Senior Credit Analyst, Lucror Analytics

Leonard Law, CFA

Senior Credit Analyst

High Yield Experts

Lucror Analytics

Lucror Analytics is a leading credit and ESG research specialist and a provider of technology solutions for differentiated fixed income strategies. Our roots are in bottom-up fundamental credit analysis with a specialization in high yield corporate credits from Europe, Asia and Latin America. We are one of few research specialists integrating ESG considerations with fundamental credit research through a dedicated ESG platform. Our ESG assessment covers five key criteria: Disclosure, E,S, & G Pillars, Controversies, ESG Impact on Credit and ESG Momentum.

Recognizing the importance and value-add of Factor Investing in fixed income, Lucror developed the Smart Quant Navigator (SQN), an intuitive platform that helps clients devise and implement factor-based strategies ranging from pure quant to active fundamental, with integrated ESG.

Our company has been at the forefront of developments in the fixed income markets, identifying opportunities and consistently delivering new products and value-adding solutions to clients. Lucror has close relationships with the largest and most reputable asset managers, family offices, hedge funds, investment and wealth managers globally.

Credit

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.<ul><li><a href='#lucror-entity-18054'>China Fortune Land</a></li><li><a href='#lucror-entity-6159'>China SCE</a></li><li><a href='#lucror-entity-315'>Softbank Group</a></li></ul>

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.China Fortune LandChina SCESoftbank Group

Morning Views Asia: China Fortune Land, China SCE, Softbank Group

APAC IPOs & Placements

Zhen Zhou, Toh

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

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In this note, we aim to highlight the Asia Pacific IPO pipeline for 2021. This list has been compiled on a best effort basis from tracking the company filings and through various media and other sources.
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For readers who are not familiar with our coverage, we aim to cover all IPOs and placements with a minimum deal size of US$100m across Asia-Pacific (ex-Korea and A-shares), including China ADRs. Hence, our pipeline will only include companies that fit these criterion.
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Feel free to drop us a message for additional information (bookrunners and coverage) on these IPOs
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In this note, we aim to highlight the Asia Pacific IPO pipeline for 2021. This list has been compiled on a best effort basis from tracking the company filings and through various media and other sources.


For readers who are not familiar with our coverage, we aim to cover all IPOs and placements with a minimum deal size of US$100m across Asia-Pacific (ex-Korea and A-shares), including China ADRs. Hence, our pipeline will only include companies that fit these criterion.


Feel free to drop us a message for additional information (bookrunners and coverage) on these IPOs


Aequitas 2021 Asia IPO Pipeline - More Mega IPOs to Come

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

On Friday after the close, the TSE belatedly released its annual TSE Free Float Weight adjustments for stocks with fiscal year ends in March. Normally this comes out in October, and is executed at the end of October, but for the 2020 Free Float Weight Rebalance, as per an announcement made by the TSE on 22 June 2020, special measures were taken in light of the covid-19 pandemic, and the rebalance was delayed by 3 months. 
There are no major surprises that I see. Some buybacks from the market have led to slightly lower FFW coefficients. Some secondary offerings have led to increases in FFW coefficients. As discussed in <a href="https://www.smartkarma.com/insights/japan-post-insurance-update-three-reasons-to-buy-any-overhang-slightly-higher" target="_blank" data-smartkarma-citation="insights:46862" rel="noopener">Japan Post Insurance Update - Three Reasons To Buy. Any Overhang Slightly Higher</a> on Friday, one of the big names to the buy side is indeed <a href="https://www.smartkarma.com/entities/japan-post-insurance-co-ltd" target="_blank" data-smartkarma-citation="entities:840:1" rel="noopener">Japan Post Insurance (7181 JP)</a>.
For more on the rebalance, read on.
[A spreadsheet of all names and impacts is attached at the bottom of the insight]

On Friday after the close, the TSE belatedly released its annual TSE Free Float Weight adjustments for stocks with fiscal year ends in March. Normally this comes out in October, and is executed at the end of October, but for the 2020 Free Float Weight Rebalance, as per an announcement made by the TSE on 22 June 2020, special measures were taken in light of the covid-19 pandemic, and the rebalance was delayed by 3 months. 
There are no major surprises that I see. Some buybacks from the market have led to slightly lower FFW coefficients. Some secondary offerings have led to increases in FFW coefficients. As discussed in Japan Post Insurance Update - Three Reasons To Buy. Any Overhang Slightly Higher on Friday, one of the big names to the buy side is indeed Japan Post Insurance (7181 JP).
For more on the rebalance, read on.
[A spreadsheet of all names and impacts is attached at the bottom of the insight]

The Delayed TOPIX FFW Rebalance: $32bn To Trade

This month, we review the developments of 2020, an extraordinary year from an investor’s perspective, and give our outlook for the year ahead.  The Asia Monthly focuses on providing updates on recent events, information on new issues and spread movements, as well as summarising our top picks, and discussing specific areas of interest in the “In-Focus” section. The Asia Monthly is intended to broaden investors' understanding of the Asian USD high-yield market.

  This month, we review the developments of 2020, an extraordinary year from an investor’s perspective, and give our outlook for the year ahead.    The Asia Monthly focuses on providing updates on recent events, information on new issues and spread movements, as well as summarising our top picks, and discussing specific areas of interest in the “In-Focus” section. The Asia Monthly is intended to broaden investors' understanding of the Asian USD high-yield market.  

