Smartkarma Daily Briefs

Horizon Robotics (9660 HK) will be added to Southbound Stock Connect from the start of trading today. Then there will be passive buying at the close on 20 June.
The lock up expiry in April will result in large buying from trackers of the Hang Seng TECH Index (HSTECH INDEX) and HSIII Index in September.
The stock will also be added to another large global index, though the timing on inclusion is not certain at the moment.

Tsuruha (3391 JP)/Welcia (3141 JP): Vote Musings

Leading proxies recommend that Tsuruha Holdings (3391 JP) shareholders vote against the Tsuruha/Welcia Holdings (3141 JP) merger on 26 May.
The share exchange terms favour Welcia over Tsuruha shareholders. The Tsuruha vote will be close but likely to be approved. Long Tsuruha is the trade, irrespective of the vote.
For a vote pass, you are long synergies and a likely partial offer bump. For a fail, you are long an undemanding multiple and the optionality of a new bid.

Weekly Deals Digest (25 May) – Toyota Industries, Shibaura, ESR, Soundwill, Mayne Pharma, GMO

A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
ECM developments: GMO Internet (4784 JP) secondary offering of 91.7 million shares, worth around US$1.9 billion.
Event-Driven developments: Toyota Industries (6201 JP), Shibaura Electronics (6957 JP), ESR Group (1821 HK), Soundwill Holdings (878 HK), Mayne Pharma (MYX AU), Gold Road Resources (GOR AU).

Merger Arb Mondays (26 May) – Mayne, Seven & I, Shibaura, Welcia/Tsuruha, Nissin, ESR, Dickson

We summarise the latest spreads and newsflow of merger arb situations we cover across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Philippines, Thailand and Chinese ADRs.
Highest spreads: Mayne Pharma (MYX AU), Insignia Financial (IFL AU), ENN Energy (2688 HK), Seven & I Holdings (3382 JP), Smartpay Holdings (SPY NZ), ZEEKR (ZK US).
Lowest spreads: Bright Smart Securities And (1428 HK), Dada Nexus (DADA US), Amara Holdings (AMA SP), Nissin Corp (9066 JP), Avjennings Ltd (AVJ AU), SLB Development (SLB SP).

Zomato/Eternal: The BIG Passive Selling Starts

Following shareholder approval of the proposal to reduce the Foreign Ownership Limit from 100% to 49.5%, NSDL has updated the FOL. This starts the process of passive selling in Zomato.
Passives will sell US$350m at the close on Tuesday. There is a low probability of more selling later in the week. There will be bigger selling in August.
The size of the selling in August and beyond will depend on what foreign investors do in the stock till the end of June. Watch the red flag/ breach list.

Clarifying a Few Points of Confusion Surrounding the Samsung Biologics Spin-Off

By Sanghyun Park

Will the newly listed spinco also IPO Samsung Bioepis? That’s a textbook ECO — and could spark shareholder value dilution concerns, regulatory pushback, or even a potential KRX block.
The 8% dip looks tied to IPO fears around Bioepis. If Samsung hard-locks its no-IPO stance and FSS signs off, a near-term bounce in Biologics could be in play.
Post-Listing, watch for Samsung C&T to shift exposure—potentially boosting the surviving company’s value while capping the spinco. Sets up a compelling relative-value trade worth positioning for.

Underwriting Returns: A Risk Arb Look at Helvetia-Baloise

By Jesus Rodriguez Aguilar

Shareholders of both firms have approved the merger, clearing a critical milestone ahead of expected regulatory clearance by late Q3 2025.
CHF 400m in net synergies and potential capital optimization could lift 2028 ROE to nearly 16%, offering meaningful value creation.
I recommend a long Baloise / short Helvetia strategy to capture the current 1.2% spread, translating to an estimated 3.4% annualized return.

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May 26

Daily Brief Utilities: Guangdong Investment and more

By Smartkarma Daily Briefs | Daily Briefs, Utilities Sector

In today’s briefing:

Guangdong Investment (270): Stable Diversifier and USD 1.3 Bn FCF

Guangdong Investment (270): Stable Diversifier and USD 1.3 Bn FCF

By Henry Soediarko

Guangdong Investment (270 HK) exposure in water distribution provides the much-needed stability (low volatility). While its Real Estate exposure could provide some growth.
With low valuation and healthy dividend yield, owning GDI during the tumultuous period will provide healthy diversification for your portfolio and a hedge during Trump’ tariff period.
The water sector is undervalued, mainly due to the characteristically low growth, but free cash flow is generally quite strong yet undervalued. GDI generated USD 1.3 bn Free cash flow.

