Global Healthcare Analyst

Tina Banerjee

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/caregen-co-ltd" target="_blank" data-smartkarma-citation="entities:27337:1" rel="noopener">Caregen Co Ltd (214370 KS)</a> is a niche biotech company, with focus on biomimetic peptide-based cosmeceuticals and medical devices targeting anti-aging industry. The company has a large addressable market opportunity.  </li>
<li>Despite the negative impact from the re-spread of COVID-19, Caregen reported 4% y/y growth in total revenue in H1 2022, with operating profit margin expanding 260bps.</li>
<li>Caregen’s COVID-19 nasal spray is in phase 1 trial. FDA has registered Caregen’s health functional food to control blood sugar as a new dietary ingredient (NDI).</li>
</ul>



Caregen Co Ltd (214370 KS) is a niche biotech company, with focus on biomimetic peptide-based cosmeceuticals and medical devices targeting anti-aging industry. The company has a large addressable market opportunity.  
Despite the negative impact from the re-spread of COVID-19, Caregen reported 4% y/y growth in total revenue in H1 2022, with operating profit margin expanding 260bps.
Caregen’s COVID-19 nasal spray is in phase 1 trial. FDA has registered Caregen’s health functional food to control blood sugar as a new dietary ingredient (NDI).


Caregen (214370 KS): Business Recovery Backed by Strong Global Demand; New Products Brighten Outlook

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.

Event-Driven

<ul>
<li>KOSDAQ 150 will replace Osstem with Caregen at the close on March 16.</li>
<li>Even if we conservatively assume KOSPI 150's direct rebalancing trading funds at ₩1.5T, Caregen will likely face a passive inflow of 4.76x ADTV.</li>
<li>So, it seems appropriate to approach this event as a short-term momentum trading with a small volume on Caregen right before the inclusion effective date.</li>
</ul>


KOSDAQ 150 will replace Osstem with Caregen at the close on March 16.
Even if we conservatively assume KOSPI 150's direct rebalancing trading funds at ₩1.5T, Caregen will likely face a passive inflow of 4.76x ADTV.
So, it seems appropriate to approach this event as a short-term momentum trading with a small volume on Caregen right before the inclusion effective date.


KOSDAQ 150 Special Change: Momentum Trading on Caregen Right Before Inclusion

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

<ul>
<li>On 18 February, the KRX announced that the deletion of Osstem Implant (048260 KS) and the inclusion of Caregen Co Ltd (214370 KS) in KOSDAQ150.</li>
<li>The South Korean Presidential election will be held on 9 March and the KRX is not likely to make sensitive decisions such as the delisting of Osstem Implant in March.</li>
<li>We continue to like the pair trade (long KOSPI200 and short KOSDAQ150) which has worked out well in the past month and we expect continued gains on this trade.</li>
</ul>


On 18 February, the KRX announced that the deletion of Osstem Implant (048260 KS) and the inclusion of Caregen Co Ltd (214370 KS) in KOSDAQ150.
The South Korean Presidential election will be held on 9 March and the KRX is not likely to make sensitive decisions such as the delisting of Osstem Implant in March.
We continue to like the pair trade (long KOSPI200 and short KOSDAQ150) which has worked out well in the past month and we expect continued gains on this trade.


KOSDAQ150: Details of Osstem Implant Exclusion & Caregen Inclusion and Case Study of SillaJen

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

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Index Rebalance

<ul>
<li>Hang Seng announced the results of the March rebalance post market close Friday. Two adds for the HSI, one set of changes for HSCEI, three sets for HSTECH.</li>
<li>An ad hoc rebalance was announced for the KOSDAQ150 following Osstem being designated an 'Administrative Issue'. In IPO world, we have LIC in India and SBI Sumishin NetBank coming up.</li>
<li>Friday was the review cutoff date for the March rebalance of the ASX200 Index. The ATO has provided Aventus with the tax ruling and that creates a timing issue.</li>
</ul>


Hang Seng announced the results of the March rebalance post market close Friday. Two adds for the HSI, one set of changes for HSCEI, three sets for HSTECH.
An ad hoc rebalance was announced for the KOSDAQ150 following Osstem being designated an 'Administrative Issue'. In IPO world, we have LIC in India and SBI Sumishin NetBank coming up.
Friday was the review cutoff date for the March rebalance of the ASX200 Index. The ATO has provided Aventus with the tax ruling and that creates a timing issue.


