Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Index Rebalance

<p>The Korea Exchange (KRX) launched 5 indices last year following the New Deal initiative that the Government launched to digitalise social infrastructure and jumpstart the transition to green energy.</p><p>The KRX created 4 indices tracking the Secondary Battery, Biotech, Internet and Gaming sectors that are expected to benefit from the New Deal initiative plus an additional index (BBIG) that includes the top 3 stocks from each sector.</p><p>All indices have performed well since then. The KRX announced changes to the 5 indices late last week and the changes become effective post the close of trading on 25 February.</p><div><p><a href="https://www.smartkarma.com/entities/kakao-games-corp" target="_blank" data-smartkarma-citation="entities:26730:1" rel="noopener">Kakao Games Corp (293490 KS)</a> replaces <a href="https://www.smartkarma.com/entities/pearl-abyss-corp" target="_blank" data-smartkarma-citation="entities:24391:1" rel="noopener">Pearl Abyss (263750 KS)</a> in the BBIG Index.</p></div><div><p>In the Secondary Battery index, <a href="https://www.smartkarma.com/entities/soulbrain-co-ltd" target="_blank" data-smartkarma-citation="entities:16883:1" rel="noopener">Soulbrain (036830 KS)</a> and <a href="https://www.smartkarma.com/entities/l-f-co-ltd" target="_blank" data-smartkarma-citation="entities:14300:1" rel="noopener">L&amp;F Co Ltd (066970 KS)</a> replace <a href="https://www.smartkarma.com/entities/doosan-solus-co-ltd" target="_blank" data-smartkarma-citation="entities:28947:1" rel="noopener">Doosan Solus Co Ltd (336370 KS)</a> and <a href="https://www.smartkarma.com/entities/foosung-co-ltd" target="_blank" data-smartkarma-citation="entities:16811:1" rel="noopener">Foosung Co Ltd (093370 KS)</a>.</p></div><div><p>In the Biotech index, <a href="https://www.smartkarma.com/entities/shinpoong-pharmaceutical-co-ltd" target="_blank" data-smartkarma-citation="entities:7296:1" rel="noopener">Shinpoong Pharmaceutical (019170 KS)</a> and <a href="https://www.smartkarma.com/entities/green-cross-corp" target="_blank" data-smartkarma-citation="entities:2969:1" rel="noopener">Green Cross (006280 KS)</a> replace <a href="https://www.smartkarma.com/entities/alteogen-inc" target="_blank" data-smartkarma-citation="entities:15886:1" rel="noopener">Alteogen Inc (196170 KS)</a> and <a href="https://www.smartkarma.com/entities/hanmi-pharm-co-ltd" target="_blank" data-smartkarma-citation="entities:12476:1" rel="noopener">Hanmi Pharm (128940 KS)</a>.</p></div><div><p>In the Internet index, <a href="https://www.smartkarma.com/entities/ace-technologies-corp" target="_blank" data-smartkarma-citation="entities:7868:1" rel="noopener">Ace Technologies (088800 KS)</a> and <a href="https://www.smartkarma.com/entities/rsupport-co-ltd" target="_blank" data-smartkarma-citation="entities:14783:1" rel="noopener">Rsupport Co Ltd (131370 KS)</a> replace <a href="https://www.smartkarma.com/entities/kg-inicis-co-ltd" target="_blank" data-smartkarma-citation="entities:5234:1" rel="noopener">KG Inicis Co Ltd (035600 KS)</a> and <a href="https://www.smartkarma.com/entities/ubiquoss-inc" target="_blank" data-smartkarma-citation="entities:14341:1" rel="noopener">Ubiquoss Holding (078070 KS)</a>.</p></div><div><p>In the Gaming index, <a href="https://www.smartkarma.com/entities/kakao-games-corp" target="_blank" data-smartkarma-citation="entities:26730:1" rel="noopener">Kakao Games Corp (293490 KS)</a> and <a href="https://www.smartkarma.com/entities/neptune-company" target="_blank" data-smartkarma-citation="entities:28826:1" rel="noopener">Neptune Company (217270 KS)</a> replace <a href="https://www.smartkarma.com/entities/neowiz-games-corp" target="_blank" data-smartkarma-citation="entities:12425:1" rel="noopener">Neowiz Games (095660 KS)</a> and Golfzon (215000 KS).</p></div>

