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

Event-Driven

<ul>
<li>The December rebalance of the HSI, HSCEI and HSTECH indices will use today's closing prices to cap the index constituents at 8%. This will lead to large flows.</li>
<li>The largest inflows will be on <a href="https://www.smartkarma.com/entities/alibaba-group" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba Group</a>, <a href="https://www.smartkarma.com/entities/haier-smart-home-co-ltd-b3ef445f-0f54-4586-8c58-9073de98d60e" target="_blank" data-smartkarma-citation="entities:31105:1" rel="noopener">Haier Smart Home</a>, <a href="https://www.smartkarma.com/entities/beijing-kuaishou-technology-co-ltd" target="_blank" data-smartkarma-citation="entities:29725:1" rel="noopener">Kuaishou Technology</a>, <a href="https://www.smartkarma.com/entities/li-auto-inc-3dbe6187-544f-40dd-b9f9-72fba9c0110e" target="_blank" data-smartkarma-citation="entities:33811:1" rel="noopener">Li Auto</a>, <a href="https://www.smartkarma.com/entities/petrochina-co-ltd-h" target="_blank" data-smartkarma-citation="entities:262:1" rel="noopener">PetroChina</a>, <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent</a>, <a href="https://www.smartkarma.com/entities/jd-com-inc" target="_blank" data-smartkarma-citation="entities:29043:1" rel="noopener">JD.com</a>, <a href="https://www.smartkarma.com/entities/china-resources-mixc-lifestyle-services" target="_blank" data-smartkarma-citation="entities:29285:1" rel="noopener">China Resources Mixc Lifestyle Services</a> and <a href="https://www.smartkarma.com/entities/tingyi-cayman-islands-holding-corp" target="_blank" data-smartkarma-citation="entities:14016:1" rel="noopener">Tingyi Holding</a>.</li>
<li>The largest outflows will be on <a href="https://www.smartkarma.com/entities/semiconductor-manufacturing-international-corp-smic" target="_blank" data-smartkarma-citation="entities:14231:1" rel="noopener">SMIC</a>, <a href="https://www.smartkarma.com/entities/netease" target="_blank" data-smartkarma-citation="entities:29030:1" rel="noopener">NetEase</a>, <a href="https://www.smartkarma.com/entities/aia-group-ltd" target="_blank" data-smartkarma-citation="entities:14895:1" rel="noopener">AIA Group</a>, <a href="https://www.smartkarma.com/entities/hsbc-holdings-plc" target="_blank" data-smartkarma-citation="entities:516:1" rel="noopener">HSBC Holdings</a>, <a href="https://www.smartkarma.com/entities/china-construction-bank-h" target="_blank" data-smartkarma-citation="entities:45:1" rel="noopener">China Construction Bank</a>, <a href="https://www.smartkarma.com/entities/alibaba-health-information-technology-ltd" target="_blank" data-smartkarma-citation="entities:453:1" rel="noopener">Alibaba Health Information Technology</a>, <a href="https://www.smartkarma.com/entities/innovent-biologics-inc" target="_blank" data-smartkarma-citation="entities:27452:1" rel="noopener">Innovent Biologics</a>, <a href="https://www.smartkarma.com/entities/china-mobile-ltd" target="_blank" data-smartkarma-citation="entities:27:1" rel="noopener">China Mobile</a>, <a href="https://www.smartkarma.com/entities/ping-an-insurance-grp-co-of-china-ltd" target="_blank" data-smartkarma-citation="entities:12880:1" rel="noopener">Ping An Insurance</a> and <a href="https://www.smartkarma.com/entities/industrial-and-commercial-bank-of-china-limited" target="_blank" data-smartkarma-citation="entities:1119:1" rel="noopener">ICBC</a>.</li>
</ul>


The December rebalance of the HSI, HSCEI and HSTECH indices will use today's closing prices to cap the index constituents at 8%. This will lead to large flows.
The largest inflows will be on Alibaba Group, Haier Smart Home, Kuaishou Technology, Li Auto, PetroChina, Tencent, JD.com, China Resources Mixc Lifestyle Services and Tingyi Holding.
The largest outflows will be on SMIC, NetEase, AIA Group, HSBC Holdings, China Construction Bank, Alibaba Health Information Technology, Innovent Biologics, China Mobile, Ping An Insurance and ICBC.


