In today’s briefing:
- Dongfeng (489 HK): Questioning The EV Listing Valuation
- A/H Premium Tracker (To 5 Sep 2025): AH Premia Contract Slightly, Beautiful Skew Better
- Ecopro Co: Pursuing a PRS Deal Worth About 700 Billion Won Using Its Stake in Ecopro BM
- Nidec: Navigating Regulatory Challenges and Unlocking Value
- Timing and Hedge Play on Korea’s Top Policy Swing—CGT Applicable Threshold
- Assura Thing: PHP’s Clean-Up Basis into October
Dongfeng (489 HK): Questioning The EV Listing Valuation
- Back on the 22nd August, SOE-backed Dongfeng Motor (489 HK) announced a privatisation; together with a concurrent listing of its EV arm, VOYAH.
- The share price closed up 54% on the first day, ~15% adrift of the independently valued cash + scrip (into VOYAH) under the privatisation.
- Shares have pared back 5% since. VOYAH’s peer basket has fallen ~15% on average. The market is implying a price-to-trailing-sales of 1x for VOYAH versus the basket average of 1.9x.
A/H Premium Tracker (To 5 Sep 2025): AH Premia Contract Slightly, Beautiful Skew Better
- “Beautiful Skew” came back slightly. Not huge, but OK. On average, liquid Hs outperformed their As by 0.8%.
- Last week’s short reco on Remegen (9995 HK) gained 8.3% on the week in Hs and the H underperformed the A by 7% Friday to Friday, 4.5% if VWAPed Monday.
- AH premia are likely still in a widening phase but weakness in speculative A-shares may dampen overall moves even if pairs are volatile. New reco this week.
Ecopro Co: Pursuing a PRS Deal Worth About 700 Billion Won Using Its Stake in Ecopro BM
- Several local news outlets reported that Ecopro Co is pursuing a plan to raise about 700 billion won through a PRS agreement using its stake in Ecopro BM as collateral.
- Ecopro BM currently has a market cap of 11.4 trillion won. A PRS worth 700 billion won (assuming no change in share price), represents 6.1% of Ecopro BM’s market cap.
- Although Ecopro has not officially announced this PRS deal, we believe that this is a high probability (70%-80%+) that this deal will get done in the next several weeks.
Nidec: Navigating Regulatory Challenges and Unlocking Value
- Urgent Regulatory Deadline: Nidec faces a critical deadline of September 26, 2025. Meeting this deadline is crucial to avoid regulatory consequences, including potential “Security on Alert” designation or stock suspension.
- Underlying Strength Amidst Issues: Despite recent compliance issues that have impacted its stock, Nidec maintains a strong position as a global leader in electric motors with diversified revenue, projected growth.
- Potential for Rebound: The current low valuation, may present a buying opportunity for long-term investors if the company successfully addresses its governance issues and restores investor confidence.
Timing and Hedge Play on Korea’s Top Policy Swing—CGT Applicable Threshold
- Deputy PM Koo guided the threshold decision by month-end, likely before Chuseok; historically, Seoul drops major policy prints on Thu/Fri, pointing to 25–26 as the high-prob window.
- Local intel points to ₩5bn; strong public pushback makes it politically locked. Traders are positioning ahead of the 25–26 window, balancing index longs with hedges.
- FSS break-up creates regulatory uncertainty, pressuring banks and brokers. Traders appear to be pairing index longs with financials shorts, riding policy momentum while hedging sector risk.
Assura Thing: PHP’s Clean-Up Basis into October
- The deal has moved into its closing stretch, with process milestones largely secured. From here, this feels more like a basis clean-up than a binary event, with execution discipline paramount.
- Value now leans on PHP shares rather than regulatory drama. Hedging the stock leg frames the opportunity; avoiding complexity and timing slippage likely matters more than squeezing every basis point.
- Squeeze-Out is advancing; settlement expected in October as delisting completes. I recommend treating CMA headlines as background noise and keeping sizing disciplined.
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