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Smartkarma Daily Briefs

Jul 04
0

Daily Brief Thematic (Sector/Industry): China’s Semi Mega Push Is Inevitable. But Is It Investable? Part 1. and more

By | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

  • China’s Semi Mega Push Is Inevitable. But Is It Investable? Part 1.
  • Ohayo Japan| SPX Gains Despite Weak Factory PMI; NUGGET: Japan’s GX Promotion Law – Opportunity !
  • [Blue Lotus Macro]: Economic Stimulus Shouldn’t Be Pain Killers
  • China TMT Update Jul.4-2252HK/1801HK/LEGN/LKNCY:14th Five-Year Plan for Medical Equipment Allocation

China’s Semi Mega Push Is Inevitable. But Is It Investable? Part 1.

By William Keating

  • The growth of China’s semiconductor industry is inevitable and ever increasing sanctions on advanced semi supply chain components are adding fuel their self-sufficiency aspirations
  • Most Chinese semi stocks P/E ratios are sky high & volatile to boot. Many US semi stocks have peaked as far as their exposure to China growth is concerned. 
  • One sub-segment of the WFE sector may provide China semi growth exposure at reasonable valuation with relatively low risk. 

Ohayo Japan| SPX Gains Despite Weak Factory PMI; NUGGET: Japan’s GX Promotion Law – Opportunity !

By Mark Chadwick

  • OVERSEAS. SPX eakes out gains despite weak ISM Manufacutring in light trading ahead of July 4th Independence Day Holiday; TESLA +6.9% on big 2Q delivery numbers
  • JAPAN. NKY Futs -0.4% vs Cash; JPYUSD 144.7; Strong BOJ Tankan print drives NKY to new highs;  JP land prices continue to rise; Support for JP foundry goals from IBM
  • NUGGET.  Japan’s passing of the GX Promotion Law enables the issuance of ¥20 trillion in bonds and promotes ¥150 trillion of decarbonization investment over the next decade. Investment opportunities abound!

[Blue Lotus Macro]: Economic Stimulus Shouldn’t Be Pain Killers

By Shawn Yang

  • A collapse of real estate speculation destroyed the balance sheets of Chinese households, leading to downward spiral in consumptions. A tremendous stimulus package can reflate the economy, 
  • But it doesn’t solve the structural problems; Unlike semiconductor and biotech, inputs to renewable energy are many and supply chains are long.  To stay ahead, Chinese companies must keep themselves 
  • Cost competitive,  which means they can neither realize profits nor retaliate US containments. But their equities offer the long-term hope to replace real estate as nest eggs of Chinese retirees.

China TMT Update Jul.4-2252HK/1801HK/LEGN/LKNCY:14th Five-Year Plan for Medical Equipment Allocation

By Shawn Yang

  • 2252HK:   NHC issued the “14th Five-Year Plan for Large-Scale Medical Equipment Allocation” ,  the planned quota of laparoscopic robots is slightly lower than our estimated (-)
  • 1801HK/LEGN:Innovent/ISAO co-developed CAR-T received approval in China ahead   of Legend’s CARVIKTI, might try to squeeze in NDRL list this year (+)
  • LKNCY: Luckin Coffee reported 50mn monthly transacting customers in June(/)

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Jul 04
0

Daily Brief ESG: Faurecia – ESG Report – Lucror Analytics and more

By | Daily Briefs, ESG

In today’s briefing:

  • Faurecia – ESG Report – Lucror Analytics
  • What Changes in the External Environment Are Changing the Mindset of Managers?

Faurecia – ESG Report – Lucror Analytics

By Charles Macgregor

Lucror Analytics’ ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).
We assess Faurecia’s ESG as “Strong”, in line with the Environmental, Social and Governance scores. Controversies are “Immaterial” and Disclosure is “Strong”.

What Changes in the External Environment Are Changing the Mindset of Managers?

