Smartkarma Daily Briefs

Weekly recap of volatility and price metrics, covering option volumes, volatility trends, the spot/implied relationship, and open interest.
Nifty posts its largest weekly gain in nine months however, the rally resembles past counter-trend moves since the September 2024 peak.
We outline a tactical hedge that aligns with recent price action, volatility shifts, and heightened global political risks

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Mar 24

Daily Brief Japan: Sun Corp, TSE Tokyo Price Index TOPIX, Nikkei 225, Workman Co Ltd, JX Advanced Metals and more

By Smartkarma Daily Briefs | Daily Briefs, Japan

In today’s briefing:

Sun Corp (6736) – Still Cheap
TSE Growth Market Reforms Also Expected to Be Effective in “Request”
Nikkei Index Options Weekly (Mar 17 – 21): Muted Reaction to BOJ as Volatility Declines
Workman Fixes the Big Problem: Colors Replaces Workman Joshi
ECM Weekly (24th Mar 2025) -JX Advance, DN Solutions, Nanshan Aluminimum, Anthem, EAAA, Judo Capital

Sun Corp (6736) – Still Cheap

Eight months on from the Tender Offer which changed the shape of the shareholder register, Sun Corp (6736 JP) is as cheap to its main asset as it was before.
Sun Corp is cheap to its holding in Cellebrite DI (CLBT US). How cheap depends on the form and structure of its eventual exit.
Understanding what the options are (and the dynamics around hedging/exposure) is worthwhile.

TSE Growth Market Reforms Also Expected to Be Effective in “Request”

By Aki Matsumoto

A drastic shift by the TSE to focus on quality without increasing the number of listed companies by reducing the number of IPO companies is not very promising.
TSE will raise the hurdle for listing maintenance criteria slightly, but it will ask companies to make a commitment to post-listing growth during the listing examination process.
It’ll take time for quality of market to increase, and we expect that companies that are aware of listing costs with help from investors will naturally move to de-list themselves.

Nikkei Index Options Weekly (Mar 17 – 21): Muted Reaction to BOJ as Volatility Declines

A weekly recap of volatility and price metrics, covering option volumes, volatility trends, the spot/implied relationship, and open interest statistics.
The Bank of Japan held rates steady, with little reaction from the Nikkei or USD/JPY amid lower option volumes.
Implied volatility declined throughout the week, pressured by muted price action and low historic volatility.

Workman Fixes the Big Problem: Colors Replaces Workman Joshi

By Michael Causton

Workman’s slower same-store growth can be blamed on its shift to mass market fashion and the choice of Workman Joshi as a banner, putting off male customers.
The outdoor and workwear retailer has now acknowledged the misstep and will rebrand the chain as Workman Colors while adjusting merchandise back to more apparel basics.
This will take time to implement but could mean a return to form for the apparel retailer.

ECM Weekly (24th Mar 2025) -JX Advance, DN Solutions, Nanshan Aluminimum, Anthem, EAAA, Judo Capital

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, JX Advanced Metals (5016 JP) managed to hold on to its deal price, riding on the copper price resurgance.
On the placements front, Judo Capital (JDO AU) was the only largish deal over the past week.

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Mar 24

Daily Brief China: NetEase , Meituan, Guangzhou Automobile Group, HKBN Ltd, CK Hutchison Holdings, Shanghai Fosun Pharmaceutical (Group), China Merchants Port, PC Partner, DiDi Global, Jiangsu Zenergy Battery Technologies and more

By Smartkarma Daily Briefs | China, Daily Briefs

In today’s briefing:

Hang Seng Indexes: FAF Methodology Change for Secondary Listings; Over US$1bn to Buy in NetEase
Meituan (3690 HK): 4Q24, High Growth and Higher Margin, 60% Upside
A/H Premium Tracker (To 21 Mar 2025): AH Premia Still Falling; Expect Curve Torsion or AH Widening
Merger Arb Mondays (24 Mar) – HKBN, ESR, Canvest, Vesync, Seven & I, Proto, Makino, Spartan
Weekly Deals Digest (23 Mar) – CK Hutchison, Canvest, ENN Energy, HKBN, Fengxiang, Spartan, DN Sols
China Healthcare Weekly (Mar.23)-Fosun Pharma Sells United Family Healthcare, MNC’s Inflection Point
China Merchants Port (144 HK): Will It Have a Role in CKH’s Port Sale?
PC Partners (1263 HK): SGX Primary Listing Justified To Maintain NVIDIA Supply
Didi Global Q424 Results: Another Set of Solid Numbers from China’s Ride Hailing Giant
Jiangsu Zenergy Battery Technologies Pre- IPO – The Positives – Brisk Volume-Led Growth

