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

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/budweiser-brewing-co-apac-ltd" target="_blank" data-smartkarma-citation="entities:28077:1" rel="noopener">Budweiser Brewing APAC (1876 HK)</a> has seen investors run for the hills over the last year. The halving of the stock price could mean deletion from passive portfolios.</li>
<li>Other Hong Kong listed brewers, <a href="https://www.smartkarma.com/entities/china-resources-beer-holdings" target="_blank" data-smartkarma-citation="entities:399:1" rel="noopener">China Resources Beer Holdings (291 HK)</a> and <a href="https://www.smartkarma.com/entities/tsingtao-brewery-co-ltd-h" target="_blank" data-smartkarma-citation="entities:1296:1" rel="noopener">Tsingtao Brewery Co Ltd H (168 HK)</a> have been beaten down too and have underperformed their Asian peers.</li>
<li>The deletion from passive portfolios could provide a buying opportunity in <a href="https://www.smartkarma.com/entities/budweiser-brewing-co-apac-ltd" target="_blank" data-smartkarma-citation="entities:28077:1" rel="noopener">Budweiser Brewing APAC (1876 HK)</a> at the end of February (or earlier if the stock drops due to positioning).</li>
</ul>



Budweiser Brewing APAC (1876 HK) has seen investors run for the hills over the last year. The halving of the stock price could mean deletion from passive portfolios.
Other Hong Kong listed brewers, China Resources Beer Holdings (291 HK) and Tsingtao Brewery Co Ltd H (168 HK) have been beaten down too and have underperformed their Asian peers.
The deletion from passive portfolios could provide a buying opportunity in Budweiser Brewing APAC (1876 HK) at the end of February (or earlier if the stock drops due to positioning).


Bud APAC (1876 HK): Nursing a Hangover; Now Comes a Passive Overhang

<ul>
<li>The FRTIB benchmark switch from the EAFE Index to the ACWI IMI ex-USA ex-China ex-Hong Kong Index will result in a round trip trade of around US$56bn.</li>
<li>The changes for the <a href="https://www.smartkarma.com/entities/shanghai-shenzhen-csi-300-inde" target="_blank" data-smartkarma-citation="entities:22906:1" rel="noopener">CSI 300</a>, <a href="https://www.smartkarma.com/entities/csi-smallcap-500-index-shang" target="_blank" data-smartkarma-citation="entities:35347:1" rel="noopener">CSI 500</a>, <a href="https://www.smartkarma.com/entities/sse-science-and-technology-innovation-board-50-index" target="_blank" data-smartkarma-citation="entities:29279:1" rel="noopener">STAR50</a>, <a href="https://www.smartkarma.com/entities/shanghai-stock-exchange-sse-50-a-share-index" target="_blank" data-smartkarma-citation="entities:31073:1" rel="noopener">SSE50</a> and a bunch of other mainland China indices will be announced after market close on Friday.</li>
<li>Relatively quiet week for ETF flows with no major creations or redemptions during the week.</li>
</ul>


The FRTIB benchmark switch from the EAFE Index to the ACWI IMI ex-USA ex-China ex-Hong Kong Index will result in a round trip trade of around US$56bn.
The changes for the CSI 300, CSI 500, STAR50, SSE50 and a bunch of other mainland China indices will be announced after market close on Friday.
Relatively quiet week for ETF flows with no major creations or redemptions during the week.


Index Rebalance & ETF Flow Recap: FRTIB, Japan, CSI300, CSI500, STAR50, WuXi XDC, Asahi

Asia Consumer Research, Investory

Devi Subhakesan

Asia Consumer Research

ASIA CONSUMER: INSIGHTS AND INVESTMENT IDEAS

Investory

Investory is a Singapore-based boutique independent equity research firm founded in January 2017 with a primary focus on consumption themes across Asia-Pacific.

We aim to generate investible ideas based on consumption trends and outlook. We screen our ideas on several parameters - product potential, long-term growth and management commitment being the most critical.  We follow a fundamental analysis approach in our stock selection process and are not restricted by market cap.

We aspire to grow into a leading source of unbiased research, free of conflict of interest, for investors yearning for independent and disciplined analysis. 

We also undertake bespoke research mandates to support our Institutional clients’ investment needs.

Our team comprises of professionals with extensive experience in the Asian equity markets, in areas ranging from research, servicing institutional clients and investment management.

