In today’s briefing:
- Hygon/Sugon Merger: BIG Index Flows on Completion
- Gold Miners ETF (GDX US): Impact of Benchmark Change – Update
- Fresh Low-PBR Policy Color Hitting the Local Tape Today
- Gemlife (GLF AU): Index Inclusions Start Later This Year
- Toyota (7203 JP // TM US) Hits Oversold: Your High-Potential Options Strategy
- SingPost (SPOST SP): More Non-Core Divestments – Slowly But Surely
- Israel/Iran/US: Ten Pointers
- Contact Energy/Manawa Energy: Index Flows as Deal Nears Completion
- Greatland Resources (GGP AU): Big Index Inclusions for Recent IPO
- [Quiddity Index] S&P500/600 Sep25 Rebal: Multiple Intra-Review Changes Possible
Hygon/Sugon Merger: BIG Index Flows on Completion
- On 26 May, Hygon Information Technology (688041 CH) and Dawning Information Industry (603019 CH) announced a merger in a sign of consolidation in China’s chipmaking industry.
- For each share of Dawning held, shareholders will receive 0.5525 shares of Hygon. With uncertainty on the timeline for merger completion, Dawning is trading at a 10% discount.
- On completion of the merger, passive trackers will need to buy over US$1.1bn of Hygon Information Technology C (688041 CH) with nearly of that from local index trackers.
Gold Miners ETF (GDX US): Impact of Benchmark Change – Update
- The VanEck Gold Miners ETF/USA (GDX US) has announced a benchmark change from the NYSE Arca Gold Miners Index to the MarketVector Global Gold Miners Index.
- The benchmark change will result in a bunch of constituent and weight changes in September. Estimated one-way turnover is 16.5% resulting in a one-way trade of US$3.15bn.
- The flow and turnover numbers will change following constituent and capping changes for the MarketVector Global Gold Miners Index at the September rebalance.
Fresh Low-PBR Policy Color Hitting the Local Tape Today
- The ruling party’s KOSPI 5,000 task force is now eyeing low PBR names with talk of direct penalties — a sharper shift from the prior admin’s soft-touch value-up approach.
- Low PBR penalties may bypass the Assembly, fast-tracked via KRX or enforcement rule tweaks — rollout could follow swiftly post commercial code passage, possibly within 2–3 months.
- Market’s zeroing in on low PBR, high ROE large caps — with 0.8x flagged as the penalty line, 56 KRW 1T+ names screen as potential re-rating plays.
Gemlife (GLF AU): Index Inclusions Start Later This Year
- Gemlife (GLF AU) is looking to raise A$750m in a primary offering, valuing the company at A$1.58bn. The stock is expected to start trading on 3 July.
- The Puljich family and Thakral Corp (THK SP) are escrowed on their shares till mid 2026 at the earliest.
- Gemlife (GLF AU) could be added to global indexes in November and December this year, but S&P/ASX 300 Index inclusion could take place only in March 2026.
Toyota (7203 JP // TM US) Hits Oversold: Your High-Potential Options Strategy
- Context: After three consecutive down weeks, Toyota Motor (7203 JP) has entered oversold territory, triggering a potential upside signal in quantitative models.
- Trade Idea: With signs pointing to a short-term reversal, a Bull Call Spread strategy offers high return potential (~12x premium) with limited upfront cost.
- Why Read: This Insight presents a timely, actionable trade idea with a well-defined risk/reward profile—ideal for investors seeking tactical exposure. Details Provided.
SingPost (SPOST SP): More Non-Core Divestments – Slowly But Surely
- After selling its Aussie-based logistics ops earlier this year, Singapore Post (SPOST SP) continues to divest non-core assets and businesses.
- The latest is the sale and leaseback of 10 Housing & Development Board shophouses, which could net S$50mn.
- SPOST has declared a S$0.09/share special dividend from the Aussie sale. Shareholders will vote on the dividend at the AGM on the 23rd July.
Israel/Iran/US: Ten Pointers
- Recent events have highlighted the difficulty in predicting the progression of the Iran/Israel conflict.
- Despite this, the volatility caused by these headlines has not significantly impacted market perspectives.
- The supply/demand equation remains the primary influence on market thinking regarding oil.
Contact Energy/Manawa Energy: Index Flows as Deal Nears Completion
- Contact Energy (CEN NZ) is acquiring Manawa Energy Ltd (MNW NZ) for NZ$1.12/share in cash and 0.583 Contact Energy shares for each share of Manawa Energy.
- Manawa Energy (MNW NZ) is expected to stop trading after the close on 7 July. There will be passive inflows for Contact Energy (CEN NZ) due to increased index shares.
- As a replacement for Manawa Energy Ltd (MNW NZ), there will be an ad hoc inclusion to the S&P/NZX 50 Index at the close of 7 July.
Greatland Resources (GGP AU): Big Index Inclusions for Recent IPO
- Greatland Resources (GGP AU) started trading on the ASX Ltd (ASX AU) on 24 June after selling shares worth A$504m in a primary and secondary offering across Australia/UK.
- Greatland has a full market cap of A$4.9bn and a high free float since Greatland Gold Plc (GGP LN) was listed on the AIM market of the London Stock Exchange.
- Given the large market cap and high float, the stock could be added to multiple indices over the next few months.
[Quiddity Index] S&P500/600 Sep25 Rebal: Multiple Intra-Review Changes Possible
- The S&P 500 index tracks the 500 largest names listed in the US and it is one of the most highly-tracked indices in the world.
- In this insight, we take a look at the upcoming constituent changes in the run up to the September 2025 index rebal event.
- We expect two regular changes in September 2025. There are also multiple live M&A events which are likely to trigger intra-review index changes.
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