Hang Seng Indexes: FAF Methodology Change for Secondary Listings; Over US$1bn to Buy in NetEase

Hang Seng Indexes has announced a change in the FreeFloat-Adjusted Factor (FAF) methodology for Secondary Listings that will be implemented from the next rebalance in June.
NetEase (9999 HK), Baidu (9888 HK), Trip.com (9961 HK), NIO (9866 HK), New Oriental Education & Techn (9901 HK) and Weibo (9898 HK) benefit; GDS Holdings (9698 HK) loses out.
The FAF changes along with capping changes will result in a round-trip trade of HK$34.2bn (US$4.4bn) at the June rebalance with the largest turnover for the Hang Seng TECH Index.

Meituan (3690 HK): 4Q24, High Growth and Higher Margin, 60% Upside

By Ming Lu

In 4Q24, Meituan’s revenue growth rate was 20% YoY with all businesses rising.
The operating margin improved to 8.8% in 4Q24 versus about zero in 4Q23.
We set an upside of 61% and a price target of HK$270. Buy.

A/H Premium Tracker (To 21 Mar 2025): AH Premia Still Falling; Expect Curve Torsion or AH Widening

AH Premia continue to fall. Spread curve torsion was a barbell this week. Narrow and wide spreads see Hs outperform. Middling spreads outperform less.
To me, warning signs are flashing on spreads. They are at their narrowest in 5yrs and they are volatile, though volatility is coming down.
Lots of spreads see the HA premium less than 15%. That is historically tight.

Merger Arb Mondays (24 Mar) – HKBN, ESR, Canvest, Vesync, Seven & I, Proto, Makino, Spartan

By Arun George

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: Seven & I Holdings (3382 JP), OneConnect Financial Technology (OCFT US), Insignia Financial (IFL AU), Smart Share Global (EM US), Soundwill Holdings (878 HK).
Lowest spreads: Makino Milling Machine Co (6135 JP), Shibaura Electronics (6957 JP), Domain Holdings Australia (DHG AU), Tonami Holdings (9070 JP), PointsBet Holdings (PBH AU).

Weekly Deals Digest (23 Mar) – CK Hutchison, Canvest, ENN Energy, HKBN, Fengxiang, Spartan, DN Sols

By Arun George

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: DN Solutions (298440 KS) seeks to raise US$1.1 billion in a KRX IPO.
Event-Driven developments: CK Hutchison Holdings (1 HK), Canvest Environmental Protection Group (1381 HK), ENN Energy (2688 HK), HKBN Ltd (1310 HK), Shandong Fengxiang (9977 HK), Spartan Resources (SPR AU).

China Healthcare Weekly (Mar.23)-Fosun Pharma Sells United Family Healthcare, MNC’s Inflection Point

By Xinyao (Criss) Wang

Given new policy recommendations, it is only a matter of time before HPV vaccination is included in the national immunization program, which is detrimental to HPV vaccine companies.
MNCs have seen a inflection point in performance growth in 2024 in China. Although VBP/NRDL negotiation are negative factors, is it also due to any consideration to withdraw from China?
Fosun Pharma has agreed to sell its entire stake in United Family Healthcare to Calcite Gem Investments Group for US$124.1 million. We shared our views about the deal.

China Merchants Port (144 HK): Will It Have a Role in CKH’s Port Sale?

By Osbert Tang, CFA

China Merchants Port (144 HK) may potentially play a role in CK Hutchison Holdings (1 HK)‘s port portfolio disposal should the mainland government want to step in.
While CMPH’s size is small relative to the port portfolio, its parent China Merchants Group and sister China Merchants Bank H (3968 HK) can easily facilitate such a transaction.
Having the portfolio in the hands of mainland company is desirable to the Chinese government. Even if CMPH has no role, its 7.6x PER and 6% yield are attractive.

