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>Post market close on Friday, Hang Seng Indexes will announce the changes for the <a href="https://www.smartkarma.com/entities/hong-kong-hang-seng-index" target="_blank" data-smartkarma-citation="entities:22899:1" rel="noopener">Hang Seng Index (HSI INDEX)</a> that will be implemented at the close on 6 December.</li>
<li>With no increase in the number of index constituents this calendar year, there could be inclusions in December. The process of getting to 100 index constituents could drag into 2026.</li>
<li>Short interest is especially large in <a href="https://www.smartkarma.com/entities/sinotruk-hong-kong-ltd" target="_blank" data-smartkarma-citation="entities:19764:1" rel="noopener">Sinotruk</a>, <a href="https://www.smartkarma.com/entities/giant-biogene-holding-co-ltd" target="_blank" data-smartkarma-citation="entities:35950:1" rel="noopener">Giant Biogene</a>, <a href="https://www.smartkarma.com/entities/kuaishou-technology" target="_blank" data-smartkarma-citation="entities:29725:1" rel="noopener">Kuaishou Technology</a>, <a href="https://www.smartkarma.com/entities/asm-pacific-technology-ltd" target="_blank" data-smartkarma-citation="entities:15061:1" rel="noopener">ASMPT</a> and <a href="https://www.smartkarma.com/entities/jd-logistics-inc" target="_blank" data-smartkarma-citation="entities:31500:1" rel="noopener">JD Logistics</a> and inclusion could set off some short covering.</li>
</ul>


Post market close on Friday, Hang Seng Indexes will announce the changes for the Hang Seng Index (HSI INDEX) that will be implemented at the close on 6 December.
With no increase in the number of index constituents this calendar year, there could be inclusions in December. The process of getting to 100 index constituents could drag into 2026.
Short interest is especially large in Sinotruk, Giant Biogene, Kuaishou Technology, ASMPT and JD Logistics and inclusion could set off some short covering.


Hang Seng Index (HSI) Rebalance Preview: Inclusion Candidates for December

Asian Hedge Fund Manager, Long Short Equity, Macro

David Mudd

Equity Bottom-Up

<ul>
<li>Although Hong Kong markets have slumped after Trump's election, mainland China's markets have gained.  Southbound net buying of HK stocks hit a 2024 high on the day Trump won.</li>
<li>
<a href="https://www.smartkarma.com/entities/sands-china-ltd" target="_blank" data-smartkarma-citation="entities:182:1" rel="noopener">Sands China (1928 HK)</a> had a breakout from a double top as Macau recorded good Golden Week arrivals.  <a href="https://www.smartkarma.com/entities/blue-moon-group-holdings" target="_blank" data-smartkarma-citation="entities:29179:1" rel="noopener">Blue Moon Group Holdings (6993 HK)</a> had a breakout after 3 years.
</li>
<li>
<a href="https://www.smartkarma.com/entities/cansino-biologics-inc" target="_blank" data-smartkarma-citation="entities:27739:1" rel="noopener">CanSino Biologics (6185 HK)</a> formed a breakout after a new vaccine was approved and it reported better results.  <a href="https://www.smartkarma.com/entities/haidilao-international-holding" target="_blank" data-smartkarma-citation="entities:27044:1" rel="noopener">Haidilao International Holding (6862 HK)</a> share price advanced as it expands stores.
</li>
</ul>


Although Hong Kong markets have slumped after Trump's election, mainland China's markets have gained.  Southbound net buying of HK stocks hit a 2024 high on the day Trump won.

Sands China (1928 HK) had a breakout from a double top as Macau recorded good Golden Week arrivals.  Blue Moon Group Holdings (6993 HK) had a breakout after 3 years.


CanSino Biologics (6185 HK) formed a breakout after a new vaccine was approved and it reported better results.  Haidilao International Holding (6862 HK) share price advanced as it expands stores.



Technically Speaking, Breakouts and Breakdowns: HONG KONG (NOVEMBER 13)

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/eternal-beauty-holdings-limited" target="_blank" data-smartkarma-citation="entities:43725:1" rel="noopener">Eternal Beauty Holdings </a>(EB) is looking to raise about US$200m in its upcoming Hong Kong IPO.</li>
<li>Eternal Beauty is the largest brand management company of perfumes in the combined markets of Mainland China, Hong Kong and Macau, in terms of retail sales in 2023.</li>
<li>In this note, we talk about the not-so-positive aspects of the deal.</li>
</ul>



Eternal Beauty Holdings (EB) is looking to raise about US$200m in its upcoming Hong Kong IPO.
Eternal Beauty is the largest brand management company of perfumes in the combined markets of Mainland China, Hong Kong and Macau, in terms of retail sales in 2023.
In this note, we talk about the not-so-positive aspects of the deal.


