We believe that the rapid growth of new economy industries benefits the development of our business. Our mission is to provide comprehensive services to address client needs throughout all phases of their development and growth.
**Note: Revenue and net income figures are in U.S. dollars for the 12 months that ended Sept. 30, 2022.
(Top KingWin Ltd. filed its F-1 on Jan. 18, 2023, in which it disclosed terms for its IPO. The company submitted its confidential IPO documents to the SEC on Aug. 26, 2022.)
Golden Heaven Group Ltd. GDHG, 2.0M Shares, $4.00-5.00, $9.0 mil, 4/11/2023 Tuesday
Note: Investors in our ordinary shares (in the IPO) are purchasing equity interests in the Cayman Islands holding company, and not in the Chinese operating entities.
We are a Cayman Islands holding company and conduct our operations in China through Nanping Golden Heaven Amusement Park Management Co., Ltd. (“Golden Heaven WFOE”) and its subsidiaries. We hold 100% equity interests in our PRC subsidiaries, and we do not use a VIE structure.Through our subsidiaries, we operate six amusement parks and water parks in southern China.
As of the date of this prospectus, Golden Heaven WFOE has acquired 100% equity interests in the following PRC subsidiaries: (i) Changde Jinsheng Amusement Development Co., Ltd. (“Changde Jinsheng”), (ii) Qujing Jinsheng Amusement Investment Co., Ltd. (“Qujing Jinsheng”), (iii) Tongling Jinsheng Amusement Investment Co., Ltd. (“Tongling Jinsheng”), (iv) Yuxi Jinsheng Amusement Development Co., Ltd. (“Yuxi Jinsheng”), (v) Yueyang Jinsheng Amusement Development Co., Ltd. (“Yueyang Jinsheng”), and (vi) Mangshi Jinsheng Amusement Park Co., Ltd. (“Mangshi Jinsheng”).
Our corporate headquarters is in Yanping District, Nanping City, Fujian Province, China. According to government authorities in Fujian Province, Yanping District is known as “the birthplace of Chinese amusement park industry” and entrepreneurs from Yanping District have expanded beyond Yanping District and established their presence all across China. Through the operating entities, we are a leading amusement park operator in Yanping District and an active player in developing the Chinese amusement park industry. We aim to become the leading regional amusement park operator in China.
The parks of the operating entities occupy approximately 426,560 square meters of land in the aggregate and are located in geographically diverse markets across the south of China. Due to the geographical locations of the parks and the ease of travel, the parks are easily accessible to an aggregate population of approximately 21 million people. The parks offer a broad selection of exhilarating and recreational experiences, including both thrilling and family-friendly rides, water attractions, gourmet festivals, circus performances, and high-tech facilities. As of the date of this prospectus, the parks collectively contain 139 rides and attractions.
Our revenue is primarily generated from the Chinese operating entities’ selling access to rides and attractions, charging fees for special event rentals, and collecting regular rental payments from commercial tenants.
**Note: Revenue and net income figures are in U.S. dollars for the fiscal year that ended Sept. 30, 2022.
(Note: Golden Heaven Group Ltd. filed an F-1/A dated March 2, 2023, in which it slashed the size of its IPO to 2.0 million ordinary shares – down from 6.0 million shares – and kept the price range at $4.00 to $5.00 – to raise $9.0 million. Under the new terms, Golden Heaven Group’s IPO will raise $18 million less than under its original terms – a cut of 67 percent in the estimated IPO proceeds. Golden Heaven Group Ltd. filed an F-1/A on Feb. 17, 2023, and disclosed the terms for its IPO: 6.0 million ordinary shares at $4,00 to $5.00 to raise $27.0 million. Golden Heaven Group also updated its financial statements in the Feb. 17, 2023, F-1/A filing to include its revenue and net income for the fiscal year that ended Sept. 30, 2022. Background: Golden Heaven Group filed its F-1 on Nov. 4, 2022; it submitted confidential IPO documents to the SEC on June 22, 2022.)
