Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Index Rebalance

<ul>
<li>Yesterday, the Nikkei Index Committee announced the results of the March 2026 review of the Nikkei 225 Average. We got the two ADDs right, but not the two DELETEs.</li>
<li>The choice of the DELETEs appear to have solidified a practice which informs going forward. Expect more Tech deletions.</li>
<li>Kioxia (285A) IN, Pan Pacific International HD (7532) IN. GS Yuasa (6674) and Casio (6952) OUT. Advantest capped. US$1.2bn Reverse Funding. And crowded end-March flows.</li>
</ul>


Yesterday, the Nikkei Index Committee announced the results of the March 2026 review of the Nikkei 225 Average. We got the two ADDs right, but not the two DELETEs.
The choice of the DELETEs appear to have solidified a practice which informs going forward. Expect more Tech deletions.
Kioxia (285A) IN, Pan Pacific International HD (7532) IN. GS Yuasa (6674) and Casio (6952) OUT. Advantest capped. US$1.2bn Reverse Funding. And crowded end-March flows.


[Quiddity Index] Nikkei 225 Mar-2026 Rebal: Kioxia, PPIH IN, Casio GS Yuasa OUT. Big End-Mar Flows.

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>
<a href="https://www.smartkarma.com/entities/kioxia-holdings-corp" target="_blank" data-smartkarma-citation="entities:29243:1" rel="noopener">Kioxia Holdings (285A JP)</a> and <a href="https://www.smartkarma.com/entities/pan-pacific-international-holdings-corporation" target="_blank" data-smartkarma-citation="entities:13475:1" rel="noopener">Pan Pacific International (7532 JP)</a> will replace <a href="https://www.smartkarma.com/entities/gs-yuasa-corp" target="_blank" data-smartkarma-citation="entities:8298:1" rel="noopener">Gs Yuasa (6674 JP)</a> and <a href="https://www.smartkarma.com/entities/casio-computer-co-ltd" target="_blank" data-smartkarma-citation="entities:18338:1" rel="noopener">Casio Computer (6952 JP)</a> in the <a href="https://www.smartkarma.com/entities/nikkei-225" target="_blank" data-smartkarma-citation="entities:22909:1" rel="noopener">Nikkei 225 INDEX</a> at the March rebalance.</li>
<li>The index committee finally appears to be restoring sector balance with an extra deletion from the overweight Technology sector and an inclusion from the underweight Consumer Goods sector.</li>
<li>
<a href="https://www.smartkarma.com/entities/advantest-corp" target="_blank" data-smartkarma-citation="entities:18107:1" rel="noopener">Advantest Corp (6857 JP)</a>'s capping will result in big inflows to the other index constituents. At current levels, the stock will be capped again at the September rebalance. </li>
</ul>



Kioxia Holdings (285A JP) and Pan Pacific International (7532 JP) will replace Gs Yuasa (6674 JP) and Casio Computer (6952 JP) in the Nikkei 225 INDEX at the March rebalance.
The index committee finally appears to be restoring sector balance with an extra deletion from the overweight Technology sector and an inclusion from the underweight Consumer Goods sector.

Advantest Corp (6857 JP)'s capping will result in big inflows to the other index constituents. At current levels, the stock will be capped again at the September rebalance. 


Nikkei 225 Index Rebalance: Kioxia, Pan Pacific IN; GS Yuasa, Casio Computer OUT

Head of Research, Krungthai XSpring

Waraporn Wiboonkanarak

Head of Research

A full service Thai brokerage

Krungthai XSpring

Krungthai XSpring is a full service broker. The company provides a wide range of investment services such as Securities Brokerage, Derivative Agent Business, Securities Borrowing and Lending, Securities Trading, Underwriting, Financial Advisory, Wealth Advisory, Private Fund Management and International Markets Securities Trading. 

In terms of credibility, Fitch Ratings has assigned Krunghtai XSpring a long-term rating of AA- and a national short-term rating of F1+ with stable outlook.

Equity Bottom-Up

Somboon Advance Technology / Equity Bottom-Up

<ul><li>We view SAT as the most exposed to the US–Iran conflict, given its key customers (Toyota, Mitsubishi) have the highest export exposure to the Middle East.</li><li>If the situation in the Middle East is prolonged, we expect SAT's profit to have a downside of approximately 4%, to Bt775mn (+6% YoY).</li><li>SAT is a safe stock for investors seeking high dividend returns, with a yield of up to 11% per year. As the share price has corrected after the Bt1.20/share dividend payout, it has begun to offer attractive upside. We therefore upgrade our recommendation from Neutral to Outperform with an unchanged fair value of Bt16.</li></ul>

We view SAT as the most exposed to the US–Iran conflict, given its key customers (Toyota, Mitsubishi) have the highest export exposure to the Middle East.If the situation in the Middle East is prolonged, we expect SAT's profit to have a downside of approximately 4%, to Bt775mn (+6% YoY).SAT is a safe stock for investors seeking high dividend returns, with a yield of up to 11% per year. As the share price has corrected after the Bt1.20/share dividend payout, it has begun to offer attractive upside. We therefore upgrade our recommendation from Neutral to Outperform with an unchanged fair value of Bt16.

