IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/asia-cement-china-holdings" target="_blank" data-smartkarma-citation="entities:3374:1" rel="noopener">Asia Cement China (743 HK)</a> entered a trading halt based on the Hong Kong Code on Takeovers and Mergers. Bloomberg reports that <a href="https://www.smartkarma.com/entities/asia-cement-corp" target="_blank" data-smartkarma-citation="entities:15350:1" rel="noopener">Asia Cement (1102 TT)</a> is considering a buyout. </li>
<li>Privatisation interest is unsurprising, as ACC’s EV has been negative since 6 July 2022 due to headwinds from the weak Chinese property sector and uncertainty about cash use.</li>
<li>An offer price of HK$5.18 would imply a zero EV. However, due to the difficult trading conditions, we think an offer would be around HK$4.00 per share.</li>
</ul>



Asia Cement China (743 HK) entered a trading halt based on the Hong Kong Code on Takeovers and Mergers. Bloomberg reports that Asia Cement (1102 TT) is considering a buyout. 
Privatisation interest is unsurprising, as ACC’s EV has been negative since 6 July 2022 due to headwinds from the weak Chinese property sector and uncertainty about cash use.
An offer price of HK$5.18 would imply a zero EV. However, due to the difficult trading conditions, we think an offer would be around HK$4.00 per share.


Asia Cement China (743 HK): Privatisation by Asia Cement?

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>Chinese cement play <a href="https://www.smartkarma.com/entities/asia-cement-china-holdings" target="_blank" data-smartkarma-citation="entities:3374:1" rel="noopener">Asia Cement China (743 HK)</a> (ACC) is currently <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2024/0528/2024052801157.pdf" target="_blank" rel="noopener">suspended</a> pursuant to the Takeovers Code.</li>
<li>
<a href="https://www.smartkarma.com/entities/asia-cement-corp" target="_blank" data-smartkarma-citation="entities:15350:1" rel="noopener">Asia Cement (1102 TT)</a> has been ACC's majority shareholder since its 2008 IPO. Asia Cement currently holds 73.07%. </li>
<li>Shares gained ~50% this week. On serious volume. With net cash of US$1.03bn vs. a market cap of US$66mn, a privatisation should command a punchy premium to the last close.</li>
</ul>


Chinese cement play Asia Cement China (743 HK) (ACC) is currently suspended pursuant to the Takeovers Code.

Asia Cement (1102 TT) has been ACC's majority shareholder since its 2008 IPO. Asia Cement currently holds 73.07%. 
Shares gained ~50% this week. On serious volume. With net cash of US$1.03bn vs. a market cap of US$66mn, a privatisation should command a punchy premium to the last close.


Asia Cement (743 HK): Parent's Ready-Mixed Offer?

<ul>
<li>
<a href="https://www.smartkarma.com/entities/adbri-ltd" target="_blank" data-smartkarma-citation="entities:20166:1" rel="noopener">Adbri (ABC AU)</a> has entered a scheme implementation deed with <a href="https://www.smartkarma.com/entities/crh-plc-054117b2-cd70-470a-9efc-8f6fab2c83ec" target="_blank" data-smartkarma-citation="entities:28655:1" rel="noopener">CRH (CRH US)</a> and Barro at A$3.20 per share, a 41.0% premium to the undisturbed price of A$2.27 (13 December).</li>
<li>The offer requires shareholder and FIRB approval. FIRB approval for the bidder, CRH, should be forthcoming as it is a Fortune 500 company with HQ in Ireland. </li>
<li>The offer is attractive vs. peer multiples and historical ranges. At the last close and for a mid-June payment, the gross/annualised spread is 1.9%/6.6%.</li>
</ul>



Adbri (ABC AU) has entered a scheme implementation deed with CRH (CRH US) and Barro at A$3.20 per share, a 41.0% premium to the undisturbed price of A$2.27 (13 December).
The offer requires shareholder and FIRB approval. FIRB approval for the bidder, CRH, should be forthcoming as it is a Fortune 500 company with HQ in Ireland. 
The offer is attractive vs. peer multiples and historical ranges. At the last close and for a mid-June payment, the gross/annualised spread is 1.9%/6.6%.


Adbri (ABC AU): CRH and Barro’s Binding A$3.20 Offer

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

Hygon Information Technology C / Event-Driven

<ul>
<li>The changes for the <a href="https://www.smartkarma.com/entities/sse-science-and-technology-innovation-board-50-index" target="_blank" data-smartkarma-citation="entities:29279:1" rel="noopener">SSE STAR50 (STAR50 INDEX)</a> and STAR100 Index were announced post market close on Friday.</li>
<li>The coming week is a full one with capping cutoffs, review cutoffs, announcements and implementations apart from futures expiries.</li>
<li>With China open after Lunar New Year, the National Team is back pouring money into ETFs with the largest inflows to the <a href="https://www.smartkarma.com/entities/shanghai-shenzhen-csi-300-inde" target="_blank" data-smartkarma-citation="entities:22906:1" rel="noopener">CSI 300</a>, <a href="https://www.smartkarma.com/entities/csi-smallcap-500-index-shang" target="_blank" data-smartkarma-citation="entities:35347:1" rel="noopener">CSI 500</a>, <a href="https://www.smartkarma.com/entities/chinext-index" target="_blank" data-smartkarma-citation="entities:25483:1" rel="noopener">ChiNext</a> and <a href="https://www.smartkarma.com/entities/sse-science-and-technology-innovation-board-50-index" target="_blank" data-smartkarma-citation="entities:29279:1" rel="noopener">STAR50</a> indices.</li>
</ul>


The changes for the SSE STAR50 (STAR50 INDEX) and STAR100 Index were announced post market close on Friday.
The coming week is a full one with capping cutoffs, review cutoffs, announcements and implementations apart from futures expiries.
With China open after Lunar New Year, the National Team is back pouring money into ETFs with the largest inflows to the CSI 300, CSI 500, ChiNext and STAR50 indices.


