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

Quantitative Analysis

<ul>
<li>We look at short interest across Hong Kong, Japan, Korea and Taiwan in April to identify stocks/sectors that have seen the largest changes in each market.</li>
<li>Korea and Taiwan are showing a clear divergence with short notional increasing as the market moves lower, indicative of new shorts being initiated.</li>
<li>
<a href="https://www.smartkarma.com/entities/china-merchants-bank-co-ltd-3388a037-4214-4997-b45d-520518cfdb57" target="_blank" data-smartkarma-citation="entities:10987:1" rel="noopener">China Merchants Bank H (3968 HK)</a> has seen the largest short covering as the stock has tumbled in the last couple of weeks.</li>
</ul>


We look at short interest across Hong Kong, Japan, Korea and Taiwan in April to identify stocks/sectors that have seen the largest changes in each market.
Korea and Taiwan are showing a clear divergence with short notional increasing as the market moves lower, indicative of new shorts being initiated.

China Merchants Bank H (3968 HK) has seen the largest short covering as the stock has tumbled in the last couple of weeks.


Asia Short Interest: Large Moves in April

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Event-Driven

<ul>
<li>On 23 February, LG Electronics announced that it will exit the solar panel business due to lack of competitiveness as it has been losing money in this business. </li>
<li>This restructuring will have a positive impact on LG Electronics. We applaud its strategy of focusing on what it does best and exiting businesses where it is not competitive. </li>
<li>Assuming operating loss of 80 billion won and a 9% cost of capital, this would result in perpetuity value losses of 889 billion won.</li>
</ul>


On 23 February, LG Electronics announced that it will exit the solar panel business due to lack of competitiveness as it has been losing money in this business. 
This restructuring will have a positive impact on LG Electronics. We applaud its strategy of focusing on what it does best and exiting businesses where it is not competitive. 
Assuming operating loss of 80 billion won and a 9% cost of capital, this would result in perpetuity value losses of 889 billion won.


LG Electronics: Impact of Restructuring the Solar Panel Business

Equity Bottom-Up

<ul>
<li>Lg Innotek (011070 KS), a leading global producer of optical electronic parts, has one of the most attractive fundamentals in Korea. </li>
<li>LG Innotek has become one of the critical suppliers for Apple's smartphones. For example, LG Innotek accounted for more than 70% of the camera modules used for Apple's iPhone 13.</li>
<li>In the intermediate term, LG Innotek is expected to benefit from higher demand for metaverse related cameras, 3D sensing modules, and autonomous vehicle cameras. </li>
</ul>


Lg Innotek (011070 KS), a leading global producer of optical electronic parts, has one of the most attractive fundamentals in Korea. 
LG Innotek has become one of the critical suppliers for Apple's smartphones. For example, LG Innotek accounted for more than 70% of the camera modules used for Apple's iPhone 13.
In the intermediate term, LG Innotek is expected to benefit from higher demand for metaverse related cameras, 3D sensing modules, and autonomous vehicle cameras. 


LG Innotek: One of the Most Attractive Fundamentals in the Korean Stock Market

<ul>
<li>After the market close today, it was announced that Chairman of LX Holdings Koo Bon-Joon will sell about 530 billion won worth of LG Corp (003550 KS).</li>
<li>The block sale price range is from 79,800 won to 82,400 won per share, which are 5.2% to 8.2% discount to the closing price of LG Corp today.</li>
<li>We would take the deal and we continue to have a positive view of LG Corp. </li>
</ul>


After the market close today, it was announced that Chairman of LX Holdings Koo Bon-Joon will sell about 530 billion won worth of LG Corp (003550 KS).
The block sale price range is from 79,800 won to 82,400 won per share, which are 5.2% to 8.2% discount to the closing price of LG Corp today.
We would take the deal and we continue to have a positive view of LG Corp. 


Chairman of LX Holdings Koo Bon-Joon Selling About 530 Billion Won Worth of LG Corp

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.

Equity Capital Markets

LG Energy Solution / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/lg-energy-solution" target="_blank" data-smartkarma-citation="entities:33464:1" rel="noopener">LG Energy Solution (LGENERGY KS)</a> is a leading EV battery manufacturer. It is pre-marketing an IPO to raise up to $10.8 billion, which would be South Korea’s largest-ever listing.  </li>
<li>LGES is offering 42.5 million shares with a primary/secondary split of 80/20. Pre-marketing will run until 17 December.  </li>
<li>LGES has attractive fundamentals with a strong backlog, healthy revenue growth and improving margins (recall provisions have peaked). </li>
</ul>



LG Energy Solution (LGENERGY KS) is a leading EV battery manufacturer. It is pre-marketing an IPO to raise up to $10.8 billion, which would be South Korea’s largest-ever listing.  
LGES is offering 42.5 million shares with a primary/secondary split of 80/20. Pre-marketing will run until 17 December.  
LGES has attractive fundamentals with a strong backlog, healthy revenue growth and improving margins (recall provisions have peaked). 


LG Energy Solution IPO Initiation: Amp My Ride

South Korea

LG Electronics Inc. manufactures and markets digital display equipment and home appliances. The Company produces and markets flat panel televisions, A/V products, washing machines, air conditioners and refrigerators as well as telecommunications equipment such as smart phones and tablets.

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LG Electronics (066570 KS)

Asia Short Interest: Large Moves in April

Short notional in Korea and Taiwan has been increasing as the market has been moving lower. Shorts on China Merchant Bank have been covered in...

Brian Freitas

LG Electronics: Impact of Restructuring the Solar Panel Business

On 23 February, LG Electronics announced that it will exit the solar panel business due to lack of competitiveness as it has been losing money in...

Douglas Kim

LG Innotek: One of the Most Attractive Fundamentals in the Korean Stock Market

Lg Innotek has a combination of relatively reasonable valuation multiples and excellent sales and profit growth rates. LG Innotek has become one of...

Douglas Kim

Chairman of LX Holdings Koo Bon-Joon Selling About 530 Billion Won Worth of LG Corp

It was announced that Chairman of LX Holdings Koo Bon-Joon will sell about 530 billion won worth of LG Corp through a block deal sale. We would...

Douglas Kim

LG Energy Solution IPO Initiation: Amp My Ride

LGES is pre-marketing an IPO to raise up to $10.8 bn, potentially Korea’s largest-ever listing. It has attractive fundamentals with a strong...

Arun George

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