Korea / Special Sits, Pairs, Index Rebalancing, Clepsydra Capital

Sanghyun Park

Korea / Special Sits, Pairs, Index Rebalancing

Clepsydra Capital

Investigate special situations, pairs, and index rebalancing trades in Korea.

Event-Driven

<ul>
<li>K200 futures' yearend contango exceeded expectations, triggering a surge in buy arbitrage. The subsequent selling pressure intensified, with strategic shifts observed in January futures/options, contributing to KOSPI's underperformance this year.</li>
<li>Still, significant closure of K200 futures buy arbitrage should come around March, impacting February or March single-stock futures, potentially introducing substantial contango and suggesting lucrative dividend arbitrage in select stocks.</li>
<li>These 40 K200 constituents, with single-stock futures, are vital for our pioneering dividend arbitrage in Korea, directly influenced by buy arbitrage closures using K200 futures from last year.</li>
</ul>


K200 futures' yearend contango exceeded expectations, triggering a surge in buy arbitrage. The subsequent selling pressure intensified, with strategic shifts observed in January futures/options, contributing to KOSPI's underperformance this year.
Still, significant closure of K200 futures buy arbitrage should come around March, impacting February or March single-stock futures, potentially introducing substantial contango and suggesting lucrative dividend arbitrage in select stocks.
These 40 K200 constituents, with single-stock futures, are vital for our pioneering dividend arbitrage in Korea, directly influenced by buy arbitrage closures using K200 futures from last year.


40 Names for Dividend Arbitrage in 1Q, Marking a Pioneering Initiative in Korea

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Bottom-Up

<ul>
<li>We discuss the importance of Hyundai Motor generating nearly 11.5 trillion won in operating profit in 2023, which is likely to be the highest among all Korean companies. </li>
<li>Hyundai Motor and Kia Corp combined are expected to generate operating profit of 20.7 trillion won in 2023, representing 57% of total operating profit of the top 10 Korean companies.</li>
<li>In 2023, Hyundai Motor plans a full-scale world-wide roll-out of its EV Ioniq 6. Furthermore, it set a dividend payout ratio at 25% or higher.</li>
</ul>


We discuss the importance of Hyundai Motor generating nearly 11.5 trillion won in operating profit in 2023, which is likely to be the highest among all Korean companies. 
Hyundai Motor and Kia Corp combined are expected to generate operating profit of 20.7 trillion won in 2023, representing 57% of total operating profit of the top 10 Korean companies.
In 2023, Hyundai Motor plans a full-scale world-wide roll-out of its EV Ioniq 6. Furthermore, it set a dividend payout ratio at 25% or higher.


Hyundai Motor: Highest Operating Profit Among All Korean Companies in 2023

<ul>
<li>Hyundai Motor (005380 KS) launched its long-awaited Ioniq 6 on 14 July. This is the first EV sedan by Hyundai Motor.</li>
<li>Ioniq 6 could be a big winner for Hyundai Motor. Among all the features of Ioniq 6, the driving range is the biggest improvement versus Ioniq 5. </li>
<li>The combination of attractive price, sleek design, and higher driving range is likely to result in a strong demand for Ioniq 6.</li>
</ul>


Hyundai Motor (005380 KS) launched its long-awaited Ioniq 6 on 14 July. This is the first EV sedan by Hyundai Motor.
Ioniq 6 could be a big winner for Hyundai Motor. Among all the features of Ioniq 6, the driving range is the biggest improvement versus Ioniq 5. 
The combination of attractive price, sleek design, and higher driving range is likely to result in a strong demand for Ioniq 6.


Hyundai Motor's Ioniq 6 - To Take Away More Market Share From Tesla Model 3 Sedan?

