Daily BriefsFinancials

Financials: Chukyo Bank, SinoPac Holdings, Meritz Fire & Marine Insurance, Ichigo Inc, Jasmine Broadband Internet Infrastructure Fund, Banco Bradesco SA and more

In today’s briefing:

  • Chukyo (8530) + Aichi (8527) Bank to Create Aichi Fin’l Group – Interesting Structure Adds Value
  • FTSE TWSE Taiwan 50 Index Rebalance Preview: Sinopac Holdings Could Replace Momo.com
  • KOSPI 200 Rebalancing: Shorting Event for Additions
  • FTSE EPRA Nareit Developed Asia Preview: Two Adds Near the Inclusion Threshold
  • JASIF: 1Q22 Core Profit Remains Flat, In-Line with Our Expectation
  • Aikya Q1 2022 Investor Letter

Chukyo (8530) + Aichi (8527) Bank to Create Aichi Fin’l Group – Interesting Structure Adds Value

By Travis Lundy

  • Chukyo Bank (8530 JP) and Aichi Bank (8527 JP) have decided to join forces to become the largest regional lender in the Nagoya area. 
  • This is probably driven by MUFJ’s efforts to rid itself of non-core assets, but in doing so, it is allowing for an accretive structure for minorities.
  • This ends up being a cheap bank on a slightly complicated pro-forma basis.

FTSE TWSE Taiwan 50 Index Rebalance Preview: Sinopac Holdings Could Replace Momo.com

By Brian Freitas

  • The next FTSE TWSE Taiwan 50 Index review will use data from 23 May. The changes will be announced on 3 June and implemented at the close on 17 June.
  • Momo.Com Inc (8454 TT) is a potential deletion from the index, while SinoPac Holdings (2890 TT) should be included as the highest ranked non-index constituent.
  • SinoPac Holdings (2890 TT) has over 3.5 days of ADV to buy from passive funds and trades cheaper than its peers. The stock could outperform over the next few weeks.

KOSPI 200 Rebalancing: Shorting Event for Additions

By Sanghyun Park

  • There is a clear correlation between the resumption of short selling and the overvaluation of stock prices, which was actively reflected when short selling resumed.
  • So, in this rebalancing as well, we need to target those who have seen a significant share price rise recently while looking at the increasing trend of the loan balance.
  • The stocks to watch are Meritz Fire and Hana Tour as their recent share price has been the most solid. In particular, Hana Tour is conducting a capital increase.

FTSE EPRA Nareit Developed Asia Preview: Two Adds Near the Inclusion Threshold

By Brian Freitas

  • The next FTSE EPRA Nareit Index review will use data from 23 May. The changes will be announced on 1 June and implemented at the close on 17 June.
  • Potential inclusions at the review include Frasers Hospitality Trust (FHT SP) and Ichigo Inc (2337 JP), though both are very close to the basis point threshold for inclusion.
  • Digital Core REIT (DCREIT SP) has still not published an audited annual report in English and is unlikely to be included in the index at the June rebalance.

JASIF: 1Q22 Core Profit Remains Flat, In-Line with Our Expectation

By Pi Research

  • Maintain BUY with target price of Bt12.10, derived from DCF methodology (WACC=9.6%, g=0%), implying 1.1xPBV’22E.
  • 1Q22 net profit was Bt1.6bn(-9% YoY, -36% QoQ) due to asset revaluation losses.
  • Excluding unrealized loss from asset revaluation of Bt600m,1Q22 core profit remained flat both YoY and QoQ at Bt2.2bn,in line with our forecast due to flat YoY and QoQ revenue atBt2.5bn.

Aikya Q1 2022 Investor Letter

By Fund Newsletters

  • Aikya Investment Management is an independent, employee-owned, investment management company that specialises in managing Emerging Markets equity portfolios.
  • The strategy has returned 14.6% returns in USD terms since its inception in March 2020.
  • We remain highly optimistic on the long-term prospects of Emerging Markets.

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