SOMBOON ADVANCE TECHNOLOGY Plc. (SAT): Short-Term Risks, Long-Term Appeal Driven by Dividends

Event-Driven

<ul>
<li>Toyota Asset Preparatory Co today extended its tender for <a href="https://www.smartkarma.com/entities/toyota-industries-corp" target="_blank" data-smartkarma-citation="entities:4500:1" rel="noopener">Toyota Industries (6201 JP)</a> til 2 March. They indicated 33.1% had tendered as of 1pm. That suggests 95+% of minorities hadn't.</li>
<li>It repeated its statement that it is paying full intrinsic value for the company. I think that is patently, demonstrably false. If they think so, they are the wrong buyer.</li>
<li>Shares popped after the news. They reiterated they had no intention to pay more. That's par for the course. I expect they may bid up, but still not get it.</li>
</ul>


Toyota Asset Preparatory Co today extended its tender for Toyota Industries (6201 JP) til 2 March. They indicated 33.1% had tendered as of 1pm. That suggests 95+% of minorities hadn't.
It repeated its statement that it is paying full intrinsic value for the company. I think that is patently, demonstrably false. If they think so, they are the wrong buyer.
Shares popped after the news. They reiterated they had no intention to pay more. That's par for the course. I expect they may bid up, but still not get it.


[Japan M&A/Activism] Toyota RE Deal for TICO (6201) Extended. VERY Few Minorities Have Tendered.

<ul>
<li>Assuming the Nikkei 225 March 2026 rebal goes as expected in our <a href="https://www.smartkarma.com/insights/quiddity-index-nikkei-225-mar26-rebal-2-adds-3rd-poss-2-dels-1-cap-another-close" target="_blank" rel="noopener">final expectations insight</a>, there are likely to be two automatic ADDs and one sector catch-up ADD.</li>
<li>Higher value traded in the last 6-12mos in the semis and semi-precious metals sectors has meant stocks leapt up the rankings.</li>
<li>Interestingly, the third choice is likely to be a Capital Goods stock. If the Toyota Fudosan TOB fails, there is a dark horse case for <a href="https://www.smartkarma.com/entities/toyota-industries-corp" target="_blank" data-smartkarma-citation="entities:4500:1" rel="noopener">Toyota Industries (6201 JP)</a>.</li>
</ul>


Assuming the Nikkei 225 March 2026 rebal goes as expected in our final expectations insight, there are likely to be two automatic ADDs and one sector catch-up ADD.
Higher value traded in the last 6-12mos in the semis and semi-precious metals sectors has meant stocks leapt up the rankings.
Interestingly, the third choice is likely to be a Capital Goods stock. If the Toyota Fudosan TOB fails, there is a dark horse case for Toyota Industries (6201 JP).


[Quiddity Index] Nikkei 225 Sep26 Rebal Early Preview - 2 Auto ADDs, 1 Extra Likely, 1 Cap

Japan

HINO MOTORS, LTD. develops, manufactures and markets diesel buses and trucks. The Company also produces heavy duty trucks, special purpose vehicles, and diesel engines for industrial and marine applications.

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Hino Motors Ltd (7205 JP)

[Quiddity Index] Nikkei 225 Mar-2026 Rebal: Kioxia, PPIH IN, Casio GS Yuasa OUT. Big End-Mar Flows.

The Nikkei 225 Rebal is today at the close. Since the announcement of the March review names, Kioxia is down 1+% to yesterday's close, but saw a...

Travis Lundy

Nikkei 225 Index Rebalance: Kioxia, Pan Pacific IN; GS Yuasa, Casio Computer OUT

The Nikkei225 March rebalance will be executed at the close today. The adds have started to trade lower and the deletes are trading higher since...

Brian Freitas

SOMBOON ADVANCE TECHNOLOGY Plc. (SAT): Short-Term Risks, Long-Term Appeal Driven by Dividends

We view SAT as the most exposed to the US–Iran conflict, given its key customers (Toyota, Mitsubishi) have the highest export exposure to the...

Krungthai XSpring

[Japan M&A/Activism] Toyota RE Deal for TICO (6201) Extended. VERY Few Minorities Have Tendered.

Toyota Asset Preparatory has extended its Tender Offer for TICO. TICO popped on the news, breaking ¥20,000. I'm surprised it isn't a bit higher...

Travis Lundy

[Quiddity Index] Nikkei 225 Sep26 Rebal Early Preview - 2 Auto ADDs, 1 Extra Likely, 1 Cap

A preview of teh Sep 2026 Nikkei 225 rebal assuming changes are as expected for the Mar26 rebal suggests 3 ADDs and 3 DELETEs and $4bn of Advantest...

Travis Lundy

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