In today’s briefing:
- Nikkei 225 Index Rebalance: 🚨Ibiden (4062 JP) To Replace Nidec (6594 JP) 🚨
- [Japan Special] Ibiden (4062) Replaces Nidec (6594) In Nikkei 225 on Accounting – A VERY BIG DEAL
- [Japan Offering] Kasumigaseki Capital (3498 JP) – BIG Primary for Big Plans
- IDX30/LQ45/IDX80 Index Rebalance: Plenty of Change with 4 Days to Trade
- Nikkei 225 (NKY) Outlook After Surprise Nov 5 Rebalance
- Taiwan Dual-Listings Monitor: TSMC Near Fresh Spread Short Level; ChipMOS Rare Discount
- A Special Cross Asset Morning Update: Nidec, Ibiden, and BoJ This Week
- Digital Holdings (2389 JP): SilverCape’s Hostile Competing Bid Is Met with Countermeasures
- AUB Group (AUB AU): EQT’s NBIO at A$45.00
- Introducing the Unusual Policy Narrative Now Pushed: Korea–Japan Economic Integration
Nikkei 225 Index Rebalance: 🚨Ibiden (4062 JP) To Replace Nidec (6594 JP) 🚨
- The JPX has designated Nidec Corp (6594 JP) as a ‘Security on Special Alert’ due to a disclaimer of opinion in the annual report (among other issues).
- Nikkei has announced the deletion of Nidec Corp (6594 JP) from the Nikkei 225 (NKY INDEX). Ibiden Co Ltd (4062 JP) will be added to the index.
- Nidec Corp (6594 JP) should also be deleted from the TSE Tokyo Price Index TOPIX (TPX INDEX). Both index deletions should take the stock a lot lower from here.
[Japan Special] Ibiden (4062) Replaces Nidec (6594) In Nikkei 225 on Accounting – A VERY BIG DEAL
- In June, Nidec Corp (6594 JP) announced they would delay the release of their yuho for three months because of an internal investigation into NIDEC FIR INTERNATIONAL (Italy).
- In September they launched a special committee. Shares fell 22%. Last Thursday, the company cancelled its interim dividend. Today, the JPX designated Nidec as Security on Special Alert.
- This is a VERY BIG DEAL. Nikkei225 deletes Nidec 5-Nov-2025, replaced by Ibiden Co Ltd (4062 JP) (PAF 1.0x). Designation also triggers TOPIX deletion for Nidec, likely on 30 October.
[Japan Offering] Kasumigaseki Capital (3498 JP) – BIG Primary for Big Plans
- On Friday, Kasumigaseki Capital (3498 JP) announced Aug-25 earnings and a combination ¥45-50bn primary+secondary offering worth 5.3mm shares, 6x ADV, and a float increase of 37%. Shares fell 15% today.
- 2yrs ago they did a large offering. It went well. They’d had a ridiculous plan to grow OP 6x from ¥3.5bn to ¥20bn in 2yrs to Aug-26. Then by Aug-25.
- They got to ¥8.5bn in Aug-24 and now ¥18.9bn in Aug-25 and now guide to ¥26.5bn in Aug-26 (the original plan having been ¥20bn).
IDX30/LQ45/IDX80 Index Rebalance: Plenty of Change with 4 Days to Trade
- There are 2 constituent changes for the IDX30 Index, 5 changes for the LQ45 Index, and 7 changes for IDX80 Index to be implemented at the close on 31 October.
- The largest passive flows are expected in Dian Swastatika Sentosa, Bank Central Asia, Bank Mandiri, Emtek, Bumi Resources, Bank Syariah Indonesia, XLSMART Telecom Sejahtera and Medikaloka Hermina.
- With only 4 days to implementation, there could be relatively big moves on stocks that have large flow/impact from passive fund trading.
Nikkei 225 (NKY) Outlook After Surprise Nov 5 Rebalance
- As reported by Brian Freitas, the JPX on Oct 27 suddenly announced that Nidec Corp (6594 JP) would be deleted from the Nikkei 225 and replaced by Ibiden (4062 JP).
- The date of replacement is November 5, the Nikkei will experience passive flows, in this insight we want to have a look at the possible moves caused by this catalyst.
- At the moment the index is overbought, according to our models.
Taiwan Dual-Listings Monitor: TSMC Near Fresh Spread Short Level; ChipMOS Rare Discount
- TSMC: +23.4% Premium; Near Levels to Open Fresh ADR Spread Short
- ASE: +0.3% Premium; Good Level to Long the ADR Spread
- ChipMOS: -7.5% Discount; Local Shares Rally Makes ADR Deeply Discounted
A Special Cross Asset Morning Update: Nidec, Ibiden, and BoJ This Week
- Japanese markets are seeing significant developments, including Nikkei 225 rebalancing with Nidec’s removal due to alert and Ibiden’s addition, impacting tracking funds, delta one trading strategies, and investors with position.
- The BoJ’s cautious normalization path continues to shape the JGB curve, with a notable steepening in the long end affecting asset-liability management.
- We detail the trades and execution of the trade idea, which may require special attention this week especially on the rebalance.
Digital Holdings (2389 JP): SilverCape’s Hostile Competing Bid Is Met with Countermeasures
- The Digital Holdings Inc (2389 JP) Board has responded to SilverCape’s hostile offer by proposing countermeasures ostensibly to protect the interests of minorities.
- The precedent Makino countermeasures against Nidec’s hostile offer were intended to buy time for a higher white-knight offer. In this case, it is being done to facilitate a lower offer.
- The countermeasures will severely dent SilverCape’s chances of succeeding. Hakuhodo Dy Holdings (2433 JP)’s irrevocables and insiders should be sufficient to pass the shareholder vote to implement the countermeasures.
AUB Group (AUB AU): EQT’s NBIO at A$45.00
- In response to an AFR article, AUB Group Limited (AUB AU) confirmed that on 26 September, it received a non-binding proposal from EQT (EQT SS) at A$45.00.
- While the offer represents an all-time high, it is arguably light compared to precedent transactions and peer multiples. EQT’s history of unsuccessful ASX tilts warrants some caution.
- The Board has granted a six-week exclusive due diligence period, which ends on 20 November. The shareholder structure reduces the vote risk.
Introducing the Unusual Policy Narrative Now Pushed: Korea–Japan Economic Integration
- Chey Tae‑won’s Korea–Japan integration push is fresh tape—unpriced and unconsumed—unlike the exhausted dividend tax story, making it the real policy‑momentum trade to watch.
- Korea’s export model is fading, but a $6T Korea–Japan bloc plus CPTPP buzz offers a fresh policy‑momentum catalyst, with AI/data angles luring incremental global flows.
- Korea–Japan cooperation isn’t a real bloc yet, but it trades like a policy theme—Chey’s 3PRO push makes it a headline‑driven short‑term play ripe for desks.
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