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>We see 28 potential inclusions to the HSCI in September, plus another 9 stocks that are close to the inclusion cutoff. Some stocks are already a part of Stock Connect.</li>
<li>There could be 22 deletions from the index on market cap, liquidity and prolonged suspension. Most of the deletions would be moved to the 'sell-only' Southbound Stock Connect list.</li>
<li>Some of the stocks that remain in the HSCI could move to the 'sell-only' Southbound Stock Connect list since their average market cap drops below HKD 5bn.</li>
</ul>


We see 28 potential inclusions to the HSCI in September, plus another 9 stocks that are close to the inclusion cutoff. Some stocks are already a part of Stock Connect.
There could be 22 deletions from the index on market cap, liquidity and prolonged suspension. Most of the deletions would be moved to the 'sell-only' Southbound Stock Connect list.
Some of the stocks that remain in the HSCI could move to the 'sell-only' Southbound Stock Connect list since their average market cap drops below HKD 5bn.


HSCI Index Rebalance and Stock Connect: Potential Changes in September

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.

Coast Entertainment Holdings L / Event-Driven

<ul>
<li>The EGM to approve <a href="https://www.smartkarma.com/entities/dave-buster-s-entertainment-inc" target="_blank" data-smartkarma-citation="entities:19774:1" rel="noopener">Dave &amp; Buster'S Entertainment, Inc (PLAY US)</a>'s acquisition of Main Event is on 29 June. <a href="https://www.smartkarma.com/entities/ardent-leisure-group-ltd" target="_blank" data-smartkarma-citation="entities:29059:1" rel="noopener">Ardent Leisure Group Ltd (ALG AU)</a> will receive A$670.3 million.</li>
<li>If the transaction is approved, shareholders will receive a total return of A$0.95 through capital return and special dividends. The independent expert opines that the transaction is fair and reasonable.</li>
<li>At the last close price, the remaining business is valued at just 2 cents. Our SoTP valuation of A$1.65 per share is a 22% upside to the last close.</li>
</ul>


The EGM to approve Dave &amp; Buster'S Entertainment, Inc (PLAY US)'s acquisition of Main Event is on 29 June. Ardent Leisure Group Ltd (ALG AU) will receive A$670.3 million.
If the transaction is approved, shareholders will receive a total return of A$0.95 through capital return and special dividends. The independent expert opines that the transaction is fair and reasonable.
At the last close price, the remaining business is valued at just 2 cents. Our SoTP valuation of A$1.65 per share is a 22% upside to the last close.


Ardent Leisure’s EGM Related to Main Event Sale on 29 June; Unlock Value

China Huarong Asset Management / Event-Driven

<ul>
<li>We see seven new listings as potential inclusions to the HSCI in June. One is already a part of Connect while five will be added to Southbound Stock Connect.</li>
<li>We see 19 potential changes to the HSCI in September. Seven of the deletions are on market cap, four on liquidity, and eight due to prolonged trading suspension.</li>
<li>Some of the potential deletions have large Southbound holdings and some of these could be trimmed over the next couple of months.</li>
</ul>


We see seven new listings as potential inclusions to the HSCI in June. One is already a part of Connect while five will be added to Southbound Stock Connect.
We see 19 potential changes to the HSCI in September. Seven of the deletions are on market cap, four on liquidity, and eight due to prolonged trading suspension.
Some of the potential deletions have large Southbound holdings and some of these could be trimmed over the next couple of months.


HSCI Index Rebalance and Stock Connect: Potential Changes in June and September

HK/China Equity Long-Short

Osbert Tang, CFA

Thematic (Sector/Industry)

<ul>
<li>State Council's announcement of China 14th 5-year Tourism Industry Development Plan recently should see positive policies and supportive measures to be rolled out over the medium term. </li>
<li>
<a href="https://www.smartkarma.com/entities/fosun-tourism-group" target="_blank" data-smartkarma-citation="entities:27439:1" rel="noopener">Fosun Tourism (1992 HK)</a>, <a href="https://www.smartkarma.com/entities/china-tourism-group-duty-free-corp-ltd" target="_blank" data-smartkarma-citation="entities:12278:1" rel="noopener">China Tourism Group Duty Free Corp Ltd (601888 CH)</a>, <a href="https://www.smartkarma.com/entities/china-travel-international-investment-hong-kong" target="_blank" data-smartkarma-citation="entities:3879:1" rel="noopener">China Travel International Investment (308 HK)</a> and <a href="https://www.smartkarma.com/entities/haichang-ocean-park-holdings-ltd" target="_blank" data-smartkarma-citation="entities:11396:1" rel="noopener">Haichang Ocean Park (2255 HK)</a> are some key beneficiaries.</li>
<li>We believe <a href="https://www.smartkarma.com/entities/air-china-ltd-h" target="_blank" data-smartkarma-citation="entities:8239:1" rel="noopener">Air China Ltd (H) (753 HK)</a> will benefit from the recovery of international air passenger as the Plan highlights the importance of promoting inbound/outbound tourism after the pandemic.</li>
</ul>


State Council's announcement of China 14th 5-year Tourism Industry Development Plan recently should see positive policies and supportive measures to be rolled out over the medium term. 

