This weekly newsletter pulls together summaries of the top ten most-read Insights across Event-Driven and Index Rebalance on Smartkarma.
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1. The Japan March-End Rebal and Dividend Trade
- Every year it’s the same trade. But sometimes it is not. This year it is Thursday and Friday. Or not.
- The month-end and quarter-end bring big flows, or not, depending on how things have gone.
- Over the past 10 years or so, the two-day return on the March trade is pretty good. This year? Well read on!
2. HKBN (1310 HK): MBK Ups Stake Via VLN Conversion
- China Mobile (941 HK) has made a pre-conditional HK$5.23/share voluntary Offer for HKBN Ltd (1310 HK). However, a possible separate Offer from I Squared continues to make the news.
- In an unusual move, MBK, via Twin Holding, has converted HK$970.5mn of VLNs, at a whopping HK$11.60/share conversion price, lifting MBK’s stake to 16.39% on a fully diluted basis.
- Speculation is rife that MBK provides an irrevocable to I Squared for its enlarged shareholding. Maybe. I still don’t see China supporting a U.S.-based infrastructure firm over an SOE .
3. [Activism Japan] Proto Corp (4298 JP) – Kaname Capital Files an Injunction? Bold Strategy, Cotton…
- Late on the 17th, Proto Corp (4298 JP) released a filing to the TSE saying activist-ish investor and objector to the current MBO, Kaname Capital, had filed an injunction.
- The injunction suit against two directors says procedures were unfair and the decision violated the duty of due care. They ask the Court to rule the directors halt support and…
- …that the MBO actor YOKOYAMA Hiroichi not terminate the offer on 21 March 2025. Injunction filings against directors for Tender Offers are rare for a reason.
4. Ramelius/Spartan Merger: MergeCo Close to ASX100 Index Inclusion
- Ramelius Resources (RMS AU) and Spartan Resources /Australi (SPR AU) have signed a binding Transaction Implementation Deed to enter into a ‘Transformational Combination’.
- For each share of Spartan Resources (SPR AU) held, shareholders will receive A$0.25 in cash and 0.6957 Ramelius Resources (RMS AU) shares, implying a value of A$1.78/share for Spartan Resources.
- The merger is expected to complete late July/ early August, and the merged entity could be added to the S&P/ASX 100 Index in September.
5. Maynilad Water (MYNLD PM): Index Inclusion Timing for a Large Philippines IPO
- Maynilad Water Services (MYNLD PH) is looking to raise up to US$860m by selling shares at ₱20/share, valuing the company at US$2.82bn.
- The market cap and free float will depend on the number of shares sold in the IPO and whether the shares in the upsize option are primary or secondary shares.
- Global index inclusions should take place in November and December, while Philippines Stock Exchange PSEi Index (PCOMP INDEX) inclusion could take place in August 2026.
6. DN Solutions IPO: Index Inclusion Timing Depends on Lock-Up Expiry Schedule
- DN Solutions (298440 KS) is looking to raise up to KRW 1,573bn (US$1.08bn), valuing the company at KRW 5.66 trillion (US$3.9bn) at the top end of the IPO price range.
- The highest probability of DN Solutions being added to the KOSPI200 Index is at the June 2026 rebalance. The stock needs to move 60% higher to be added in December 2025.
- Inclusion in global indices could commence in August/November and will depend on institutional investor lock-up schedules. Flows are small unless the stock moves higher and is included in bigger indices.
7. Canvest (1381 HK): Get Involved
- After SAFE gave the green light on the 19th Feb, I estimated only a week was required to secure the (strangely) outstanding internal guarantees. It took a frustrating three-and-a-half weeks.
- Nevertheless, all pre-cons are now done. Canvest Environmental (1381 HK)‘s Scheme Document is expected to be dispatched or before the 25th April.
- Assuming the Scheme gets up – and it will – expect payment around the 20th June. This is done.
8. ENN Energy (2688 HK): ENN Natural Gas to Launch a Privatisation Offer?
- ENN Energy (2688 HK) is in a trading halt “pending the issuance of an announcement pursuant to the Hong Kong Code on Takeovers and Mergers containing inside information of the Company.”
- ENN Natural Gas (600803 CH), also in a trading halt, is likely seeking to privatise ENN through a Cayman scheme. A high AGM minority participation necessitates an attractive offer.
- I use several methods to triangulate the likely offer price, which suggests a price range of HK$66.50-85.01, with an average of HK$76.04, a 28% premium to the last close.
9. Makino Milling Machine (6135 JP): Proposes Countermeasures
- The Makino Milling Machine Co (6135 JP) Board has proposed introducing countermeasures to nudge Nidec Corp (6594 JP) to delay the start of the tender to 9 May.
- The countermeasure was likely needed to facilitate a competing offer rather than force Nidec to provide the required information and delay the start (Nidec is still evaluating the request).
- Nidec’s offer at current terms has a low chance of success, necessitating revised terms. The Board claims that there is a sufficient probability of a competing proposal.
10. EcoNavista (5585 JP) – Takeover By Eisai (4523)
- EcoNaviSta (5585 JP) has a couple of interesting product lines and platforms. That makes it attractive, and scalable. Synergies to a big buyer are reasonably obvious.
- Eisai Co Ltd (4523 JP) is that big buyer, having decided to be interested last summer. I could imagine others could be interested too. The tech has uses.
- For the moment, it is a high EV/Revenue bid on an interesting small company. The chairman, cross-holders, directors, and a couple of financial institutions own 66+%. But…
This weekly newsletter pulls together summaries of the top ten most-read Insights across Equity Derivatives on Smartkarma.
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1. Tencent (700 HK): Expected Move on Profit Announcement and Option Insights
- Tencent (700 HK) / Tencent Holdings (ADR) (TCEHY US) is set to announce Annual 2024 Results on 19 March 2025.
- Options pricing implies a 4-6% move after earnings, significantly higher than historical patterns. From an options perspective, calendar spreads offer opportunities.