By Aki Matsumoto

  • Given the history of changes in the external environment that have changed managers’ mindsets all at once, inflation and rising foreign shareholdings are likely to be the catalysts for change.
  • Given that some companies still do not show capital efficiency as a KPI, it is dangerous to expect much from individual companies’ efforts to improve capital efficiency.
  • Whether or not to engage in management improvement is a matter for managers, but the catalyst is often an increase in foreign shareholdings. Changes are taking place in some companies.

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Jul 04
0

Daily Brief Credit: Morning Views Asia: MGM China Holdings and more

By | Credit, Daily Briefs

In today’s briefing:

  • Morning Views Asia: MGM China Holdings, Sino-Ocean Service, Vedanta Resources

Morning Views Asia: MGM China Holdings, Sino-Ocean Service, Vedanta Resources

By Charles Macgregor

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

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Jul 04
0

Daily Brief ECM: Fadu IPO Preview and more

By | Daily Briefs, ECM

In today’s briefing:

  • Fadu IPO Preview
  • Black Sesame Pre-IPO Tearsheet
  • TRYT IPO: Valuation Insights
  • Senco Gold Ltd IPO- Forensic Analysis
  • China Designer of AI-Based Self-Driving Chips Files for Hong Kong IPO
  • Pre-IPO Wuhan YZY Biopharma – Both R&D and Commercialization Capabilities Have yet to Be Proven
  • SF Holdings A/H Listing – Early Look – Front Running
  • Amman Mineral International IPO Trading – Looks Attractive with Ample Upside
  • Qiniu Pre-IPO Tearsheet

Fadu IPO Preview

By Douglas Kim

  • Fadu is getting ready to complete its IPO in Korea in August. Fadu is one of the most highly anticipated IPOs in Korea in 2023. 
  • The expected market cap at the top end of the IPO price range is 1.6 trillion won. The IPO price range is from 26,000 won to 31,000 won.
  • Fadu is a system semiconductor fabless company specializing in data centers.

Black Sesame Pre-IPO Tearsheet

By Sumeet Singh

  • Black Sesame International Holdings (BSIH) is looking to raise around US$300m in its upcoming Hong Kong IPO. The deal will be run by CICC and Huatai.
  • BSIH is an automotive-grade computing SoC and SoC-based intelligent vehicle solution provider. 
  • In terms of shipment of automotive-grade high-computing power SoCs in 2022, it was the third largest provider globally, according to Frost & Sullivan.

TRYT IPO: Valuation Insights

By Arun George

  • Tryt Inc (9164 JP), a leading professional recruiting and temporary staffing service in Japan, seeks to raise US$450 million. Pricing is on 5 July, and book-building is 6-11 July.
  • We previously discussed the IPO in TRYT IPO: The Bull Case and TRYT IPO: The Bear Case. 
  • In this note, we discuss valuation. Our analysis suggests that Tryt is unattractively valued at the IPO reference price of JPY1,620 per share. We would pass on the IPO.

Senco Gold Ltd IPO- Forensic Analysis

By Nitin Mangal

  • Senco Gold (0655443D IN) ‘s long awaited IPO is scheduled to open this week.
  • The company is the largest organized retail jewellery player in the East and has a pan India presence. 
  • A look at its IPO filing and current financials reveal several key takeaways, including ongoing litigations, inability to generate cash and register key trademarks, etc.

China Designer of AI-Based Self-Driving Chips Files for Hong Kong IPO

By Caixin Global

  • Black Sesame International Holding Ltd., a Xiaomi-backed designer of artificial intelligence-based self-driving computing chips, has filed for a Hong Kong IPO
  • Black Sesame, which also counts Tencent Holdings Ltd. and SAIC Motor Corp. Ltd. among its major investors, plans to use the IPO proceeds mainly to develop system-on-a-chip (SoC) designs and software for intelligent vehicles in the next three years.
  • Bloomberg in January reported that the company expects to raise $200 million through the share sale, citing people familiar with the matter.

