< The 2016 All-Asia Research Team

Total appearances: 8

Team debut: 2003

In third place are John (Jake) Lynch and his seven-strong, Hong Kong–based contingent at Macquarie Capital Securities, which falls from No. 1. Despite their decline, the regional small- and midcap analysts continue to garner client applause for their comprehensive coverage, idea generation and stock-picking ability. For example, one fund manager lauds the group for its “early call on Tianneng Power [International], which has performed so well.” A manufacturer of motive power products used primarily in electric bicycles, China’s Tianneng scored an outperform rating when Lynch and his associates launched coverage in October. Citing pricing stability for its lead-acid batteries and a buildup in lithium products, among other factors, they project a turnaround to net profitability and compound annual growth of 20 percent for the year ahead. Although the bike market is maturing, replacement demand should further bolster demand, they contend, noting also Tianneng’s scale and price premium advantage compared with peers. By late April the Hong Kong–listed shares had soared 48.3 percent, to HK$7.61, while the sector was flat and the regional broad market fell 2.4 percent. Looking ahead, Macquarie predicts that South Korea’s Loen Entertainment will continue to be a standout performer. In June the share price was 63,400 won — having doubled during the preceding 12-month period, while its regional peers gained 10 percent — and the team highlighted its positive outlook, pointing to the record label’s strong Spotify-like MelOn streaming music service. Then in March, with Leon trading at 85,000 won, it restated its outperform position and hiked its price target by 11 percent, to 111,000 won. The company had by then accepted a 1.87 trillion won ($1.5 billion) offer to be acquired by one of its home country’s largest Internet players, Kakao Corp., and the researchers are hailing the potential benefits of the attendant addition of 39 million KakaoPay mobile-messaging subscribers. “The move to KakaoPay is not being priced properly right now,” insists Lynch, 47. Loen closed at 81,900 won in late April, up 29.2 percent since the analysts’ June reiteration and ahead of Asia ex-Japan’s small and midcap names overall by 39.8 percentage points.