- Tencent‘s significant index weighting, around 8% in key Hong Kong indices, means its earnings has the potential to impact broader market performance.
2. Nikkei 225 Outlook After the Mar25 Rebalance
- The Nikkei 225 (NKY INDEX) has been in a paralyzed trend since August 2024. Then at the end of February 2025 it started to correct.
- As explained by Travis Lundy and Brian Freitas the index rebalance on March 5th, 2025 was a bit unexpected and minimal in terms of changes.
- The index bottomed 1 week after the March 2025 Nikkei 225 Average Review, and then started a rally, quite modest for now which could be signaling short-term tactical weakness.
3. Tencent Earnings: Implied Vs Realized Price Changes and a Post Earnings Pattern
- We take a detailed look at the implied earnings move priced into Tencent options compared to historical outcomes.
- Post-Earnings price movements are analyzed to assess directional tendencies and magnitude based on earnings beats and misses.
- An interesting post-earnings pattern emerges, with an options strategy outlined.
4. China Mobile (941 HK): Expected Move on Profit Announcement and Option Insights
- China Mobile (941 HK) / China Mobile (600941 CH) will release 2024 results on Thursday 20 March 2025.
- Historically, the stock shows minimal post-earnings volatility, with rare exceptions. Options markets project moderate movement. Opportunities exist for investors with strong directional conviction.
- Given China Mobile’s recent history of dividend increases and strong stock performance, a significant dividend boost is possible.
5. Ping An Insurance (2318 HK): 2024 Earnings, Divergence Between Option-Implied And Historic Move
- Ping An Insurance (2318 HK / 601318 CH) is set to announce Annual 2024 Results on 19 March 2025.
- Option markets are currently pricing in a significantly larger post-announcement price move than historical patterns would suggest.
- Two trade examples for calendar spreads, taking advantage of elevated near-term implied volatility, are presented.
6. NIFTY Tactical Outlook: Profit Target Is About To Be Reached, What’s Next?
- The NIFTY Index (NIFTY INDEX) has reached 22939 on Wednesday, our model indicates that if the index reaches the 23320 target, there would be a 75% probability of pullback.
- From the perspective of our time model, the index could continue to rise for at least 1 more week.
- We conclude that it’s possible that the index keeps rallying 1 more week towards 23320, then a pullback could start – for now the index seems stuck in its downtrend.
7. NSE NIFTY50/ Vol Update / IVs Subdued as Options Markets See Low Risk of U.S. Trade Tension Blowup.
- IVs remain subdued, trading sub-12% levels, as Option Markets expect low impact from U.S.-trade tensions. Risk premia compresses in spite of upcoming FOMC event risk.
- Vol term-structure has moved further into Contango. Realized Vol continues to underperform.
- Vol-Surface is exhibiting interesting behaviour as Skew has compressed while Smile has extended.
8. Meituan (3690 HK): Expected Move on Profit Announcement and Option Insights
- Meituan (3690 HK) is announcing 2024 Full Year Results on March 21, 2025, with historical data showing substantial price movement following earnings.
- The options market is pricing a 5-6% post-announcement move (below historical average), with the March 28 ATM straddle priced at 15.4-15.6, implying a 9.0% break-even by expiration.
- Three distinct option strategies are evaluated, considering an expected post-announcement drop in implied volatility.
9. Short Selling Resumes in Korea Just as the KOSPI 200 Braces for Pullback (Perfect Timing!)
- Short selling in all stocks in South Korea will resume from 31 March 2025. The KOSPI 200 (KOSPI2 INDEX EQUITY) is approaching the overboughtarea according to our models.
- If the KOSPI 200 can rise for another week, it would be perfectly ripe for a large, high probability SHORT trade.
- The probability of WEEKLY reversal in the range between the last Close (355) and the 363 resistance limit is between 50% and 75%, pretty high.
10. NIKE Q3 Earnings: Options Market Expectations and Post-Earnings Trends
- A detailed analysis of the earnings implied jump in Nike options compared to historical outcomes.
- Post-Earnings price movements are examined to assess directional tendencies and magnitude based on beats and misses.
- The third quarter stands out for the size of earnings-day moves, while earnings misses have shown a distinct post-earnings performance trend.
This weekly newsletter pulls together summaries of the top ten most-read Insights across Macro and Cross Asset Strategy on Smartkarma.
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1. UK Inflation Excess Survives Reweighting
- Updated inflation basket weightings can shift the inflation outlook without any new fundamental shock. The seasonal and trend outlook is unaffected by the 2025 update.
- Although our forecast is broadly unchanged, this still mitigates the risk that reduced weights on energy and sanitation utilities dampen the surge in April and July forecasts.
- This outcome further emboldens our confidence in our above-consensus forecast. We also note that the average import intensity is now weighted near historic lows.
2. BoE Dove Beaten Into Submission
- The BoE unsurprisingly held its policy rate at 4.5% in March, preserving its gradual easing path after resilient recent data. Only one MPC member dissented for a 25bp cut.
- Catherine Mann did not carry the extra 25bp of easing she supported from February to March. Her hyperactive vote relied on so little spurious evidence it was swiftly falsified.
- Core members emphasise the lack of a predetermined path, raising the hurdle to a May cut, but this remains the most likely outcome, even if it may require a rapid reversal.
3. EU: Defence Spending
- The EU is dealing with two crucial deadlines related to defence spending.
- The Commission is set to present its full loans-for-arms proposal to a divided European Council on 20 March.
- On 24 March, the ‘old’ Bundestag will step down, making it more difficult to ease Germany’s debt brake.
4. UK: Tight Jobs Market Persists Into 2025
- Unemployment remained at 4.4% in January amid rapid employment growth. Recent data suggest that the unemployment rate will likely decline over the next few months.
- Regular wage growth adhered to its 0.4% m-o-m trend. The headline is near 6%, leaving no progress over the past year. Financial sector bonuses weigh temporarily on total pay.
- Doves can temporarily dismiss this inconvenient resilience as unreliable noise, but the obvious risk is that it’s genuine and monetary stimulus has already become excessive.