U Power Ltd. UCAR, 2.5M Shares, $6.00-8.00, $17.5 mil, 4/12/2023 Wednesday
We are an electric vehicle (EV) battery-swapping technology company. (Holding company incorporated in the Cayman Islands)
We are a vehicle sourcing service provider in China, with a vision to becoming an EV market player primarily focused on our proprietary battery-swapping technology, or UOTTA technology, which is an intelligent modular battery-swapping technology designed to provide a comprehensive battery power solution for EVs.
Since our commencement of operations in 2013, we have principally engaged in the provision of vehicle sourcing services. We broker sales of vehicles between automobile wholesalers and buyers, including small and medium sized vehicle dealers (“SME dealers”) and individual customers primarily located in the lower-tier cities in China, which are smaller and less developed than the tier-1 or tier-2 cities. To that end, we have focused on building business relationships with our sourcing partners and have developed a vehicle sourcing network. As of the date of this prospectus, our vehicle sourcing network consisted of approximately 100 wholesalers and 30 SME dealers located in lower-tier cities in China.
Beginning in 2020, we gradually shifted our focus from the vehicle sourcing business to the development of our proprietary battery-swapping technology, or UOTTA technology. According to Frost & Sullivan, the PRC government will focus on promoting the electrification of commercial vehicles in the next few years, and it is expected that the sales volume of electric commercial vehicles will grow from 164.7 thousand units in 2021 to 431.0 thousand units in 2026 at a CAGR of 21.2% in China, and with the increasing penetration rates of electric commercial vehicles and the expanding battery-swapping infrastructure network, the market size by revenue of battery swapping solutions for electric commercial vehicle is expected to increase from approximately RMB8,661.5 million in 2021 to RMB176,615.1 million in 2026, representing a CAGR of 82.8%. In order to capture the opportunities arising from such growth, our plan is to develop a comprehensive EV battery power solution based on UOTTA technology, which mainly consists of: (i) vehicle-mounted supervisory control units that monitor the real-time status of an EV’s battery packs; (ii) customized vehicle control units (“VCUs”), which upload real-time data of the electric vehicle, such as its battery status, real-time location and safety status, to our data platform, using Bluetooth and/or Wi-Fi technologies; and (iii) our data management platform, which collects and synchronizes real-time information of the EVs uploaded by their respective VCUs, as well as information on the availability and locations of compatible UOTTA battery-swapping stations that assist drivers in locating the nearest compatible UOTTA battery-swapping station(s) available when the EV’s battery is determined to be lower than a certain level; and (iv) UOTTA battery-swapping stations designed for precise positioning, rapid disassembly, compact integration and flexible deployment of battery swapping for compatible EVs.
We have established in-house capabilities in the innovation of EV battery-swapping technology. Through our research and development efforts, we are developing an intellectual property portfolio. As of the date of this prospectus, we had 14 issued patents and 24 pending patent applications in China. Our research and development team is committed to technology innovation. As of the date of the prospectus, our research and development team consisted of 34 personnel and is led by Mr. Rui Wang and Mr. Zhanduo Hao, each of whom has experience of over 20 years in the electric power sector.
