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 March rebalance ended yesterday, the changes will be announced early March and implemented at the close of trading on 14 March.</li>
<li>We forecast one change for each of the Secondary Battery, Bio, Internet and Game indices. There could be two changes for the BBIG Index.</li>
<li>
<a href="https://www.smartkarma.com/entities/douzone-bizon-co-ltd" target="_blank" data-smartkarma-citation="entities:20161:1" rel="noopener">Douzone Bizon (012510 KS)</a> is up 65.5% in the last month and we'd look to lighten positions on this move higher.</li>
</ul>


The review period for the March rebalance ended yesterday, the changes will be announced early March and implemented at the close of trading on 14 March.
We forecast one change for each of the Secondary Battery, Bio, Internet and Game indices. There could be two changes for the BBIG Index.

Douzone Bizon (012510 KS) is up 65.5% in the last month and we'd look to lighten positions on this move higher.


KRX New Deal Index Rebalance Preview: Douzone Bizon Does It Again

<ul>
<li>The review period for the March rebalance ends on 31 January, the changes will be announced early March and implemented at the close of trading on 14 March.</li>
<li>There is one change currently for each of the Secondary Battery, Bio, Internet and Game indices. There are two changes for the BBIG Index.</li>
<li>There will be big flow on <a href="https://www.smartkarma.com/entities/ecopro-bm-co-ltd" target="_blank" data-smartkarma-citation="entities:27873:1" rel="noopener">Ecopro BM (247540 KS)</a> and <a href="https://www.smartkarma.com/entities/posco-future-m-co-ltd" target="_blank" data-smartkarma-citation="entities:12421:1" rel="noopener">Posco Future M (003670 KS)</a> and big impact on <a href="https://www.smartkarma.com/entities/douzone-bizon-co-ltd" target="_blank" data-smartkarma-citation="entities:20161:1" rel="noopener">Douzone Bizon (012510 KS)</a> and <a href="https://www.smartkarma.com/entities/dearu-co-ltd" target="_blank" data-smartkarma-citation="entities:34381:1" rel="noopener">DearU (376300 KS)</a>. </li>
</ul>


The review period for the March rebalance ends on 31 January, the changes will be announced early March and implemented at the close of trading on 14 March.
There is one change currently for each of the Secondary Battery, Bio, Internet and Game indices. There are two changes for the BBIG Index.
There will be big flow on Ecopro BM (247540 KS) and Posco Future M (003670 KS) and big impact on Douzone Bizon (012510 KS) and DearU (376300 KS). 


KRX New Deal Index Rebalance Preview: Changes with Flow & Impact

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Event-Driven

<ul>
<li>The total amount of share cancellations by Korean companies increased sharply in the past three years. Share cancellations of 6.1 trillion won in 2023 represented a 140% increase from 2021.</li>
<li>Although the total amount of share cancellations of 6.1 trillion won in 2023 seems fairly large, this represented only 0.24% of total market caps of Korean companies. </li>
<li>We also provide a list of seven Korean companies that have been targeted by activist investors  to cancel more shares and improve corporate governance. </li>
</ul>


The total amount of share cancellations by Korean companies increased sharply in the past three years. Share cancellations of 6.1 trillion won in 2023 represented a 140% increase from 2021.
Although the total amount of share cancellations of 6.1 trillion won in 2023 seems fairly large, this represented only 0.24% of total market caps of Korean companies. 
We also provide a list of seven Korean companies that have been targeted by activist investors  to cancel more shares and improve corporate governance. 


A 140% Increase in Share Cancellations by Korean Companies from 2021 to 2023

Asia Pac ECM and Index Rebal, Shenton Research

Ke Yan, CFA, FRM

Asia Pac ECM and Index Rebal

Asia Pac IPO & Placement Research, China Biotech

DZT Research

DZT Research is an independent Asia Pacific equity specialist. Our quantitative research covers index rebalancing flows, alongside exchange data analytics accross Asia Pacific. On the equity capital markets side, we focus on Asia Pacific ECM, especially biotech and TMT. Our lead analyst is frequently cited by international media.