Pre-IPO Wuhan YZY Biopharma – Both R&D and Commercialization Capabilities Have yet to Be Proven

By Xinyao (Criss) Wang

  • YZY is a company that is serious about drug development However, there is actually high R&D risk of its pipeline candidates. So, YZY’s R&D capability has yet to be proven.
  • There are still many unanswered questions in the whole direction of bispecific antibody. If YZY’s candidates fail to prove better marginal clinical benefits, they won’t have good commercialization performance. 
  • YZY has a long way to go based on its pipeline situation. Considering Wuhan YZY Biopharma (YZY HK) has no product in commercialization stage, its valuation may not be high.

SF Holdings A/H Listing – Early Look – Front Running

By Sumeet Singh

  • S.F. Holding (002352 CH) (SFH), China’s largest express delivery company, aims to raise around US$2-3bn in its H-share listing in Hong Kong.
  • SFH is the largest integrated express logistics service provider in China and the fourth largest in the world. It has been listed on the Shenzhen Stock Exchange since 2017
  • In this note, we look at its past performance and other deal dynamics that might impact the listing.

Amman Mineral International IPO Trading – Looks Attractive with Ample Upside

By Ethan Aw

  • Amman Mineral Internasional (1416286D IJ) raised around US$714m in its Indonesian IPO.
  • Amman Mineral International (AMI) carries out exploration, development, mining, processing. The company operates an open pit copper and gold mine known as the Batu Hijau mine in Indonesia.
  • In this note, we will talk about the trading dynamics and valuation.

Qiniu Pre-IPO Tearsheet

By Clarence Chu

  • Qiniu Limited (1045102D CH) is looking to raise about US$200m in its upcoming Hong Kong IPO.
  • Qiniu Limited (Qiniu) is a one-stop scenario-based intelligent audiovisual service provider.
  • According to iResearch, the firm is the third largest audiovisual platform as a service (PaaS) provider in China in terms of FY22 revenue, with a market share of 5.7%. 

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Jul 04
0

Daily Brief Equity Bottom-Up: Shortlist Of High Conviction Ideas: Income and more

By | Daily Briefs, Equity Bottom-Up

In today’s briefing:

  • Shortlist Of High Conviction Ideas: Income, Value, and Margin of Safety
  • Alibaba (9988 HK): Buy JD Logistics as the Business Model Alibaba Begins to Follow
  • HDFC – Amalgamated, We List Its Own Key Synergies, Which Appear Tremendous
  • Great Wall Motor Eyes Expansion in Vietnam Amid Southeast Asia Push
  • Siemens Energy: Profit Warning Offers Buying Opportunity
  • [Alibaba (BABA US, BUY, TP US$109) Company Update]: Racehorse Mechanism Benefits E-Commerce
  • Takara Bio (4974 JP): Corona Cliff Set to Jeopardize FY24 Financial; Formulated FY26 Management Plan
  • Bank of Chongqing – One Of Worst NIM Contraction, But With High Loan Growth
  • Nano Dimension – Record quarter for revenue
  • abrdn Private Equity Opportunities Trust – Coping well with the tough environment

Shortlist Of High Conviction Ideas: Income, Value, and Margin of Safety

By Sameer Taneja

Alibaba (9988 HK): Buy JD Logistics as the Business Model Alibaba Begins to Follow

By Ming Lu

  • Alibaba’s new chairman decides to provide logistics service to outside customers.
  • We believe Alibaba is following JD Logistics, as both companies have large retailer bases.
  • We suggest buying JD Logistics the role model instead of Alibaba the follower.

