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

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Index Rebalance

<p>The KRX has announced the list of inclusions and exclusions to the KOSDAQ150 Index today. The rebalance is effective after the close of trading on 10 December.</p><p>There are 17 inclusions and 17 exclusions in the December 2020 review with an estimated one-way turnover of 7.71%.</p><p>The inclusions and exclusions are:</p><table class="table table-striped">
<colgroup><col span="4"></colgroup>
<tbody>
<tr>
<td colspan="2" style="text-align: center; width: 96pt;"><h3>Additions</h3></td>
<td colspan="2" style="text-align: center; width: 96pt;"><h3>Deletions</h3></td>
</tr>
<tr>
<td style="text-align: center;"><strong>Code</strong></td>
<td style="text-align: center;"><strong>Name</strong></td>
<td style="text-align: center;"><strong>Code</strong></td>
<td style="text-align: center;"><strong>Name</strong></td>
</tr>
<tr>
<td>034950.KQ</td>
<td>Korea Ratings Corp</td>
<td>014620.KQ</td>
<td>Sung Kwang Bend Co Ltd</td>
</tr>
<tr>
<td>078600.KQ</td>
<td>Daejoo Electronic Materials Co Ltd</td>
<td>015750.KQ</td>
<td>Sungwoo Hitech Co Ltd</td>
</tr>
<tr>
<td>089980.KQ</td>
<td>Sang-A Frontec Co Ltd</td>
<td>023160.KQ</td>
<td>TK Corp</td>
</tr>
<tr>
<td>092190.KQ</td>
<td>Seoul Viosys Co Ltd</td>
<td>039840.KQ</td>
<td>Dio Corp</td>
</tr>
<tr>
<td>100130.KQ</td>
<td>Dongkuk Structures &amp; Construction Co Ltd</td>
<td>041190.KQ</td>
<td>Woori Technology Investment Co Ltd</td>
</tr>
<tr>
<td>101490.KQ</td>
<td>S&amp;S Tech Corp</td>
<td>041830.KQ</td>
<td>InBody Co Ltd</td>
</tr>
<tr>
<td>131370.KQ</td>
<td>Rsupport Co Ltd</td>
<td>043150.KQ</td>
<td>Value Added Technology Co Ltd</td>
</tr>
<tr>
<td>137400.KQ</td>
<td>People &amp; Technology Inc</td>
<td>047310.KQ</td>
<td>Power Logics</td>
</tr>
<tr>
<td>194700.KQ</td>
<td>Novarex Co Ltd</td>
<td>049950.KQ</td>
<td>MeereCompany Inc</td>
</tr>
<tr>
<td>204270.KQ</td>
<td>JNTC Co Ltd</td>
<td>051500.KQ</td>
<td>CJ Freshway Corp</td>
</tr>
<tr>
<td>222080.KQ</td>
<td>Creative &amp; Innovative System Corp</td>
<td>063570.KQ</td>
<td>Nice Total Cash Management Co Ltd</td>
</tr>
<tr>
<td>235980.KQ</td>
<td>MedPacto Inc</td>
<td>080160.KQ</td>
<td>Modetour Network Inc</td>
</tr>
<tr>
<td>290510.KQ</td>
<td>KoreaCenter Co Ltd</td>
<td>084110.KQ</td>
<td>Huons Global Co Ltd</td>
</tr>
<tr>
<td>290650.KQ</td>
<td>L&amp;C Bio Co Ltd</td>
<td>089600.KQ</td>
<td>Nasmedia Co Ltd</td>
</tr>
<tr>
<td>293490.KQ</td>
<td>Kakao Games Corp</td>
<td>115960.KQ</td>
<td>Yonwoo Co Ltd</td>
</tr>
<tr>
<td>294140.KQ</td>
<td>Lemon Co Ltd</td>
<td>228760.KQ</td>
<td>Genomictree Inc</td>
</tr>
<tr>
<td>357780.KQ</td>
<td>SoulBrain Co Ltd</td>
<td>282880.KQ</td>
<td>CowinTech Co Ltd</td>
</tr>
</tbody>
</table><p>There are 11 trading days to implementation. There are 2 additions that have more than 3 days of ADV to trade while there are 9 deletions that have more than 3 days of ADV to trade. Things could get interesting over the next couple of weeks.</p>

The KRX has announced the list of inclusions and exclusions to the KOSDAQ150 Index today. The rebalance is effective after the close of trading on 10 December.There are 17 inclusions and 17 exclusions in the December 2020 review with an estimated one-way turnover of 7.71%.The inclusions and exclusions are:



Additions
Deletions


Code
Name
Code
Name


034950.KQ
Korea Ratings Corp
014620.KQ
Sung Kwang Bend Co Ltd


078600.KQ
Daejoo Electronic Materials Co Ltd
015750.KQ
Sungwoo Hitech Co Ltd


089980.KQ
Sang-A Frontec Co Ltd
023160.KQ
TK Corp


092190.KQ
Seoul Viosys Co Ltd
039840.KQ
Dio Corp


100130.KQ
Dongkuk Structures &amp; Construction Co Ltd
041190.KQ
Woori Technology Investment Co Ltd