Asia HY Monthly - 2020 In Review And 2021 Outlook - Lucror Analytics

NTT (Nippon Telegraph & Telephone) / Event-Driven

When <a href="https://www.smartkarma.com/entities/nippon-telegraph-telephone-corporation" target="_blank" data-smartkarma-citation="entities:623:1" rel="noopener">NTT (Nippon Telegraph &amp; Telephone) (9432 JP)</a> announced its takeover of <a href="https://www.smartkarma.com/entities/ntt-docomo-inc" target="_blank" data-smartkarma-citation="entities:1089:1" rel="noopener">NTT Docomo Inc (9437 JP)</a>, the immediate market reaction was to sell. This was seen as a sign that NTT was going to "take responsibility" for giving money back to customers. I wasn't sure why. Spending ¥4trln to buyback ¥200bn of minority interest net income was the equivalent of an enormous buyback. And given that doing so did not reward the government, which still holds more than one-third of NTT, in any way, NTT had to continue to reward the government through returns to shareholders - i.e. dividends and buybacks. Some of that was going to be supported through higher EPS, allowing continued growth in dividends. However, the government counts on getting an additional few hundred billion yen through sales proceeds every few years to fund its special projects, so the buybacks needed to continue, and as discussed many times on Smartkarma in the past, that only happens if NTT buys back stock from the public first, creating room under the NTT Law to allow NTT to buy back shares from the government while still keeping the government over one-third (or over the complicated and not-exactly-one-third calculation minimum under the law). When shares fell, NTT in November made clear that it was a) going to change things around at the NTT Docomo subsidiary - the CEO was out even before the Tender Offer ended - and b) was going to continue providing returns to shareholders. It announced a buyback on 8 November which was going to have big impact.I discussed in <a href="https://www.smartkarma.com/insights/ntt-go-big-or-go-home" target="_blank" data-smartkarma-citation="insights:44964" rel="noopener">NTT - Go Big Or Go Home</a> then later in <a href="https://www.smartkarma.com/insights/ntt-still-going-big-not-going-home" target="_blank" data-smartkarma-citation="insights:46264" rel="noopener">NTT - Still Going Big, Not Going Home</a>.Yesterday, NTT announced the results of its repurchase for December. It was not subtle. NTT was 18% of volume in December. There may be more impact to come.

When NTT (Nippon Telegraph &amp; Telephone) (9432 JP) announced its takeover of NTT Docomo Inc (9437 JP), the immediate market reaction was to sell. This was seen as a sign that NTT was going to "take responsibility" for giving money back to customers. I wasn't sure why. Spending ¥4trln to buyback ¥200bn of minority interest net income was the equivalent of an enormous buyback. And given that doing so did not reward the government, which still holds more than one-third of NTT, in any way, NTT had to continue to reward the government through returns to shareholders - i.e. dividends and buybacks. Some of that was going to be supported through higher EPS, allowing continued growth in dividends. However, the government counts on getting an additional few hundred billion yen through sales proceeds every few years to fund its special projects, so the buybacks needed to continue, and as discussed many times on Smartkarma in the past, that only happens if NTT buys back stock from the public first, creating room under the NTT Law to allow NTT to buy back shares from the government while still keeping the government over one-third (or over the complicated and not-exactly-one-third calculation minimum under the law). When shares fell, NTT in November made clear that it was a) going to change things around at the NTT Docomo subsidiary - the CEO was out even before the Tender Offer ended - and b) was going to continue providing returns to shareholders. It announced a buyback on 8 November which was going to have big impact.I discussed in NTT - Go Big Or Go Home then later in NTT - Still Going Big, Not Going Home.Yesterday, NTT announced the results of its repurchase for December. It was not subtle. NTT was 18% of volume in December. There may be more impact to come.

NTT's Big Beautiful Buyback Is Not The Only Reason to Own

Japan

SoftBank Group Corp. provides telecommunication services. The Company also operates ADSL (Asymmetric Digital Subscriber Line) and fiber optic high-speed Internet connection, e-Commerce businesses, and Internet based advertising and auction businesses.

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Softbank Group (9984 JP)

Morning Views Asia: China Fortune Land, China SCE, Softbank Group

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region,...

Lucror Analytics

Aequitas 2021 Asia IPO Pipeline - More Mega IPOs to Come

We aim to highlight the Asia Pacific IPO pipeline for 2021. This list has been compiled on a best effort basis from tracking the company filings...

Zhen Zhou, Toh

The Delayed TOPIX FFW Rebalance: $32bn To Trade

The Big Annual TOPIX FFW Rebalance of October 2020 was delayed until January. The results were not terribly surprising. Nevertheless, it is a big...

Travis Lundy

Asia HY Monthly - 2020 In Review And 2021 Outlook - Lucror Analytics

This month, we review the developments of 2020, an extraordinary year from an investor’s perspective, and give our outlook for the year ahead. ...

Lucror Analytics

NTT's Big Beautiful Buyback Is Not The Only Reason to Own

NTT's Buyback is big and beautiful, but it is not the only reason to own. There are two other good reasons. But the buyback will still have impact...

Travis Lundy

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