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May 26

Daily Brief ECM: Curator’s Cut: Korea’s Value and more

By Smartkarma Daily Briefs | Daily Briefs, ECM

In today’s briefing:

Curator’s Cut: Korea’s Value, CATL’s Charge and Copper’s Surge
ECM Weekly (26 May 2025) – CATL, Hengrui, Eastroc, Haitian, Schloss, Aegis, Hyundai Marine, Pony
Pre-IPO Foshan Haitian Flavouring & Food Company (PHIP Updates) – Some Points Worth the Attention
Aegis Vopak Pre-IPO: Expensive Related to Peers

Curator’s Cut: Korea’s Value, CATL’s Charge and Copper’s Surge

By Pranav Rao

Welcome to Curator’s Cut, a fortnightly roundup of standout themes from the 1,200+ insights published over the past two weeks on Smartkarma
In this cut, we look at Korea’s compelling valuation versus AxJ equities, CATL’s blockbuster Hong Kong listing and its market implications, and explore copper’s price surge amidst Chinese demand
Want to dig deeper? Comment or message with the themes you think should be highlighted next

ECM Weekly (26 May 2025) – CATL, Hengrui, Eastroc, Haitian, Schloss, Aegis, Hyundai Marine, Pony

By Sumeet Singh

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, Contemporary Amperex Technology (CATL) (300750 CH) and Jiangsu Hengrui Pharmaceuticals (1276 HK) performance has paved the way for a slew of A/H listings to follow.
On the placements front, there was a large selldown in HD Hyundai Marine Solution (443060 KS) and a lockup release for Pony AI (PONY US) is coming up.

Pre-IPO Foshan Haitian Flavouring & Food Company (PHIP Updates) – Some Points Worth the Attention

By Xinyao (Criss) Wang

Despite returning to positive growth, Haitian still failed to achieve its 2024 revenue target, mainly due to underperformance of Soy sauce products, consumption downgrades, slow online layout/distributors recovery.
Haitian would face dual challenges of “cost increase + structural transformation” in the next three years due to inflation and the negative impact of “new standard”. We shared our performance forecast.
High valuation is unsustainable if based on current growth rate.Reasonable valuation is about 20-30x P/E. However, due to the strong sentiment for AH listing, share price may still perform well.

Aegis Vopak Pre-IPO: Expensive Related to Peers

By Nicholas Tan

Aegis Vopak Terminals Ltd (1902844D IN) is looking to raise about US$328m in its upcoming India IPO.
It is the largest Indian third-party owner and operator (in terms of storage capacity) of tank storage terminals for liquified petroleum gas (LPG) and liquid products.
In this note, we look at the firm’s recent financial performance updates, as well as its potential valuation.

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May 26

Daily Brief Quantitative Analysis: A-H Premium Weekly (May 23rd): CATL and Hengrui Listing Lowered Premium and more

By Smartkarma Daily Briefs | Daily Briefs, Quantitative Analysis

In today’s briefing:

A-H Premium Weekly (May 23rd): CATL and Hengrui Listing Lowered Premium
HK Short Interest Weekly: AIA, Sinopec, Bilibili, Jd, HSBC
Bursa Short Interest Weekly (May 23rd): Petronas Chemicals, Top Glove, Genting Malaysia, Gamuda
TWSE Foreign Holding Weekly (May 23rd): Bizlink, TSMC, Ctbc Financial, Yang Ming Marine, Wistron
KRX Foreign Holding Weekly (May 23rd): Hyosung Heavy, SK Hynix, Samsung Electronics
HK Connect Flows Weekly (May 23rd): CCB, China Mobile, Meituan, BOC, CMB, Tencent, Xiaomi
Thailand Short Interest Weekly (May 23rd): Advanced Info Service, Minor International
TWSE Short Interest Weekly (May 23rd): Cathay Financial, Gigabyte Technology, Nanya Technology

A-H Premium Weekly (May 23rd): CATL and Hengrui Listing Lowered Premium

We analyse the changes of A-H premium on 149 stocks over the last week. The average A-H premium was 81.5% as of May 23rd.
The average A-H premium changed by -2.2ppt week-on-week, led by health care, consumer discretionary, industrials and offset by consumer staples, real estate, utilities.
We highlight weekly changes in A-H premium for Asymchem Lab, Shanghai Junshi Biosciences, Remegen, Fuyao Glass, Jiangxi Copper.

