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

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Event-Driven

<div><p>The Stock Exchange of Thailand (SET) will announce the results of the semi-annual review of the <a href="https://www.smartkarma.com/entities/stock-exchange-of-thailand-set-50-index" target="_blank" data-smartkarma-citation="entities:31493:1" rel="noopener">Stock Exchange of Thailand SET 50 Index (SET50 INDEX)</a> in mid-June and the changes will be effective after the close of trading on 30 June.</p></div><div>
<p>The review period for market cap calculations runs from 1 March to 31 May, while the liquidity calculations run from 1 June 2020 to 31 May 2021.</p>
<p>We see three potential changes at the current time with an estimated one-way turnover for the rebalance at 2.19%.</p>
<p>Potential inclusions are <a href="https://www.smartkarma.com/entities/sri-trang-gloves-thailand-public-company-limited" target="_blank" data-smartkarma-citation="entities:29141:1" rel="noopener">Sri Trang Gloves (Thailand) Public Company Limited (STGT TB)</a>, <a href="https://www.smartkarma.com/entities/sri-trang-agro-industry-pcl" target="_blank" data-smartkarma-citation="entities:2759:1" rel="noopener">Sri Trang Agro Industry (STA TB)</a> and <a href="https://www.smartkarma.com/entities/irpc-pcl" target="_blank" data-smartkarma-citation="entities:19051:1" rel="noopener">IRPC PCL (IRPC TB)</a>.</p>
<p>Potential deletions are <a href="https://www.smartkarma.com/entities/vgi-pcl" target="_blank" data-smartkarma-citation="entities:12409:1" rel="noopener">VGI PCL (VGI TB)</a>, <a href="https://www.smartkarma.com/entities/com7-pcl" target="_blank" data-smartkarma-citation="entities:27411:1" rel="noopener">Com7 PCL (COM7 TB)</a> and <a href="https://www.smartkarma.com/entities/toa-paint-thailand-pcl" target="_blank" data-smartkarma-citation="entities:24235:1" rel="noopener">TOA Paint (Thailand) (TOA TB)</a>.</p>
<p><a href="https://www.smartkarma.com/entities/kerry-express-thailand" target="_blank" data-smartkarma-citation="entities:29253:1" rel="noopener">Kerry Express Thailand (KEX TB)</a> will not completed six months of trading history by the end of the review period and will not be eligible for inclusion at the June rebalance.</p>
<p>There is a possibility that the <a href="https://www.smartkarma.com/entities/stock-exchange-of-thailand-set-50-index" target="_blank" data-smartkarma-citation="entities:31493:1" rel="noopener">Stock Exchange of Thailand SET 50 Index (SET50 INDEX)</a> methodology is changed to make it a free float weighted market cap index from a full market cap index. That will see a lot of passive flow on some stocks that have a low free float.</p>
</div>

The Stock Exchange of Thailand (SET) will announce the results of the semi-annual review of the Stock Exchange of Thailand SET 50 Index (SET50 INDEX) in mid-June and the changes will be effective after the close of trading on 30 June.
The review period for market cap calculations runs from 1 March to 31 May, while the liquidity calculations run from 1 June 2020 to 31 May 2021.
We see three potential changes at the current time with an estimated one-way turnover for the rebalance at 2.19%.
Potential inclusions are Sri Trang Gloves (Thailand) Public Company Limited (STGT TB), Sri Trang Agro Industry (STA TB) and IRPC PCL (IRPC TB).
Potential deletions are VGI PCL (VGI TB), Com7 PCL (COM7 TB) and TOA Paint (Thailand) (TOA TB).
Kerry Express Thailand (KEX TB) will not completed six months of trading history by the end of the review period and will not be eligible for inclusion at the June rebalance.
There is a possibility that the Stock Exchange of Thailand SET 50 Index (SET50 INDEX) methodology is changed to make it a free float weighted market cap index from a full market cap index. That will see a lot of passive flow on some stocks that have a low free float.


SET50 Index Rebalance Preview: Potentially Three Changes & Move to Free Float Weighting

