Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

Event-Driven

<ul>
<li>Some of the minority shareholders are fiercely protesting SK D&amp;D’s decision to launch a massive capital increase amounting to 240% of its outstanding shares. </li>
<li>The projected rights offering price of 3,060 won is 33% discount to current price of 4,575 won. </li>
<li>I am Negative on this rights offering and on SK D&amp;D. Issuing shares at significant discount to current price that are 240% of outstanding shares is negative to minority shareholders.</li>
</ul>


Some of the minority shareholders are fiercely protesting SK D&amp;D’s decision to launch a massive capital increase amounting to 240% of its outstanding shares. 
The projected rights offering price of 3,060 won is 33% discount to current price of 4,575 won. 
I am Negative on this rights offering and on SK D&amp;D. Issuing shares at significant discount to current price that are 240% of outstanding shares is negative to minority shareholders.


SK D&D: Destroying Value or Preventing a Bankruptcy? [Capital Raise of 240% of Issued Shares]

<ul>
<li>SK D&amp;D announced the results of the delisting tender offer by Hahn &amp; Co. SK &amp;D mentioned that the subscription reached only 40% of the planned tender offer amount.</li>
<li>Post failed tender offer for SK D&amp;D by Hahn &amp; Co, we expect this to have a positive impact on SK D&amp;D's share price.</li>
<li>The major reason for this is that there are still many investors that believe that SK D&amp;D's shares are significantly undervalued at P/B of only 0.4x.</li>
</ul>


SK D&amp;D announced the results of the delisting tender offer by Hahn &amp; Co. SK &amp;D mentioned that the subscription reached only 40% of the planned tender offer amount.
Post failed tender offer for SK D&amp;D by Hahn &amp; Co, we expect this to have a positive impact on SK D&amp;D's share price.
The major reason for this is that there are still many investors that believe that SK D&amp;D's shares are significantly undervalued at P/B of only 0.4x.


SK D&D: Delisting Tender Offer by Hahn & Co Fails - What's Next?

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>Strategically, range trade <a href="https://www.smartkarma.com/entities/seven-i-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:1041:1" rel="noopener">Seven &amp; I Holdings (3382 JP)</a>. Sell large pops, buy large declines. Big picture this big buyback  doesn't change very much at all on a net basis.</li>
<li>
<a href="https://www.smartkarma.com/entities/legend-holdings-corporation-class-h" target="_blank" data-smartkarma-citation="entities:517:1" rel="noopener">Legend Holdings (3396 HK)</a>(finally) sees a decent move. The positive profit alert issued no doubt nudge things along nicely. </li>
<li>Post sale to Heidelberg, how much, if any, will the market re-rate <a href="https://www.smartkarma.com/entities/maas-group-holdings-ltd" target="_blank" data-smartkarma-citation="entities:33520:1" rel="noopener">MAAS Group Holdings (MGH AU)</a> as an infrastructure/ "AI-enabler" rather than a contractor currently?</li>
</ul>


Strategically, range trade Seven &amp; I Holdings (3382 JP). Sell large pops, buy large declines. Big picture this big buyback  doesn't change very much at all on a net basis.

Legend Holdings (3396 HK)(finally) sees a decent move. The positive profit alert issued no doubt nudge things along nicely. 
Post sale to Heidelberg, how much, if any, will the market re-rate MAAS Group Holdings (MGH AU) as an infrastructure/ "AI-enabler" rather than a contractor currently?


Last Week In Event SPACE: Seven & I, Legend Holdings, MAAS, Lynas Corp

Cross Asset Strategy

<div class="content-highlight">
On 9 April, the <a href="https://www.reuters.com/article/southkorea-nps/update-1-s-koreas-pension-fund-adjusts-rules-to-raise-domestic-equity-allocation-idUSL1N2M20EN" target="_blank" rel="noopener">NPS</a> announced that it will change rules to increase the allocation of Korean stocks, which would be the first time in a decade. This adjustment could be implemented starting next week. This change comes after a lot of pressure by the retail investors.
NPS increased the strategic asset allocation (SAA) limit for domestic equities from the current 2% to 3%, increasing the percentage of Korean stocks it can hold from the current band of 14.8% -18.8% (+/- 2% with 16.8% as base) to 13.8% -19.8% (+/- 3% with 16.8% as base). NPS's target of the domestic equity allocation is 16.8% (of total fund amount). As a result of this change, the sale of domestic stocks by the NPS is expected to slow down.
</div>


On 9 April, the NPS announced that it will change rules to increase the allocation of Korean stocks, which would be the first time in a decade. This adjustment could be implemented starting next week. This change comes after a lot of pressure by the retail investors.
NPS increased the strategic asset allocation (SAA) limit for domestic equities from the current 2% to 3%, increasing the percentage of Korean stocks it can hold from the current band of 14.8% -18.8% (+/- 2% with 16.8% as base) to 13.8% -19.8% (+/- 3% with 16.8% as base). NPS's target of the domestic equity allocation is 16.8% (of total fund amount). As a result of this change, the sale of domestic stocks by the NPS is expected to slow down.