5. Unloved Stocks in Asia Ex-Japan
- Bank Of China Ltd, Celltrion Inc and Li Auto top the list as the largest index constituents held by less that 5% of active Asia Ex-Japan funds.
- Unloved stock numbers increase after China A-share inclusion in 2018/19 and further amplified by post-2020 restrictions on select Chinese military-linked firms.
- Select funds do own sizeable positions in these stocks. Are they the ultimate contrarian trades?
6. Asian Equities: The Currency Tailwind – Where Would FII Flows Gravitate?
- The USD is moderating, not just against developed market currencies, but also against Asian currencies. Usually, Asian currency revival is a lead indicator of acceleration of FII flows in Asia.
- Our analysis of cumulative FII sales as proportion of market cap shows that Korea and Indonesia are oversold. India is almost there, but not quite. HK/China is still under-owned.
- Taiwan and Thailand, despite large FII selling over an extended period, are still not oversold. Both markets face risks from the tariff war and could face more FII selling pressure.
7. EM Fixed Income Focus: See no evil, hear no evil: EM is not yet pricing a lot of growth downside
- Discussion about concerns regarding a U.S. recession or growth slowdown
- Analysis of historical mentions of recession in news media compared to current levels
- Evaluation of EM credit market sensitivity to recessionary risks and market moves so far
This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.
8. Indonesia’s Middle-Class Squeeze a Long Time Coming
- Recent reports that the Indonesian middle class has shrunk should not have come as a surprise, given long-running sluggishness in household consumption and poverty.
- The problem goes beyond the pandemic dislocations: misguided reliance on extractive commodities sectors and a restrictive stance on foreign investments are primary culprits.
- Further squeezes on the middle class jeopardize Indonesia’s economic and political stability. Unfortunately, the government shows little sign of making the needed pivots.
9. Steno Signals #189 – The Perception Vs. Reality of Inflation: A Growing Divide
- Happy Monday from Copenhagen! We have a six-month stopgap funding deal in place in the U.S. until September, but no new debt ceiling legislation.
- So, despite a shutdown being avoided, we are not yet talking about a new mountain of debt.
- This is why I think the late-Friday reaction in bond yields was somewhat overdone.
10. The Drill: China to the commodity rescue?
- Welcome to our weekly editorial on everything Geopolitics and Commodities.
- Industrial metals (and precious metals) have performed very well this year, and we’ve thankfully been part of (parts of) this ride.
- With new signs emerging of a stimulus targeting consumption patterns in the economy, Wall Street’s takeaway has been that China has regained significant momentum.
This weekly newsletter pulls together summaries of the top ten most-read Insights across Tech Hardware and Semiconductor on Smartkarma.
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1. Silicon Wafers. Is It Time To Invest?
- Worldwide silicon wafer shipments decreased by 2.7% to 12,266 million square inches in 2024, details here. This follows a 14.3% decline in the prior year.
- Silicon wafer companies continue to trade at historic lows with two of the top four players sporting P/B ratios of 0.7. Intel’s P/B is presently 0.9. This makes little sense.
- The current depreciation headwinds triggered by a huge CapEx splurge from 2021-2024 will turn to tailwinds once demand recovers and built-ahead production capacity stands ready & waiting.
2. Taiwan Dual-Listings Monitor: TSMC Trading Range Breakdown? ChipMOS Discount Rare Long Opportunity
- TSMC: +14.1% Premium; Given Latest Market Weakness, Safest to Wait for a Slightly Lower Premium Before Going Long
- ASE: -1.8% Discount; Good Level to Go Long the Spread
- ChipMOS: -6.8% Discount: Long the Spread, Historical Extreme Discount Level
3. Taiwan Tech Weekly: If TSMC Joins Intel for Foundry, It Will Entrench Dominance; Structural Long
- TSMC Eyes Intel Foundry Joint Venture: Strategic Expansion or Risky Bet?
- TSMC Addresses U.S. Expansion Concerns: Strengthens TSMC Position & Positive for Semi Industry Capex
- MWC Barcelona Showcased The 6G Showdown: MediaTek Vs. Qualcomm in the Race for Wireless Supremacy
4. Intel Finally Gets A New CEO: Lip-Bu Tan. Now What?
- Lip-Bu Tan, former CEO of Cadence and founding partner at Walden Catalyst Ventures, will become Intel’s ninth CEO effective March 18
- Mr. Tan is an extremely impressive technology leader, speaker, & influencer with many and varied interests. He is an excellent choice for the most important CEO role in Intel’s history
- Press releases seem to emphasise Products over Foundry but any decision in this regard will take time so it doesn’t appear that Mr. Tan is simply following the board’s orders.
5. IS AI Spending Poised to Fall?
- Hyperscaler CapEx could be slowing down, based on 4Q24 spending
- Microsoft made a significant cut in Q4, but Amazon, Facebook, and Alibaba all made big increases
- Industry CapEx as a percent of revenue has slowed its growth
6. Silergy (6147.TT): 1Q25 Outlook Sales: Down QoQ but up QoQ. 2025 Outlook Sales: Up 20-30% YoY.
- 2025 outlook Sales: up 20-30% YoY. More certain on China demand recovery. Gradually enters Mass-Production (MP) for Gen 3/4 products. Main growth drivers are consumer and Electric Vehicle.
- Silergy targets for auto sales contributed to reach 15% in 2025.
- Will witness a rebound in 2Q25 for computing and Consumer and auto will also grow QoQ given resumption for production in China.
This weekly newsletter pulls together summaries of the top ten most-read Insights across Equity Capital Markets on Smartkarma.
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1. Samsung SDI Capital Raise: A Mega Deal Rarely Seen in the Local Market
- The discount’s tight, but this near-2-trillion-won raise is a rare mega-deal in Korea, despite the issuance ratio below 20%.
- Samsung Electronics is in for 150 billion won, but plenty of supply remains. A smooth clearance? Unlikely. This could drive stock rights costs lower as price discovery unfolds.
