Pan-Asia Index Flows & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Pan-Asia Index Flows & Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Event-Driven

<ul>
<li>The ChiNext Index represents the performance of the 100 largest and most liquid A-share stocks listed on the ChiNext Market of the Shenzhen Stock Exchange.</li>
<li>The ChiNext 50 index is a subset of the ChiNext Index and it consists of the top 50 names in the ChiNext index with the highest daily average turnover.</li>
<li>In this insight, we have presented our updated rankings for Potential ADDs and DELs for the upcoming index rebal event in December 2024.</li>
</ul>


The ChiNext Index represents the performance of the 100 largest and most liquid A-share stocks listed on the ChiNext Market of the Shenzhen Stock Exchange.
The ChiNext 50 index is a subset of the ChiNext Index and it consists of the top 50 names in the ChiNext index with the highest daily average turnover.
In this insight, we have presented our updated rankings for Potential ADDs and DELs for the upcoming index rebal event in December 2024.


Quiddity Leaderboard ChiNext Dec 24: East Group Intra-Review Deletion Causes Changes to Expectations

Global Healthcare Analyst

Tina Banerjee

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/top-glove-corp-bhd" target="_blank" data-smartkarma-citation="entities:20759:1" rel="noopener">Top Glove Corp (TOPG MK)</a> achieved 16% QoQ revenue growth in 3QFY24, on 13% sequential volume increase and higher ASP. 3QFY24 operational loss reduced to RM34M from RM59M in 2QFY24.</li>
<li>Considering the current demand and supply condition, Top Glove expects the ASP to further increase. The company aims to recover its EBITDA margin to pre-pandemic levels of 15% by FY26.</li>
<li>With rising import alert and expected tariff increase on Chinese manufacturers, the US demand may shift from China to Malaysia. Top Glove is poised to benefit from potential trade diversion.</li>
</ul>



Top Glove Corp (TOPG MK) achieved 16% QoQ revenue growth in 3QFY24, on 13% sequential volume increase and higher ASP. 3QFY24 operational loss reduced to RM34M from RM59M in 2QFY24.
Considering the current demand and supply condition, Top Glove expects the ASP to further increase. The company aims to recover its EBITDA margin to pre-pandemic levels of 15% by FY26.
With rising import alert and expected tariff increase on Chinese manufacturers, the US demand may shift from China to Malaysia. Top Glove is poised to benefit from potential trade diversion.


Top Glove Corp (TOPG MK): Volume and ASP Growth Achieved in 3QFY24; Sees Higher Global Demand Ahead

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

Electric Connector Technology / Event-Driven

<ul>
<li>With 70% of the review period complete, we forecast 8 changes for the <a href="https://www.smartkarma.com/entities/chinext-index" target="_blank" data-smartkarma-citation="entities:25483:1" rel="noopener">ChiNext Index (SZ399006 INDEX)</a> and 5 changes for the ChiNext 50 Index in December.</li>
<li>There are overlapping names for the two indices and some of the stocks will also have flows from the <a href="https://www.smartkarma.com/entities/csi-smallcap-500-index-shang" target="_blank" data-smartkarma-citation="entities:35347:1" rel="noopener">CSI Smallcap 500 Index - Shang (SH000905 INDEX)</a> trackers.</li>
<li>The potential adds have outperformed the potential deletes for both indices on a year-to-date basis, but near-term performance has been lackluster.</li>
</ul>


With 70% of the review period complete, we forecast 8 changes for the ChiNext Index (SZ399006 INDEX) and 5 changes for the ChiNext 50 Index in December.
There are overlapping names for the two indices and some of the stocks will also have flows from the CSI Smallcap 500 Index - Shang (SH000905 INDEX) trackers.
The potential adds have outperformed the potential deletes for both indices on a year-to-date basis, but near-term performance has been lackluster.


