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

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

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

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

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

Event-Driven Trades Across Asia Pacific

Event-Driven

<ul>
<li>The JPX Nikkei 400 index rebalance will take place on Wednesday, MSIC on Thursday and <a href="https://www.smartkarma.com/entities/hong-kong-hang-seng-index" target="_blank" data-smartkarma-citation="entities:22899:1" rel="noopener">HSI</a>, <a href="https://www.smartkarma.com/entities/hang-seng-china-enterprises-index" target="_blank" data-smartkarma-citation="entities:22900:1" rel="noopener">HSCEI</a>, <a href="https://www.smartkarma.com/entities/hang-seng-tech-index" target="_blank" data-smartkarma-citation="entities:31367:1" rel="noopener">HSTECH</a> and HSCI on Friday.</li>
<li>There are review cutoffs for the MVIS family of indices, and multiple announcements of changes to various indices during the week.</li>
<li>There were inflows to mainland China ETFs, <a href="https://www.smartkarma.com/entities/ishares-msci-india-etf" target="_blank" data-smartkarma-citation="entities:282:1" rel="noopener">iShares India ETF (INDA)</a>, <a href="https://www.smartkarma.com/entities/ishares-msci-india-small-cap" target="_blank" data-smartkarma-citation="entities:32064:1" rel="noopener">Ishares India Small-Cap (SMIN)</a> and <a href="https://www.smartkarma.com/entities/ishares-msci-emerging-markets-223f5da3-7054-4e4f-bc55-b7f0852c2581" target="_blank" data-smartkarma-citation="entities:31998:1" rel="noopener">iShares EmergingMarkets ex China (EMXC)</a> while there were outflows for <a href="https://www.smartkarma.com/entities/ishares-msci-emerging-markets" target="_blank" data-smartkarma-citation="entities:438:1" rel="noopener">iShares Emerging Markets (EEM)</a>.</li>
</ul>


The JPX Nikkei 400 index rebalance will take place on Wednesday, MSIC on Thursday and HSI, HSCEI, HSTECH and HSCI on Friday.
There are review cutoffs for the MVIS family of indices, and multiple announcements of changes to various indices during the week.
There were inflows to mainland China ETFs, iShares India ETF (INDA), Ishares India Small-Cap (SMIN) and iShares EmergingMarkets ex China (EMXC) while there were outflows for iShares Emerging Markets (EEM).


Index Rebalance & ETF Flow Recap: HSCEI, HSI, HSTECH, Yuanta ETFs, China ETFs, REMX, KOSPI

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

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

APM Human Services / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/apm-human-services-internation" target="_blank" data-smartkarma-citation="entities:34808:1" rel="noopener">APM Human Services (APM AU)</a> raised about US$730m by selling a mix of primary and secondary shares in Nov 21. The second IPO linked lockup is set to expire next week.</li>
<li>APM is an international human services provider, it runs 800 sites spanning 10 countries with its largest market being Australia.</li>
<li>In this note, we will talk about the lock-up dynamics and updates since our last note.</li>
</ul>



APM Human Services (APM AU) raised about US$730m by selling a mix of primary and secondary shares in Nov 21. The second IPO linked lockup is set to expire next week.
APM is an international human services provider, it runs 800 sites spanning 10 countries with its largest market being Australia.
In this note, we will talk about the lock-up dynamics and updates since our last note.


APM Human Services IPO Lock-Up - US$400m of Shares Come Free but First PE Needs to Clear Out

Overseas Chinese Equities, Aequitas Research

Ming Lu

Overseas Chinese Equities

Equity Bottom-Up

<ul>
<li>Total revenue grew by 33% YoY, which is the highest growth rate in the past seven quarters.</li>
<li>The company achieved a higher operating profit in 2Q23 after turned the profit positive in 1Q23.</li>
<li>The stock price has risen by 20% since our last buy rating, but we believe there will be still 38% upside for yearend 2024.</li>
</ul>


Total revenue grew by 33% YoY, which is the highest growth rate in the past seven quarters.
The company achieved a higher operating profit in 2Q23 after turned the profit positive in 1Q23.
The stock price has risen by 20% since our last buy rating, but we believe there will be still 38% upside for yearend 2024.


