In today’s briefing:
- Gold Miners ETF (GDX US): Benchmark Change; 8 Adds, 24 Deletes, US$12.7bn Trade
- Zijin Mining (2899 HK): This Is A Short
- Chery Auto (9973 HK) IPO: No Inclusion in Global Indices; HSTECH Is Interesting
- Zijin Gold (2259 HK) IPO: HSCI Fast Entry; Quick Stock Connect Add; Global Indices Entry in 2026
- [Japan M&A/Activism] The Nagging Little Detail In the Soft99 MBO Extension Target Doc
- Jinke Smart (9666 HK): Boyu’s Offer Now Unconditional
- Quiddity Leaderboard STAR 50/100 Dec25: >US$2bn Combined One-Way Flows; Exp DELs Vs Peers Pair Ideas
- Another Passive Flow Trading Target Identified: Sejin Heavy in the Dec Shipbuilding ETF Rebal
- The 2025 Japan September-End Rebal and Dividend Trade
- Zijin Gold IPO (2259 HK): Valuation Insights
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.
Zijin Mining (2899 HK): This Is A Short
- In my June note, Zijin Mining Group (2899 HK) appeared fully valued; but I (thankfully) stopped short of being outright bearish. Its share price is up 48% since!
- A basket of peers is also up 37% since that note. Gold is up~8%, and 41% YTD. On the 14th September, Zijin released Zijin Gold’s PHIP. 1H25 numbers were solid.
- However, Zijin Gold’s earnings are by no stretch an outlier. Zijin’s Mining’s current share price is now baking in exceptional (unrealistic?) metrics for the gold play spin-off.
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.
Zijin Gold (2259 HK) IPO: HSCI Fast Entry; Quick Stock Connect Add; Global Indices Entry in 2026
- Zijin Gold (2259 HK) is looking to raise up to HK$28.7bn (US$3.7bn) in its IPO, valuing the company at HK$191.6bn (US$24.6bn).
- Zijin Mining (2899 HK) will hold between 85-86.7% of Zijin Gold and that will limit the free float of the stock. Half the IPO has been allotted to cornerstones.
- Zijin Gold could be added to the HSCI via Fast Entry and to Stock Connect in October. Global index inclusion should take place in the first half of 2026.
[Japan M&A/Activism] The Nagging Little Detail In the Soft99 MBO Extension Target Doc
- Yesterday, Soft99 Corp (4464 JP) announced a slight change in its “Target Opinion Document” after the MBO Bidco extended its TOB by 8 days the day before.
- The detail was not in the MBO Bidco extension. It was just revealed in an added note on p3 of the Target Opinion.
- That details matters A LOT to people looking at the Effissimo Overbid. The company’s Board has some serious work ahead.
Jinke Smart (9666 HK): Boyu’s Offer Now Unconditional
- Back on the 28th April 2025, PRC-incorporated property management play Jinke Smart Services (9666 HK) announced a possible unconditional MGO take-under at HK$6.67/share.
- The Boyu-backed Offeror and Concert Parties holding 37.86% (at the time), bought Jinke Property (000656 CH)‘s 18.05% stake at auction on the 30th March, triggering an unconditional MGO (once completed).
- The “Auction Transfer” was subject to CSDC oversight, which has now been satisfied/completed. The Composite Doc is expected to be dispatched on or before the 26th September.
Quiddity Leaderboard STAR 50/100 Dec25: >US$2bn Combined One-Way Flows; Exp DELs Vs Peers Pair Ideas
- STAR 50 Index is a tech-focused, blue-chip index in Mainland China which tracks the top 50 largest and most liquid names in the STAR market of the Shanghai Stock Exchange.
- STAR 100 index tracks the next 100 names (51st-150th ranks) and it represents the mid-cap segment of the STAR market.
- In this insight, we take a look at the potential ADDs/DELs for the STAR 50 and STAR 100 indices for the December 2025 index rebal event.
Another Passive Flow Trading Target Identified: Sejin Heavy in the Dec Shipbuilding ETF Rebal
- HHI–Mipo merger overlaps Dec review: Mipo dropped Nov 26, desk holds cash, rebal Dec 12, new HHI shares list Dec 15 but capped at 10%.
- No ad-hoc replacement for Mipo Nov 26; Dec review will add a new name, likely Sejin Heavy (075580 KS), with no other significant flows flagged.
- Sejin Heavy’s recent post-rally volume cools; passive inflow ~1.5x DTV may trigger visible price action, with potential front-running 1–2 days ahead of Dec 12 ETF rebal.
The 2025 Japan September-End Rebal and Dividend Trade
- Every year it’s the same trade. But sometimes it is not. This year it is Friday and Monday. Or not. Historically, the day before ex-date and ex-date see outright performance.
- The month-end and quarter-end bring big flows, or not, depending on how things have gone. This year they have gone well for equities, so odds are flows are smaller.
- Over the past 10 years or so, the two-day return on the March trade is pretty good. The September trade appears to be more mixed.
Zijin Gold IPO (2259 HK): Valuation Insights
- Zijin Gold (2259 HK) is a global leading gold mining company and the overseas gold segment of Zijin Mining Group (601899 CH). It has launched an HKEx IPO to raise US$3.2bn.
- I previously discussed the IPO in Zijin Gold IPO: The Investment Case and Zijin Gold IPO: PHIP Updates Support the Investment Thesis.
- In this note, I present my forecasts and valuation. My analysis suggests that the IPO price range is attractive.
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