HSI, HSCEI, HSTECH: Rebalance Flows Post Capping (Dec 2022)

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>Hang Seng Index continues its march to 80 names, after which it will commence a march, or a slog, to 100 names in an effort to gain more comprehensive coverage</li>
<li>Doing so will admit names which move to Hong Kong from New York and will make way for more dynamism and lower SOE weights.</li>
<li>The three ADDs are <a href="https://www.smartkarma.com/entities/tingyi-cayman-islands-holding-corp" target="_blank" data-smartkarma-citation="entities:14016:1" rel="noopener">Tingyi Holding (322 HK)</a>, <a href="https://www.smartkarma.com/entities/china-resources-mixc-lifestyle-services" target="_blank" data-smartkarma-citation="entities:29285:1" rel="noopener">China Resources Mixc Lifestyle Services (1209 HK)</a>, and <a href="https://www.smartkarma.com/entities/haier-smart-home-co-ltd-b3ef445f-0f54-4586-8c58-9073de98d60e" target="_blank" data-smartkarma-citation="entities:31105:1" rel="noopener">Haier Smart Home Co Ltd (6690 HK)</a> with a pro-forma combined weight just &lt;1%.</li>
</ul>


Hang Seng Index continues its march to 80 names, after which it will commence a march, or a slog, to 100 names in an effort to gain more comprehensive coverage
Doing so will admit names which move to Hong Kong from New York and will make way for more dynamism and lower SOE weights.
The three ADDs are Tingyi Holding (322 HK), China Resources Mixc Lifestyle Services (1209 HK), and Haier Smart Home Co Ltd (6690 HK) with a pro-forma combined weight just &lt;1%.


Hang Seng Index Dec22 Rebal - 3 IN, None Out (The March to 80 Continues)

<ul>
<li>The inclusion of <a href="https://www.smartkarma.com/entities/tingyi-cayman-islands-holding-corp" target="_blank" data-smartkarma-citation="entities:14016:1" rel="noopener">Tingyi Holding (322 HK)</a>, <a href="https://www.smartkarma.com/entities/china-resources-mixc-lifestyle-services" target="_blank" data-smartkarma-citation="entities:29285:1" rel="noopener">China Resources Mixc Lifestyle Services (1209 HK)</a> and <a href="https://www.smartkarma.com/entities/haier-smart-home-co-ltd-b3ef445f-0f54-4586-8c58-9073de98d60e" target="_blank" data-smartkarma-citation="entities:31105:1" rel="noopener">Haier Smart Home Co Ltd (6690 HK)</a> gets us to 76 index constituents.</li>
<li>Changes to the stocks, number of shares, float and capping result in an estimated one-way turnover of 2.01% and will result in a one-way trade of HK$3,845m.</li>
<li>Shorts on <a href="https://www.smartkarma.com/entities/haier-smart-home-co-ltd-b3ef445f-0f54-4586-8c58-9073de98d60e" target="_blank" data-smartkarma-citation="entities:31105:1" rel="noopener">Haier Smart Home Co Ltd (6690 HK)</a> and <a href="https://www.smartkarma.com/entities/tingyi-cayman-islands-holding-corp" target="_blank" data-smartkarma-citation="entities:14016:1" rel="noopener">Tingyi Holding (322 HK)</a> are around 5% of float and covering could take the stocks higher.</li>
</ul>


The inclusion of Tingyi Holding (322 HK), China Resources Mixc Lifestyle Services (1209 HK) and Haier Smart Home Co Ltd (6690 HK) gets us to 76 index constituents.
Changes to the stocks, number of shares, float and capping result in an estimated one-way turnover of 2.01% and will result in a one-way trade of HK$3,845m.
Shorts on Haier Smart Home Co Ltd (6690 HK) and Tingyi Holding (322 HK) are around 5% of float and covering could take the stocks higher.