MT (Meituan 3690 HK): 2Q23, Record High Op Profit, 38% Buy

<ul>
<li>
<a href="https://www.smartkarma.com/entities/softbank-group-corp" target="_blank" data-smartkarma-citation="entities:315:1" rel="noopener">Softbank Group (9984 JP)</a> aims to raise around US$8-10bn via selling some of its stake in <a href="https://www.smartkarma.com/entities/arm-holdings-inc" target="_blank" data-smartkarma-citation="entities:21816:1" rel="noopener">ARM Holdings</a>’ US IPO.</li>
<li>ARM develops and licences high-performance, low-cost, and energy-efficient CPU products and related technology, which is used by semiconductor companies and OEMs to develop their own products.</li>
<li>In this note, we compare its recent performance versus its performance prior to its privatisation and discuss the changes since then.</li>
</ul>



Softbank Group (9984 JP) aims to raise around US$8-10bn via selling some of its stake in ARM Holdings’ US IPO.
ARM develops and licences high-performance, low-cost, and energy-efficient CPU products and related technology, which is used by semiconductor companies and OEMs to develop their own products.
In this note, we compare its recent performance versus its performance prior to its privatisation and discuss the changes since then.


ARM Holdings Pre-IPO - Pre-Privatisation to Pre-Listing Changes - Slower Growth, Lower Margins

Greater China Equity Long/Short Analyst

Eric Chen

<ul>
<li>Over the last decade, VIPShop proved it is the undisputed leader in China’s online discount retail business with the longest streak of profitability and impressive ROE among China internet names.</li>
<li>Investors are misplaced to look to the stock for growth. Rather, it is cash cow in mature business with deep moat and run by disciplined management who cares about shareholders.</li>
<li>Trading at 4.5x our FY23 earnings excluding net cash, it valuation is attractive even compared to depressed sector comps. Expect 20% CAGR of return by 2025 driven by intrinsic value.</li>
</ul>


Over the last decade, VIPShop proved it is the undisputed leader in China’s online discount retail business with the longest streak of profitability and impressive ROE among China internet names.
Investors are misplaced to look to the stock for growth. Rather, it is cash cow in mature business with deep moat and run by disciplined management who cares about shareholders.
Trading at 4.5x our FY23 earnings excluding net cash, it valuation is attractive even compared to depressed sector comps. Expect 20% CAGR of return by 2025 driven by intrinsic value.


VIPShop (VIPS US): Attractive Value Play Underappreciated by Investors Looking for Growth

China

Alibaba Group Holding Limited provides online sales services. The Company provides internet infrastructure, electronic commerce, online financial, and internet content services through its subsidiaries. Alibaba Group Holding offers its products and services worldwide.

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Alibaba Group Holding (9988 HK)

Index Rebalance & ETF Flow Recap: HSCEI, HSI, HSTECH, Yuanta ETFs, China ETFs, REMX, KOSPI

This recap highlights Insights covering Asian index rebalances (announcements/ forecasts/ IPO Fast Entry/ M&A driven changes). We also highlight...

Brian Freitas

APM Human Services IPO Lock-Up - US$400m of Shares Come Free but First PE Needs to Clear Out

APM Human Services (APM) raised about US$730m by selling a mix of primary and secondary shares in Nov 21. The second IPO linked lockup, worth...

Sumeet Singh

MT (Meituan 3690 HK): 2Q23, Record High Op Profit, 38% Buy

Total revenue grew by 33% YoY, which is the highest growth rate in the past seven quarters. The company achieved a higher operating profit in 2Q23...

Ming Lu

ARM Holdings Pre-IPO - Pre-Privatisation to Pre-Listing Changes - Slower Growth, Lower Margins

Softbank Group aims to raise around US$8-10bn via selling some of its stake in ARM Holdings’ US IPO. In this note, we compare its recent...

Sumeet Singh

VIPShop (VIPS US): Attractive Value Play Underappreciated by Investors Looking for Growth

As a cash cow with deep moat run by disciplined management who cares shareholders, VIPShop is an attractive value play trading at 4.5x our FY23...

Eric Chen

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