In today’s briefing:
- Gold Miners ETF (GDX US): Further Capping Pushes Trade to Over US$12.5bn
- NIO (9866 HK/NIO US): Index Implications of US$1bn+ Offering
- [Japan ECM] Toei Animation (4816) Not as Interesting An Offering As It Could Have Been
- Quiddity Leaderboard HSTECH Dec25: One Index Change Likely; US$650mn One-Way with Capping
- [Japan M&A] Mandom (4917 JP) MBO – Light Price, Open-Ish Register, Tough to Take Over, Could Do Fun
- BoE QT: Pruning A Bad Policy
- Quiddity Leaderboard HSCEI Dec25: Three ADDs/DELs Likely; Sector-Neutral Idea
- Evergrande Property Services (6666 HK): Offer Expected As Parent (Likely) Exits
- Jilin Jiutai Bank (6122 HK): Take The Offer. It Is What It Is
- Zijin Mining: Gold IPO De-Risks, Copper Upside Remains
Gold Miners ETF (GDX US): Further Capping Pushes Trade to Over US$12.5bn
- The VanEck Gold Miners ETF/USA (GDX US) will change benchmark from the NYSE Arca Gold Miners Index to the MarketVector Global Gold Miners Index at the close on 19 September.
- The differences in the constituents between the two indices should result in 8 adds and 25 deletes. Estimated one-way turnover is 27.4% resulting in a round-trip trade of US$12.5bn.
- The forecast adds have continued to underperform the forecast deletes as the big valuation gap that had opened up since the announcement of the benchmark switch narrows.
NIO (9866 HK/NIO US): Index Implications of US$1bn+ Offering
- NIO (9866 HK) / NIO (NIO US) is looking to raise up to US$1.15bn, including the overallotment option, in an equity offering across Hong Kong and the U.S.
- The HK offering is priced at HK$43.36/share and the ADR pricing is US$5.57/share. NIO (NIO US) closed at US$5.72/share overnight, so expect NIO (9866 HK) to open around HK$44.55/share.
- There will be buying from global index trackers at the time of settlement of the offering shares. The buying from Hang Seng TECH Index (HSTECH INDEX) trackers is more nuanced.
[Japan ECM] Toei Animation (4816) Not as Interesting An Offering As It Could Have Been
- In Feb 2024, I wrote Toei Animation (4816 JP) – This Offering Could Be Heavy; the NEXT Offering Is More Interesting.
- Today, the company announced another offering where Fuji Media Holdings (4676 JP) is selling 10.575mm shares in an overseas offering priced likely tomorrow.
- It is not as interesting as I had expected. But it means the NEXT offering could be more interesting. But there is index buying long-term anyway.
Quiddity Leaderboard HSTECH Dec25: One Index Change Likely; US$650mn One-Way with Capping
- The HSTECH Index tracks the performance of the top 30 technology companies listed in Hong Kong that have high business exposure to certain technology themes.
- In this insight, we take a look at the potential index changes and the resultant capping flows for HSTECH index rebal event in December 2025.
- We expect one index change for the HSTECH index in December 2025 based on the latest available data.
[Japan M&A] Mandom (4917 JP) MBO – Light Price, Open-Ish Register, Tough to Take Over, Could Do Fun
- On 10 September, the founding Nishimura family, the PE Firm CVC, and Mandom Corp (4917 JP) agreed that the first two could take over the latter at 4.9x Mar28 EBITDA.
- A cocktail napkin calculation of expected leverage suggests the equity check is buying this at 5x average Mar27-28 free cash flow. That’s cheap for a growing company.
- The register is open enough to cause problems but not open enough to allow a clean hostile bid by a strategic. But still open enough for someone to have fun.
BoE QT: Pruning A Bad Policy
- The BoE’s annual Quantitative Tightening announcement in September should see it prune the targeted size, we expect by £20bn to £80bn, concentrated in the long-end.
- Fewer maturities in the year ahead would otherwise put too much pressure on active sales into a market that lacks appetite, especially with LDI demand disappearing.
- Pruning the size and duration delays costs crystallising by several billion a year, which the Chancellor will welcome, yet QT’s poor design remains an expensive fiscal disaster.
Quiddity Leaderboard HSCEI Dec25: Three ADDs/DELs Likely; Sector-Neutral Idea
- The HSCEI serves as a benchmark to reflect the overall performance of the top 50 “Mainland China” securities listed in Hong Kong.
- In this insight, we take a look at the rankings of potential ADDs and potential DELs for the December 2025 index rebal event.
- At present, we see three changes based on the latest data but the rankings can change until 30th September 2025.
Evergrande Property Services (6666 HK): Offer Expected As Parent (Likely) Exits
- Property management play Evergrande Property Services (6666 HK) (EPS) is currently suspended pursuant to the Takeovers Code.
- Evergrande (3333 HK) controls 51.71%. This suspension is either a precursor to a Scheme; or (more likely) cash-strapped Evergrande is exiting, potentially triggering an unconditional MGO.
- Evergrande, currently in liquidation, was delisted from the HKEx on the 25th August 2025 after failing to fulfil HKEx resumption guidance. The delisting was arguably symbolic, but remains a milestone.
Jilin Jiutai Bank (6122 HK): Take The Offer. It Is What It Is
- Back on the 3rd July 2025, Jilin Province Trust must a voluntary Offer at HK$0.70/share (~0.23x P/B!!) for troubled rural commercial bank Jilin Jiutai Rural Comm Bank (6122 HK).
- Shares have been suspended since 12th March. Jilin Jiutai have yet to publish their 2024 annual results. It’s doubtful shares will resume trading. Ever.
- The Composite Doc Booklet is now out, with a H-share class meeting on the 24th October, the same day as the first close. The IFA (Gram) says “fair & reasonable“.
Zijin Mining: Gold IPO De-Risks, Copper Upside Remains
- Dilution: The gold IPO trims attributable EBITDA by ~3% as minority interests rise.
- Parent Impact: Zijin parent emerges leaner, with net debt falling by US$4bn and copper now ~70% of EBITDA.
- Valuation: At ~7× EV/EBITDA, the stock offers 15–30% upside on our estimates, stretching to 25–45% at spot.
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