ChiNext/​​​ChiNext50 Index Rebalance Preview: 22 Changes & US$700m Trade

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Livzon Pharmaceutical Group In / Equity Bottom-Up

<ul>
<li>With rising COVID-19 cases, a pandemic outbreak in late 2024 is likely. Investors should focus on related sectors and stocks again.</li>
<li>Due to BIOSECURE Act, US companies are leaving Chinese partners.If Trump is elected, his sanctions on China's supply chain may intensify. So, there should be “valuation discount” for China CXOs.</li>
<li>Livzon may have negative YoY revenue growth in 24H1, but full-year revenue may have positive low single-digit YoY growth. Due to good dividend/repurchase policy, Livzon deserves more patience from investors.</li>
</ul>


With rising COVID-19 cases, a pandemic outbreak in late 2024 is likely. Investors should focus on related sectors and stocks again.
Due to BIOSECURE Act, US companies are leaving Chinese partners.If Trump is elected, his sanctions on China's supply chain may intensify. So, there should be “valuation discount” for China CXOs.
Livzon may have negative YoY revenue growth in 24H1, but full-year revenue may have positive low single-digit YoY growth. Due to good dividend/repurchase policy, Livzon deserves more patience from investors.


China Healthcare Weekly (Aug.18)- COVID Is Here, BIOSECURE Act Update, Livzon Deserves More Patience

Quiddity Leaderboard ChiNext & ChiNext 50 Dec 24: US$417mn One-Way; Some Changes to Expectations

China

Intco Medical Technology Co.,Ltd. manufactures and distributes medical supplies. The Company produces disposable gloves, wheelchairs, gauzes, electrodes, and other products. Intco Medical Technology markets its products throughout China.

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Intco Medical Technology Lt (300677 CH)

Quiddity Leaderboard ChiNext Dec 24: East Group Intra-Review Deletion Causes Changes to Expectations

The ChiNext and ChiNext 50 index rebalance events could trigger one-way flows of US$297mn and US$97mn respectively during the December 2024 index...

Janaghan Jeyakumar, CFA

Top Glove Corp (TOPG MK): Volume and ASP Growth Achieved in 3QFY24; Sees Higher Global Demand Ahead

The U.S. will raise tariffs on Chinese medical and surgical gloves to 50%, from 7.5% currently, in January 2025 and to 100% by January 2026. As a...

Tina Banerjee

ChiNext/ChiNext50 Index Rebalance Preview: 22 Changes & US$700m Trade

There could be 8 changes for the Chinext and 5 changes for the Chinext50. There are 4 overlapping stocks and there are stocks with over 1x ADV to...

Brian Freitas

China Healthcare Weekly (Aug.18)- COVID Is Here, BIOSECURE Act Update, Livzon Deserves More Patience

COVID is coming again. So investors can focus on related stocks. US companies leaving Chinese partners due to BIOSECURE Act. Livzon is still worth...

Xinyao (Criss) Wang

Quiddity Leaderboard ChiNext & ChiNext 50 Dec 24: US$417mn One-Way; Some Changes to Expectations

We expect 8 changes for the ChiNext index and 5 changes for the ChiNext 50 index. Our latest estimates for one-way flows for ChiNext and ChiNext 50...

Janaghan Jeyakumar, CFA

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Quiddity Leaderboard ChiNext Dec 24: East Group Intra-Review Deletion Causes Changes to Expectations

The ChiNext and ChiNext 50 index rebalance events could trigger one-way flows of US$297mn and US$97mn respectively during the December 2024 index...

Janaghan Jeyakumar, CFA

Top Glove Corp (TOPG MK): Volume and ASP Growth Achieved in 3QFY24; Sees Higher Global Demand Ahead

The U.S. will raise tariffs on Chinese medical and surgical gloves to 50%, from 7.5% currently, in January 2025 and to 100% by January 2026. As a...

Tina Banerjee

ChiNext/​​​ChiNext50 Index Rebalance Preview: 22 Changes & US$700m Trade

There could be 8 changes for the Chinext and 5 changes for the Chinext50. There are 4 overlapping stocks and there are stocks with over 1x ADV to...

Brian Freitas

China Healthcare Weekly (Aug.18)- COVID Is Here, BIOSECURE Act Update, Livzon Deserves More Patience

COVID is coming again. So investors can focus on related stocks. US companies leaving Chinese partners due to BIOSECURE Act. Livzon is still worth...

Xinyao (Criss) Wang

Quiddity Leaderboard ChiNext & ChiNext 50 Dec 24: US$417mn One-Way; Some Changes to Expectations

We expect 8 changes for the ChiNext index and 5 changes for the ChiNext 50 index. Our latest estimates for one-way flows for ChiNext and ChiNext 50...

Janaghan Jeyakumar, CFA

ChiNext/ChiNext50 Index Rebalance Preview: 22 Changes & US$700m Trade