Korea / Special Sits, Pairs, Index Rebalancing, Clepsydra Capital

Sanghyun Park

Korea / Special Sits, Pairs, Index Rebalancing

Clepsydra Capital

Investigate special situations, pairs, and index rebalancing trades in Korea.

Equity Capital Markets

SK IE Technology   / Equity Capital Markets

<p>Tomorrow is SK IE Tech's market debut day.</p><p>The offering price of ₩105,000 gives a market cap of ₩7.48T. It is pretty much the same as the 50th largest market cap ordinary share: Hyundai Glovis having a market cap of ₩74.81T as of today.</p><p>The local market expects a "Double Crown" (a base price set at a +200% premium to the offering price and a further +30% premium to the base price for the closing price) for SK IE Tech on the IPO day. A likely 19.46T market cap will greet us right in the first trading session. Yes, it is comfortably above the threshold to make KOPSI 200 through a fast entry.</p><table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr>
<td data-sheets-value='{"1":2,"2":"Implied market cap"}'>Market cap</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Offering price"}'>Offering price</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"IPO day base price at a 200% premium to the offering price"}'>IPO day base price at a 200% premium to the offering price</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"IPO day close price at a 30% premium to the base price"}'>IPO day close price at a 30% premium to the base price</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Offering price"}'>Offering price</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"₩105,000"}'>₩105,000</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"₩210,000"}'>₩210,000</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"₩273,000"}'>₩273,000</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Implied market cap"}'><strong>Market cap</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"₩7.48T"}'><strong>₩7.48T</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"₩14.97T"}'><strong>₩14.97T</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"₩19.46T"}'><strong>₩19.46T</strong></td>
</tr>
<tr><td colspan="4" rowspan="1" data-sheets-value='{"1":2,"2":"Source: KRX"}'>Source: KRX</td></tr>
</tbody>
</table><p>Here is the condition for KOSPI 200 fast entry of a new listing:</p><ul>
<li>A newly listed stock in the top 50 common shares in the KOSPI market by market capitalization is subject to index inclusion. The company can be selected before rebalancing considering sectoral balance and liquidity. The market capitalization refers to the average daily market capitalization for 15 trading days from the listing day.</li>
<li>When selected for index inclusion, the newly listed stock replaces a company with the smallest market capitalization at the most recent rebalancing.</li>
</ul>

Tomorrow is SK IE Tech's market debut day.The offering price of ₩105,000 gives a market cap of ₩7.48T. It is pretty much the same as the 50th largest market cap ordinary share: Hyundai Glovis having a market cap of ₩74.81T as of today.The local market expects a "Double Crown" (a base price set at a +200% premium to the offering price and a further +30% premium to the base price for the closing price) for SK IE Tech on the IPO day. A likely 19.46T market cap will greet us right in the first trading session. Yes, it is comfortably above the threshold to make KOPSI 200 through a fast entry.








Market cap
Offering price
IPO day base price at a 200% premium to the offering price
IPO day close price at a 30% premium to the base price


Offering price
₩105,000
₩210,000
₩273,000


Market cap
₩7.48T
₩14.97T
₩19.46T

Source: KRX

Here is the condition for KOSPI 200 fast entry of a new listing:
A newly listed stock in the top 50 common shares in the KOSPI market by market capitalization is subject to index inclusion. The company can be selected before rebalancing considering sectoral balance and liquidity. The market capitalization refers to the average daily market capitalization for 15 trading days from the listing day.
When selected for index inclusion, the newly listed stock replaces a company with the smallest market capitalization at the most recent rebalancing.


SK IE Tech KOSPI 200 Fast Entry Month Issue: June or September?

Global Emerging Market Equities, Propitious Research

Wium Malan, CFA

Global Emerging Market Equities

Independent, Fundamental Quantitative Research

Propitious Research

Fully independent, fundamental and quantitative equity research, focused on companies in the Telecommunication, Media, Technology, Internet and Healthcare sectors in the Global Emerging Markets. Idea generation focused on Quality stocks, trading below their intrinsic Value, with sound Corporate Governance.

