Global Healthcare Analyst

Tina Banerjee

Thematic (Sector/Industry)

<ul>
<li>Daiichi Sankyo has announced that Dato-DXd has been recommended for approval in EU. Astellas Pharma has submitted new drug application for conditional approval of Izervay for Geographic Atrophy in Japan.</li>
<li>SanBio has successfully secured the planned production yield for the second commercial production run to meet the approval conditions for the shipment of Akuugo suspension for intracranial implantation.</li>
<li>IHH Healthcare is seeking compensation of INR109.3B from Daiichi Sankyo for its stake buy in Fortis Healthcare. Dr. Reddy’s Laboratories entered licensing agreement with Shanghai Henlius Biotech for Darzalex biosimilar.</li>
</ul>


Daiichi Sankyo has announced that Dato-DXd has been recommended for approval in EU. Astellas Pharma has submitted new drug application for conditional approval of Izervay for Geographic Atrophy in Japan.
SanBio has successfully secured the planned production yield for the second commercial production run to meet the approval conditions for the shipment of Akuugo suspension for intracranial implantation.
IHH Healthcare is seeking compensation of INR109.3B from Daiichi Sankyo for its stake buy in Fortis Healthcare. Dr. Reddy’s Laboratories entered licensing agreement with Shanghai Henlius Biotech for Darzalex biosimilar.


APAC Healthcare Weekly (Feb 9)- Daiichi Sankyo, Astellas, SanBio, IHH, Henlius Biotech, Dr. Reddy’s

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>With 2 trading days left in the review period, there could be 30 adds/deletes across the S&amp;P/ASX family of indices in September.</li>
<li>Passive trackers will need to trade a lot of stock in the forecast changes, with the impact being especially large for the changes to the <a href="https://www.smartkarma.com/entities/s-p-asx-200" target="_blank" data-smartkarma-citation="entities:22901:1" rel="noopener">S&amp;P/ASX 200</a> and S&amp;P/ASX 300.</li>
<li>The forecast adds have hugely outperformed the forecast deletes. Borrow recall on the deletes and increased borrow availability on the adds could result in underperformance following announcement of the changes.</li>
</ul>


With 2 trading days left in the review period, there could be 30 adds/deletes across the S&amp;P/ASX family of indices in September.
Passive trackers will need to trade a lot of stock in the forecast changes, with the impact being especially large for the changes to the S&amp;P/ASX 200 and S&amp;P/ASX 300.
The forecast adds have hugely outperformed the forecast deletes. Borrow recall on the deletes and increased borrow availability on the adds could result in underperformance following announcement of the changes.


S&P/​​​​​​​​​ASX Index Rebalance Preview: Review Period Nearly Done; Big Impact Changes

<ul>
<li>With nearly 80% of the review period complete, there could be 28 adds/deletes across the S&amp;P/ASX family of indices in September.</li>
<li>There is a lot of stocks for passive trackers to trade on the index changes with the largest impacts on the potential changes to the <a href="https://www.smartkarma.com/entities/s-p-asx-200" target="_blank" data-smartkarma-citation="entities:22901:1" rel="noopener">S&amp;P/ASX 200 (AS51 INDEX)</a>. </li>
<li>The potential adds have outperformed the potential deletions by a LOT over the last few months and continued positioning could lead to further gains.</li>
</ul>


With nearly 80% of the review period complete, there could be 28 adds/deletes across the S&amp;P/ASX family of indices in September.
There is a lot of stocks for passive trackers to trade on the index changes with the largest impacts on the potential changes to the S&amp;P/ASX 200 (AS51 INDEX). 
The potential adds have outperformed the potential deletions by a LOT over the last few months and continued positioning could lead to further gains.


S&P/​​​​​​​​​ASX Index Rebalance Preview: Potential Changes from Now to September

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/cochlear-ltd" target="_blank" data-smartkarma-citation="entities:918:1" rel="noopener">Cochlear Ltd (COH AU)</a> shares rallied 30%+ over the last six months. Shares are trading at NTM P/E of 51.3x, versus other Australia-listed medical devices companies’ P/E of 23–32x.</li>
<li>The underlying business strength depicted by strong financial performance and guidance raise, and superior product offerings justify the pricey valuation.</li>
<li>Cochlear lifted FY24 net profit guidance to A$385–400M (+26–31% YoY) from A$355–375M. The company expects FY24 cochlear implant volume growth of 10–15% YoY.</li>
</ul>



Cochlear Ltd (COH AU) shares rallied 30%+ over the last six months. Shares are trading at NTM P/E of 51.3x, versus other Australia-listed medical devices companies’ P/E of 23–32x.
The underlying business strength depicted by strong financial performance and guidance raise, and superior product offerings justify the pricey valuation.
Cochlear lifted FY24 net profit guidance to A$385–400M (+26–31% YoY) from A$355–375M. The company expects FY24 cochlear implant volume growth of 10–15% YoY.


Cochlear Ltd (COH AU): Underlying Business Strength Justifies Superior Valuation

<ul>
<li>The review period for the March rebalance of the MVIS Australia Equal Weight Index ends on 29 February with results announced on 8 March and implemented on 15 March.</li>
<li>
<a href="https://www.smartkarma.com/entities/lendlease-group" target="_blank" data-smartkarma-citation="entities:11248:1" rel="noopener">Lendlease Group (LLC AU)</a>, <a href="https://www.smartkarma.com/entities/idp-education-ltd" target="_blank" data-smartkarma-citation="entities:1098:1" rel="noopener">IDP Education (IEL AU)</a> and <a href="https://www.smartkarma.com/entities/igo-ltd" target="_blank" data-smartkarma-citation="entities:462:1" rel="noopener">IGO Ltd (IGO AU)</a> are very close to deletion zone and price moves over the next couple of weeks are important.</li>
<li>
<a href="https://www.smartkarma.com/entities/igo-ltd" target="_blank" data-smartkarma-citation="entities:462:1" rel="noopener">IGO Ltd (IGO AU)</a> is also a deletion from a global index in February and a lower stock price could lead to deletion from this index too.</li>
</ul>


The review period for the March rebalance of the MVIS Australia Equal Weight Index ends on 29 February with results announced on 8 March and implemented on 15 March.

Lendlease Group (LLC AU), IDP Education (IEL AU) and IGO Ltd (IGO AU) are very close to deletion zone and price moves over the next couple of weeks are important.

IGO Ltd (IGO AU) is also a deletion from a global index in February and a lower stock price could lead to deletion from this index too.


MVIS Australia Equal Weight Index Rebalance Preview: Should I Stay or Should IGO?

Australia

Cochlear Limited researches, develops and markets cochlear implant systems for hearing impaired individuals.  The Company's hearing implant systems include Nucleus and Baha and are sold both domestically and internationally.

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Cochlear Ltd (COH AU)

APAC Healthcare Weekly (Feb 9)- Daiichi Sankyo, Astellas, SanBio, IHH, Henlius Biotech, Dr. Reddy’s

APAC healthcare companies continued to get approvals for new products and initiates clinical trials. The companies continued with acquisitions and...

Tina Banerjee

S&P/ASX Index Rebalance Preview: Review Period Nearly Done; Big Impact Changes

There could be 30 changes for the ASX indices in September with a lot to trade for passive trackers. The adds have outperformed the deletes and...

Brian Freitas

S&P/ASX Index Rebalance Preview: Potential Changes from Now to September

There could be 28 changes for the ASX indices in September with a lot to trade for passive trackers. The adds have outperformed the deletes by a...

Brian Freitas