- The optimal approach is to wait for a decline in rights prices and assess hedge costs through single stock futures (or TRS, if doable), given the shorting restrictions.
2. ECM Weekly (10th Mar 2025) – BYD, Japan Post, Mixue, Sanhua, Chifeng, Nanshan, Goertek, Travel Food
- Aequitas Research’s weekly update on the IPOs, placements, lockup expiry and other ECM linked events that were covered by the team over the past week.
- On the IPO front, Mixue Group (2097 HK) provided some much needed relief to the HK tea chains, Seoul Guarantee Insurance (031210 KS) might not do the same this week.
- On the placements front, BYD (1211 HK)‘s jumbo offering has been doing well, while Japan Post Bank (7182 JP) hasn’t been correcting much.
3. Recruit Holdings Placement – Relatively Small US$520m Deal but Momentum Is Weak
- An undisclosed seller is looking to raise around US$520m via selling 0.5% of its stake in Recruit Holdings (6098 JP) .
- We have covered a number of placements in the stock over the past few years, most of which have ended up doing well.
- In this note, we will talk about the deal dynamics and run the deal through our ECM framework.
4. MIXUE Group (2097.HK) – Updates on Performance Forecast and Valuation Outlook
- MIXUE’s IPO debut was stellar. the IPO pricing of HK$202.5/share was indeed conservative. MIXUE is able to obtain more valuation premium space after IPO from a relatively low IPO pricing.
- However, concerns on future performance growth remains. Investors need to pay attention to the performance verification. Market sentiment is becoming “overheated”, and the pressure for short-term stock price corrections increases.
- We updated our forecast for 2025-2027. If based on P/E of 20-25x, market value is HK$109.4-136.8 billion, HK$122.5-153.2 billion, HK$134.8-168.5 billion based on 2025, 2026 and 2027 net profit, respectively.
5. Initial Thoughts on the Hanwha Energy IPO
- Hanwha Energy, which is 100% owned by the Hanwha Group owner family members, has started the process of going public. Hanwha Energy could complete its IPO in 2025/2026.
- One of the scenarios involving Hanwa Energy is that once it completes its IPO, it could merge with Hanwha Corporation (000880 KS).
- Hanwha Energy generated revenue of 4.7 trillion won (up 20% YoY) and operating profit of 215 billion won (up 306.5% YoY).
6. AvePoint SGX Secondary Listing – Strong Growth and Large Client Base but Unclear Metrics
- AvePoint (AVPT US) , a global provider of data security, governance, and resilience, aims to raise around US$300m in its Singapore secondary listing.
- As of FY24, AP had over 25,000 customers who rely on its Confidence Platform to prepare, secure, and optimize their critical data across environments.
- In this note, we look at its past performance and other deal dynamics that might impact the listing.
7. Chifeng Jilong A/H Trading – Weak Institutional Demand and Probably Close to Fair Value
- Chifeng Jilong Gold Mining (600988 CH) , a gold mining company in China, raised around US$363m in its H-share listing in Hong Kong.
- It operates six gold mines in Asia and Africa and has been listed on the Shenzhen Stock Exchange since 2004.
- We have covered the company and deal background in our previous notes. In this note, we talk about the trading dynamics.
8. Austal Placement: Thematically Hot, Relatively Low Valuation
- Austal Ltd (ASB AU) is looking to raise US$157m, with US$125m from a primary placement and the remainder, a secondary placement contingent on the primary being fully subscribed.
- The deal will be a large one to digest at 58 days of the stock’s three month ADV, representing 15.3% of its shares outstanding.
- In this note, we will talk about the placement and run the deal through our ECM framework.
9. Anjoy Foods Group A/H Listing – A Leader in a Fragmented Industry
- Anjoy Foods Group (603345 CH), a quick-frozen food company in China, aims to raise around US$300m in its H-share listing.
- AFG was the largest quick-frozen food company in China in terms of revenue in 2023, with a market share of 6.2%, according to the Frost & Sullivan report.
- In this note, we look at its past performance and other deal dynamics that might impact the listing.
10. DN Solutions IPO Preview
- DN Solutions is getting ready to complete its IPO in Korea in May 2025. The IPO price range is from 65,000 won to 89,700 won.
- The book building for the institutional investors will last from 22 to 28 April. The expected IPO offering amount is from 1.14 trillion won to 1.57 trillion won.
- The IPO price range is based on DN Solutions’ net profit of 317.4 billion won, P/E of 25.2x, and IPO discount rates of 29.1% to 48.6%.
This weekly newsletter pulls together summaries of the top ten most-read Insights across Event-Driven and Index Rebalance on Smartkarma.
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1. Rio Tinto (RIO AU/RIO LN): Unification Index Flows
- At the upcoming AGM, Rio Tinto Ltd and Rio Tinto PLC shareholders will vote on the company commencing a review on the benefits vs costs of Unification.
- Palliser Capital has been pushing for Unification while the Rio Tinto Board has recommended that shareholders vote against Resolution 21/24 citing tax costs among other reasons.
- If the Unification completes, S&P/ASX trackers will need to buy Rio Tinto Ltd (RIO AU) while UKX Index (UKX INDEX) trackers will sell Rio Tinto PLC (RIO LN). Net positive.
2. 7&I (3382) Update – Couche-Tard Responds
- On 10 March, Alimentation Couche-Tard (ATD CN) issued a release “UPDATE ON PROPOSAL FOR A COMBINATION WITH SEVEN & i“.
- They felt obliged to be transparent in the wake of the 7&i Letter To Shareholders released yesterday. The content/nuance of the two letters differ significantly.
- Two parties competing to get a truth which cannot be both could be problematic. We are still many months away from any kind of ACT/7-11 deal.
3. 7&I (3382) – Artisan Writes (Again) And 7&I Updates (Again) – More Positive Outlook Now
- On Thursday 6 March we got a Nikkei article then a company announcement for Seven & I Holdings (3382 JP)‘s proposed management measures and update on ACT Bid Process.