Quantitative Analysis

<ul>
<li>We analyzed the changes in short interest of KRX Stocks as of Nov 10th which has an aggregated short interest worth USD12.0bn.</li>
<li>We tabulate league table for top short by value and short as multiple of ADT, as well as weekly increases &amp; decreases in short value, short as multiple of ADT.</li>
<li>We highlight short interest changes in Medytox, Lg Energy Solution, Kakao, Krafton, Amorepacific.</li>
</ul>


We analyzed the changes in short interest of KRX Stocks as of Nov 10th which has an aggregated short interest worth USD12.0bn.
We tabulate league table for top short by value and short as multiple of ADT, as well as weekly increases &amp; decreases in short value, short as multiple of ADT.
We highlight short interest changes in Medytox, Lg Energy Solution, Kakao, Krafton, Amorepacific.


KRX Short Interest Weekly (Nov 10th): Short Covers for LG Energy, Kakao, Krafton, Amorepacific

Equity Bottom-Up

<ul>
<li>There is a high likelihood of the Indian authorities fully approving the BGMI game after three months of trial. Plus, it has a solid pipeline of new games under development. </li>
<li>Krafton is improving its shareholder return policy. In addition, the consensus is likely to raise the company's earnings estimates post its excellent results in 1Q 2023. </li>
<li>We maintain our Positive view of Krafton and its shares are likely to continue to outperform the market this year. </li>
</ul>


There is a high likelihood of the Indian authorities fully approving the BGMI game after three months of trial. Plus, it has a solid pipeline of new games under development. 
Krafton is improving its shareholder return policy. In addition, the consensus is likely to raise the company's earnings estimates post its excellent results in 1Q 2023. 
We maintain our Positive view of Krafton and its shares are likely to continue to outperform the market this year. 


Krafton: India & Improving Shareholder Return Policy Likely to Lead to Further Outperformance

South Korea

Krafton, Inc. operates as a game development company. The Company develops console games, mobile games, computer games, and other related products. Krafton markets its products throughout South Korea.

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Krafton (259960 KS)

KRX New Deal Index Rebalance Preview: Douzone Bizon Does It Again

There should be 1 change for each of the Battery, Bio, Internet and Game indices plus 2 changes for the BBIG Index. Douzone Bizon is repeating what...

Brian Freitas

KRX New Deal Index Rebalance Preview: Changes with Flow & Impact

With just over a week to go in the review period, the potential changes to the index are moving. Douzone Bizon is up 39% in two weeks and appears...

Brian Freitas

KRX Short Interest Weekly (Nov 10th): Short Covers for LG Energy, Kakao, Krafton, Amorepacific

We analyzed KRX short interest report for the past week and highlight short interest changes in Medytox, Lg Energy Solution, Kakao, Krafton,...

Ke Yan, CFA, FRM

Krafton: India & Improving Shareholder Return Policy Likely to Lead to Further Outperformance

Krafton's share price is up 11% today after better than expected results in 3Q 2023. It had sales of 450 billion won (up 3.8% YoY) and operating...

Douglas Kim

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

KRX New Deal Index Rebalance Preview: Douzone Bizon Does It Again

There should be 1 change for each of the Battery, Bio, Internet and Game indices plus 2 changes for the BBIG Index. Douzone Bizon is repeating what...

Brian Freitas

KRX New Deal Index Rebalance Preview: Changes with Flow & Impact

With just over a week to go in the review period, the potential changes to the index are moving. Douzone Bizon is up 39% in two weeks and appears...

Brian Freitas

A 140% Increase in Share Cancellations by Korean Companies from 2021 to 2023

The total amount of share cancellations by Korean companies increased sharply in the past three years. Share cancellations of 6.1 trillion won in...

Douglas Kim

KRX Short Interest Weekly (Nov 10th): Short Covers for LG Energy, Kakao, Krafton, Amorepacific

We analyzed KRX short interest report for the past week and highlight short interest changes in Medytox, Lg Energy Solution, Kakao, Krafton,...

Ke Yan, CFA, FRM

Krafton: India & Improving Shareholder Return Policy Likely to Lead to Further Outperformance

Krafton's share price is up 11% today after better than expected results in 3Q 2023. It had sales of 450 billion won (up 3.8% YoY) and operating...

Douglas Kim