Fosun Tourism (1992 HK), China Tourism Group Duty Free Corp Ltd (601888 CH), China Travel International Investment (308 HK) and Haichang Ocean Park (2255 HK) are some key beneficiaries.
We believe Air China Ltd (H) (753 HK) will benefit from the recovery of international air passenger as the Plan highlights the importance of promoting inbound/outbound tourism after the pandemic.


Beneficiaries of China's 14th 5-Year Tourism Industry Development Plan

Global Gaming and Casinos Industry Specialist, Casino Business Review LLC

Howard J Klein

Global Gaming and Casinos Industry Specialist

Equity Bottom-Up

Haichang Ocean Park Holdings / Equity Bottom-Up

<ul>
<li>A strong asset base in 6 major parks plus two amusement parks battered by long term bearish sentiment exacerbated by the virus crisis produces a low risk entry point.</li>
<li>The company's 5 year annual growth trend pre-virus has moved from 10.3% to 49.84% in 2019. Much growth fueled by capex debt.</li>
<li>Trading at a 52-week low of -57.6% YTD, the stock will benefit from the concept of operating leverage as the virus crisis enters early stage of re-openings.</li>
</ul>


A strong asset base in 6 major parks plus two amusement parks battered by long term bearish sentiment exacerbated by the virus crisis produces a low risk entry point.
The company's 5 year annual growth trend pre-virus has moved from 10.3% to 49.84% in 2019. Much growth fueled by capex debt.
Trading at a 52-week low of -57.6% YTD, the stock will benefit from the concept of operating leverage as the virus crisis enters early stage of re-openings.


Haichang Ocean Park Holdings Ltd: Timing Might Be Right for a Close Look on a Post Virus Bull Case

China

Haichang Ocean Park Holdings Ltd develops and operates theme parks and other ancillary commercial properties. The Company manages museums, aquariums, theme parks, water theme parks, and other related properties. Haichang Ocean Park Holdings manages its parks throughout The People's Republic of China.

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Haichang Ocean Park Holdings (2255 HK)

HSCI Index Rebalance and Stock Connect: Potential Changes in September

We see 28 potential adds and 9 close adds for the HSCI in September. There are 22 potential deletes on market cap, liquidity and prolonged...

Brian Freitas

HSCI Index Rebalance and Stock Connect: Potential Changes in June and September

We forecast 7 adds to the HSCI in June. For the September rebalance, we forecast 19 adds & 19 deletes (7 on mkt cap, 4 on liquidity, 8 on long...

Brian Freitas

Beneficiaries of China's 14th 5-Year Tourism Industry Development Plan

China's 14th 5-year Tourism Development Plan are positive to many players in the tourism industry. We expect more favourable policies and...

Osbert Tang, CFA

Haichang Ocean Park Holdings Ltd: Timing Might Be Right for a Close Look on a Post Virus Bull Case

A strong asset base in 6 major parks plus two amusement parks battered by long term bearish sentiment exacerbated by the virus crisis produces a...

Howard J Klein

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

HSCI Index Rebalance and Stock Connect: Potential Changes in September

We see 28 potential adds and 9 close adds for the HSCI in September. There are 22 potential deletes on market cap, liquidity and prolonged...

Brian Freitas

Ardent Leisure’s EGM Related to Main Event Sale on 29 June; Unlock Value

Shareholders will receive a total return of A$0.95 through capital return and special dividends. Our SoTP valuation of A$1.65 per share is a 22%...

Arun George

HSCI Index Rebalance and Stock Connect: Potential Changes in June and September

We forecast 7 adds to the HSCI in June. For the September rebalance, we forecast 19 adds & 19 deletes (7 on mkt cap, 4 on liquidity, 8 on long...

Brian Freitas

Beneficiaries of China's 14th 5-Year Tourism Industry Development Plan

China's 14th 5-year Tourism Development Plan are positive to many players in the tourism industry. We expect more favourable policies and...

Osbert Tang, CFA

Haichang Ocean Park Holdings Ltd: Timing Might Be Right for a Close Look on a Post Virus Bull Case

A strong asset base in 6 major parks plus two amusement parks battered by long term bearish sentiment exacerbated by the virus crisis produces a...

Howard J Klein