Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

Event-Driven

<ul>
<li>Jusung Engineering announced that it has cancelled its equity spin-off and physical division split plans mainly due to a much larger than expected share purchase requests. </li>
<li>Jusung Engineering will now buyback 50 billion won worth of shares instead, representing 3.3% of its current market cap. </li>
<li>Now that the company has cancelled the equity spin-off and physical division split, this is likely to have a positive impact on Jusung Engineering.</li>
</ul>


Jusung Engineering announced that it has cancelled its equity spin-off and physical division split plans mainly due to a much larger than expected share purchase requests. 
Jusung Engineering will now buyback 50 billion won worth of shares instead, representing 3.3% of its current market cap. 
Now that the company has cancelled the equity spin-off and physical division split, this is likely to have a positive impact on Jusung Engineering.


Jusung Engineering: Cancels Spin-Off and Announces Share Buyback Worth 50 Billion Won

<ul>
<li>On 2 May, Jusung Engineering (036930 KS) announced an equity spin-off as well as a physical division split.</li>
<li>We are negative on this combination of equity spin-off and physical division split of Jusung Engineering. </li>
<li>After the two units are listed on 6 December 2024, it is likely that the semiconductor unit (Jusung Engineering Co) will rise while Jusung Holdings Co is likely to decline.</li>
</ul>


On 2 May, Jusung Engineering (036930 KS) announced an equity spin-off as well as a physical division split.
We are negative on this combination of equity spin-off and physical division split of Jusung Engineering. 
After the two units are listed on 6 December 2024, it is likely that the semiconductor unit (Jusung Engineering Co) will rise while Jusung Holdings Co is likely to decline.


Jusung Engineering: Announces Equity Spin Off + Physical Division Split

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.

<ul>
<li>The reshuffle results align with expectations, but the decision to list 11 KOSDAQ Global stocks in April is surprising. Local authorities seem to prioritize boosting the derivatives market for liquidity.</li>
<li>Ecopro Materials' SSF listing, earlier than expected, attracts attention, potentially leading to an unusual basis pattern, coinciding with a major lockup release on May 17th.</li>
<li>We should also be wary of a pattern akin to last July's in KOSDAQ stocks. Spot prices of recent SSFs showed a pronounced short-term uptrend, especially in KOSDAQ, versus KOSPI.</li>
</ul>


The reshuffle results align with expectations, but the decision to list 11 KOSDAQ Global stocks in April is surprising. Local authorities seem to prioritize boosting the derivatives market for liquidity.
Ecopro Materials' SSF listing, earlier than expected, attracts attention, potentially leading to an unusual basis pattern, coinciding with a major lockup release on May 17th.
We should also be wary of a pattern akin to last July's in KOSDAQ stocks. Spot prices of recent SSFs showed a pronounced short-term uptrend, especially in KOSDAQ, versus KOSPI.


KRX's Official SSF/SSO Reshuffle Results: Trading Considerations

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>
<a href="https://www.smartkarma.com/entities/isc-co-ltd" target="_blank" data-smartkarma-citation="entities:13560:1" rel="noopener">ISC Co Ltd (095340 KS)</a> could replace <a href="https://www.smartkarma.com/entities/wonik-ips-co-ltd-5d7417b7-5438-41d4-a6e4-8016d24d818a" target="_blank" data-smartkarma-citation="entities:26912:1" rel="noopener">Wonik Ips (240810 KS)</a> in the FnGuide Semiconductor Top10 Index at the April rebalance.</li>
<li>
<a href="https://www.smartkarma.com/entities/jusung-engineering-co-ltd" target="_blank" data-smartkarma-citation="entities:12277:1" rel="noopener">Jusung Engineering (036930 KS)</a> is ranked just behind <a href="https://www.smartkarma.com/entities/isc-co-ltd" target="_blank" data-smartkarma-citation="entities:13560:1" rel="noopener">ISC Co Ltd (095340 KS)</a> and could be added to the index instead depending on relative price performance.</li>
<li>Shorts on <a href="https://www.smartkarma.com/entities/isc-co-ltd" target="_blank" data-smartkarma-citation="entities:13560:1" rel="noopener">ISC Co (095340 KS)</a> have been stable over the last few months while there has been big covering on <a href="https://www.smartkarma.com/entities/wonik-ips-co-ltd-5d7417b7-5438-41d4-a6e4-8016d24d818a" target="_blank" data-smartkarma-citation="entities:26912:1" rel="noopener">Wonik Ips (240810 KS)</a> and <a href="https://www.smartkarma.com/entities/jusung-engineering-co-ltd" target="_blank" data-smartkarma-citation="entities:12277:1" rel="noopener">Jusung Engineering (036930 KS)</a>. </li>
</ul>



ISC Co Ltd (095340 KS) could replace Wonik Ips (240810 KS) in the FnGuide Semiconductor Top10 Index at the April rebalance.

