External broker reports(aggregated public sources), Mirae Asset Securities

Mirae Asset Securities

External broker reports(aggregated public sources)

Mirae Asset Securities Co.,Ltd. provides comprehensive wealth management services. The Company offers fixed income securities brokerage, securities dealing, equity underwriting, and other services. Mirae Asset Securities also deals with mergers and acquisitions, foreign currency, and financial derivatives

Equity Bottom-Up

<ul><li>For 2Q25, revenue was W2.86tr (+11.7% YoY, +7.5% vs. consensus of W2.66tr), while operating profit came in at W64.1bn (-10.2% YoY), well above consensus of W21.7bn.</li><li>OP margin was 2.2% (-0.5%p YoY, +1.4%p QoQ). There were negative impacts from tariffs (W50.5bn), depreciation (W23.1bn), and narrower scope of R&amp;D capitalization (W42.4bn).</li><li>Even so, profitability improvement activities and client compensation effects helped deliver results that were stronger than feared.</li></ul>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

For 2Q25, revenue was W2.86tr (+11.7% YoY, +7.5% vs. consensus of W2.66tr), while operating profit came in at W64.1bn (-10.2% YoY), well above consensus of W21.7bn.OP margin was 2.2% (-0.5%p YoY, +1.4%p QoQ). There were negative impacts from tariffs (W50.5bn), depreciation (W23.1bn), and narrower scope of R&amp;D capitalization (W42.4bn).Even so, profitability improvement activities and client compensation effects helped deliver results that were stronger than feared.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Hanon Systems (018880 KS/Hold)Better-Than-Feared Earnings, Disappointing Capital Increase Plan

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

Event-Driven

<ul>
<li>On 14 August, Hanon Systems (018880 KS) announced a potential rights offering capital raise. The exact amount will be finalized at the EGM next month. </li>
<li>The significant size of the rights offering is expected to burden its largest shareholder Hankook Tire &amp; Technology (161390 KS) which owns a 54.8% stake in Hanon Systems. </li>
<li>We believe the potential rights offering is likely to continue to negatively impact Hanon Systems by diluting its existing shareholders. </li>
</ul>


On 14 August, Hanon Systems (018880 KS) announced a potential rights offering capital raise. The exact amount will be finalized at the EGM next month. 
The significant size of the rights offering is expected to burden its largest shareholder Hankook Tire &amp; Technology (161390 KS) which owns a 54.8% stake in Hanon Systems. 
We believe the potential rights offering is likely to continue to negatively impact Hanon Systems by diluting its existing shareholders. 


Hanon Systems Announces a Major Potential Rights Offering

<ul>
<li>In this insight, we review the major equity indices in Korea in 2024 including KOSPI 200 and Korea Value Up Index. </li>
<li>Some alpha generating performances continue in terms of adding stocks to be included in the KOSPI 200 and reducing stocks that could be excluded.</li>
<li>Korea Value Up Index has been heavily promoted by the Korean Exchange this year. Korea Exchange plans to make special changes to the Korea Value-Up Index constituents on 20 December. </li>
</ul>


In this insight, we review the major equity indices in Korea in 2024 including KOSPI 200 and Korea Value Up Index. 
Some alpha generating performances continue in terms of adding stocks to be included in the KOSPI 200 and reducing stocks that could be excluded.
Korea Value Up Index has been heavily promoted by the Korean Exchange this year. Korea Exchange plans to make special changes to the Korea Value-Up Index constituents on 20 December. 


A Review of Major Equity Indices in Korea in 2024

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

<ul>
<li>The review period for the September rebalance of the KOSPI Size Indices commenced on 1 June and will end on 31 August. Only 4 trading days to go.</li>
<li>We see 7 migrations from MidCap to LargeCap, 1 new addition to LargeCap, 12 stocks moving from SmallCap to MidCap and 3 new additions to MidCap.</li>
<li>The upward migrations have underperformed the downward migrations over the last month as a few stocks have sold off hard. Some despite being included in global indices.</li>
</ul>


The review period for the September rebalance of the KOSPI Size Indices commenced on 1 June and will end on 31 August. Only 4 trading days to go.
We see 7 migrations from MidCap to LargeCap, 1 new addition to LargeCap, 12 stocks moving from SmallCap to MidCap and 3 new additions to MidCap.
The upward migrations have underperformed the downward migrations over the last month as a few stocks have sold off hard. Some despite being included in global indices.


KOSPI Size Indices: Momentum Stalls; (Some) Upward Migrations Sell-Off

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>The Aussie Tax-Loss Selling Baskets worked very well on the sell side from 30 April through end-June 2024. What now?  Unwind.</li>
<li>
<a href="https://www.smartkarma.com/entities/ck-infrastructure-holdings-l" target="_blank" data-smartkarma-citation="entities:163:1" rel="noopener">CK Infrastructure Holdings (1038 HK)</a> has now submitted an application for a secondary listing, not a dual-primary listing, on the London stock exchange. Admission expected on the 19th August. </li>
<li>The right trade is to buy <a href="https://www.smartkarma.com/entities/jtower-inc" target="_blank" data-smartkarma-citation="entities:31042:1" rel="noopener">JTower (4485 JP)</a> below terms. The really right trade is to already be an owner. IF you're an arbitrageur, you know what to do.</li>
</ul>


The Aussie Tax-Loss Selling Baskets worked very well on the sell side from 30 April through end-June 2024. What now?  Unwind.

CK Infrastructure Holdings (1038 HK) has now submitted an application for a secondary listing, not a dual-primary listing, on the London stock exchange. Admission expected on the 19th August. 
The right trade is to buy JTower (4485 JP) below terms. The really right trade is to already be an owner. IF you're an arbitrageur, you know what to do.


Last Week in Event SPACE: Aussie Tax Loss Basket, CK Infra, JTower, Porsche

South Korea

Hanon Systems manufactures a variety of automotive air control equipment.  The Company's products include air conditioners, heaters, cooling modules, compressors, radiators, fans, evaporators, and condensers. Hanon Systems distributes its products on an original equipment manufacturing (OEM) basis.

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Hanon Systems (018880 KS)