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

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Event-Driven

<p>The Indonesia Stock Exchange (IDX) has announced a change in the <a href="https://www.smartkarma.com/entities/jakarta-stock-exchange-composite-index" target="_blank" data-smartkarma-citation="entities:22914:1" rel="noopener">Jakarta Stock Exchange Composite Index (JCI INDEX)</a> calculation methodology to make it a free float market cap weighted index from a full market cap weighted index. Additionally, there will be a 9% capping on the weight of a single stock in the index.</p><p>The change will take place in a phased manner in 3 stages: at the beginning of October 2020, January 2021 and April 2021.</p><p>The biggest beneficiaries of the change are expected to be <a href="https://www.smartkarma.com/entities/telekomunikasi-indonesia" target="_blank" data-smartkarma-citation="entities:1051:1" rel="noopener">Telekomunikasi Indonesia (TLKM IJ)</a>, <a href="https://www.smartkarma.com/entities/bank-rakyat-indonesia-persero" target="_blank" data-smartkarma-citation="entities:484:1" rel="noopener">Bank Rakyat Indonesia Persero (BBRI IJ)</a>, <a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a>, <a href="https://www.smartkarma.com/entities/bank-mandiri-persero-tbk-pt" target="_blank" data-smartkarma-citation="entities:441:1" rel="noopener">Bank Mandiri Persero (BMRI IJ)</a>, <a href="https://www.smartkarma.com/entities/merdeka-copper-gold-tbk-pt" target="_blank" data-smartkarma-citation="entities:28447:1" rel="noopener">Merdeka Copper Gold Tbk PT (MDKA IJ)</a>, <a href="https://www.smartkarma.com/entities/charoen-pokphand-indonesi-pt" target="_blank" data-smartkarma-citation="entities:10889:1" rel="noopener">Charoen Pokphand Indonesi (CPIN IJ)</a>, <a href="https://www.smartkarma.com/entities/semen-indonesia-persero-tbk" target="_blank" data-smartkarma-citation="entities:11161:1" rel="noopener">Semen Indonesia (Gresik) (SMGR IJ)</a>, <a href="https://www.smartkarma.com/entities/sarana-menara-nusantara-pt" target="_blank" data-smartkarma-citation="entities:6848:1" rel="noopener">Sarana Menara Nusantara (TOWR IJ)</a>, <a href="https://www.smartkarma.com/entities/indofood-sukses-makmur-tbk-p" target="_blank" data-smartkarma-citation="entities:1053:1" rel="noopener">Indofood Sukses Makmur Tbk P (INDF IJ)</a> and <a href="https://www.smartkarma.com/entities/bank-negara-indonesia-persero" target="_blank" data-smartkarma-citation="entities:8285:1" rel="noopener">Bank Negara Indonesia Persero (BBNI IJ)</a>.</p><p>The biggest falls in index weight are expected on <a href="https://www.smartkarma.com/entities/bank-central-asia-tbk-pt" target="_blank" data-smartkarma-citation="entities:440:1" rel="noopener">Bank Central Asia (BBCA IJ)</a>, <a href="https://www.smartkarma.com/entities/hm-sampoerna-tbk-pt" target="_blank" data-smartkarma-citation="entities:617:1" rel="noopener">HM Sampoerna (HMSP IJ)</a>, <a href="https://www.smartkarma.com/entities/unilever-indonesia-tbk-pt" target="_blank" data-smartkarma-citation="entities:231:1" rel="noopener">Unilever Indonesia (UNVR IJ)</a>, <a href="https://www.smartkarma.com/entities/chandra-asri-petrochemical" target="_blank" data-smartkarma-citation="entities:2556:1" rel="noopener">Chandra Asri Petrochemical (TPIA IJ)</a>, <a href="https://www.smartkarma.com/entities/bank-permata-tbk-pt" target="_blank" data-smartkarma-citation="entities:728:1" rel="noopener">Bank Permata (BNLI IJ)</a>, <a href="https://www.smartkarma.com/entities/bank-brisyariah-tbk-pt" target="_blank" data-smartkarma-citation="entities:26981:1" rel="noopener">Bank Brisyariah (BRIS IJ)</a>, <a href="https://www.smartkarma.com/entities/elang-mahkota-teknologi-tbk" target="_blank" data-smartkarma-citation="entities:7752:1" rel="noopener">Emtek (EMTK IJ)</a>, <a href="https://www.smartkarma.com/entities/bayan-resources-group" target="_blank" data-smartkarma-citation="entities:8039:1" rel="noopener">Bayan Resources (BYAN IJ)</a> and <a href="https://www.smartkarma.com/entities/bank-jago-tbk-pt" target="_blank" data-smartkarma-citation="entities:31094:1" rel="noopener">Bank Jago Tbk PT (ARTO IJ)</a>.</p><p>Among the upweights, there could be over 2 days of ADV to trade on <a href="https://www.smartkarma.com/entities/charoen-pokphand-indonesi-pt" target="_blank" data-smartkarma-citation="entities:10889:1" rel="noopener">Charoen Pokphand Indonesi (CPIN IJ)</a> and <a href="https://www.smartkarma.com/entities/semen-indonesia-persero-tbk" target="_blank" data-smartkarma-citation="entities:11161:1" rel="noopener">Semen Indonesia (Gresik) (SMGR IJ)</a> while there could be over 1 day of ADV to trade on <a href="https://www.smartkarma.com/entities/telekomunikasi-indonesia" target="_blank" data-smartkarma-citation="entities:1051:1" rel="noopener">Telekomunikasi Indonesia (TLKM IJ)</a>, <a href="https://www.smartkarma.com/entities/indofood-sukses-makmur-tbk-p" target="_blank" data-smartkarma-citation="entities:1053:1" rel="noopener">Indofood Sukses Makmur Tbk P (INDF IJ)</a>, <a href="https://www.smartkarma.com/entities/sarana-menara-nusantara-pt" target="_blank" data-smartkarma-citation="entities:6848:1" rel="noopener">Sarana Menara Nusantara (TOWR IJ)</a> and <a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a>.</p><p><a href="https://www.smartkarma.com/entities/hm-sampoerna-tbk-pt" target="_blank" data-smartkarma-citation="entities:617:1" rel="noopener">HM Sampoerna (HMSP IJ)</a>, <a href="https://www.smartkarma.com/entities/chandra-asri-petrochemical" target="_blank" data-smartkarma-citation="entities:2556:1" rel="noopener">Chandra Asri Petrochemical (TPIA IJ)</a> and <a href="https://www.smartkarma.com/entities/unilever-indonesia-tbk-pt" target="_blank" data-smartkarma-citation="entities:231:1" rel="noopener">Unilever Indonesia (UNVR IJ)</a> would be the most impacted stocks with potential outflows.</p>

