Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Event-Driven

Hitachi Energy India Limited manufactures electrical equipment.

<ul>
<li>With the review period nearing completion, there could be 14/15 changes for the NIFTY Midcap 150 Index at the September rebalance.</li>
<li>Estimated one-way turnover is 8.2% resulting in a one-way trade of INR 6.6bn (US$79m). With US$38bn tracking the index actively, the impact on the stocks will be much larger.</li>
<li>Performance of a long adds/short deletes trade was very good in March, and we could see a repeat over the next couple of months.</li>
</ul>


With the review period nearing completion, there could be 14/15 changes for the NIFTY Midcap 150 Index at the September rebalance.
Estimated one-way turnover is 8.2% resulting in a one-way trade of INR 6.6bn (US$79m). With US$38bn tracking the index actively, the impact on the stocks will be much larger.
Performance of a long adds/short deletes trade was very good in March, and we could see a repeat over the next couple of months.


NIFTY MIDCAP150 Index Rebalance Preview: 14 Changes & Good Performance as Actives Start Trading

Kokusai Electric Corporation manufactures and distributes semiconductor manufacturing systems. The Company produces batch processing systems, single wafer processing systems, and other systems. Kokusai Electric also operates advanced thermal process technology development, training, and other businesses.

<ul>
<li>
<a href="https://www.smartkarma.com/entities/kokusai-electric-corp" target="_blank" data-smartkarma-citation="entities:40152:1" rel="noopener">Kokusai Electric (6525 JP)</a> could price their secondary offering after market close today. The stock is down 10.5% since the rumors of the placement began 7 trading sessions ago.</li>
<li>The <a href="https://www.smartkarma.com/entities/philadelphia-stock-exchange-semiconductor-index" target="_blank" data-smartkarma-citation="entities:32992:1" rel="noopener">Philadelphia Stock Exchange Semiconductor Index (SOX INDEX)</a> has been dropping over the last few days and is 8.6% lower over the last 8 trading days.</li>
<li>
<a href="https://www.smartkarma.com/entities/kokusai-electric-corp" target="_blank" data-smartkarma-citation="entities:40152:1" rel="noopener">Kokusai Electric (6525 JP)</a> has been trading higher on expectations of index inclusion in August, but that could move to November now.</li>
</ul>



Kokusai Electric (6525 JP) could price their secondary offering after market close today. The stock is down 10.5% since the rumors of the placement began 7 trading sessions ago.
The Philadelphia Stock Exchange Semiconductor Index (SOX INDEX) has been dropping over the last few days and is 8.6% lower over the last 8 trading days.

Kokusai Electric (6525 JP) has been trading higher on expectations of index inclusion in August, but that could move to November now.


Kokusai Electric (6525 JP): Placement Price Could Be Determined Today; Index Impact Could Be Delayed

Zip Co Limited provides point-of-sale credit and digital payment services. The Company offers retail finance solutions to small, medium, and enterprise businesses. Zip Co serves retail, education, health, and travel industries in Australia.

<ul>
<li>With all regulatory approvals received, the Scheme Meeting for <a href="https://www.smartkarma.com/entities/renesas-electronics-corp" target="_blank" data-smartkarma-citation="entities:15933:1" rel="noopener">Renesas Electronics (6723 JP)</a>' acquisition of <a href="https://www.smartkarma.com/entities/altium-ltd" target="_blank" data-smartkarma-citation="entities:18626:1" rel="noopener">Altium Ltd (ALU AU)</a> will take place on 12 July.</li>
<li>If approved at the Scheme Meeting and at the Second Court Hearing, <a href="https://www.smartkarma.com/entities/altium-ltd" target="_blank" data-smartkarma-citation="entities:18626:1" rel="noopener">Altium Ltd (ALU AU)</a> will stop trading from the close on 19 July.</li>
<li>The replacements for <a href="https://www.smartkarma.com/entities/altium-ltd" target="_blank" data-smartkarma-citation="entities:18626:1" rel="noopener">Altium Ltd (ALU AU)</a> in the ASX100/200 indices could be announced late this week with implementation at the close on 19 July.</li>
</ul>


With all regulatory approvals received, the Scheme Meeting for Renesas Electronics (6723 JP)' acquisition of Altium Ltd (ALU AU) will take place on 12 July.
If approved at the Scheme Meeting and at the Second Court Hearing, Altium Ltd (ALU AU) will stop trading from the close on 19 July.
The replacements for Altium Ltd (ALU AU) in the ASX100/200 indices could be announced late this week with implementation at the close on 19 July.


S&P/ASX 100/200 Index Adhoc Rebalance: Potential Replacements for Altium (ALU AU)

Advanced Info Service Public Company Limited is granted a 25-year concession expiring the year 2015 by the Telephone Organization of Thailand to provide cellular phone services.  The Company provides analog mobile phone services through the Nordic Mobile Telephone (NMT900) network, and digital phone services through the Global Systems for Mobile Communication (GSM) network.

