Korea / Special Situations, Clepsydra Capital

Sanghyun Park

Korea / Special Situations

Korea / Special Sits, Pairs, Index Rebalancing

Clepsydra Capital

Investigate special situations, pairs, and index rebalancing trades in Korea.

Event-Driven

KMW and HLB are at the top in both short and loan interests among the KOSDAQ stocks (excluding SillaJen).KMW has a 4.83% short interest (as a % of SO), closely followed by HLB at 4.57%.Not much change in their short interest, but KMW had a substantial weekly increase in its loan interest, +18.42% and +2.18%p. Its loan interest now sits at a whopping 18.42% of the SO.













Top 20 short interest
Ticker
K150
Short
1W Δ
1W Δ %p
Loan
1W Δ
1W Δ %p


KMW Co Ltd
032500
126
4.83%
-0.10%
0.00%p
14.02%
18.42%
2.18%p


HLB Inc
028300
82
4.57%
1.26%
0.06%p
10.92%
4.51%
0.47%p


Apam Corp
073070
#N/A
2.41%
0.00%
0.00%p
4.09%
0.00%
0.00%p


Sangsangin Co Ltd
038540
50
2.08%
-4.34%
-0.09%p
4.11%
-0.76%
-0.03%p


Toptec Co Ltd
108230
137
2.07%
-1.95%
-0.04%p
4.05%
0.60%
0.02%p


NatureCell Co Ltd
007390
19
1.96%
4.13%
0.08%p
5.31%
-0.76%
-0.04%p


Kuk Il Paper MFG Co Ltd
078130
17
1.92%
3.92%
0.07%p
6.75%
1.77%
0.12%p


Komipharm International Co., Ltd.
041960
128
1.84%
-1.23%
-0.02%p
4.51%
1.30%
0.06%p


BH Co Ltd
090460
45
1.79%
0.30%
0.01%p
4.90%
0.96%
0.05%p


Power Logics
047310
#N/A
1.75%
-0.12%
0.00%p
2.85%
-7.12%
-0.22%p


Innovation For Creative Devices Co Ltd
040910
#N/A
1.73%
-0.92%
-0.02%p
2.83%
0.57%
0.02%p