PC Partners (1263 HK): SGX Primary Listing Justified To Maintain NVIDIA Supply

By David Blennerhassett

On the 18th June 2024, PC Partner (1263 HK)‘s board said it was considering an SGX listing, by way of introduction, and applying for the withdrawal of the HKEx listing.
A 30th August 2024 announcement provided clarity on a step-by-step approach for the HKEx withdrawal. A secondary listing on the SGX was established on the 15th November.
The next step is to establish a dual-primary listing in Singapore. Then withdraw the HKEx listing. The key driver behind this exercise is ensure the uninterrupted supply of NVIDIAs GPUs.

Didi Global Q424 Results: Another Set of Solid Numbers from China’s Ride Hailing Giant

By Daniel Hellberg

Most key P&L items and revenue drivers improved Y/Y and sequentially vs Q324
Although GTV per transaction dipped slightly, estimated “take rate” improved in Q424
Strong OpCF obviates need for quick FY25 IPO — but it could still happen this year

Jiangsu Zenergy Battery Technologies Pre- IPO – The Positives – Brisk Volume-Led Growth

By Akshat Shah

Jiangsu Zenergy Battery Technologies (JSZENERGY CH) (Zenergy) is looking to raise up to US$300m in its upcoming HK IPO.
Zenergy is an EV and energy storage system battery manufacturer providing integrated battery solutions, encompassing battery cells, modules, packs and battery management systems dedicated to large-scale applications of electrochemical products.
In this note, we talk about the positive aspects of the deal.

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Mar 24

Daily Brief Financials: NIFTY Index, Korea Stock Exchange KOSPI 200, Nikkei 225, Hang Seng China Enterprises Index and more

By Smartkarma Daily Briefs | Daily Briefs, Financials

In today’s briefing:

Market Movers: Key Dates at a Glance (March 24-30)
Nifty Index Options Weekly (Mar 17 – 21): A Familiar Rally Pattern—We Outline a Hedge
Kospi Index Options Weekly (Mar 17 – 21): Extending Gains and Outperformance
Nikkei Index Options Weekly (Mar 17 – 21): Muted Reaction to BOJ as Volatility Declines
Hong Kong Single Stock Options Weekly (Mar 17–21): Tencent, Xiaomi, and Financials in the Spotlight

Market Movers: Key Dates at a Glance (March 24-30)

By Gaudenz Schneider

India: Index changes for Nifty indices will take place. Multiple option expiries are scheduled, impacting stocks and indices such as the NIFTY 50 Index, and the SENSEX Index.
Asia-Pacific: Key events include Hong Kong’s earnings week and Tokyo CPI release, while Australia reports its Monthly CPI indicator.
USA: Significant releases include the final Q4 2024 GDP figures and the PCE Price Index, the Fed’s preferred inflation gauge.

Nifty Index Options Weekly (Mar 17 – 21): A Familiar Rally Pattern—We Outline a Hedge

Weekly recap of volatility and price metrics, covering option volumes, volatility trends, the spot/implied relationship, and open interest.
Nifty posts its largest weekly gain in nine months however, the rally resembles past counter-trend moves since the September 2024 peak.
We outline a tactical hedge that aligns with recent price action, volatility shifts, and heightened global political risks

Kospi Index Options Weekly (Mar 17 – 21): Extending Gains and Outperformance

A weekly recap of volatility and price metrics, including option volumes, volatility trends, the spot/implied relationship, and open interest statistics.
Kospi extended its gains after a strong start, maintaining its position as a relative outperformer.
We examine Kospi’s recent outperformance against comparable indices as well as SP500.

Nikkei Index Options Weekly (Mar 17 – 21): Muted Reaction to BOJ as Volatility Declines

A weekly recap of volatility and price metrics, covering option volumes, volatility trends, the spot/implied relationship, and open interest statistics.
The Bank of Japan held rates steady, with little reaction from the Nikkei or USD/JPY amid lower option volumes.
Implied volatility declined throughout the week, pressured by muted price action and low historic volatility.

Hong Kong Single Stock Options Weekly (Mar 17–21): Tencent, Xiaomi, and Financials in the Spotlight

Weekly recap of key option metrics across single stocks, including most active names and strikes, largest volume increases, biggest movers, and key earnings reports.
Post-Earnings performance of Tencent, Xiaomi, Anta, and China Tower analyzed.
Financials take center stage with several major earnings releases on deck this week.

