Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Capital Markets

<ul>
<li>Our base case valuation of ALT is 33,365 won per share, which represents 63% higher than the high end of the IPO price range of 20,500 won.</li>
<li>We estimate the company to generate sales of 69.7 billion won (up 57.3% YoY) in 2023 and 92.2 billion won (up 32.3% YoY) in 2024.</li>
<li>ALT's main business is in the testing of non-memory semiconductor value chain products including Display Drive IC, CMOS image sensor, and Power Management IC.</li>
</ul>


Our base case valuation of ALT is 33,365 won per share, which represents 63% higher than the high end of the IPO price range of 20,500 won.
We estimate the company to generate sales of 69.7 billion won (up 57.3% YoY) in 2023 and 92.2 billion won (up 32.3% YoY) in 2024.
ALT's main business is in the testing of non-memory semiconductor value chain products including Display Drive IC, CMOS image sensor, and Power Management IC.


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>The review period for a bunch of indices ended last week though the announcement of the changes will take 4-6 weeks.</li>
<li>There are no rebalance implementations in the coming week though focus will move to the implementation of the <a href="https://www.smartkarma.com/entities/housing-development-finance" target="_blank" data-smartkarma-citation="entities:252:1" rel="noopener">HDFC Limited</a>/ <a href="https://www.smartkarma.com/entities/hdfc-bank-ltd-4b6b7a92-9087-468d-9dbe-ab169e77f014" target="_blank" data-smartkarma-citation="entities:558:1" rel="noopener">HDFC Bank</a> merger and index changes the following week.</li>
<li>There were big inflows to China focused ETF with a lot of money going into Semiconductor and Chip focused ETFs.</li>
</ul>


The review period for a bunch of indices ended last week though the announcement of the changes will take 4-6 weeks.
There are no rebalance implementations in the coming week though focus will move to the implementation of the HDFC Limited/ HDFC Bank merger and index changes the following week.
There were big inflows to China focused ETF with a lot of money going into Semiconductor and Chip focused ETFs.


Index Rebalance & ETF Flow Recap: KQ150, LQ45, PCOMP, HDFC/HDFCB, Delta Electronics, Redox IPO, AMFI

<ul>
<li>ALT Co is getting ready to complete its IPO in Korea in July. ALT tests high-performance non-memory semiconductors applied to various industries such as secondary batteries, artificial intelligence, and automotive. </li>
<li>The bankers used four companies as comps for ALT including Lb Semicon, LB Lusem, Doosan Tesna, and Nepes Ark. These four stocks are up on average 48% YTD.</li>
<li>The IPO price range is from 16,700 won to 20,500 won. The expected market cap of the company post IPO is from 150 billion won to 184 billion won. </li>
</ul>


ALT Co is getting ready to complete its IPO in Korea in July. ALT tests high-performance non-memory semiconductors applied to various industries such as secondary batteries, artificial intelligence, and automotive. 
The bankers used four companies as comps for ALT including Lb Semicon, LB Lusem, Doosan Tesna, and Nepes Ark. These four stocks are up on average 48% YTD.
The IPO price range is from 16,700 won to 20,500 won. The expected market cap of the company post IPO is from 150 billion won to 184 billion won. 


<ul>
<li>Nearly a third of the way through the review period, we see 12 potential changes 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 EQUITY)</a> at the December rebalance.</li>
<li>There could be one change to the index in July/August following <a href="https://www.smartkarma.com/entities/nice-information-service-co" target="_blank" data-smartkarma-citation="entities:20236:1" rel="noopener">Nice Information Service Co (030190 KS)</a>'s transfer from the KOSDAQ Market to the KOSPI Market.</li>
<li>The potential adds have outperformed the potential deletes over the last few months and there could be further outperformance as we go through the review period.</li>
</ul>


Nearly a third of the way through the review period, we see 12 potential changes for the KOSDAQ 150 Index (KOSDQ150 INDEX EQUITY) at the December rebalance.
There could be one change to the index in July/August following Nice Information Service Co (030190 KS)'s transfer from the KOSDAQ Market to the KOSPI Market.
The potential adds have outperformed the potential deletes over the last few months and there could be further outperformance as we go through the review period.


KOSDAQ150 Index Rebalance Preview: A Dozen Potential Changes from Now to December

South Korea

LB Semicon Inc. specializes in the back-end line of semiconductor manufacturing as well as components for display equipments. The Company's main services include flip chip bumping for DDI (display driver IC), CIS (CMOS Image Sensor), and other related non-memory semiconductor testing services.

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Lb Semicon Inc (061970 KS)

ALT Co IPO Valuation Analysis

Our base case valuation of ALT is 33,365 won per share, which represents 63% higher than the high end of the IPO price range of 20,500 won.

Douglas Kim

Index Rebalance & ETF Flow Recap: KQ150, LQ45, PCOMP, HDFC/HDFCB, Delta Electronics, Redox IPO, AMFI

This recap highlights Insights covering Asian index rebalances (announcements/ forecasts/ IPO Fast Entry/ M&A driven changes). We also highlight...

Brian Freitas

ALT Co IPO Preview

ALT Co is getting ready to complete its IPO in Korea in July. ALT tests high-performance non-memory semiconductors in industries such as secondary...

Douglas Kim

KOSDAQ150 Index Rebalance Preview: A Dozen Potential Changes from Now to December

There could be 12 changes for the KOSDAQ150 from now to December. The forecast adds have outperformed the potential deletes and there could be more...

Brian Freitas

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