Korea Alcohol Industrial
017890
#N/A
1.72%
3.37%
0.06%p
2.99%
0.00%
0.00%p


Cancer Rop Co Ltd
180400
#N/A
1.67%
0.00%
0.00%p
1.98%
-0.12%
0.00%p


Curocom Co., Ltd.
040350
#N/A
1.62%
3.46%
0.05%p
2.84%
0.00%
0.00%p


MS Autotech Co Ltd
123040
#N/A
1.50%
0.12%
0.00%p
2.73%
0.00%
0.00%p


Hyundai Bioscience Co Ltd
048410
148
1.49%
-0.67%
-0.01%p
4.50%
1.37%
0.06%p


ACT Co Ltd (Chungcheongbuk-do)
138360
#N/A
1.48%
0.00%
0.00%p
1.98%
0.00%
0.00%p


Orbitech Co Ltd
046120
#N/A
1.46%
-1.78%
-0.03%p
2.04%
0.39%
0.01%p


STCube Inc
052020
78
1.45%
0.82%
0.01%p
3.62%
1.94%
0.07%p


Chemtronics Co Ltd
089010
#N/A
1.45%
-1.14%
-0.02%p
3.23%
-0.21%
-0.01%p

Source: KRX &amp; KOFIA















Top 20 loan balance
Ticker
K150
Short
1W Δ
1W Δ %p
Loan
1W Δ
1W Δ %p


KMW Co Ltd
032500
126
4.83%
-0.10%
0.00%p
14.02%
18.42%
2.18%p


HLB Inc
028300
82
4.57%
1.26%
0.06%p
10.92%
4.51%
0.47%p


Easy Holdings Co Ltd
035810
113
0.46%
0.58%
0.00%p
8.08%
3.57%
0.28%p


Anterogen Co Ltd
065660
72
0.59%
1.17%
0.01%p
7.44%
-3.19%
-0.25%p


Medipost Co Ltd
078160
42
0.84%
-0.17%
0.00%p
7.36%
1.90%
0.14%p


Intops Co Ltd
049070
#N/A
0.07%
0.00%
0.00%p
7.33%
-28.64%
-2.94%p


Ecopro Co., Ltd.
086520
86
0.74%
-5.99%
-0.05%p
7.04%
1.68%
0.12%p


Kuk Il Paper MFG Co Ltd
078130
17
1.92%
3.92%
0.07%p
6.75%
1.77%
0.12%p


NHN KCP Corp
060250
9
0.09%
23.86%
0.02%p
6.72%
2.53%
0.17%p


Jusung Engineering Co., Ltd.
036930
118
0.42%
-9.99%
-0.05%p
6.52%
2.24%
0.14%p


PearlAbyss Corp
263750
142
0.43%
284.98%
0.32%p
6.52%
394.02%
5.20%p


Seegene Inc
096530
66
0.67%
-2.59%
-0.02%p
6.16%
23.97%
1.19%p


PARTRON Co Ltd
091700
141
1.41%
-26.86%
-0.52%p
6.11%
12.15%
0.66%p


Genic Co Ltd
123330
#N/A
0.33%
0.00%
0.00%p
6.07%
-0.13%
-0.01%p


TSE Co Ltd
131290
#N/A
0.07%
0.00%
0.00%p
5.88%
-11.63%
-0.77%p


MedyTox Inc
086900
41
0.60%
2.17%
0.01%p
5.86%
-0.01%
0.00%p


DAWONSYS CO., LTD
068240
26
0.76%
1.00%
0.01%p
5.86%
-6.62%
-0.41%p


JYP Entertainment Corp
035900
6
0.57%
96.86%
0.28%p
5.84%
-1.89%
-0.11%p


Cafe24 Corp
042000
123
1.21%
10.81%
0.12%p
5.59%
1.83%
0.10%p


L&amp;K Biomed Co Ltd
156100
#N/A
0.05%
53.16%
0.02%p
5.35%
-0.79%
-0.04%p

Source: KRX &amp; KOFIA

In the run-up to the May 3 short-selling resumption, we should probably focus on gainers in loan interest, which often serves as a leading indicator of short-selling.Last week, the biggest gainer was Pearl Abyss, with a 5.2%p increase to 6.52% of the SO. Kyhyoung and KMW follow distantly, with 3.24%p and 2.18%p, respectively.The market seems to be interested in shorting Pearl Abyss on the recent bounce, largely resulting from the stock split event.













Top 20 loan balance gainers
Ticker
K150
Short
1W Δ
1W Δ %p
Loan
1W Δ
1W Δ %p


PearlAbyss Corp
263750
142
0.43%
284.98%
0.32%p
6.52%
394.02%
5.20%p


Kohyoung Technology Inc
098460
15
1.10%
387.22%
0.87%p
4.04%
405.32%
3.24%p


KMW Co Ltd
032500
126
4.83%
-0.10%
0.00%p
14.02%
18.42%
2.18%p


Victek Co., Ltd.
065450
#N/A
0.19%
-73.11%
-0.53%p
2.64%
132.44%
1.51%p


Seegene Inc
096530
66
0.67%
-2.59%
-0.02%p
6.16%
23.97%
1.19%p


Ace Technologies Corp.
088800
81
0.82%
-0.75%
-0.01%p
3.67%
40.14%
1.05%p


HLB Life Science Co Ltd
067630
83
1.32%
-1.60%
-0.02%p
4.62%
23.87%
0.89%p


Bosung Power Technology Co., Ltd.
006910
#N/A
1.05%
-0.11%
0.00%p
2.43%
51.56%
0.83%p


Alteogen Inc
196170
74
0.26%
39.89%
0.07%p
3.20%
34.31%
0.82%p


Helixmith Co Ltd
084990
147
0.78%
-0.71%
-0.01%p
4.89%
15.94%
0.67%p


PARTRON Co Ltd
091700
141
1.41%
-26.86%
-0.52%p
6.11%
12.15%
0.66%p


Deutsch Motors Inc
067990
#N/A
0.89%
2.00%
0.02%p
2.81%
29.96%
0.65%p


Kakao Games Corp
293490
122
0.00%
-100.00%
-0.01%p
4.08%
18.68%
0.64%p


Youngsin Metal Industrial
007530
#N/A
0.00%
#DIV/0!
0.00%p
0.98%
171.75%
0.62%p


Eone Diagnomics Genome Center Co Ltd
245620
#N/A
0.32%
127.91%
0.18%p
1.46%
69.18%
0.60%p


