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

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Quantitative Analysis

<div><p>The Asia Short Interest weekly looks at moves in market wide short interest and highlights movements in stock specific short interest across Hong Kong, Japan, Korea and Taiwan using the last available data published by the relevant authorities.</p></div><div><p>Hong Kong saw shorts rise on <a href="https://www.smartkarma.com/entities/xinyi-solar-holdings-ltd" target="_blank" data-smartkarma-citation="entities:318:1" rel="noopener">Xinyi Solar Holdings (968 HK)</a>, <a href="https://www.smartkarma.com/entities/lenovo-group-ltd" target="_blank" data-smartkarma-citation="entities:13359:1" rel="noopener">Lenovo (992 HK)</a>, <a href="https://www.smartkarma.com/entities/jd-health-international-inc" target="_blank" data-smartkarma-citation="entities:29677:1" rel="noopener">JD Health (6618 HK)</a>, <a href="https://www.smartkarma.com/entities/byd-co-ltd-h" target="_blank" data-smartkarma-citation="entities:20962:1" rel="noopener">BYD (1211 HK)</a> and <a href="https://www.smartkarma.com/entities/alibaba-group" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba Group (9988 HK)</a> while there was short covering on <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent Holdings (700 HK)</a>, <a href="https://www.smartkarma.com/entities/xiaomi-corp" target="_blank" data-smartkarma-citation="entities:24409:1" rel="noopener">Xiaomi Corp (1810 HK)</a>, <a href="https://www.smartkarma.com/entities/china-pacific-insurance-group" target="_blank" data-smartkarma-citation="entities:6177:1" rel="noopener">China Pacific Insurance (2601 HK)</a>, <a href="https://www.smartkarma.com/entities/sunny-optical-tech" target="_blank" data-smartkarma-citation="entities:13363:1" rel="noopener">Sunny Optical (2382 HK)</a> and <a href="https://www.smartkarma.com/entities/cspc-pharmaceutical-group-ltd" target="_blank" data-smartkarma-citation="entities:229:1" rel="noopener">CSPC Pharmaceutical Group (1093 HK)</a>. Shorts increased in Consumer Discretionary, Consumer Staples, Health Care and Information Technology, while shorts decreased in Communication Services, Financials, Real Estate and Industrials.</p></div><div><p>In Japan, stocks that saw the most shorts were <a href="https://www.smartkarma.com/entities/eneos-holdings-inc" target="_blank" data-smartkarma-citation="entities:638:1" rel="noopener">ENEOS Holdings (5020 JP)</a>, <a href="https://www.smartkarma.com/entities/mitsubishi-ufj-financial-group" target="_blank" data-smartkarma-citation="entities:218:1" rel="noopener">Mitsubishi UFJ Financial (MUFG) (8306 JP)</a>, <a href="https://www.smartkarma.com/entities/resona-holdings-inc" target="_blank" data-smartkarma-citation="entities:6841:1" rel="noopener">Resona Holdings (8308 JP)</a>, <a href="https://www.smartkarma.com/entities/mitsubishi-ufj-lease-finance" target="_blank" data-smartkarma-citation="entities:1467:1" rel="noopener">Mitsubishi UFJ Lease &amp; Finance (8593 JP)</a> and <a href="https://www.smartkarma.com/entities/nsk-ltd" target="_blank" data-smartkarma-citation="entities:6309:1" rel="noopener">NSK Ltd (6471 JP)</a> while shorts decreased on <a href="https://www.smartkarma.com/entities/toshiba-corp" target="_blank" data-smartkarma-citation="entities:637:1" rel="noopener">Toshiba Corp (6502 JP)</a>, <a href="https://www.smartkarma.com/entities/asics-corp" target="_blank" data-smartkarma-citation="entities:16287:1" rel="noopener">ASICS Corp (7936 JP)</a>, <a href="https://www.smartkarma.com/entities/haseko-corp" target="_blank" data-smartkarma-citation="entities:748:1" rel="noopener">Haseko Corp (1808 JP)</a>, <a href="https://www.smartkarma.com/entities/cyberagent-inc" target="_blank" data-smartkarma-citation="entities:8197:1" rel="noopener">CyberAgent Inc (4751 JP)</a> and <a href="https://www.smartkarma.com/entities/idemitsu-kosan-co-ltd" target="_blank" data-smartkarma-citation="entities:109:1" rel="noopener">Idemitsu Kosan (5019 JP)</a>. Shorts increased in Financials, Energy, Health Care and Information Technology sectors, and decreased in the Industrials sector.</p></div><div><p>In Korea, short increased on <a href="https://www.smartkarma.com/entities/amorepacific-corp" target="_blank" data-smartkarma-citation="entities:20854:1" rel="noopener">Amorepacific Corp (090430 KS)</a>, <a href="https://www.smartkarma.com/entities/korea-united-pharm-inc" target="_blank" data-smartkarma-citation="entities:5207:1" rel="noopener">Korea United Pharm (033270 KS)</a>, <a href="https://www.smartkarma.com/entities/lg-chem-ltd" target="_blank" data-smartkarma-citation="entities:3583:1" rel="noopener">LG Chem Ltd (051910 KS)</a> and <a href="https://www.smartkarma.com/entities/korea-electric-power-corp" target="_blank" data-smartkarma-citation="entities:16:1" rel="noopener">Korea Electric Power (015760 KS)</a> while shorts decreased on <a href="https://www.smartkarma.com/entities/samsung-electronics-co-ltd" target="_blank" data-smartkarma-citation="entities:191:1" rel="noopener">Samsung Electronics (005930 KS)</a>, <a href="https://www.smartkarma.com/entities/doosan-infracore-co-ltd" target="_blank" data-smartkarma-citation="entities:3982:1" rel="noopener">Doosan Infracore (042670 KS)</a>, <a href="https://www.smartkarma.com/entities/naver-corp" target="_blank" data-smartkarma-citation="entities:16029:1" rel="noopener">Naver Corp (035420 KS)</a> and <a href="https://www.smartkarma.com/entities/sk-hynix-inc" target="_blank" data-smartkarma-citation="entities:16955:1" rel="noopener">SK Hynix (000660 KS)</a>. </p></div><div><p>Stocks in Taiwan that saw the highest increase in shorts were <a href="https://www.smartkarma.com/entities/pegatron-corp" target="_blank" data-smartkarma-citation="entities:12852:1" rel="noopener">Pegatron Corp (4938 TT)</a>, <a href="https://www.smartkarma.com/entities/unimicron-technology-corp" target="_blank" data-smartkarma-citation="entities:18778:1" rel="noopener">Unimicron Technology (3037 TT)</a>, <a href="https://www.smartkarma.com/entities/yulon-motor-company" target="_blank" data-smartkarma-citation="entities:18249:1" rel="noopener">Yulon Motor Company (2201 TT)</a> and <a href="https://www.smartkarma.com/entities/united-microelectronics-corp" target="_blank" data-smartkarma-citation="entities:6450:1" rel="noopener">United Microelectronics Corp (2303 TT)</a> while shorts were covered on <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/yageo-corporation" target="_blank" data-smartkarma-citation="entities:13212:1" rel="noopener">Yageo Corporation (2327 TT)</a>, <a href="https://www.smartkarma.com/entities/au-optronics-corp" target="_blank" data-smartkarma-citation="entities:6704:1" rel="noopener">AU Optronics (2409 TT)</a> and <a href="https://www.smartkarma.com/entities/acer-inc" target="_blank" data-smartkarma-citation="entities:15726:1" rel="noopener">Acer Inc (2353 TT)</a>. </p></div>

