In today’s briefing:
- Chery Auto (9973 HK) IPO: No Inclusion in Global Indices; HSTECH Is Interesting
- Gold Miners ETF (GDX US): Benchmark Change; 8 Adds, 24 Deletes, US$12.7bn Trade
- Tata Motors (TTMT IN) Demerger: Interesting Index Implications
- HSCI Index Rebalance Preview: Potential Inclusions in December
- Advantest (6857 JP): Rally Leads to Potential NKY Capping
- Vietnam: Global Index Inclusion & Passive Flows
- Alibaba Drops 8%: What Friday’s U.S. Sell-Off Means for Hong Kong Stocks
- Market Sell-Off (Oct 10): How Asian Index ETFs Responded to Market Slide
- ReNew Energy Global (RNW US): Decision Time On NBIO
- Weekly Deals Digest (12 Oct) – Hang Seng Bank, Soft99, Toyota Industries, Infomedia, Tekscend
Chery Auto (9973 HK) IPO: No Inclusion in Global Indices; HSTECH Is Interesting
- Chery Automobile Co. Ltd. (9973 HK)‘s IPO range is HK$27.75-HK$30.75/share and will raise up to HK$10bn (US$1.3m) if the oversubscription option is exercised, valuing the company at HK$169bn (US$21.7bn).
- The stock should be added to the HSCI Index in December and that will make the stock eligible for inclusion in Southbound Stock Connect.
- There will be no inclusion in global indexes for the next year, but there is a possibility of inclusion in the Hang Seng TECH Index (HSTECH INDEX) in December.
Gold Miners ETF (GDX US): Benchmark Change; 8 Adds, 24 Deletes, US$12.7bn Trade
- There is 1 add for the MarketVector Global Gold Miners Index but the VanEck Gold Miners ETF will buy 8 stocks and sell 24 stocks due to a benchmark change.
- Estimated one-way turnover is 26.8% and the round-trip trade for the ETF is US$12.7bn. There are 23 stocks with over 5x ADV to trade.
- The ETF adds have underperformed the ETF sells in the last month, but a basket of ETF upweights has outperformed a basket of ETF downweights.
Tata Motors (TTMT IN) Demerger: Interesting Index Implications
- Tata Motors (TTMT IN) is demerging the company into two separate listed entities that will focus on the Passenger Vehicle business and the Commercial Vehicle businesses.
- Based on the estimated valuation for the two entities, both stocks will continue to remain in the MGlobal Index and the FGlobal Index.
- NIFTY and SENSEX trackers will need to sell their Commercial Vehicle business holdings soon after listing. There could be selling in the Passenger Vehicle business holdings at a later rebalance.
HSCI Index Rebalance Preview: Potential Inclusions in December
- In a pick-up in primary market activity, there have been 25 new listings on the Main Board of the HKEX (388 HK) in Q3.
- Zijin Gold (2259 HK) will be added to the HSCI after market close on 15 October and should be added to Southbound Stock Connect from the open on 27 October.
- There could be 4 (maybe 5) additions to the HSCI Index in December and 3 of those stocks will be added to Southbound Stock Connect from the open 8 December.
Advantest (6857 JP): Rally Leads to Potential NKY Capping
- Advantest Corp (6857 JP)‘s weight in the Nikkei 225 (NKY INDEX) has crossed 10% and staying there will lead to capping at the March rebalance.
- A lot of Advantest Corp (6857 JP)‘s float is held by passive trackers, and the real float is much lower. The capping will increase that float significantly.
- Advantest Corp (6857 JP) has outperformed its peers significantly and trades at higher valuation metrics compared to its peers.
Vietnam: Global Index Inclusion & Passive Flows
- After years of being on the watchlist, Vietnam will be added to a global index in September 2026 as long as progress is made on one key issue.
- The final decision will be made in March 2026, and the implementation of the inclusion will take place in phases.
- We currently see 21 stocks meeting the inclusion criteria. There are others that are close to the inclusion thresholds, and the list will change over the next few months.
Alibaba Drops 8%: What Friday’s U.S. Sell-Off Means for Hong Kong Stocks
- Context: Friday’s sell-off occurred after the Hong Kong market closed, but several Hong Kong–listed companies were caught up in the rout through their U.S.-listed ADRs.
- This Insight details the impact on 15 prominent Hang Seng Index constituents — including Alibaba, Tencent, and HSBC. Implied volatility in U.S.-traded options on these ADRs moved sharply in response.
- Why Read: Understand what to expect when the Hong Kong market reopens after the weekend — both in terms of price performance and implied volatility.
Market Sell-Off (Oct 10): How Asian Index ETFs Responded to Market Slide
- A renewed tariff threat from Trump sparked a sharp, sell-off across North American Equity markets.
- The sell off was broad based and accordingly we look at the performance of Asian Index ETF’s that trade in North America to help prepare for Monday’s price action.
- Implied volatility, price and option volume are displayed for each symbol.
ReNew Energy Global (RNW US): Decision Time On NBIO
- Back on the 10th December 2024, ReNew Energy Global (RNW US), an Indian renewable energy play, announced a non-binding Offer of US$7.07/share, by way of a Scheme.
- The bidding consortium, comprising (mainly) pre-IPO investors CPP, ADIA, Abu Dhabi Future Energy, and founder Sumant Sinha, collectively holding 64%. Non-binding terms were bumped to US$8/share on the 3rd July.
- ReNew’s Special Committee will provide “public comment regarding these matters at such time as there is a material development in the process, and by no later than 30 September 2025“.
Weekly Deals Digest (12 Oct) – Hang Seng Bank, Soft99, Toyota Industries, Infomedia, Tekscend
- A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
- ECM developments: FineToday Holdings (420A JP), Tekscend Photomask (429A JP), Tata Capital Limited (TATACAP IN), LG Electronics India (123D IN), JST Group (1703609D CH) IPOs.
- Event-Driven developments: Hang Seng Bank (11 HK), Shengjing Bank Co Ltd H (2066 HK), Soft99 Corp (4464 JP), Toyota Industries (6201 JP), Infomedia Ltd (IFM AU).
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