Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

Event-Driven

<ul>
<li>Palliser Capital started to go activist on LG Chem.  According to Palliser Capital, LG Chem's share price is trading at a 74% discount to its NAV.</li>
<li>Palliser Capital proposed improving the composition of the board of directors, restructuring the executive compensation system to align with shareholder interests, and higher share buybacks. </li>
<li>Our updated NAV analysis of LG Chem suggests implied price of 613,438 won per share, which represents a 57% higher levels than current levels.</li>
</ul>


Palliser Capital started to go activist on LG Chem.  According to Palliser Capital, LG Chem's share price is trading at a 74% discount to its NAV.
Palliser Capital proposed improving the composition of the board of directors, restructuring the executive compensation system to align with shareholder interests, and higher share buybacks. 
Our updated NAV analysis of LG Chem suggests implied price of 613,438 won per share, which represents a 57% higher levels than current levels.


Palliser Capital Goes Activist on LG Chem

<ul>
<li>LG Chem announced that it plans to complete a price return swap worth about 2 trillion won (US$1.4 billion) using its stake in LG Energy Solution as the base asset.</li>
<li>This 2 trillion won PRS is likely to have a slightly positive impact on LG Chem and slightly negative impact on LG Energy Solution.</li>
<li>Our NAV valuation of LG Chem suggests implied NAV per share of 369,187 won, which is 31% higher than current levels.</li>
</ul>


LG Chem announced that it plans to complete a price return swap worth about 2 trillion won (US$1.4 billion) using its stake in LG Energy Solution as the base asset.
This 2 trillion won PRS is likely to have a slightly positive impact on LG Chem and slightly negative impact on LG Energy Solution.
Our NAV valuation of LG Chem suggests implied NAV per share of 369,187 won, which is 31% higher than current levels.


LG Chem: Announces a PRS Worth 2 Trillion Won Using Its Shares in LG Energy Solution as Base Asset

Equity Bottom-Up

<ul>
<li>In the past three months, LG Chem has announced two asset sales worth 1.6 trillion won including dermal filler and water filter businesses. </li>
<li>Due to worsening balance sheet and need to raise additional capital, there is an increasing probability of LG Chem selling a partial stake in LGES in the next 6-12 months.</li>
<li>Our NAV valuation of LG Chem suggests implied NAV per share of 414,325 won, which is 49% higher than current levels.</li>
</ul>


In the past three months, LG Chem has announced two asset sales worth 1.6 trillion won including dermal filler and water filter businesses. 
Due to worsening balance sheet and need to raise additional capital, there is an increasing probability of LG Chem selling a partial stake in LGES in the next 6-12 months.
Our NAV valuation of LG Chem suggests implied NAV per share of 414,325 won, which is 49% higher than current levels.


LG Chem: Flurry of Asset Sales Raises the Probability of A Partial Sale of LG Energy Solution

External broker reports(aggregated public sources), Mirae Asset Securities

Mirae Asset Securities

External broker reports(aggregated public sources)

Leading full-service brokerage firm in Vietnam. 

Content available is external broker reports authored by a third party outside the Smartkarma network and has been aggregated by an online aggregator through publicly available sources and is displayed by Smartkarma in this format for user's convenience and general informational purposes only. Content does not constitute investment or financial advice and Smartkarma makes no representation or warranty regarding its accuracy or contents. Original third party author retains all copyright and other proprietary rights in the content. Access or use of third party links not controlled by Smartkarma are at the user's own risk.

<ul><li>High expectations for battery subsidiaryRaise TP to W360,000 and maintain Buy We maintain our Buy rating on LG Chem and raise our target price to W360,000 (from W290,000)</li><li>Our upward revision reflects: 1) growing expectations for battery subsidiary LG Energy Solution (LGES), especially in the ESS segment; and 2) the rising likelihood that the company will soon sell stakes in certain subsidiaries</li><li>LGES is likely to deliver improved earnings following recent large-scale ESS battery order wins, which should also drive positive momentum for LG Chem</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

High expectations for battery subsidiaryRaise TP to W360,000 and maintain Buy We maintain our Buy rating on LG Chem and raise our target price to W360,000 (from W290,000)Our upward revision reflects: 1) growing expectations for battery subsidiary LG Energy Solution (LGES), especially in the ESS segment; and 2) the rising likelihood that the company will soon sell stakes in certain subsidiariesLGES is likely to deliver improved earnings following recent large-scale ESS battery order wins, which should also drive positive momentum for LG ChemContent is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

LG Chem (051910 KS/Buy)High expectations for battery subsidiary

Equity Derivatives and Volatility Specialist, Clifton Derivatives

John Ley

Equity Derivatives and Volatility Specialist

Clifton Derivatives

Independent derivative and volatility research firm focusing on events/catalysts, earnings, relative value and cross asset volatility strategies.