The Asia Short Interest weekly looks at moves in market wide short interest and highlights movements in stock specific short interest across Hong Kong, Japan, Korea and Taiwan using the last available data published by the relevant authorities.Hong Kong saw shorts rise on Xinyi Solar Holdings (968 HK), Lenovo (992 HK), JD Health (6618 HK), BYD (1211 HK) and Alibaba Group (9988 HK) while there was short covering on Tencent Holdings (700 HK), Xiaomi Corp (1810 HK), China Pacific Insurance (2601 HK), Sunny Optical (2382 HK) and CSPC Pharmaceutical Group (1093 HK). Shorts increased in Consumer Discretionary, Consumer Staples, Health Care and Information Technology, while shorts decreased in Communication Services, Financials, Real Estate and Industrials.In Japan, stocks that saw the most shorts were ENEOS Holdings (5020 JP), Mitsubishi UFJ Financial (MUFG) (8306 JP), Resona Holdings (8308 JP), Mitsubishi UFJ Lease &amp; Finance (8593 JP) and NSK Ltd (6471 JP) while shorts decreased on Toshiba Corp (6502 JP), ASICS Corp (7936 JP), Haseko Corp (1808 JP), CyberAgent Inc (4751 JP) and Idemitsu Kosan (5019 JP). Shorts increased in Financials, Energy, Health Care and Information Technology sectors, and decreased in the Industrials sector.In Korea, short increased on Amorepacific Corp (090430 KS), Korea United Pharm (033270 KS), LG Chem Ltd (051910 KS) and Korea Electric Power (015760 KS) while shorts decreased on Samsung Electronics (005930 KS), Doosan Infracore (042670 KS), Naver Corp (035420 KS) and SK Hynix (000660 KS). Stocks in Taiwan that saw the highest increase in shorts were Pegatron Corp (4938 TT), Unimicron Technology (3037 TT), Yulon Motor Company (2201 TT) and United Microelectronics Corp (2303 TT) while shorts were covered on TSMC (2330 TT), Yageo Corporation (2327 TT), AU Optronics (2409 TT) and Acer Inc (2353 TT). 

Asia Short Interest: Xinyi Solar, Alibaba, Tencent, ENEOS, Resona, Toshiba, Samsung, TSMC, Yageo

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.