101490.KQ
S&amp;S Tech Corp
041830.KQ
InBody Co Ltd


131370.KQ
Rsupport Co Ltd
043150.KQ
Value Added Technology Co Ltd


137400.KQ
People &amp; Technology Inc
047310.KQ
Power Logics


194700.KQ
Novarex Co Ltd
049950.KQ
MeereCompany Inc


204270.KQ
JNTC Co Ltd
051500.KQ
CJ Freshway Corp


222080.KQ
Creative &amp; Innovative System Corp
063570.KQ
Nice Total Cash Management Co Ltd


235980.KQ
MedPacto Inc
080160.KQ
Modetour Network Inc


290510.KQ
KoreaCenter Co Ltd
084110.KQ
Huons Global Co Ltd


290650.KQ
L&amp;C Bio Co Ltd
089600.KQ
Nasmedia Co Ltd


293490.KQ
Kakao Games Corp
115960.KQ
Yonwoo Co Ltd


294140.KQ
Lemon Co Ltd
228760.KQ
Genomictree Inc


357780.KQ
SoulBrain Co Ltd
282880.KQ
CowinTech Co Ltd


There are 11 trading days to implementation. There are 2 additions that have more than 3 days of ADV to trade while there are 9 deletions that have more than 3 days of ADV to trade. Things could get interesting over the next couple of weeks.

KOSDAQ150 Index Rebalance: Lots of Changes, Big Turnover, High Impact

<p>The Korea Exchange (KRX) will announce the results of the December 2020 review of the KOSDAQ150 Index in the second half of November. The constituent changes will be effective from the open on 11 December 2020 and the rebalancing trades will need to be done at the closing auction on 10 December 2020.</p><p>The review covers the period from 1 May to 31 October. We have gone through 120 trading days and there are only 3 days remaining in the review period. Since the data is averaged, there is a very small possibility of the names changing over the next few days.</p><p>At the current time, we see 16 potential inclusions and exclusions with a one-way turnover of 6.94%. This includes the fast entry inclusion of <a href="https://www.smartkarma.com/entities/kakao-games-corp" target="_blank" data-smartkarma-citation="entities:26730:1" rel="noopener">Kakao Games (293490 KS)</a>.</p><p>The expected inclusions have outperformed the expected deletions since the start of the review period but have given up a significant part of the gains over the last couple of months. With short selling still banned, there could be another period of outperformance prior to the announcement with continuation leading up to implementation date.</p>

The Korea Exchange (KRX) will announce the results of the December 2020 review of the KOSDAQ150 Index in the second half of November. The constituent changes will be effective from the open on 11 December 2020 and the rebalancing trades will need to be done at the closing auction on 10 December 2020.The review covers the period from 1 May to 31 October. We have gone through 120 trading days and there are only 3 days remaining in the review period. Since the data is averaged, there is a very small possibility of the names changing over the next few days.At the current time, we see 16 potential inclusions and exclusions with a one-way turnover of 6.94%. This includes the fast entry inclusion of Kakao Games (293490 KS).The expected inclusions have outperformed the expected deletions since the start of the review period but have given up a significant part of the gains over the last couple of months. With short selling still banned, there could be another period of outperformance prior to the announcement with continuation leading up to implementation date.

KOSDAQ150 Index Rebalance Preview: Reversion Sets Up an Attractive Entry Point

Daejoo Electronic Materials / Index Rebalance

<p>The Korea Exchange (KRX) will announce the results of the December 2020 review of the KOSDAQ150 Index in November. The constituent changes will be effective from 11 December 2020 and the rebalancing trades will need to be done at the closing auction on 10 December 2020.</p><p>The review period for the December rebalance runs from 1 May to 31 October. At the current time, we see 15 stocks being added to and deleted from the index. This is up from the 11 names we saw being included/ excluded at the end of June. With the index methodology using a 6 month average, the list should be a lot more stable going forward.</p><p>The expected inclusions have outperformed the expected exclusions, and the KOSDAQ150 index, by a wide margin over the last 4 months. With the short sell ban extended to 15 March 2021, the expected inclusions could continue to run up as investors chase momentum.</p>

The Korea Exchange (KRX) will announce the results of the December 2020 review of the KOSDAQ150 Index in November. The constituent changes will be effective from 11 December 2020 and the rebalancing trades will need to be done at the closing auction on 10 December 2020.The review period for the December rebalance runs from 1 May to 31 October. At the current time, we see 15 stocks being added to and deleted from the index. This is up from the 11 names we saw being included/ excluded at the end of June. With the index methodology using a 6 month average, the list should be a lot more stable going forward.The expected inclusions have outperformed the expected exclusions, and the KOSDAQ150 index, by a wide margin over the last 4 months. With the short sell ban extended to 15 March 2021, the expected inclusions could continue to run up as investors chase momentum.