HK Short Interest Weekly: AIA, Sinopec, Bilibili, Jd, HSBC

We analyzed the latest HK SFC report for aggregate short position as of May 16th.
Top short increases and decreases were tabulated for one week and four week period.
We highlight short changes in AIA, Sinopec, Bilibili, Jd, HSBC.

Bursa Short Interest Weekly (May 23rd): Petronas Chemicals, Top Glove, Genting Malaysia, Gamuda

We analyzed the changes in short interest of Bursa stocks as of May 23rd. The aggregated short interest is USD344m.
We tabulate league tables for top short by value and short as multiple of ADT, as well as weekly increases & decreases in short value, short as multiple of ADT.
We highlight short interest changes in Petronas Chemicals, Top Glove, Genting Malaysia, Gamuda, Tenaga Nasional.

TWSE Foreign Holding Weekly (May 23rd): Bizlink, TSMC, Ctbc Financial, Yang Ming Marine, Wistron

We analyzed the changes in foreign holdings of TWSE Stocks as of May 23rd. The aggregated holding was USD1,015.2bn.
We estimate that foreign flows to be inflows of USD826mln. We tabulate the league tables for top changes by value for 1W/4W/1Y and top stocks held by foreign institutions.
We highlight changes of foreign holdings in Bizlink, TSMC, Ctbc Financial, Yang Ming Marine, Wistron, Mediatek.

KRX Foreign Holding Weekly (May 23rd): Hyosung Heavy, SK Hynix, Samsung Electronics

We analyzed the changes in foreign holdings of KRX stocks as of May 23rd. The aggregated holding was USD519.5bn.
We estimate that foreign flows to be outflows of USD210mln. We tabulates the league table for top changes by value for 1W/4W/1Y and top stocks held by foreign institutions.
We highlight changes of foreign holdings in Hyosung Heavy, SK Hynix, Samsung Electronics.

HK Connect Flows Weekly (May 23rd): CCB, China Mobile, Meituan, BOC, CMB, Tencent, Xiaomi

We analyze the weekly Hong Kong Connect flows with our data engine for holding position as of May 23rd.
The top stocks by inflows and outflows were tabulated for all market, HSCEI, mid cap and s/mid cap groups.
We highlight flows for CCB, China Mobile, Meituan, BOC, CMB, Tencent, Xiaomi.

Thailand Short Interest Weekly (May 23rd): Advanced Info Service, Minor International

We analyzed the changes in short interest of Stock Exchange of Thailand as of May 23rd. We estimate that they had an aggregated short interest worth USD2.2bn.
We tabulate league tables for top short by value and short as multiple of ADT, as well as weekly increases & decreases in short value, short as multiple of ADT.
We highlight short interest changes in Advanced Info Service, Minor International, Central Pattana, Gulf Energy Development, True, Osotspa.

TWSE Short Interest Weekly (May 23rd): Cathay Financial, Gigabyte Technology, Nanya Technology

We analyzed the changes in short interest of TWSE Stocks as of May 23rd. The aggregated short interest was USD22.5bn.
We tabulate league tables for top short by value and short as multiple of ADT, as well as weekly increases & decreases in short value, short as multiple of ADT.
We highlight short interest changes in Cathay Financial, Gigabyte Technology, Nanya Technology, Tatung.

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May 26

Daily Brief Thailand: Fabrinet and more

By Smartkarma Daily Briefs | Daily Briefs, Thailand

In today’s briefing:

Fabrinet – Fabrinet: The Rise of 1.6T Datacom Products & 4 Solid Growth Catalysts!

Fabrinet – Fabrinet: The Rise of 1.6T Datacom Products & 4 Solid Growth Catalysts!

