In today’s briefing:
- Kospi: Rising Volatility and Early Warnings From a Seven-Month Surge
- Asian Equities: Model Portfolio Outperformed Sharply; Less China Consumption, More Korea Defence
- SemiFive IPO Valuation Analysis
Kospi: Rising Volatility and Early Warnings From a Seven-Month Surge
- Kospi’s rally has extended seven months and now shows signs of fatigue, trading with speculative assets and now sharply diverging.
- Implied volatility is elevated, with short-term measures above the 90th percentile on multiple lookbacks.
- We recommend an option trade and hedge given the current setup.
Asian Equities: Model Portfolio Outperformed Sharply; Less China Consumption, More Korea Defence
- Since the last rebalancing of our portfolio on 5th September, it has returned 13.5% vs 9.5% from MSCI-Asia-ex-Japan. Since inception (15th May), our portfolio has appreciated 20.1% vs MXASJ’s 18.6%.
- Six stocks, SK Hynix, TSMC, Samsung Electronics, Alibaba, China Hongqiao, Tencent, contributed almost the entire return of our portfolio. Overweight on Korea drove more than half the portfolio’s return.
- We turn more selective on Chinese discretionary consumption and step into the Korean defense sector. We exclude Anta Sports and Mediatek and include Hyundai Rotem and Hon Hai Precision.
SemiFive IPO Valuation Analysis
- Our base case valuation of SemiFive is implied market cap of 1.4 trillion won or target price of 42,349 won per share.
- This is 76% higher than the high end of the IPO price range (24,000 won per share). Given the excellent upside, we have a Positive View of this IPO.
- SemiFive is one of the global leaders in custom AI semiconductor (ASIC) design. Founded in 2019, SemiFive is a SoC platform company specializing in AI inference and high-performance computing (HPC) chip design.
💡 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
