Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

Event-Driven

<ul>
<li>Isupetasys (007660 KS) announced a large-scale rights offering worth 550 billion won. The company plans to issue 20.1 million new shares (32% of outstanding shares).</li>
<li>About 55% of the capital raise proceeds will be used to acquire a 30.1% stake in <a href="https://www.smartkarma.com/entities/jeio-co-ltd" target="_blank" data-smartkarma-citation="entities:36398:1" rel="noopener">Jeio (418550 KS)</a>. Remaining 45% will be used to invest in Isupetays' core business. </li>
<li>Valuations on Isupetasys are not compelling. Isupetasys is also buying Jeio which has high P/E multiples, which could further result in capital outflow on Isupetasys among some value conscious investors.</li>
</ul>


Isupetasys (007660 KS) announced a large-scale rights offering worth 550 billion won. The company plans to issue 20.1 million new shares (32% of outstanding shares).
About 55% of the capital raise proceeds will be used to acquire a 30.1% stake in Jeio (418550 KS). Remaining 45% will be used to invest in Isupetays' core business. 
Valuations on Isupetasys are not compelling. Isupetasys is also buying Jeio which has high P/E multiples, which could further result in capital outflow on Isupetasys among some value conscious investors.


Isupetasys Announces a Rights Offering of 32% of Outstanding Shares and Acquisition of Jeio

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.

Equity Capital Markets

<ul>
<li>I initially skipped this rights issue due to the tight 15% discount and lack of hedge options, but today’s 20% drop opens up a potential angle worth exploring.</li>
<li>Today’s selloff stems from pushback on ISU Petasys entering the battery business, not just dilution concerns. This means there’s a high chance we’ll see a lot of leftover, unsold shares.</li>
<li>The strategy is to grab stock rights cheaply or go for the public offering. The main risk is whether the 15% spread holds until listing, but the case is strong.</li>
</ul>


I initially skipped this rights issue due to the tight 15% discount and lack of hedge options, but today’s 20% drop opens up a potential angle worth exploring.
Today’s selloff stems from pushback on ISU Petasys entering the battery business, not just dilution concerns. This means there’s a high chance we’ll see a lot of leftover, unsold shares.
The strategy is to grab stock rights cheaply or go for the public offering. The main risk is whether the 15% spread holds until listing, but the case is strong.


ISU Petasys Rights Issue: Today’s Wild Price Action Has Opened up a Fresh Trading Angle

Cross Asset Strategy

<ul>
<li>In this analysis, we provide a back testing analysis of the end of mandatory lock-up periods monthly data in Korea in the past six months.</li>
<li>All in all, this end of mandatory lock-up period monthly data continues to provide some alpha generating results.</li>
<li>In the past six months, they have tended to work better in periods when KOSPI declines rather than in periods when KOSPI rises. </li>
</ul>


In this analysis, we provide a back testing analysis of the end of mandatory lock-up periods monthly data in Korea in the past six months.
All in all, this end of mandatory lock-up period monthly data continues to provide some alpha generating results.
In the past six months, they have tended to work better in periods when KOSPI declines rather than in periods when KOSPI rises. 


Back Testing the End of Mandatory Lock-Up Periods Monthly Data in Korea

<ul>
<li>We discuss the end of the mandatory lock-up periods for 53 stocks in Korea in February 2024, among which 3 are in KOSPI and 50 are in KOSDAQ.</li>
<li>These 53 stocks on average could be subject to further selling pressures in February and could underperform relative to the market.</li>
<li>The top five market cap stocks including those with 1% or higher A/B ratio include the following: Sam A Aluminum, Jeio, HLB Therapeutics,  Polaris Office, and Mirae Asset Venture Investment. </li>
</ul>


We discuss the end of the mandatory lock-up periods for 53 stocks in Korea in February 2024, among which 3 are in KOSPI and 50 are in KOSDAQ.
These 53 stocks on average could be subject to further selling pressures in February and could underperform relative to the market.
The top five market cap stocks including those with 1% or higher A/B ratio include the following: Sam A Aluminum, Jeio, HLB Therapeutics,  Polaris Office, and Mirae Asset Venture Investment. 


End of Mandatory Lock-Up Periods for 53 Companies in Korea in February 2024

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>There are 17 inclusions and 17 exclusions for 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)</a> at the December rebalance to be implemented at the close on 14 December.</li>
<li>While most of the inclusions were expected, there are many differences on the deletes. Trading the strategy becomes tougher with the short sell ban in place.</li>
<li>The adds have started to outperform the deletes over the last month and there could be more movement over the next 3 weeks to implementation.</li>
</ul>


There are 17 inclusions and 17 exclusions for the KOSDAQ 150 Index (KOSDQ150 INDEX) at the December rebalance to be implemented at the close on 14 December.
While most of the inclusions were expected, there are many differences on the deletes. Trading the strategy becomes tougher with the short sell ban in place.
The adds have started to outperform the deletes over the last month and there could be more movement over the next 3 weeks to implementation.


KOSDAQ150 Index Rebalance: 17 Changes a Side; Many Surprises

South Korea

Jeio Co., Ltd. manufactures and distributes materials inspection, measurement and analysis instruments. The Company produces secondary batteries carbon nanotube conductive materials, advanced nano materials, secondary battery materials, physicochemical equipment, reactors, and other related products. Jeio also offers plant engineering, fine chemicals, and petrochemicals products.

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

Jeio (418550 KS)

Isupetasys Announces a Rights Offering of 32% of Outstanding Shares and Acquisition of Jeio

Isupetasys (007660 KS) announced a large-scale rights offering worth 550 billion won. The company plans to issue 20.1 million new shares (32% of...

Douglas Kim

ISU Petasys Rights Issue: Today’s Wild Price Action Has Opened up a Fresh Trading Angle

This post dives into why today’s wild price action in ISU Petasys, following last Friday’s 500 billion KRW rights offer, has unlocked a fresh...

Sanghyun Park

Back Testing the End of Mandatory Lock-Up Periods Monthly Data in Korea

In this analysis, we provide a back testing analysis of the end of mandatory lock-up periods monthly data in Korea in the past six months....

Douglas Kim

End of Mandatory Lock-Up Periods for 53 Companies in Korea in February 2024

We discuss the end of the mandatory lock-up periods for 53 stocks in Korea in February 2024, among which 3 are in KOSPI and 50 are in KOSDAQ.

Douglas Kim

KOSDAQ150 Index Rebalance: 17 Changes a Side; Many Surprises

There are 17 changes a side for the KOSDAQ150 in Dec. Most of the inclusions were on expected lines, but there are many difference among the...

Brian Freitas

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)