By Baptista Research

Fabrinet has reported strong results for the third quarter of fiscal year 2025, which ended on March 28, 2025.
The company achieved a revenue of $872 million, surpassing its guidance range, and non-GAAP earnings per share stood at $2.52, also above expectations.
This performance highlights Fabrinet’s robust execution capabilities, especially in the optical communications sector where telecom revenue demonstrated significant growth, counterbalancing a predicted decline in datacom revenue.

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May 26

Daily Brief Consumer: Tsuruha Holdings, Toyota Industries, Eternal, Tongcheng Travel Holdings , Alibaba Group Holding , Foshan Haitian Flavouring & Food Company, Jade Group and more

By Smartkarma Daily Briefs | Consumer, Daily Briefs

In today’s briefing:

Tsuruha (3391 JP)/Welcia (3141 JP): Vote Musings
Weekly Deals Digest (25 May) – Toyota Industries, Shibaura, ESR, Soundwill, Mayne Pharma, GMO
Zomato/Eternal: The BIG Passive Selling Starts
Tongcheng Travel (780 HK): Regaining Momentum, Better Choice than Trip.com
Alibaba (9988 HK): Navigating Post-Earnings Volatility
Alibaba (9988 HK): Unpacking the Week’s Savvy Top Options Trades
Pre-IPO Foshan Haitian Flavouring & Food Company (PHIP Updates) – Some Points Worth the Attention
Jade Group: Magaseek and Locondo Stall

Tsuruha (3391 JP)/Welcia (3141 JP): Vote Musings

Leading proxies recommend that Tsuruha Holdings (3391 JP) shareholders vote against the Tsuruha/Welcia Holdings (3141 JP) merger on 26 May.
The share exchange terms favour Welcia over Tsuruha shareholders. The Tsuruha vote will be close but likely to be approved. Long Tsuruha is the trade, irrespective of the vote.
For a vote pass, you are long synergies and a likely partial offer bump. For a fail, you are long an undemanding multiple and the optionality of a new bid.

Weekly Deals Digest (25 May) – Toyota Industries, Shibaura, ESR, Soundwill, Mayne Pharma, GMO

A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
ECM developments: GMO Internet (4784 JP) secondary offering of 91.7 million shares, worth around US$1.9 billion.
Event-Driven developments: Toyota Industries (6201 JP), Shibaura Electronics (6957 JP), ESR Group (1821 HK), Soundwill Holdings (878 HK), Mayne Pharma (MYX AU), Gold Road Resources (GOR AU).

Zomato/Eternal: The BIG Passive Selling Starts

Following shareholder approval of the proposal to reduce the Foreign Ownership Limit from 100% to 49.5%, NSDL has updated the FOL. This starts the process of passive selling in Zomato.
Passives will sell US$350m at the close on Tuesday. There is a low probability of more selling later in the week. There will be bigger selling in August.
The size of the selling in August and beyond will depend on what foreign investors do in the stock till the end of June. Watch the red flag/ breach list.

Tongcheng Travel (780 HK): Regaining Momentum, Better Choice than Trip.com

By Osbert Tang, CFA

Tongcheng Travel Holdings (780 HK)‘s 1Q25 adjusted net profit surged 41.1%, suggesting an accelerating momentum. It should continue to outperform Trip.com Group (9961 HK).
Good cost management, even as revenue rose 13.2%, has enhanced adjusted EBITDA margin by 5.3pp YoY – this trend will sustain.
More visa convenience will boost inbound and outbound travel. At end-1Q25, net cash equals 14% of market capitalisation, and it can still generate ROE of 12-15%.

Alibaba (9988 HK): Navigating Post-Earnings Volatility

By Gaudenz Schneider

Implied Volatility Trends:Alibaba Group Holding’s (9988 HK) one-month implied volatility has significantly receded to the 37th percentile after its 15 May earnings, reflecting a substantial implied vola crush.
Skew and Term Structure Dynamics: The implied volatility term structure is now slightly upward-sloping with longer-dated options commanding a small premium. Skew dynamics indicate cheaper puts.
Open Interest Distribution: Liquidity is greatest in the June and September expiries. Short term strikes are concentrated near or at the money.