Huons Global Co Ltd
084110
#N/A
0.08%
-10.97%
-0.01%p
1.23%
85.37%
0.57%p


FORMETAL CO., LTD.
119500
#N/A
0.00%
#DIV/0!
0.00%p
2.11%
36.06%
0.56%p


LET Co Ltd
297890
#N/A
0.00%
#DIV/0!
0.00%p
0.52%
#DIV/0!
0.52%p


HLB Inc
028300
82
4.57%
1.26%
0.06%p
10.92%
4.51%
0.47%p


Fantagio Corp
032800
#N/A
0.31%
400.00%
0.25%p
0.58%
307.70%
0.44%p

Source: KRX &amp; KOFIA



KOSDAQ Short/Loan Int: Pearl Abyss on Radar for Recent Bounce & Big Names KOSPI Moving

Quantitative Analysis

Multiple news outlets in Korea have reported late last night that the Korea FSC would announce the first-phase measures of new restrictions for short selling as early as today. We are still in a sort of the first phase. So, the FSC wouldn't go as far as an across-the-board ban at this time. Then, what would it be? Reportedly, the FSC will tighten the one-day ban of overheated short-selling stocks. Currently, the KRX classifies and designates so-called overheated stocks with a sudden and abnormal increase of short-sale transactions and bans them from further short-selling on the following day. The FSC will likely extend the banning period. Moreover, it will probably tighten the designation criteria.<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/122/132/original/1.png?1583784320" class="editor-image img-responsive" data-smartkarma-image-id="122132"></figure>Then, let's examine what names would emerge as a potential short-term short squeezing target from a quant angle.

Multiple news outlets in Korea have reported late last night that the Korea FSC would announce the first-phase measures of new restrictions for short selling as early as today. We are still in a sort of the first phase. So, the FSC wouldn't go as far as an across-the-board ban at this time. Then, what would it be? Reportedly, the FSC will tighten the one-day ban of overheated short-selling stocks. Currently, the KRX classifies and designates so-called overheated stocks with a sudden and abnormal increase of short-sale transactions and bans them from further short-selling on the following day. The FSC will likely extend the banning period. Moreover, it will probably tighten the designation criteria.Then, let's examine what names would emerge as a potential short-term short squeezing target from a quant angle.

Short-Selling Rule Change in Korea: Potential Names for Short Squeezing

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Bottom-Up

<div class="content-highlight">
<a href="https://www.smartkarma.com/entities/mcnex-co-ltd" target="_blank" data-smartkarma-citation="entities:18108:1" rel="noopener">Mcnex Co Ltd (097520 KS)</a> is a leading Korean manufacturer of camera modules for smartphones and autos. Our base case valuation for the company is 49,171 won, which would represent a 34% upside (one year) from current levels. Our base case valuation assumes a P/E multiple of 9.2x (10% premium to P/E multiple in 2019) and net profit of 95.6 billion won (current consensus estimates).
<h2>Catalysts</h2>
<ul>
<li>
Excellent demand for Samsung's mid-to-high end smartphones - The company is a key beneficiary of the continued excellent demand for Samsung's mid-to-high end smartphones including Galaxy S, Fold, and A Series as millions of consumers seek high-pixel and ultra-wide-angle cameras included smartphones.
</li>
<li>
Adoption of Level 3 autonomous vehicles in Korea - For full details, see our report, <a href="https://www.smartkarma.com/insights/a-comprehensive-list-of-korean-companies-benefiting-from-sale-of-level-3-autonomous-vehicles-in-july" target="_blank" data-smartkarma-citation="insights:35606" rel="noopener">A Comprehensive List of Korean Companies Benefiting from Sale of Level 3 Autonomous Vehicles in July</a>. 
</li>
<li>Improving capacity utilization rates of its manufacturing operations</li>
</ul>
</div>