Doubleu Games leads KOSPI 200 stocks this morning with a 16% gain.It announced this morning that it would IPO one of its subsidiaries, Doubledown Interactive (mobile social gambling website), on NASDAQ as early as possible.Doubleu Games acquired Doubledown in 2017, which delivered ₩422.9B in sales last year, +33% YoY.HMM is making a move today with a 5% gain. It is mainly due to the news that HMM will begin to operate HMM Nuri, the first of eight 16000 TEU-class newbuild containerships.






Gainers
Daily Δ


Doubleu Games Co Ltd
16.26%


HMM Co Ltd
4.71%


GS Engineering &amp; Construction Corp
4.41%


Kolon Industries Inc
4.23%


POSCO
4.12%


Hansae Co., Ltd.
3.88%


Netmarble Corp
3.67%


Fila Holdings Corp
3.64%


HDC Hyundai Development Co
3.51%


SK Networks Co Ltd
2.81%


Huchems Fine Chemical Corporation
2.79%


Celltrion, Inc.
2.77%


LG Display Co Ltd
2.44%


Dong-A Socio Holdings Co Ltd
2.39%


Hanwha Solutions Corp
2.31%


Daewoo Engineering &amp; Construction Co Ltd
2.04%


Hyundai Engineering &amp; Construction Co.
1.86%


Ilyang Pharmaceutical Co., Ltd
1.59%


Halla Holdings Corp
1.58%


Kumho Petro Chemical Co Ltd
1.46%

Source: KRX

POSCO International is the biggest loser early today, mainly due to the concern over the gas pipe project in Myanmar.SKC follows with a 4.4% loss on its first trading day since the suspension following the prosecution’s indictment of SK Networks chairman on charges of embezzlement and a breach of trust.SKC's daily price volatility now sits at 11.2% of the opening.






Losers
Daily Δ


Posco International Corp
-4.42%


SKC Co Ltd
-4.39%


Chong Kun Dang Pharmaceutical Corp
-3.62%


LG Electronics Inc.
-3.23%


Doosan Infracore Co Ltd
-3.14%


Lotte Shopping Co Ltd
-2.73%


Cuckoo Holdings Co Ltd
-2.62%


Asiana Airlines Inc
-2.52%


Hanwha Aerospace Co Ltd
-2.45%


Hyundai Wia Corp
-2.42%


Youngpoong Corp
-2.19%


BGF Co Ltd
-2.19%


Shinsegae Inc
-2.13%


LIG Nex1 Co Ltd
-2.11%


KEPCO Engineering &amp; Construction Co Inc
-2.10%


BNK Financial Group Inc
-2.05%


Kumho Tire Co Inc
-2.04%


SNT MOTIV Co Ltd
-2.03%


Korea Aerospace Industries Ltd
-2.00%


Hyundai Green Food Co Ltd
-1.91%

Source: KRX

SKC, HMM, Pan Ocean, and Doosan Infracore are highly volatile in price early today.






x Open (daily price volatility)
Value


Doubleu Games Co Ltd
15.08%


SKC Co Ltd
11.21%


HMM Co Ltd
9.51%


Pan Ocean Co Ltd
7.71%


Doosan Infracore Co Ltd
7.32%


Hansae Co., Ltd.
6.36%


Bukwang Pharm Co Ltd
5.36%


Daewoo Engineering &amp; Construction Co Ltd
5.16%


Kolon Industries Inc
4.54%


Fila Holdings Corp
4.47%


Korea Aerospace Industries Ltd
4.44%


HDC Hyundai Development Co
4.37%


Hanwha Aerospace Co Ltd
4.37%


Lotte Shopping Co Ltd
4.28%


Oci Co Ltd
4.26%


Halla Holdings Corp
4.22%


LG Electronics Inc.
4.19%


SK Chemicals Co Ltd
4.14%


GS Engineering &amp; Construction Corp
4.14%


Netmarble Corp
4.05%

Source: KRX

Doubleu Games trading exploded, already at 13.87x DTV.Infracore continues to draw a lot of attention as its TV at this point already tripled 1M DTV.