Thematic (Sector/Industry)

<p>This insight provides a summary of the key news developments impacting the largest countries and constituents of the Global Emerging Markets equity indices.  </p><p><strong><em>Companies mentioned this week:</em></strong></p><p><a href="https://www.smartkarma.com/entities/taiwan-semiconductor-manufacturing-company" target="_blank" data-smartkarma-citation="entities:11230:1" rel="noopener">TSMC (2330 TT)</a>, <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent (700 HK)</a>, <a href="https://www.smartkarma.com/entities/posco" target="_blank" data-smartkarma-citation="entities:208:1" rel="noopener">Posco (005490 KS)</a>, <a href="https://www.smartkarma.com/entities/china-mobile-ltd" target="_blank" data-smartkarma-citation="entities:27:1" rel="noopener">China Mobile (941 HK)</a>, <a href="https://www.smartkarma.com/entities/china-unicom-hong-kong-ltd" target="_blank" data-smartkarma-citation="entities:1016:1" rel="noopener">China Unicom Hong Kong (762 HK)</a>, <a href="https://www.smartkarma.com/entities/china-telecom-corp-ltd-h" target="_blank" data-smartkarma-citation="entities:1015:1" rel="noopener">China Telecom Corp Ltd (H) (728 HK)</a></p>

This insight provides a summary of the key news developments impacting the largest countries and constituents of the Global Emerging Markets equity indices.  Companies mentioned this week:TSMC (2330 TT), Tencent (700 HK), Posco (005490 KS), China Mobile (941 HK), China Unicom Hong Kong (762 HK), China Telecom Corp Ltd (H) (728 HK)