HDFC – Amalgamated, We List Its Own Key Synergies, Which Appear Tremendous

By Daniel Tabbush

  • News out this morning that HDFC Bank and HDFC merger became effective 1 July 
  • This occurred after the Boards approved the merger scheme on 30 June
  • Funding cost benefits, operating cost synergies, product cross-sale: major benefits

Great Wall Motor Eyes Expansion in Vietnam Amid Southeast Asia Push

By Caixin Global

  • Great Wall Motor Co. Ltd. (601633.SH +2.50%) said on Wednesday that it will enter the Vietnamese market in August with its Haval H6 hybrid model, while a broader plan to build an assembly plant for new-energy vehicles in the country is set for 2025.
  • The Haval H6s will initially be exported to Vietnam from its manufacturing facility in Rayong, Thailand, the Hebei-based carmaker said earlier.
  • Vietnam is the fourth-largest auto market in the Association of Southeast Asian Nations (ASEAN) region after Indonesia, Thailand and Malaysia, according to 2022 passenger car sales figures released by the ASEAN Automotive Federation.

Siemens Energy: Profit Warning Offers Buying Opportunity

By Alexis Dwek

  • Since its spin-off from Siemens Group’s former Gas and Power division three years ago, momentum for the new formed Company has been picking up
  • Siemens Energy is experiencing a rise in demand for green transition technologies as governments worldwide move away from fossil fuels.
  • Siemens Gamesa has recently announced a profit warning. We feel that the market over-reacted as the shares plunged over 37% on the day, erasing €7bn in Siemens Energy’s market value.

[Alibaba (BABA US, BUY, TP US$109) Company Update]: Racehorse Mechanism Benefits E-Commerce

By Shawn Yang

  • We recently discussed BABA’s management changes with more e-commerce practitioners, and our main conclusion is that this change will be more beneficial to BABA’s e-commerce business rather than other subsidiaries;
  • BABA is expected to learn from Tencent and ByteDance by shifting from a centralized authority model to a racehorse mechanism. Some subsidiaries, especially AliCloud and Cainiao, undergo a painful transformation;
  • This may be good news for BABA because its e-commerce  is the largest of its valuation. We also remind investors to exercise caution regarding the upcoming IPOs of BABA subsidiaries.

Takara Bio (4974 JP): Corona Cliff Set to Jeopardize FY24 Financial; Formulated FY26 Management Plan

By Tina Banerjee

  • Takara Bio Inc (4974 JP) is anticipating 32% YoY decline in revenue to ¥53B in FY24. Both operating and net profits are expected to decline more than 60% YoY in FY24.
  • The company has formulated the medium-term management plan 2026 for the three-year period ending in FY26, with the final-year quantitative targets being operating profit of ¥15 billion and ROE 8%.
  • Considering Takara Bio’s FY24 operating profit guidance of ¥8B, FY26 target seems to be aggressive and difficult to achieve.

Bank of Chongqing – One Of Worst NIM Contraction, But With High Loan Growth

By Daniel Tabbush

  • Combination of high NIM contraction with high loan growth is not a good combination
  • BOC has seen its NIM down 14% in the past year but against 12% loan growth
  • PBOC pressure to cut rates and for banks to support ailing debtors, is a risk

Nano Dimension – Record quarter for revenue

By Edison Investment Research

For Q123, Nano Dimension reported good progress in revenue, up 43.5% y o-y and 23.6% q-o-q to $15.0m. Continued investment in R&D resulted in an adjusted EBITDA loss of $23.7m. Revaluation of the company’s stake in Stratasys and interest income earned on cash resulted in net income of $22.2m for the quarter. With net cash of $974m at quarter end, the company is well-funded to pursue its acquisition strategy.

abrdn Private Equity Opportunities Trust – Coping well with the tough environment

By Edison Investment Research

abrdn Private Equity Opportunities Trust (APEO) posted a 12-month NAV total return (TR) to end-May 2023 of 7.0%, supported by continued strong portfolio earnings momentum (up 28.7% over the 12 months to end-March 2023 for APEO’s top 50 holdings). Muted global M&A volumes continue to weigh on private equity (PE) exit activity, with APEO’s capital calls in the calendar year to end-May 2023 (£74.0m) outpacing distributions (£54.1m). That said, APEO’s undrawn credit facility and cash of £243.4m at end-May 2023 provide it with decent near-term balance sheet headroom, as these cover 35% of APEO’s outstanding investment commitments (which should be drawn gradually in the coming years).