The Indonesia Stock Exchange (IDX) has announced a change in the Jakarta Stock Exchange Composite Index (JCI INDEX) calculation methodology to make it a free float market cap weighted index from a full market cap weighted index. Additionally, there will be a 9% capping on the weight of a single stock in the index.The change will take place in a phased manner in 3 stages: at the beginning of October 2020, January 2021 and April 2021.The biggest beneficiaries of the change are expected to be Telekomunikasi Indonesia (TLKM IJ), Bank Rakyat Indonesia Persero (BBRI IJ), Astra International (ASII IJ), Bank Mandiri Persero (BMRI IJ), Merdeka Copper Gold Tbk PT (MDKA IJ), Charoen Pokphand Indonesi (CPIN IJ), Semen Indonesia (Gresik) (SMGR IJ), Sarana Menara Nusantara (TOWR IJ), Indofood Sukses Makmur Tbk P (INDF IJ) and Bank Negara Indonesia Persero (BBNI IJ).The biggest falls in index weight are expected on Bank Central Asia (BBCA IJ), HM Sampoerna (HMSP IJ), Unilever Indonesia (UNVR IJ), Chandra Asri Petrochemical (TPIA IJ), Bank Permata (BNLI IJ), Bank Brisyariah (BRIS IJ), Emtek (EMTK IJ), Bayan Resources (BYAN IJ) and Bank Jago Tbk PT (ARTO IJ).Among the upweights, there could be over 2 days of ADV to trade on Charoen Pokphand Indonesi (CPIN IJ) and Semen Indonesia (Gresik) (SMGR IJ) while there could be over 1 day of ADV to trade on Telekomunikasi Indonesia (TLKM IJ), Indofood Sukses Makmur Tbk P (INDF IJ), Sarana Menara Nusantara (TOWR IJ) and Astra International (ASII IJ).HM Sampoerna (HMSP IJ), Chandra Asri Petrochemical (TPIA IJ) and Unilever Indonesia (UNVR IJ) would be the most impacted stocks with potential outflows.