Global Emerging Markets Weekly: 7 May 2021

Event-Driven

<p>Korea has a total of 121 preferred shares.</p><div class="content-highlight"><p><strong>You can find all the preferred share names in Korea with the disparity to the ordinary shares and the sigma on a 20-day moving average in the attached file.</strong></p></div><hr><p>6 prefs in total have a market cap of more than ₩1T. The largest one is Samsung Electronics 1P featuring a market cap of ₩61.6T.</p><table class="table table-striped">
<colgroup>
<col width="200">
<col width="70">
<col width="70">
</colgroup>
<tbody>
<tr>
<td data-sheets-value='{"1":2,"2":"Pref"}'>Top 10 largest market cap prefs in Korea</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Ticker"}'>Ticker</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Market cap (₩B)"}'>Market cap (₩B)</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Samsung Electronics Co Ltd Preference Shares Non Voting"}'><strong>Samsung Electronics Co Ltd Preference Shares Non Voting</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"005935"}'><strong>005935</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":61551.92516}' data-sheets-numberformat='[null,2,"#,##0.0"]'><strong>61,551.9</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Hyundai Motor S2 Pref Shs"}'><strong>Hyundai Motor S2 Pref Shs</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"005387"}'><strong>005387</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":4049.885061}' data-sheets-numberformat='[null,2,"#,##0.0"]'><strong>4,049.9</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"LG Chem Ltd Preference Shares"}'><strong>LG Chem Ltd Preference Shares</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"051915"}'><strong>051915</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":3344.628}' data-sheets-numberformat='[null,2,"#,##0.0"]'><strong>3,344.6</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Hyundai Motor S1 Pref Shs"}'><strong>Hyundai Motor S1 Pref Shs</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"005385"}'><strong>005385</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":2752.305405}' data-sheets-numberformat='[null,2,"#,##0.0"]'><strong>2,752.3</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"LG Household &amp; Healthcare Ltd Preference Shares"}'><strong>LG Household &amp; Healthcare Ltd Preference Shares</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"051905"}'><strong>051905</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":1553.77578}' data-sheets-numberformat='[null,2,"#,##0.0"]'><strong>1,553.8</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"LG Electronics Inc. Preference Shares"}'><strong>LG Electronics Inc. Preference Shares</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"066575"}'><strong>066575</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":1254.577416}' data-sheets-numberformat='[null,2,"#,##0.0"]'><strong>1,254.6</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Amorepacific Corp Preference Shares"}'>Amorepacific Corp Preference Shares</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"090435"}'>090435</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":978.710841}' data-sheets-numberformat='[null,2,"#,##0.0"]'>978.7</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Samsung SDI Co Ltd Preferred Shares"}'>Samsung SDI Co Ltd Preferred Shares</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"006405"}'>006405</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":711.065292}' data-sheets-numberformat='[null,2,"#,##0.0"]'>711.1</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Mirae Asset Securities 2PB"}'>Mirae Asset Securities 2PB</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"00680K"}'>00680K</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":697.9}' data-sheets-numberformat='[null,2,"#,##0.0"]'>697.9</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Korea Investment Holdings Co., Ltd. Preference Shares"}'>Korea Investment Holdings Co., Ltd. Preference Shares</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"071055"}'>071055</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":521.384339}' data-sheets-numberformat='[null,2,"#,##0.0"]'>521.4</td>
</tr>
<tr><td colspan="3">Source: KRX</td></tr>
</tbody>
</table><p>These are the top 10 preferred shares having the widest disparity to the ordinary shares. Solus Advanced Materials 1P tops the list with a 66.87% disparity. 4 prefs in total are above a 60% disparity to their respective ordinary share. A total of 19 prefs have a +50% disparity to the ordinary shares.</p><table class="table table-striped">
<colgroup>
<col width="200">
<col width="70">
<col width="70">
</colgroup>
<tbody>
<tr>
<td data-sheets-value='{"1":2,"2":"Pref"}'>Top 10 prefs having the widest disparity to ordinary share in Korea</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Ticker"}'>Ticker</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Disparity to ordinary share"}'>Disparity to ordinary share</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Solus Advanced Materials 1P"}'><strong>Solus Advanced Materials 1P</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"33637K"}'><strong>33637K</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.668693009118541}' data-sheets-numberformat='[null,3,"0.00%",1]'><strong>66.87%</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Amorepacific Corp Preference Shares"}'><strong>Amorepacific Corp Preference Shares</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"090435"}'><strong>090435</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.6653429602888087}' data-sheets-numberformat='[null,3,"0.00%",1]'><strong>66.53%</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"AmoreG 1P Pref Shs"}'><strong>AmoreG 1P Pref Shs</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"002795"}'><strong>002795</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.6418918918918919}' data-sheets-numberformat='[null,3,"0.00%",1]'><strong>64.19%</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Doosan Fuel Cell 1P"}'><strong>Doosan Fuel Cell 1P</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"33626K"}'><strong>33626K</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.6262626262626263}' data-sheets-numberformat='[null,3,"0.00%",1]'><strong>62.63%</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Nexen Tire Corp Preference Shares"}'>Nexen Tire Corp Preference Shares</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"002355"}'>002355</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.5765124555160143}' data-sheets-numberformat='[null,3,"0.00%",1]'>57.65%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"BYC Co., Ltd Preference Shares"}'>BYC Co., Ltd Preference Shares</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"001465"}'>001465</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.5660621761658031}' data-sheets-numberformat='[null,3,"0.00%",1]'>56.61%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Doosan Fuel Cell 2PB"}'>Doosan Fuel Cell 2PB</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"33626L"}'>33626L</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.5391414141414141}' data-sheets-numberformat='[null,3,"0.00%",1]'>53.91%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Hyundai Motor S3 Pref Shs"}'>Hyundai Motor S3 Pref Shs</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"005389"}'>005389</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.5357142857142857}' data-sheets-numberformat='[null,3,"0.00%",1]'>53.57%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"LG Household &amp; Healthcare Ltd Preference Shares"}'>LG Household &amp; Healthcare Ltd Preference Shares</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"051905"}'>051905</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.5289624443029918}' data-sheets-numberformat='[null,3,"0.00%",1]'>52.90%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"LG Chem Ltd Preference Shares"}'>LG Chem Ltd Preference Shares</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"051915"}'>051915</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.5266594124047879}' data-sheets-numberformat='[null,3,"0.00%",1]'>52.67%</td>
</tr>
<tr><td colspan="3">Source: KRX</td></tr>
</tbody>
</table>

Korea has a total of 121 preferred shares.You can find all the preferred share names in Korea with the disparity to the ordinary shares and the sigma on a 20-day moving average in the attached file.6 prefs in total have a market cap of more than ₩1T. The largest one is Samsung Electronics 1P featuring a market cap of ₩61.6T.







