Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>The 2023 Version of <strong>JAPAN PASSIVE: Who Owns What?</strong> where we break down the major (and minor) passive tracking indices and which category of investor owns how much of each. </li>
<li>Even if you do not "play" index changes, understanding impact is important. Advantest is up 100% in 3mos. Existing passive ownership and new passive buying were crucial to that performance.</li>
<li>Understanding the nature of the ownership and flows is crucial to understanding how to trade certain stocks in Japan. </li>
</ul>


The 2023 Version of JAPAN PASSIVE: Who Owns What? where we break down the major (and minor) passive tracking indices and which category of investor owns how much of each. 
Even if you do not "play" index changes, understanding impact is important. Advantest is up 100% in 3mos. Existing passive ownership and new passive buying were crucial to that performance.
Understanding the nature of the ownership and flows is crucial to understanding how to trade certain stocks in Japan. 


APAC IPOs & Placements, Aequitas Research

Ethan Aw

APAC 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

Horizon Construction Development / Equity Capital Markets

Horizon Construction Development (1887128D HK)

<ul>
<li>
<a href="https://www.smartkarma.com/entities/horizon-construction-development" target="_blank" data-smartkarma-citation="entities:35117:1" rel="noopener">Horizon Construction Development (1887128D HK)</a> raised around US$210m in its Hong Kong IPO.</li>
<li>HCD is an equipment operation service provider in China. It provides services covering the full cycle of projects.</li>
<li>In this note, we will talk about the trading dynamics and valuation.</li>
</ul>



Horizon Construction Development (1887128D HK) raised around US$210m in its Hong Kong IPO.
HCD is an equipment operation service provider in China. It provides services covering the full cycle of projects.
In this note, we will talk about the trading dynamics and valuation.


Horizon Construction Dev IPO Trading - Subscription Rates Still Weak, Despite Cornerstone Support

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

Index Rebalance

<ul>
<li>The review period for the <a href="https://www.smartkarma.com/entities/nikkei-225" target="_blank" data-smartkarma-citation="entities:22909:1" rel="noopener">Nikkei 225 (NKY INDEX)</a> March rebalance ends next week. We highlight the 3 potential inclusions and exclusions for the index.</li>
<li>
<a href="https://www.smartkarma.com/entities/lasertec-corp" target="_blank" data-smartkarma-citation="entities:4126:1" rel="noopener">Lasertec Corp (6920)</a>, <a href="https://www.smartkarma.com/entities/oriental-land-co-ltd" target="_blank" data-smartkarma-citation="entities:13517:1" rel="noopener">Oriental Land (4661)</a> and <a href="https://www.smartkarma.com/entities/renesas-electronics-corp" target="_blank" data-smartkarma-citation="entities:15933:1" rel="noopener">Renesas Electronics (6723)</a> remain our top inclusions, while <a href="https://www.smartkarma.com/entities/toyobo-co-ltd" target="_blank" data-smartkarma-citation="entities:6187:1" rel="noopener">Toyobo Co Ltd (3101)</a>, <a href="https://www.smartkarma.com/entities/nippon-light-metal-holdings" target="_blank" data-smartkarma-citation="entities:1485:1" rel="noopener">Nippon Light Metal (5703)</a> and <a href="https://www.smartkarma.com/entities/toho-zinc-co-ltd" target="_blank" data-smartkarma-citation="entities:2796:1" rel="noopener">Toho Zinc (5707)</a> could be deleted.</li>
<li>Due to the large size difference between the potential adds/deletes, there will be a large funding trade with passive trackers needing to sell over 1x ADV on many index constituents.</li>
</ul>


The review period for the Nikkei 225 (NKY INDEX) March rebalance ends next week. We highlight the 3 potential inclusions and exclusions for the index.

Lasertec Corp (6920), Oriental Land (4661) and Renesas Electronics (6723) remain our top inclusions, while Toyobo Co Ltd (3101), Nippon Light Metal (5703) and Toho Zinc (5707) could be deleted.
Due to the large size difference between the potential adds/deletes, there will be a large funding trade with passive trackers needing to sell over 1x ADV on many index constituents.