TV/DTV (x)
Value


Doubleu Games Co Ltd
13.87


Doosan Infracore Co Ltd
3.52


SKC Co Ltd
2.55


Pan Ocean Co Ltd
1.79


HMM Co Ltd
1.64


Binggrae Co Ltd
1.55


Lotte Corp
1.51


GS Engineering &amp; Construction Corp
1.49


HDC Hyundai Development Co
1.21


SK Networks Co Ltd
1.20


Daewoo Engineering &amp; Construction Co Ltd
1.16


Lotte Fine Chemical Co Ltd
1.07


Fila Holdings Corp
1.04


Huchems Fine Chemical Corporation
1.00


SPC Samlip Co Ltd
0.96


Hyundai Engineering &amp; Construction Co.
0.95


Mando Corp
0.84


LG Display Co Ltd
0.76


Netmarble Corp
0.74


Korea Electric Power Corporation
0.72

Source: KRX



KOSPI 200 Daily Movers: Doubleu Games, HMM, SKC, & Doosan Infracore

Event-Driven

<p>The split ratio (Infracore) is 0.6895026. The one to merge with Heavy takes 0.6895026.</p><p>Then, the merger ratio is 0.6866211, making the swap ratio 0.4734270.</p><p>The remaining 0.3104974 of Infracore will remain on KOSPI with the ticker 042670.</p><table class="table table-striped">
<colgroup>
<col width="200">
<col width="200">
</colgroup>
<tbody>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Swap ratio"}'>Swap ratio</td></tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Doosan Infracore split ratio"}'>Doosan Infracore split ratio</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.6895026}' data-sheets-numberformat='{"1":2,"2":"#,##0.0000000","3":1}'>0.6895026</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Merger ratio with Doosan Heavy"}'>Merger ratio with Doosan Heavy</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.6866211}' data-sheets-numberformat='{"1":2,"2":"#,##0.0000000","3":1}'>0.6866211</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Swap ratio with Doosan Heavy"}'>Swap ratio with Doosan Heavy</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.47342703366485994}' data-sheets-numberformat='{"1":2,"2":"#,##0.0000000","3":1}' data-sheets-formula="=R[-2]C[0]*R[-1]C[0]">0.4734270</td>
</tr>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Source: DART"}'>Source: DART</td></tr>
</tbody>
</table><table class="table table-striped">
<colgroup>
<col width="200">
<col width="200">
</colgroup>
<tbody>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Swap ratio based on the merger price"}'>Swap ratio based on the merger price</td></tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Name"}'>Name</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Doosan Infracore Co Ltd"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0000000","3":1}' data-sheets-formula='=googlefinance(R[1]C[0], "name")'>Doosan Infracore Co Ltd</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Ticker"}'>Ticker</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"042670"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0000000","3":1}' data-sheets-formula='="042670"'>042670</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Merger price"}'>Merger price</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":7827}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0"}'>₩7,827</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Merger price after split"}'>Post-split merger price</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":5396.7368502}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0"}' data-sheets-formula="=R[-1]C[0]*R[-9]C[0]">₩5,397</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Name"}'>Name</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Doosan Heavy Industries Constrctn Co Ltd"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0000000","3":1}' data-sheets-formula='=googlefinance(R[1]C[0], "name")'>Doosan Heavy Industries Constrctn Co Ltd</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Ticker"}'>Ticker</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"034020"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0000000","3":1}' data-sheets-formula='="034020"'>034020</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Merger price"}'>Merger price</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":11400}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0"}'>₩11,400</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Swap ratio"}'>Merger price-based swap ratio</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.47342703366485994}' data-sheets-numberformat='{"1":2,"2":"#,##0.0000000","3":1}' data-sheets-formula="=R[-11]C[0]">0.4734270</td>
</tr>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Source: DART"}'>Source: DART</td></tr>
</tbody>
</table><p>Infracore soared 21.82% yesterday. Heavy? It had a 2.59% gain.</p><p>As a result, assuming the market value of Infracore's other 0.3104974 remains unchanged, the current market price-based swap ratio is at a +20.9% disparity.</p><table class="table table-striped">
<colgroup>
<col width="200">
<col width="200">
</colgroup>
<tbody>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Swap ratio based on the market price"}'>Swap ratio based on the market price</td></tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Name"}'>Name</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Doosan Infracore Co Ltd"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0000000","3":1}' data-sheets-formula='=googlefinance(R[1]C[0], "name")'>Doosan Infracore Co Ltd</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Ticker"}'>Ticker</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"042670"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0000000","3":1}' data-sheets-formula='="042670"'>042670</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Market price"}'>Market price</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":9880}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0"}' data-sheets-formula='=googlefinance(R[-1]C[0], "price")'>₩9,880</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Market price after split"}'>Post-split market price</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":6812.285688}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0"}' data-sheets-formula="=R[-1]C[0]*R[-20]C[0]">₩6,812</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Name"}'>Name</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Doosan Heavy Industries Constrctn Co Ltd"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0000000","3":1}' data-sheets-formula='=googlefinance(R[1]C[0], "name")'>Doosan Heavy Industries Constrctn Co Ltd</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Ticker"}'>Ticker</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"034020"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0000000","3":1}' data-sheets-formula='="034020"'>034020</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Market price"}'>Market price</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":11900}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0"}' data-sheets-formula='=googlefinance(R[-1]C[0], "price")'>₩11,900</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Swap ratio"}'><strong>Market price-based swap ratio</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.572460982184874}' data-sheets-numberformat='{"1":2,"2":"#,##0.0000000","3":1}' data-sheets-formula="=R[-4]C[0]/R[-1]C[0]"><strong>0.5724610</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Disparity"}'><strong>- Disparity</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.20918524181726464}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=(R[-1]C[0]-R[-12]C[0])/R[-12]C[0]"><strong>+20.92%</strong></td>
</tr>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Source: DART"}'>Source: DART</td></tr>
</tbody>
</table><p>Infracore is now 16.8% above the appraisal rights exercise price. Heavy is +3.8%.</p><p>The ceiling for potential cancellation is ₩300B for Infracore and ₩200B for Heavy.</p><table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr>
<td data-sheets-value='{"1":2,"2":"Entity"}'>Entity</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Purchase rights price"}'>Purchase rights price</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"% to the current price"}'>% to the current price</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Infracore"}'>Infracore</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":8224}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0"}'>₩8,224</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":-0.16761133603238867}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=(R[0]C[-1]-R[-10]C[-1])/R[-10]C[-1]">16.76%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Heavy"}'>Heavy</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":11447}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0"}'>₩11,447</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":-0.038067226890756305}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=(R[0]C[-1]-R[-7]C[-1])/R[-7]C[-1]">3.81%</td>
</tr>
<tr><td colspan="3" rowspan="1" data-sheets-value='{"1":2,"2":"Source: DART"}'>Source: DART</td></tr>
</tbody>
</table>