Top 10 largest market cap prefs in Korea
Ticker
Market cap (₩B)


Samsung Electronics Co Ltd Preference Shares Non Voting
005935
61,551.9


Hyundai Motor S2 Pref Shs
005387
4,049.9


LG Chem Ltd Preference Shares
051915
3,344.6


Hyundai Motor S1 Pref Shs
005385
2,752.3


LG Household &amp; Healthcare Ltd Preference Shares
051905
1,553.8


LG Electronics Inc. Preference Shares
066575
1,254.6


Amorepacific Corp Preference Shares
090435
978.7


Samsung SDI Co Ltd Preferred Shares
006405
711.1


Mirae Asset Securities 2PB
00680K
697.9


Korea Investment Holdings Co., Ltd. Preference Shares
071055
521.4

Source: KRX

These are the top 10 preferred shares having the widest disparity to the ordinary shares. Solus Advanced Materials 1P tops the list with a 66.87% disparity. 4 prefs in total are above a 60% disparity to their respective ordinary share. A total of 19 prefs have a +50% disparity to the ordinary shares.







Top 10 prefs having the widest disparity to ordinary share in Korea
Ticker
Disparity to ordinary share


Solus Advanced Materials 1P
33637K
66.87%


Amorepacific Corp Preference Shares
090435
66.53%


AmoreG 1P Pref Shs
002795
64.19%


Doosan Fuel Cell 1P
33626K
62.63%


Nexen Tire Corp Preference Shares
002355
57.65%


BYC Co., Ltd Preference Shares
001465
56.61%


Doosan Fuel Cell 2PB
33626L
53.91%


Hyundai Motor S3 Pref Shs
005389
53.57%


LG Household &amp; Healthcare Ltd Preference Shares
051905
52.90%


LG Chem Ltd Preference Shares
051915
52.67%

Source: KRX



<p>SK IET's institutional lockup results are out. The final percentage of the locked shares allocated to the institutional investors is <strong>66.68%</strong> of the institutional allocation. </p><table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr><td colspan="3" rowspan="1" data-sheets-value='{"1":2,"2":"Institutional investors pledging lockups"}'>Institutional investors pledging lockups</td></tr>
<tr>
<td data-sheets-value='{"1":2,"2":"6 months"}'>6 months</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":3020988}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>3,020,988</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.25678847379829145}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=R[0]C[-1]/R15C2">25.68%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"3 months"}'>3 months</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":2087672}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>2,087,672</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.17745522546644563}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=R[0]C[-1]/R15C2">17.75%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"1 month"}'>1 month</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":2700264}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>2,700,264</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.22952645671299243}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=R[0]C[-1]/R15C2">22.95%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"15 days"}'>15 days</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":36172}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>36,172</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.0030746738067916183}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=R[0]C[-1]/R15C2">0.31%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Total"}'><strong>- Total</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":7845096}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula="=sum(R[-4]C[0]:R[-1]C[0])"><strong>7,845,096</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.6668448297845211}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=R[0]C[-1]/R15C2"><strong>66.68%</strong></td>
</tr>
<tr><td colspan="3" rowspan="1" data-sheets-value='{"1":2,"2":"Source: SED"}'>Source: SED</td></tr>
</tbody>
</table><p>So, the immediate float shares come down to 10.72M shares, including the ones owned by the major shareholder, representing <strong>15.04%</strong> of the post-IPO total shares.</p><table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr><td colspan="2" style="text-align: left;" data-sheets-value='{"1":2,"2":"Immediate float shares"}'><div><div>Immediate float shares</div></div></td></tr>
<tr>
<td data-sheets-value='{"1":2,"2":"1 year"}'>1 year</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":2823956}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula="=R[-15]C[0]">2,823,956</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"6 months"}'>6 months</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":52928580}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula="=R[-18]C[0]+R[-17]C[0]+R[-9]C[0]">52,928,580</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"3 months"}'>3 months</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":2087672}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula="=R[-9]C[0]">2,087,672</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"1 month"}'>1 