- It involved Isaka-san stepping down, Stephen Dacus stepping up, selling York to Bain for ¥814.7bn, IPOing 7-Eleven US, a ¥2trln share buyback over 5yrs, and ACT process update.
- It was OK. Good, bad, and ugly. But Artisan wrote a letter over the weekend and 7&i responded and suddenly, their concerns are mostly addressed and the outlook is different.
4. Rio Tinto (RIO AU/LN): Shareholders To Vote On Merits Of Unification
- Palliser Capital, which reportedly holds ~$300mn in Rio Tinto Ltd (RIO AU/LN) shares across its dual-head structure, has campaigned for near-on a year to unify the primary listing in Australia.
- Palliser’s reasonings (and others) to unify make sense, such as access to stock-based mergers and eliminating franking wastage. A recent independent assessment from Grant Thornton is also supportive of unification.
- Shareholders will vote on the resolution on 3rd April for UK-listed shares and 1st May for Australian-listed shares. The UK line holds the key to the vote outcome.
5. Proto Corp (4298 JP) – Activists Getting More Activish, Watch for Position Changes?
- The MBO for Proto Corp (4298 JP) where the founder/chair is buying out from minorities is being done at the wrong price. His reasons are good, but not for minorities.
- One large foreign shareholder – the second largest shareholder of the firm – has offered substantial pushback in the form of a letter asking for discussions. That went nowhere.
- So now they have come out harder. The solution here is a really big bump or a broken deal if investors keep the share price above the TOB price.
6. [Activism Japan] Nissan Tokyo Sales (8291) Gets An ‘Outsourced Activist’ but the Value Prop Remains
- On 12 March 2025, a minor Twitter account @nanahoshiuk started in January announced a website shiftnissantokyo.com where they point out the value proposition in Nissan Tokyo Sales (8291 JP).
- The writeup is by a UK company led by a young man with an equity-investing career, some experience at an activist shop, who now runs a “Shareholder Activism Outsourcing Service.”
- The content sounds familiar to my piece in December, has a few unpolished edges, but clearly points out the value proposition. The stock deserves a re-visit. My comments are below.
7. CK Hutch (1 HK): Still Trading Cheap
- To avoid a political landmine, on the 4th March CK Hutchison Holdings (1 HK) announced a deal with Blackrock to offload its entire port ops, including the contentious Panama ports.
- It’s an astute deal selling to a buyer, ostensibly backed by the Trump administration, at the top of the market, knowing global trade could fall under a new tariff regime.
- The risk to the transaction is one of timing. US/Panama approvals are a shoo-in. But it’s a complex deal, which will take time to work through the system.
8. Seven & I Holdings (3382 JP): Reading Between the Lines of the Public Letter
- The Seven & I Holdings (3382 JP) Board has released a public letter to address Artisan Partners’ letter and provide more details on the Alimentation Couche-Tard (ATD CN) constructive engagement.
- The letter effectively addresses most of Artisan’s concerns. The Board is engaging with Couche-Tard, particularly by agreeing on a strategy to find a solution to secure antitrust approvals.
- However, the statement suggests that the Board retains deep scepticism that the Couche-Tard is viable and is manoeuvring to shift the blame on a failed bid on a flawed proposal.
9. Properly Interpreting Korea’s Stock Borrow Data for Short Selling
- Local instos borrow from brokers or peers, KSD collects and cleans the data, then KOFIA reports stock borrow balances daily with a two-day lag.
- Offshore borrows via EquiLend or PB deals don’t show up—KSD reporting only covers local institution-to-institution stock loans.
- Assume 60% of reported borrow balance is real shortable ammo—adjusting for this helps filter out noise in short positioning.
10. Baudroie (4413 JP) – Fast Growth, Prime Promotion, and TOPIX Inclusion
- In late November of 2024, Baudroie (4413 JP) announced it would try to move to TSE Prime and that day they announced a 2.76mm share secondary offering and a buyback.
- The buyback was a bit less than a quarter of the offering. Fast forward 3mos and in early March the company announced it would move to Prime. Yesterday it did.
- That puts the company in line for a TOPIX inclusion in end-April , and likely other index effects later. In the meantime, earnings and guidance are out ~10 April.
This weekly newsletter pulls together summaries of the top ten most-read Insights across Equity Derivatives on Smartkarma.
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1. S&P/ASX 200 Index Outlook Post-Rebalance
- The S&P/ASX 200 (AS51 INDEX) has suffered a continuous sell-off for the past 3 weeks. The index is deeply oversold, our model predicts an imminent reversal.
- The reversal could lift the index to the 8091-8208 price area, but the index may start to fall again after that.
- As posted by Brian Freitas there has been 7 changes for the S&P/ASX 200 (index rebalance), read his insight for further details on this.
2. Samsung Electronics (005930 KS) Outlook After 278B Won Shares Block Deal Sale
- As reported by Douglas Kim, Samsung Life Insurance and Samsung Fire & Marine Insurance plan to sell shares of Samsung Electronics (005930 KS) in block deal sales.
- Samsung Electronics (005930 KS) has been in a flat, bottoming behavior, since November 2024. We have previously discussed the possibility that the stock may start to rally.
- At the moment the stock has been down for 3 weeks in a row, our model is indicating a WEEKLY oversold condition that may trigger a (short-term) rally.
3. AIA Group (1299 HK) Results Day: Expected Price Swings and Dividend Boost
- AIA Group (1299 HK) is set to announce its 2024 Annual Results on 14 March 2025, 09:00 am HK Time.
- AIA Group (1299 HK) has historically experienced volatile trading during results days, with a median move of +/- 4.2%, considerably higher than typical daily movements.
- AIA Group Ltd (1299 HK) will announce its final dividend. With a history of increases, a divided raise can be expected.
4. Bottom Fishing: SoftBank (9984 JP) Looks Attractive After -18% Drop
- Softbank Group (9984 JP) has lost nearly 18% of its stock value since February 7th. The stock has been falling for 4 weeks, our model indicates a very oversold condition.
