Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Bottom-Up

<ul>
<li>SK Square owns a 20.07% stake in SK Hynix which is now worth 27.2 trillion won. SK Square's market cap is only 39% of SK Square's stake in SK Hynix.</li>
<li>SK Square has benefited from increased capital allocation to low P/B stocks in Korea due to the Corporate Value Up program. SK Square is trading at P/B of 0.7x. </li>
<li>Amid the tremendous demand for Nvidia's AI related chips, this has also benefited several Korean companies including SK Hynix and SK Square. </li>
</ul>


SK Square owns a 20.07% stake in SK Hynix which is now worth 27.2 trillion won. SK Square's market cap is only 39% of SK Square's stake in SK Hynix.
SK Square has benefited from increased capital allocation to low P/B stocks in Korea due to the Corporate Value Up program. SK Square is trading at P/B of 0.7x. 
Amid the tremendous demand for Nvidia's AI related chips, this has also benefited several Korean companies including SK Hynix and SK Square. 


SK Square: Higher NAV Driven by Its Holding in SK Hynix

HDC Hyundai Development Co-Engineering & Construction / Equity Bottom-Up

HDC Hyundai Development Co-Engineering & Construction

<ul>
<li>In this insight, we highlight the recent pricing gap divergences of the major Korean holdcos and opcos which could provide trading opportunities in 2Q 2024.</li>
<li>Of the 38 pair trades, 26 of them involved holdcos outperforming opcos in the past six months, suggesting increased capital allocation to Korean holdcos relative to their opcos.  </li>
<li>These pairs could generate trading opportunities in terms of their pricing gaps closing reversal. [CJ Corp vs CJ Cheiljedang &amp; Hanjin KAL Corp vs Korean Air Lines].</li>
</ul>


In this insight, we highlight the recent pricing gap divergences of the major Korean holdcos and opcos which could provide trading opportunities in 2Q 2024.
Of the 38 pair trades, 26 of them involved holdcos outperforming opcos in the past six months, suggesting increased capital allocation to Korean holdcos relative to their opcos.  
These pairs could generate trading opportunities in terms of their pricing gaps closing reversal. [CJ Corp vs CJ Cheiljedang &amp; Hanjin KAL Corp vs Korean Air Lines].


Korean Holdcos Vs Opcos Gap Trading Opportunities in 2Q 2024

Korea / Special Situations, Clepsydra Capital

Sanghyun Park

Korea / Special Situations

Korea / Special Sits, Pairs, Index Rebalancing

Clepsydra Capital

Investigate special situations, pairs, and index rebalancing trades in Korea.

Event-Driven

<ul>
<li>KRX limits individual stock weight to 20% in ETFs with few constituents. KRX confirms working on it, with an official announcement expected soon.</li>
<li>Excludes index ETFs like KOSPI 200. KRX hasn't finalized criteria for constituent number but expected to involve fewer than 30 stocks.</li>
<li>This could open new passive trading opportunities. Sector ETF cap at 30%, large AUM ones offer noteworthy trading potential.</li>
</ul>


KRX limits individual stock weight to 20% in ETFs with few constituents. KRX confirms working on it, with an official announcement expected soon.
Excludes index ETFs like KOSPI 200. KRX hasn't finalized criteria for constituent number but expected to involve fewer than 30 stocks.
This could open new passive trading opportunities. Sector ETF cap at 30%, large AUM ones offer noteworthy trading potential.


KRX Imposes a 20% Cap on Weight Ceiling in Sector ETFs with Few Constituents

Asia Pac IPO & Placement Research, China biotech, Aequitas Research

Ke Yan, CFA, FRM

Asia Pac IPO & Placement Research, China biotech

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.

Quantitative Analysis

<ul>
<li>We analyzed the changes in foreign holdings of KRX Stocks as of Mar 29th which has an aggregated holding worth USD550.4bn.</li>
<li>We estimate that foreign flows to be inflows of USD2,332mln. We tabulate the league table for top changes by value for 1W/4W/1Y and top stocks held by foreign institutions.</li>
<li>We highlight foreign changes in Samsung Electronics, Sk Hynix, Lg Display, Ecopro, Hanmi Semicon.</li>
</ul>


We analyzed the changes in foreign holdings of KRX Stocks as of Mar 29th which has an aggregated holding worth USD550.4bn.
We estimate that foreign flows to be inflows of USD2,332mln. We tabulate the league table for top changes by value for 1W/4W/1Y and top stocks held by foreign institutions.
We highlight foreign changes in Samsung Electronics, Sk Hynix, Lg Display, Ecopro, Hanmi Semicon.


KRX Foreign Holding Weekly (Mar 29th): Samsung Electronics, Sk Hynix, Lg Display, Ecopro, Hanmi

Thematic (Sector/Industry)

<ul>
<li>Recent trends in the most viewed local brokerage research reports by Korean institutions, compiled by FnGuide, offer insights into current investor interests.</li>
<li>Notable resurgence in local institution interest in the semiconductor sector, especially with the temporal gap until May when the Value-up momentum materializes, notably evident in the AI semiconductor rally companies.</li>
<li>Local institutions typically follow stocks of their interest with a slight lag. This suggests potential positive flows in the listed semiconductor companies until the Value-up momentum solidifies in May.</li>
</ul>


Recent trends in the most viewed local brokerage research reports by Korean institutions, compiled by FnGuide, offer insights into current investor interests.
Notable resurgence in local institution interest in the semiconductor sector, especially with the temporal gap until May when the Value-up momentum materializes, notably evident in the AI semiconductor rally companies.
Local institutions typically follow stocks of their interest with a slight lag. This suggests potential positive flows in the listed semiconductor companies until the Value-up momentum solidifies in May.


Introducing a Data Source for Korean Local Institutions' Interests

South Korea

SK Hynix Inc. provides products and services for the electronic components industry. The Company manufactures semiconductors, such as dynamic random access memory (DRAM), NAND flash memory, and static random access memory (SRAM) chips.

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SK Hynix (000660 KS)

SK Square: Higher NAV Driven by Its Holding in SK Hynix

SK Square owns a 20.07% stake in SK Hynix which is now worth 27.2 trillion won. SK Square's market cap is only 39% of SK Square's stake in SK Hynix.

Douglas Kim

Korean Holdcos Vs Opcos Gap Trading Opportunities in 2Q 2024

In this insight, we highlight the recent pricing gap divergences of the major Korean holdcos and opcos which could provide trading opportunities in...

Douglas Kim

KRX Imposes a 20% Cap on Weight Ceiling in Sector ETFs with Few Constituents

This post details what I confirmed with KRX regarding its new rule of imposing a 20% cap on the weight ceiling for the sector ETFs having few...

Sanghyun Park

KRX Foreign Holding Weekly (Mar 29th): Samsung Electronics, Sk Hynix, Lg Display, Ecopro, Hanmi

We analyzed KRX foreign holding data for the past week and highlighted foreign holding changes in Samsung Electronics, Sk Hynix, Lg Display,...

Ke Yan, CFA, FRM

Introducing a Data Source for Korean Local Institutions' Interests

This post introduces a data source that offers precise insights into the preferences of local institutions regarding stocks.

Sanghyun Park

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52-week Range

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