In today’s briefing:
- Skyworth Group (751 HK)’s Latest Partial Buyback. Thoughts On Proration
- Northern Star’s Acquisition of De Grey Mining: The Many Index Implications & Flows
- BYD (1211 HK) Tactical Outlook: Buy-The-Dip Scenarios With Passive Buying from HSI/HSCEI Trackers
- Dada Nexus (DADA US): JD.com’s Binding Offer a Done Deal
- Complete Breakdown of the HLB Merger Swap Details
- Hindware Home Innovation Ltd: Will Restructuring Change the Company’s Fortunes?
- Event Driven: ITC Acquiring Aditya Birla Group’s Paper Business
- Lucror Analytics – Morning Views Asia
- Oisix ra daichi (3182 JP): Q3 FY03/25 flash update
- -50% Orange Juice Price Implosion
Skyworth Group (751 HK)’s Latest Partial Buyback. Thoughts On Proration
- Back on the 23 December 2022, Skyworth Group (751 HK) announced (another) partial buyback, at HK$3.80/share, a 20.25% premium to undisturbed. On the 28 March, terms were bumped to $5.00/share.
- At the close of the Offer, the Wong Concert Group held 50.35%, and were no longer subject to the creeper rule. The Group now holds 56.04%
- Yet another Partial Offer has been announced (HK$3.11/share, a 15.19% premium)), which will lift the Group’s stake to 66.45%. Minimum pro-ration is 37.84%. It is likely to go higher.
Northern Star’s Acquisition of De Grey Mining: The Many Index Implications & Flows
- Northern Star Resources (NST AU)‘s acquisition of De Grey Mining (DEG AU) is expected to complete in the next 3 weeks.
- There will be an ad hoc inclusion to the S&P/ASX 200 (AS51 INDEX) and passive buying in Northern Star Resources (NST AU) from a bunch of trackers of different indices.
- The acquisition brings Northern Star Resources (NST AU) close to inclusion in the S&P/ASX 20 Index, but it’s not there yet.
BYD (1211 HK) Tactical Outlook: Buy-The-Dip Scenarios With Passive Buying from HSI/HSCEI Trackers
- A recent insight by Brian Freitas signals that BYD (1211 HK)buying from global index trackers is done (more passive buying from HSI/HSCEI trackers may come later this month).
- As of Tuesday, the stock is currently in the middle of a modest pullback, 1 week down, reached a support area where the probability of a bounce is around 50%.
- We are at the start of the month, it may be early to benefit from the passive buying discussed by Brian Freitas, however this pullback could support a buy-the-dips strategy.
Dada Nexus (DADA US): JD.com’s Binding Offer a Done Deal
- Dada Nexus (DADA US) disclosed a binding proposal from JD.com Inc (ADR) (JD US) at US$2.00 per ADS, a 41.8% premium to the undisturbed price of US$1.41 (24 January).
- The shareholder vote is low-risk (two-thirds voting threshold), as JD.com represents 63.2% of voting power. The dissenting condition (less than 12% of outstanding shares) is waivable.
- Although the offer is unattractive, this is a done deal. The transaction is expected to close within the third quarter of 2025.
Complete Breakdown of the HLB Merger Swap Details
- Appraisal rights are for HLB Life Science holders only. Record date: April 16. Objection: May 28–June 11. Exercise: June 12–July 2. Spread’s fat—over 11% today.
- Swap spread closed at 2.3%. With short selling back, execution looks clean. Classic arb: short HLB Inc, long HLB Life Science, cover with new HLB Inc shares post-merger.
- HLB has a cult-like retail base that follows management blindly. Despite headline cancellation risk, real odds may be lower, meaning the swap spread could be seriously mispriced—prime arb setup.
Hindware Home Innovation Ltd: Will Restructuring Change the Company’s Fortunes?
- Hindware Home Innovation (HINDWARE IN) plans to demerge its consumer appliances division into a separate listed entity.
- Demerger removes loss-making drag, improving profitability and segment-specific valuation clarity.
- Unlocks hidden value; better execution with new CEO with clear growth trajectory may lead further value creation for shareholders.
Event Driven: ITC Acquiring Aditya Birla Group’s Paper Business
- ITC Ltd (ITC IN) recently announced the strategic acquisition of Century Pulp and Paper (CPP) from AB Real Estate (ABREL) for INR 3,500 crore on a slump sale basis.
- This Business Transfer Agreement (BTA) occurs amid an industry downturn marked by surging input costs, subdued demand, and competition from low-priced imports.
- This acquisition significantly expands ITC’s paper segment capacity by 60%, targeting a 30-40% EBITDA per tonne improvement.
Lucror Analytics – Morning Views Asia
- In the US, New York Fed President John Williams said tariffs could produce “more prolonged effects” on inflation, as indirect effects from the new duties “might not be fully felt for a couple of years”.
- Mr Williams added that “there’s a lot of uncertainty about how the economy will evolve and a lot of uncertainty about all the policy actions”, and hence expects the US central bank to keep interest rates unchanged for “some time”.
- Treasuries gained for a second day yesterday on continued safe-haven flows, ahead of US President Donald Trump’s expected announcement of reciprocal tariffs tomorrow.
Oisix ra daichi (3182 JP): Q3 FY03/25 flash update
- In January 2024, SHiDAX Corporation was consolidated as a subsidiary, boosting sales and EBITDA in Q4 FY03/24.
- Cumulative Q3 FY03/25 progress rates: 75.9% sales, 93.7% EBITDA, 84.4% operating profit, 110.5% net income.
- B2C Subscription sales decreased YoY, but segment profit increased due to higher ARPU and cost-efficient acquisitions.
-50% Orange Juice Price Implosion
- -50% Orange Juice Price Implosion After a crazy price surge – orange juice futures traded at the ICE have more than halved since the start of the year.
- While reaching its temporary high of 539 USX in December, the forward contract is now trading at 247 USX.
- The price is now back at levels it was trading at the beginning of 2024. Compared to 2020 futures pricing is still up 150%. (yeah you read that right)
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