Equity Derivatives

<ul>
<li>
<a href="https://www.smartkarma.com/entities/hong-kong-hang-seng-index" target="_blank" data-smartkarma-citation="entities:22899" rel="noopener">Hang Seng Index (HSI INDEX)</a>, <a href="https://www.smartkarma.com/entities/shanghai-shenzhen-csi-300-index" target="_blank" data-smartkarma-citation="entities:22906" rel="noopener">Shanghai Shenzhen CSI 300 Index (SHSZ300 INDEX EQUITY)</a> and <a href="https://www.smartkarma.com/entities/nikkei-225" target="_blank" data-smartkarma-citation="entities:22909" rel="noopener">Nikkei 225 (NKY INDEX)</a> all have elevated implied vols vs their peers and vs historical observations for October.</li>
<li>
<a href="https://www.smartkarma.com/entities/nifty-index" target="_blank" data-smartkarma-citation="entities:23617" rel="noopener">NIFTY Index (NIFTY INDEX)</a> , <a href="https://www.smartkarma.com/entities/s-p-500-index" target="_blank" data-smartkarma-citation="entities:22886" rel="noopener">S&amp;P 500 INDEX (SPX INDEX)</a> and <a href="https://www.smartkarma.com/entities/s-p-asx-200" target="_blank" data-smartkarma-citation="entities:22901" rel="noopener">S&amp;P/ASX 200 (AS51 INDEX)</a>  implied vols are on the low end of what is typically realized in October.</li>
<li>Most markets see price weakness in the 3rd week of the month with realized volatility underperforming over the back half of the month.</li>
</ul>



Hang Seng Index (HSI INDEX), Shanghai Shenzhen CSI 300 Index (SHSZ300 INDEX EQUITY) and Nikkei 225 (NKY INDEX) all have elevated implied vols vs their peers and vs historical observations for October.

NIFTY Index (NIFTY INDEX) , S&amp;P 500 INDEX (SPX INDEX) and S&amp;P/ASX 200 (AS51 INDEX)  implied vols are on the low end of what is typically realized in October.
Most markets see price weakness in the 3rd week of the month with realized volatility underperforming over the back half of the month.


EQD | Asia Monthly Vol Roadmap: Elevated IV's in CSI300 and Hang Seng Present Tactical Opportunity

South Korea

LG Chem Ltd. is a chemical manufacturer. The Company's products include petrochemicals, plastic resins, and engineering plastics. LG Chem also produces industrial and electronic materials.

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LG Chem (051915 KS)

Palliser Capital Goes Activist on LG Chem

Palliser Capital started to go activist on LG Chem. According to Palliser Capital, LG Chem's share price is trading at a 74% discount to its NAV.

Douglas Kim

LG Chem: Announces a PRS Worth 2 Trillion Won Using Its Shares in LG Energy Solution as Base Asset

On 1 October, LG Chem announced that it plans to complete a price return swap (PRS) worth about 2 trillion won (US$1.4 billion) using its stake in...

Douglas Kim

LG Chem: Flurry of Asset Sales Raises the Probability of A Partial Sale of LG Energy Solution

There were numerous local media accounts that mentioned LG Chem is in discussions with several securities firms to raise 2-3 trillion won using its...

Douglas Kim

LG Chem (051910 KS/Buy)High expectations for battery subsidiary

High expectations for battery subsidiaryRaise TP to W360,000 and maintain Buy We maintain our Buy rating on LG Chem and raise our target price to...

Mirae Asset Securities

EQD | Asia Monthly Vol Roadmap: Elevated IV's in CSI300 and Hang Seng Present Tactical Opportunity

Implied volatility levels across key Asian indices present several tactical opportunities this month for outright or pairs trades...

John Ley

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Palliser Capital Goes Activist on LG Chem

Palliser Capital started to go activist on LG Chem. According to Palliser Capital, LG Chem's share price is trading at a 74% discount to its NAV.

Douglas Kim

LG Chem: Announces a PRS Worth 2 Trillion Won Using Its Shares in LG Energy Solution as Base Asset

On 1 October, LG Chem announced that it plans to complete a price return swap (PRS) worth about 2 trillion won (US$1.4 billion) using its stake in...

Douglas Kim

LG Chem: Flurry of Asset Sales Raises the Probability of A Partial Sale of LG Energy Solution

There were numerous local media accounts that mentioned LG Chem is in discussions with several securities firms to raise 2-3 trillion won using its...

Douglas Kim

LG Chem (051910 KS/Buy)High expectations for battery subsidiary

High expectations for battery subsidiaryRaise TP to W360,000 and maintain Buy We maintain our Buy rating on LG Chem and raise our target price to...

Mirae Asset Securities

EQD | Asia Monthly Vol Roadmap: Elevated IV's in CSI300 and Hang Seng Present Tactical Opportunity

​Implied volatility levels across key Asian indices present several tactical opportunities this month for outright or pairs trades...

John Ley

Implied volatility levels across key Asian indices present several tactical opportunities this month for outright or pairs trades...