Mcnex Co Ltd (097520 KS) is a leading Korean manufacturer of camera modules for smartphones and autos. Our base case valuation for the company is 49,171 won, which would represent a 34% upside (one year) from current levels. Our base case valuation assumes a P/E multiple of 9.2x (10% premium to P/E multiple in 2019) and net profit of 95.6 billion won (current consensus estimates).
Catalysts


Excellent demand for Samsung's mid-to-high end smartphones - The company is a key beneficiary of the continued excellent demand for Samsung's mid-to-high end smartphones including Galaxy S, Fold, and A Series as millions of consumers seek high-pixel and ultra-wide-angle cameras included smartphones.


Adoption of Level 3 autonomous vehicles in Korea - For full details, see our report, A Comprehensive List of Korean Companies Benefiting from Sale of Level 3 Autonomous Vehicles in July. 

Improving capacity utilization rates of its manufacturing operations



Mcnex - A Leading Producer of Camera Modules for Smartphones and Autos

<div class="content-highlight">On January 5th, the South Korean government (Transport Ministry) announced that it will allow automakers to start selling vehicles with basic <a href="http://www.koreaherald.com/view.php?ud=20200105000078" target="_blank" rel="noopener">Level 3 autonomous technology</a> in Korea starting July 2020, which would make the country the first to adopt Level 3 self-driving standards in the world. In this report, we provide a comprehensive list of 20 Korean companies that are likely to benefit from this regulation that would benefit from the adoption of the Level 3 autonomous vehicles technology. </div>

On January 5th, the South Korean government (Transport Ministry) announced that it will allow automakers to start selling vehicles with basic Level 3 autonomous technology in Korea starting July 2020, which would make the country the first to adopt Level 3 self-driving standards in the world. In this report, we provide a comprehensive list of 20 Korean companies that are likely to benefit from this regulation that would benefit from the adoption of the Level 3 autonomous vehicles technology. 

A Comprehensive List of Korean Companies Benefiting from Sale of Level 3 Autonomous Vehicles in July

Equity Capital Markets

<a href="https://www.smartkarma.com/entities/1257" target="_blank" data-smartkarma-citation="entities:1257:1">Cammsys Corp (050110 KS)</a> said in a regulatory filing on June 16 that it would sell ₩25bil (US$22 million) worth of debt with BWs. Its "tentative" initial warrant exercise price was set at ₩2,930 per share. It was then re-adjusted to ₩2,665 on July 31, which was the decision day of warrant exercise price. These BWs will be used to fund facility expansion and working capital. The bookrunner is <a href="https://www.smartkarma.com/entities/9611" target="_blank" data-smartkarma-citation="entities:9611:1">Yuanta Securities Korea (003470 KS)</a>. Tomorrow and after tomorrow (Aug 7-8) are the subscription days for new shareholders.<div class="content-highlight">Cammsys' regulatory filing about this BW issuance:<a href="http://dart.fss.or.kr/dsaf001/main.do?rcpNo=20170731000342" target="_blank">http://dart.fss.or.kr/dsaf001/main.do?rcpNo=20170731000342</a></div><table class="table table-striped"><tbody><tr><td style="width: 332.8px;">Item</td><td style="width: 322.2px;">Detail</td></tr><tr><td style="width: 332.8px;">Type</td><td style="width: 322.2px;">Rights offering with standby underwriting</td></tr><tr><td style="width: 332.8px;">Maturity</td><td style="width: 322.2px;">4 years</td></tr><tr><td style="width: 332.8px;">Put option</td><td style="width: 322.2px;">2 years from issuance date</td></tr><tr><td style="width: 332.8px;">Total amount</td><td style="width: 322.2px;">₩25bil</td></tr><tr><td style="width: 332.8px;">Issuance date</td><td style="width: 322.2px;">Aug 10 (tentative)</td></tr><tr><td style="width: 332.8px;">Warrant exercise price</td><td style="width: 322.2px;">₩2,665 - finalized on July 31(Initial tentative price was set at ₩2,930)</td></tr><tr><td style="width: 332.8px;">Warrant exercise starting date</td><td style="width: 322.2px;">Sep 10, 2017</td></tr><tr><td style="width: 332.8px;">Warrant exercise closing date</td><td style="width: 322.2px;">July 10, 2021</td></tr><tr><td style="width: 332.8px;">Coupon rate</td><td style="width: 322.2px;">1.00%</td></tr><tr><td style="width: 332.8px;">YTM</td><td style="width: 322.2px;">3.00%</td></tr><tr><td style="width: 332.8px;">Repayment at maturity if warrant isn't exercised</td><td style="width: 322.2px;">108.4661% of principal investment</td></tr><tr><td style="width: 332.8px;">Re-fixing rate </td><td style="width: 322.2px;">70%</td></tr><tr><td style="width: 332.8px;">Total number of shares to be offered</td><td style="width: 322.2px;">9,380,863</td></tr><tr><td style="width: 332.8px;">As a % of shares outstanding before dilution</td><td style="width: 322.2px;">16.7%</td></tr><tr><td style="width: 332.8px;">As a % of shares outstanding after dilution</td><td style="width: 322.2px;">14.3%</td></tr><tr><td colspan="2" style="width: 655px;">Source: DART</td></tr></tbody></table>* Alright, let's find out more about this BW issuance, and let's also discuss whether we should take it or pass it.

