Daily BriefsEvent-Driven

Event-Driven: Yidu Tech Inc, Money Forward, SK IE Technology, 5G Networks Ltd/Australia, Hana Financial and more

In today’s briefing:

  • Yidu Tech (医渡云) Lock-Up Expiry – About US$2bn Worth of Shares Unlocked
  • TOPIX Inclusion: Money Forward (3994) Could Outperform Freee (4478) Until End of Month
  • KRX BBIG Index Rebalance Preview: SK Bioscience & SK IE Tech Inclusions Add to Passive Inflow
  • Webcentral – 5GN Merger: A Small-Cap Merger Aimed at ASX300 Status
  • Korean Local Banks Trading Dynamics: Dividend Yield Difference & Kakao Bank Listing

Yidu Tech (医渡云) Lock-Up Expiry – About US$2bn Worth of Shares Unlocked

By Zhen Zhou, Toh

Yidu Tech Inc (2158 HK) (Yidu) IPO lock-up expired on 15th July, 2021. Earlier in January, the company raised about US$539m in its Hong Kong IPO after pricing at HK$26.30 per share, the top-end of the price range.

Yidu is a healthcare data solution provider. It leverages big data and artificial intelligence (AI) technologies and provides solutions to key healthcare participants that include mainly hospitals, pharmaceutical, biotech and medical device companies, regulators and policy makers. 

Our previous coverage of the IPO:


TOPIX Inclusion: Money Forward (3994) Could Outperform Freee (4478) Until End of Month

By Janaghan Jeyakumar, CFA

Cloud-based business accounting software company Money Forward (3994 JP)  announced on 7th June 2021 that they had received approval to move from the Mothers Section to the First Section of the Tokyo Stock Exchange which triggers inclusion into the TOPIX Index. Previously, this situation was covered in TOPIX Inclusion: Money Forward (3994 JP)

On 15th July 2021, Money Forward (3994 JP) announced earnings for the quarter ending May 2021. Below is a closer look at how the stock has traded since the TSE1 promotion was announced and the upside potential for the remainder of the event timeline. 


KRX BBIG Index Rebalance Preview: SK Bioscience & SK IE Tech Inclusions Add to Passive Inflow

By Brian Freitas

The KRX will announce the results of the September review of the BBIG indices in August and the changes will become effective after the close of trading on 9 September.

The review period ends on 31 July, so there are only 10 trading days left and the list of potential inclusions and exclusions will not change unless there is a big change in stock prices.

At the September review we expect the following changes:

The largest inflows will be on SK Bioscience (302440 KS), SK IE Technology (361610 KS), LG Chem Ltd (051910 KS), SK Innovation (096770 KS) and Douzone Bizon (012510 KS) while the largest outflows will be on SK Biopharmaceuticals Co Ltd (326030 KS), Kakao Corp (035720 KS), Posco Chemical Co Ltd (003670 KS), Kakao Games Corp (293490 KS) and SKC Co Ltd (011790 KS).

With Krafton Inc (259960 KS) expected to list in August, post the cutoff date of 31 July, the stock will not be eligible for index inclusion at the review and will need to wait till the following rebalance in March 2022 to join the Game and BBIG indices.


Webcentral – 5GN Merger: A Small-Cap Merger Aimed at ASX300 Status

By Janaghan Jeyakumar, CFA

Australian small-cap Telco company 5G Networks Ltd/Australia (5GN AU) and related company Webcentral (WCG AU) announced on Friday that they have agreed to merge in a Scrip Transaction that will see 5GN shareholders receive 2 WCG shares per 5GN share. 

The companies claim that the Merger will “create a larger entity with a single shareholder base propelling the company towards ASX300 status“.   

The Deal is conditional on shareholder approvals from both companies and is expected to be completed in late-October 2021. 

More below the fold. 

For more information about M&A rules, regulations, and practices in Australia, please refer to Quiddity Australia M&A Guide 2019 and Quiddity M&A: Australia Foreign Investment Reforms 


Korean Local Banks Trading Dynamics: Dividend Yield Difference & Kakao Bank Listing

By Sanghyun Park

Over the past month, the stock performance of the four largest banks in Korea has been interesting. Hana Financial Group and Woori Financial Group outperformed relatively, and in particular, KB Financial Group underperformed by more than 5%p compared to Woori Financial Group.

In this interim dividend, there is a possibility that dividends not paid last year will be paid retroactively. However, excluding this possibility and assuming that the total annual dividend for this year is adjusted to the level of 2019, Woori Financial Group and Hana Financial Group have the highest dividend yields.

Estimated dividend yield, assuming that the total annual dividend for. this year is adjusted to the level of 20192018201920202021E
Shinhan Financial4.04%4.27%4.68%5.06%
KB Financial4.13%4.64%4.08%5.26%
Hana Financial5.24%5.69%5.36%6.20%
Woori Financial
6.03%3.70%6.63%
Source: FnGuide & KSD Seibro

This is similar to the dividend yield calculated based on this year’s estimated DPS of local street consensus gathered by FnGuide.

Annual dividend yield based on the local street consensus compiled by FnGuide2018201920202021E
Shinhan Financial4.04%4.27%4.68%5.20%
KB Financial4.13%4.64%4.08%5.15%
Hana Financial5.24%5.69%5.36%6.05%
Woori Financial
6.03%3.70%6.33%
Source: FnGuide & KSD Seibro

As shown in the downward trend of 12M forward PER below, the market is taking a conservative approach to the recent slowdown in bank stocks’ earnings growth, which is believed to have led to growing interest in dividends.

Interestingly, the difference in P/E decline between Hana Financial Group and KB Financial Group was the largest. This seems to have been influenced by the fact that Hana Financial Group has a higher probability of paying expected dividends than Woori Financial Group.

12-month forward PER2021. 7. 163 months ago3-month Δ
Shinhan Financial5.03x5.12x-1.76%
KB Financial5.17x5.65x-8.50%
Hana Financial4.21x4.35x-3.22%
Woori Financial3.99x4.16x-4.09%
Source: FnGuide & KSD Seibro

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