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Mar 23

Daily Brief Thematic (Sector/Industry): Charted Insights: India’s Inflation Trajectory – What Lies Ahead in FY26? and more

By Smartkarma Daily Briefs | Daily Briefs, Thematic (Sector/Industry)

In today’s briefing:

Charted Insights: India’s Inflation Trajectory – What Lies Ahead in FY26?
APAC Healthcare Weekly (Mar 23)- Kissei, Alteogen, Junshi Biosciences, Celltrion, Lunit, HLB

Charted Insights: India’s Inflation Trajectory – What Lies Ahead in FY26?

By Nimish Maheshwari

Inflation is poised to trend lower in FY26 due to improving food supply conditions, a benign global commodity environment, and supportive monsoon expectations, risks from climate and geopolitical uncertainties.
Looking ahead, the continued moderation in inflation, combined with the government’s commitment to fiscal consolidation, creates a favourable backdrop for further monetary easing.
A watchful policy stance and responsive fiscal-monetary coordination will be critical to sustaining the disinflation path.

APAC Healthcare Weekly (Mar 23)- Kissei, Alteogen, Junshi Biosciences, Celltrion, Lunit, HLB

By Tina Banerjee

Kissei Pharmaceutical initiates additional Phase III clinical trial for Rovatirelin (KPS-0373) for the treatment of spinocerebellar degeneration. Shanghai Junshi Biosciences received 11th indication approval for toripalimab in China.
AstraZeneca Entered into exclusive licensing agreement worth $1.35B with Alteogen to use latter’s hyaluronidase protein, ALT-B4, to develop subcutaneous versions of its “several oncology assets.”
Celltrion Has unveiled “Value-up Program,” whereby the company is targeting 30% revenue CAGR by 2027 to reach KRW5T revenue and 7% ROE. HLB faced another rejection from FDA for rivoceranib.

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Mar 23

Daily Brief ECM: DN Solutions IPO: The Bull Case and more

By Smartkarma Daily Briefs | Daily Briefs, ECM

In today’s briefing:

DN Solutions IPO: The Bull Case

DN Solutions IPO: The Bull Case

By Arun George

DN Solutions (298440 KS), the third-largest machining centre/turning centre machine tool manufacturer, seeks to raise US$1.1 billion in a KRX IPO.
DN Automotive (007340 KS) is the largest shareholder, representing 84.8% of outstanding shares. The primary/secondary split is 43%/57%.
The bull case rests on the market share gains, high barriers to entry, healthy forward revenue indicators, a return to growth, and top-tier EBIT margin.

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Mar 23

Daily Brief Event-Driven: LY Corp (4689) Launches Beenos (3328) Tender Offer at ¥4 and more

By Smartkarma Daily Briefs | Daily Briefs, Event-Driven

In today’s briefing:

LY Corp (4689) Launches Beenos (3328) Tender Offer at ¥4,000
HK Connect SOUTHBOUND Flows (To 21 Mar 2025); Lots Of “Day Trading” And Behind the Scenes Div-Buying
Kum Yang: A Potential Delisting? [Murphy’s Law in Progress]
(Mostly) Asia-Pac M&A: Westgold/Spartan, Dropsuite, Shandong Fengxiang, Proto Corp, Shinko Electric
Last Week in Event SPACE: Hankyu Hanshin REIT, ENN Energy, Idemitsu, HKBN, Jardine Matheson

LY Corp (4689) Launches Beenos (3328) Tender Offer at ¥4,000

On Friday 21 March, LY (4689 JP) made an announcement it had received all the required approvals and would launch the Tender Offer on 24 March.
Some were upset about the price originally but unlike other deals, this one traded below terms for three months since original announcement. Three activish funds had pitched in their 30%.
This is now trading tight, and will continue to trade tight. If you own, whether you hold through early May depends on whether you are bullish or bearish the market.

HK Connect SOUTHBOUND Flows (To 21 Mar 2025); Lots Of “Day Trading” And Behind the Scenes Div-Buying

Gross SOUTHBOUND volumes dropped again somewhat but still high at HK$619bn. NET buying by SOUTHBOUND was HK$23bn which is much smaller than the last several weeks.
The flows here are still striking and net to buy. There has to be institutional buying. And I assume it is to get the earnings yield and div pickup.
Included is a summary of important China Stocks-relevant news as I saw it this week.

