Index Rebal Trades & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal Trades & Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Index Rebalance

<ul>
<li>In this insight, we take a look at the potential index changes for F100 and F250 in the run-up to the March 2024 index rebal event.</li>
<li>I see one change for the F100 index and two other changes for the F250 index. There could be more as there are many names close to the border.</li>
<li>There are also a couple of potential intra-review changes expected in the next few weeks for <a href="https://www.smartkarma.com/entities/lxi-reit-plc" target="_blank" data-smartkarma-citation="entities:40684:1" rel="noopener">LXI REIT (LXI LN)</a> and <a href="https://www.smartkarma.com/entities/network-international-holdings-plc" target="_blank" data-smartkarma-citation="entities:28918:1" rel="noopener">Network International Holdings (NETW LN)</a> </li>
</ul>


In this insight, we take a look at the potential index changes for F100 and F250 in the run-up to the March 2024 index rebal event.
I see one change for the F100 index and two other changes for the F250 index. There could be more as there are many names close to the border.
There are also a couple of potential intra-review changes expected in the next few weeks for LXI REIT (LXI LN) and Network International Holdings (NETW LN) 


Quiddity Leaderboard F100/​​​250 Mar 24: One More Day to Base Date. Lots of Possibilities!

Founder & Managing Director, AIR Control Tower, AIR Control Tower

Neil Glynn

Founder & Managing Director, AIR Control Tower

AIR Control Tower

AIR Control Tower is an independent research and analysis platform. Its mission is to provide impactful insight and analysis across the global airline industry at a company and market level via detailed financial models to aid decision making for key stake holders at a time when risks have seldom, if ever, been higher and the global sector grapples with the imperative of funding de-carbonisation. Unique analysis forecasting global carrier-level earnings/cash flows, and restructuring/de-leveraging prospects, is designed to dynamically assess the health of the industry, predict surprises and identify potential requirements for third party support.

Insights on the global airline industry

Equity Bottom-Up

<ul>
<li>EasyJet reported a strong 1Q24 (to December 2023) result, outperforming expectations, while issuing positive guidance on pricing prospects for the rest of winter and summer.</li>
<li>Pricing for the rest of winter appears benign, but easyJet highlights summer pricing is "well ahead yoy", calming concerns that pricing strength will roll over.</li>
<li>Winter losses remain very difficult to manage, with easyJet likely to see a £3-4 per seat drag on pre-pandemic winter EBITDAR generation. Future opportunity and risk.</li>
</ul>


EasyJet reported a strong 1Q24 (to December 2023) result, outperforming expectations, while issuing positive guidance on pricing prospects for the rest of winter and summer.
Pricing for the rest of winter appears benign, but easyJet highlights summer pricing is "well ahead yoy", calming concerns that pricing strength will roll over.
Winter losses remain very difficult to manage, with easyJet likely to see a £3-4 per seat drag on pre-pandemic winter EBITDAR generation. Future opportunity and risk.


EasyJet - On Track for >£600m PBT in FY24 and Another Record Summer

<ul>
<li>The SE600 index is one of the most widely followed benchmark indices in Europe. This index is rebalanced on a quarterly basis.</li>
<li>In this insight, we take a look at the potential index changes that could take place between now and the end of the March 2024 index rebal event.</li>
<li>Based on the latest available data, I expect there to be up to seven index changes in the first quarter of 2024.</li>
</ul>


The SE600 index is one of the most widely followed benchmark indices in Europe. This index is rebalanced on a quarterly basis.
In this insight, we take a look at the potential index changes that could take place between now and the end of the March 2024 index rebal event.
Based on the latest available data, I expect there to be up to seven index changes in the first quarter of 2024.


Quiddity Leaderboard SE600 Mar 24: Two Intra-Review and 5 Regular Changes Likely

<ul>
<li>In this insight, we take a look at the potential index changes for F100 and F250 in the run-up to the March 2024 index rebal event.</li>
<li>Although I do not see any regular ADDs/DELs for the March 2024 rebalance, there might be one or two intra-review changes during the first quarter of 2024. </li>
<li>These intra-review changes will be triggered by the completion of M&amp;A events and it is important to know which names are leading the race to become intra-review ADDs.</li>
</ul>


In this insight, we take a look at the potential index changes for F100 and F250 in the run-up to the March 2024 index rebal event.
Although I do not see any regular ADDs/DELs for the March 2024 rebalance, there might be one or two intra-review changes during the first quarter of 2024. 
These intra-review changes will be triggered by the completion of M&amp;A events and it is important to know which names are leading the race to become intra-review ADDs.


