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>The rebalancing trade of the <strong>WISE Secondary Cell ETF</strong> will take place tomorrow, <strong>January 13 (Thursday), supposedly at the close</strong>.</li>
<li>Those names with a significant passive impact among the stocks with a daily trading amount of +US$10M are: <strong>SKIET +0.71x ADTV, POSCO Chemical +0.46x ADTV, &amp; SoulBrain: -0.69x ADTV </strong>
</li>
<li>
<strong>The most likely new addition is Enchem (348370)</strong> with <strong>a passive impact of 0.60x ADTV</strong>. So, I expect a significant level of price action tomorrow.</li>
</ul>


The rebalancing trade of the WISE Secondary Cell ETF will take place tomorrow, January 13 (Thursday), supposedly at the close.
Those names with a significant passive impact among the stocks with a daily trading amount of +US$10M are: SKIET +0.71x ADTV, POSCO Chemical +0.46x ADTV, &amp; SoulBrain: -0.69x ADTV 


The most likely new addition is Enchem (348370) with a passive impact of 0.60x ADTV. So, I expect a significant level of price action tomorrow.


TIGER Secondary Cell ETF Rebalancing Trading on January 13

<ul>
<li>There are six local sector indexes in total, which have a meaningful level of AUM and will be rebalanced in December.</li>
<li>In KOSPI200 IT, LG Corp and Samsung SDS will face a positive flow, while SDI will have an outflow on December 9. KB Financial will replace POSCO in FnGuide TOP10.</li>
<li>Samsung SDI, Enchem, and Dear U deserve the most attention the next day (the 10th). Besides Dear U, RBW is another likely addition to both K-Metaverse and Metaverse Theme.</li>
</ul>


There are six local sector indexes in total, which have a meaningful level of AUM and will be rebalanced in December.
In KOSPI200 IT, LG Corp and Samsung SDS will face a positive flow, while SDI will have an outflow on December 9. KB Financial will replace POSCO in FnGuide TOP10.
Samsung SDI, Enchem, and Dear U deserve the most attention the next day (the 10th). Besides Dear U, RBW is another likely addition to both K-Metaverse and Metaverse Theme.


Korea Sector Indexes with December Rebalancing: Passive Impact by Date

Index Rebalance

<ul>
<li>The rebalancing implementation of the FnGuide Secondary Battery Index will be on December 13. So, the ETF operator's rebalancing trading will take place at the close on December 10.</li>
<li>Among the stocks to which the ceiling is applied, the stocks with a relatively sizeable passive impact (at the current prices) are <strong>SK Innovation, Ecopro BM, and Posco Chemical</strong>.</li>
<li>Among the companies that have been listed since June, the companies that directly operate the rechargeable battery business are the following three: <strong>Enchem</strong>, GI Tech, and Onejoon.</li>
</ul>


The rebalancing implementation of the FnGuide Secondary Battery Index will be on December 13. So, the ETF operator's rebalancing trading will take place at the close on December 10.
Among the stocks to which the ceiling is applied, the stocks with a relatively sizeable passive impact (at the current prices) are SK Innovation, Ecopro BM, and Posco Chemical.
Among the companies that have been listed since June, the companies that directly operate the rechargeable battery business are the following three: Enchem, GI Tech, and Onejoon.


FnGuide Secondary Battery Index Rebalancing Preview in December: Watch Enchem

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Capital Markets

<p><a href="https://www.smartkarma.com/entities/enchem-co-ltd" target="_blank" data-smartkarma-citation="entities:34297:1" rel="noopener">Enchem (348370 KS)</a> reported strong book building results and the IPO price has been finalized at 42,000 won per share, which was 20% higher than the high end of the IPO price range of 35,000 won. The IPO of Enchem will start trading on 1 November.</p><p>Enchem's<a href="http://www.ipo38.co.kr/ipo/index.htm?o=v&amp;key=6&amp;no=1714&amp;l=&amp;page=1" target="_blank" rel="noopener"> gray market price</a> is trading at around 71,000 won per share, which is 69% higher than the IPO price of 42,000 won. There were 1,721 institutions that participated in this IPO survey and the demand ratio for the IPO shares were 1,647 to 1.</p><p>The company had some excellent book building data points. For example, a 73.9% of the institutional investors thought that the intrinsic value of Enchem should be more than 42,000 won. In addition, a very high ratio (64.4%) of the institutional investors' subscribed shares are under various lock-up periods.</p><div class="content-highlight"><p>Our base case valuation of Enchem remains implied market cap of 904 billion won or 55,777 won per share, which is 33% higher than the IPO price range of 42,000 won per share. Given the strong upside, we have a POSITIVE view of the Enchem IPO. Our base case valuation is based on a P/E of 45.7x our estimated net profit of 20 billion won in 2022.</p></div>