The split ratio (Infracore) is 0.6895026. The one to merge with Heavy takes 0.6895026.Then, the merger ratio is 0.6866211, making the swap ratio 0.4734270.The remaining 0.3104974 of Infracore will remain on KOSPI with the ticker 042670.





Swap ratio

Doosan Infracore split ratio
0.6895026


Merger ratio with Doosan Heavy
0.6866211


Swap ratio with Doosan Heavy
0.4734270

Source: DART







Swap ratio based on the merger price

Name
Doosan Infracore Co Ltd


Ticker
042670


Merger price
₩7,827


Post-split merger price
₩5,397


Name
Doosan Heavy Industries Constrctn Co Ltd


Ticker
034020


Merger price
₩11,400


Merger price-based swap ratio
0.4734270

Source: DART

Infracore soared 21.82% yesterday. Heavy? It had a 2.59% gain.As a result, assuming the market value of Infracore's other 0.3104974 remains unchanged, the current market price-based swap ratio is at a +20.9% disparity.





Swap ratio based on the market price

Name
Doosan Infracore Co Ltd


Ticker
042670


Market price
₩9,880


Post-split market price
₩6,812


Name
Doosan Heavy Industries Constrctn Co Ltd


Ticker
034020


Market price
₩11,900


Market price-based swap ratio
0.5724610


- Disparity
+20.92%

Source: DART

Infracore is now 16.8% above the appraisal rights exercise price. Heavy is +3.8%.The ceiling for potential cancellation is ₩300B for Infracore and ₩200B for Heavy.







Entity
Purchase rights price
% to the current price


Infracore
₩8,224
16.76%


Heavy
₩11,447
3.81%

Source: DART



Doosan Split/Merger: Infracore in Overshooting

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

<p>On 19 March, <a href="https://www.smartkarma.com/entities/doosan-infracore-co-ltd" target="_blank" data-smartkarma-citation="entities:3982:1" rel="noopener">Doosan Infracore (042670 KS)</a> announced that it will split the operating division (surviving company) and the investment division (Newco company that is being split off). The split off Newco will then be merged with <a href="https://www.smartkarma.com/entities/doosan-heavy-industries-construction" target="_blank" data-smartkarma-citation="entities:7389:1" rel="noopener">Doosan Heavy Industries &amp; Construction (034020 KS)</a>. </p><p><strong>Need to Repay Doosan Infracore Shorts - </strong>As of 18 March, there were 12.56 million shares shorts outstanding for Doosan Infracore, representing 3.4% of total outstanding shares. At the current price of 9,880 won, this represents 124 billion won. There were 61 million shares of Doosan Infracore that were traded on Monday, 21 March and probably a good chunk of these shorted shares were covered. According to Korean regulations, prior to the Newco being formed, the investors that were shorted on the company need to repay them and this was one of the main reasons why Doosan Infracore's shares jumped 21% on Monday. </p><div class="content-highlight"><p><em>The Insight has been marked Bullish since we expect the split off and merger of Doosan Infracore's investment assets to DHIC is likely to result in a higher re-rating of the company's core operating business (construction equipment). There are also signs that the overseas construction business is rebounding in China, which should have a positive impact on Doosan Infracore. In addition, the creation of the Newco (and the getting rid of the previous company's shareholders' list) results in the need for the Doosan Infracore's shorts to cover. </em></p></div>

On 19 March, Doosan Infracore (042670 KS) announced that it will split the operating division (surviving company) and the investment division (Newco company that is being split off). The split off Newco will then be merged with Doosan Heavy Industries &amp; Construction (034020 KS). Need to Repay Doosan Infracore Shorts - As of 18 March, there were 12.56 million shares shorts outstanding for Doosan Infracore, representing 3.4% of total outstanding shares. At the current price of 9,880 won, this represents 124 billion won. There were 61 million shares of Doosan Infracore that were traded on Monday, 21 March and probably a good chunk of these shorted shares were covered. According to Korean regulations, prior to the Newco being formed, the investors that were shorted on the company need to repay them and this was one of the main reasons why Doosan Infracore's shares jumped 21% on Monday. The Insight has been marked Bullish since we expect the split off and merger of Doosan Infracore's investment assets to DHIC is likely to result in a higher re-rating of the company's core operating business (construction equipment). There are also signs that the overseas construction business is rebounding in China, which should have a positive impact on Doosan Infracore. In addition, the creation of the Newco (and the getting rid of the previous company's shareholders' list) results in the need for the Doosan Infracore's shorts to cover. 