Jakarta Composite Index: Impact of Change to Capped Free Float Weighting

ASEAN Insight Provider, CrossASEAN Research

Angus Mackintosh

ASEAN Insight Provider

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

Equity Bottom-Up

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<p><a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a> released a reassuring set of 1Q2021 results this week, which were lower than last year but also reflect the company's resilience and represent some cause for optimism coupled with some interesting acquisitions in the digital space.</p>
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<p>The company saw its headline sales fall -4% YoY in 1Q2021 while net income fell by -22% YoY to IDR3,728bn. These numbers are against a high base last year since the pandemic only started to impact Indonesia in March 2020.</p>
<p>Car sales in 1Q2021 were down -24% YoY and motorcycle sales were down -17% YoY but there was a strong recovery in March of +70% MoM as luxury tax was cut.</p>
<p>Subsidiary <a href="https://www.smartkarma.com/entities/united-tractors-tbk-pt" target="_blank" data-smartkarma-citation="entities:698:1" rel="noopener">United Tractors (UNTR IJ)</a> saw higher Komatsu heavy equipment sales but this was partially offset by lower mining contracting volumes.</p>
<p>The company's plantation business under <a href="https://www.smartkarma.com/entities/astra-agro-lestari-tbk-pt" target="_blank" data-smartkarma-citation="entities:4050:1" rel="noopener">Astra Agro Lestari (AALI IJ)</a>saw a negative impact from lower crude palm oil prices. </p>
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<section class="figure">The above numbers were achieved with the backdrop of an increasingly strong balance sheet and funding position, with net cash increasing to IDR15.9tn as at the end of 1Q2021.</section>
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<section class="figure">Management suggested that if trading performance continues to improve in the remainder of the year then both capital expenditure and working capital could increase.</section>
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<p><a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a>'s heavy equipment, mining, construction, and energy division saw a +3% increase in net profit to IDR1.1tn, with 59.5%-owned <a href="https://www.smartkarma.com/entities/united-tractors-tbk-pt" target="_blank" data-smartkarma-citation="entities:698:1" rel="noopener">United Tractors (UNTR IJ)</a> benefiting from higher Komatsu heavy equipment sales and better gold and coal prices </p>
<p>In a move signaling a growing focus on building its digital pillar, <a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a>'s digital arm Astra Digital Internasional was the lead in the series C funding for Halodoc, one of Indonesia's largest health-tech start-ups. It also made an investment in groceries player Sayurbox.</p>
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<p><a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a> trades on 12.3x FY21E PER and 10.3x FY22E PER versus its 5-year average forward PER, which stands at 14x making it look very attractive at these levels.</p>
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Astra International (ASII IJ) released a reassuring set of 1Q2021 results this week, which were lower than last year but also reflect the company's resilience and represent some cause for optimism coupled with some interesting acquisitions in the digital space.

The company saw its headline sales fall -4% YoY in 1Q2021 while net income fell by -22% YoY to IDR3,728bn. These numbers are against a high base last year since the pandemic only started to impact Indonesia in March 2020.
Car sales in 1Q2021 were down -24% YoY and motorcycle sales were down -17% YoY but there was a strong recovery in March of +70% MoM as luxury tax was cut.
Subsidiary United Tractors (UNTR IJ) saw higher Komatsu heavy equipment sales but this was partially offset by lower mining contracting volumes.
The company's plantation business under Astra Agro Lestari (AALI IJ)saw a negative impact from lower crude palm oil prices. 



The above numbers were achieved with the backdrop of an increasingly strong balance sheet and funding position, with net cash increasing to IDR15.9tn as at the end of 1Q2021.








Management suggested that if trading performance continues to improve in the remainder of the year then both capital expenditure and working capital could increase.








Astra International (ASII IJ)'s heavy equipment, mining, construction, and energy division saw a +3% increase in net profit to IDR1.1tn, with 59.5%-owned United Tractors (UNTR IJ) benefiting from higher Komatsu heavy equipment sales and better gold and coal prices 
In a move signaling a growing focus on building its digital pillar, Astra International (ASII IJ)'s digital arm Astra Digital Internasional was the lead in the series C funding for Halodoc, one of Indonesia's largest health-tech start-ups. It also made an investment in groceries player Sayurbox.