HSI Index Rebalance: Baby Steps; Double Inclusion for Haier Smart Home

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/jinke-smart-services-group-co" target="_blank" data-smartkarma-citation="entities:29214:1" rel="noopener">Jinke Smart Services (9666 HK)</a>’s VGO from Boyu Capital at HK$12.00 per share has been declared unconditional. Boyu has waived the 7.71% valid acceptances condition. </li>
<li>Boyu has likely two aims for the unusual VGO – secure anti-trust approval and a re-rating by becoming the largest shareholder. Anti-trust approval was received on 8 November.  </li>
<li>Acceptances of 0.0081% of outstanding shares reflect the unattractive offer. The final closing date is 22 November. At the last close price, the spread to the offer is 2.7%. </li>
</ul>



Jinke Smart Services (9666 HK)’s VGO from Boyu Capital at HK$12.00 per share has been declared unconditional. Boyu has waived the 7.71% valid acceptances condition. 
Boyu has likely two aims for the unusual VGO – secure anti-trust approval and a re-rating by becoming the largest shareholder. Anti-trust approval was received on 8 November.  
Acceptances of 0.0081% of outstanding shares reflect the unattractive offer. The final closing date is 22 November. At the last close price, the spread to the offer is 2.7%. 


<ul>
<li>
<a href="https://www.smartkarma.com/entities/jinke-smart-services-group-co" target="_blank" data-smartkarma-citation="entities:29214:1" rel="noopener">Jinke Smart Services (9666 HK)</a>’s VGO from Boyu Capital is now open at HK$12.00 per share. The first closing date is 14 November. The IFA says it's fair and reasonable. </li>
<li>The offer is conditional on 7.71% valid acceptances and anti-trust approval. The conditions can be waived. The offeror has not received irrevocables.</li>
<li>The offer is unattractive, but the low threshold and peer multiple derating suggest a high probability of success. At the current price, the spread to the offer is 3.4%. </li>
</ul>



Jinke Smart Services (9666 HK)’s VGO from Boyu Capital is now open at HK$12.00 per share. The first closing date is 14 November. The IFA says it's fair and reasonable. 
The offer is conditional on 7.71% valid acceptances and anti-trust approval. The conditions can be waived. The offeror has not received irrevocables.
The offer is unattractive, but the low threshold and peer multiple derating suggest a high probability of success. At the current price, the spread to the offer is 3.4%. 


Jinke Smart’s VGO from Boyu Capital: Open with First Close of 14 November

China

China Resources Mixc Lifestyle Services Limited offer property management services. The Company provides residential property management, community value added services, commercial operational services, commercial subleasing services, and other services. China Resources Mixc Lifestyle Services provides its services throughout Hong Kong.

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China Resources Mixc Lifestyle (1209 HK)

HSI, HSCEI, HSTECH: Rebalance Flows Post Capping (Dec 2022)

The December rebalance of the HSI, HSCEI, HSTECH indices will use today's close prices for capping. The one-way trade across all stocks across the...

Brian Freitas

Hang Seng Index Dec22 Rebal - 3 IN, None Out (The March to 80 Continues)

The Hang Seng rebalance for Dec 2022 adds 3 names which combined have a weight just under 1%. There are other capping changes but they are not...

Travis Lundy

HSI Index Rebalance: Baby Steps; Double Inclusion for Haier Smart Home

There are 3 adds to the HSI to get up to 76 members. Few adds are surprises & there is unlikely to be large positioning. Short interest on some...

Brian Freitas

Jinke Smart (9666 HK) VGO Unconditional

Boyu has waived the 7.71% valid acceptances condition. The final closing date is 22 November. At the last close price, the spread to the offer is...

Arun George

Jinke Smart’s VGO from Boyu Capital: Open with First Close of 14 November

The offer is unattractive, but the low acceptance threshold and peer multiple derating suggest a high probability of success. At the current price,...

Arun George

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