Jusung Engineering (036930 KS) is ranked just behind ISC Co Ltd (095340 KS) and could be added to the index instead depending on relative price performance.
Shorts on ISC Co (095340 KS) have been stable over the last few months while there has been big covering on Wonik Ips (240810 KS) and Jusung Engineering (036930 KS). 


FnGuide Semiconductor Top10 Index Rebalance Preview: One Change Likely; Close Among Potential Adds

<ul>
<li>The spot prices of the newly listed SSFs generally exhibited a notable upward trend. This trend was consistently more pronounced in KOSDAQ-listed stocks compared to KOSPI-listed ones.</li>
<li>Various factors, including actions by ETF operators, may contribute. Their SSF purchases could deepen contango, leading to temporary spot price increases through arb spread seekers anticipating this development.</li>
<li>We should focus on a potentially consistent price pattern persisting before a sufficient learning effect accumulates. The tight schedule after July increases the likelihood of similar opportunities next March.</li>
</ul>


The spot prices of the newly listed SSFs generally exhibited a notable upward trend. This trend was consistently more pronounced in KOSDAQ-listed stocks compared to KOSPI-listed ones.
Various factors, including actions by ETF operators, may contribute. Their SSF purchases could deepen contango, leading to temporary spot price increases through arb spread seekers anticipating this development.
We should focus on a potentially consistent price pattern persisting before a sufficient learning effect accumulates. The tight schedule after July increases the likelihood of similar opportunities next March.


Investigating the Use of SSF Listing Events as Fresh Flow Trading Opportunities in Korea

South Korea

Jusung Engineering Co., Ltd. manufactures semiconductor, flat panel display, and solar cell production equipment.  The Company produces space divided CVD-ALD thin film machines for semiconductor manufacture; equipment for producing liquid crystal display panels; and equipment for manufacturing crystalline silicon and thin film silicon tandem solar cells.

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Jusung Engineering (036930 KS)

Jusung Engineering: Announces Equity Spin Off + Physical Division Split

On 2 May, Jusung Engineering (036930 KS) announced an equity spin-off as well as a physical division split. We are Negative on Jusung Engineering.

Douglas Kim

KRX's Official SSF/SSO Reshuffle Results: Trading Considerations

As pointed out in this post, considering KOSDAQ additions as a long basket is suitable. However, stocks with high pre-reshuffle price appreciation...

Sanghyun Park

FnGuide Semiconductor Top10 Index Rebalance Preview: One Change Likely; Close Among Potential Adds

ISC could replace Wonik Ips in the FnGuide Semiconductor Top10 Index at the April rebalance. However, Jusung Engg is not far behind ISC and could...

Brian Freitas

Investigating the Use of SSF Listing Events as Fresh Flow Trading Opportunities in Korea

Local sources confirm that the biannual single stock futures selection for March has been finalized, with a new listing date set for April 22nd....

Sanghyun Park

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Jusung Engineering: Cancels Spin-Off and Announces Share Buyback Worth 50 Billion Won

Jusung Engineering announced that it has cancelled its equity spin-off and physical division split plans mainly due to a much larger than expected...

Douglas Kim

Jusung Engineering: Announces Equity Spin Off + Physical Division Split

On 2 May, Jusung Engineering (036930 KS) announced an equity spin-off as well as a physical division split. We are Negative on Jusung Engineering.

Douglas Kim

KRX's Official SSF/SSO Reshuffle Results: Trading Considerations

As pointed out in this post, considering KOSDAQ additions as a long basket is suitable. However, stocks with high pre-reshuffle price appreciation...

Sanghyun Park

FnGuide Semiconductor Top10 Index Rebalance Preview: One Change Likely; Close Among Potential Adds

ISC could replace Wonik Ips in the FnGuide Semiconductor Top10 Index at the April rebalance. However, Jusung Engg is not far behind ISC and could...

Brian Freitas

Investigating the Use of SSF Listing Events as Fresh Flow Trading Opportunities in Korea

Local sources confirm that the biannual single stock futures selection for March has been finalized, with a new listing date set for April 22nd....

Sanghyun Park