- SoftBank’s has a number of strategic investments and initiatives that make it an attractive investment.
- Below, we outline key fundamental factors that align with our quantitative model’s view, suggesting the stock is oversold and could be a compelling buy at its current price.
5. JD.com (9618 HK) FY Earnings Recap: Intra-Day Swing of 7.3%.
- JD.com (9618 HK) Q4 2024 earnings significantly exceeded analyst expectations with revenue reaching RMB 347 billion (13.4% YoY increase).
- The stock experienced a volatile two-day reaction, rising 8.4% on March 6 followed by a 5.0% decline on March 7, resulting in a net gain of 3.03%.
- Options strategies including straddles, strangles, and call calendar spreads were actively traded ahead of earnings with potential intraday profitability. Longer dated implied volatility decreased following the announcement.
6. Dividends, Volatility, and Profits: HSI and HSCEI Heavyweights Reveal Results, 17 – 21 March
- Over a dozen Hang Seng Index companies (31% of index weight) report next week, along with significant portions of HSCEI (38%) and Hang Seng TECH Index (32%) components.
- The four index heavy-weights Xiaomi Corp, Tencent, China Mobile, and Meituan all report next week.
- Weekly options expiring March 21 provide targeted instruments for traders looking to capitalize on earnings-related price movements.
7. HSI Outpaces SPX — Structural Break or Head Fake? Strategies for Hedging
- HSI has surged past SPX, but past instances of strong outperformance have often preceded reversals. We examine key historical trends.
- The YTD divergence between HSI and SPX calls into question whether this is another temporary rally or the start of a new trend.
- We highlight some key hedging strategies to manage risk in this evolving market dynamic.
8. Xiaomi Earnings: Option Market Expectations, Past Performance and Hedge Opportunities
- Xiaomi earnings are upcoming. We analyze what the options market is pricing and examine historical trends and tendencies.
- Historical earnings reactions show notable differences across quarters, with Q4 standing out for its downside risk.
- We outline a tactical hedge that minimizes jump risk while taking advantage of extended implied volatility.
9. The Week Ahead in Options – 10 March
- US steel and aluminum tariffs (effective 12 March US time) will take effect on March 13 across the Asia-Pacific region. Volatility can be expected in Japan, South Korea, India, China.
- Major quarterly derivatives expirations will occur on March 13 in Japan (Nikkei 225, TOPIX, Stocks), South Korea (KOSPI 200, KOSDAQ 150, Stocks), and India (BSE Stock Futures and Options).
- Earnings announcements for AIA Group (1299 HK) and Li Auto (2015 HK/LI US) are scheduled for March 14, while India’s markets will be closed that day for the Holi holiday.
10. Nasdaq 100 (NDX INDEX) Poised for Rebound After 4-Week Slump
- The Nasdaq-100 Stock Index (NDX INDEX) has declined for 4 consecutive weeks. Our model suggests it has entered a price zone where a reversal is highly likely.
- Thursday’s closing low of 19,225 falls within a price zone where our WEEKLY NDX model assigns a 97% probability of reversal. It’s clearly in the tail area and deeply oversold.
- When the Nasdaq 100 declines for 4 consecutive weeks, our time model assigns a 98% probability of reversal based on the current historical pattern.
This weekly newsletter pulls together summaries of the top ten most-read Insights across Macro and Cross Asset Strategy on Smartkarma.
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1. US Lands Some Disinflation In Feb-25
- The upwards trend in monthly US inflation of the past several months broke in February with a surprisingly steep slowing to 0.2% m-o-m, although airfares drove the downside.
- Drift in consensus expectations is not yet obviously broken, with this outcome 0.2pp above forecasts from a month ago. A rebound after Easter remains likely.
- Disinflation is unlikely to dissuade the Fed from holding rates in March. We doubt soft surveys will translate to recessionary conditions, so we still see no more Fed cuts.
2. HEW: Payback In Trade And Pricing
- Equities are facing difficulties due to unpredictable trade policies and retaliations, which are affecting profit forecasts. Despite this, hard data remains strong, although low airfares are impacting the US CPI. There has been a decrease in optimism about Europe.
- The Federal Reserve and the Bank of England are likely to maintain current interest rates in the coming week as there are no clear signs of a downturn. Two MPC members are expected to dissent for a 25bp cut to avoid acknowledging a previous error.
- Other upcoming announcements include those from the Bank of Japan, the Swiss National Bank, and the Riksbank.
3. The Week Ahead – Tariffs Kick In; Europe Kicks Off With Fiscal Easing
- German fiscal announcement leads to increase in bond yields and euro rally
- US implements 25% tariffs on Canada and Mexico, additional tariffs on China
- China retaliates with tariffs on US energy products and adding American firms to unreliable entity list
This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.
4. Asian Equities: Preserving Capital in 2025 – Parallels and Contrasts from 2018
- As the trade war unfolds, more market volatility seems likely. In the 2018 episode China and Korea drove Asian drawdown. But today, China exports far less to America than earlier.
- The 2025 trade war is more expansive, with larger tariffs being imposed. In 2018, the defensives and non-tradables outperformed. Similar sectors, but not the same markets could do well now.
- Our Capital Preservation Basket presents eight cheap stocks with domestic revenue exposure and earnings estimate increases over past six months. They are from HK/China (5), Philippines (2) and Korea (1).
5. Volatility, Tariffs, and a Potential Recession: Breaking Down Macro Chaos | The New Barbarians #011
- Market volatility continues, with futures down across the board
- Atlanta Fed’s GDP nowcast turns negative for the first time since 2022
- Winners in the market so far this year include gold, European stocks, and bonds
This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.
6. Investors Run and Hide
- Investors are scrambling for safety as tariffs reshape the global financial order.
- Capital is flowing into short-term Treasuries at an increasing pace.
- Gold has been a steady haven, but will bitcoin also emerge as a safe haven.