Index Rebalance & ETF Flow Recap: HSCEI, HSCI, HSTECH, HSIII, STTF, Top50, Div+, FXI, FnGuide

<ul>
<li>
<a href="https://www.smartkarma.com/entities/bizlink-holding-inc" target="_blank" data-smartkarma-citation="entities:6779:1" rel="noopener">Bizlink Holding (3665 TT)</a> should be deleted from the Yuanta/​P-Shares Taiwan Dividend Plus ETF in March and that will trigger selling of over 8 days of ADV.</li>
<li>There will be capping and funding flows due to the higher AUM and passive trackers will need to trade over 0.4x ADV in 5 stocks.</li>
<li>Shorts have covered positions in <a href="https://www.smartkarma.com/entities/bizlink-holding-inc" target="_blank" data-smartkarma-citation="entities:6779:1" rel="noopener">Bizlink Holding (3665 TT)</a> but there has been a recent uptick that could be linked to positioning for the rebalance.</li>
</ul>



Bizlink Holding (3665 TT) should be deleted from the Yuanta/​P-Shares Taiwan Dividend Plus ETF in March and that will trigger selling of over 8 days of ADV.
There will be capping and funding flows due to the higher AUM and passive trackers will need to trade over 0.4x ADV in 5 stocks.
Shorts have covered positions in Bizlink Holding (3665 TT) but there has been a recent uptick that could be linked to positioning for the rebalance.


Yuanta/​P-Shares Taiwan Div+ ETF Rebalance Preview: One Deletion & Capping Changes

Taiwan

Asia Cement Corporation manufactures and sells cement, clinker, ready-mixed concrete, as well as granulated blast-furnace slag and fly ash.  The Company markets its cement and clinker products under the Skyscraper brand name.

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Asia Cement (1102 TT)

Asia Cement China (743 HK): Privatisation by Asia Cement?

An offer price of HK$5.18 would imply a zero EV. However, due to the difficult trading conditions, we think an offer would be around HK$4.00 per...

Arun George

Asia Cement (743 HK): Parent's Ready-Mixed Offer?

Asia Cement (if the Offeror) may lob a cheeky Offer around HK$4/share. But this really needs HK$6+ handle to factor in the cash hoard. OR ...Asia...

David Blennerhassett

Adbri (ABC AU): CRH and Barro’s Binding A$3.20 Offer

The offer is attractive vs. peer multiples and historical ranges. At the last close and for a mid-June payment, the gross/annualised spread is 1.9%...

Arun George

Index Rebalance & ETF Flow Recap: HSCEI, HSCI, HSTECH, HSIII, STTF, Top50, Div+, FXI, FnGuide

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

Brian Freitas

Yuanta/P-Shares Taiwan Div+ ETF Rebalance Preview: One Deletion & Capping Changes

We expect Bizlink will be deleted from the Yuanta/P-shares Taiwan Mid-Cap 100 ETF and the Yuanta/P-Shares Taiwan Dividend Plus ETF in March. That...

Brian Freitas

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Asia Cement China (743 HK): Privatisation by Asia Cement?

An offer price of HK$5.18 would imply a zero EV. However, due to the difficult trading conditions, we think an offer would be around HK$4.00 per...

Arun George

Asia Cement (743 HK): Parent's Ready-Mixed Offer?

Asia Cement (if the Offeror) may lob a cheeky Offer around HK$4/share. But this really needs HK$6+ handle to factor in the cash hoard. OR ...Asia...

David Blennerhassett

Adbri (ABC AU): CRH and Barro’s Binding A$3.20 Offer

The offer is attractive vs. peer multiples and historical ranges. At the last close and for a mid-June payment, the gross/annualised spread is 1.9%...

Arun George

Index Rebalance & ETF Flow Recap: HSCEI, HSCI, HSTECH, HSIII, STTF, Top50, Div+, FXI, FnGuide

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

Brian Freitas

Yuanta/​P-Shares Taiwan Div+ ETF Rebalance Preview: One Deletion & Capping Changes

We expect Bizlink will be deleted from the Yuanta/P-shares Taiwan Mid-Cap 100 ETF and the Yuanta/​P-Shares Taiwan Dividend Plus ETF in March. That...

Brian Freitas

Yuanta/P-Shares Taiwan Div+ ETF Rebalance Preview: One Deletion & Capping Changes

We expect Bizlink will be deleted from the Yuanta/P-shares Taiwan Mid-Cap 100 ETF and the Yuanta/P-Shares Taiwan Dividend Plus ETF in March. That...