In 2021, leveraging years of automobile industry experience, we started cooperating with major automobile manufacturers to jointly develop UOTTA-powered EVs, by adapting selected EV models with our UOTTA technology. According to Frost & Sullivan, compared with passenger EV drivers, drivers of commercial-use EVs experience more range anxiety and are more motivated to shorten, or even eliminate, time spent on recharging EVs, therefore, we intend to primarily focus on developing commercial-use UOTTA-powered EVs, such as ride-hailing passenger EVs, small logistics EVs, light electric trucks, and heavy electric trucks, and their compatible UOTTA battery-swapping stations. As of the date of this prospectus, we have entered into cooperating agreements with two major Chinese automobile manufacturers, FAW Jiefang Qingdao Automotive Co., Ltd, and HUBEI TRI-RING Motor Co., Ltd, to jointly develop UOTTA-powered electric trucks. We also have engaged with two battery-swapping station manufacturers to jointly develop and manufacture UOTTA battery-swapping stations that are compatible with UOTTA-powered EVs. Our UOTTA battery-swapping stations are designed for precise positioning, rapid disassembly, compact integration and flexible deployment, allowing battery replacement within several minutes. As of the date of this prospectus, we realized sales of five battery-swapping stations. In August 2021, we completed the construction of our own battery-swapping station factory in Zibo City, Shandong Province (the “Zibo Factory”), which commenced manufacturing UOTTA battery-swapping stations in January 2022. We are also in the process of constructing another factory in Wuhu city, Anhui province (the “Wuhu Factory”), which is expected to commence production in 2023. In order to provide a comprehensive battery power solution based on UOTTA technology, we are in the process of developing a data management platform that connects UOTTA-powered EVs and stations, and assists the UOTTA-powered EV drivers in locating the closest compatible UOTTA swapping-stations on their routes. In January 2022, we started operating a battery-swapping station, pursuant to our station cooperation agreement with Quanzhou Xinao Transportation Energy Development Co., Ltd (“Quanzhou Xinao”), a local gas station operator in Quanzhou City, Fujian Province. Although we have made significant progress in entering into the EV market, there is no assurance that we will be able to execute our business plan to expand into the EV market as we have planned.
**Note: U Power Ltd. reported a net loss of $6.84 million on revenue of $1.75 million for the 12 months that ended June 30, 2022.
(Note: U Power Ltd. disclosed that WestPark Capital is the sole book-runner – and AMTD is no longer a joint book-runner teamed with WestPark Capital – according to an F-1/A filing dated March 27, 2023. U Power Ltd. disclosed terms for its IPO on March 8, 2023, in an F-1/A filing: 2.5 million shares at $6.00 to $8.00 to raise $17.5 million. U Power filed its F-1 on Dec. 22, 2022, and updated the filing with an F-1/A on Feb. 14, 2023 – without disclosing IPO terms.)
CytoMed Therapeutics Limited GDTC, 2.4M Shares, $4.00-5.00, $10.9mil, 4/14/2023 Friday
We are a holding company incorporated in Singapore (that) oversees our operations in Malaysia. The company was formerly known as CytoMed Therapeutics Pte. Ltd. We conduct our business activities primarily through our direct wholly owned subsidiary in Malaysia, CytoMed Malaysia, but may be commencing more research and clinical trial activities in Singapore through CytoMed moving forward.
We are a pre-clinical biopharmaceutical company focused on harnessing our licensed proprietary technologies to create novel cell-based immunotherapies to treat cancer. The development of our novel technologies has been inspired by the clinical success of existing CAR-T in treating hematological malignancies as well as the current clinical limitations and commercial challenges in extrapolating the CAR-T principle into treatment of solid tumors.
We believe that the current development of CD19-targeting CAR-T cells in treating B-cell malignancies signifies that cellular immunotherapy is becoming one of the pillars in cancer care. However, we believe that it remains challenging to apply the current CAR-T principle into treatments of other types of cancers, in particular solid tumors, due to a variety of reasons, including (i) the reliance on the limited cell quality and quantity of patients, (ii) the lack of suitable surface cancer antigens and their recognition system, and (iii) the ability of cancer to escape because of a single antigen-targeting strategy. To this end, we have established two novel patient blood cell-independent platform technologies to manufacture “off-the-shelf” cell-based cancer immunotherapies, meaning the manufacturing of the stated cell therapies in quantities, which utilizes either donor blood cells or iPSCs (induced Pluripotent Stem Cells) as starting materials, but not the limited patient’s own blood cells and no matching is required between such donor and recipient of the product. Our two novel platforms depend on healthy donor blood cells and induced pluripotent stem cells as starting material. Such platform technologies and the resulting product candidates exploit the multiple antigen recognition systems of NK cells and gamma delta T cells in the human body so as to recognize and treat a broad range of cancers.