Astra International (ASII IJ) trades on 12.3x FY21E PER and 10.3x FY22E PER versus its 5-year average forward PER, which stands at 14x making it look very attractive at these levels.



Astra International (ASII IJ) - Digitally Remastered in a Cyclical Recovery

<p><a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a> released its FY2020 results with an EPS decline of -53% before exceptional (gain on sale of <a href="https://www.smartkarma.com/entities/bank-permata-tbk-pt" target="_blank" data-smartkarma-citation="entities:728:1" rel="noopener">Bank Permata (BNLI IJ)</a> to <a href="https://www.smartkarma.com/entities/bangkok-bank-public-co-ltd" target="_blank" data-smartkarma-citation="entities:213:1" rel="noopener">Bangkok Bank Public (BBL TB))</a>. Including the one-off gain from the sale of the bank then profits were down -28%. </p>
<p>Car sales were down -50% in 2020 with <a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a> seeing a slight decline in market share, whilst motorcycle sales were -41% but with Astra Honda gaining market share. </p>
<p><a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a> saw a slight increase in loan loss provisions for its financial services business due to the impact of the pandemic. </p>
<p><a href="https://www.smartkarma.com/entities/united-tractors-tbk-pt" target="_blank" data-smartkarma-citation="entities:698:1" rel="noopener">United Tractors (UNTR IJ)</a> was impacted by lower coal prices impacting heavy equipment sales and mining contracting volumes. </p>
<p>Its agribusiness under <a href="https://www.smartkarma.com/entities/astra-agro-lestari-tbk-pt" target="_blank" data-smartkarma-citation="entities:4050:1" rel="noopener">Astra Agro Lestari (AALI IJ)</a> saw positive tailwinds from the higher crude palm oil price. </p>
<p>The company finished the period with a strong balance sheet and a strong funding position given it has booked the proceeds from the sale of <a href="https://www.smartkarma.com/entities/bank-permata-tbk-pt" target="_blank" data-smartkarma-citation="entities:728:1" rel="noopener">Bank Permata (BNLI IJ)</a>. This gives <a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a> the wherewithal to look for acquisition opportunities in the wake of the pandemic. </p>
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<p><a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a> is trading around 20% below the historical mean on a forward PER basis and could trade higher during a recovery. It continues to be one of our top picks to play the recovery in the Indonesian economy. </p>
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Astra International (ASII IJ) released its FY2020 results with an EPS decline of -53% before exceptional (gain on sale of Bank Permata (BNLI IJ) to Bangkok Bank Public (BBL TB)). Including the one-off gain from the sale of the bank then profits were down -28%. 
Car sales were down -50% in 2020 with Astra International (ASII IJ) seeing a slight decline in market share, whilst motorcycle sales were -41% but with Astra Honda gaining market share. 
Astra International (ASII IJ) saw a slight increase in loan loss provisions for its financial services business due to the impact of the pandemic. 
United Tractors (UNTR IJ) was impacted by lower coal prices impacting heavy equipment sales and mining contracting volumes. 
Its agribusiness under Astra Agro Lestari (AALI IJ) saw positive tailwinds from the higher crude palm oil price. 
The company finished the period with a strong balance sheet and a strong funding position given it has booked the proceeds from the sale of Bank Permata (BNLI IJ). This gives Astra International (ASII IJ) the wherewithal to look for acquisition opportunities in the wake of the pandemic. 

Astra International (ASII IJ) is trading around 20% below the historical mean on a forward PER basis and could trade higher during a recovery. It continues to be one of our top picks to play the recovery in the Indonesian economy. 