Kum Yang: A Potential Delisting? [Murphy’s Law in Progress]

By Douglas Kim

Murphy’s law is at progress for Kum Yang (001570 KS).
On 21 March, Kum Yang’s external auditor gave a disclaimer of opinion on the on its audit report.
Korea Exchange is becoming more serious about delisting shady companies, especially one that receives inappropriate audit opinions for two consecutive years.

(Mostly) Asia-Pac M&A: Westgold/Spartan, Dropsuite, Shandong Fengxiang, Proto Corp, Shinko Electric

By David Blennerhassett

I tally 52 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma.
Three news new deals discussed this week: the Westgold Resources (WGX AU)/Spartan Resources (SPR AU) merger, and EcoNaviSta (5585 JP)‘s Tender Offer.
Key updates/news took place on: Dropsuite Ltd (DSE AU),Shandong Fengxiang (9977 HK), Proto Corp (4298 JP), and Shinko Electric Industries (6967 JP).

Last Week in Event SPACE: Hankyu Hanshin REIT, ENN Energy, Idemitsu, HKBN, Jardine Matheson

By David Blennerhassett

Buy Hankyu Hanshin REIT, Inc. (8977 JP) on any weakness. There will be strength ahead.
With ENN Energy (2688 HK) suspended pursuant to the Takeovers Code, a third party Offer, as opposed to ENN Group, seems more likely.
Be long Idemitsu (5019 JP) vs ENEOS for the next several weeks. Light and easy drift trade based on pressure increasing and pressure ending before new news in May.

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Mar 23

Daily Brief Equity Bottom-Up: [Tencent (700 HK and more

By Smartkarma Daily Briefs | Daily Briefs, Equity Bottom-Up

In today’s briefing:

[Tencent (700 HK, BUY, TP HK$545) Target Price Change]: C4Q24 Review: Good Time to Pick up Shares
MHI (7011 JP): U.S. Presses Japan to Spend More on Defense
Samsung Electronics(005930): Shareholders’ Meeting Results
Top Glove Corp (TOPG MK): Recovery Continues, ASP Improves, Demand Outlook Stays Strong
Hong Kong Earnings in the Week Commencing March 24
Robert Half Inc: The Expanding Demand for Protiviti’s Services Is Arguably Its Biggest Growth Catalyst!
LICHF: Benign Credit Cost Led to Strong Q3FY25
Mohawk Industries: Its Expansion in Higher-End Product Mix In An Attempt To Aid Margin Expansion May Just Work Out!
Illinois Tool Works: Here’s How Its Focus On China’s Automotive & EV Markets Is Paying Off!
Boston Scientific: How WATCHMAN and FARAPULSE Expansion Is Shaping This Med-Tech Giant’s Future!

[Tencent (700 HK, BUY, TP HK$545) Target Price Change]: C4Q24 Review: Good Time to Pick up Shares

By Ying Pan

Tencent reported C4Q24 revenue, IFRS op. profit, and IFRS net income in-line, (5.3%), 6.0% vs. our est. and 2.1%, (12.6%), 5.3% vs. cons.
We shifted our game TOP PICK from Tencent to NetEase on January 16 2025, due to pipeline gaps.
We reiterate our BUY rating and raise TP to HK$545 on Tencent. We expect game pipeline to fill the gap with the launch of two blockbusters in C3Q25.

MHI (7011 JP): U.S. Presses Japan to Spend More on Defense

By Scott Foster

Japan’s top defense and aerospace contractor is being rerated to account for the limits on relying on the U.S. for defense in an alarming national security environment.
A reasonably optimistic scenario brings MHI’s P/E ratio down to 22X in FY Mar-28, by which time Japan’s defense spending is scheduled reach 2% of GDP.
The Trump administration wants Japan to spend more, but getting the budget through the national Diet is difficult enough as it is.

Samsung Electronics(005930): Shareholders’ Meeting Results

By SUSTINVEST

All proposals at Samsung Electronics’ March 19 shareholders’ meeting were approved, despite opposition recommendations from Sustinvest, a Korean proxy advisory firm.
Sustinvest had recommended voting against outside director candidate Kim Jun-sung (Agenda 2-1-1) and inside director candidate Jeon Young-hyun (Agenda 2-2-1).
The approval of all agenda items indicates strong shareholder support for Samsung’s current management direction despite some governance concerns raised by proxy advisors.