Alibaba (9988 HK): Unpacking the Week’s Savvy Top Options Trades

By Gaudenz Schneider

Over the past five trading days, Alibaba Group Holding (9988 HK) multi-leg option strategies showcased a variety of approaches. Strategy highlights are provided.
Popular Strategies: Over 35% of all strategies are Calendar or Diagonal Spreads. Bullish and bearish views prevail at equal rates, with very few market-neutral views expressed.
Top Trades: Some market participants were betting on a short term re-bound after the post-earnings drop. Others take a bearish view with finely calibrated medium-term hedges. Trade-examples are presented.

Pre-IPO Foshan Haitian Flavouring & Food Company (PHIP Updates) – Some Points Worth the Attention

By Xinyao (Criss) Wang

Despite returning to positive growth, Haitian still failed to achieve its 2024 revenue target, mainly due to underperformance of Soy sauce products, consumption downgrades, slow online layout/distributors recovery.
Haitian would face dual challenges of “cost increase + structural transformation” in the next three years due to inflation and the negative impact of “new standard”. We shared our performance forecast.
High valuation is unsustainable if based on current growth rate.Reasonable valuation is about 20-30x P/E. However, due to the strong sentiment for AH listing, share price may still perform well.

Jade Group: Magaseek and Locondo Stall

By Michael Causton

Jade Group (3558 JP) made some wild promises about its potential to grow its online fashion mall business last year when it acquired Magaseek.
But recent results suggest what many feared: building scale without due regard for the quality of the assets acquired does not an empire make.
With Magaseek contracting and e-commerce overall showing muted growth, Jade Group´s capacity to escape the shadow of the big three looks limited.

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May 26

Daily Brief TMT/Internet: Horizon Robotics, Contemporary Amperex Technology (CATL), Elite Material, Bestechnic Shanghai , Fabrinet and more

By Smartkarma Daily Briefs | Daily Briefs, TMT/Internet

In today’s briefing:

Horizon Robotics (9660 HK): Southbound Stock Connect Inclusion Today & Upcoming Index Flows
Curator’s Cut: Korea’s Value, CATL’s Charge and Copper’s Surge
Taiwan Top 50 ETF Rebalance Preview: Elite Material (2383 TT) Walking a Fine Line
STAR Chip/ CES Chips/ CNI Chips Index Rebalance Preview: Multiple Stocks with Overlapping Flow
Fabrinet – Fabrinet: The Rise of 1.6T Datacom Products & 4 Solid Growth Catalysts!
ECM Weekly (26 May 2025) – CATL, Hengrui, Eastroc, Haitian, Schloss, Aegis, Hyundai Marine, Pony

Horizon Robotics (9660 HK): Southbound Stock Connect Inclusion Today & Upcoming Index Flows

Horizon Robotics (9660 HK) will be added to Southbound Stock Connect from the start of trading today. Then there will be passive buying at the close on 20 June.
The lock up expiry in April will result in large buying from trackers of the Hang Seng TECH Index (HSTECH INDEX) and HSIII Index in September.
The stock will also be added to another large global index, though the timing on inclusion is not certain at the moment.

Curator’s Cut: Korea’s Value, CATL’s Charge and Copper’s Surge

By Pranav Rao

Welcome to Curator’s Cut, a fortnightly roundup of standout themes from the 1,200+ insights published over the past two weeks on Smartkarma
In this cut, we look at Korea’s compelling valuation versus AxJ equities, CATL’s blockbuster Hong Kong listing and its market implications, and explore copper’s price surge amidst Chinese demand
Want to dig deeper? Comment or message with the themes you think should be highlighted next

Taiwan Top 50 ETF Rebalance Preview: Elite Material (2383 TT) Walking a Fine Line

Elite Material (2383 TT)‘s stock price has soared recently and is forecast to be added to the Yuanta/P-Shares Taiwan Top 50 ETF in June, replacing Unimicron Technology (3037 TT).
Passive trackers will have 1 day of ADV to buy in Elite Material (2383 TT) and over 1 day of ADV to sell in Unimicron Technology (3037 TT).
However, Elite Material is at risk of deletion from another ETF where the impact of passive selling is a lot bigger. Tricky interplay between the two ETFs.

STAR Chip/ CES Chips/ CNI Chips Index Rebalance Preview: Multiple Stocks with Overlapping Flow