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/alibaba-group" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba Group (9988 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>, <a href="https://www.smartkarma.com/entities/country-garden-services-holdings-company-limited" target="_blank" data-smartkarma-citation="entities:27343:1" rel="noopener">Country Garden Services Holdings (6098 HK)</a> and <a href="https://www.smartkarma.com/entities/chow-tai-fook-jewellery-group" target="_blank" data-smartkarma-citation="entities:549:1" rel="noopener">Chow Tai Fook Jewellery (1929 HK)</a> while there was short covering on <a href="https://www.smartkarma.com/entities/ind-comm-bk-of-china-h" target="_blank" data-smartkarma-citation="entities:1119:1" rel="noopener">ICBC (H) (1398 HK)</a>, <a href="https://www.smartkarma.com/entities/asm-pacific-technology-ltd" target="_blank" data-smartkarma-citation="entities:15061:1" rel="noopener">ASM Pacific Technology (522 HK)</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/pccw-ltd" target="_blank" data-smartkarma-citation="entities:873:1" rel="noopener">PCCW Ltd (8 HK)</a> and <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>. Shorts increased in the Consumer Discretionary and Industrials sectors, while decreasing in Financials, Information Technology, Energy and Real Estate.</p></div><div><p>In Japan, stocks increased on <a href="https://www.smartkarma.com/entities/pharma-foods-international" target="_blank" data-smartkarma-citation="entities:10530:1" rel="noopener">Pharma Foods International (2929 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>, <a href="https://www.smartkarma.com/entities/nippon-yusen-kk" target="_blank" data-smartkarma-citation="entities:12285:1" rel="noopener">Nippon Yusen Kk (9101 JP)</a>, <a href="https://www.smartkarma.com/entities/ebara-corp" target="_blank" data-smartkarma-citation="entities:4728:1" rel="noopener">Ebara Corp (6361 JP)</a> and <a href="https://www.smartkarma.com/entities/skylark-co-ltd" target="_blank" data-smartkarma-citation="entities:474:1" rel="noopener">Skylark Co Ltd (3197 JP)</a> while there was short covering on <a href="https://www.smartkarma.com/entities/kyushu-railway-company" target="_blank" data-smartkarma-citation="entities:23609:1" rel="noopener">Kyushu Railway Company (9142 JP)</a>, <a href="https://www.smartkarma.com/entities/marui-group-co-ltd" target="_blank" data-smartkarma-citation="entities:13604:1" rel="noopener">Marui Group (8252 JP)</a>, <a href="https://www.smartkarma.com/entities/chugoku-electric-power-co" target="_blank" data-smartkarma-citation="entities:16243:1" rel="noopener">Chugoku Electric Power Co (9504 JP)</a>, <a href="https://www.smartkarma.com/entities/keihan-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:6120:1" rel="noopener">Keihan Holdings Co., Ltd. (9045 JP)</a> and <a href="https://www.smartkarma.com/entities/canon-inc" target="_blank" data-smartkarma-citation="entities:1:1" rel="noopener">Canon Inc (7751 JP)</a>. Shorts decreased in almost all sectors led by Industrials, Materials, Consumer Discretionary, Financials and Consumer Staples.</p></div><div><p>In Korea, shorts increased on <a href="https://www.smartkarma.com/entities/hmm-co-ltd" target="_blank" data-smartkarma-citation="entities:13494:1" rel="noopener">HMM Co., Ltd. (011200 KS)</a>, <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>, <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/posco-chemical-co-ltd" target="_blank" data-smartkarma-citation="entities:12421:1" rel="noopener">Posco Chemical Co Ltd (003670 KS)</a> while shorts were covered on <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>, <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/sk-hynix-inc" target="_blank" data-smartkarma-citation="entities:16955:1" rel="noopener">SK Hynix (000660 KS)</a> and <a href="https://www.smartkarma.com/entities/naver-corp" target="_blank" data-smartkarma-citation="entities:16029:1" rel="noopener">Naver Corp (035420 KS)</a>.