Built on proprietary platform technologies, we are developing three product candidates: CTM-N2D, iPSC-gdNKT and CTM-GDT. CTM-N2D is our lead product candidate and it consists of expanded gamma delta T cells grafted with NKG2DL-targeting CAR to enhance anti-cancer cytotoxicity. We submitted a CTA application for a Phase I clinical trial to HSA, Singapore in December 2021, and, in July 2022, (we) were granted a CTA relating to the use of our CTM-N2D for the ANGELICA trial to be conducted with the National University Hospital Singapore, subject to conditions specified by the HSA. We expect to expand our pipeline further in Phase II trials of CTM-N2D therapy for specific cancer indications. Our second product candidate, iPSC-gdNKT, utilizes iPSC as a starting material to generate gdNKT, which is a synthetic hybrid of a gamma delta T cell and a NK cell. The hybrid cell express receptors of both cells potentially allow the gdNKT cells to recognize and treat a broad range of cancers. This product is currently undergoing pre-clinical development. Our third product candidate, CTM-GDT, consists of expanded gamma delta T cells (GDTCs) and exploits the GDTCs’ multiple recognition system to recognize and treat a broad range of cancers. We are looking to submit a CTX application for a Phase I clinical trial to NPRA, Malaysia after 2024. We have also appointed an agent in the United States to prepare a Drug Master File for a potential research collaboration in the United States.
**Note: Revenue and net loss figures are in U.S. dollars (converted from Singapore dollars) for the 12 months that ended June 30, 2022.
(Note: CytoMed Therapeutics Limited (formerly CytoMed Therapeutics Pte. Ltd.) filed terms for its IPO in an F-1/A filing dated Jan. 31, 2023: 2.41 million ordinary shares (2,412,369 ordinary shares) at $4.00 to $5.00 to raise $10.86 million. CytoMed Therapeutics filed its F-1 dated Nov. 18, 2022.)
(Note: Effective Jan. 17, 2023, a 1-for-380.83 reverse split of CytoMed’s ordinary shares went into effect, in which the shareholders received 1 ordinary share for every 380.83 ordinary shares held “as of such date,” the prospectus says.)
Emerging Market ETF Launches
Climate change and ESG are clearly the latest flavours of the month for most new ETFs. Nevertheless, here are some new frontier and emerging market focused ETFs:
1/31/2023 - Strive Emerging Markets Ex-China ETF STX - Passive, equity, emerging markets
1/20/2023 - Putnam PanAgora ESG Emerging Markets Equity ETF PPEM - Active, equity, ESG, emerging markets
1/12/2023 - KraneShares China Internet and Covered Call Strategy ETF KLIP - Active, equity, China, options overlay, thematic
1/11/2023 - Matthews Emerging Markets ex China Active ETF MEMX - Active, equity, emerging markets
12/13/2022 - GraniteShares 1.75x Long BABA Daily ETF BABX - Active, equity, leveraged, single stock
12/13/2022 - Virtus Stone Harbor Emerging Markets High Yield Bond ETF VEMY - Active, fixed income, junk bond, emerging markets
9/22/2022 - WisdomTree Emerging Markets ex-China Fund XC - Passive, equity, emerging markets
9/15/2022 - KraneShares S&P Pan Asia Dividend Aristocrats Index ETF KDIV - Passive, equity, Asia, dividend strategy
9/15/2022 - OneAscent Emerging Markets ETF OAEM - Active, Equity, emerging markets, ESG
9/9/2022 - Emerge EMPWR Sustainable Select Growth Equity ETF EMGC - Active, equity, emerging markets
9/9/2022 - Emerge EMPWR Unified Sustainable Equity ETF EMPW - Active, equity, emerging markets
9/8/2022 - Emerge EMPWR Sustainable Emerging Markets Equity ETF EMCH - Active, equity, emerging markets, ESG
7/14/2022 - Matthews China Active ETF MCH - Active, equity, China
7/14/2022 - Matthews Emerging Markets Equity Active ETF MEM - Active, equity, emerging markets