<ul>
<li>In 2021, <a href="https://www.smartkarma.com/entities/gulf-energy-development-pcl" target="_blank" data-smartkarma-citation="entities:26038:1" rel="noopener">Gulf Energy Development (GULF TB)</a> made an offer to acquire all <a href="https://www.smartkarma.com/entities/intouch-holdings-pcl" target="_blank" data-smartkarma-citation="entities:17638:1" rel="noopener">Intouch Holdings (INTUCH TB)</a> shares at THB65/share. <a href="https://www.smartkarma.com/entities/singapore-telecommunications" target="_blank" data-smartkarma-citation="entities:20:1" rel="noopener">Singtel (ST SP)</a> did not tender their then 21% stake.</li>
<li>Now <a href="https://www.smartkarma.com/entities/gulf-energy-development-pcl" target="_blank" data-smartkarma-citation="entities:26038:1" rel="noopener">Gulf Energy Development (GULF)</a> and <a href="https://www.smartkarma.com/entities/intouch-holdings-pcl" target="_blank" data-smartkarma-citation="entities:17638:1" rel="noopener">Intouch Holdings (INTUCH)</a> are looking to merge and that will result in VTO's for <a href="https://www.smartkarma.com/entities/advanced-info-service-pcl" target="_blank" data-smartkarma-citation="entities:947:1" rel="noopener">Advanced Info Service (ADVANC TB)</a> and <a href="https://www.smartkarma.com/entities/thaicom-pcl" target="_blank" data-smartkarma-citation="entities:18019:1" rel="noopener">Thaicom Pcl (THCOM TB)</a>.</li>
<li>The merger will result in an inclusion to the <a href="https://www.smartkarma.com/entities/stock-exchange-of-thailand-set-50-index" target="_blank" data-smartkarma-citation="entities:31493:1" rel="noopener">SET 50 Index</a> in the first quarter of 2025. There is the December rebalance before that.</li>
</ul>


In 2021, Gulf Energy Development (GULF TB) made an offer to acquire all Intouch Holdings (INTUCH TB) shares at THB65/share. Singtel (ST SP) did not tender their then 21% stake.
Now Gulf Energy Development (GULF) and Intouch Holdings (INTUCH) are looking to merge and that will result in VTO's for Advanced Info Service (ADVANC TB) and Thaicom Pcl (THCOM TB).
The merger will result in an inclusion to the SET 50 Index in the first quarter of 2025. There is the December rebalance before that.


Hygeia is a China based oncology healthcare group.

<ul>
<li>There are a bunch of stocks listed in Hong Kong that have underperformed the <a href="https://www.smartkarma.com/entities/hang-seng-china-enterprises-index" target="_blank" data-smartkarma-citation="entities:22900:1" rel="noopener">HSCEI INDEX</a> and their peers and could be deleted from global passive portfolios in August.</li>
<li>The deletion from passive portfolios will lead to a liquidity event at the end of August where passive trackers will need to sell multiple days of ADV.</li>
<li>There has been a big jump in cumulative excess volume in some stocks and the A/H premium on a lot of the names has jumped over the last few months.</li>
</ul>


There are a bunch of stocks listed in Hong Kong that have underperformed the HSCEI INDEX and their peers and could be deleted from global passive portfolios in August.
The deletion from passive portfolios will lead to a liquidity event at the end of August where passive trackers will need to sell multiple days of ADV.
There has been a big jump in cumulative excess volume in some stocks and the A/H premium on a lot of the names has jumped over the last few months.


Hong Kong: Stocks Facing the Passive Boot in August

Periscope Analytics
Event-Driven Trades Across Asia Pacific

NIFTY MIDCAP150 Index Rebalance Preview: 14 Changes & Good Performance as Actives Start Trading

There could be 14/15 changes for the NIFTY Midcap150 Index in Sep. Apart from the passive trackers, there are huge active funds tracking the index....

Brian Freitas

Kokusai Electric (6525 JP): Placement Price Could Be Determined Today; Index Impact Could Be Delayed

The Kokusai Electric secondary offering price could be determined today. A drop in the SOX Index and the possibility of index inclusion being...

Brian Freitas

S&P/ASX 100/200 Index Adhoc Rebalance: Potential Replacements for Altium (ALU AU)

Passives will need to trade ZIP and TLX at the close today as part of the ad hoc rebalance triggered by Renesas acquiring Altium. ZIP and TLX have...

Brian Freitas

GULF/INTUCH Merger & ADVANC/THCOM VTO's

GULF and INTUCH are looking to merge with the merger ratio very close to current levels. Shareholders are unlikely to tender into the ADVANC and...

Brian Freitas

Hong Kong: Stocks Facing the Passive Boot in August

We expect 7 HK listed stocks to be deleted from global passive portfolios in August. The stocks have underperformed the HSCEI and their peers as...

Brian Freitas