</p></div><div><p>In Taiwan, shorts increased on <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>, <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/innolux-corp" target="_blank" data-smartkarma-citation="entities:4509:1" rel="noopener">Innolux Corp (3481 TT)</a>, <a href="https://www.smartkarma.com/entities/yang-ming-marine-transport" target="_blank" data-smartkarma-citation="entities:8502:1" rel="noopener">Yang Ming Marine Transport (2609 TT)</a> and <a href="https://www.smartkarma.com/entities/hannstar-display-corp" target="_blank" data-smartkarma-citation="entities:13922:1" rel="noopener">Hannstar Display (6116 TT)</a> while shorts covered on <a href="https://www.smartkarma.com/entities/chicony-electronics-co-ltd" target="_blank" data-smartkarma-citation="entities:13085:1" rel="noopener">Chicony Electronics (2385 TT)</a>, <a href="https://www.smartkarma.com/entities/chunghwa-telecom-co-ltd" target="_blank" data-smartkarma-citation="entities:9181:1" rel="noopener">Chunghwa Telecom (2412 TT)</a>, <a href="https://www.smartkarma.com/entities/highwealth-construction-corp" target="_blank" data-smartkarma-citation="entities:6739:1" rel="noopener">Highwealth Construction (2542 TT)</a>, <a href="https://www.smartkarma.com/entities/mediatek-inc" target="_blank" data-smartkarma-citation="entities:772:1" rel="noopener">Mediatek Inc (2454 TT)</a> and <a href="https://www.smartkarma.com/entities/quanta-computer-inc" target="_blank" data-smartkarma-citation="entities:2754:1" rel="noopener">Quanta Computer (2382 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 Alibaba Group (9988 HK), Ping An Insurance (H) (2318 HK)Kuaishou Technology (1024 HK), Country Garden Services Holdings (6098 HK) and Chow Tai Fook Jewellery (1929 HK) while there was short covering on ICBC (H) (1398 HK), ASM Pacific Technology (522 HK), Tencent (700 HK), PCCW Ltd (8 HK) and Sunny Optical (2382 HK). Shorts increased in the Consumer Discretionary and Industrials sectors, while decreasing in Financials, Information Technology, Energy and Real Estate.In Japan, stocks increased on Pharma Foods International (2929 JP), CyberAgent Inc (4751 JP), Nippon Yusen Kk (9101 JP), Ebara Corp (6361 JP) and Skylark Co Ltd (3197 JP) while there was short covering on Kyushu Railway Company (9142 JP), Marui Group (8252 JP), Chugoku Electric Power Co (9504 JP), Keihan Holdings Co., Ltd. (9045 JP) and Canon Inc (7751 JP). Shorts decreased in almost all sectors led by Industrials, Materials, Consumer Discretionary, Financials and Consumer Staples.In Korea, shorts increased on HMM Co., Ltd. (011200 KS), Doosan Heavy Industries &amp; Construction (034020 KS), LG Chem Ltd (051910 KS) and Posco Chemical Co Ltd (003670 KS) while shorts were covered on Hyundai Motor Co (005380 KS), Samsung Electronics (005930 KS), SK Hynix (000660 KS) and Naver Corp (035420 KS).In Taiwan, shorts increased on AU Optronics (2409 TT), Yageo Corporation (2327 TT), Innolux Corp (3481 TT), Yang Ming Marine Transport (2609 TT) and Hannstar Display (6116 TT) while shorts covered on Chicony Electronics (2385 TT), Chunghwa Telecom (2412 TT), Highwealth Construction (2542 TT), Mediatek Inc (2454 TT) and Quanta Computer (2382 TT).

