Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

Equity Capital Markets

Bukwang Pharmaceutical / Equity Capital Markets

<ul>
<li>On 28 March, Bukwang Pharmaceutical (003000 KS) announced a capital raise of 100 billion won. Its share price fell by 13.3% today. </li>
<li>The company plans to issue 30.2 million new shares (44% of outstanding shares). Expected rights offering price is 3,310 won (15.1% lower than current price). </li>
<li>We are negative on Bukwang Pharm mainly due to excessive shareholding dilution from this rights offering as well as lack of valuation merits. </li>
</ul>


On 28 March, Bukwang Pharmaceutical (003000 KS) announced a capital raise of 100 billion won. Its share price fell by 13.3% today. 
The company plans to issue 30.2 million new shares (44% of outstanding shares). Expected rights offering price is 3,310 won (15.1% lower than current price). 
We are negative on Bukwang Pharm mainly due to excessive shareholding dilution from this rights offering as well as lack of valuation merits. 


Bukwang Pharm Announces A Capital Raise of 100 Billion Won

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 review period for the September rebalance of the KOSPI Size Indices commenced on 1 June and will end on 31 August. Only 4 trading days to go.</li>
<li>We see 7 migrations from MidCap to LargeCap, 1 new addition to LargeCap, 12 stocks moving from SmallCap to MidCap and 3 new additions to MidCap.</li>
<li>The upward migrations have underperformed the downward migrations over the last month as a few stocks have sold off hard. Some despite being included in global indices.</li>
</ul>


The review period for the September rebalance of the KOSPI Size Indices commenced on 1 June and will end on 31 August. Only 4 trading days to go.
We see 7 migrations from MidCap to LargeCap, 1 new addition to LargeCap, 12 stocks moving from SmallCap to MidCap and 3 new additions to MidCap.
The upward migrations have underperformed the downward migrations over the last month as a few stocks have sold off hard. Some despite being included in global indices.


KOSPI Size Indices: Momentum Stalls; (Some) Upward Migrations Sell-Off

<ul>
<li>The review period for the September rebalance of the KOSPI Size Indices commenced on 1 June and will end on 31 August.</li>
<li>We see 8 migrations from MidCap to LargeCap, 1 new addition to LargeCap, 11 stocks moving from SmallCap to MidCap and 3 new additions to MidCap.</li>
<li>There are a few stocks that are expected to have passive flows from global and local index trackers over the next few months and that will add to the impact.</li>
</ul>


The review period for the September rebalance of the KOSPI Size Indices commenced on 1 June and will end on 31 August.
We see 8 migrations from MidCap to LargeCap, 1 new addition to LargeCap, 11 stocks moving from SmallCap to MidCap and 3 new additions to MidCap.
There are a few stocks that are expected to have passive flows from global and local index trackers over the next few months and that will add to the impact.


KOSPI Size Indices: Outperformance Slows on Momentum Stalls

<ul>
<li>The review period for the September rebalance of the KOSPI Size Indices will run from 1 June to 31 August.</li>
<li>We see 6 migrations from MidCap to LargeCap, 1 new addition to LargeCap, 6 stocks moving from SmallCap to MidCap and 3 new additions to MidCap.</li>
<li>Stocks migrating upward have outperformed stocks migrating lower. But there are still stocks trading at a Price to Book of less than 1.</li>
</ul>


The review period for the September rebalance of the KOSPI Size Indices will run from 1 June to 31 August.
We see 6 migrations from MidCap to LargeCap, 1 new addition to LargeCap, 6 stocks moving from SmallCap to MidCap and 3 new additions to MidCap.
Stocks migrating upward have outperformed stocks migrating lower. But there are still stocks trading at a Price to Book of less than 1.


KOSPI Size Indices: Potential Migrations in September Are Moving

Global Healthcare Analyst

Tina Banerjee

Equity Bottom-Up

<ul>
<li>In 2023, <a href="https://www.smartkarma.com/entities/hanmi-pharm-co-ltd" target="_blank" data-smartkarma-citation="entities:12476:1" rel="noopener">Hanmi Pharm (128940 KS)</a> reported 12% and 40% growth in revenue and operating profit, respectively, driven by double-digit revenue increase from Rosuzet and improving performance of China subsidiary.</li>
<li>In January, the company has enrolled first patient in phase 3 trial of type 2 diabetes/obesity drug candidate Efpeglenatide. The study is expected to complete in 2026.</li>
<li>Hanmi Science-OCI merger has hit a roadblock. Although merger with OCI will bring synergistic effect, Hanmi Pharm will continue to grow even if the merger does not happen.</li>
</ul>


In 2023, Hanmi Pharm (128940 KS) reported 12% and 40% growth in revenue and operating profit, respectively, driven by double-digit revenue increase from Rosuzet and improving performance of China subsidiary.
In January, the company has enrolled first patient in phase 3 trial of type 2 diabetes/obesity drug candidate Efpeglenatide. The study is expected to complete in 2026.
Hanmi Science-OCI merger has hit a roadblock. Although merger with OCI will bring synergistic effect, Hanmi Pharm will continue to grow even if the merger does not happen.


OCI Or No OCI, Hanmi Pharm (128940 KS) Will Continue to Roar on Strong Base Business and Pipeline

South Korea

Bukwang Pharmaceutical Co., Ltd. produces oral hygienic, and pharmaceutical products.  The Company's products include over-the-counter drugs, toothpastes, and toothbrushes.

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Bukwang Pharmaceutical (003000 KS)

Bukwang Pharm Announces A Capital Raise of 100 Billion Won

On 28 March, Bukwang Pharmaceutical announced a capital raise of 100 billion won. The company plans to issue 30.2 million new shares (44% of...

Douglas Kim

KOSPI Size Indices: Momentum Stalls; (Some) Upward Migrations Sell-Off

There could be 41 changes to the KOSPI Size Indices in September. The upward migrations have underperformed the downward migrations over the last...

Brian Freitas

KOSPI Size Indices: Outperformance Slows on Momentum Stalls

There could be 41 stocks migrating between size segments in September. The upward migrations have outperformed the downward migrations but the...

Brian Freitas

KOSPI Size Indices: Potential Migrations in September Are Moving

There are many changes expected for the KOSPI size indices in September. The potential upward migrations have outperformed the potential downward...

Brian Freitas

OCI Or No OCI, Hanmi Pharm (128940 KS) Will Continue to Roar on Strong Base Business and Pipeline

Hanmi Pharm has submitted phase 1 clinical trial application for its next-generation obesity drug candidate HM15275 in the U.S., with an aim to...

Tina Banerjee

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