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ESSEX BIO-TECH(1061)
Analysis：
ESSEX BIO-TECH is a leading ophthalmology and surgical drug manufacturer and promoter in China. Driven by the core patent drug bFGF, the company`s five-year revenue CAGR has increased by more than 20% annually, and the profit CAGR more than 30% annually. Since the launch of the “Enhancement Plan” in 2015, the company has successfully invested in different targets and cooperated in various markets. Recently, the company signed an agreement with Russian Mitotech to obtain the permanent commercialization rights of its third-phase clinical dry eye products in Singapore and Greater China at a price of up to US$37 million, while sharing global benefits. In addition, ESSEX BIO-TECH recently invested 8% stake in the company "Shanggong Yixin", which focuses on fundus screening and chronic disease management and has an AI fundus screening products "Huiyantangwang". In addition, the company recently launched the first single-dose levofloxacin eye drop product without preservatives.
Strategy：
Buy-in Price: $7.00, Target Price: $8.70, Cut Loss Price: $6.05
Apple Inc. (AAPL)
Apple Inc. and its wholly-owned subsidiaries provide products and services including design, manufactures, markets mobile communication, media devices, personal computers, portable digital music players, and a variety of related software, services, peripherals, networking solutions, and third-party digital content and applications. On 30th of April 2019, Apple Inc. reported a better-than-expected earning on its Q2 period. It posted revenue of $58 billion, a quarterly profit of nearly $11.6 billion, and EPS of $2.46 which exceed analyst estimation of $57 billion revenue and $2.36 EPS. On a year-over-year basis, there is a decrease in both revenue as well as EPS. But it is expected due to the slower demand for new iPhones. This quarter strong result was led by strong performance from wearables, iPads as well as continued growth from service segment. iPad revenue jumped by more than 20% year over year, while service revenue reach $11.5 billion, setting an all-time quarterly record. In the coming years, Apple will release more subscription service to increase source of revenue, e.g. Apple Arcade, Apple News+, Apple TV+ as well as Apple Card. It is expected that strong growth in the service segment will continued into the next few quarters. And it is also a good sign for investor that Apple is not solely relying on iPhone as main source of revenue, services and wearable devices are having a significant part as well. Given the steady growth we are expecting in the coming quarters, It is recommended to purchase at $208, target price $243, cut loss if drop below $195.
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Report Review of April 2019
Sectors: Air, Automobiles (ZhangJing) TMT, Education, Finance (Terry Li) Automobile & Air (ZhangJing)This month I released 4 updated reports of SIA (600009.CH), Air China(AC) (753.HK), Jonjee Hi-Tech (600872.CH) and China Eastern Airlines (670.HK), which got success by their unique Competitive edge. Among them, we prefer SIA first. Unlike the restricted aeronautical business, the SIA's non-aeronautical business recorded a sustained rapid growth up to RMB5.34 billion, with a surge of 23.2% yoy. Wherein, the commercial rental revenue increased by 33% yoy, up to RMB3.986 million, mainly benefiting from the increased proportion of international tourists with stronger consumption intention and the Company's sustained management, site optimization and adjustment of commercial retail brands. Of the commercial rental, over RMB3.5 million are from duty-free stores, the total volume and per customer transaction (RMB300/per customer) of which both recorded a rapid growth, with a growth rate of around 40% and 20% yoy, respectively, reflecting that duty-free stores in Pudong Airport were becoming a shopping hotspot for international routes passengers. TMT, Education & Finance (Terry Li)I released four reports on Travelsky Technology (696.HK), HC Group (2280.HK), China Education Group (839.HK) and China Maple Leaf Education (1317.HK). We highly recommend China Education Group. On Mar 20, the Group has announced to acquire the remaining 49.09% equity interest of Quancheng University at a total consideration of RMB 223 million. Quancheng University is located in Penglai city, Shandong province, and the Independent college of Jinan University. Among those independent colleges in Shandong, the admission marks for bachelor-degree in 2018 (science track) were the highest, 454. Besides, the tuition of the bachelor-degree program was only RMB 11,000, lower than the average of private universities and independent colleges in Shangdong (RMB 13,500), meaning there will still be room to grow. Finally, the utilization of the school was just 86%, and the remaining space available can further accommodate about 1,400 students. The maximum capacity of the campus is approximately 23,000 students more after the renovation and building new dormitories. Thanks to the potential increase in tuition and student enrollment, we believe it is a satisfactory acquisition target. Besides, on Mar 21, the Group announced the issuance of a HK$2,355 million five-year convertible bond with an annual interest rate of 2% and a conversion price of HK$14.69 per share. The previous gearing ratio target the Group provided was 40%-50%. We expect the gearing ratio will reach 35%-40% after this issuance of bonds, implying that there will still be room for further financing. In addition, as it is the convertible bonds to be issued, the gearing ratio may reduce once the conversion is done, enabling the Group for another financing. Assuming the acquisition price of an new school takes RMB 600-700 million, the capital financed will be enough for acquiring 3 new schools. 
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