Asia Shorts: CGS, CTF, ASM Pac, PCCW, KyushuRail, Marui, HMM, Doosan, LG Chem, HMC, Yang Ming

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Thematic (Sector/Industry)

<div class="content-highlight">
<p>Nuclear power has been the best performing sector in the Korean stock market so far in 2021. The table below shows 8 major nuclear power related stocks in Korea which are up on average 94.8% YTD, crushing the overall market. However, among these 8 stocks, only three have market caps of more than 2 trillion won, including DHIC, KEPCO E&amp;C, and KEPCO KPS. These three stocks are up on average 122% YTD.</p>
<p>There have been three major drivers of the strong outperformance of nuclear power related plays in Korea this year:</p>
<ul>
<li><strong>Gates &amp; Buffett launching <a href="https://thehill.com/changing-america/sustainability/energy/556702-bill-gates-and-warren-buffett-building-nuclear-reactor" target="_blank" rel="noopener">Natrium nuclear power plant</a> in Wyoming</strong></li>
<li><strong>A partnership between the US and Korean governments to expand nuclear power</strong></li>
<li><strong>Conservative party candidate (Yoon Seok-Youl) is winning in the Presidential election polls</strong></li>
</ul>
</div><table class="table table-striped">
<colgroup>
<col>
<col>
<col>
<col>
<col>
</colgroup>
<tbody>
<tr>
<td colspan="2" style="width: 264.49px;"><strong>Major Nuclear Related Stocks in Korea (Share Price Performance YTD)</strong></td>
<td style="width: 78.66px;"></td>
<td style="width: 65.33px;"></td>
<td style="width: 64px;"></td>
</tr>
<tr>
<td style="width: 148.95px;"><strong>Companies</strong></td>
<td style="text-align: center; width: 94.54px;"><strong>Market Cap (Won bn); 6/4/2021</strong></td>
<td style="text-align: center; width: 78.66px;"><strong>Price (Won); 6/4/2021</strong></td>
<td style="text-align: center; width: 65.33px;"><strong>Price (Won); 12/31/2020</strong></td>
<td style="text-align: center; width: 64px;"><strong>% Change YTD</strong></td>
</tr>
<tr>
<td style="width: 148.95px;"><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></td>
<td style="text-align: center; width: 94.54px;">10,604</td>
<td style="text-align: center; width: 78.66px;">25,100</td>
<td style="text-align: center; width: 65.33px;">13,500</td>
<td style="text-align: center; width: 64px;">85.9%</td>
</tr>
<tr>
<td style="width: 148.95px;"><a href="https://www.smartkarma.com/entities/kepco-engineering-construction" target="_blank" data-smartkarma-citation="entities:10831:1" rel="noopener">Kepco Engineering &amp; Construction (052690 KS) </a></td>
<td style="text-align: center; width: 94.54px;">2,217</td>
<td style="text-align: center; width: 78.66px;">58,000</td>
<td style="text-align: center; width: 65.33px;">17,850</td>
<td style="text-align: center; width: 64px;">224.9%</td>
</tr>
<tr>
<td style="width: 148.95px;"><a href="https://www.smartkarma.com/entities/kepco-plant-service-engineering" target="_blank" data-smartkarma-citation="entities:10730:1" rel="noopener">Kepco Plant Service &amp; Engineering (051600 KS) </a></td>
<td style="text-align: center; width: 94.54px;">2,090</td>
<td style="text-align: center; width: 78.66px;">46,450</td>
<td style="text-align: center; width: 65.33px;">29,700</td>
<td style="text-align: center; width: 64px;">56.4%</td>
</tr>
<tr>
<td style="width: 148.95px;">Huvis (079980 KS)</td>
<td style="text-align: center; width: 94.54px;">366</td>
<td style="text-align: center; width: 78.66px;">10,600</td>
<td style="text-align: center; width: 65.33px;">8,240</td>
<td style="text-align: center; width: 64px;">28.6%</td>
</tr>
<tr>
<td style="width: 148.95px;"><a href="https://www.smartkarma.com/entities/orbitech-co-ltd" target="_blank" data-smartkarma-citation="entities:1201:1" rel="noopener">Orbitech Co Ltd (046120 KS)</a></td>
<td style="text-align: center; width: 94.54px;">233</td>
<td style="text-align: center; width: 78.66px;">9,330</td>
<td style="text-align: center; width: 65.33px;">4,480</td>
<td style="text-align: center; width: 64px;">108.3%</td>
</tr>
<tr>
<td style="width: 148.95px;">Woori Tech (032820 KS)</td>
<td style="text-align: center; width: 94.54px;">232</td>
<td style="text-align: center; width: 78.66px;">1,790</td>
<td style="text-align: center; width: 65.33px;">1,315</td>
<td style="text-align: center; width: 64px;">36.1%</td>
</tr>
<tr>
<td style="width: 148.95px;">Woojin (105840 KS)</td>
<td style="text-align: center; width: 94.54px;">168</td>
<td style="text-align: center; width: 78.66px;">8,280</td>
<td style="text-align: center; width: 65.33px;">4,395</td>
<td style="text-align: center; width: 64px;">88.4%</td>
</tr>
<tr>
<td style="width: 148.95px;"><a href="https://www.smartkarma.com/entities/bhi-co-ltd" target="_blank" data-smartkarma-citation="entities:20149:1" rel="noopener">Bhi Co Ltd (083650 KS) </a></td>
<td style="text-align: center; width: 94.54px;">153</td>
<td style="text-align: center; width: 78.66px;">5,900</td>
<td style="text-align: center; width: 65.33px;">2,565</td>
<td style="text-align: center; width: 64px;">130.0%</td>
</tr>
<tr>
<td style="width: 148.95px;"><strong>Average</strong></td>
<td style="text-align: center; width: 94.54px;"></td>
<td style="text-align: center; width: 78.66px;"></td>
<td style="text-align: center; width: 65.33px;"></td>
<td style="text-align: center; width: 64px;"><strong>94.8%</strong></td>
</tr>
<tr>
<td style="width: 148.95px;">Source: Naver Finance</td>
<td style="width: 94.54px;"></td>
<td style="width: 78.66px;"></td>
<td style="width: 65.33px;"></td>
<td style="width: 64px;"></td>
</tr>
</tbody>
</table>