The Korea Exchange (KRX) launched 5 indices last year following the New Deal initiative that the Government launched to digitalise social infrastructure and jumpstart the transition to green energy.The KRX created 4 indices tracking the Secondary Battery, Biotech, Internet and Gaming sectors that are expected to benefit from the New Deal initiative plus an additional index (BBIG) that includes the top 3 stocks from each sector.All indices have performed well since then. The KRX announced changes to the 5 indices late last week and the changes become effective post the close of trading on 25 February.Kakao Games Corp (293490 KS) replaces Pearl Abyss (263750 KS) in the BBIG Index.In the Secondary Battery index, Soulbrain (036830 KS) and L&amp;F Co Ltd (066970 KS) replace Doosan Solus Co Ltd (336370 KS) and Foosung Co Ltd (093370 KS).In the Biotech index, Shinpoong Pharmaceutical (019170 KS) and Green Cross (006280 KS) replace Alteogen Inc (196170 KS) and Hanmi Pharm (128940 KS).In the Internet index, Ace Technologies (088800 KS) and Rsupport Co Ltd (131370 KS) replace KG Inicis Co Ltd (035600 KS) and Ubiquoss Holding (078070 KS).In the Gaming index, Kakao Games Corp (293490 KS) and Neptune Company (217270 KS) replace Neowiz Games (095660 KS) and Golfzon (215000 KS).

KRX BBIG K-NewDeal Index Rebalance: First Set of Changes Announced

Korea / Special Situations, Clepsydra Capital

Sanghyun Park

Korea / Special Situations

Event-Driven

<p>We now have the across-the-board shorting restriction in Korea for the next six months. It means that we will have to adjust our approach on most of the pairs trading names. That is, it is time for those carrying futures to draw more attention.</p><p>First, let's look at the full list of Korean holding companies. There are a total of 112 holding companies. The below list shows them in the order of market cap.</p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/123/135/original/1.png?1584294126" class="editor-image img-responsive" data-smartkarma-image-id="123135"></figure><p>Out of the 112 names, these are 21 holding companies with a current market cap of ₩500bil or more, and which have at least one listed subsidiary on either KOSPI or KOSDAQ.</p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/123/136/original/2.png?1584294321" class="editor-image img-responsive" data-smartkarma-image-id="123136"></figure><p>Finally, below are the names whose one or two subsidiaries account for 50% or more of the holding company NAV. </p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/123/139/original/3.png?1584295319" class="editor-image img-responsive" data-smartkarma-image-id="123139"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/123/143/original/4.png?1584295789" class="editor-image img-responsive" data-smartkarma-image-id="123143"></figure>

We now have the across-the-board shorting restriction in Korea for the next six months. It means that we will have to adjust our approach on most of the pairs trading names. That is, it is time for those carrying futures to draw more attention.First, let's look at the full list of Korean holding companies. There are a total of 112 holding companies. The below list shows them in the order of market cap.Out of the 112 names, these are 21 holding companies with a current market cap of ₩500bil or more, and which have at least one listed subsidiary on either KOSPI or KOSDAQ.Finally, below are the names whose one or two subsidiaries account for 50% or more of the holding company NAV. 

Korean Stub Trade in a New Era: List of Holdcos Having Single Stock Futures

<p>We are now seeing a very interesting move from Korea's local institutions on those SK Group restructuring stocks. Last week, to be specific from Sep 25 to 29, the two stocks standing at the center of the SK Group restructuring process made the local institutions' top 10 net buying stock list in KOSPI/KOSDAQ. They are <a href="https://www.smartkarma.com/entities/393" target="_blank" data-smartkarma-citation="entities:393:1">SK Holdings Co Ltd (034730 KS)</a> and <a href="https://www.smartkarma.com/entities/395" target="_blank" data-smartkarma-citation="entities:395:1">SK Telecom (017670 KS)</a>. More importantly and interestingly, SK Holdings ranked top in this list as local institutions net purchased ₩75.1bil worth…</p>

We are now seeing a very interesting move from Korea's local institutions on those SK Group restructuring stocks. Last week, to be specific from Sep 25 to 29, the two stocks standing at the center of the SK Group restructuring process made the local institutions' top 10 net buying stock list in KOSPI/KOSDAQ. They are SK Holdings Co Ltd (034730 KS) and SK Telecom (017670 KS). More importantly and interestingly, SK Holdings ranked top in this list as local institutions net purchased ₩75.1bil worth…