APAC IPOs & Placements

Zhen Zhou, Toh

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

PTT Oil & Retail Business  / Equity Capital Markets

<p><a href="https://www.smartkarma.com/entities/ptt-oil-and-retail" target="_blank" data-smartkarma-citation="entities:28939:1" rel="noopener">PTT Oil and Retail (OR TB)</a> raised about US$1.6bn at THB18 per share, the top-end of the IPO price range.</p>
<div>
<p>PTTOR is a market leader in the oil business as well as F&amp;B business. It has leveraged its service station network to build out its brand, Amazon Cafe, which has a strong presence even beyond service stations. </p>
</div>
<div>
<p>We have previously covered the IPO in:</p>
<ul style="list-style-type: disc;">
<li>
<a href="https://www.smartkarma.com/insights/ptt-oil-and-retail-ipo-f-b-business-is-the-profit-driver" target="_blank" data-smartkarma-citation="insights:39105" rel="noopener">PTT Oil and Retail IPO - F&amp;B Business Is the Profit Driver</a> </li>
<li>
<a href="https://www.smartkarma.com/insights/ptt-oil-and-retail-ipo-updated-financials-and-competitive-landscape" target="_blank" data-smartkarma-citation="insights:47002" rel="noopener">PTT Oil and Retail IPO - Updated Financials and Competitive Landscape</a> </li>
<li>
<a href="https://www.smartkarma.com/insights/ptt-oil-and-retail-ipo-thoughts-on-valuation" target="_blank" data-smartkarma-citation="insights:47003" rel="noopener">PTT Oil and Retail IPO - Thoughts on Valuation</a> </li>
<li>
<a href="https://www.smartkarma.com/insights/ptt-oil-and-retail-ipo-attractive-valuation-with-favorable-deal-dynamics-index-inclusion" target="_blank" data-smartkarma-citation="insights:47073" rel="noopener">PTT Oil and Retail IPO - Attractive Valuation with Favorable Deal Dynamics (Index Inclusion)</a> </li>
</ul>
<p>In this note, we will look at the deal dynamics and provide implied valuations at different share price levels.</p>
</div>

PTT Oil and Retail (OR TB) raised about US$1.6bn at THB18 per share, the top-end of the IPO price range.

PTTOR is a market leader in the oil business as well as F&amp;B business. It has leveraged its service station network to build out its brand, Amazon Cafe, which has a strong presence even beyond service stations. 


We have previously covered the IPO in:


PTT Oil and Retail IPO - F&amp;B Business Is the Profit Driver 

PTT Oil and Retail IPO - Updated Financials and Competitive Landscape 

PTT Oil and Retail IPO - Thoughts on Valuation 

PTT Oil and Retail IPO - Attractive Valuation with Favorable Deal Dynamics (Index Inclusion) 

In this note, we will look at the deal dynamics and provide implied valuations at different share price levels.


PTT Oil and Retail IPO Trading - Still Reasonably Priced at the Top-End

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Equity Bottom-Up

<div>
<p>This week in StubWorld ...</p>
</div>
<div>
<div>
<div class="content-highlight">
<p>Following the <a href="https://links.sgx.com/FileOpen/THBEV_Potential_Spin_Off_Listing_of_BeerCo.ashx?App=Announcement&amp;FileID=647386" target="_blank" rel="noopener">no-objection notice</a> from the SGX concerning its BeerCo IPO, the key focus will be on the appropriate discount <a href="https://www.smartkarma.com/entities/thai-beverage-pcl" target="_blank" data-smartkarma-citation="entities:3656:1" rel="noopener">Thai Beverage (THBEV SP)</a> will trade to the spun-off entity, and in turn, BeerCo's discount to 53.5%-held <a href="https://www.smartkarma.com/entities/saigon-beer-alcohol-beverage" target="_blank" data-smartkarma-citation="entities:23645:1" rel="noopener">Saigon Beer Alcohol Beverage (SAB VN)</a>. </p>
</div>
</div>
</div>
<div>
<p>Preceding my comments on ThaiBev <em>and </em><a href="https://www.smartkarma.com/entities/pccw-ltd" target="_blank" data-smartkarma-citation="entities:873:1" rel="noopener">PCCW Ltd (8 HK)</a> are the weekly setup/unwind tables for Asia-Pacific Holdcos.</p>
</div>
<div>
<p>These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.</p>
</div>
<div>
<p>As always, more below the fold.</p>
</div>


This week in StubWorld ...




Following the no-objection notice from the SGX concerning its BeerCo IPO, the key focus will be on the appropriate discount Thai Beverage (THBEV SP) will trade to the spun-off entity, and in turn, BeerCo's discount to 53.5%-held Saigon Beer Alcohol Beverage (SAB VN). 




Preceding my comments on ThaiBev and PCCW Ltd (8 HK) are the weekly setup/unwind tables for Asia-Pacific Holdcos.


These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.


As always, more below the fold.