Top Glove Corp (TOPG MK): Recovery Continues, ASP Improves, Demand Outlook Stays Strong

By Tina Banerjee

Top Glove Corp (TOPG MK) achieved 70% YoY revenue growth in 1HFY25, while net profit stood at RM 58M.
Management remains bullish on the U.S. market with North America region (23% of revenue) witnessing 13% QoQ sales growth in 2QFY25.
ASP were up 3–4% across product categories. Top Glove expects the ASP to further strengthen.

Hong Kong Earnings in the Week Commencing March 24

By Gaudenz Schneider

The Hong Kong earnings season enters its final week with at least 17 Hang Seng Index companies reporting their 2024 results and announcing dividends.
The proportion of companies reporting in the coming week and the week after is significant at an index level, with notable weightings in the HSI, HSCEI, and HS TECH indices.
Opportunities to profit from price movement around earnings are manifold and include event-focused trading, statistical arbitrage, hedging, and capitalizing on changes in dividends and implied volatility.

Robert Half Inc: The Expanding Demand for Protiviti’s Services Is Arguably Its Biggest Growth Catalyst!

Robert Half International’s fourth-quarter 2024 earnings results reveal a mixed performance, reflecting both challenges and opportunities.
The company reported global enterprise revenues of $1.382 billion, marking a decline of 6% from the previous year on a reported basis.
The net income per share for the quarter was $0.53, significantly down from $0.83 a year ago.

LICHF: Benign Credit Cost Led to Strong Q3FY25

By Ankit Agrawal, CFA

LICHF reported PAT growth of 23% YoY in Q3FY25 led by benign credit cost. Credit cost was negative (-44cr) in Q3FY25 vs INR 435cr (0.2%+ of AUM) in Q3FY24.
Stage 1 assets improved to 93.25% of AUM vs 93.09% QoQ. NIM continues to be stable at around 2.7%, similar to last quarter, making the earnings predictable now.
Led by low credit cost, LICHF is on track to achieve FY25 PAT as per our estimate of INR 5400cr+. This implies LICHF is currently trading at below 6x P/E.

Mohawk Industries: Its Expansion in Higher-End Product Mix In An Attempt To Aid Margin Expansion May Just Work Out!

Mohawk Industries’ fourth-quarter results showed a mixed performance amid ongoing industry challenges.
The company reported net sales of approximately $2.6 billion, consistent with the previous year, although this included the benefit from two additional shipping days.
Positively impacting the results were sales initiatives, restructuring efforts, and productivity improvements.

Illinois Tool Works: Here’s How Its Focus On China’s Automotive & EV Markets Is Paying Off!

Illinois Tool Works Inc. (ITW) completed 2024 on a strong financial footing, achieving record results in several key performance areas.
For the fourth quarter, the company reported a modest decline in total revenues by 1.3%, but a robust operating margin increase to 26.2%, an improvement of 140 basis points, driven primarily by enterprise initiatives.
The company’s ability to expand operating income by 4% in spite of lower revenue demonstrates effective cost management and strategic execution.

Boston Scientific: How WATCHMAN and FARAPULSE Expansion Is Shaping This Med-Tech Giant’s Future!

The financial results for Boston Scientific’s fourth quarter and full-year 2024 highlight both strengths and challenges faced by the company.
Achieving robust growth in several segments, the company reported operational sales growth of 23% for the quarter and 18.5% for the year, with organic growth hitting 20% and 16% respectively.
These figures surpass their upper guidance limits, indicating strong market performance, driven primarily by the early U.S. adoption of the FARAPULSE system and other key products.

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Mar 23

Daily Brief Macro: Overview#20 – Welcome to Bizzaro World! and more

By Smartkarma Daily Briefs | Daily Briefs, Macro

In today’s briefing:

Overview#20 – Welcome to Bizzaro World!

Overview#20 – Welcome to Bizzaro World!

By Rikki Malik

A review of recent events/data impacting our investment themes or outlook
The investment world has turned upside down where established norms have gone into reverse.
The new investing environment needs to be paid attention to.