KOSDAQ150 Index Rebalance Preview: Strong Momentum Driving Gains

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Capital Markets

<p>After the market close today, it was reported that BK Medical Group’s Chairman Dr. Kim Byung-Gun and Dr. BK Corp will sell their <strong>5.2% stake in <a href="https://www.smartkarma.com/entities/hugel-inc" target="_blank" data-smartkarma-citation="entities:22860:1" rel="noopener">Hugel Inc (145020 KS)</a> (224,781 shares), w</strong>hich currently has a market cap of 2.2 trillion won. Assuming a 7% discount to today's closing price of 518,200 won, this would represent <strong>108 billion won ($90 million).</strong> The block deal discount rate is 7-10%. The lead manager on this placement is NH Investment &amp; Securities.</p><div class="content-highlight"><p><em><strong>Conclusion: </strong>We would avoid this placement of Hugel mainly because we believe the sharp appreciation of Hugel's shares in the past two weeks probably already reflect the increasing market share of BOTOX products in Korea as a result of the Ministry of Food and Drug Safety's cancellation of the permit (to sell) Medy Tox's Medytoxin BOTOX product. At current prices, Hugel's shares are trading at nearly 40x P/E (2021), which are relatively high valuations. Plus, despite the market share gains by Hugel from Medy Tox, the other competing players including Daewoong Pharm are also likely to take away market share in the BOTOX segment.</em></p></div>

After the market close today, it was reported that BK Medical Group’s Chairman Dr. Kim Byung-Gun and Dr. BK Corp will sell their 5.2% stake in Hugel Inc (145020 KS) (224,781 shares), which currently has a market cap of 2.2 trillion won. Assuming a 7% discount to today's closing price of 518,200 won, this would represent 108 billion won ($90 million). The block deal discount rate is 7-10%. The lead manager on this placement is NH Investment &amp; Securities.Conclusion: We would avoid this placement of Hugel mainly because we believe the sharp appreciation of Hugel's shares in the past two weeks probably already reflect the increasing market share of BOTOX products in Korea as a result of the Ministry of Food and Drug Safety's cancellation of the permit (to sell) Medy Tox's Medytoxin BOTOX product. At current prices, Hugel's shares are trading at nearly 40x P/E (2021), which are relatively high valuations. Plus, despite the market share gains by Hugel from Medy Tox, the other competing players including Daewoong Pharm are also likely to take away market share in the BOTOX segment.

Event-Driven

<p>The Korea Exchange (KRX) will announce the results of the June 2020 review of the KOSDAQ 150 index in May. The constituent changes will be effective from 12 June 2020 and the rebalancing trades will need to be done at the closing auction on 11 June 2020.</p><p>Following on from our earlier Insight, <a href="https://www.smartkarma.com/insights/kosdaq150-rebalance-preview-stocks-starting-to-move" target="_blank" rel="noopener" data-smartkarma-citation="insights:36461">KOSDAQ150 Rebalance Preview - Stocks Starting to Move</a>, we refresh our list of inclusions and exclusions using the latest market data and find one more change from our earlier list.</p><p>We currently see 10 inclusions and exclusions in the KOSDAQ150 in the upcoming review and the high conviction inclusions continue to outperform the high conviction exclusions and the KOSDAQ150 index.</p>

The Korea Exchange (KRX) will announce the results of the June 2020 review of the KOSDAQ 150 index in May. The constituent changes will be effective from 12 June 2020 and the rebalancing trades will need to be done at the closing auction on 11 June 2020.Following on from our earlier Insight, KOSDAQ150 Rebalance Preview - Stocks Starting to Move, we refresh our list of inclusions and exclusions using the latest market data and find one more change from our earlier list.We currently see 10 inclusions and exclusions in the KOSDAQ150 in the upcoming review and the high conviction inclusions continue to outperform the high conviction exclusions and the KOSDAQ150 index.

KOSDAQ150 Rebalance Preview - Tracking Changes

South Korea

Huons Co., Ltd. manufactures pharmaceutical products.  The Company produces medical drugs in the fields of nervous system, sensory organs, anti-histamines, circulatory system, respiratory system, digestive system, metabolic agents and hormones.

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Huons Global (084110 KS)

KOSDAQ150 Index Rebalance: Lots of Changes, Big Turnover, High Impact

There are 17 changes to the KOSDAQ150 index and the turnover is estimated at 7.71%. There are a lot of stocks that have over 3 days of ADV to trade...

Brian Freitas

KOSDAQ150 Index Rebalance Preview: Reversion Sets Up an Attractive Entry Point

With 16 possible changes to the KOSDAQ150 in the Dec review with a one-way turnover of 7%, the recent underperformance of the inclusions vs the...

Brian Freitas

KOSDAQ150 Index Rebalance Preview: Strong Momentum Driving Gains

The Korea Exchange (KRX) will announce the results of the December 2020 review of the KOSDAQ150 Index in November. The constituent changes will be...

Brian Freitas

Hugel Placement: A 5.2% Block Deal Sale

After the market close today, it was reported that BK Medical Group’s Chairman Dr. Kim Byung-Gun and Dr. BK Corp will sell their 5.2% stake...

Douglas Kim

KOSDAQ150 Rebalance Preview - Tracking Changes

The Korea Exchange (KRX) will announce the results of the June 2020 review of the KOSDAQ 150 index in May. The constituent changes will be...

Brian Freitas

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