7. ASIA: Portfolio Positioning During US Bear Market
- The US has entered the first leg of its bear market. Administration officials have taken a “no pain, no gain” stance, with policy priorities taking precedence over market moves.
- Sequencing problems start as tariffs and DOGE policies are enacted first, which negatively affect inflation and economic growth. Atlanta Fed GDPNow forecasts a recession within a year.
- Asian markets will be pulled down as part of the US risk-off trade. Regarding relative performance, HK/China will benefit from the underweight exposure of foreign funds and better valuations.
8. 2025 Global Investment Recommendations
- From a business cycle perspective, Trading Post is overweight global equities, and underweight sovereign bonds. Within global equities the bias is towards growth and momentum stocks.
- In favour are industrials, energy, European & US defence, tech hardware companies and consumer discretionary in the second half of the year, along with export cyclicals.
- Expect the Fed to cut interest rates once this year and the ECB by 125bp in total and for the BoJ to raise by 75bp.
9. The Sky Is Falling!?
- The recent decline in US equities only smells like a recession, might not taste like one yet
- Broader and timelier measures of the economy do not seem to be as soggy as the early indications from headline GDP at this time
- My weekly Recession Odds indicator, which takes into account a range of indicators with diversified coverage, offers another angle on the ongoing recession debate
10. Heavy Metal Trade War
- Volatility in US trade policy continues a cleaner tightening trend against China in the well-established tech war. Tariffs are a tool, but so are export restrictions.
- China expanded restrictions on rare earth mineral exports to license critical materials like tungsten. The West lacks friendly suppliers and struggles to develop alternatives.
- European defence investments may flounder. Japan and Korea may also suffer, so they can indirectly frustrate the US. Aggressive trade policy hits volumes as well as prices.
This weekly newsletter pulls together summaries of the top ten most-read Insights across Tech Hardware and Semiconductor on Smartkarma.
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1. Taiwan Tech Weekly: TSMC’s Expansion Visualized; Implications of New U.S. Investment; New HBM Memory
- TSMC’s Latest Global Expansion Plans, Visualized; Taiwan Manufacturing Will Continue to Remain One Generation Ahead of Overseas
- TSMC (2330.TT; TSM.US): Invest Further in US up to 100bn; Intel Foundry Service Gets Direct Clients.
- Memory Monitor: Nanya Tech Soared on DRAM Recovery and Custom HBM News
2. Former CEO Claims Intel Is Back & Says Can We Please Stop Talking About Breaking It Up?
- On March 1, ex Intel CEO Craig Barrett posted a rebuttal of his former board members opinion piece on the subject of the company’s future
- He claims that Intel is back, the company must not be broken up, the board should be fired and Mr. Gelsinger should be rehired to finish the job he started
- Meanwhile, Intel has put its Ohio fab on hold until the end of the decade, its German fab on hold for two years, both damning indictments of Mr Gelsinger’s strategy
3. Taiwan Dual-Listings Monitor: TSMC’s Range Declining; ASE Near Parity; ChipMOS Rare Discount
- TSMC: +18.5% Premium; Wait for Lower Premium Before Going Long
- ASE: +0.2% Premium; Near-Parity Premium is Opportunity to Long the Spread
- ChipMOS: -3% Discount; Rare Discount is Opportunity to Long the Spread
4. TSMC To Invest A Further $100 Billion In Arizona
- TSMC plans to invest $100 billion in the US to build three new fabs, two new advanced packaging facilities and establish an R&D centre, all in Arizona
- During the press conference at the White House, Mr Wei received fulsome praise from President Trump and was careful to thank him for his vision and support on multiple occasions
- The announcement lacked key details such as construction timelines and which process technologies would be deployed but it would still appear to have done the trick, at least for now.
5. TSMC Addresses U.S. Expansion Concerns: Strengthens TSMC Position & Positive for Semi Industry Capex
- TSMC just held a press conference this evening in Taiwan regarding its expanded U.S. investment plans. TSMC said it won’t impact Taiwan investments; it is actually accelerating its Taiwan investments.
- Additionally, we see TSMC’s aggressive U.S. expansion significantly weakening Intel’s ability to compete, as it removes one of Intel’s major differentiators–domestic U.S. production.
- Maintain Structural Long rating on TSMC — Expanded U.S. investment fortifies the company’s global leadership. ALSO — Positive news for semiconductor manufacturing equipment companies internationally and in Taiwan. ASML, etc.
6. TSMC (2330.TT; TSM.US): Invest Further in US up to 100bn; Intel Foundry Service Gets Direct Clients.
- On March 4th, Taiwan Semiconductor (TSMC) – ADR (TSM US) announced that the company will further increase its investment up to $100 billion in the US.
- The restructured case of Intel Corp (INTC US) has elicited different opinions, but a few companies may consider trying out Intel Foundry Service.
- Currently, we find these developments acceptable, although we view them as the result of political interference, and time will tell.
7. TSMC (2330.TT; TSM.US): TSMC Held Press Conference Regarding Further Investment of USD$100bn in US.
- TSMC Chairman Dr. CC Wei pointed out that TSMC builds production lines everywhere to meet customers’ demands. TSMC has never gone against this principle.
- On the 3rd of March, U.S. President Trump and TSMC Chairman jointly announced at the White House that TSMC would reinvest at least $100 billion in the U.S.
- Regarding concerns from the public that TSMC might gradually shift its production focus to the U.S., TSMC made it clear that this would not happen.
8. SMIC (981.HK): Speculation About the Deepseek Rumor Does Imply Continued Creative Works in the World
- There is speculation about Deepseek’s wafer manufacturing yield issue at Semiconductor Manufacturing International Corp (SMIC) (981 HK) these days.
- The potential concern serves as a signal for a hot topic within the company, carrying two underlying meanings.
- Although NVIDIA Corp (NVDA US) is making waves in AI applications, we must not overlook the potential for continued creative developments in the world, such as Deepseek’s solution.