Nikkei 225 Index Rebalance Preview (March): Potential Changes as Review Period Nears End

Shinko Electric Industries / Event-Driven

<ul>
<li>Three years ago I wrote <a href="https://www.smartkarma.com/insights/fujitsu-subsidiary-selldowns-or-buy-ins" target="_blank" data-smartkarma-citation="insights:35032" rel="noopener">Fujitsu Subsidiary Selldowns or Buy-Ins?</a> My choice then was Fujitsu Frontech which was bought out 8 months later. </li>
<li>A Bloomberg article today with quotes from an interview with the CEO of Fujitsu fuelled some movement today. </li>
<li>The "obvious" trade is <a href="https://www.smartkarma.com/entities/shinko-electric-industries" target="_blank" data-smartkarma-citation="entities:15066:1" rel="noopener">Shinko Electric Industries (6967 JP)</a> but you have to buy the new dream.</li>
</ul>


Three years ago I wrote Fujitsu Subsidiary Selldowns or Buy-Ins? My choice then was Fujitsu Frontech which was bought out 8 months later. 
A Bloomberg article today with quotes from an interview with the CEO of Fujitsu fuelled some movement today. 
The "obvious" trade is Shinko Electric Industries (6967 JP) but you have to buy the new dream.


Fujitsu (6702) Subsidiary Selldowns To Come

<ul>
<li>
<a href="https://www.smartkarma.com/entities/hitachi-transport-system-ltd" target="_blank" data-smartkarma-citation="entities:2395:1" rel="noopener">Hitachi Transport System (9086 JP)</a> has had a "long" wait to get its approvals, but EC and China are in, any remaining should be in shortly. </li>
<li>Yesterday, as a footnote on the SG Holdings offering document, there was a comment about SG Holdings selling shares. This was likely more good corporate governance hygiene than warning.</li>
<li>Shares are down this morning. I'd expect final approvals and launch quite soon. I would therefore look to buy the dip on flow - block or not.</li>
</ul>



Hitachi Transport System (9086 JP) has had a "long" wait to get its approvals, but EC and China are in, any remaining should be in shortly. 
Yesterday, as a footnote on the SG Holdings offering document, there was a comment about SG Holdings selling shares. This was likely more good corporate governance hygiene than warning.
Shares are down this morning. I'd expect final approvals and launch quite soon. I would therefore look to buy the dip on flow - block or not.


Hitachi Transport (9086 JP) - Tender Launch Likely Soon But Watch for Flow

Japan

Hitachi Construction Machinery Co., Ltd. develops, manufactures, sells, and repairs construction machinery. The Company's products include hydraulic excavators, crawler cranes, wheel loaders, shield machines, and bulldozers. Hitachi Construction Machinery, a subsidiary of Hitachi, Ltd., markets its products worldwide through sales offices overseas.

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Hitachi Construction Machinery (6305 JP)

JAPAN PASSIVE: Who Owns What 2023?

This is the annual JAPAN PASSIVE: Who Owns What report for 2023. It is a comprehensive of the major index exposures in Japan by index tracker type,...

Travis Lundy

Horizon Construction Dev IPO Trading - Subscription Rates Still Weak, Despite Cornerstone Support

Horizon Construction Development (1887128D HK) raised around US$210m in its Hong Kong IPO. In this note, we will talk about the trading dynamics...

Ethan Aw

Nikkei 225 Index Rebalance Preview (March): Potential Changes as Review Period Nears End

With a week left in the review period, we revisit the potential NKY changes in March & highlight top add/delete candidates. There will be a large...

Brian Freitas

Fujitsu (6702) Subsidiary Selldowns To Come

A Bloomberg article on Fujitsu selling non-core subs was out today. Nothing new, but there is some nuance. I present a small review, and conclude...

Travis Lundy

Hitachi Transport (9086 JP) - Tender Launch Likely Soon But Watch for Flow

Hitachi Transport should be in final stages. The two tough approvals were done a month ago. The Russia sub should not be a factor (it could be sold...

Travis Lundy

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