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

<ul>
<li>Hynix could announce KRW 100tn shareholder returns this week, with a 60:40 dividend buyback mix. Yeouido is increasingly positioning for this outcome.</li>
<li>KRW 40tn buyback matches the ADR proceeds, with Hynix repurchasing below the issuance price. The broader package also creates a timely window to upstream excess cash to SK.</li>
<li>Square looks set to outperform Hynix near term as the return mix reinforces the cash upstreaming narrative. A long Square, short Hynix or market setup looks compelling into the announcement.</li>
</ul>


Hynix could announce KRW 100tn shareholder returns this week, with a 60:40 dividend buyback mix. Yeouido is increasingly positioning for this outcome.
KRW 40tn buyback matches the ADR proceeds, with Hynix repurchasing below the issuance price. The broader package also creates a timely window to upstream excess cash to SK.
Square looks set to outperform Hynix near term as the return mix reinforces the cash upstreaming narrative. A long Square, short Hynix or market setup looks compelling into the announcement.


Hynix Dividend Heavy Return Likely Friday: Square Outperformance Setup in Focus

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

Equity Bottom-Up

<ul>
<li>My updated NAV analysis of SK Square suggests a target price of 1,378,127 won (42% upside). SK Square's stake in SK Hynix is 172% of its market cap.</li>
<li>Assuming SK Hynix provides 65.2 trillion won in 2026 shareholder returns split equally between dividends and buybacks, each portion would total 32.6 trillion won.</li>
<li>SK Square's shareholder return policy is a bit vague. The company needs to better communicate its shareholder return policy. </li>
</ul>


My updated NAV analysis of SK Square suggests a target price of 1,378,127 won (42% upside). SK Square's stake in SK Hynix is 172% of its market cap.
Assuming SK Hynix provides 65.2 trillion won in 2026 shareholder returns split equally between dividends and buybacks, each portion would total 32.6 trillion won.
SK Square's shareholder return policy is a bit vague. The company needs to better communicate its shareholder return policy. 


SK Square: An Updated NAV Analysis + A Key Beneficiary of Higher Shareholder Returns by SK Hynix

<ul>
<li>Hynix has bought back 3.25mn shares, or 13.5%, in six days. At the current 650K daily pace, it should finish October 19, a month ahead of the November 19 deadline.</li>
<li>The early buyback finish is not unusual, but its timing near the October 8 ADR lockup expiry revives chatter around a potential follow on ADR issuance.</li>
<li>Square could sell the 68bp stake via a secondary ADR, potentially funding a special dividend for Chey's ₩1T divorce settlement. Watch September filings for fungibility signals and ADR arb timing.</li>
</ul>


Hynix has bought back 3.25mn shares, or 13.5%, in six days. At the current 650K daily pace, it should finish October 19, a month ahead of the November 19 deadline.
The early buyback finish is not unusual, but its timing near the October 8 ADR lockup expiry revives chatter around a potential follow on ADR issuance.
Square could sell the 68bp stake via a secondary ADR, potentially funding a special dividend for Chey's ₩1T divorce settlement. Watch September filings for fungibility signals and ADR arb timing.


Dynamics Between Hynix’s Buyback Pace and Opening up ADR Fungibility

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

<ul>
<li>
<a href="https://www.smartkarma.com/entities/sk-hynix-inc" target="_blank" data-smartkarma-citation="entities:16955:1" rel="noopener">SK Hynix (000660 KS)</a> / <a href="https://www.smartkarma.com/entities/sk-hynix-inc-a4e8e2ec-1a75-4752-b58c-eaa0d074d145" target="_blank" data-smartkarma-citation="entities:50283:1" rel="noopener">SK Hynix (SKHY US)</a> announces earnings on 29 July. Expectations are for the company to announce a buyback or a special dividend.</li>
<li>A buyback will provide <a href="https://www.smartkarma.com/entities/sk-hynix-inc" target="_blank" data-smartkarma-citation="entities:16955:1" rel="noopener">SK Hynix (000660 KS)</a> with an option to issue more ADSs, something that they cannot do as things stand.</li>
<li>A buyback and the subsequent issuance of ADSs will help keep the ADS premium under control and reduce volatility transmission from the US markets to the local listing.</li>
</ul>



SK Hynix (000660 KS) / SK Hynix (SKHY US) announces earnings on 29 July. Expectations are for the company to announce a buyback or a special dividend.
A buyback will provide SK Hynix (000660 KS) with an option to issue more ADSs, something that they cannot do as things stand.
A buyback and the subsequent issuance of ADSs will help keep the ADS premium under control and reduce volatility transmission from the US markets to the local listing.


SK Hynix (000660 KS; SKHY US): Buyback Provides More Optionality than a Special Div

<ul>
<li>Local chatter says government is pushing early Hynix Samsung shareholder return amid KOSPI weakness. Buybacks would signal support at current levels, counter supply driven memory downside.</li>
<li>Hynix cited ADR quiet period as reason for limited disclosure, likely tied to Rule 174d window ending August 4. Market expects buyback post expiry, with positioning already tightening Square/Hynix spread.</li>
<li>Chatter sees Hynix disclosing buyback size and timing soon, likely phased with policy unchanged. Government pressure supports earlier rollout; stay long narrative and lean into Square Hynix pair.</li>
</ul>


Local chatter says government is pushing early Hynix Samsung shareholder return amid KOSPI weakness. Buybacks would signal support at current levels, counter supply driven memory downside.
Hynix cited ADR quiet period as reason for limited disclosure, likely tied to Rule 174d window ending August 4. Market expects buyback post expiry, with positioning already tightening Square/Hynix spread.
Chatter sees Hynix disclosing buyback size and timing soon, likely phased with policy unchanged. Government pressure supports earlier rollout; stay long narrative and lean into Square Hynix pair.


Square Spread Compression on Early August Hynix Buyback Narrative

South Korea

SK Square Co., Ltd. operates as an investment company. The Company invests in semiconductors, information and communications technologies, and other industries. SK Square conducts businesses in South Korea.

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SK Square (402340 KS)

Hynix Dividend Heavy Return Likely Friday: Square Outperformance Setup in Focus

Dividend disclosure is locked for the late October 3Q earnings call. The key swing factor is the special dividend, with local chatter now pointing...

Sanghyun Park

SK Square: An Updated NAV Analysis + A Key Beneficiary of Higher Shareholder Returns by SK Hynix

My updated NAV analysis of SK Square suggests a target price of 1,378,127 won (42% upside). SK Square's stake in SK Hynix is 172% of its market cap.

Douglas Kim

Dynamics Between Hynix’s Buyback Pace and Opening up ADR Fungibility

This post looks at the dynamics between Hynix’s buyback pace and the potential opening up of ADR fungibility, based on local market chatter.

Sanghyun Park

SK Hynix (000660 KS; SKHY US): Buyback Provides More Optionality than a Special Div

Hynix has announced a KRW 40tn buyback that will run over the next 3 months. The company can buy a max of 2.4m local shares a day. At the last...

Brian Freitas

Square Spread Compression on Early August Hynix Buyback Narrative

This post examines SK Square spread compression driven by expectations around an early August Hynix buyback announcement.

Sanghyun Park

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