In today’s briefing:
- HSTECH Index Rebalance: Leapmotor (9863 HK) To Replace ASMPT (522 HK) As Trade Hits US$3.5bn
- HSCEI Index Rebalance: 3 Changes; Yum China In; Double Add for Innovent Bio
- UK Labour Party: Damned If They Do…
- Hang Seng Index (HSI) Rebalance: Innovent Biologics Turns a Profit, Gets Added
- Qube (QUB AU): Macquarie’s Lobs NBIO
- [Quiddity Index] Nikkei 225 Mar26 – Kioxia (285A) On the Menu, Others Not Far Behind
- Ruling Party Unveils Key Details of 3rd Commercial Act Amendment: Mandatory Treasury-Share Disposal
- Qube Holdings (QUB AU): Macquarie’s NBIO at A$5.20
- A Tender Offer of 10% Stake in Gabia by Align Partners Asset Management
- SNT Group – Formalizes a Hostile Takeover of SMEC
HSTECH Index Rebalance: Leapmotor (9863 HK) To Replace ASMPT (522 HK) As Trade Hits US$3.5bn
- As expected, Zhejiang Leapmotor Technologie (9863 HK) will replace ASM Pacific Technology (522 HK) in the Hang Seng TECH Index (HSTECH INDEX) at the December rebalance.
- Estimated one-way turnover is 4.7% and that results in a round-trip trade of HK$27.5bn (US$3.5bn). There is between 8.7-9.8 days of ADV to trade in the two stocks.
- Capping and float changes results in chunky flows to some other stocks and there could be big price moves over the next week.
HSCEI Index Rebalance: 3 Changes; Yum China In; Double Add for Innovent Bio
- China Hongqiao, Innovent Biologics and Yum China replace ENN Energy, Haidilao International and New Oriental Education in the Hang Seng China Enterprises Index (HSCEI INDEX) in December. All changes are in line.
- Estimated one-way turnover at the rebalance is 4.6% resulting in a round-trip trade of HK$6.3bn (US$811m). The final capping will use the close of trading on 2 December.
- Innovent Biologics is also an add to the Hang Seng Index (HSI INDEX). The passive buying will absorb some stock from the recent placement in China Hongqiao.
UK Labour Party: Damned If They Do…
- Whatever Rachel Reeves comes up with in her 26 November budget, she is bound to run into criticism from within her own parliamentary party.
- Bond markets seem set to react badly to this, especially if it seems likely that her overall objectives will be undermined by internal resistance to proposed measures.
- She and the PM will probably survive this, but a market-unsettling change and slide to the left look increasingly likely by mid-2026, followed by defeat at the next election.
Hang Seng Index (HSI) Rebalance: Innovent Biologics Turns a Profit, Gets Added
- Following two periods of profitability, Innovent Biologics Inc (1801 HK) will be added to the Hang Seng Index (HSI INDEX) at the close on 5 December.
- Innovent Biologics Inc (1801 HK) is also an add to the Hang Seng China Enterprises Index (HSCEI INDEX) in December, so this inclusion increases the flow and impact.
- Estimated one-way turnover is 2.3% and the estimated round-trip trade is HK$9.2bn (US$1.2bn). Big capping outflows for Alibaba (9988 HK) at the December rebalance.
Qube (QUB AU): Macquarie’s Lobs NBIO
- Qube Holdings (QUB AU), a logistics and infrastructure play, has announced a A$5.20/share non-binding indicative Offer from Macquarie Asset Management, a unit of Macquarie Group (MQG AU).
- That is a 27.8% premium to last close. And ~14.4x FY25 EV/EBITDA. The proposal “follows an earlier unsolicited, non-=binding and indicative offer at lower value.” Dividends paid will be netted.
- Qube directors are supportive. The proposal is conditional on due diligence, board approvals, no MACs at Qube, plus regulatory clearance, including FIRB and ACCC signing off.
[Quiddity Index] Nikkei 225 Mar26 – Kioxia (285A) On the Menu, Others Not Far Behind
- The March 2026 review for the Nikkei 225 is turning out to be a little more interesting than one might have expected a few months ago.
- As of the end of August, the 3mo ADTV for Kioxia (285A) was ¥18bn despite expectations it would go into M _ _ _. The 1mo average today? ¥383bn.
- That means it has rapidly climbed into the top echelons of 5yr trading history. Importantly, JX Advanced Metals (5016 JP) and Kokusai Electric (6525 JP) are not far behind.
Ruling Party Unveils Key Details of 3rd Commercial Act Amendment: Mandatory Treasury-Share Disposal
- The proposed bill fully closes the treasury-share loopholes, bans all exchangeable/pledge uses, blocks M&A allocations, and imposes strict cancellation deadlines—1 year for new buys, 6 months for existing.
- The amendment tightens disposal rules: no cancellation means pro-rata sales to existing shareholders only, shutting down selective deals and closing the wide-open disposal gap under current law.
- The proposal is far tougher than expected, likely to become the final version, and should drive a near-term mandatory-cancel narrative and notable price action in governance-sensitive holding-co names.
Qube Holdings (QUB AU): Macquarie’s NBIO at A$5.20
- Qube Holdings (QUB AU) has received a non-binding proposal from Macquarie Asset Management (MAM) at A$5.20 per share, a 27.8% premium to the undisturbed price.
- The Board has granted exclusive due diligence until 1 February 2026 (or 15 February under certain circumstances). A scheme offer would be conditional on FIRB and ACCC approval.
- While the offer represents an all-time high, the scarcity value of high-quality infrastructure assets could spur a competing bid from others, such as Brookfield, which holds pre-emptive rights at Patrick.
A Tender Offer of 10% Stake in Gabia by Align Partners Asset Management
- After the market close on 24 November, it was announced that Align Partners is conducting a partial tender offer of a 10% stake in Gabia Inc (079940 KS).
- Tender offer price is 33,000 won (20% higher than current price). Tender offer amount is 44.7 billion won.
- If Align Partners successfully completes this tender offer, its stake would rise to 19.03%. Plus, the combined stakes of Align Partners and Miri Capital would be 42.99%.
SNT Group – Formalizes a Hostile Takeover of SMEC
- On 24 November, the SNT Group formalized its hostile takeover of Smec. S&T Holdings disclosed that it acquired an additional 5.46% stake in SMEC, raising its stake to 13.65%.
- S&T Holdings and SNT Group Chairman Choi combined own a 20.2% stake in SMEC. In comparison, the SMEC CEO Choi Young-seop owns a 9.75% stake in SMEC.
- In our view, this is likely to lead to a potential fight for the control of SMEC’s management rights, pushing up the share price of SMEC even further.
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