Index Rebalance & ETF Flow Recap: HSI, HSCEI, HSTECH, HSCI, S&P/ASX, SET50, LIC, SBI Sumishin, Crown

<ul>
<li>
<a href="https://www.smartkarma.com/entities/osstem-implant-co-ltd" target="_blank" data-smartkarma-citation="entities:1450:1" rel="noopener">Osstem Implant (048260 KS)</a> has been suspended from trading this year following embezzlement that has nearly wiped out its equity capital.</li>
<li>The stock was named an Administrative Issue on Friday and will be deleted from the <a href="https://www.smartkarma.com/entities/kosdaq-150-index" target="_blank" data-smartkarma-citation="entities:31077:1" rel="noopener">KOSDAQ 150 Index (KOSDQ150 INDEX)</a>. <a href="https://www.smartkarma.com/entities/caregen-co-ltd" target="_blank" data-smartkarma-citation="entities:27337:1" rel="noopener">Caregen Co Ltd (214370 KS)</a> is the replacement.</li>
<li>Passive funds will need to sell around KRW 60bn of <a href="https://www.smartkarma.com/entities/osstem-implant-co-ltd" target="_blank" data-smartkarma-citation="entities:1450:1" rel="noopener">Osstem Implant (048260 KS)</a> if they can, and buy KRW 7bn of <a href="https://www.smartkarma.com/entities/caregen-co-ltd" target="_blank" data-smartkarma-citation="entities:27337:1" rel="noopener">Caregen Co Ltd (214370 KS)</a>. </li>
</ul>



Osstem Implant (048260 KS) has been suspended from trading this year following embezzlement that has nearly wiped out its equity capital.
The stock was named an Administrative Issue on Friday and will be deleted from the KOSDAQ 150 Index (KOSDQ150 INDEX). Caregen Co Ltd (214370 KS) is the replacement.
Passive funds will need to sell around KRW 60bn of Osstem Implant (048260 KS) if they can, and buy KRW 7bn of Caregen Co Ltd (214370 KS). 


KOSDAQ150 Ad Hoc Index Rebalance: Osstem Implant OUT; Caregen IN

South Korea

Caregen Co., Ltd. manufactures medical equipment based on their research on Growth Factors and purified Biomimetic Peptides.  The Company's products include Dermaheal and Renokin.

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Caregen Co Ltd (214370 KS)

Caregen (214370 KS): Business Recovery Backed by Strong Global Demand; New Products Brighten Outlook

Caregen is seeing stable revenue from existing cosmeceutical and professional therapy products, driven by strong global demand. The company is...

Tina Banerjee

KOSDAQ 150 Special Change: Momentum Trading on Caregen Right Before Inclusion

KOSDAQ 150 will implement the special change (Osstem Out and Caregen In) at the close on March 16, providing short-term momentum trading on Caregen...

Sanghyun Park

KOSDAQ150: Details of Osstem Implant Exclusion & Caregen Inclusion and Case Study of SillaJen

The South Korean Presidential election will be held on 9 March and the KRX is not likely to make sensitive decisions such as the delisting of...

Douglas Kim

Index Rebalance & ETF Flow Recap: HSI, HSCEI, HSTECH, HSCI, S&P/ASX, SET50, LIC, SBI Sumishin, Crown

This recap highlights Insights covering Asian index rebalances (announcements/ forecasts/ IPO Fast Entry/ M&A driven changes). We also highlight...

Brian Freitas

KOSDAQ150 Ad Hoc Index Rebalance: Osstem Implant OUT; Caregen IN

Osstem Implant will be deleted from the KOSDAQ150 Index at some point over the next 15 trading days and replaced with Caregen. Passive ETFs and...

Brian Freitas

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