In today’s briefing:
- India: Potential Free Float Changes & Passive Flows in August
- Horizon Robotics (9660 HK): Index Inclusion & Upweights to Drive US$1bn Inflows
- Southeast Asia: Potential Global Index Deletions in August
- Hong Kong 2025 Placements – Year so Far and Trends for Potential Primary Placements
- Korea: 3 Potential Index Deletions in August; Positioning Watch
- [Japan M&A] ¥4,870/Sh Blackstone TOB for Technopro (6028 JP) – Watch the Parameters and Modalities
- [Japan M&A] 99Soft MBO at 52% Premium Is Too Light But A Bump May Be Tough
- Hisense Home Appliances (921 HK): Global Index Deletion Coming Up
- A Hidden Trading Angle from Dividend Tax Reform: Tax Timing Creates Dividend Trap Risks
- Infomedia (IFM AU): TPG’s Clean Deal
India: Potential Free Float Changes & Passive Flows in August
- Companies in India have disclosed their shareholding pattern as of end-June in July. There are companies with significant float changes from end-March and/or end-December.
- The changes in free float could be reflected in domestic and global indices over the next few weeks and months resulting in flow from passive trackers.
- Depending on the date that the shareholding was published, there could be 11 stocks with passive inflows from global trackers while 5 could have passive outflows in August.
Horizon Robotics (9660 HK): Index Inclusion & Upweights to Drive US$1bn Inflows
- There should be big passive inflows to Horizon Robotics (9660 HK) over the next 6 weeks and that could take the stock higher in the short term.
- Southbound Stock Connect investors have bought more than 10% of the Class B shares outstanding since the stock was added to the link a couple of months ago.
- Short interest jumped following the Stock Connect inclusion but there has been covering over the last few weeks. Short-term direction for the stock price looks to be higher.
Southeast Asia: Potential Global Index Deletions in August
- There are 4 stocks listed in Malaysia and Thailand that could be deleted from passive portfolios in August.
- There is a fair bit to sell in the stocks with over US$70m flow and between 10.7-44.5x ADV.
- The positioning in most stocks does not cover the estimated passive selling and there could be more selling over the next few weeks.
Hong Kong 2025 Placements – Year so Far and Trends for Potential Primary Placements
- 2025 has seen a sharp turnaround in HK placements, with 36 US$100m+ deals so far. This compares to only 14 in 2022, 13 in 2023, and 15 in 2024.
- Most of the 2025 placements have been primary raising and have come from a handful of sectors/backdrops.
- In this note, we try to identify the possible primary placements that could take place over the rest of the year.
Korea: 3 Potential Index Deletions in August; Positioning Watch
- There are 3 stocks in Korea that could be deleted from a global index in August and that will result in large selling from passive trackers.
- Short interest has increased in all 3 stocks since the resumption of short selling. Cumulative excess volume is higher in all stocks over the last couple of months.
- Given the increase in shorts and positioning, there could be short covering in two of the three stocks. The third could still drop over the next couple of weeks.
[Japan M&A] ¥4,870/Sh Blackstone TOB for Technopro (6028 JP) – Watch the Parameters and Modalities
- This was signaled in May, somewhat confirmed in July, now done. Blackstone buys Technopro at ¥4,870/share which is ~14x EV/EBITDA for next year.
- PE Firms have been scouring the Japanese market to buy companies. The METI Corporate Takeover Guidelines are super-helpful in that regard. This will squeeze the market over time.
- This takeover price is not quite as full as it could have been, and there are some parameters and modalities to this which are worth looking at. Parameters and Modalities.
[Japan M&A] 99Soft MBO at 52% Premium Is Too Light But A Bump May Be Tough
- Soft99 Corp (4464 JP) is the owner/operator of a set of ubiquitous brands in aftermarket autocare. Anything to do with washing, cleaning, etc.
- The company was founded 70 years ago, and the CEO is 54yrs old. Smells like succession planning.
- This deal is a nice premium, but it is too light. The operating assets with consistent growth and 20% OPMs are being sold at <0.9x book. That’s bad.
Hisense Home Appliances (921 HK): Global Index Deletion Coming Up
- The fall in Hisense Home Appliances Group (921 HK)‘s stock price over the last year puts it at risk of deletion from a global index in August.
- Short interest and positioning have picked up in the stock over the last couple of weeks and there should be short covering against the passive selling.
- The AH premium for Hisense Home Appliances Group could increase over the near-term as positioning continues ahead of the passive selling.
A Hidden Trading Angle from Dividend Tax Reform: Tax Timing Creates Dividend Trap Risks
- With new tax rules kicking in from FY2026, firms may hold back FY2025 dividends to front-load later, creating potential downside surprise purely from tax-driven deferral, not fundamentals.
- If FY2025 payouts fall short, dividend names could go ex-div on inflated expectations, then trade heavy — setting up mispricing risk around year-end dividend capture trades.
- This may weaken post-ex-div price rebounds, creating dividend trap risks and short-term mispricing that traders can exploit via shorts, dip buys, or dividend swap long-short strategies.
Infomedia (IFM AU): TPG’s Clean Deal
- Infomedia Ltd (IFM AU), a automotive software firm, has entered into a Scheme Implementation Deed with PE-outfit TPG.
- TPG is offering A$1.72/share, a 30% premium to last close. The transaction requires FIRB signing off. The Offer has the unanimous backing of Infomedia’s boards.
- As discussed in Infomedia (IFM AU): Now A Three-Way Hunt, Infomedia fielded various indicative Offers (including TA Associates/Viburnum, Battery Ventures, and Solera) in 2022, none of which went the distance.
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