In today’s briefing:
- MV Australia Equal Weight Index Rebalance Preview: Three Potential Deletions in September
- HMM Tender Side Play: Targeting a Basis Squeeze Ahead of Sep Expiry
- Trading Halt on 79 NXT Stocks in Korea: Screening Key Names to Watch for Spread Plays
- Aux Electric Pre-IPO: Competitive Niche
- Shuangdeng Group IPO: Weak Earnings This Year but Potentially Hot Data Centre Trade
- Vikram Solar IPO – RHP Updates, Peer Comp and Thoughts on Valuations
- Aux Electric IPO: The Investment Case
- Mid & Small Cap Surge: Liquidity, Inflows and Big Movers Since May
- Eaton Corporation Bets on AI & Tech Integration—Is This the Future of Smart Power?
- Cummins Inc.: Power Systems Surge Sparks Big Profit Gains What Broader Challenges Does The Company Face?
MV Australia Equal Weight Index Rebalance Preview: Three Potential Deletions in September
- Nearing the end of the review period, we forecast no inclusions to the index in September. There could be up to 3 deletions at the review though.
- Even if there are no constituent changes, capping changes will lead to one-way turnover of 3.8% and a round-trip trade of A$232m.
- If there are 3 deletes as forecast, one-way turnover increases to 6.3% resulting in a round-trip trade of A$384m.
HMM Tender Side Play: Targeting a Basis Squeeze Ahead of Sep Expiry
- Most traders are starting in September, rolling into October. Sep/Oct spread volume has picked up unusually fast, clearly reflecting hedge demand linked to the tender
- As September expiry approaches, basis-squeeze risk rises, likely pushing September cheap and October expensive, widening the spread — creating a clear side trade opportunity.
- With a basis squeeze expected near September expiry, we could enter a Sep/Oct spread (short Sep, long Oct) and also watch for spot-futures decoupling to play the cash-futures spread.
Trading Halt on 79 NXT Stocks in Korea: Screening Key Names to Watch for Spread Plays
- NXT’s halt will be live tomorrow, likely shaking local flows. With 15–20% tape share, blocked tickers spill to KRX, thinning books, widening spreads, and hitting retail-heavy liquidity.
- When NXT goes dark, books thin, fills slip, and prices swing sharply — widening spreads and creating risk (or alpha) in retail-heavy tickers for short-term or intraday trades.
- Below is a hit list of 500B+ KRW stocks where NXT takes 40%+ volume — watch these Phase 1 tickers as trading halts shake up flow and spreads.
Aux Electric Pre-IPO: Competitive Niche
- Aux Electric Co Ltd (0917839D HK) is looking to raise up to US$600m in its upcoming Hong Kong IPO.
- It is one of the global top five air conditioner providers, with capabilities covering the design, R&D, production, sales and related services of household and central air conditioners.
- In this note, we look at the firm’s past performance.
Shuangdeng Group IPO: Weak Earnings This Year but Potentially Hot Data Centre Trade
- Shuangdeng Group Co Ltd (JISHUZ CH) is looking to raise around US$109m in its upcoming Hong Kong IPO.
- It’s a global leader in energy storage business for big-data and telecommunication industries with a diverse customer base comprising telecom base station operations, data centers, power stations and power grids.
- In this note, we examine the IPO dynamics, and look at the firm’s valuation.
Vikram Solar IPO – RHP Updates, Peer Comp and Thoughts on Valuations
- Vikram Solar (0490158D IN) is looking to raise about US$238m in its India IPO.
- Vikram Solar is an integrated solar photo-voltaic modules producer and an integrated solar energy solutions provider offering engineering, procurement and construction services, and operations and maintenance services to its customers.
- In our earlier notes, we have looked at the company’s past performance. In this note, we talk about the RHP updates, peer comp and implied valuations in the price range.
Aux Electric IPO: The Investment Case
- Aux Electric Co Ltd (0917839D HK) is the fifth-largest air conditioner provider globally as measured by volume. It is seeking to raise US$600 million.
- Aux is known for its aggressive low pricing, which has helped it establish itself as an affordable option to larger peers.
- The investment case is bullish due to strong growth, increasing contract liabilities, encouraging margin profile despite the low-price strategy/higher ODM mix and cash generation.
Mid & Small Cap Surge: Liquidity, Inflows and Big Movers Since May
- Oxley Holdings’ ADT surged to S$0.583 million since May, a 10.6× increase, with S$5.3 million profit before tax in 1HFY25.
- UOB-Kay Hian Holdings recorded S$23.09 million net institutional inflow, with P/E ratio rising from 7x to 10x.
- Non-index mid and small cap stocks attracted over S$100 million net institutional inflows since May, led by UOBKH and CSE Global.
Eaton Corporation Bets on AI & Tech Integration—Is This the Future of Smart Power?
- Eaton Corporation’s second quarter results for 2025 indicate both positive growth and areas requiring attention.
- The company’s organic sales growth stood at 8%, marking a significant achievement, as it aligned with the high end of their guidance range.
- Revenue hit a record $7 billion, alongside an adjusted EPS increase of 8%, reaching $2.95.
Cummins Inc.: Power Systems Surge Sparks Big Profit Gains What Broader Challenges Does The Company Face?
- Cummins Inc. delivered noteworthy second-quarter results for 2025, driven by exceptional performance in its Power Systems and Distribution segments, offsetting challenges faced in the North American truck market.
- During the quarter, revenues totaled $8.6 billion, reflecting a 2% decrease year-over-year, primarily due to a 6% drop in North American sales amidst a slump in the heavy- and medium-duty truck markets.
- Despite this revenue dip, Cummins achieved an increase in EBITDA to $1.6 billion, or 18.4% of sales, up from $1.3 billion (15.3% of sales) in the previous year, showcasing significant profitability improvement.
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