Astra International (ASII IJ) - Sitting in Pole Position

Private Capital Markets

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<p><a href="https://www.smartkarma.com/entities/gojek" target="_blank" data-smartkarma-citation="entities:25976:1" rel="noopener">Gojek (1379371D IJ)</a> has bought a further 18% stake in Indonesia's <a href="https://www.smartkarma.com/entities/bank-jago-tbk-pt" target="_blank" data-smartkarma-citation="entities:31094:1" rel="noopener">Bank Jago (ARTO IJ)</a> bringing its total state to 22.16%. The transaction was executed at 1.14x PBV and a significant discount to the last traded price.</p>
<p><a href="https://www.smartkarma.com/entities/bank-jago-tbk-pt" target="_blank" data-smartkarma-citation="entities:31094:1" rel="noopener">Bank Jago (ARTO IJ)</a> has a market capitalization of IDR42.3tn (US$2.9bn), which values Gojek's stake in the bank at IDR9.3tn (US$641m).</p>
<p>Gojek's Indonesia users will in the future be able to open a bank account with <a href="https://www.smartkarma.com/entities/bank-jago-tbk-pt" target="_blank" data-smartkarma-citation="entities:31094:1" rel="noopener">Bank Jago (ARTO IJ)</a> and manage their finances through the <a href="https://www.smartkarma.com/entities/gojek" target="_blank" data-smartkarma-citation="entities:25976:1" rel="noopener">Gojek (1379371D IJ)</a> App. </p>
<p>The <a href="https://www.smartkarma.com/entities/bank-jago-tbk-pt" target="_blank" data-smartkarma-citation="entities:31094:1" rel="noopener">Bank Jago (ARTO IJ)</a> deal marks an opportunity for <a href="https://www.smartkarma.com/entities/gojek" target="_blank" data-smartkarma-citation="entities:25976:1" rel="noopener">Gojek (1379371D IJ)</a> to capitalize on its vast user base, especially through GoPay, to offer customers digital banking products and other financial services.</p>
<p><a href="https://www.smartkarma.com/entities/bank-jago-tbk-pt" target="_blank" data-smartkarma-citation="entities:31094:1" rel="noopener">Bank Jago (ARTO IJ)</a> has already moved its focus to digital banking, targeting SMEs and retail customers. GoPay also recently received investment from <a href="https://www.smartkarma.com/entities/facebook-inc-a" target="_blank" data-smartkarma-citation="entities:665:1" rel="noopener">Facebook Inc A (FB US)</a> and <a href="https://www.smartkarma.com/entities/paypal-holdings-inc" target="_blank" data-smartkarma-citation="entities:4747:1" rel="noopener">Paypal Holdings (PYPL US)</a>, which also provides a strong backing and the potential for collaboration from two heavyweight foreign investors</p>
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<div>For <a href="https://www.smartkarma.com/entities/gojek" target="_blank" data-smartkarma-citation="entities:25976:1" rel="noopener">Gojek (1379371D IJ</a>, this will help it develop a process through which it can work with other banks, as well as providing customers with an increasing array of digital financial solutions.</div>
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<div>The deal also demonstrates that management is focused on building its competitive advantage in Indonesia rather than being sidelined any merger considerations with <a href="https://www.smartkarma.com/entities/grabtaxi-holdings-pte-ltd" target="_blank" data-smartkarma-citation="entities:26950:1" rel="noopener">Grab (0967655D SP),</a> which seems increasingly unlikely. </div>
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<p>Gojek is also seen to be on the path to profitability, with all its services generating positive margins on a product basis. <a href="https://www.smartkarma.com/entities/gojek" target="_blank" data-smartkarma-citation="entities:25976:1" rel="noopener">Gojek (1379371D IJ)</a> also recently received US$150m in new money from <a href="https://www.smartkarma.com/entities/telekomunikasi-indonesia" target="_blank" data-smartkarma-citation="entities:1051:1" rel="noopener">Telekomunikasi Indonesia (TLKM IJ),</a> which represented another heavyweight local shareholder on top of <a href="https://www.smartkarma.com/entities/astra-international-tbk-pt" target="_blank" data-smartkarma-citation="entities:46:1" rel="noopener">Astra International (ASII IJ)</a> and Djarum Group. </p>
<p>We look at the background of the <a href="https://www.smartkarma.com/entities/bank-jago-tbk-pt" target="_blank" data-smartkarma-citation="entities:31094:1" rel="noopener">Bank Jago (ARTO IJ)</a> management team below the fold, which seems well-suited to building this future collaboration.</p>
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Gojek (1379371D IJ) has bought a further 18% stake in Indonesia's Bank Jago (ARTO IJ) bringing its total state to 22.16%. The transaction was executed at 1.14x PBV and a significant discount to the last traded price.
Bank Jago (ARTO IJ) has a market capitalization of IDR42.3tn (US$2.9bn), which values Gojek's stake in the bank at IDR9.3tn (US$641m).
Gojek's Indonesia users will in the future be able to open a bank account with Bank Jago (ARTO IJ) and manage their finances through the Gojek (1379371D IJ) App. 
The Bank Jago (ARTO IJ) deal marks an opportunity for Gojek (1379371D IJ) to capitalize on its vast user base, especially through GoPay, to offer customers digital banking products and other financial services.
Bank Jago (ARTO IJ) has already moved its focus to digital banking, targeting SMEs and retail customers. GoPay also recently received investment from Facebook Inc A (FB US) and Paypal Holdings (PYPL US), which also provides a strong backing and the potential for collaboration from two heavyweight foreign investors

For Gojek (1379371D IJ, this will help it develop a process through which it can work with other banks, as well as providing customers with an increasing array of digital financial solutions.