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Jul 04
0

Daily Brief Event-Driven: HSCEI Index Rebalance Preview: Deletions Fairly Certain; Uncertainty Among the Adds and more

By | Daily Briefs, Event-Driven

In today’s briefing:

  • HSCEI Index Rebalance Preview: Deletions Fairly Certain; Uncertainty Among the Adds
  • United Malt/Malteries Soufflet: I’ll Drink To That!
  • EQD | Introducing the Market Reversal Matrix (MRM): Predict Trend Reversal with Bayesian Models
  • CSI500 Index Rebalance Preview: Potential Adds Outperforming Potential Deletes
  • Musgrave Minerals (MGV AU): Ramelius’ Offer Edges past Westgold’s Offer
  • (Mostly) Asia M&A, June 2023:  DDH1, Dali Foods, NWS Holdings, JSR Corp, Lutronic, Chindata
  • Healthway Medical (HMED SP): OUE Healthcare’s Delisting Offer

HSCEI Index Rebalance Preview: Deletions Fairly Certain; Uncertainty Among the Adds

By Brian Freitas

United Malt/Malteries Soufflet: I’ll Drink To That!

By David Blennerhassett

  • Back on the 28 March, United Malt Group Ltd (UMG AU) entered into a NBIO with Malteries Soufflet at an Offer Price of $5.00/share, a 45.3% premium to undisturbed.
  • After a lengthy due diligence process, the two companies have now entered into a binding agreement of A$5.00/share, by way of a Scheme. UMG’s board has unanimously recommended the bid.
  • The Offer is subject to FIRB and other regulatory approvals. Malteries Soufflet and UMG are the second and fourth-largest maltsters in the world.

EQD | Introducing the Market Reversal Matrix (MRM): Predict Trend Reversal with Bayesian Models

By Nico Rosti

  • A market-timing device that classifies historical trend patterns/reversals in “buckets”, to generate a “matrix” showing the market’s average trend reversal “behavior” at the end of each trend “type”. 
  • A purely statistical approach: using Bayesian Models to determine the probability of DAILY or WEEKLY trend reversal at precise LONG/SHORT support prices at fixed points in time.
  • The analogy with the game of Blackjack: knowing the probability of a trend reversal can be 30% or 90% (not always =50%) can be a significant edge for the investor.

CSI500 Index Rebalance Preview: Potential Adds Outperforming Potential Deletes

By Brian Freitas

  • Two thirds of the way through the review period for the June rebalance of the CSI500 Index, we forecast 50 changes (the maximum permitted) at the close on 8 December.
  • There is a big sector skew in the potential changes. We estimate a one-way turnover of 10.1% at the December rebalance resulting in a one-way trade of CNY 6.75bn.
  • The potential adds have outperformed the potential deletes and the CSI500 Index over the last six weeks. There could be more outperformance till nearer the end of the review period.

Musgrave Minerals (MGV AU): Ramelius’ Offer Edges past Westgold’s Offer

By Arun George

  • Musgrave Minerals (MGV AU) has recommended a cash and scrip off-market takeover offer from Ramelius Resources (RMS AU) at 1 RMS share for every 4.21 MGV shares + A$0.04 cash.
  • RMS’ offer is attractive compared to adjusted exchange ratios and peer multiples. The offer, which has a 50.1% minimum acceptance condition, has secured commitments from shareholders representing 12.13% of shares.
  • At the last close, RMS’ offer is 14.9% higher than Westgold Resources (WGX AU)’s rival scrip off-market takeover offer of 1 WGX share for every 5.37 MGV shares.

(Mostly) Asia M&A, June 2023:  DDH1, Dali Foods, NWS Holdings, JSR Corp, Lutronic, Chindata

By David Blennerhassett

  • For the month of June, 13 new deals (firm and non-binding) were discussed on Smartkarma with an overall announced deal size of ~US$9bn.
  • The average premium for the new deals announced (or first discussed) in June was 42%.
  • This compares to the average premium for all deals in 2022 (106 deals), 2021 (165 deals), 2020 (158 deals), and 2019 (145 deals) of 41%, 33%, 31%, and 31% respectively.