Nuclear power has been the best performing sector in the Korean stock market so far in 2021. The table below shows 8 major nuclear power related stocks in Korea which are up on average 94.8% YTD, crushing the overall market. However, among these 8 stocks, only three have market caps of more than 2 trillion won, including DHIC, KEPCO E&amp;C, and KEPCO KPS. These three stocks are up on average 122% YTD.
There have been three major drivers of the strong outperformance of nuclear power related plays in Korea this year:

Gates &amp; Buffett launching Natrium nuclear power plant in Wyoming
A partnership between the US and Korean governments to expand nuclear power
Conservative party candidate (Yoon Seok-Youl) is winning in the Presidential election polls











Major Nuclear Related Stocks in Korea (Share Price Performance YTD)





Companies
Market Cap (Won bn); 6/4/2021
Price (Won); 6/4/2021
Price (Won); 12/31/2020
% Change YTD


Doosan Heavy Industries &amp; Construction (034020 KS) 
10,604
25,100
13,500
85.9%


Kepco Engineering &amp; Construction (052690 KS) 
2,217
58,000
17,850
224.9%


Kepco Plant Service &amp; Engineering (051600 KS) 
2,090
46,450
29,700
56.4%


Huvis (079980 KS)
366
10,600
8,240
28.6%


Orbitech Co Ltd (046120 KS)
233
9,330
4,480
108.3%


Woori Tech (032820 KS)
232
1,790
1,315
36.1%


Woojin (105840 KS)
168
8,280
4,395
88.4%


Bhi Co Ltd (083650 KS) 
153
5,900
2,565
130.0%


Average



94.8%


Source: Naver Finance








Nuclear Power: The Best Performing Sector in the Korean Stock Market in 2021 - Why?

Event-Driven

<div class="content-highlight">
<p>We continue to have a positive view of Doosan Infracore. The fundamentals are improving significantly and the shorts need to cover more before the stock is suspended from trading on 29 June. The price ratio between Doosan Infracore/DHIC recently peaked on 12 May to 0.87 and has been declining since then to 0.66. So on a relative basis, we think that Doosan Infracore could outperform DHIC this month. </p>
<p>Over a longer view (1-2 years), DHIC can benefit from increased exports of SMR nuclear power and if the opposition party wins the Presidency in South Korea next March, this could also fuel higher demand for nuclear power in Korea which should benefit DHIC. Due to the sharp increase in its share price in the past few weeks, DHIC's shares could enter a correction in the near term, but we would not short it at current levels.</p>
<p>Certainly, many investors are betting against DHIC right now, especially in the past one month. However, we believe that the tides are turning big time for nuclear power (in both South Korea and for exports through SMR). DHIC has the best technology and expertise for nuclear power in South Korea and if there are greater demand for nuclear power for both exports as well as in Korea, DHIC would be the number one company to benefit from this trend. </p>
</div>


We continue to have a positive view of Doosan Infracore. The fundamentals are improving significantly and the shorts need to cover more before the stock is suspended from trading on 29 June. The price ratio between Doosan Infracore/DHIC recently peaked on 12 May to 0.87 and has been declining since then to 0.66. So on a relative basis, we think that Doosan Infracore could outperform DHIC this month. 
Over a longer view (1-2 years), DHIC can benefit from increased exports of SMR nuclear power and if the opposition party wins the Presidency in South Korea next March, this could also fuel higher demand for nuclear power in Korea which should benefit DHIC. Due to the sharp increase in its share price in the past few weeks, DHIC's shares could enter a correction in the near term, but we would not short it at current levels.
Certainly, many investors are betting against DHIC right now, especially in the past one month. However, we believe that the tides are turning big time for nuclear power (in both South Korea and for exports through SMR). DHIC has the best technology and expertise for nuclear power in South Korea and if there are greater demand for nuclear power for both exports as well as in Korea, DHIC would be the number one company to benefit from this trend. 


