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.

Index Rebalance

<ul>
<li>FnGuide Samsung Group has the most AUM among locally themed indexes. As of last Friday's closing price, AUM is ₩1.52T.</li>
<li>The share price movements of Samsung Group affiliates basically show high cointegration. Therefore, a small differential impact on the flow significantly affects the short-term price direction of these stocks. </li>
<li>So, we should consider a long/short setup on a swing trading window. Particularly, we need to focus on the first two trading days, when the rebalancing impact is relatively significant.</li>
</ul>


FnGuide Samsung Group has the most AUM among locally themed indexes. As of last Friday's closing price, AUM is ₩1.52T.
The share price movements of Samsung Group affiliates basically show high cointegration. Therefore, a small differential impact on the flow significantly affects the short-term price direction of these stocks. 
So, we should consider a long/short setup on a swing trading window. Particularly, we need to focus on the first two trading days, when the rebalancing impact is relatively significant.


FnGuide Samsung Group Index Rebalancing Preview

Event-Driven

<ul>
<li>The local street hears KRX has bumped it up to 14.68%. With the 1% rounding applied, it becomes 15%.</li>
<li>It is extremely rare for a Fast Entry to come in with a float market cap of +₩10T. So, we will see significant weight adjustments for the other constituents.</li>
<li>As we move towards the implementation date, we can consider basket-shorting those high-impact names for LG Energy's long hedge.</li>
</ul>


The local street hears KRX has bumped it up to 14.68%. With the 1% rounding applied, it becomes 15%.
It is extremely rare for a Fast Entry to come in with a float market cap of +₩10T. So, we will see significant weight adjustments for the other constituents.
As we move towards the implementation date, we can consider basket-shorting those high-impact names for LG Energy's long hedge.


LG Energy's KOSPI 200 Float Is 15%: Weight Adjustment Trading for Other Constituents

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>
<a href="https://www.smartkarma.com/entities/sk-square-co-ltd" target="_blank" data-smartkarma-citation="entities:35264:1" rel="noopener">SK Square (402340 KS)</a> was inexpensive after its November listing. Now it's even cheaper. </li>
<li>Preceding my comments on SK Square - and <a href="https://www.smartkarma.com/entities/lg-chem-ltd" target="_blank" data-smartkarma-citation="entities:3583:1" rel="noopener">LG Chem Ltd (051910 KS)</a> - are the current setup/unwind tables for Asia-Pacific Holdcos. </li>
<li>These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation &gt;20%.</li>
</ul>



SK Square (402340 KS) was inexpensive after its November listing. Now it's even cheaper. 
Preceding my comments on SK Square - and LG Chem Ltd (051910 KS) - are the current setup/unwind tables for Asia-Pacific Holdcos. 
These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation &gt;20%.


StubWorld: SK Square And LG Chem's Unjustified NAV Discounts

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

<ul>
<li>We have a Negative view on this nearly 3 trillion won rights offering by Samsung Biologics.</li>
<li>The expected price of the rights offering is 599,000 won which is 18.9% below current share price and would represent about 7% shares dilution.</li>
<li>Despite the long-term positive prospects of consolidating results from Samsung Bioepsis, we believe the acquisition price was a bit too high at more than 100% higher than Biogen's valuation multiples.</li>
</ul>


We have a Negative view on this nearly 3 trillion won rights offering by Samsung Biologics.
The expected price of the rights offering is 599,000 won which is 18.9% below current share price and would represent about 7% shares dilution.
Despite the long-term positive prospects of consolidating results from Samsung Bioepsis, we believe the acquisition price was a bit too high at more than 100% higher than Biogen's valuation multiples.


Samsung Biologics: Rights Offering of 3 Trillion Won to Acquire Remaining Stake in Samsung Bioepsis

Equity Capital Markets

Samsung Biologics   / Equity Capital Markets

<ul>
<li>Samsung Biologics announced that it would purchase all 10,341,852 shares of Samsung Bioepis owned by Biogen for ₩2.77T. For this, it also announced a ₩3T new share issuance.</li>
<li>The discount rate is 15%, tighter than the usual 20%. Despite that, this offering still deserves attention from an arb perspective as we may see more forfeited shares than expected.</li>
<li>Entry timing? I'll aim at the rights trading window. As a short hedge, I will look at C&amp;T, which is expected to have a higher price synch rate with Biologics.</li>
</ul>


Samsung Biologics announced that it would purchase all 10,341,852 shares of Samsung Bioepis owned by Biogen for ₩2.77T. For this, it also announced a ₩3T new share issuance.
The discount rate is 15%, tighter than the usual 20%. Despite that, this offering still deserves attention from an arb perspective as we may see more forfeited shares than expected.
Entry timing? I'll aim at the rights trading window. As a short hedge, I will look at C&amp;T, which is expected to have a higher price synch rate with Biologics.


Samsung Biologics Offering: Deal Summary & Trading Dynamics

South Korea

Samsung C&T Corporation conducts diversified business support services and resort operation activities. The Company offers a range of services in areas including clothing retail, construction, energy, real estate, food service, and resort accommodations. Samsung C&T also operates a resort with amusement rides, a zoo, water park, golf clubs, and restaurants.

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Samsung C&T (028260 KS)

FnGuide Samsung Group Index Rebalancing Preview

FnGuide Samsung Group Index has the largest AUM among the locally-themed indexes. This post previews the upcoming rebalancing in June.

Sanghyun Park

LG Energy's KOSPI 200 Float Is 15%: Weight Adjustment Trading for Other Constituents

KRX has bumped up LG Energy's float to 15%. As a result, we will see a more substantial passive impact on LG Energy. Also, we should see...

Sanghyun Park

StubWorld: SK Square And LG Chem's Unjustified NAV Discounts

Wide discounts in Korea are not uncommon. But SK Square has a strong parent/sub relationship. The holding in Hynix is worth 243% and 72% of SK...

David Blennerhassett

Samsung Biologics: Rights Offering of 3 Trillion Won to Acquire Remaining Stake in Samsung Bioepsis

Despite the long-term positive prospects of consolidating results from Samsung Bioepsis, we believe the acquisition price was a bit too high at...

Douglas Kim

Samsung Biologics Offering: Deal Summary & Trading Dynamics

Samsung Biologics announced that it would purchase all of Samsung Bioepis shares owned by Biogen. So, it also announced a ₩3T rights offering. This...

Sanghyun Park

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