Doosan Infracore: Investco Split Off & Merger Ratio Announced

<div><p>The Asia Short Interest weekly looks at moves in market wide short interest and highlights movements in stock specific short interest across Hong Kong, Japan, Korea and Taiwan using the last available data published by the relevant authorities.</p></div><div><p>Hong Kong saw shorts rise on <a href="https://www.smartkarma.com/entities/xinyi-solar-holdings-ltd" target="_blank" data-smartkarma-citation="entities:318:1" rel="noopener">Xinyi Solar Holdings (968 HK)</a>, <a href="https://www.smartkarma.com/entities/lenovo-group-ltd" target="_blank" data-smartkarma-citation="entities:13359:1" rel="noopener">Lenovo (992 HK)</a>, <a href="https://www.smartkarma.com/entities/ping-an-insurance-grp-co-of-china-ltd" target="_blank" data-smartkarma-citation="entities:12880:1" rel="noopener">Ping An Insurance (H) (2318 HK)</a>, <a href="https://www.smartkarma.com/entities/beijing-kuaishou-technology-co-ltd" target="_blank" data-smartkarma-citation="entities:29725:1" rel="noopener">Kuaishou Technology (1024 HK)</a> and <a href="https://www.smartkarma.com/entities/jd-health-international-inc" target="_blank" data-smartkarma-citation="entities:29677:1" rel="noopener">JD Health (6618 HK)</a> while there was short covering on <a href="https://www.smartkarma.com/entities/alibaba-group" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba Group (9988 HK)</a>, <a href="https://www.smartkarma.com/entities/xiaomi-corp" target="_blank" data-smartkarma-citation="entities:24409:1" rel="noopener">Xiaomi Corp (1810 HK)</a>, <a href="https://www.smartkarma.com/entities/haier-smart-home-co-ltd-b3ef445f-0f54-4586-8c58-9073de98d60e" target="_blank" data-smartkarma-citation="entities:31105:1" rel="noopener">Haier Smart Home Co Ltd (6690 HK)</a>, <a href="https://www.smartkarma.com/entities/wuxi-apptec-co-ltd-bf4a1265-beef-48b6-b82d-29308426030f" target="_blank" data-smartkarma-citation="entities:27795:1" rel="noopener">WuXi AppTec Co. Ltd. (2359 HK)</a> and <a href="https://www.smartkarma.com/entities/aia-group-ltd" target="_blank" data-smartkarma-citation="entities:14895:1" rel="noopener">AIA Group Ltd (1299 HK)</a>. Shorts increased in Communication Services, Information Technology and Materials stocks, while decreasing in Utilities, Consumer Staples, Energy, Consumer Discretionary and Health Care stocks.</p></div><div><p>In Japan, stocks that saw the most shorts were <a href="https://www.smartkarma.com/entities/seven-i-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:1041:1" rel="noopener">Seven &amp; I Holdings (3382 JP)</a>, <a href="https://www.smartkarma.com/entities/toshiba-corp" target="_blank" data-smartkarma-citation="entities:637:1" rel="noopener">Toshiba Corp (6502 JP)</a>, <a href="https://www.smartkarma.com/entities/monex-group-inc" target="_blank" data-smartkarma-citation="entities:14211:1" rel="noopener">Monex Group Inc (8698 JP)</a> and <a href="https://www.smartkarma.com/entities/nihon-m-a-center-inc" target="_blank" data-smartkarma-citation="entities:17616:1" rel="noopener">Nihon M&amp;A Center (2127 JP)</a> while shorts decreased on <a href="https://www.smartkarma.com/entities/rakuten-inc" target="_blank" data-smartkarma-citation="entities:31:1" rel="noopener">Rakuten Inc (4755 JP)</a>, <a href="https://www.smartkarma.com/entities/fast-retailing-co-ltd" target="_blank" data-smartkarma-citation="entities:751:1" rel="noopener">Fast Retailing (9983 JP)</a>, <a href="https://www.smartkarma.com/entities/itochu-corp" target="_blank" data-smartkarma-citation="entities:18448:1" rel="noopener">Itochu Corp (8001 JP)</a> and <a href="https://www.smartkarma.com/entities/rohm-co-ltd" target="_blank" data-smartkarma-citation="entities:2953:1" rel="noopener">ROHM Co Ltd (6963 JP)</a>. Shorts increased in Consumer Staples, Industrials, Financials and Materials, while shorts covered in the Consumer Discretionary sector.</p></div><div><p>In Korea, short increased on <a href="https://www.smartkarma.com/entities/doosan-infracore-co-ltd" target="_blank" data-smartkarma-citation="entities:3982:1" rel="noopener">Doosan Infracore (042670 KS)</a>, <a href="https://www.smartkarma.com/entities/lotte-chemical-corp" target="_blank" data-smartkarma-citation="entities:8757:1" rel="noopener">Lotte Chemical (011170 KS)</a>, <a href="https://www.smartkarma.com/entities/posco-chemical-co-ltd" target="_blank" data-smartkarma-citation="entities:12421:1" rel="noopener">Posco Chemical Co Ltd (003670 KS)</a> and <a href="https://www.smartkarma.com/entities/hyundai-motor-co" target="_blank" data-smartkarma-citation="entities:155:1" rel="noopener">Hyundai Motor Co (005380 KS)</a> while shorts decreased on <a href="https://www.smartkarma.com/entities/sk-hynix-inc" target="_blank" data-smartkarma-citation="entities:16955:1" rel="noopener">SK Hynix (000660 KS)</a>, <a href="https://www.smartkarma.com/entities/celltrion-inc" target="_blank" data-smartkarma-citation="entities:991:1" rel="noopener">Celltrion Inc (068270 KS)</a>, <a href="https://www.smartkarma.com/entities/korea-electric-power-corp" target="_blank" data-smartkarma-citation="entities:16:1" rel="noopener">Korea Electric Power (015760 KS)</a> and <a href="https://www.smartkarma.com/entities/lg-display-co-ltd" target="_blank" data-smartkarma-citation="entities:7145:1" rel="noopener">LG Display (034220 KS)</a>. </p></div><div><p>Stocks in Taiwan that saw the highest increase in shorts were <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/pegatron-corp" target="_blank" data-smartkarma-citation="entities:12852:1" rel="noopener">Pegatron Corp (4938 TT)</a>, <a href="https://www.smartkarma.com/entities/fitipower-integrated-tech" target="_blank" data-smartkarma-citation="entities:8712:1" rel="noopener">Fitipower Integrated Tech (4961 TT)</a> and <a href="https://www.smartkarma.com/entities/walsin-technology-corp" target="_blank" data-smartkarma-citation="entities:11084:1" rel="noopener">Walsin Technology (2492 TT)</a> while shorts were covered on <a href="https://www.smartkarma.com/entities/taiwan-cement" target="_blank" data-smartkarma-citation="entities:19736:1" rel="noopener">Taiwan Cement (1101 TT)</a>, <a href="https://www.smartkarma.com/entities/evergreen-marine-corp-ltd" target="_blank" data-smartkarma-citation="entities:15428:1" rel="noopener">Evergreen Marine Corp (2603 TT)</a>, <a href="https://www.smartkarma.com/entities/innolux-corp" target="_blank" data-smartkarma-citation="entities:4509:1" rel="noopener">Innolux Corp (3481 TT)</a> and <a href="https://www.smartkarma.com/entities/richwave-technology-corp" target="_blank" data-smartkarma-citation="entities:18629:1" rel="noopener">Richwave Technology (4968 TT)</a>.</p></div>

