In today’s briefing:
- EOFlow Tender Offer: Preconditions for Closure, Cancellation Risk, & Targetable Allocation
- ISC’s Tender Offer Possibility Is Decreasing, Indicating a Potential Shorting Opportunity
- Classys (214150 KS): Strong 1Q23 Result Lifted by Overseas Performance and Consumables Sales
EOFlow Tender Offer: Preconditions for Closure, Cancellation Risk, & Targetable Allocation
- The likelihood of the merger review not being approved appears to be low. Additionally, the purchase of only 3.8M additional shares is required, leading to a negligible cancellation risk.
- It is particularly noteworthy that the offering price of ₩30,000, targeting minority shareholders, may be adjusted upward depending on future share price increases.
- While there is a potential allocation risk, as Medtronic aims to delist the company, they are unlikely to lower the target quantity in the tender offer to a risky level.
ISC’s Tender Offer Possibility Is Decreasing, Indicating a Potential Shorting Opportunity
- The possibility of SKC securing additional shares other than the planned 40% through a tender offer seems low. This is a basis for the recent short position build-up in ISC.
- ISC began to experience an influx of short selling, leading to it being designated as an overheated short-selling stock, and short selling was restricted for one day on the 26th.
- We need to pay attention to the potential disappointment in the market, which could lead to a sustained downward correction in the stock price.
Classys (214150 KS): Strong 1Q23 Result Lifted by Overseas Performance and Consumables Sales
- Classys (214150 KS) reported solid performance in 1Q23, with double-digit revenue growth, driven by expansion of domestic consumables sales for Shrink Universe and growth in overseas device and consumables sales.
- Operating profit increased 19% YoY to KRW 19.9 billion, leading to 380 basis point margin expansion to 51%. Net profit increased 46% YoY to KRW 18.8 billion.
- Classys continues to strengthen its competitiveness through product line and geography expansion. The company has reiterated 2023 revenue guidance of KRW170 billion, representing year-over-year increase of 20%.
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