Index Rebal Trades & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal Trades & Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Index Rebalance

<ul>
<li>The HSTECH Index tracks the performance of the top 30 technology companies listed in Hong Kong that have high business exposure to certain technology themes. </li>
<li>In this insight, we take a look at the rankings of potential ADDs and potential DELs for the June 2025 index rebal event.</li>
<li>We see zero index changes based on the latest available data but we estimate there to be US$204mn one-way flows due to capping.</li>
</ul>


The HSTECH Index tracks the performance of the top 30 technology companies listed in Hong Kong that have high business exposure to certain technology themes. 
In this insight, we take a look at the rankings of potential ADDs and potential DELs for the June 2025 index rebal event.
We see zero index changes based on the latest available data but we estimate there to be US$204mn one-way flows due to capping.


Quiddity Leaderboard HSTECH Jun25: US$204mn One-Way; No Index Changes Likely

Derivatives and Quantitative Strategist

Gaudenz Schneider

Equity Derivatives

<ul>
<li>
<a href="https://www.smartkarma.com/entities/jd-com-inc" target="_blank" data-smartkarma-citation="entities:29043:1" rel="noopener">JD.com (9618 HK)</a> Q4 2024 earnings significantly exceeded analyst expectations with revenue reaching RMB 347 billion (13.4% YoY increase).</li>
<li>The stock experienced a volatile two-day reaction, rising 8.4% on March 6 followed by a 5.0% decline on March 7, resulting in a net gain of 3.03%.</li>
<li>Options strategies including straddles, strangles, and call calendar spreads were actively traded ahead of earnings with potential intraday profitability. Longer dated implied volatility decreased following the announcement.</li>
</ul>



JD.com (9618 HK) Q4 2024 earnings significantly exceeded analyst expectations with revenue reaching RMB 347 billion (13.4% YoY increase).
The stock experienced a volatile two-day reaction, rising 8.4% on March 6 followed by a 5.0% decline on March 7, resulting in a net gain of 3.03%.
Options strategies including straddles, strangles, and call calendar spreads were actively traded ahead of earnings with potential intraday profitability. Longer dated implied volatility decreased following the announcement.


JD.com (9618 HK) FY Earnings Recap: Intra-Day Swing of 7.3%.

Blue Lotus Non US Internet research, Blue Lotus Research Institute

Ying Pan

Blue Lotus Non US Internet research

China growth and global non-US Internet equities

Blue Lotus Research Institute

Blue Lotus Research is a Hong Kong Type 4 Licensed investment advisory firm focusing on Chinese growth equities and global non-US Internet equities

Equity Bottom-Up

<ul>
<li>JD C4Q24 revenue exceeded our estimate/consensus by 3%/4% and adjusted NI by 16%/19%, driven by subsidies and logistic efficiency gains.</li>
<li>We expect JD to maintain 11% YoY revenue growth in C1H25 but moderate to 5.9% in 2H. </li>
<li>We maintain JD.com's TP at US$ 52 and the BUY rating. Market concern on lack of details for long term driver is valid but JD.com still has time.</li>
</ul>


JD C4Q24 revenue exceeded our estimate/consensus by 3%/4% and adjusted NI by 16%/19%, driven by subsidies and logistic efficiency gains.
We expect JD to maintain 11% YoY revenue growth in C1H25 but moderate to 5.9% in 2H. 
We maintain JD.com's TP at US$ 52 and the BUY rating. Market concern on lack of details for long term driver is valid but JD.com still has time.


[JD.com, Inc (JD US, BUY, TP US$52) Earnings Review]: Market Calls for Longer-Term Growth Drivers

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 December rebalance of the Hang Seng family of indices will use today's closing prices to cap the index constituent weights.</li>
<li>The net round-trip trade across all stocks across the five indices is estimated at HK$50bn (US$6.4bn). There is size to trade in a lot of stocks.</li>
<li>
<a href="https://www.smartkarma.com/entities/xiaomi-corp" target="_blank" data-smartkarma-citation="entities:24409:1" rel="noopener">Xiaomi (1810 HK)</a> is the biggest buy due to HSIII Index inclusion and capping, while <a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd-d7b798e2-202d-4e01-9a1e-799e2ae8f0c7" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba (9988 HK)</a> is the biggest capping sell.</li>
</ul>


The December rebalance of the Hang Seng family of indices will use today's closing prices to cap the index constituent weights.
The net round-trip trade across all stocks across the five indices is estimated at HK$50bn (US$6.4bn). There is size to trade in a lot of stocks.

Xiaomi (1810 HK) is the biggest buy due to HSIII Index inclusion and capping, while Alibaba (9988 HK) is the biggest capping sell.