Equity Bottom-Up

<p><a href="https://www.smartkarma.com/entities/thai-beverage-pcl" target="_blank" data-smartkarma-citation="entities:3656:1" rel="noopener">Thai Beverage (THBEV SP)</a> had reported a strong improvement in its Thailand operations for 9MFY2021 suggesting that a recovery is underway and we expect this could look up further as the country opens to tourists from November 1st (ending quarantine for visitors to tourist destinations). The stock, at current levels, does not seem to factor in an earnings recovery given it is trading at conservative valuations even on current earnings.  In the insight below, we share SOTP based valuation to assess the stock's upside potential and discuss possible catalysts and timelines.</p>

Thai Beverage (THBEV SP) had reported a strong improvement in its Thailand operations for 9MFY2021 suggesting that a recovery is underway and we expect this could look up further as the country opens to tourists from November 1st (ending quarantine for visitors to tourist destinations). The stock, at current levels, does not seem to factor in an earnings recovery given it is trading at conservative valuations even on current earnings.  In the insight below, we share SOTP based valuation to assess the stock's upside potential and discuss possible catalysts and timelines.

Thai Bev (THBEV SP): Neither Recovery nor BeerCo IPO Is Priced In. SOTP Suggests Upside.

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/fancl-corp" target="_blank" data-smartkarma-citation="entities:15862:1" rel="noopener">Fancl Corp (4921 JP)</a> recommended <a href="https://www.smartkarma.com/entities/kirin-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:16977:1" rel="noopener">Kirin Holdings (2503 JP)</a>’s tender offer of JPY2,690, a 42.7% premium to the undisturbed price. </li>
<li>The timing looks opportunistic as Fancl's shares are down 20% YTD. The offer period is from 17 June to 29 July.</li>
<li>While the offer is attractive vs peer multiples, it is light vs historical trading ranges. Securing the required acceptance rate could prove challenging as the offer price is light. </li>
</ul>



Fancl Corp (4921 JP) recommended Kirin Holdings (2503 JP)’s tender offer of JPY2,690, a 42.7% premium to the undisturbed price. 
The timing looks opportunistic as Fancl's shares are down 20% YTD. The offer period is from 17 June to 29 July.
While the offer is attractive vs peer multiples, it is light vs historical trading ranges. Securing the required acceptance rate could prove challenging as the offer price is light. 


Fancl (4921 JP): Kirin (2503 JP)’s Light JPY2,690 Tender Offer

Expert on Japan Retail and Consumer Markets, JapanConsuming

Michael Causton

Expert on Japan Retail and Consumer Markets

Real Insight on Japanese Consumer Markets

JapanConsuming

JapanConsuming is a specialist research firm producing intelligence on Japanese retail and consumer markets. Founded in 2000, JapanConsuming has become the leading provider of insights on Japanese retailers and consumer trends to retailers, brands, government agencies and investors. As well as a highly regarded monthly report on the market, JapanConsuming produces in-depth reports on retail sectors, seminars on key trends and telephone consulting to investors on trends and retailers.

JapanConsuming was founded by Michael Causton and Roy Larke. 

Thematic (Sector/Industry)

<ul>
<li>April, which along with October is the month when many Japanese FMCG brands adjust prices, saw far fewer price hikes this year compared to 2023. </li>
<li>Even so, numerous major brands still announced hefty price increases for later in the year.</li>
<li>Meanwhile, government subsidies for utility costs are ending and the weak Yen is an increasing concern for many consumer-facing companies. </li>
</ul>


April, which along with October is the month when many Japanese FMCG brands adjust prices, saw far fewer price hikes this year compared to 2023. 
Even so, numerous major brands still announced hefty price increases for later in the year.
Meanwhile, government subsidies for utility costs are ending and the weak Yen is an increasing concern for many consumer-facing companies. 


Fewer Price Hikes in Spring, but Prices Still Rising

Japan

Kirin Holdings Company, Limited produces beer, soft drinks, food products, whisky, and pharmaceuticals.  The Company sells its products in Japan and overseas.

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Kirin Holdings (2503 JP)

Bud APAC (1876 HK): Nursing a Hangover; Now Comes a Passive Overhang

Bud APAC is up since the Insight was published and is near the upper end of the downward sloping channel. With Hong Kong closed Monday and Tuesday...

Brian Freitas

Index Rebalance & ETF Flow Recap: FRTIB, Japan, CSI300, CSI500, STAR50, WuXi XDC, Asahi

This recap highlights Insights covering Asian index rebalances (announcements/ forecasts/ IPO Fast Entry/ M&A driven changes). We also highlight...

Brian Freitas

Thai Bev (THBEV SP): Neither Recovery nor BeerCo IPO Is Priced In. SOTP Suggests Upside.

SOTP based valuation analysis suggests room for near-term upside even at conservative valuation multiples assuming the worst of COVID is past us.

Devi Subhakesan

Fancl (4921 JP): Kirin (2503 JP)’s Light JPY2,690 Tender Offer

The timing is opportunistic. While the offer is attractive compared to peer multiples, it is light compared to historical trading ranges. Securing...

Arun George

Fewer Price Hikes in Spring, but Prices Still Rising

April saw fewer price hikes on the year, but major brands are still planning hefty increases soon. Government subsidies for utilities are ending...

Michael Causton

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52-week Range

Market Cap (USDm)

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