Declining Shorts for Doosan Infracore & A Big Jump in Shorts for Doosan Heavy Industries

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.

<p>Doosan Heavy Industries is up 15% today on the news that Korea and the US signed the business collaboration agreement for the SMR (Small Modular Reactor) cooperation. Doosan Heavy has been looking to export its SMRs to the US for a while.</p><p>Doosan Heavy's price surge leads to an extreme diversion in the price ratio vs. Doosan Corp. It is currently 2.43% off the 180-day mean: Doosan Corp in the numerator and Doosan Heavy in the denominator. The pair is 31.51% below the 180-day high.</p><table class="table table-striped">
<colgroup>
<col width="70">
<col width="70">
</colgroup>
<tbody>
<tr><td colspan="2" data-sheets-value='{"1":2,"2":"Doosan Corp"}' data-sheets-formula="=R[-110]C[-6]">Doosan Corp vs. Doosan Heavy Industries</td></tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Current price ratio"}'>Current price ratio</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":3.902869757174393}' data-sheets-numberformat='{"1":2,"2":"#,##0.00000","3":1}' data-sheets-formula='=indirect("$E"&amp;R159C[0])'>3.90287</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"%Δ to 180-day mean"}' data-sheets-numberformat='[null,4,"[$₩]#,##0"]'><strong>%Δ to 180-day mean</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":-0.024321120573437455}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula='=indirect("$B"&amp;R159C[0])'><strong>-2.43%</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"%Δ to 180-day high"}' data-sheets-numberformat='[null,4,"[$₩]#,##0"]'><strong>%Δ to 180-day high</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":-0.31509527938165255}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula='=indirect("$C"&amp;R159C[0])'><strong>-31.51%</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"%Δ to 180-day low"}' data-sheets-numberformat='[null,4,"[$₩]#,##0"]'>%Δ to 180-day low</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.32239356345043796}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula='=indirect("$D"&amp;R159C[0])'>32.24%</td>
</tr>
<tr><td colspan="2" data-sheets-value='{"1":2,"2":"Source: KRX"}'>Source: KRX</td></tr>
</tbody>
</table><section class="figure"><p>The current sigma on a 20-day moving average is -2.59, putting the duo back to where there were a month ago. </p>
<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/210/698/original/Doosan+Corp+vs.+Doosan+Heavy+Industries+Constrctn+Co+Ltd.png?1622610836" class="editor-image img-responsive" data-smartkarma-image-id="210698"></figure></section><p>Doosan Corp is basically a single-subsidiary holding company with a substantial presence of its own operating operation. But Doosan Heavy alone accounts for nearly 70% of the GAV, making them a suitable pair for a stub trade.</p><table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr>
<td style="width: 229.091px;" data-sheets-value='{"1":2,"2":"Assets"}'>Assets</td>
<td style="text-align: right; width: 225.455px;" data-sheets-value='{"1":2,"2":"% of NAV"}'>% of NAV</td>
<td style="text-align: right; width: 227.273px;" data-sheets-value='{"1":2,"2":"% of GAV"}'>% of GAV</td>
</tr>
<tr>
<td style="width: 229.091px;" data-sheets-value='{"1":2,"2":"Doosan Heavy Industries Constrctn Co Ltd"}' data-sheets-formula="=NAV!R[11]C[0]"><strong>Doosan Heavy Industries Constrctn Co Ltd</strong></td>
<td style="text-align: right; width: 225.455px;" data-sheets-value='{"1":3,"3":0.9151962366131203}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[11]C[2]/R28C[0]"><strong>91.52%</strong></td>
<td style="text-align: right; width: 227.273px;" data-sheets-value='{"1":3,"3":0.6808923434006716}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[11]C[1]/R23C[-1]"><strong>68.09%</strong></td>
</tr>
<tr>
<td style="width: 229.091px;" data-sheets-value='{"1":2,"2":"Oricom Inc"}' data-sheets-formula="=NAV!R[11]C[0]">Oricom Inc</td>