StubWorld: Double Stub Via ThaiBev's BeerCo IPO

<p>The SET50 Index is one of the very few indices that is still weighted by full market cap. Stocks need to have a minimum free float of 20% to be eligible for index inclusion but the free float is not used to determine the weight of the stock in the index.</p><p>This had led to stocks with low free floats having an inordinately high weight in the index. The most recent case in point was <a href="https://www.smartkarma.com/entities/delta-electronics-thai-pcl" target="_blank" data-smartkarma-citation="entities:20912:1" rel="noopener">Delta Electronics Thai (DELTA TB)</a> - the stock was an inclusion in the SET50 index at the December review. DELTA is now the third largest stock in the index with a 6.07% weighting, even though the SET free float of the stock is only 22.35%. The stock has jumped 1000% over the last year.</p><p>Media reports now indicate that there are changes brewing that could result in the SET revising the calculation methodology to more accurately determine the free float of stocks, and a change to the calculation methodology of the SET50 Index that would see it move from a full market cap weighted index to a free float market cap weighted index.</p><p>In this Insight, we take a look at the stocks that would be affected by the changes and the impact of passive fund trading on the stocks.</p>

The SET50 Index is one of the very few indices that is still weighted by full market cap. Stocks need to have a minimum free float of 20% to be eligible for index inclusion but the free float is not used to determine the weight of the stock in the index.This had led to stocks with low free floats having an inordinately high weight in the index. The most recent case in point was Delta Electronics Thai (DELTA TB) - the stock was an inclusion in the SET50 index at the December review. DELTA is now the third largest stock in the index with a 6.07% weighting, even though the SET free float of the stock is only 22.35%. The stock has jumped 1000% over the last year.Media reports now indicate that there are changes brewing that could result in the SET revising the calculation methodology to more accurately determine the free float of stocks, and a change to the calculation methodology of the SET50 Index that would see it move from a full market cap weighted index to a free float market cap weighted index.In this Insight, we take a look at the stocks that would be affected by the changes and the impact of passive fund trading on the stocks.

SET50 Index: Change to Free Float Weighting In the Works?

<div>
<p><em>This week in StubWorld ...</em></p>
</div>
<div>
<ul>
<li>
<a href="https://www.smartkarma.com/entities/tokyo-electron-ltd" target="_blank" data-smartkarma-citation="entities:280:1" rel="noopener">Tokyo Electron (8035 JP)</a> outperforms as global carmakers face a chip shortage;</li>
<li>
<a href="https://www.smartkarma.com/entities/gulf-energy-development-public-company-limited" target="_blank" data-smartkarma-citation="entities:26038:1" rel="noopener">Gulf Energy Development Public Company (GULF TB)</a> increases its questionable stake in <a href="https://www.smartkarma.com/entities/intouch-holdings-pcl" target="_blank" data-smartkarma-citation="entities:17638:1" rel="noopener">Intouch Holdings (INTUCH TB)</a>; and</li>
<li>
<a href="https://www.smartkarma.com/entities/jardine-matheson-holdings-ltd" target="_blank" data-smartkarma-citation="entities:19718:1" rel="noopener">Jardine Matheson Holdings (JM SP)</a>'s ramps up its buybacks.</li>
</ul>
</div>
<hr>
<div>
<p>Preceding my comments on these holdcos are the weekly setup/unwind tables for Asia-Pacific Holdcos.</p>
</div>
<div>
<p>These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.</p>
</div>


This week in StubWorld ...




Tokyo Electron (8035 JP) outperforms as global carmakers face a chip shortage;

Gulf Energy Development Public Company (GULF TB) increases its questionable stake in Intouch Holdings (INTUCH TB); and

Jardine Matheson Holdings (JM SP)'s ramps up its buybacks.




Preceding my comments on these holdcos are the weekly setup/unwind tables for Asia-Pacific Holdcos.


These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.


StubWorld: TBS/Tokyo Electron, Intouch/Gulf, Jardines' Buybacks

Thailand

Gulf Energy Development Public Company Limited produces and sells electricity and steam. The Company manages a portfolio of gas-fired and renewable power projects, as well as supplies steam and chilled water. Gulf Energy Development serves customers in Thailand.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Gulf Energy Development (GULF TB)

SET50 Index Rebalance Preview: Potentially Three Changes & Move to Free Float Weighting

There could be 3 changes to the SET50 at the June review with STGT, STA & IRPC joining the index at the expense of VGI, TOA & COM7. The methodology...

Brian Freitas

PTT Oil and Retail IPO Trading - Still Reasonably Priced at the Top-End

PTTOR raised about US$1.6bn at THB18 per share. In this note, we will look at the deal dynamics and provide implied valuations at different share...

Zhen Zhou, Toh

StubWorld: Double Stub Via ThaiBev's BeerCo IPO

I estimate minimal upside for ThaiBev here if assuming a 25% discount to NAV. ThaiBev is trading at 16.5x trailing EV/EBITDA, but its forward EV...

David Blennerhassett

SET50 Index: Change to Free Float Weighting In the Works?

There is a strong possibility that the SET revises the calculation methodology to more accurately determine the free float of stocks, and changes...

Brian Freitas

StubWorld: TBS/Tokyo Electron, Intouch/Gulf, Jardines' Buybacks

Tokyo Electron (8035 JP) outperforms as global carmakers face a chip shortage; Gulf Energy increases its questionable stake in Intouch; and Jardine...

David Blennerhassett

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)