Eternal Beauty Pre-IPO - The Negatives - Core Offering Hasn’t Been Growing

<ul>
<li>Hong Kong Conglomerate Sector is showing renewed strength with Materials and Energy under pressure.  HK market 30 day volatility at 5 year low as market continues to de-risk.</li>
<li>
<a href="https://www.smartkarma.com/entities/hengan-international-group-co-ltd" target="_blank" data-smartkarma-citation="entities:29:1" rel="noopener">Hengan International Group (1044 HK)</a> chart broke down from its Descending Triangle pattern after reporting its 1H24 results. <a href="https://www.smartkarma.com/entities/j-t-global-express-ltd" target="_blank" data-smartkarma-citation="entities:36819:1" rel="noopener">J&amp;T Global Express (1519 HK)</a> broke down from its double bottom pattern.
</li>
<li>
<a href="https://www.smartkarma.com/entities/china-galaxy-securities-co-h" target="_blank" data-smartkarma-citation="entities:165:1" rel="noopener">China Galaxy Securities (H) (6881 HK)</a> price relative to the MSCI China index broke to a new high.  The company reported good results in a difficult environment for China brokers.
</li>
</ul>


Hong Kong Conglomerate Sector is showing renewed strength with Materials and Energy under pressure.  HK market 30 day volatility at 5 year low as market continues to de-risk.

Hengan International Group (1044 HK) chart broke down from its Descending Triangle pattern after reporting its 1H24 results. J&amp;T Global Express (1519 HK) broke down from its double bottom pattern.


China Galaxy Securities (H) (6881 HK) price relative to the MSCI China index broke to a new high.  The company reported good results in a difficult environment for China brokers.



Technically Speaking, Breakouts and Breakdowns: HONG KONG (SEPTEMBER 13)

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

China Traditional Chinese Medicine / Event-Driven

China Traditional Chinese Medicine (570 HK)

<ul>
<li>
<a href="https://www.smartkarma.com/entities/china-traditional-chinese-medicine" target="_blank" data-smartkarma-citation="entities:351:1" rel="noopener">China Traditional Chinese Medicine (570 HK)</a>'s profit warning suggests weaker-than-expected 2024H1 results, but the interim report is needed for clarity. This is unlikely to negatively affect the company's privatization plans.</li>
<li>In 24H1, healthcare investment and financing activities have slowed, and it will take time for investors' confidence in the sector to recover.</li>
<li>
<a href="https://www.smartkarma.com/entities/giant-biogene-holding-co-ltd" target="_blank" data-smartkarma-citation="entities:35950:1" rel="noopener">Giant Biogene (2367 HK)</a>'s 24H1 results exceeded expectations, leading management to raise its 2024 guidance. However, the profit margin declined, and we remain cautious about long-term growth prospects.</li>
</ul>



China Traditional Chinese Medicine (570 HK)'s profit warning suggests weaker-than-expected 2024H1 results, but the interim report is needed for clarity. This is unlikely to negatively affect the company's privatization plans.
In 24H1, healthcare investment and financing activities have slowed, and it will take time for investors' confidence in the sector to recover.

Giant Biogene (2367 HK)'s 24H1 results exceeded expectations, leading management to raise its 2024 guidance. However, the profit margin declined, and we remain cautious about long-term growth prospects.


China Healthcare Weekly (Aug.25)- China TCM 24H1 Profit Warning, Financing Activities, Giant Biogene

China

Giant Biogene designs, develops, manufactures, and sells beauty and health products, primarily functional skincare products and medical dressings, utilizing recombinant collagen as a key bioactive ingredient. The company also develops and manufactures functional foods based on rare ginsenosides technology. It was founded in 2000 and is headquartered in Xi'an, People's Republic of China.

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Giant Biogene (2367 HK)

Hang Seng Index (HSI) Rebalance Preview: Inclusion Candidates for December

We highlight 10 potential inclusions for the HSI in Dec. The number of constituents has not increased this year and the target to reach 100 members...

Brian Freitas

Technically Speaking, Breakouts and Breakdowns: HONG KONG (NOVEMBER 13)

Mainland China's A-share market advanced after Trump's election as South Connect buying hit a 3 year high. Sands China had a breakout as Macau...

David Mudd

Eternal Beauty Pre-IPO - The Negatives - Core Offering Hasn’t Been Growing

Eternal Beauty Holdings (EB) is looking to raise about US$200m in its upcoming Hong Kong IPO. In this note, we talk about the not-so-positive...

Sumeet Singh

Technically Speaking, Breakouts and Breakdowns: HONG KONG (SEPTEMBER 13)

Hong Kong conglomerate sector shows increased momentum. Hengan and J&T technical patterns broke down. J&T fell to new lows since its listing last...

David Mudd

China Healthcare Weekly (Aug.25)- China TCM 24H1 Profit Warning, Financing Activities, Giant Biogene

China TCM Profit Warning shows lower-than-expected 24H1 results but it won't affect privatization.Confidence in healthcare investment takes time to...

Xinyao (Criss) Wang

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