Equity Long-Short Analyst

Pyari Menon

Thematic (Sector/Industry)

<ul>
<li>For this report we datamined autonomous driving technology (ADT) innovations.</li>
<li>Worldwide over the last decade the ADT sector has seen nearly 25% CAGR growth in patent filings, with over 40,000 patent family filings.</li>
<li>
<a href="https://www.smartkarma.com/entities/delphi-automotive-plc" target="_blank" data-smartkarma-citation="entities:20870:1" rel="noopener"><strong>Aptiv PLC (APTV US)</strong></a>, with a leadership position in several areas of ADT, strong financials, reasonable valuations and strategic partnerships stands out.  </li>
</ul>


For this report we datamined autonomous driving technology (ADT) innovations.
Worldwide over the last decade the ADT sector has seen nearly 25% CAGR growth in patent filings, with over 40,000 patent family filings.

Aptiv PLC (APTV US), with a leadership position in several areas of ADT, strong financials, reasonable valuations and strategic partnerships stands out.  


Douglas Research Advisory

<ul>
<li>The Deputy Prime Minister Choi Sang Mok reaffirmed the Corporate Value Up program, pushing up the major value driven/low PBR stocks in Korea today.</li>
<li>Deputy Prime Minister Choi emphasized that as part of Corporate Value Up program, corporate tax benefits to companies that have made efforts to strengthen shareholder return policy will be provided.</li>
<li>The Korean government also plans to revise the law to separate taxation on the dividend income of shareholders of companies that expand dividends.</li>
</ul>


The Deputy Prime Minister Choi Sang Mok reaffirmed the Corporate Value Up program, pushing up the major value driven/low PBR stocks in Korea today.
Deputy Prime Minister Choi emphasized that as part of Corporate Value Up program, corporate tax benefits to companies that have made efforts to strengthen shareholder return policy will be provided.
The Korean government also plans to revise the law to separate taxation on the dividend income of shareholders of companies that expand dividends.


South Korea

Hyundai Motor Company manufactures, sells, and exports passenger cars, trucks, and commercial vehicles. The Company also sells various auto parts and operates auto repair service centers throughout South Korea. Hyundai Motor provides financial services through its subsidiaries.

Kia Corporation manufactures, sells, and exports passenger cars, mini-buses, trucks and commercial vehicles. The Company also manufactures auto-parts and tools using hybrid electric and fuel cell technology. Kia markets its products worldwide.

KG Mobility Corp. manufactures and distributes automobiles. The Company produces passenger vehicles, sports utility vehicles, automotive engine, heavy equipment and auto parts, and other related products. KG Mobility markets its products worldwide.

Hyundai Mobis Co., Ltd. manufactures and markets automotive parts and equipment, such as  automotive service components, modules, and systems. The Company also contractsenvironmental projects, including sewage treatment plant and industrial waste water treatment plant construction.

Hankook Tire & Technology Co. Ltd. develops and manufactures radial tires for passenger cars, light trucks, trucks, and buses.  The Company also produces batteries and aluminum alloy wheels and operates real estate business.

HL Mando Corp manufactures and markets automotive parts and equipments.  The Company's product line includes brake systems, suspension systems, and steering systems.

Hanon Systems manufactures a variety of automotive air control equipment.  The Company's products include air conditioners, heaters, cooling modules, compressors, radiators, fans, evaporators, and condensers. Hanon Systems distributes its products on an original equipment manufacturing (OEM) basis.

SL Corp. designs and manufactures head lamps, chassis, and power trains for autos and motorcycles.  The Company exports its products to overseas market such as North America and Australia.

Sebang Global Battery Co., Ltd. specializes in manufacturing storage batteries used in automobiles, motorcycles, electric vehicles, and industrial machinery such as excavators and bulldozers.  The Company provides its products to domestic and overseas markets.

Kumho Tire Co., Inc. designs and produces tires.  The Company's main products include various automobile tires and tubes used in sedan, SUV, RV, truck, and bus.  Kumho Tire also provides racing tires.

PT Astra International Tbk assembles and distributes automobiles, motorcycles, and their related spare parts.  Through its subsidiaries, the Company also operates in the mining, development of plantations, financial and information technology.