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Mar 23

Most Read: Korea Stock Exchange KOSPI 200, SAIC Motor, Maynilad Water Services, DN Solutions, Nikkei 225, Hankyu Hanshin REIT, Inc., Binex Co Ltd, Korea Stock Exchange Kospi Index, Beenos Inc, China Mobile and more

By Smartkarma Daily Briefs | Daily Briefs, Most Read

In today’s briefing:

Korea: Short Selling Is Back in March; Trade Ideas
SSE50 Index Rebalance Preview: Three Changes; Some Misses
Maynilad Water (MYNLD PM): Index Inclusion Timing for a Large Philippines IPO
DN Solutions IPO: Index Inclusion Timing Depends on Lock-Up Expiry Schedule
Nikkei 225 Outlook After the Mar25 Rebalance
Hankyu Hanshin REIT (8977) – Good Fundamental News, a Bigly Buyback, and Cascading Flows to Come
KOSDAQ150 Index Adhoc Rebalance: Binex (053030 KS) To Replace HLB Life Science (067630 KS)
Korea’s FSC Just Dropped the Final Playbook on the Full Restart of Short Selling.
LY Corp (4689) Launches Beenos (3328) Tender Offer at ¥4,000
HK Connect SOUTHBOUND Flows (To 21 Mar 2025); Lots Of “Day Trading” And Behind the Scenes Div-Buying

Korea: Short Selling Is Back in March; Trade Ideas

Since short selling was banned in November 2023, short interest has plunged in Korea as shorts were covered. Markets have not done much over the last 16 months though.
Foreign investor holdings have dropped from 32.05% in July to 28.57%. The top 25 stocks bought by foreign investors outperformed the top 25 stocks sold by 128% in 16 months.
There will be trade opportunities across indices, pref/ords, index migrations and deletions, potential market upgrades and overvalued stocks being sold.

SSE50 Index Rebalance Preview: Three Changes; Some Misses

With nearly 90% of the review period complete, 2 non-constituents are in inclusion zone and 3 constituents are in deletion zone.
We estimate one-way turnover of 4.7% at the June rebalance leading to a round-trip trade of CNY 16.4bn (US$2.27bn). Index arb balances will increase the impact on the stocks.
The forecast adds have outperformed the forecast deletes over the last 6 months but there has been a retracement in returns over the last month.

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.

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.

Nikkei 225 Outlook After the Mar25 Rebalance

By Nico Rosti

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.

Hankyu Hanshin REIT (8977) – Good Fundamental News, a Bigly Buyback, and Cascading Flows to Come

3D Investment Partners launched a Partial Tender Offer to buy a 10+% stake in Hankyu Hanshin REIT, Inc. (8977 JP). The REIT finally responded with a “Neutral” stance.
But they also upgraded earnings forecasts, bought a building, and announced the Sponsor would buy units in the market over the next year. It’s big.
And that creates flows, which then engender other reactive flows, and cascading flows, and because the sector isn’t rich, there may be a tailwind.

KOSDAQ150 Index Adhoc Rebalance: Binex (053030 KS) To Replace HLB Life Science (067630 KS)

HLB Life Science (067630 KS) was added to the Investment Attention Issue list on 21 March and traded limit down. Then came the announcement of the KOSDAQ 150 Index deletion.
As the highest ranked non-constituent from the Healthcare sector at the December rebalance, Binex (053030 KS) will be added to the KOSDAQ 150 Index at the close on 25 March.
Historically, intra-review inclusions have moved higher between announcement and implementation and there has been reversion post the index inclusion.

Korea’s FSC Just Dropped the Final Playbook on the Full Restart of Short Selling.

By Sanghyun Park

Today’s update clarifies which brokers are fully linked to NSDS, giving them an edge in short-selling speed and flexibility, while others face more execution constraints.
This leads to a clear execution risk gap, requiring traders to factor in trade efficiency differences based on their broker.
With lower short-selling restriction triggers, liquidity and short-covering dynamics will shift, requiring traders to reassess market impact and adjust strategies accordingly.

LY Corp (4689) Launches Beenos (3328) Tender Offer at ¥4,000

On Friday 21 March, LY (4689 JP) made an announcement it had received all the required approvals and would launch the Tender Offer on 24 March.
Some were upset about the price originally but unlike other deals, this one traded below terms for three months since original announcement. Three activish funds had pitched in their 30%.
This is now trading tight, and will continue to trade tight. If you own, whether you hold through early May depends on whether you are bullish or bearish the market.

HK Connect SOUTHBOUND Flows (To 21 Mar 2025); Lots Of “Day Trading” And Behind the Scenes Div-Buying