month</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":2700264}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula="=R[-9]C[0]">2,700,264</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"15 days"}'>15 days</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":36172}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula="=R[-9]C[0]">36,172</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Immediate float shares"}'><strong>Immediate float shares</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":10720948}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula="=R[-23]C[0]-sum(R[-5]C[0]:R[-1]C[0])"><strong>10,720,948</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - % of post-IPO total shares"}'><strong>- % of post-IPO total shares</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.15036900544972123}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=R[-1]C[0]/R[-24]C[0]"><strong>15.04%</strong></td>
</tr>
<tr><td colspan="2" data-sheets-value='{"1":2,"2":"Source: SED"}'>Source: SED</td></tr>
</tbody>
</table><p>The ESOP spit out substantial forfeited shares, representing 2.04% of the post-IPO total shares. These forfeited shares went to the local retail subscribers, bringing up the final allocation to <strong>9.54%</strong>, while the institutional allocation remains at <strong>16.50%</strong>.</p><table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr>
<td data-sheets-value='{"1":2,"2":"Shareholder"}'>Shareholder</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Shares"}'>Shares</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Shareholding %"}'>Shareholding %</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Lockup period"}'>Lockup period</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Post-IPO shares outstanding"}'>Post-IPO total shares</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":71297592}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula="=Terms!R[8]C[0]">71,297,592</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":1}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=R[0]C[-1]/R10C2">100.00%</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"-"}'>-</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"SK Innovation"}'>SK Innovation</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":43633432}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>43,633,432</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.6119902618871055}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=R[0]C[-1]/R10C2">61.20%</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"6 months"}'>6 months</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Premier Superior Ltd."}'>Premier Superior Ltd.</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":6274160}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>6,274,160</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.08799960593339534}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=R[0]C[-1]/R10C2">8.80%</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"6 months"}'>6 months</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"ESOP"}'>ESOP</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":2823956}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>2,823,956</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.03960801368999951}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=R[0]C[-1]/R10C2">3.96%</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"1 year"}'>1 year</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"IPO"}'>IPO</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":18566044}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula="=R[-4]C[0]-R[-3]C[0]-R[-2]C[0]-R[-1]C[0]">18,566,044</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.2604021184894996}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=R[0]C[-1]/R10C2">26.04%</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"?"}'>-</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Institutional"}'><strong>- Institutional</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":11764500.000000002}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'><strong>11,764,500</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.16500557269872454}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=R[0]C[-1]/R10C2"><strong>16.50%</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"?"}'><strong>-</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Retail"}'><strong>- Retail</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":6801543.999999998}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula="=R[-2]C[0]-R[-1]C[0]"><strong>6,801,544</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.09539654579077507}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=R[0]C[-1]/R10C2"><strong>9.54%</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"-"}'><strong>-</strong></td>
</tr>
<tr><td colspan="4" rowspan="1" data-sheets-value='{"1":2,"2":"Source: DART"}'>Source: DART</td></tr>
</tbody>
</table>

