In today’s briefing:
- StubWorld: SZ International’s Logistics Spin-Offs
- Ventia Services (VNT) Selected to Join ASX 200 – Not A Surprise
- Initial Thoughts on the SK Ecoplant IPO – Impact on SK Inc
- Zhuzhou CRRC Times Electric (3898): Growth at a Discounted Valuation
- DXY Break Below $101 Suggests Breakouts Likely Coming for Equal-Weight SPX, Dow, and Russell 2000
- Investigating HMM’s Latest Bond Conversion Situation for a Shorting Setup
- NodeFlair Gets US$2M in Series A Funding to Further Expand, Accelerate Product Development
StubWorld: SZ International’s Logistics Spin-Offs
- Shenzhen International (152 HK) seeks to spin off logistic assets on a PRC exchange; and 51.56%-held Shenzhen Expressway Co H (548 HK) intends to place out A shares.
- Preceding my comments on SZ Int’l/SZ E’Way are the current setup/unwind tables for Asia-Pacific Holdcos.
- These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation >20%.
Ventia Services (VNT) Selected to Join ASX 200 – Not A Surprise
- After the Blackmores Ltd (BKL AU) Scheme Meeting result was announced earlier today, post-close the S&P/ASX team announced Ventia (VNT AU) would replace it on 21 July at the close.
- This is not that surprising. Janaghan Jeyakumar, CFA expected it in June, and it was a super-close second recently for him for the Sep rebalance.
- Given the shareholder structure and flow dynamics, it’s worth taking a closer look.
Initial Thoughts on the SK Ecoplant IPO – Impact on SK Inc
- SK Ecoplant is getting ready to complete its IPO sometime in late 2023/1H 2024.
- Local media have mentioned that SK Ecoplant’s market cap could range from 5 trillion won to 10 trillion won.
- At the end of 2022, SK Inc’s 44.5% stake in SK Ecoplant had a book value of 545 billion won, which is much less the market value of SK Ecoplant.
Zhuzhou CRRC Times Electric (3898): Growth at a Discounted Valuation
- The company has shifted its growth driver from rail equipment to EV parts supplier.
- Q1 23 growth came from emerging equipment coming to the rescue at a double digit rate when the train equipment segment recorded a slight decrease.
- Compared to last year, the company is trading at a lower valuation, yet its key growth driver has a better and more sustainable quality.
DXY Break Below $101 Suggests Breakouts Likely Coming for Equal-Weight SPX, Dow, and Russell 2000
- Ever since our 5/30/23 ETF Pathfinder, our view has been that we cannot be bearish unless a key support level breaks (at the time, that was 4050 on the SPX).
- The S&P 500 is now above 4300-4325 — a level that, in January this year, we had anticipated would cap upside for 2023.
- We believe 4300-4325 will act as major support moving forward, and we are bullish as long as the SPX is above 4300; we discussed this in our 7/3/23 ETF Pathfinder.
Investigating HMM’s Latest Bond Conversion Situation for a Shorting Setup
- Those that the local market is particularly interested in are the 192nd convertible bonds (CB) held by KDB, along with the 193rd bonds with warrants (BW) owned by KOBC.
- These two bonds’ call option exercise date is September 25th. Upon conversion of these bonds, 200M new shares will be issued (41% of SO and a 30% dilution).
- The key is the trade-off between not disrupting the selling process and avoiding any breach of trust. The prevailing local sentiment suggests that KDB and KOBC will choose stock conversion.
NodeFlair Gets US$2M in Series A Funding to Further Expand, Accelerate Product Development
- NodeFlair, a Singapore-based career advancement platform for tech talents, announced today that it has raised US$2 million Series A funding.
- The funding round was led by Iterative with participation from 500 Global and PERSOL VENTURE PARTNERS, the corporate venture capital arm of HR management group PERSOL.
- Prominent angel investors Quek Siu Rui (CEO & Co-founder of Carousell), JJ Chai (CEO & Co-founder of Rainforest), and Siew Kum Hong (Former COO of AirBnB China) also participated in the funding round.
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