SK Group Restructuring - Local Institutions Are Already Making A Move

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Bottom-Up

<p><strong>Why Look at</strong><strong>Yuhan Corp?</strong></p><p>Yuhan Corp shares are quite interesting at current levels. It is currently trading at 214,000 won, which is down 38% <em>(A Fibonacci retracement area for the Fibonacci followers</em><em>!)</em> from its 52 week high. After a blistering share price appreciation in 2015, Yuhan Corp, like many of the Korean pharma stocks, have had a disappointing year in 2016. Yuhan Corp shares are down 22% YTD. Despite the decline in share price, Yuhan Corp continued its solid growth is sales, earnings, and equity in 2016. Yuhan Corp has strong fundamentals. The decline in share price has made Yuhan Corp's valuations much more reasonable at 18x P/E (based on consensus earnings estimates in 2017). </p><p>The Korean pharma stocks got whacked in September to November 2016. <strong>Tiger 200 Healthcare ETF (227540 KS)</strong> which is composed of mostly major pharmaceutical companies was down 29% from the end of August 2016 to end of November 2016. The major reason why the entire Korean pharma stocks got crushed during this period was because of Hanmi Pharmaceutical. There were two main negative issues with regards to Hanmi Pharmaceutical: The first one dealt with the cancellation of a license deal on lung cancer treatments with Boehringer Ingelheim. The second issue was insider trading of alleged leaked information on a major deal termination to investors. </p><p>The Korean pharmaceutical sector has been the best-performing sector in Korea in the past three weeks. Tiger 200 Healthcare ETF (227540 KS) is up 12% in the past three weeks. The surge in avian flu in the past five weeks has been a major driver of this rebound. There are increasing signs that the Korean pharmaceutical stocks are bottoming and it may be prudent to look at market leaders such as Yuhan Corp for a potential investment. </p>

Why Look atYuhan Corp?Yuhan Corp shares are quite interesting at current levels. It is currently trading at 214,000 won, which is down 38% (A Fibonacci retracement area for the Fibonacci followers!) from its 52 week high. After a blistering share price appreciation in 2015, Yuhan Corp, like many of the Korean pharma stocks, have had a disappointing year in 2016. Yuhan Corp shares are down 22% YTD. Despite the decline in share price, Yuhan Corp continued its solid growth is sales, earnings, and equity in 2016. Yuhan Corp has strong fundamentals. The decline in share price has made Yuhan Corp's valuations much more reasonable at 18x P/E (based on consensus earnings estimates in 2017). The Korean pharma stocks got whacked in September to November 2016. Tiger 200 Healthcare ETF (227540 KS) which is composed of mostly major pharmaceutical companies was down 29% from the end of August 2016 to end of November 2016. The major reason why the entire Korean pharma stocks got crushed during this period was because of Hanmi Pharmaceutical. There were two main negative issues with regards to Hanmi Pharmaceutical: The first one dealt with the cancellation of a license deal on lung cancer treatments with Boehringer Ingelheim. The second issue was insider trading of alleged leaked information on a major deal termination to investors. The Korean pharmaceutical sector has been the best-performing sector in Korea in the past three weeks. Tiger 200 Healthcare ETF (227540 KS) is up 12% in the past three weeks. The surge in avian flu in the past five weeks has been a major driver of this rebound. There are increasing signs that the Korean pharmaceutical stocks are bottoming and it may be prudent to look at market leaders such as Yuhan Corp for a potential investment. 

Yuhan Corp: (Part I) - Oversold on Hanmi Pharma Scares

<p>It is estimated that more than 20 million chickens (and ducks) have been culled in Korea in the past several weeks, representing about 12% of all poultry in Korea and this has set a new record. Egg prices have been soaring (up about 25% in the past month) and many Korean consumers have been avoiding eating chicken. In Korea, there are more than 50,000 chicken related franchise restaurants and stores (and thousands of more restaurants that are negatively impacted by lower chicken related sales). </p><p>…</p>

It is estimated that more than 20 million chickens (and ducks) have been culled in Korea in the past several weeks, representing about 12% of all poultry in Korea and this has set a new record. Egg prices have been soaring (up about 25% in the past month) and many Korean consumers have been avoiding eating chicken. In Korea, there are more than 50,000 chicken related franchise restaurants and stores (and thousands of more restaurants that are negatively impacted by lower chicken related sales). …

20 Million Chickens (And Ducks) Culled in Korea

South Korea

Hanmi Pharm. Company Ltd. produces pharmaceutical products, including antibiotics, vitamins, and intestinal tonics.  The Company also provides beverages and processes soft capsules for other pharmaceutical firms.

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Hanmi Pharm (128940 KS)

KRX BBIG K-NewDeal Index Rebalance: First Set of Changes Announced

The KRX has announced changes to the KRX New Deal indices that will be effective after the close of trading on 25 February. Pearl Abyss is...

Brian Freitas

Korean Stub Trade in a New Era: List of Holdcos Having Single Stock Futures

We now have the across-the-board shorting restriction in Korea for the next six months. It means that we will have to adjust our approach on most...

Sanghyun Park

SK Group Restructuring - Local Institutions Are Already Making A Move

We are now seeing a very interesting move from Korea's local institutions on those SK Group restructuring stocks. Last week, to be specific from...

Sanghyun Park

Yuhan Corp: (Part I) - Oversold on Hanmi Pharma Scares

Why Look atYuhan Corp?Yuhan Corp shares are quite interesting at current levels. It is currently trading at 214,000 won, which is down 38% (A...

Douglas Kim

20 Million Chickens (And Ducks) Culled in Korea

It is estimated that more than 20 million chickens (and ducks) have been culled in Korea in the past several weeks, representing about 12% of all...

Douglas Kim

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