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

Index Rebalance

<ul>
<li>Following two periods of profitability, <a href="https://www.smartkarma.com/entities/innovent-biologics-inc" target="_blank" data-smartkarma-citation="entities:27452:1" rel="noopener">Innovent Biologics Inc (1801 HK)</a> will be added to the <a href="https://www.smartkarma.com/entities/hong-kong-hang-seng-index" target="_blank" data-smartkarma-citation="entities:22899:1" rel="noopener">Hang Seng Index (HSI INDEX)</a> at the close on 5 December.</li>
<li>
<a href="https://www.smartkarma.com/entities/innovent-biologics-inc" target="_blank" data-smartkarma-citation="entities:27452:1" rel="noopener">Innovent Biologics Inc (1801 HK)</a> is also an add to the <a href="https://www.smartkarma.com/entities/hang-seng-china-enterprises-index" target="_blank" data-smartkarma-citation="entities:22900:1" rel="noopener">Hang Seng China Enterprises Index (HSCEI INDEX)</a> in December, so this inclusion increases the flow and impact.</li>
<li>Estimated one-way turnover is 2.3% and the estimated round-trip trade is HK$9.2bn (US$1.2bn). Big capping outflows for <a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd-d7b798e2-202d-4e01-9a1e-799e2ae8f0c7" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba (9988 HK)</a> at the December rebalance.</li>
</ul>


Following two periods of profitability, Innovent Biologics Inc (1801 HK) will be added to the Hang Seng Index (HSI INDEX) at the close on 5 December.

Innovent Biologics Inc (1801 HK) is also an add to the Hang Seng China Enterprises Index (HSCEI INDEX) in December, so this inclusion increases the flow and impact.
Estimated one-way turnover is 2.3% and the estimated round-trip trade is HK$9.2bn (US$1.2bn). Big capping outflows for Alibaba (9988 HK) at the December rebalance.


Hang Seng Index (HSI) Rebalance: Innovent Biologics Turns a Profit, Gets Added

Overseas Chinese Equities, Aequitas Research

Ming Lu

Overseas Chinese Equities

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.

Equity Bottom-Up

<ul>
<li>Consumers accused that Alibaba and JD.com took national consumption subsidies.</li>
<li>Kuaishou’s new year sales GMV (Gross Merchandise Value) increased by 71%.</li>
<li>Honor Smartphone CEO resigned largely due to the IPO plan.</li>
</ul>


Consumers accused that Alibaba and JD.com took national consumption subsidies.
Kuaishou’s new year sales GMV (Gross Merchandise Value) increased by 71%.
Honor Smartphone CEO resigned largely due to the IPO plan.


China Consumption Weekly (27 Jan 2025): Alibaba, JD.com, Kuaishou, NIO, Honor, Apple

Ping An Healthcare and Technology / Index Rebalance

<ul>
<li>The review period for the December rebalance of the CSI Overseas China Internet Index ended 31 October. The changes should be announced 28 November and implemented close on 12 December.</li>
<li>There could be 6 inclusions for the <a href="https://www.smartkarma.com/entities/kraneshares-csi-china-internet-etf" target="_blank" data-smartkarma-citation="entities:28208:1" rel="noopener">KraneShares CSI China Internet ETF (KWEB US)</a> in December with most inclusions being high probability.</li>
<li>Impact on the inclusions varies between 1.3-5 days of ADV. There will be stocks with float increases and some capping changes.</li>
</ul>


The review period for the December rebalance of the CSI Overseas China Internet Index ended 31 October. The changes should be announced 28 November and implemented close on 12 December.
There could be 6 inclusions for the KraneShares CSI China Internet ETF (KWEB US) in December with most inclusions being high probability.
Impact on the inclusions varies between 1.3-5 days of ADV. There will be stocks with float increases and some capping changes.