HSI, HSCEI, HSTECH, HSIII, HSBIO Index Rebalance: US$6.4bn of Flows Post Capping (Dec 2025)

<ul>
<li>We expect JD.com C4Q24 revenue/non-GAAP NI to be RMB337bn/9.7bn, 1.6%/6.5% above consensus, benefiting from trade-in subsidies and logistics;</li>
<li>With 2025 having four quarters of trade-in subsidy vs. 2024's one quarter and smartphone's participation, JD.com is on solid growth footing in our universe. </li>
<li>We raised JD.com's TP from US$50 to US$ 52 TP and maintain BUY rating.</li>
</ul>


We expect JD.com C4Q24 revenue/non-GAAP NI to be RMB337bn/9.7bn, 1.6%/6.5% above consensus, benefiting from trade-in subsidies and logistics;
With 2025 having four quarters of trade-in subsidy vs. 2024's one quarter and smartphone's participation, JD.com is on solid growth footing in our universe. 
We raised JD.com's TP from US$50 to US$ 52 TP and maintain BUY rating.


[JD.com, Inc (JD US, BUY, TP US$52) TP Change]: C4Q24 Preview: Still the Safe Choice into 2025

China

JD.com Inc is an online direct sales company in China.  The Company offers a wide selection of products through its website and mobile applications.  JD.com sells appliances, computers, digital products, communication products, garments, books, and household items to consumers and vendors.

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JD.com (ADR) (JD US)

Quiddity Leaderboard HSTECH Jun25: US$204mn One-Way; No Index Changes Likely

AAC Technologies and China Literature are the highest-ranked potential ADD and potential DEL respectively. However, both of these names are very...

Janaghan Jeyakumar, CFA

JD.com (9618 HK) FY Earnings Recap: Intra-Day Swing of 7.3%.

JD.com's Q4 earnings beat expectations, causing stock volatility and resulting in a net gain of only 3.0% over two days. Options strategies were...

Gaudenz Schneider

[JD.com, Inc (JD US, BUY, TP US$52) Earnings Review]: Market Calls for Longer-Term Growth Drivers

JD's Q4 revenue and adjusted NI beat estimates, driven by subsidies and logistic gains. Revenue growth expected to slow in 2H25. Maintaining BUY...

Blue Lotus Research Institute

HSI, HSCEI, HSTECH, HSIII, HSBIO Index Rebalance: US$6.4bn of Flows Post Capping (Dec 2025)

The Dec rebalance of the HSI, HSCEI, HSTECH, HSIII, HSHKBIO indices will use today's closing prices for capping. The round-trip trade across the...

Brian Freitas

[JD.com, Inc (JD US, BUY, TP US$52) TP Change]: C4Q24 Preview: Still the Safe Choice into 2025

JD.com's revenue and non-GAAP net income exceed expectations, driven by trade-in subsidies and logistics, with strong growth potential in the...

Blue Lotus Research Institute

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Quiddity Leaderboard HSTECH Jun25: US$204mn One-Way; No Index Changes Likely

AAC Technologies and China Literature are the highest-ranked potential ADD and potential DEL respectively. However, both of these names are very...

Janaghan Jeyakumar, CFA

JD.com (9618 HK) FY Earnings Recap: Intra-Day Swing of 7.3%.

​JD.com's Q4 earnings beat expectations, causing stock volatility and resulting in a net gain of only 3.0% over two days. Options strategies were...

Gaudenz Schneider

[JD.com, Inc (JD US, BUY, TP US$52) Earnings Review]: Market Calls for Longer-Term Growth Drivers

​JD's Q4 revenue and adjusted NI beat estimates, driven by subsidies and logistic gains. Revenue growth expected to slow in 2H25. Maintaining BUY...

Blue Lotus Research Institute

HSI, HSCEI, HSTECH, HSIII, HSBIO Index Rebalance: US$6.4bn of Flows Post Capping (Dec 2025)

The Dec rebalance of the HSI, HSCEI, HSTECH, HSIII, HSHKBIO indices will use today's closing prices for capping. The round-trip trade across the...

Brian Freitas

[JD.com, Inc (JD US, BUY, TP US$52) TP Change]: C4Q24 Preview: Still the Safe Choice into 2025

​JD.com's revenue and non-GAAP net income exceed expectations, driven by trade-in subsidies and logistics, with strong growth potential in the...

Blue Lotus Research Institute

JD.com's Q4 earnings beat expectations, causing stock volatility and resulting in a net gain of only 3.0% over two days. Options strategies were...

JD's Q4 revenue and adjusted NI beat estimates, driven by subsidies and logistic gains. Revenue growth expected to slow in 2H25. Maintaining BUY...

JD.com's revenue and non-GAAP net income exceed expectations, driven by trade-in subsidies and logistics, with strong growth potential in the...