In today’s briefing:
- Errors in Local Street’s Projections for the KOSPI 200 Rebalancing
- Nihon Parkerizing (4095) – 3mos Left on Big Buyback
- KOSPI200 Index Rebalance Preview: 7 Changes a Side for June
- Asia base oils supply outlook: Week of 5 May
- Serica Energy Plc (AIM: SQZ): Catalysts Ahead
- Global base oils margins outlook: Week of 5 May
- Global base oils arb outlook: Week of 5 May
- Nuvoco Vistas: Improving Performance and Strategic Expansion
- Phillips 66: Its Expansion & Integration of Midstream Operations With A Focus On NGLs Might Just Pay Off!
- Americas/EMEA base oils supply outlook: Week of 5 May
Errors in Local Street’s Projections for the KOSPI 200 Rebalancing
- One local desk misread the KOSPI 200 rules, thinking one screen was enough — but it’s a strict two-step filter, and that led to three wrong delete calls.
- KRX will drop the rebalance list post-close on May 21 or 22, and despite well-telegraphed outcomes, strong next-day price action has followed in past cycles.
- Consider a pre-announcement long/short basket trade, as this is the first rebalance post-short-selling resumption. NXT’s rising market share also creates opportunities in overnight-daytime price spreads.
Nihon Parkerizing (4095) – 3mos Left on Big Buyback
- Last year in August, Nihon Parkerizing (4095 JP) announced a large buyback – up to 12.0mm shares (9.6%) spending up to ¥15.0bn over the next 11.5mos.
- So far, they have spent ¥9.1bn buying back 7.3mm shares. That’s ¥5.9 left to spend in 3mos.
- It’s worth a look to see how this has evolved and how it might evolve into the end of the buyback. And it’s cheap, though tariff uncertainty exists.
KOSPI200 Index Rebalance Preview: 7 Changes a Side for June
- With the review period complete, there could be 7 changes for the Korea Stock Exchange KOSPI 200 (KOSPI2 INDEX) in June.
- The impact on the potential inclusions ranges from 1.6-22 days of ADV while the impact on the potential deletions varies from 3.6-16.5 days of ADV.
- Han Kuk Carbon (017960 KS) appeared as a forecast add in the week starting 22 March and the stock is up 38% since then.
Asia base oils supply outlook: Week of 5 May
- Asia’s base oils prices extend rise vs feedstock/gasoil prices.
- Sustained strength of base oils margins points to limited surplus supply even as firm prices incentivize refiners to boost output.
- Limited surplus supply at end-Q1/early-Q2 2025 follows seasonal rise in demand and heavy round of plant maintenance.
Serica Energy Plc (AIM: SQZ): Catalysts Ahead
- The envisaged merger between EnQuest and Serica is not proceeding at this time.
- Given the drop in Brent since the potential transaction leaked on 7 March, this outcome is unsurprising.
- Given Serica’s prospects as a standalone company, there was no imperative for the company to force a deal.
Global base oils margins outlook: Week of 5 May
- Global base oils prices extend rise vs feedstock/competing fuel prices.
- Outright prices mostly hold firm or rise even in face of ongoing dip in crude oil/diesel prices.
- Contrasting trends point to stronger base oils fundamentals relative to crude/diesel.
Global base oils arb outlook: Week of 5 May
- Europe Group III base oils price trends higher vs prices in US and Asia over past two months.
- Europe Group III price trends higher vs domestic Group I price and VGO, holds firm vs domestic Group II price.
- Europe’s firmer Group III price differentials could reflect correction following sustained weakness.
Nuvoco Vistas: Improving Performance and Strategic Expansion
- Nuvoco reported improved volumes, margins, and deleveraging in FY25, with continued focus on cost optimization and operational efficiency.
- The Vadraj Cement acquisition expands capacity to 31 MTPA, diversifying regional exposure and strengthening presence in Gujarat and Maharashtra – west region.
- Valuations are reasonable at ~16x FY27E earnings and ~Rs5,100/ton EV/ton, but upside depends on timely integration and ramp-up of new assets.
Phillips 66: Its Expansion & Integration of Midstream Operations With A Focus On NGLs Might Just Pay Off!
- Phillips 66’s first quarter 2025 earnings overview reflects both strategic advancements and current operational challenges faced by the company.
- Mark Lashier, the Chairman and CEO, emphasized the company’s focus on executing its transformational strategy despite a challenging macro-economic environment in the Refining, Renewables, and Chemicals segments.
- The company reported $487 million in earnings but an adjusted loss of $368 million, attributing this to factors such as accelerated depreciation and the impact of significant turnaround activities, which temporarily affected volumes and margins.
Americas/EMEA base oils supply outlook: Week of 5 May
- US base oils prices extend rise vs feedstock/competing fuel prices.
- Rising base oils margins point to supply-demand fundamentals that are firm enough to support the higher price differentials.
- Supply fundamentals likely to be tighter in early Q2 2025 amid heavy round of plant maintenance work in North America.
💡 Before it’s here, it’s on Smartkarma
Sign Up for Free
The Smartkarma Preview Pass is your entry to the Independent Investment Research Network
- ✓ Unlimited Research Summaries
- ✓ Personalised Alerts
- ✓ Custom Watchlists
- ✓ Company Data and News
- ✓ Events & Webinars