KWEB Index Rebalance Preview: Bunch of Potential Inclusions in December

<ul>
<li>Alibaba’s Freshippo remained profitable and double-digit growth in the past nine months.</li>
<li>Brazil labor authorities are investigating BYD’s construction site for “slave-like condition”.</li>
<li>Tencent Music will compensate MCSC (Music Copyright Society of China) for the unauthorized usage of music copy rights.</li>
</ul>


Alibaba’s Freshippo remained profitable and double-digit growth in the past nine months.
Brazil labor authorities are investigating BYD’s construction site for “slave-like condition”.
Tencent Music will compensate MCSC (Music Copyright Society of China) for the unauthorized usage of music copy rights.


China Consumption Weekly (6 Jan 2025): Alibaba, BYD, Tencent Music, JD.com, Mixue

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Mandarin Oriental International / Event-Driven

<ul>
<li>A sale - partial or otherwise - of <a href="https://www.smartkarma.com/entities/mandarin-oriental-international-ltd" target="_blank" data-smartkarma-citation="entities:4773:1" rel="noopener">Mandarin Oriental International (MAND SP)</a>'s One Causeway Bay (OCB) was always on the cards. But I didn't see an Offer coming. </li>
<li>Concurrent with the sale of 13 floors of OCB to <a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd-d7b798e2-202d-4e01-9a1e-799e2ae8f0c7" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba (9988 HK)</a>, <a href="https://www.smartkarma.com/entities/jardine-matheson-holdings-ltd" target="_blank" data-smartkarma-citation="entities:19718:1" rel="noopener">Jardine Matheson (JM SP)</a> is seeking to take out MAND's minorities at US$3.35/share by way of a Scheme.</li>
<li>That's a 52.3% premium to undisturbed, and a 53.7% premium to NAV. Unlike the 2021 <a href="https://www.smartkarma.com/entities/jardine-strategic-holdings-ltd" target="_blank" data-smartkarma-citation="entities:15081:1" rel="noopener">Jardine Strategic (JS SP)</a> Offer, Matheson is required to abstain from voting on this takeover. </li>
</ul>


A sale - partial or otherwise - of Mandarin Oriental International (MAND SP)'s One Causeway Bay (OCB) was always on the cards. But I didn't see an Offer coming. 
Concurrent with the sale of 13 floors of OCB to Alibaba (9988 HK), Jardine Matheson (JM SP) is seeking to take out MAND's minorities at US$3.35/share by way of a Scheme.
That's a 52.3% premium to undisturbed, and a 53.7% premium to NAV. Unlike the 2021 Jardine Strategic (JS SP) Offer, Matheson is required to abstain from voting on this takeover. 


Mandarin Oriental (MAND SP): Matheson's Full Offer

China

Alibaba Group Holding Limited provides online sales services. The Company provides internet infrastructure, electronic commerce, online financial, and internet content services through its subsidiaries. Alibaba Group Holding offers its products and services worldwide.

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Alibaba (9988 HK)

Hang Seng Index (HSI) Rebalance: Innovent Biologics Turns a Profit, Gets Added

Innovent Bio is an add in Dec. Estimated one-way turnover is 2.3% and round-trip trade is HK$9.2bn. Innovent Bio has also been added to the HSCEI,...

Brian Freitas

China Consumption Weekly (27 Jan 2025): Alibaba, JD.com, Kuaishou, NIO, Honor, Apple

Consumers accused that Alibaba and JD.com took national consumption subsidies. Kuaishou’s new year sales GMV increased by 71%. Hornor Smartphone...

Ming Lu

KWEB Index Rebalance Preview: Bunch of Potential Inclusions in December

There could be 6 adds for the KWEB ETF in Dec, plus float increase for Healthyway and capping changes for the large stocks. CaoCao is newly...

Brian Freitas

China Consumption Weekly (6 Jan 2025): Alibaba, BYD, Tencent Music, JD.com, Mixue

Alibaba’s Freshippo remained profitable in the past nine months. Brazil authorities is investigating BYD’s “slave-like condition”. Tencent Music...

Ming Lu

Mandarin Oriental (MAND SP): Matheson's Full Offer

The Scheme Doc is out for MAND. The Court Meeting is the 8th December. As previously noted "the Mandarin Oriental Transaction Committee, which has...

David Blennerhassett

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