Index Rebal/Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal/Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Index Rebalance

<ul>
<li>The ES50 Index is one of the most highly-tracked indices in mainland Europe and the annual index review takes place in September.</li>
<li>As ES50 index changes generally involve large cap names, these Rebalance events have historically had significant volume and ADV impact.</li>
<li>In this insight, we take a look the names leading the race to become ADDs/DELs for the upcoming index review in September 2023.</li>
</ul>


The ES50 Index is one of the most highly-tracked indices in mainland Europe and the annual index review takes place in September.
As ES50 index changes generally involve large cap names, these Rebalance events have historically had significant volume and ADV impact.
In this insight, we take a look the names leading the race to become ADDs/DELs for the upcoming index review in September 2023.


Quiddity Leaderboard ES50 Sep 23: Massive Flows; Might Be Time for LONG Ferrari - SHORT Vonovia

Equity Analyst, LightStream Research

Oshadhi Kumarasiri

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Equity Bottom-Up

Mandarin Oriental International / Equity Bottom-Up

Mandarin Oriental International (MAND SP)

<ul>
<li>While traditional luxury brands may encounter challenges as affluent Chinese consumers shift to local high-end brands, there are still opportunities within small niches in the luxury sector.</li>
<li>Luxury travel, driven by trends like micro trips and the increasing number of High-Net-Worth Individuals, represents a potential area of growth in the luxury sector.</li>
<li>The thriving luxury travel market opens up investment potential in sectors such as luxury hotels and premium cosmetics.</li>
</ul>


While traditional luxury brands may encounter challenges as affluent Chinese consumers shift to local high-end brands, there are still opportunities within small niches in the luxury sector.
Luxury travel, driven by trends like micro trips and the increasing number of High-Net-Worth Individuals, represents a potential area of growth in the luxury sector.
The thriving luxury travel market opens up investment potential in sectors such as luxury hotels and premium cosmetics.


APAC Luxury Industry Series: Luxury Travel Shines Amid Challenges for Traditional Luxury Goods

<ul>
<li>The ES50 Index is one of the most highly-tracked indices in mainland Europe and the annual index review takes place in September.</li>
<li>Historically, these Rebalance events have had significant volume and ADV impact and they generally involve large cap names. </li>
<li>In this insight, we take a look the names leading the race to become ADDs/DELs for the upcoming index review in September 2023.</li>
</ul>


The ES50 Index is one of the most highly-tracked indices in mainland Europe and the annual index review takes place in September.
Historically, these Rebalance events have had significant volume and ADV impact and they generally involve large cap names. 
In this insight, we take a look the names leading the race to become ADDs/DELs for the upcoming index review in September 2023.


Quiddity Leaderboard ES50 Sep 23: Ferrari Retains the Lead; US$1.26bn Potential Inflow

Quiddity Leaderboard ES50 Sep 23: Ferrari RACEs into the Lead; US$1.2bn Potential Inflow

Equity, Bottom-up Analyst, Investics Research

Sameer Taneja

Equity, Bottom-up Analyst

Investics Research

It is important to note that the information provided by Investics Research is based on publicly available data and own knowledge, which has been gathered and analyzed from a variety of sources. While every effort has been made to ensure the accuracy and completeness of the information provided, it is not guaranteed to be free from errors or omissions. All forecasts and estimates are based on information that has been obtained from public sources that are considered to be reliable. The sources include but are not limited to, company announcements, exchange filings, presentations, etc. Investics does not guarantee the accuracy and completeness of the forecasts, estimates, and/or other information.

Equity Bottom-up Research

<ul>
<li>Q1 CY23 watch and jewelry sales for HK were up 88% YoY. HK sales for Oriental Watch (30% of revenues but less volatile) will benefit from the recovery in HK.</li>
<li>We estimate China sales will continue to remain resilient as cross-border travel is yet to pick up in a big way. </li>
<li>Trading at 7.5x FY23e and a 14.2% dividend yield, with more than 50% of the market capitalization in cash, the company can pay solid future dividends despite weaker earnings.</li>
</ul>


Q1 CY23 watch and jewelry sales for HK were up 88% YoY. HK sales for Oriental Watch (30% of revenues but less volatile) will benefit from the recovery in HK.
We estimate China sales will continue to remain resilient as cross-border travel is yet to pick up in a big way. 
Trading at 7.5x FY23e and a 14.2% dividend yield, with more than 50% of the market capitalization in cash, the company can pay solid future dividends despite weaker earnings.


Oriental Watch: HK Sales Recovery Continues for Q1 2023,14% Dividend Yield, >50% of Mkt Cap in Cash

Italy

Ferrari designs, engineers, produces, and sells luxury performance sports cars globally, offering a range including special series, Icona, and supercars, alongside racing cars and after-sales services. The company also licenses its brand for luxury goods and participates in Formula 1 racing. Ferrari was founded in 1947 and is headquartered in Maranello, Italy.

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Ferrari (RACE IM)

Quiddity Leaderboard ES50 Sep 23: Massive Flows; Might Be Time for LONG Ferrari - SHORT Vonovia

I would go LONG Ferrari - SHORT Vonovia until the Inclusion event considering the significance of the expected index flow dynamics even though...

Janaghan Jeyakumar, CFA

APAC Luxury Industry Series: Luxury Travel Shines Amid Challenges for Traditional Luxury Goods

Luxury travel, driven by trends like micro trips and the increasing number of High-Net-Worth Individuals, represents a potential area of growth in...

Oshadhi Kumarasiri

Quiddity Leaderboard ES50 Sep 23: Ferrari Retains the Lead; US$1.26bn Potential Inflow

If Ferrari's share price does not fall by more than 10% vs other potential ADDs, Ferrari could become an ADD and experience an index inflow of...

Janaghan Jeyakumar, CFA

Quiddity Leaderboard ES50 Sep 23: Ferrari RACEs into the Lead; US$1.2bn Potential Inflow

Vonovia seems like a high-conviction DEL and Ferrari could replace Vonovia in the ES50 index. There could be 16.1 days to sell in Vonovia and 11.6...

Janaghan Jeyakumar, CFA

Oriental Watch: HK Sales Recovery Continues for Q1 2023,14% Dividend Yield, >50% of Mkt Cap in Cash

Oriental Watch trades at 7.5x PE, with over 50% of the market capitalization as cash and a 14.2% dividend yield. The recovery in HK sales which...

Sameer Taneja

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