Korea / Special Situations, Clepsydra Capital

Sanghyun Park

I investigate special situations in Korea.

Korea / Special Situations

Lotte Holdings: Another Hanjin Kal Story?

Lotte Holdings Stub Trade on Owner's Suspended Jail Term

Lotte Holdings Controlling Stake Battle Dynamics: Short Holdings

The Market Is Overreacting to Lotte's Inheritance Situation: Creating an Opening for a Short

The Fate of Lotte Group Companies Post Shin Kyuk-Ho Era

2020 High Conviction: Lotte Shopping - A Big Mgmt Shakeup & Restructuring

Event-Driven

Lotte Holdings is a pure holding company. It is currently at a 47.1% discount to its NAV.<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/125/397/original/1.png?1585515426" class="editor-image img-responsive" data-smartkarma-image-id="125397"></figure>It's pretty much a two-sub synthetic stub. Lotte Chemical takes 63.5%, whereas Lotte Shopping features 36.5%.<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/125/398/original/5.png?1585515580" class="editor-image img-responsive" data-smartkarma-image-id="125398"></figure>The liquidity situation isn't too bad. The DTV of the holding company is more than US$5M. Both Chemical and Shopping are very liquid at US$30M and US$14M, respectively. Also, both Chemical and Shopping carry single stock futures.<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/125/399/original/4.png?1585515752" class="editor-image img-responsive" data-smartkarma-image-id="125399"></figure><hr>Where is the holding company relative to the two significant subsidiaries? They are now at -2σ on a 20D MA. The current price ratio is at a 120D low. <figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/125/395/original/2.png?1585515375" class="editor-image img-responsive" data-smartkarma-image-id="125395"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/125/400/original/chart%20%281%29.png?1585516206" class="editor-image img-responsive" data-smartkarma-image-id="125400"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/125/401/original/3.png?1585516488" class="editor-image img-responsive" data-smartkarma-image-id="125401"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/125/402/original/chart.png?1585516522" class="editor-image img-responsive" data-smartkarma-image-id="125402"></figure>

Lotte Holdings is a pure holding company. It is currently at a 47.1% discount to its NAV.It's pretty much a two-sub synthetic stub. Lotte Chemical takes 63.5%, whereas Lotte Shopping features 36.5%.The liquidity situation isn't too bad. The DTV of the holding company is more than US$5M. Both Chemical and Shopping are very liquid at US$30M and US$14M, respectively. Also, both Chemical and Shopping carry single stock futures.Where is the holding company relative to the two significant subsidiaries? They are now at -2σ on a 20D MA. The current price ratio is at a 120D low. 

Lotte Now Gives the Opportunity of a Stub Trade

LOTTE Corporation

Lotte Now Gives the Opportunity of a Stub Trade