Healthway Medical (HMED SP): OUE Healthcare’s Delisting Offer

By Arun George

  • Healthway Medical Corp (HMED SP) received a delisting proposal from OUE Lippo Healthcare (IHC SP) at S$0.048 per share, a 45.5% premium to the undisturbed price (28 June).
  • The key conditions are HMED shareholder approval and the offeror and concert parties representing >50% of voting rights (satisfied due to irrevocables).
  • The offer price is attractive. The EGM is likely to be held in late September. The current price of S$0.046 implies a gross spread of 4.3%.

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Jul 04
0

Daily Brief Macro: Global Liquidity … Still Rising? and more

By | Daily Briefs, Macro

In today’s briefing:

  • Global Liquidity … Still Rising?
  • Out of the Box #11 – Sticky Is the New Transitory – Watch Series
  • The Week That Was in ASEAN@Smartkarma – Ace Hardware Shines, Alfamart’s New Quest, and SCMA for 2H23
  • EM BY EM #11 Hangover After the Gold Rush? – Steno Signals

Global Liquidity … Still Rising?

By Michael J. Howell

  • Global Liquidity matters hugely for World financial markets. Although Fed Liquidity is slowing, there are compelling signs that liquidity is rising elsewhere
  • Foreign holdings of US dollars are expanding once again, as flow migrate towards Asia. Many policy makers are monetizing these inflows.
  • China’s PBoC  stepped up her liquidity injections, adding RMB 1 trillion to money markets through June. This should have a positive effect on the Chinese and World economies  

Out of the Box #11 – Sticky Is the New Transitory – Watch Series

By Andreas Steno

  • We take a look at the inflation in necessities and whether it is fair to assume that sticky inflation has become the new transitory.
  • The peak hours 4-5 pm were priced at -1000 DKK/MWh in West Denmark and close to -1900 EUR/MWh just south of the border in Germany.
  • These are unprecedented price levels and complete uncharted territory for electricity prices.

The Week That Was in ASEAN@Smartkarma – Ace Hardware Shines, Alfamart’s New Quest, and SCMA for 2H23

By Angus Mackintosh

EM BY EM #11 Hangover After the Gold Rush? – Steno Signals

By Emil Moller

  • Gold has managed to maintain its ground recently and remains above the $1900 level on the back of stronger-than-expected hard data on both sides of the Atlantic.
  • But markets are of course forward-looking and though recent strength has offered some momentum and the “inevitable recession” keeps getting postponed, markets are nonetheless expecting inflation to decelerate and central banks to change course in the coming months.
  • If so the historic downsizing of balance sheets will be done already (the temporary bottom was so far in during Q4-2022).

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Jul 04
0

Most Read: IREIT Global, ZJLD Group, Tokyo Stock Exchange Tokyo Price Index Topix, HDFC Bank, Shanghai United Imaging Healthcare, Perfect Medical Health, Alibaba Group Holding , BeiGene Ltd, United Malt Group Ltd, Fadu and more

By | Daily Briefs, Most Read

In today’s briefing:

  • Smartkarma Corporate Webinar | IREIT Global: Dividend Quality in a Challenging Market
  • HSCI Index Rebalance Preview and Stock Connect: The Final List for September
  • The TSE’s New ‘Better’ Index:  JPX Prime 150
  • Index Rebalance & ETF Flow Recap: KQ150, LQ45, PCOMP, HDFC/HDFCB, Delta Electronics, Redox IPO, AMFI
  • CSI300 Index Rebalance Preview: Early Look at Potential Changes in December
  • Shortlist Of High Conviction Ideas: Income, Value, and Margin of Safety
  • Alibaba (9988 HK): Buy JD Logistics as the Business Model Alibaba Begins to Follow
  • HSCEI Index Rebalance Preview: Deletions Fairly Certain; Uncertainty Among the Adds
  • United Malt/Malteries Soufflet: I’ll Drink To That!
  • Fadu IPO Preview

Smartkarma Corporate Webinar | IREIT Global: Dividend Quality in a Challenging Market

By Smartkarma Research

For our next Corporate Webinar we are glad to welcome IREIT Global’s CEO, Louis d’Estienne d’Orves.

