In today’s briefing:
- FTSE China A50 Index Ground Rule Change: Big Flows & Large Turnover in March
- End of Lock-Up Periods for Kakao Pay, Kakao Bank, Krafton, HHI, & SD Biosensor in 1Q 2022
- XP (XP US) – Modal Acquisition Edges the Needle Higher on AuC, but It Is No Bargain
FTSE China A50 Index Ground Rule Change: Big Flows & Large Turnover in March
- A ground rule change will see Foreign Ownership Restrictions and Minimum Foreign Headroom Requirements applied to the FTSE China A50 Index (XIN9I INDEX) universe from the March rebalance.
- There will be plenty of stocks that will see their investability weight reduced. We estimate a one-way turnover of 15.2% and one-way trade of CNY 8.04bn due to the change.
- Bank Of Ningbo Co Ltd A and Will Semiconductor Ltd are locked in a race for index inclusion in March, while Chongqing Zhifei Biological Products (300122 CH) could be deleted.
End of Lock-Up Periods for Kakao Pay, Kakao Bank, Krafton, HHI, & SD Biosensor in 1Q 2022
- In this insight, we discuss the end of lock-up periods for Kakao Pay, KakaoBank, Hyundai Heavy Industries, Krafton Inc, and SD Biosensor in 1Q 2022.
- Typically, investors tend to focus on the end of the lock-up periods in Korea about 1-2 months ahead of the actual end of these lock-up periods.
- Among these five companies, there are relatively large number of shares that could be sold post end of the lock-up periods for Kakao Pay and Kakao Bank in 1Q 2022.
XP (XP US) – Modal Acquisition Edges the Needle Higher on AuC, but It Is No Bargain
- XP’s offer for the smaller Modal values it at 10% of assets under custody (AuC) which is just a slight discount to XP’s market value of 11% of AuC
- The acquisition should add 15% to XP’s active client base, yet it should add a mere 4% to AuC; relative to XP, Modal has 25% of average assets per client
- We believe that the impact of this bolt-on M&A is marginal at best, given the intense competition from larger wealth managers, such as the wealth arm of BTG Pactual
Before it’s here, it’s on Smartkarma