The Asia Short Interest weekly looks at moves in market wide short interest and highlights movements in stock specific short interest across Hong Kong, Japan, Korea and Taiwan using the last available data published by the relevant authorities.Hong Kong saw shorts rise on Xinyi Solar Holdings (968 HK), Lenovo (992 HK), Ping An Insurance (H) (2318 HK), Kuaishou Technology (1024 HK) and JD Health (6618 HK) while there was short covering on Alibaba Group (9988 HK), Xiaomi Corp (1810 HK), Haier Smart Home Co Ltd (6690 HK), WuXi AppTec Co. Ltd. (2359 HK) and AIA Group Ltd (1299 HK). Shorts increased in Communication Services, Information Technology and Materials stocks, while decreasing in Utilities, Consumer Staples, Energy, Consumer Discretionary and Health Care stocks.In Japan, stocks that saw the most shorts were Seven &amp; I Holdings (3382 JP), Toshiba Corp (6502 JP), Monex Group Inc (8698 JP) and Nihon M&amp;A Center (2127 JP) while shorts decreased on Rakuten Inc (4755 JP), Fast Retailing (9983 JP), Itochu Corp (8001 JP) and ROHM Co Ltd (6963 JP). Shorts increased in Consumer Staples, Industrials, Financials and Materials, while shorts covered in the Consumer Discretionary sector.In Korea, short increased on Doosan Infracore (042670 KS), Lotte Chemical (011170 KS), Posco Chemical Co Ltd (003670 KS) and Hyundai Motor Co (005380 KS) while shorts decreased on SK Hynix (000660 KS), Celltrion Inc (068270 KS), Korea Electric Power (015760 KS) and LG Display (034220 KS). Stocks in Taiwan that saw the highest increase in shorts were TSMC (2330 TT), Pegatron Corp (4938 TT), Fitipower Integrated Tech (4961 TT) and Walsin Technology (2492 TT) while shorts were covered on Taiwan Cement (1101 TT), Evergreen Marine Corp (2603 TT), Innolux Corp (3481 TT) and Richwave Technology (4968 TT).

Asia Short Interest: Kuaishou, JD Health, Xiaomi, 7&I, Monex, Rakuten, Hynix, Hyundai, Fitipower

South Korea

Hyundai Elevator Co., Ltd. (HELCO) manufactures, installs, sells, and services elevators, escalators, moving walkways, automated parking systems, and material handling systems.  The Company also produces screen doors used on platforms in train stations.