The Korea Exchange announced its KOSDAQ150 and KRX300 indices rebalances today. There were 17 new additions and 17 deletions for KOSDAQ150. Most of the stocks that were expected to be included in KOSDAQ 150 were officially included in the rebalance. However there were a few surprises. For example <a href="https://www.smartkarma.com/entities/nanos-co-ltd" target="_blank" data-smartkarma-citation="entities:16796:1" rel="noopener">Nanos Co Ltd (151910 KS),</a>which was one of the stocks that was expected to be included in KOSDAQ150, did not get included in this indext this time. On the other hand, the following stocks including <a href="https://www.smartkarma.com/entities/sang-a-frontec-co-ltd" target="_blank" data-smartkarma-citation="entities:20692:1" rel="noopener">Sang A Frontec (089980 KS)</a>, Novarex (194700 KS(, CIS (222080 KS), MedPacto (215980 KS), <a href="https://www.smartkarma.com/entities/koreacenter-com-co-ltd" target="_blank" data-smartkarma-citation="entities:28329:1" rel="noopener">Koreacenter.com Co Ltd (290510 KS)</a>, and Soulbrain (357780 KS) which were not on the top of the lists of getting selected into the KOSDAQ150 index by the locals, were formally selected be part of the new KOSDAQ150 inclusions.  The Korea Exchange also made changes to the KRX300 index. Although the KRX300 index is not currently as important as KOSPI200 and KOSDAQ150 indices, it is increasingly gaining in importance among the local institutional investors. The KRX300 had 33 new additions and 35 deletions.

The Korea Exchange announced its KOSDAQ150 and KRX300 indices rebalances today. There were 17 new additions and 17 deletions for KOSDAQ150. Most of the stocks that were expected to be included in KOSDAQ 150 were officially included in the rebalance. However there were a few surprises. For example Nanos Co Ltd (151910 KS),which was one of the stocks that was expected to be included in KOSDAQ150, did not get included in this indext this time. On the other hand, the following stocks including Sang A Frontec (089980 KS), Novarex (194700 KS(, CIS (222080 KS), MedPacto (215980 KS), Koreacenter.com Co Ltd (290510 KS), and Soulbrain (357780 KS) which were not on the top of the lists of getting selected into the KOSDAQ150 index by the locals, were formally selected be part of the new KOSDAQ150 inclusions.  The Korea Exchange also made changes to the KRX300 index. Although the KRX300 index is not currently as important as KOSPI200 and KOSDAQ150 indices, it is increasingly gaining in importance among the local institutional investors. The KRX300 had 33 new additions and 35 deletions. 

KOSDAQ150 and KRX300 Indices Rebalances (Overlapping Additions & Deletions)

South Korea

SK D&D Co., Ltd. engages in real estate development.  The Company is primarily engaged in non-residential property development and renewable energy development.

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SK D&D Co Ltd (210980 KS)

SK D&D: Destroying Value or Preventing a Bankruptcy? [Capital Raise of 240% of Issued Shares]

Some of the minority shareholders are fiercely protesting SK D&D’s decision to launch a massive capital increase amounting to 240% of its...

Douglas Kim

SK D&D: Delisting Tender Offer by Hahn & Co Fails - What's Next?

On 2 November, it was reported that Hahn & Co is launching a second tender offer for shares of SK D&D. Hahn & Co will be conducting a second tender...

Douglas Kim

Last Week In Event SPACE: Seven & I, Legend Holdings, MAAS, Lynas Corp

It’s Sunday! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed during the...

David Blennerhassett

NPS Raises Domestic Equity Allocations

NPS increased the strategic asset allocation (SAA) limit for domestic equities from the current 2% to 3%. As a result of this change, the sale of...

Douglas Kim

KOSDAQ150 and KRX300 Indices Rebalances (Overlapping Additions & Deletions)

We highlight the KOSDAQ150 and KRX300 indices rebalances. There are some interesting new names, especially among those that are over lapping in...

Douglas Kim

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