In the upcoming webinar, Louis will share a short company presentation after which, he will engage in a fireside chat with Smartkarma Insight Provider, Jesus Rodriguez Aguilar. The Corporate Webinar will include a live Q&A session.

The Corporate Webinar will be hosted on Thursday, 6 July 2023, 17:00 SGT.

About IREIT Global

IREIT Global, which was listed on 13 August 2014, is the first Singapore-listed real estate investment trust with the investment strategy of principally investing, directly or indirectly, in a portfolio of income-producing real estate in Europe which is used primarily for office, retail and industrial (including logistics) purposes, as well as real estate-related assets. IREIT Global’s current portfolio comprises five freehold office properties in Germany, five freehold office properties in Spain and 27 freehold retail properties in France.

IREIT Global is managed by IREIT Global Group Pte. Ltd., which is jointly owned by Tikehau Capital and City Developments Limited. Tikehau Capital is global alternative asset management group listed in France, while City Developments Limited is a leading global real estate company listed in Singapore.

HSCI Index Rebalance Preview and Stock Connect: The Final List for September

By Brian Freitas

  • There could be 25 inclusions, including many new listings, to the Hang Seng Composite Index (HSCI) in September. Another 6 stocks are close adds on liquidity and market cap.
  • We see 19 potential deletes and 2 close deletes on market cap, 5 potential deletes on prolonged trading suspension, and 2 close deletes on liquidity.
  • There are 8 potential deletions where holdings via Stock Connect are more than 20% of shares outstanding. There could be some unwinding of positions over the next couple of months.

The TSE’s New ‘Better’ Index:  JPX Prime 150

By Travis Lundy

  • In April 2022, after long prep and considerable public comment as to desires and design, the TSE launched its new market segments designed to encourage governance and foreign investment.
  • At the time, the TSE wanted to showcase Japan’s best blue chips. In March, JPX announced JPX Prime 150, designed to make visible
  • In March 2023, JPX announced JPX Prime 150, to “make visible the leading Japanese companies that are estimated to create value.” Ambitious? Yes. Fated to fail? Probably. Badly constructed?  Definitely. 

Index Rebalance & ETF Flow Recap: KQ150, LQ45, PCOMP, HDFC/HDFCB, Delta Electronics, Redox IPO, AMFI

By Brian Freitas

  • The review period for a bunch of indices ended last week though the announcement of the changes will take 4-6 weeks.
  • There are no rebalance implementations in the coming week though focus will move to the implementation of the HDFC Limited/ HDFC Bank merger and index changes the following week.
  • There were big inflows to China focused ETF with a lot of money going into Semiconductor and Chip focused ETFs.

CSI300 Index Rebalance Preview: Early Look at Potential Changes in December

By Brian Freitas

  • Two thirds of the way through the review period, we see 14 potential index changes at the December rebalance that will be implemented at the close on 8 December.
  • We estimate a one-way turnover of 1.98% at the December rebalance leading to a one-way trade of CNY 5.32bn.
  • The potential adds have outperformed the potential deletes and the Shanghai Shenzhen CSI 300 Index (SHSZ300 INDEX) over the last five months, though there is some near-term underperformance.

Shortlist Of High Conviction Ideas: Income, Value, and Margin of Safety

By Sameer Taneja

Alibaba (9988 HK): Buy JD Logistics as the Business Model Alibaba Begins to Follow

By Ming Lu

  • Alibaba’s new chairman decides to provide logistics service to outside customers.
  • We believe Alibaba is following JD Logistics, as both companies have large retailer bases.
  • We suggest buying JD Logistics the role model instead of Alibaba the follower.

