Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Event-Driven

<ul>
<li>At the October rebalance, there are 970 stocks that will have a lower FFW while 114 stocks will have a higher FFW. 493 stocks will undergo a Phased Weight Reduction.</li>
<li>Estimated one-way turnover is 2.54% resulting in a one-way trade of ¥1.815tn. 500 stocks have over 4 days ADV to trade, 100 stocks have over 9 days ADV to trade.</li>
<li>Setting the threshold at +/-US$50m to trade, the stocks with inflows have outperformed the stocks with outflows by 6.5% over the last four months.</li>
</ul>


At the October rebalance, there are 970 stocks that will have a lower FFW while 114 stocks will have a higher FFW. 493 stocks will undergo a Phased Weight Reduction.
Estimated one-way turnover is 2.54% resulting in a one-way trade of ¥1.815tn. 500 stocks have over 4 days ADV to trade, 100 stocks have over 9 days ADV to trade.
Setting the threshold at +/-US$50m to trade, the stocks with inflows have outperformed the stocks with outflows by 6.5% over the last four months.


TOPIX October Rebalance: BIG One With ¥1.8tn a Side to Trade

Managing Director, Zero One, Zero One

Vincent Fernando, CFA

Managing Director, Zero One

Equity Bottom-Up

<ul>
<li>We had a call with <a href="https://www.smartkarma.com/entities/delta-electronics-inc" target="_blank" data-smartkarma-citation="entities:12688:1" rel="noopener">Delta Electronics (2308 TT)</a> management to understand the company’s latest developments, particularly in relation to its growing automotive and EV businesses.</li>
<li>Delta Thailand shares have rallied 55.4% in T$ terms, while Delta Taiwan has only rallied 9.3%.</li>
<li>Delta’s EV business is growing 50% per year and has major customers including Tesla, GM, and Volkswagen, however, our sense is the Taiwan entity has an advantage. </li>
</ul>


We had a call with Delta Electronics (2308 TT) management to understand the company’s latest developments, particularly in relation to its growing automotive and EV businesses.
Delta Thailand shares have rallied 55.4% in T$ terms, while Delta Taiwan has only rallied 9.3%.
Delta’s EV business is growing 50% per year and has major customers including Tesla, GM, and Volkswagen, however, our sense is the Taiwan entity has an advantage. 


Delta Electronics: Taiwan Vs. Thailand Pairs Monitor, Call with Management

Japan Specialist

Mark Chadwick

<ul>
<li>Denso started the fiscal year with an overly optimistic view of Toyota production – it is now too bearish </li>
<li>Chip shortages and supply disruptions are starting to ease, making it easier for automakers to meet end demand </li>
<li>We are bullish on the stock as we believe that Denso’s earnings will beat lowered guidance and valuations are at the bottom of the range </li>
</ul>


Denso started the fiscal year with an overly optimistic view of Toyota production – it is now too bearish 
Chip shortages and supply disruptions are starting to ease, making it easier for automakers to meet end demand 
We are bullish on the stock as we believe that Denso’s earnings will beat lowered guidance and valuations are at the bottom of the range 


Denso (6902) | No Reason to Be Uber-Bearish

Global Automotive Stocks/EV Focus/Event Driven, SC Capital

SC Capital

Global Automotive Stocks/EV Focus/Event Driven

Over 22 years covering Japanese equities on both the sell side and the buy side. 

Bottom-up Japan Equities Research

<ul>
<li>Toyota announces June quarter results at 13:25 JST on Thursday, August 4th JST. <strong>We think any dip is a buying opportunity</strong>. </li>
<li>Contrary to consensus, Q1's constraints were due to supplier lockdowns in Shanghai, not the chip shortage. In fact, Toyota is seeing larger than expected chip supplies. </li>
<li>Toyota's full-year guidance is the most low-balled in the industry, which is why it's underperformed peers. Better Q2 chip supply should lead to a sharp upward revision after 1H FY3/23. </li>
</ul>


Toyota announces June quarter results at 13:25 JST on Thursday, August 4th JST. We think any dip is a buying opportunity. 
Contrary to consensus, Q1's constraints were due to supplier lockdowns in Shanghai, not the chip shortage. In fact, Toyota is seeing larger than expected chip supplies. 
Toyota's full-year guidance is the most low-balled in the industry, which is why it's underperformed peers. Better Q2 chip supply should lead to a sharp upward revision after 1H FY3/23. 


Toyota Motor's Bad Q1 Is a Buying Opportunity

Senior Technology Analyst, Japanese Equities, LightStream Research

Scott Foster

Senior Technology Analyst, Japanese Equities

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

<ul>
<li>Aided by the weak yen, Imaging &amp; Sensing Solutions should return as a major profit driver in FY Mar-23.</li>
<li>Capacity expansion should help SONY regain image sensor market share over the next 3-4 years.</li>
<li>Participation in TSMC's foundry project in Kyushu should add to the division's long-term potential.</li>
</ul>


Aided by the weak yen, Imaging &amp; Sensing Solutions should return as a major profit driver in FY Mar-23.
Capacity expansion should help SONY regain image sensor market share over the next 3-4 years.
Participation in TSMC's foundry project in Kyushu should add to the division's long-term potential.


Sony (6758 JP): Image Sensors Set for Rebound & Long-Term Expansion

Japan

DENSO CORPORATION manufactures electronic parts for automobiles.  The Company's products include automobile air conditioners, air bags, ignition systems, generators, power steering systems, and spark plugs with iridium electrode. The Company also produces communication equipment for mobile navigation system.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Denso Corp (6902 JP)

TOPIX October Rebalance: BIG One With ¥1.8tn a Side to Trade

Lower FFWs on 970 stocks and higher FFWs on 114 stocks will result in one-way turnover of 2.52% leading to a one-way trade of ¥1.8tn at the close...

Brian Freitas

Delta Electronics: Taiwan Vs. Thailand Pairs Monitor, Call with Management

We had a call with Delta Electronics (2308 TT) management to understand the company’s latest developments, particularly in relation to its growing...

Vincent Fernando, CFA

Denso (6902) | No Reason to Be Uber-Bearish

Denso became too conservative on auto production volumes just as things were starting to get better. Toyota kept its full year guidance for...

Mark Chadwick

Toyota Motor's Bad Q1 Is a Buying Opportunity

Toyota Motor announces quarterly results today. Expectations are super low. We expect dip buying even if results undershoot estimates & recommend...

SC Capital

Sony (6758 JP): Image Sensors Set for Rebound & Long-Term Expansion

Image sensors should return as a major profit driver this year. Capacity expansion should help the company regain market share. The weak yen and...

Scott Foster

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)