Quiddity Leaderboard F100/​​​250 Mar 24: Intra-Review Replacements for NETW and LXI REIT

<ul>
<li>​Early three-month and six-month fare levels largely remain above prior year for the full service carriers (FSCs) and low cost carriers (LCCs)</li>
<li>EasyJet’s 2024 PBT can reach £600m, Ryanair FY25 net income can near-€2.5bn following €2.0bn in FY24, while Wizz Air can exceed €500m net income in FY25.</li>
<li>Wizz has the strongest potential to demonstrate its ability to improve EBITDAR/ASK by managing capacity, which may provide insight into future prospects as operations normalize/developmental routes mature.</li>
</ul>


​Early three-month and six-month fare levels largely remain above prior year for the full service carriers (FSCs) and low cost carriers (LCCs)
EasyJet’s 2024 PBT can reach £600m, Ryanair FY25 net income can near-€2.5bn following €2.0bn in FY24, while Wizz Air can exceed €500m net income in FY25.
Wizz has the strongest potential to demonstrate its ability to improve EBITDAR/ASK by managing capacity, which may provide insight into future prospects as operations normalize/developmental routes mature.


European Airlines - LCCs Unlikely to Pass Through Fuel Tailwinds in 2024

United Kingdom

easyJet plc, a low-cost passenger airline, conducts operations throughout the United Kingdom and mainland Europe.  The Company sells the majority of its tickets through its Web site.

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easyJet PLC (EZJ LN)

Quiddity Leaderboard F100/250 Mar 24: One More Day to Base Date. Lots of Possibilities!

There could be two slots for intra-review replacements in March 2024. Currently, Alfa Financial Software (ALFA LN) and Brunner Investment Trust...

Janaghan Jeyakumar, CFA

EasyJet - On Track for >£600m PBT in FY24 and Another Record Summer

easyJet provides early colour on forward pricing trends in Europe. Our detailed analysis suggests its PBT should exceed £600m in FY24.

Neil Glynn

Quiddity Leaderboard SE600 Mar 24: Two Intra-Review and 5 Regular Changes Likely

SE600 members CHR Hansen and LXI REIT could get deleted in the first quarter of 2024. Apart from that, I see five more possible index changes...

Janaghan Jeyakumar, CFA

Quiddity Leaderboard F100/250 Mar 24: Intra-Review Replacements for NETW and LXI REIT

F250 members Network International Holdings and LXI REIT could get deleted from the F250 index in 1Q 2024. The F250 potential ADDs leading the race...

Janaghan Jeyakumar, CFA

European Airlines - LCCs Unlikely to Pass Through Fuel Tailwinds in 2024

Deep dive on early 2024 pricing developments and the prospect of the major European low cost carriers retaining fuel price tailwinds in 2024

Neil Glynn

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Quiddity Leaderboard F100/​​​250 Mar 24: One More Day to Base Date. Lots of Possibilities!

There could be two slots for intra-review replacements in March 2024. Currently, Alfa Financial Software (ALFA LN) and Brunner Investment Trust...

Janaghan Jeyakumar, CFA

EasyJet - On Track for >£600m PBT in FY24 and Another Record Summer

easyJet provides early colour on forward pricing trends in Europe. Our detailed analysis suggests its PBT should exceed £600m in FY24.

Neil Glynn

Quiddity Leaderboard SE600 Mar 24: Two Intra-Review and 5 Regular Changes Likely

SE600 members CHR Hansen and LXI REIT could get deleted in the first quarter of 2024. Apart from that, I see five more possible index changes...

Janaghan Jeyakumar, CFA

Quiddity Leaderboard F100/​​​250 Mar 24: Intra-Review Replacements for NETW and LXI REIT

F250 members Network International Holdings and LXI REIT could get deleted from the F250 index in 1Q 2024. The F250 potential ADDs leading the race...

Janaghan Jeyakumar, CFA

European Airlines - LCCs Unlikely to Pass Through Fuel Tailwinds in 2024

Deep dive on early 2024 pricing developments and the prospect of the major European low cost carriers retaining fuel price tailwinds in 2024

Neil Glynn

Quiddity Leaderboard F100/250 Mar 24: One More Day to Base Date. Lots of Possibilities!

Quiddity Leaderboard F100/250 Mar 24: Intra-Review Replacements for NETW and LXI REIT