<td style="text-align: right; width: 225.455px;" data-sheets-value='{"1":3,"3":0.011680247052466503}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[11]C[2]/R28C[0]">1.17%</td>
<td style="text-align: right; width: 227.273px;" data-sheets-value='{"1":3,"3":0.00868992951335164}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[11]C[1]/R23C[-1]">0.87%</td>
</tr>
<tr>
<td style="width: 229.091px;" data-sheets-value='{"1":2,"2":"Infinitt Healthcare Co Ltd"}' data-sheets-formula="=NAV!R[11]C[0]">Infinitt Healthcare Co Ltd</td>
<td style="text-align: right; width: 225.455px;" data-sheets-value='{"1":3,"3":0.000027824626946200257}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[11]C[2]/R28C[0]">0.00%</td>
<td style="text-align: right; width: 227.273px;" data-sheets-value='{"1":3,"3":0.00002070110724641955}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[11]C[1]/R23C[-1]">0.00%</td>
</tr>
<tr>
<td style="width: 229.091px;" data-sheets-value='{"1":2,"2":"Solus Advanced Materials 1P"}' data-sheets-formula="=NAV!R[11]C[0]">Solus Advanced Materials 1P</td>
<td style="text-align: right; width: 225.455px;" data-sheets-value='{"1":3,"3":0.029027529178169444}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[11]C[2]/R28C[0]">2.90%</td>
<td style="text-align: right; width: 227.273px;" data-sheets-value='{"1":3,"3":0.02159604855719073}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[11]C[1]/R23C[-1]">2.16%</td>
</tr>
<tr>
<td style="width: 229.091px;" data-sheets-value='{"1":2,"2":"Other - unlisted"}' data-sheets-formula="=NAV!R[11]C[0]">Other - unlisted</td>
<td style="text-align: right; width: 225.455px;" data-sheets-value='{"1":3,"3":0.13198779914059305}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[11]C[2]/R28C[0]">13.20%</td>
<td style="text-align: right; width: 227.273px;" data-sheets-value='{"1":3,"3":0.09819695302694514}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[11]C[1]/R23C[-1]">9.82%</td>
</tr>
<tr>
<td style="width: 229.091px;" data-sheets-value='{"1":2,"2":"Operation"}' data-sheets-formula="=NAV!R[25]C[0]"><strong>Operation</strong></td>
<td style="text-align: right; width: 225.455px;" data-sheets-value='{"1":3,"3":0.25619334319140497}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[25]C[2]/R28C[0]"><strong>25.62%</strong></td>
<td style="text-align: right; width: 227.273px;" data-sheets-value='{"1":3,"3":0.19060402439459445}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[25]C[1]/R23C[-1]"><strong>19.06%</strong></td>
</tr>
<tr>
<td style="width: 229.091px;" data-sheets-value='{"1":2,"2":"Holdco net cash/debt (de-consolidated)"}' data-sheets-formula="=NAV!R[25]C[0]">Holdco net cash/debt (de-consolidated)</td>
<td style="text-align: right; width: 225.455px;" data-sheets-value='{"1":3,"3":-0.2705439344996471}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[25]C[2]/R28C[0]">-27.05%</td>
<td style="text-align: right; width: 227.273px;" data-sheets-value='{"1":2,"2":"-"}' data-sheets-numberformat='[null,3,"0.00%",1]'>-</td>
</tr>
<tr>
<td style="width: 229.091px;" data-sheets-value='{"1":2,"2":"Value of pref shares"}' data-sheets-formula="=NAV!R[-14]C[0]">Value of pref shares</td>
<td style="text-align: right; width: 225.455px;" data-sheets-value='{"1":3,"3":-0.07356904530305353}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=-R[-14]C[0]/R28C[0]">-7.36%</td>
<td style="text-align: right; width: 227.273px;" data-sheets-value='{"1":2,"2":"-"}' data-sheets-numberformat='[null,3,"0.00%",1]'>-</td>
</tr>
<tr><td colspan="3" style="width: 723.636px;">Source: DART &amp; KRX</td></tr>
</tbody>
</table><p>Doosan Corp controls 41.95% of Doosan Heavy Industries, translating into a ₩3.85T market value.</p><table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr>
<td style="width: 242.727px;" data-sheets-value='{"1":2,"2":"Holdings"}'>Holdings</td>
<td style="text-align: right; width: 148.182px;" data-sheets-value='{"1":2,"2":"Ticker"}'>Ticker</td>