Cammsys Corp (050110 KS) said in a regulatory filing on June 16 that it would sell ₩25bil (US$22 million) worth of debt with BWs. Its "tentative" initial warrant exercise price was set at ₩2,930 per share. It was then re-adjusted to ₩2,665 on July 31, which was the decision day of warrant exercise price. These BWs will be used to fund facility expansion and working capital. The bookrunner is Yuanta Securities Korea (003470 KS). Tomorrow and after tomorrow (Aug 7-8) are the subscription days for new shareholders.Cammsys' regulatory filing about this BW issuance:http://dart.fss.or.kr/dsaf001/main.do?rcpNo=20170731000342ItemDetailTypeRights offering with standby underwritingMaturity4 yearsPut option2 years from issuance dateTotal amount₩25bilIssuance dateAug 10 (tentative)Warrant exercise price₩2,665 - finalized on July 31(Initial tentative price was set at ₩2,930)Warrant exercise starting dateSep 10, 2017Warrant exercise closing dateJuly 10, 2021Coupon rate1.00%YTM3.00%Repayment at maturity if warrant isn't exercised108.4661% of principal investmentRe-fixing rate 70%Total number of shares to be offered9,380,863As a % of shares outstanding before dilution16.7%As a % of shares outstanding after dilution14.3%Source: DART* Alright, let's find out more about this BW issuance, and let's also discuss whether we should take it or pass it.

Cammsys ₩25bil BW Issuance Summary - Public Subscription Is Aug 7-8

South Korea

Mcnex Co., Ltd. manufactures and develops camera module for mobile phones and automobiles.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

MCNEX Co Ltd (097520 KS)

KOSDAQ Short/Loan Int: Pearl Abyss on Radar for Recent Bounce & Big Names KOSPI Moving

This post compiles weekly flow in short/loan interest for KOSDAQ stocks. It looks into Pearl Abyss for a substantial increase in loan interest and...

Sanghyun Park

Short-Selling Rule Change in Korea: Potential Names for Short Squeezing

Multiple news outlets in Korea have reported late last night that the Korea FSC would announce the first-phase measures of new restrictions for...

Sanghyun Park

Mcnex - A Leading Producer of Camera Modules for Smartphones and Autos

Mcnex Co Ltd (097520 KS) is a leading Korean manufacturer of camera modules for smartphones and autos. Our base case valuation for the company is...

Douglas Kim

A Comprehensive List of Korean Companies Benefiting from Sale of Level 3 Autonomous Vehicles in July

On January 5th, the South Korean government (Transport Ministry) announced that it will allow automakers to start selling vehicles with basic Level...

Douglas Kim

Cammsys ₩25bil BW Issuance Summary - Public Subscription Is Aug 7-8

Cammsys Corp (050110 KS) said in a regulatory filing on June 16 that it would sell ₩25bil (US$22 million) worth of debt with BWs. Its "tentative"...

Sanghyun Park

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)