In today’s briefing:
- Nikkei 225 Index Rebalance Sep25: Performance of Potential Adds/Deletes & Positioning
- Smart Share Global (EM US): Hillhouse Emerges with a Competing Offer
- ECM Weekly (18 August 2025)- Eve Energy, CNGR, Will Semi, 52 Toys, JSW, Bluestone, Tuas, Hexaware
- How Effective Will the Changes in Listing Criteria Be, Amid a Long Grace Period and Secured Listing?
Nikkei 225 Index Rebalance Sep25: Performance of Potential Adds/Deletes & Positioning
- The changes to the Nikkei 225 (NKY INDEX) as part of the September rebalance should be announced in just over 2 weeks. We expect 2 changes at the review.
- BayCurrent Consulting‘s PAF will double, Fast Retailing‘s CPAF will stay the same, and Sony Financial Group will be deleted from the index following its spinoff from Sony Corp (6758 JP).
- Sanrio (8136 JP)‘s improved liquidity increases the probability of index inclusion, and the stock could be added to the index at the next rebalance if it misses in September.
Smart Share Global (EM US): Hillhouse Emerges with a Competing Offer
- Smart Share Global (EM US) has disclosed a competing non-binding offer from Hillhouse at US$1.77 per ADS, a 41.6% premium to the Trustar offer.
- The Hillhouse proposal meets the criteria for a superior proposal. The support agreement enables management rollover shareholders to switch allegiance from Trustar to Hillhouse.
- Unlike the Trustar offer, the Hillhouse offer is above the last reported net cash (US$1.62 per ADS). The high premium suggests a low probability that Trustar bumps.
ECM Weekly (18 August 2025)- Eve Energy, CNGR, Will Semi, 52 Toys, JSW, Bluestone, Tuas, Hexaware
- 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, a number of companies are lining up to start 2H listing season, which is likely to be one of the busiest over the past few years.
- On the placements front as well, given ongoing earnings annoucement there were only one large placement last week.
How Effective Will the Changes in Listing Criteria Be, Amid a Long Grace Period and Secured Listing?
- Companies with market capitalization of under 10 billion yen will be given long grace period. Considering inflation and long grace period, this seems not such a difficult hurdle to overcome.
- If it becomes easy to meet the new standards, the growth market may not change much from the current situation, where many companies with limited growth potential remain.
- Even though there’re measures to enable companies to move to standard market if things don’t work out, it’s questionable how many companies will seriously pursue measures to increase market capitalization.
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