NISSAN MOTOR CO., LTD. manufactures and distributes automobiles and related parts. It also provides financing services. Nissan delivers a comprehensive range of products under various brands. The Company manufactures in Japan, the United States, Mexico, the United Kingdom and many other countries.

Geely Automobile Holdings Limited operates as a passenger vehicles manufacturing company. The Company provides passenger vehicles development, manufacturing, sales, and other services. Geely Automobile Holdings also exports passenger vehicles.

Great Wall Motor Company Limited, through its subsidiaries, manufactures and sells pick-up trucks and sport-utility vehicles (SUVs) in China under branded names. The Company also researches and develops, and manufactures principal automotive parts and components for use in the assembly of pick-up trucks and SUVs.

Honda Motor Co., Ltd. develops, manufactures, and distributes motorcycles, automobiles, and power products such as generators and farm machinery. The Company also operates a financial credit business. Honda Motor has manufacturing facilities in the US, Canada, the UK, France, Italy, Spain, Brazil, Mexico, India, and Thailand.

Tata Motors Limited manufactures cars and commercial automotive vehicles in India. The Company designs, manufactures and sells heavy commercial, medium commercial and small commercial vehicles including trucks, tankers, vans, buses, ambulances and minibuses. Tata also manufactures small cars and sports utility vehicles.

Suzuki Motor Corporation manufactures automobiles, motorcycles, and their related parts. The Company has production facilities in USA, Japan, Taiwan, India, Pakistan, Indonesia, Thailand, and Hungary.

Maruti Suzuki India Limited manufactures and exports automobiles. Maruti collaborated with Suzuki of Japan to produce affordable cars for the average Indian.

Hero MotoCorp Ltd. designs, manufactures and distributes motorcycles. The Company's products also include motorcycle parts and accessories.

Bajaj Auto Limited manufactures and distributes motorized two-wheeled and three-wheeled scooters, motorcycles and mopeds.

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Hyundai Motor (005387 KS)

40 Names for Dividend Arbitrage in 1Q, Marking a Pioneering Initiative in Korea

This post identifies 40 KOSPI 200 constituents we should target for our pioneering dividend arbitrage initiative in March of this year.

Sanghyun Park

Hyundai Motor: Highest Operating Profit Among All Korean Companies in 2023

In this insight, we discuss the importance of Hyundai Motor generating nearly 11.5 trillion won in operating profit in 2023, which is likely to be...

Douglas Kim

Autonomous Driving Leadership Landscape

Autonomous driving tech seeing surge in innovations to make journeys safer, more efficient, and intelligent. Welcome to the future of mobility.

Pyari Menon

Mr. Choi Goes to Washington

The Deputy Prime Minister Choi Sang Mok reaffirmed the Corporate Value Up program, pushing up the major value driven/low PBR stocks in Korea today.

Douglas Kim

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

40 Names for Dividend Arbitrage in 1Q, Marking a Pioneering Initiative in Korea

This post identifies 40 KOSPI 200 constituents we should target for our pioneering dividend arbitrage initiative in March of this year.

Sanghyun Park

Hyundai Motor: Highest Operating Profit Among All Korean Companies in 2023

In this insight, we discuss the importance of Hyundai Motor generating nearly 11.5 trillion won in operating profit in 2023, which is likely to be...

Douglas Kim

Hyundai Motor's Ioniq 6 - To Take Away More Market Share From Tesla Model 3 Sedan?

Hyundai Motor launched its long-awaited Ioniq 6 on 14 July. This is the first EV sedan by Hyundai Moto. Among all the features of Ioniq 6, the...

Douglas Kim

Autonomous Driving Leadership Landscape

Autonomous driving tech seeing surge in innovations to make journeys safer, more efficient, and intelligent. Welcome to the future of mobility.

Pyari Menon

Mr. Choi Goes to Washington

The Deputy Prime Minister Choi Sang Mok reaffirmed the Corporate Value Up program, pushing up the major value driven/low PBR stocks in Korea today.

Douglas Kim