Enchem (348370 KS) reported strong book building results and the IPO price has been finalized at 42,000 won per share, which was 20% higher than the high end of the IPO price range of 35,000 won. The IPO of Enchem will start trading on 1 November.Enchem's gray market price is trading at around 71,000 won per share, which is 69% higher than the IPO price of 42,000 won. There were 1,721 institutions that participated in this IPO survey and the demand ratio for the IPO shares were 1,647 to 1.The company had some excellent book building data points. For example, a 73.9% of the institutional investors thought that the intrinsic value of Enchem should be more than 42,000 won. In addition, a very high ratio (64.4%) of the institutional investors' subscribed shares are under various lock-up periods.Our base case valuation of Enchem remains implied market cap of 904 billion won or 55,777 won per share, which is 33% higher than the IPO price range of 42,000 won per share. Given the strong upside, we have a POSITIVE view of the Enchem IPO. Our base case valuation is based on a P/E of 45.7x our estimated net profit of 20 billion won in 2022.

Enchem IPO - Excellent Book Building Results

<p>KRX officially announced today that it would not apply the volatility interruption on the first day of listing for newly listed stocks from <strong>October 18th</strong>.</p><p><strong>Both dynamic VI and static VI do not apply on the listing date.</strong> However, in the case of a transfer listing from the KOSDAQ to the KOSPI or a transfer listing from the KOSPI to the KOSDAQ, the current VI continues to apply. However, it won't apply for a transfer from KONEX to KOSDAQ.</p><section class="figure"><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/232/793/original/1.png?1632975345" class="editor-image img-responsive" data-smartkarma-image-id="232793"></figure></section><div class="content-caption">(Source: KRX)</div><div class="content-highlight"><p>Attached below is the full version of the press release by the KRX.</p></div><p>KRX cited as the reason for this rule change that, although it is a natural phenomenon that price fluctuations accompany the process of finding a fair price on the listing date, the VI was excessively triggered in the recent listings, which undermines transaction continuity.</p><p>In particular, there has been frequent VI activation immediately after the opening, where many investors participated, caused many problems by stopping trading and delaying the discovery of a fair price. Therefore, through this measure, KRX expects to improve the process of finding a fair price for newly listed stocks by increasing transaction continuity on the listing date.</p>

KRX officially announced today that it would not apply the volatility interruption on the first day of listing for newly listed stocks from October 18th.Both dynamic VI and static VI do not apply on the listing date. However, in the case of a transfer listing from the KOSDAQ to the KOSPI or a transfer listing from the KOSPI to the KOSDAQ, the current VI continues to apply. However, it won't apply for a transfer from KONEX to KOSDAQ.(Source: KRX)Attached below is the full version of the press release by the KRX.KRX cited as the reason for this rule change that, although it is a natural phenomenon that price fluctuations accompany the process of finding a fair price on the listing date, the VI was excessively triggered in the recent listings, which undermines transaction continuity.In particular, there has been frequent VI activation immediately after the opening, where many investors participated, caused many problems by stopping trading and delaying the discovery of a fair price. Therefore, through this measure, KRX expects to improve the process of finding a fair price for newly listed stocks by increasing transaction continuity on the listing date.

No VI (Volatility Interruption) Applies to Korean IPO Stocks on the Listing Date After October 18

South Korea

ENCHEM Co.,Ltd. produces and sells electrolyte and functional additives. The Company develops, manufactures and markets lithium rechargeable batteries electrolytes, polymer batteries electrolytes, high functionality additives, and other products. ENCHEM markets its products primarily throughout Korea with limited overseas.

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Enchem (348370 KS)

TIGER Secondary Cell ETF Rebalancing Trading on January 13

WISE Secondary Cell ETF rebalancing will take place tomorrow, supposedly at the close. Those worthy of our attention are SKIET +0.71x ADTV, POSCO...

Sanghyun Park

Korea Sector Indexes with December Rebalancing: Passive Impact by Date

There are six local sector indexes in total, which have a meaningful level of AUM and will be rebalanced in December. This post tracks the passive...

Sanghyun Park

FnGuide Secondary Battery Index Rebalancing Preview in December: Watch Enchem

The FnGuide Secondary Battery Index (KODEX ETF) rebalancing in December is expected to see several names with a sizeable passive impact.

Sanghyun Park

Enchem IPO - Excellent Book Building Results

Enchem (348370 KS) reported strong book building results and the IPO price has been finalized at 42,000 won per share, which was 20% higher than...

Douglas Kim

No VI (Volatility Interruption) Applies to Korean IPO Stocks on the Listing Date After October 18

The KRX made it official that no VI (volatility interruption) applies to IPO stocks on the listing date after October 18. This post details the...

Sanghyun Park

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