The deal also demonstrates that management is focused on building its competitive advantage in Indonesia rather than being sidelined any merger considerations with Grab (0967655D SP), which seems increasingly unlikely. 



Gojek is also seen to be on the path to profitability, with all its services generating positive margins on a product basis. Gojek (1379371D IJ) also recently received US$150m in new money from Telekomunikasi Indonesia (TLKM IJ), which represented another heavyweight local shareholder on top of Astra International (ASII IJ) and Djarum Group. 
We look at the background of the Bank Jago (ARTO IJ) management team below the fold, which seems well-suited to building this future collaboration.











































Gojek (1379371D IJ) - Upping the Ante on Financial Services

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Jardine Matheson Southeast Asia / Event-Driven

Jardine Matheson Southeast Asia (JCNC SP)

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<p>Yesterday, MSCI <a href="https://www.smartkarma.com/insights/The%20changes%20will%20be%20effective%20after%20the%20close%20of%20trading%20on%2030%20November." target="_blank" rel="noopener">announced</a> its November 2020 Semi-Annual Index Review.  As widely anticipated, <a href="https://www.smartkarma.com/entities/jardine-cycle-carriage-ltd" target="_blank" data-smartkarma-citation="entities:347:1" rel="noopener">Jardine Cycle &amp; Carriage (JCNC SP)</a> and <a href="https://www.smartkarma.com/entities/yangzijiang-shipbuilding-holdings-limited" target="_blank" data-smartkarma-citation="entities:660:1" rel="noopener">Yangzijiang Shipbuilding (YZJSGD SP)</a> are shown the exit, reducing the number of index constituents to 19. The changes will be effective after the close of trading on 30 November.</p>
<p>In <em><a href="https://skr.ma/N64Lw" target="_blank" rel="noopener">MSCI Singapore Index Rebalance Nov20: Shrinking Number of Constituents</a></em>, <a href="https://www.smartkarma.com/profiles/brian-freitas" target="_blank" data-smartkarma-citation="accounts:4091" rel="noopener">Brian Freitas</a> reckons 8.9 days of ADV to sell of JCNC from passive funds. JCNC is down ~3% today as I type, against +3% for ASII.</p>
<p>I see JCNC's discount to NAV at ~36% against a 12-month average of ~17%, having recently moved off its all-time low of ~38%.</p>
<p>As JCNC is all-but a proxy into Astra, this appears a straight-forward mean reversion play. </p>
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<p>More below the fold.</p>


Yesterday, MSCI announced its November 2020 Semi-Annual Index Review.  As widely anticipated, Jardine Cycle &amp; Carriage (JCNC SP) and Yangzijiang Shipbuilding (YZJSGD SP) are shown the exit, reducing the number of index constituents to 19. The changes will be effective after the close of trading on 30 November.
In MSCI Singapore Index Rebalance Nov20: Shrinking Number of Constituents, Brian Freitas reckons 8.9 days of ADV to sell of JCNC from passive funds. JCNC is down ~3% today as I type, against +3% for ASII.
I see JCNC's discount to NAV at ~36% against a 12-month average of ~17%, having recently moved off its all-time low of ~38%.
As JCNC is all-but a proxy into Astra, this appears a straight-forward mean reversion play. 

More below the fold.

Jardine Cycle & Carriage: "Buy The Fact" On MSCI Deletion

Indonesia

PT Bank Permata Tbk is a leading Indonesian commercial bank offering a comprehensive range of financial services, including retail and corporate banking products such as savings accounts, loans, credit cards, investments, and digital banking platforms. The bank provides solutions in conventional and Sharia-compliant formats, encompassing consumer banking, commercial banking, and wholesale banking segments. Headquartered in Jakarta, Indonesia, the company was founded in 1954.

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Bank Permata (BNLI IJ)

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As Jardine Cycle & Carriage (JCNC SP) is all-but a proxy into Astra International (ASII IJ), this appears a straight-forward mean reversion play.

David Blennerhassett

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