<td style="text-align: right; width: 122.727px;" data-sheets-value='{"1":2,"2":"Stake"}'>Stake</td>
<td style="text-align: right; width: 147.273px;" data-sheets-value='{"1":2,"2":"Value"}'>Value</td>
</tr>
<tr>
<td style="width: 242.727px;" data-sheets-value='{"1":2,"2":"Doosan Heavy Industries Constrctn Co Ltd"}' data-sheets-formula="=NAV!R[10]C[0]"><strong>Doosan Heavy Industries Constrctn Co Ltd</strong></td>
<td style="text-align: right; width: 148.182px;" data-sheets-value='{"1":2,"2":"034020"}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=NAV!R[10]C[0]"><strong>034020</strong></td>
<td style="text-align: right; width: 122.727px;" data-sheets-value='{"1":3,"3":0.41950000000000004}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=NAV!R[10]C[0]"><strong>41.95%</strong></td>
<td style="text-align: right; width: 147.273px;" data-sheets-value='{"1":3,"3":3854.7747096210005}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]' data-sheets-formula="=NAV!R[10]C[0]"><strong>₩3,854.8B</strong></td>
</tr>
<tr>
<td style="width: 242.727px;" data-sheets-value='{"1":2,"2":"Oricom Inc"}' data-sheets-formula="=NAV!R[10]C[0]">Oricom Inc</td>
<td style="text-align: right; width: 148.182px;" data-sheets-value='{"1":2,"2":"010470"}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=NAV!R[10]C[0]">010470</td>
<td style="text-align: right; width: 122.727px;" data-sheets-value='{"1":3,"3":0.6154999999999999}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=NAV!R[10]C[0]">61.55%</td>
<td style="text-align: right; width: 147.273px;" data-sheets-value='{"1":3,"3":49.50336598724999}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]' data-sheets-formula="=NAV!R[10]C[0]">₩49.5B</td>
</tr>
<tr>
<td style="width: 242.727px;" data-sheets-value='{"1":2,"2":"Infinitt Healthcare Co Ltd"}' data-sheets-formula="=NAV!R[10]C[0]">Infinitt Healthcare Co Ltd</td>
<td style="text-align: right; width: 148.182px;" data-sheets-value='{"1":2,"2":"071200"}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=NAV!R[10]C[0]">071200</td>
<td style="text-align: right; width: 122.727px;" data-sheets-value='{"1":3,"3":0.0006}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=NAV!R[10]C[0]">0.06%</td>
<td style="text-align: right; width: 147.273px;" data-sheets-value='{"1":3,"3":0.11827402838399999}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]' data-sheets-formula="=NAV!R[10]C[0]">₩0.1B</td>
</tr>
<tr>
<td style="width: 242.727px;" data-sheets-value='{"1":2,"2":"Solus Advanced Materials 1P"}' data-sheets-formula="=NAV!R[10]C[0]">Solus Advanced Materials 1P</td>
<td style="text-align: right; width: 148.182px;" data-sheets-value='{"1":2,"2":"33637K"}' data-sheets-numberformat='[null,2,"#,##0",1]' data-sheets-formula="=NAV!R[10]C[0]">33637K</td>
<td style="text-align: right; width: 122.727px;" data-sheets-value='{"1":3,"3":0.028399999999999998}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=NAV!R[10]C[0]">2.84%</td>
<td style="text-align: right; width: 147.273px;" data-sheets-value='{"1":3,"3":123.01888}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]' data-sheets-formula="=NAV!R[10]C[0]">₩123.0B</td>
</tr>
<tr>
<td style="width: 242.727px;" data-sheets-value='{"1":2,"2":"Other - unlisted"}' data-sheets-formula="=NAV!R[13]C[0]">Other - unlisted</td>
<td style="text-align: right; width: 148.182px;" data-sheets-value='{"1":2,"2":"-"}' data-sheets-numberformat='[null,2,"#,##0",1]'>-</td>
<td style="text-align: right; width: 122.727px;" data-sheets-value='{"1":2,"2":"-"}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=NAV!R[13]C[0]">-</td>
<td style="text-align: right; width: 147.273px;" data-sheets-value='{"1":3,"3":561.04}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]' data-sheets-formula="=NAV!R[13]C[0]">₩561.0B</td>
</tr>
<tr><td colspan="4" style="width: 723.636px;" data-sheets-value='{"1":2,"2":"Source: KRX &amp; DART"}'>Source: KRX &amp; DART</td></tr>
</tbody>
</table>

