Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>This is the Brand Spanking New and Improved and Extra Spiffy H/A-Share Discount/Premium Weekly designed to help investors see H/A relationships easily. </li>
<li>We used to do it and decided to bring it back better. There are lots of cool interactive tables, and charts, heat maps, and comparative data. And 19 Trade Recommendations. </li>
<li>We hope this new version serves readers even better. Improvements this week due to popular demand, and updated format. Further feedback is welcome/appreciated. </li>
</ul>


This is the Brand Spanking New and Improved and Extra Spiffy H/A-Share Discount/Premium Weekly designed to help investors see H/A relationships easily. 
We used to do it and decided to bring it back better. There are lots of cool interactive tables, and charts, heat maps, and comparative data. And 19 Trade Recommendations. 
We hope this new version serves readers even better. Improvements this week due to popular demand, and updated format. Further feedback is welcome/appreciated. 


Week 2 of the Brand New and Extra Spiffy 🦄 H/​A-Share Discount/​Premium Weekly (As of 18 Aug 2023)

HK/China Equity Long-Short

Osbert Tang, CFA

Equity Bottom-Up

China Communications Construction / Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/china-communications-construction-co-ltd" target="_blank" data-smartkarma-citation="entities:265:1" rel="noopener">China Communications Construction (1800 HK)</a> saw stronger new contract growth in 2Q23, increasing by 15.5% YoY. Sharp pick-up in domestic contracts is the key driver.</li>
<li>We estimate its backlog at end-1H23 at Rmb3.9trn, up 15% from end-FY22. This equals 5.1x the projected FY23 revenue, indicating very comfortable forward coverage.</li>
<li>Despite a 22.5% share price increase YTD, it trades on just 0.21x P/B. Compared with an ROE of 7-8%, it is inexpensive. Upside will come from asset value realisation.</li>
</ul>



China Communications Construction (1800 HK) saw stronger new contract growth in 2Q23, increasing by 15.5% YoY. Sharp pick-up in domestic contracts is the key driver.
We estimate its backlog at end-1H23 at Rmb3.9trn, up 15% from end-FY22. This equals 5.1x the projected FY23 revenue, indicating very comfortable forward coverage.
Despite a 22.5% share price increase YTD, it trades on just 0.21x P/B. Compared with an ROE of 7-8%, it is inexpensive. Upside will come from asset value realisation.


China Comm Const (1800 HK): New Contract Growth Accelerated

Pan-Asia Index Flows & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Pan-Asia Index Flows & Special Situations

<ul>
<li>SSE 50 and SSE180, respectively, aim to represent the performance of the 50 and 180 largest and most liquid A-share stocks listed on Shanghai Stock Exchange. </li>
<li>SSE 380 consists of 380 mid-cap stocks which are selected from the remaining Shanghai listed A-shares after the constituents of SSE 180 Index. </li>
<li>In this insight, we take a brief look at the index selection methodology and the historical price and volume performance of the SSE 50/180/380 index rebalance baskets.</li>
</ul>


SSE 50 and SSE180, respectively, aim to represent the performance of the 50 and 180 largest and most liquid A-share stocks listed on Shanghai Stock Exchange. 
SSE 380 consists of 380 mid-cap stocks which are selected from the remaining Shanghai listed A-shares after the constituents of SSE 180 Index. 
In this insight, we take a brief look at the index selection methodology and the historical price and volume performance of the SSE 50/180/380 index rebalance baskets.


Quiddity Primer for SSE 50/180/380 Index Rebalance Events

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

<ul>
<li>The review period for a bunch of indices ended early last week and the announcement of the changes will be made in the next few weeks.</li>
<li>
<a href="https://www.smartkarma.com/entities/hydro-lithium-inc" target="_blank" data-smartkarma-citation="entities:8293:1" rel="noopener">Hydro Lithium (101670 KS)</a> will replace <a href="https://www.smartkarma.com/entities/nice-information-service-co" target="_blank" data-smartkarma-citation="entities:20236:1" rel="noopener">Nice Information Service Co (030190 KS)</a> in the <a href="https://www.smartkarma.com/entities/kosdaq-150-index" target="_blank" data-smartkarma-citation="entities:31077:1" rel="noopener">KOSDAQ 150 Index (KOSDQ150 INDEX EQUITY)</a> at the close on Monday.</li>
<li>There have been big net inflows into China focused ETFs and outflows from Taiwan focused ETFs during the week.</li>
</ul>


The review period for a bunch of indices ended early last week and the announcement of the changes will be made in the next few weeks.