HSD Engine Co., Ltd. is an integrated engine manufacturer specializing in producing diesel engine for large vessels. The Company provides business in diesel power plant construction and operation, engine parts sales, and engine maintenance and repair services.

People and Technology INC is a company manufacturing in Secondary Battery and Semiconductors.

STX Heavy Industries Co., Ltd. manufactures diesel engine components for ships. The Company's products include crank shafts, cylinder liners, turbo chargers, and cargo pumps.

Dawonsys Co., LTD. operates special power generating business such as Nuclear Fusion, Inductiral Electric and Plasma Power business. The Company also operates Inductive Heating and ESD Polyimide Film Business.

Sejin Heavy Industries Co. Ltd., operates a shipbuilding firm.  The Company manufactures ship components such as Deck House and Liquified Petroleum Gas (LPG) Tank.

Sejin Heavy Industries Co Ltd (075580 KS)

STX Engine Co., Ltd. develops and manufactures marine diesel engine and military engine.  The Company also manufactures electronic communication equipment.

Taewoong Co., Ltd. manufactures forged products required for heavy industry, such as shipbuilding, petrochemical plant use, and industrial machinery use. The Company's products include flanges, tube sheets, rings, shafts, and piston rods.

Hy-Lok Corporation develops, manufactures, and markets precision fittings and valves used in the petrochemical, semiconductor, and power generation industries.  The Company's products include needle valves, manifolds and gauge valves, filters, tube fittings, and pipe fittings.  In addition, Hy-Lok produces parts and components used in the plumbing market.

TK Corp. manufactures and markets piping materials used in the petrochemical, and shipbuilding industries.  The Company's products include pipe reducers, elbow tee reducers, and steel flanges.  TK also produces fittings and valves for semiconductors.

TADANO LTD. manufactures and sells various types of hydraulic cranes for construction and other industrial use.  The Company, through utilizing its own mechatronics technology, develops truck, all-terrain, and cargo cranes as well as non-crane equipment such as aerial platform trucks and lighting vehicles. The Company also manufactures pneumatic devices.

TriMas Corporation is a diversified manufacturer of proprietary products. The Company manufactures trailer products, recreational accessories, packaging systems, energy products and industrial specialty products for the commercial, manufacturing, and consumer markets.

Mitsui E&S Holdings Co., Ltd. engineers, builds, and repairs ships.  The Company also manufactures industrial machinery and equipment and builds power plants.  Mitsui Engineering & Shipbuilding also operates information systems services and real estate business.

Yunnan Xiyi Industry Co Ltd develops, manufactures and distributes connecting rods for automobile engines and other automobile parts including castings and forge pieces.

NTN CORPORATION manufactures a variety of bearings and machinery parts for industrial use.  The Company's products include bearings for office automation equipment, bearings, hubs, and joints for automobile engines, drive-train, suspension, and transmissions, clutch-related products, and precision machinery. NTN has sales networks in Japan and overseas.

Wabash National Corporation manufactures semi trailers in North America. The company specializes in the design and production of dry freight vans, refrigerated vans, flatbed trailers, drop deck trailers, dump trailers, truck bodies and intermodal equipment.

Makino Milling Machine Co., Ltd. manufactures, sells, and repairs machining centers (MCs), electrical dischargers, numerical control (NC) milling machines, and other related industrial machinery.  The Company also produces die/mold manufacturing systems as well as Computer Aided Manufacturing (CAM) and Computer Aided Design (CAD) systems software to support its machine tools.

Namura Shipbuilding Co., Ltd. is a manufacturer of cargo vessels, tankers, and steel structures such as bridges and floodgates.  The Company also leases, repairs, and provides maintenance services.  As a group, Namura Shipbuilding operates a variety of businesses including software development, information systems sales, precision coil manufacturing, and catering and security services.

Shuangliang Eco-Energy Systems Company Ltd. manufactures air conditioning products.  The Company produces flue gas lithium bromide absorption chillers, lithium bromide heat pump chillers, silicon gel absorption chillers, heat exchangers, and direct air cooled condensers.  Shuangliang Eco-Energy also manufactures sea water desalination equipment.

Shuangliang Eco Energy Systems (600481 CH)

Qinchuan Machine Tool & Tool Group Co. Ltd. manufactures and distributes numerical control machine tools and complex cutting tools. The Company produces cylindrical grinders, gear grinding machines, gear cutting tools, thread cutters, and measuring equipment. Qinchuan Machine Tool & Tool Group markets its products worldwide.

Qinchuan Mchn Tool & Tool Gp Shre (000837 CH)

Hyundai Doosan Infracore Co., Ltd. produces construction machinery. The Company manufactures construction equipment, industrial vehicles, diesel engines, power generators, machine tools, factory automation system, and other products, such as armored vehicles for the defense industry. Hyundai Doosan Infracore markets its products worldwide.

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HD Hyundai Infracore (042670 KS)

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