Doosan Heavy Industries is up 15% today on the news that Korea and the US signed the business collaboration agreement for the SMR (Small Modular Reactor) cooperation. Doosan Heavy has been looking to export its SMRs to the US for a while.Doosan Heavy's price surge leads to an extreme diversion in the price ratio vs. Doosan Corp. It is currently 2.43% off the 180-day mean: Doosan Corp in the numerator and Doosan Heavy in the denominator. The pair is 31.51% below the 180-day high.





Doosan Corp vs. Doosan Heavy Industries

Current price ratio
3.90287


%Δ to 180-day mean
-2.43%


%Δ to 180-day high
-31.51%


%Δ to 180-day low
32.24%

Source: KRX

The current sigma on a 20-day moving average is -2.59, putting the duo back to where there were a month ago. 
Doosan Corp is basically a single-subsidiary holding company with a substantial presence of its own operating operation. But Doosan Heavy alone accounts for nearly 70% of the GAV, making them a suitable pair for a stub trade.







Assets
% of NAV
% of GAV


Doosan Heavy Industries Constrctn Co Ltd
91.52%
68.09%


Oricom Inc
1.17%
0.87%


Infinitt Healthcare Co Ltd
0.00%
0.00%


Solus Advanced Materials 1P
2.90%
2.16%


Other - unlisted
13.20%
9.82%


Operation
25.62%
19.06%


Holdco net cash/debt (de-consolidated)
-27.05%
-


Value of pref shares
-7.36%
-

Source: DART &amp; KRX

Doosan Corp controls 41.95% of Doosan Heavy Industries, translating into a ₩3.85T market value.








Holdings
Ticker
Stake
Value


Doosan Heavy Industries Constrctn Co Ltd
034020
41.95%
₩3,854.8B


Oricom Inc
010470
61.55%
₩49.5B


Infinitt Healthcare Co Ltd
071200
0.06%
₩0.1B


Solus Advanced Materials 1P
33637K
2.84%
₩123.0B


Other - unlisted
-
-
₩561.0B

Source: KRX &amp; DART



Doosan Stub: An Entry Point in This Extreme Diversion

Cross Asset Strategy

<div class="content-highlight">
<p>On 28 May, Korea's National Pension Fund (NPS) announced its new <a href="https://news.mt.co.kr/mtview.php?no=2021052820172973220" target="_blank" rel="noopener">5 year plan</a> to reduce the asset allocation of Korean equities to 14.5% of total assets at the end of 2026, down from the current target of 16.8% of total assets at the end of 2021. NPS now is targeting overseas equity asset allocation targets to increase from 25.1% at the end of 2021 to 35.5% at the end of 2026.</p>
<p>NPS is targeting equity, fixed income and alternative assets to account for 50%, 35%, and 15% of total assets by the end of 2026. NPS has set an annual expected return of 5.1% for its total invested assets from 2021 to 2026.</p>
</div>


On 28 May, Korea's National Pension Fund (NPS) announced its new 5 year plan to reduce the asset allocation of Korean equities to 14.5% of total assets at the end of 2026, down from the current target of 16.8% of total assets at the end of 2021. NPS now is targeting overseas equity asset allocation targets to increase from 25.1% at the end of 2021 to 35.5% at the end of 2026.
NPS is targeting equity, fixed income and alternative assets to account for 50%, 35%, and 15% of total assets by the end of 2026. NPS has set an annual expected return of 5.1% for its total invested assets from 2021 to 2026.


NPS Announces A Reduction in Asset Allocation in Korean Equities to 14.5% of Assets by 2026

South Korea

Doosan Enerbility Co., Ltd. manufactures and distributes construction machines. The Company produces gas turbines, engines, turbine generators, boilers, power plant equipment, and other related products. Doosan Enerbility also offers energy solutions for thermal power, nuclear power, and renewable energy.

Price Gauge
52-week Range	0.00 - 0.00
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Doosan Enerbility (034020 KS)

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