Hydro Lithium (101670 KS) will replace Nice Information Service Co (030190 KS) in the KOSDAQ 150 Index (KOSDQ150 INDEX EQUITY) at the close on Monday.
There have been big net inflows into China focused ETFs and outflows from Taiwan focused ETFs during the week.


Index Rebalance & ETF Flow Recap: NKY, STAR50, NIFTY NEXT50, SF Holding

<ul>
<li>As of 1 August, there could be two changes for the <a href="https://www.smartkarma.com/entities/ishares-ftse-a50-china-index-etf" target="_blank" data-smartkarma-citation="entities:249:1" rel="noopener">iShares A50 China (2823 HK)</a>/ <a href="https://www.smartkarma.com/entities/csop-ftse-china-a50-etf-26e3b671-fa47-4165-a12e-bf841640c5a3" target="_blank" data-smartkarma-citation="entities:23664:1" rel="noopener">CSOP A50 (2822 HK)</a> in September.</li>
<li>There should be over 1x ADV to buy on <a href="https://www.smartkarma.com/entities/nari-technology-co-ltd-a" target="_blank" data-smartkarma-citation="entities:4364:1" rel="noopener">NARI Technology Co Ltd A (600406 CH)</a> and over 1x ADV to sell on <a href="https://www.smartkarma.com/entities/shaanxi-coal-industry-co-ltd" target="_blank" data-smartkarma-citation="entities:11254:1" rel="noopener">Shaanxi Coal Industry (601225 CH)</a>. </li>
<li>There are a few stocks bunched around similar market caps among the potential adds and there could be changes to the list over the next few weeks.</li>
</ul>


As of 1 August, there could be two changes for the iShares A50 China (2823 HK)/ CSOP A50 (2822 HK) in September.
There should be over 1x ADV to buy on NARI Technology Co Ltd A (600406 CH) and over 1x ADV to sell on Shaanxi Coal Industry (601225 CH). 
There are a few stocks bunched around similar market caps among the potential adds and there could be changes to the list over the next few weeks.


Offshore China ETFs Rebalance Preview: Two Changes in September

China

China Railway Group Limited offers transportation facility construction services. The Company builds railways, roads, tunnels, and bridges. China Railway Group also conducts engineering survey, equipment manufacturing, real estate development, and investment businesses.

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China Railway Group (601390 CH)

China Comm Const (1800 HK): New Contract Growth Accelerated

New contract growth accelerated to 15.5% in 2Q23, and we estimate its end-1H23 backlog is enough to cover 5.1x the projected FY23 revenue. Relative...

Osbert Tang, CFA

Quiddity Primer for SSE 50/180/380 Index Rebalance Events

Names moving directly in and out of SSE 50 and SSE 180 are likely to be the most interesting cases for trading opportunities. SSE 380 index changes...

Janaghan Jeyakumar, CFA

Index Rebalance & ETF Flow Recap: NKY, STAR50, NIFTY NEXT50, SF Holding

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

Brian Freitas

Offshore China ETFs Rebalance Preview: Two Changes in September

There could be two sets of the changes for the 2823/2822 ETFs in September. A couple of stocks will have over 1x ADV to trade. There are few close...

Brian Freitas

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Week 2 of the Brand New and Extra Spiffy 🦄 H/​A-Share Discount/​Premium Weekly (As of 18 Aug 2023)

Week 2 of the Brand New and Extra Spiffy H/A Discount Monitor. Thanks for the requests. Some are implemented. Some are on the way. Trades were up...

Travis Lundy

China Comm Const (1800 HK): New Contract Growth Accelerated

New contract growth accelerated to 15.5% in 2Q23, and we estimate its end-1H23 backlog is enough to cover 5.1x the projected FY23 revenue. Relative...

Osbert Tang, CFA

Quiddity Primer for SSE 50/180/380 Index Rebalance Events

Names moving directly in and out of SSE 50 and SSE 180 are likely to be the most interesting cases for trading opportunities. SSE 380 index changes...

Janaghan Jeyakumar, CFA

Index Rebalance & ETF Flow Recap: NKY, STAR50, NIFTY NEXT50, SF Holding

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

Brian Freitas

Offshore China ETFs Rebalance Preview: Two Changes in September

There could be two sets of the changes for the 2823/2822 ETFs in September. A couple of stocks will have over 1x ADV to trade. There are few close...

Brian Freitas

Week 2 of the Brand New and Extra Spiffy 🦄 H/A-Share Discount/Premium Weekly (As of 18 Aug 2023)