In today’s briefing:
- Kokusai Electric (6525) – Upcoming Lockup Expiry And BIG Index Demand
- SHIFT (3697) The Next – Potential Big Index Add
- Nikkei 225 Index Rebalance Preview (Mar 2025): SHIFT Splits; Updated Ranking, Capping & Funding
- Taiwan Dual-Listings Monitor: TSMC Premium Near All-Time Highs; CHT Rare Discount Level
- STAR Chip Index Rebalance Preview: Changes in March
- Destiny XYZ Is Destined to Crash
- EQD | Hong Kong Single Stock Options Weekly January 06 – 10
- EQD | Hong Kong Index Options Weekly – HSI and HSCEI January 06 – 10
- Aequitas 2025 Asia IPO Pipeline – Japan and South Korea
- Tech Supply Chain Tracker (14-Jan-2025): TSMC ends PowerAIR Huawei partnership.
Kokusai Electric (6525) – Upcoming Lockup Expiry And BIG Index Demand
- Kokusai Electric (6525 JP) was IPOed in September 2023. The stock was cheap. It rose sharply, tripling in 9 months. At the ATH, the pre-IPO owners launched a HUGE secondary.
- It was like a second IPO. The stock dipped, rallied, plummeted into pricing. Stayed there for two days, and in 6 months, the shares have halved.
- Lockup expiry is next week, and there is a likely large index event in ~10 weeks.
SHIFT (3697) The Next – Potential Big Index Add
- Shift Inc (3697 JP) is a high-growth stock in the software services, testing, consulting, development business. They have a big specialist TAM ahead of them.
- Revenue is up 50-fold in 10 years. OP is up 85-fold in that period. Revenue is guided +17.5% in the year to Aug 2025. OP is guided +28%.
- There is an event coming up shortly which could trigger an imminent index inclusion. It’s worth a look.
Nikkei 225 Index Rebalance Preview (Mar 2025): SHIFT Splits; Updated Ranking, Capping & Funding
- The review period for the Nikkei 225 Index March rebalance ends in 3 weeks. There could be one outright change and one or two others driven by sector balance.
- Shift Inc (3697 JP) will have a 15:1 stock split next week and that puts the stock in the list of potential inclusions over the next couple of rebalances.
- The recent drop in Fast Retailing (9983 JP)‘s stock price will lead to a single step drop in the PAF. That means less passive selling and a smaller funding buy.
Taiwan Dual-Listings Monitor: TSMC Premium Near All-Time Highs; CHT Rare Discount Level
- TSMC: +28.4% Premium; Near-All-Time High, Good Level to Short the Spread
- UMC: -0.4% Discount; Fifth Consecutive Month of Increase in ADR Headroom
- CHT: -0.9% Discount; Good Level to Go Long the Spread
STAR Chip Index Rebalance Preview: Changes in March
- There could be 1 constituent change for the STAR Chip Index at the March rebalance. There will also be a few capping changes.
- Estimated one-way turnover is 6.5% resulting in a round-trip trade of CNY 3.12bn (US$426m). Passives need to trade between 0.24-0.33x ADV in the potential changes.
- There is one very close add and the final list could change depending on price performance over the next 10 trading days.
Destiny XYZ Is Destined to Crash
- Market Euphoria and Investment Challenges: Trump’s re-election has fueled excitement in the stock market, especially for Elon Musk-linked companies, but investing in SpaceX remains difficult due to its private status.
- Proxy Stocks: Investors can access SpaceX indirectly through proxy stocks like Rocket Lab (RKLB) or funds such as Destiny Tech100 Inc. (DXYZ) and the ARK Venture Fund (ARKVX).
- Valuation Concerns on DXYZ: Despite DXYZ’s significant outperformance compared to other proxies, its rapidly expanded market cap/fair value multiple raises concerns about overvaluation and stock price sustainability.
EQD | Hong Kong Single Stock Options Weekly January 06 – 10
- Tough week with 82% of optionable stocks we survey declining on the week but no sign of panic as investors still prefer Calls over Puts.
- Tencent was far and away the volume leader, accounting for 37% of all option trading.
- Materials was the only Sector to see price gains and implied vol rose across all Sectors we survey.
EQD | Hong Kong Index Options Weekly – HSI and HSCEI January 06 – 10
- HSI and HSCEI were down every day this past week.
- HSI total Put volume heavier than total Call volume on the two largest down days this week showing rising concern amongst investors.
- Having dropped 5.6% to start the year HSI has already moved well past the implied move at the start of the month.
Aequitas 2025 Asia IPO Pipeline – Japan and South Korea
- In this note, we will take a look at the Asia Pacific IPO pipeline for 2025, with a look at Japan & Korea after having looked at HK & India.
- This list has been compiled on a best effort basis from tracking the company filings and through various other sources.
- The deals you see in this note are only a part of our full IPO pipeline tracker. Feel free to drop us a message for additional information on these IPOs.
Tech Supply Chain Tracker (14-Jan-2025): TSMC ends PowerAIR Huawei partnership.
- TSMC ends partnership with PowerAIR in Singapore over Huawei worries, impacting supply chain in tech industry.
- China retaliates against US with customs actions; CXMT starts manufacturing DDR5 chips, meeting demand for next-gen technology.
- India plans display fabrication facility, offering growth potential but encountering challenges. Luxshare’s purchase of Wingtech ODM to enhance design capabilities, reduce reliance on Apple, and boost tech industry prowess.
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