In today’s briefing:
- Hang Seng TECH Index Rebalance: Float & Capping Changes
- Weimob (2013 HK): Strategic Patience Will Be Rewarded (Part 2)
- Hang Seng Tech Rebalance Dec 2022 – No Name Changes, Decent Flow
- Taiwan Tech Weekly: AMAT Results Buoy Market, But Nanya at Risk, Foreigners Massively Buy Taiwan
Hang Seng TECH Index Rebalance: Float & Capping Changes
- As expected, there are no adds or deletes for the Hang Seng Tech Index (HSTECH INDEX) in December. However, there are plenty of capping and float changes to drive flows.
- The December rebalance is expected to have a one-way turnover of 2.3% resulting in a one-way trade of HK$1.9bn.
- Short interest is greater than 5% of float on a few stocks and a continued recovering in markets could lead to a squeeze higher.
Weimob (2013 HK): Strategic Patience Will Be Rewarded (Part 2)
- Weimob has emerged from the pandemic stronger and leaner, further consolidating its leadership in China’s e-commerce SaaS market.
- Drawing insights into the supply side (merchants/brands) on Alibaba platform, our bottom-up analysis suggests that Weimob potentially has a US$600mn revenue opportunity by 2025.
- We value Weimob at US$3bn assigning 5xPS on its US$600mn revenue by 2025, implying 25% CAGR over 3-year period. Patience needed to navigate high-inflation environment which pressures growth assets.
Hang Seng Tech Rebalance Dec 2022 – No Name Changes, Decent Flow
- The Hang Seng Tech Index Review was announced on Friday after the close. There are no name changes but there is decent flow. 3% one-way turnover.
- There are five capping changes and one very large share count change making things interesting.
- All told, this is less impactful than it was last time, and less impactful than the other index rebalances announced.
Taiwan Tech Weekly: AMAT Results Buoy Market, But Nanya at Risk, Foreigners Massively Buy Taiwan
- Applied Materials (AMAT US) guidance buoyed the overall industry, but negative Memory news from AMAT and Micron make Nanya Technology (2408 TT) shares look at risk of near-term pullback.
- Foreigners massively net-bought Taiwan over the last two weeks, and United Microelectronics Corp (2303 TT) has been a major recipient of capital. ADR premium still has legs.
- Hon Hai Precision Industry (2317 TT) received 100,000+ new worker applications but now has trouble finding space for them! We remain structurally bullish on the company.
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