SK IET's institutional lockup results are out. The final percentage of the locked shares allocated to the institutional investors is 66.68% of the institutional allocation. 






Institutional investors pledging lockups

6 months
3,020,988
25.68%


3 months
2,087,672
17.75%


1 month
2,700,264
22.95%


15 days
36,172
0.31%


- Total
7,845,096
66.68%

Source: SED

So, the immediate float shares come down to 10.72M shares, including the ones owned by the major shareholder, representing 15.04% of the post-IPO total shares.





Immediate float shares

1 year
2,823,956


6 months
52,928,580


3 months
2,087,672


1 month
2,700,264


15 days
36,172


Immediate float shares
10,720,948


- % of post-IPO total shares
15.04%

Source: SED

The ESOP spit out substantial forfeited shares, representing 2.04% of the post-IPO total shares. These forfeited shares went to the local retail subscribers, bringing up the final allocation to 9.54%, while the institutional allocation remains at 16.50%.








Shareholder
Shares
Shareholding %
Lockup period


Post-IPO total shares
71,297,592
100.00%
-


SK Innovation
43,633,432
61.20%
6 months


Premier Superior Ltd.
6,274,160
8.80%
6 months


ESOP
2,823,956
3.96%
1 year


IPO
18,566,044
26.04%
-


- Institutional
11,764,500
16.50%
-


- Retail
6,801,544
9.54%
-

Source: DART



SK IE Technology: Immediate Float 15.04% & KOSPI 200 Index Float 21.80%

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

<div class="content-highlight"><p>In this insight, we highlight the closing of the pricing gaps between the major Korean holdcos and opcos, especially with the upcoming end of the ban on the short selling of shares in Korea in May. In this insight, we highlight 26 pair trades that involve Korean holdcos and opcos.</p></div><p>Just a reminder that the ban on short selling of KOSPI 200 and KOSDAQ 150 included stocks will remain in place until May 2nd and investors will be able to resume their shorting on these 350 stocks starting on May 3rd. Once this ban on short selling of stocks ends, there could be more investors that may look to add to the holdco shares and short the opco shares (especially among the pairs where the holdco shares have underperformed the opco shares in the past year). However, some of these moves have already started to take place in the past few weeks, which could reduce the overall profits on the pair trades. </p><p>Traditionally, the pair trades involving Korean holdcos and opcos have been a trading strategy that many hedge funds have employed for many years. However, the ban on short selling of stocks in Korea have prevented many of these funds from employing these pair trade strategies. Once the ban ends, you will likely see these funds becoming more active in these trading methods once again. </p><div class="content-highlight">
<p>In the section below, we separated the pair trades into two different sections. The first table involves major opcos outperforming holdcos (regular and quasi) in the past year. Of the 26 pair trade strategies mentioned in this insight, this section I involves 19 of them (73% of total). The section II (which involve holdcos outperforming the opcos in the past year) involves 7 pair trade strategies (27% of total).</p>
<p>In other words, the opcos in general have vastly outperformed the holdcos in the past year, especially due to the ban on the short selling of stocks in Korea. Because the opcos tend to be the bigger company than the holdcos in terms of market cap, many fund managers (both active and passive) have tended to just invest in the opcos and pay less attention to the holdcos.  </p>
</div><p>Also, we described the holdcos as either regular or quasi. SK Telecom and Samsung C&amp;T would be examples of "quasi" holdcos whereas Orion Holdings and Hanjin Kal would be examples of regular holdcos. </p>

In this insight, we highlight the closing of the pricing gaps between the major Korean holdcos and opcos, especially with the upcoming end of the ban on the short selling of shares in Korea in May. In this insight, we highlight 26 pair trades that involve Korean holdcos and opcos.Just a reminder that the ban on short selling of KOSPI 200 and KOSDAQ 150 included stocks will remain in place until May 2nd and investors will be able to resume their shorting on these 350 stocks starting on May 3rd. Once this ban on short selling of stocks ends, there could be more investors that may look to add to the holdco shares and short the opco shares (especially among the pairs where the holdco shares have underperformed the opco shares in the past year). However, some of these moves have already started to take place in the past few weeks, which could reduce the overall profits on the pair trades. Traditionally, the pair trades involving Korean holdcos and opcos have been a trading strategy that many hedge funds have employed for many years. However, the ban on short selling of stocks in Korea have prevented many of these funds from employing these pair trade strategies. Once the ban ends, you will likely see these funds becoming more active in these trading methods once again. 
In the section below, we separated the pair trades into two different sections. The first table involves major opcos outperforming holdcos (regular and quasi) in the past year. Of the 26 pair trade strategies mentioned in this insight, this section I involves 19 of them (73% of total). The section II (which involve holdcos outperforming the opcos in the past year) involves 7 pair trade strategies (27% of total).
In other words, the opcos in general have vastly outperformed the holdcos in the past year, especially due to the ban on the short selling of stocks in Korea. Because the opcos tend to be the bigger company than the holdcos in terms of market cap, many fund managers (both active and passive) have tended to just invest in the opcos and pay less attention to the holdcos.  
Also, we described the holdcos as either regular or quasi. SK Telecom and Samsung C&amp;T would be examples of "quasi" holdcos whereas Orion Holdings and Hanjin Kal would be examples of regular holdcos. 

Closing the Gap: Korean Holdcos Vs. Opcos

South Korea

SK Innovation Co., Ltd. refines, markets, and distributes oil.  The Company produces a variety of petroleum products, such as gasoline, kerosene, liquefied petroleumgas (LPG), and diesel oil.  SK Energy also manufactures petrochemical p roducts, including paraxylene, synthetic resins, styrene monomer, and ethylene.

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SK Innovation (096770 KS)

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Sanghyun Park

Closing the Gap: Korean Holdcos Vs. Opcos

In this insight, we highlight the closing of the pricing gaps between the major Korean holdcos and opcos, especially with the upcoming end of the...

Douglas Kim

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