9. MWC Barcelona Showcased The 6G Showdown: MediaTek Vs. Qualcomm in the Race for Wireless Supremacy
- The Stakes in the 6G Race: 100x Data Speeds & AI-Driven Networks
- Qualcom’s Strategy vs. Mediatek’s Gameplan to Win the 6G Battle — Takeaways from MWC 2025 in Barcelona
- Investment Takeaways: MediaTek vs. Qualcomm — Maintain Structural Long for Mediatek but Qualcomm Could Offer Near-Term Relative Value Play
10. GlobalWafers (6488.TT): An Uncertainty Exists Whether Si Wafer Is Included in US Custom Tax or Not.
- Regarding global silicon wafer market prices, Globalwafers (6488 TT) noted that the Long-Term Agreement (LTA) for 12-inch wafers primarily focuses on advanced process nodes, with prices remaining stable.
- In December 2024, Globalwafers (6488 TT) signed a final agreement with the U.S. Department of Commerce, expecting to receive a maximum subsidy of USD$406mn.
- Globalwafers (6488 TT) has not received any notifications regarding adjustments to chip policies.
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1. BYD US$5.2bn Placement – Large Only in Absolute Size, past Deals Have Done Well
- BYD (1211 HK) is looking to raise around US$5.2bn via selling 4% additional shares.
- The company has undertaken a few deals before and they have ended up performing well.
- In this note, we will talk about the placement and run the deal through our ECM framework.
2. Local Brokers Sound Off on 40% IPO Lock-Up—A Major Setup for Offshore Traders
- This 40% rule will distort bookbuilding, force down-pricing, choke float post-listing, and amplify volatility.
- Offshore investors like us benefit most—cheap IPO pricing with no lock-up. Local brokers see this as a giveaway to foreign funds and pushed back hard last Friday.
- FSS won’t budge—40% lock-up is happening. If issues arise post-implementation, they might adjust later.
3. Japan Post Bank US$4bn Deal Updates – Needs to Correct More. Discount Vs Deal Performance Analysis
- Japan Post Holdings (6178 JP) (JPH) aims to sell around US$4bn worth of Japan Post Bank (7182 JP) (JPB), trimming its stake to below 50%.
- JPH had last sold around US$9bn worth of JPB shares in Mar 2023. That deal had a similar structure and it didn’t end up performing well.
- We have looked at the deal dynamics in our previous notes. In this note, we talk about updates and look at discounts vs performance for past secondary deals.
4. JX Advance Metals IPO – Digestable, but Not Really Attractive
- JX Advanced Metals (5016 JP)’s parent, ENEOS Holdings (5020 JP), is looking to raise around US$2.5bn via selling more than half of its stake in JXAM in its Japan IPO.
- JXAM engages in business activities primarily focused on the development, manufacture and sale of materials made from copper and rare metals, which are used in the semiconductor and ICT fields.
- We have covered various aspects of the deal in our previous notes. In this note, we will talk about the IPO pricing.
5. JX Advanced Metals IPO Preview
- JX Advanced Metals (5016 JP) is seeking to raise about ¥460 billion in the upcoming IPO on the Tokyo Stock Exchange. The indicative IPO price is ¥862 per share.
- The final IPO pricing will be on 10 March. JX Advanced Metals will be listed on 19 March. Eneos is selling as many as 534.9 million shares in the IPO.
- The company has a strong customer base. It is a key supplier to TSMC, Samsung, Intel, SK Hynix, and Micron for sputtering targets and high-purity metals.
6. Japan Post Bank (7182 JP) – Not Cheap Enough Vs Others, or Holdings
- The Offering of Japan Post Bank (7182 JP) is not taking place the way “the right pattern” would suggest, but last time was kind of special. This time is different.
- Last time was a “second IPO” and coincided with a US regional bank crisis. This time the offering is smaller outright, and much smaller as a portion of float.
- Pricing is Monday. It hasn’t moved much vs JPH. It needs to move more to be attractive. And there is still a bit of overhang to come.
7. Japan Post Bank (7182 JP): The Current Playbook
- Since the offer announcement, Japan Post Bank (7182 JP)/JPB’s shares have declined by 2.5%. On 3 March, JPB completed the ToSTNeT-3 buyback by acquiring 13.3 million shares for JPY20 billion.
- To understand JPB’s trading pattern, it is instructive to examine its 2023 offering, Japan Post Insurance (7181 JP)/JPI’s 2019 offering, and Japan Post Holdings (6178 JP)/ JPH’s 2021 offering.
- JPB’s shares follow the trading pattern playbook of its 2023 and JPH’s 2021 offerings, in which investors buying the offer were rewarded with positive returns at the payment date.
8. Chifeng Jilong A/H Listing: Why Not Own International Peers Instead?
- Chifeng Jilong Gold Mining (600988 CH) , a gold mining company in China, is now looking to raise up to US$419m in its H-share listing in Hong Kong.
- It operates six gold mines in Asia and Africa and has been listed on the Shenzhen Stock Exchange since 2004.
- We have covered the company and deal background in our previous notes. In this note, we talk about the IPO pricing.
9. JX Advanced Metals IPO Valuation Analysis
- On 3 March, JX Advanced Metals (5016 JP) announced that the IPO will be offered at ¥810 to ¥820 per share (down from the initial indicative price of ¥862 per share).
- Our base case valuation per share is ¥863 which is 5.8% higher than the mid-point of the expected IPO price range of ¥810 to ¥820 per share.
- Given the lack of upside, we have a Negative view of this JX Advanced Metal IPO.
10. JX Advanced Metals (5016 JP) IPO: Price Range Is Fair
- JX Advanced Metals (5016 JP) has announced an IPO price range of JPY810-820 per share, which is 6.0%-4.9% below the IPO reference price range of JPY862.
- Relevant notes – JX Advanced Metals (5016 JP) IPO: The Bull Case, JX Advanced Metals (5016 JP) IPO: The Bear Case and JX Advanced Metals (5016 JP) IPO: Valuation Insights.
- My SoTP valuation of JPY860 is modestly above the IPO price range, suggesting that the price range is fair.