7/14/2022 - Matthews Asia Innovators Active ETF MINV - Active, equity, Asia
6/30/2022 - BondBloxx JP Morgan USD Emerging Markets 1-10 Year Bond ETF XEMD - Passive, fixed income, emerging markets
5/2/2022 - AXS Short CSI China Internet ETF SWEB - Active, inverse, thematic
4/27/2022 - Dimensional Emerging Markets High Profitability ETF DEHP - Active, equity, emerging markets
4/27/2022 - Dimensional Emerging Markets Core Equity 2 ETF DFEM - Active, equity, emerging markets
4/27/2022 - Dimensional Emerging Markets Value ETF DFEV - Active, equity, emerging markets
4/27/2022 - iShares Emergent Food and AgTech Multisector ETF IVEG - Passive, equity, thematic [Mostly developed markets]
4/21/2022 - FlexShares ESG & Climate Emerging Markets Core Index Fund FEEM - Passive, equity, ESG
4/6/2022 - India Internet & Ecommerce ETF INQQ - Passive, equity, thematic
2/17/2022 - VanEck Digital India ETF DGIN - Passive, India market, thematic
2/17/2022 - Goldman Sachs Access Emerging Markets USD Bond ETF GEMD - Passive, fixed income, emerging markets
1/27/2022 - iShares MSCI China Multisector Tech ETF TCHI - Passive, China, technology
1/11/2022 - Simplify Emerging Markets PLUS Downside Convexity ETF EMGD - Active, equity, options strategy
1/11/2022 - SPDR Bloomberg SASB Emerging Markets ESG Select ETF REMG - Passive, equity, ESG
Emerging Market ETF Closures/Liquidations
Frontier and emerging market highlights:
3/30/2023 - Invesco BLDRS Emerging Markets 50 ADR Index Fund - ADRE
3/30/2023 - Invesco BulletShares 2023 USD Emerging Markets Debt ETF - BSCE
3/30/2023 - Invesco BulletShares 2024 USD Emerging Markets Debt ETF - BSDE
3/30/2023 - Invesco PureBeta FTSE Emerging Markets ETF - PBEE
3/30/2023 - Invesco RAFI Strategic Emerging Markets ETF - ISEM
2/17/2023 - Direxion Daily CSI 300 China A Share Bear 1X Shares - CHAD
1/13/2023 - First Trust Chindia ETF - FNI
12/28/2022 - Franklin FTSE Russia ETF - FLRU
12/22/2022 - VictoryShares Emerging Market High Div Volatility Wtd ETF CEY
8/22/2022 - iShares MSCI Argentina and Global Exposure ETF AGT
8/22/2022 - iShares MSCI Colombia ETFI COL
6/10/2022 - Infusive Compounding Global Equities ETF JOYY
5/3/2022 - ProShares Short Term USD Emerging Markets Bond ETF EMSH
4/7/2022 - DeltaShares S&P EM 100 & Managed Risk ETF DMRE
3/11/2022 - Direxion Daily Russia Bull 2X Shares RUSL
1/27/2022 - Legg Mason Global Infrastructure ETF INFR
1/14/2022 - Direxion Daily Latin America Bull 2X Shares LBJ
Check out our emerging market ETF lists, ADR lists (updated) and closed-end fund (updated) lists (also see our site map + list update status as some ETF lists are still being updated as of Summer 2022).
I have changed the front page of www.emergingmarketskeptic.com to mainly consist of links to other emerging market newspapers, investment firms, newsletters, blogs, podcasts and other helpful emerging market investing resources. The top menu includes links to other resources as well as a link to a general EM investing tips / advice feed e.g. links to specific and useful articles for EM investors.
Disclaimer. The information and views contained on this website and newsletter is provided for informational purposes only and does not constitute investment advice and/or a recommendation. Your use of any content is entirely at your own risk and it is your sole responsibility to evaluate the accuracy, completeness and usefulness of the content. Seek a duly licensed professional for any investment advice. I may have positions in the investments covered. This is not a recommendation to buy or sell any investment mentioned.
Emerging Market Links + The Week Ahead (April 10, 2023) was also published on our website under the Newsletter category.