HSCEI Index Rebalance Preview: Deletions Fairly Certain; Uncertainty Among the Adds

By Brian Freitas

United Malt/Malteries Soufflet: I’ll Drink To That!

By David Blennerhassett

  • Back on the 28 March, United Malt Group Ltd (UMG AU) entered into a NBIO with Malteries Soufflet at an Offer Price of $5.00/share, a 45.3% premium to undisturbed.
  • After a lengthy due diligence process, the two companies have now entered into a binding agreement of A$5.00/share, by way of a Scheme. UMG’s board has unanimously recommended the bid.
  • The Offer is subject to FIRB and other regulatory approvals. Malteries Soufflet and UMG are the second and fourth-largest maltsters in the world.

Fadu IPO Preview

By Douglas Kim

  • Fadu is getting ready to complete its IPO in Korea in August. Fadu is one of the most highly anticipated IPOs in Korea in 2023. 
  • The expected market cap at the top end of the IPO price range is 1.6 trillion won. The IPO price range is from 26,000 won to 31,000 won.
  • Fadu is a system semiconductor fabless company specializing in data centers.

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Jul 03
0

Daily Brief Singapore: Bonvests Holdings, Far East Hospitality Trust, Frontline Industrial Software and more

By | Daily Briefs, Singapore

In today’s briefing:

  • Malaysia’s EPF lifts its AEM stake, crossing 10% level
  • REIT Watch – 10 S-REITs buck the trend despite REITs lagging in June
  • Cocoon Capital invests in AI-powered construction planning simulation platform Frontline

Malaysia’s EPF lifts its AEM stake, crossing 10% level

By Geoff Howie

  • Share buybacks by primary listed companies 23 – 29 Jun 2023 As at Jun 28, the three SDR collectively garnered close to S$0.2 million retail net inflows, with largest net buys in Airports of Thailand.
  • His preceding acquisitions were on Jun 6 and 5, with 17,000 shares and 6,800 shares acquired respectively, at S$0.96 per share.

REIT Watch – 10 S-REITs buck the trend despite REITs lagging in June

By Geoff Howie

  • 10 S-Reits buck the trend despite Reits lagging in June The month of June (till Jun 28, 2023) saw the iEdge S-Reit index record flattish performance at 0.3 per cent total returns for the month, improving from the 3.0 per cent declines in May.
  • The 10 best performing S-Reits for the month of June (till Jun 28, 2023) averaged over 7 per cent in total returns.

Cocoon Capital invests in AI-powered construction planning simulation platform Frontline

By e27

  • Singapore-based construction planning simulation and optimisation startup Frontline Industrial Software has raised US$700,000 in a seed funding round led by Cocoon Capital.
  • Frontline, founded by Luis Martinez and Ruiqi Ding, enables construction companies, operators and contractors to quickly identify best-in-class construction plans with optimal activity sequencing and resource allocation.
  • The software uses Artificial Intelligence to identify the most efficient and cost-effective construction plans for complex infrastructure, civil, energy, industrial and residential projects.

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Jul 03
0

Daily Brief South Korea: ST Pharm Co Ltd and more

By | Daily Briefs, South Korea

In today’s briefing:

  • KRX’s Official Selection Results of SSF & SSO Adds/Deletes: New Rules & Trading Ramifications

KRX’s Official Selection Results of SSF & SSO Adds/Deletes: New Rules & Trading Ramifications

By Sanghyun Park

  • The latest update will feature the addition of 25 single stock futures, as well as five single stock options from KOSPI. Eight single stock futures will be removed.
  • The selection will now take place twice a year, in March and September. Also, the selection requirement includes being included in the KOSPI 200 and KOSDAQ Global.
  • The shortened selection cycle and the significant potential for the change range to vary based on index review results can indeed have a notable impact.

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